Supreme People’s Court promulgates “Provisions on Several Issues Concerning IP Court” – key points explained

China
  • The National People’s Congress has decided that all appeals against judgments rendered by lower courts in cases involving a technological aspect should be submitted to the SPC
  • The SPC has created the “Intellectual Property Court, a Detached Tribunal of the SPC”
  • In December 2018, the SPC promulgated several provisions defining how the new court will function and the boundaries of its jurisdiction

On 26 October 2018 China’s National People’s Congress decided that all appeals of judgments rendered by lower courts, in cases involving a technological aspect, should be submitted to the Supreme People’s Court (SPC). Following this decision, the SPC created the “Intellectual Property Court, a Detached Tribunal of the SPC” (the SPC IP Court). This new court started to operate, for a trial period of three years, on 1 January 2019. On 27 December 2018 the SPC promulgated the “Provisions on Several Issues Concerning the Intellectual Property Court”, which define, in more details, how the new court will function and what the boundaries of its jurisdiction are.

Background

The judicial authorities that deal with IP matters in China have different names, according to their particular status. This can be a little confusing. 

In China, People’s Courts contain several divisions. Some of these divisions are occasionally officially entrusted with certain matters, such as intellectual property. In practice, these divisions are sometimes referred to as the ‘IP tribunal’ of the court. In Chinese, the denomination is ‘Zhishi Chanquan Shenpan Ting’, where the character ‘Ting’ indicates that this so-called tribunal is an integral part of the court. 

The above applies to the SPC, which contains the Adjudicating Division No 3 specialised in IP matters, sometimes called the ‘IP Tribunal of the SPC’.

In addition, since 2015, three ‘IP courts’ have been operating in Beijing, Shanghai and Guangzhou. These three courts are completely independent jurisdictions. They are not the division of another larger entity. They are called ‘Zhishi Chanquan Fa Yuan’, where the words ‘Fa Yuan’ indicates that they are independent. 

The new jurisdiction recently created by the SPC is a special kind. It is called ‘Zhishi Chanquan Fa Ting’, where the word ‘Fa’ inserted before the word ‘Ting’ indicates that this court is still a part of the SPC but enjoys a certain degree of independence. In fact, technically, it should be called a ‘detached tribunal’, but the use of the word ‘tribunal’ could create some confusion with the ‘IP tribunal’, or division, mentioned above. Therefore, the SPC itself decided to use the English word ‘court’ (SPC IP Court) in order to avoid any confusion.

Provisions

Article 1 of the provisions emphasises the above by specifying that the SPC IP Court is a permanent entity physically detached from the SPC (its premises are located in the south of Beijing), but that its judgments are judgments of the SPC.

Article 2 defines in detail the boundaries of the SPC IP Court’s jurisdiction: 

(1) all appeals against judgments and rulings rendered by High Courts, Intermediate Courts and IP Courts (Beijing, Shanghai and Guangzhou) in civil cases involving invention patents, utility models (not designs), new plant varieties, technical secrets, computer software, electronic integrated circuits and antitrust;

(2) all appeals against judgments and rulings rendered by the Beijing IP Court in administrative cases involving invention patents, utility models, designs, new plant varieties and integrated circuits (but not antitrust, computer software or technical secrets);

(3) all appeal against judgments and rulings rendered by High Courts, Intermediate Courts and the IP Courts (Beijing, Shanghai and Guangzhou) in administrative cases involving all the types of IP rights mentioned under (1) above, plus designs;

Article 2 adds a few more provisions of jurisdictional nature: 

(4) the SPC IP Court may accept, at first-instance level, cases that are very important or complex on a national scale; 

(5) where judgments, rulings and mediation decisions made by lower jurisdictions mentioned in the above Sub-articles 1 to 3 have become effective (no appeal before the SPC IP Court), it is still possible to file (within six months) a re-trial application before the SPC IP Court; 

(6) the SPC IP Court shall also hear the appeals filed against lower-courts judgments (in cases mentioned under the above Sub-articles 1 to 3) that are based on jurisdiction issues, or imposed fines or detention or decided the prolongation of procedural time limits; and

(7) any other cases that the court may deem necessary to accept.

The SPC IP Court will use modern technologies in the procedural processes. Subject to the litigating parties’ agreement, the IP Court may serve all documents related to the case (eg, summons to appear, evidence and judgments) via the electronic platform (internal to the case and only accessible to the court and to the litigants), via the website of China Judicial Process Information Online (accessible to the public), or via fax or email (Article 4). More specifically, the court may organise the exchange of evidence or pre-trial meetings on the electronic platform or via video conferences (Article 5).

Regarding the physical location of the hearing, the IP Court is also quite flexible and may adjust to the circumstances of the case. This means that the panel of judges may decide to hold the hearing where the first-instance judgment was made or on the scene, which, one may assume, could be the place where the alleged infringing heavy machinery is located (Article 6).

All information concerning a case shall be published (case filing, composition of the panel of judges, identity of the parties, procedure and judgment) on the website of China Judicial Process Information Online (Article 8).

For very important, controversial or difficult cases, the decision will be made after internal consultation between the president, the vice president and several experienced judges of the SPC IP Court, constituting the judges’ council (Article 9).

The SPC IP Court is in charge of conducting research and establishing criteria and rules so as to guide the practice of the lower people’s courts (Article 10).

As provided by Chinese Law, the Procuratorate may request the revision of judgments; for judgments made by IP Courts and intermediate courts, the request should be made by the Supreme Procuratorate (not at the provincial level) before the Supreme People’s Court (Article 11).

The provisions set forth some transitory measures: for all judgments issued before 1 January 2019, appeals shall follow the rules in place before the creation of the SPC IP Court (Article 12); the same principle applies to judgments that became effective before 1 January 2019 (Article 13). Some local (basic level) courts may have received jurisdiction to accept cases involving technical aspects. After this date, they will no longer have this capacity. However, for cases still pending on 1 January 2019, the previous rules governing appeals against judgments (therefore rendered after 1 January 2019) shall continue to apply.

Applications for retrial

Right after the NPC’s adoption of its decision, one question came immediately to mind: since the new IP Court is part of the SPC, who will review applications for retrial filed against its judgments?

In October 2018 the SPC verbally confirmed, during a press conference, that retrial applications filed against judgments rendered by the SPC IP Court shall be adjudicated by the IPR Tribunal of the SPC. This gave rise to speculation that, whenever a case is adjudicated by the SPC Tribunal acting as second instance (when the case started, at first instance, at High Court level), the SPC IP Court might serve as retrial court. Therefore, the SPC IP Tribunal and the SPC IP Court might serve as retrial courts for each other’s cases.

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