A Quick Primer on Chinese Patent Law

A Quick Primer on Chinese Patent Law

Historical Perspective

Historically, China refused to protect intellectual property. However, it has recently begun taking steps to offer such protection. China’s historic refusal to protect intellectual property was due to two primary factors: communism discourages individual property, and the Chinese view copying as flattery. As a result, it has been estimated that 90% of Chinese government offices practice piracy and that 96% of Chinese software is counterfeit. These problems plague both Chinese and U.S. companies.

In the late 1970s, China recognized that it needed to protect intellectual property in order to attract foreign investment. Accordingly, China began passing comprehensive intellectual property laws in the 1980s. However, despite passing numerous laws to protect intellectual property, enforcement efforts were often lax. For example, when Chinese authorities found 650,000 unauthorized Microsoft holograms in 1992, Chinese courts imposed a $260 fine. In another early action, Microsoft received only $2,500 in damages when seeking $22 million. To begin addressing these enforcement problems, China has subscribed to a number of multi-lateral treaties, including the World Intellectual Property Organization (1980), the Paris Convention (1985), the Madrid Agreement for the International