Groups share wisdom and experiences on the patent front

The improved intellectual property system in China has given more confidence to companies seeking to protect their rights and more motivation for them to build up their competitiveness by developing core patented technologies, according to industry insiders.

During a recent group interview with companies in Zhongguancun Science Park - a major high-tech hub that contributed an estimated 64 percent of invention patents in Beijing by the end of 2017 - they shared their stories of and insights into the development of IP.

Involved in a five-year patent lawsuit, BMC Medical, a major respirator maker in the park, finally reached a settlement with the plaintiff.

Although it cost tens of millions of yuan, Gao Chengwei, executive deputy general manager of the company, said it was "all worth it".

BMC was founded in 2001. It rose to fame as the first Chinese medical equipment company that prevailed in a Section 337 investigation, a practice in the United States targeting unfair competition from imported products, especially IP infringements.

In 2013, one year after it entered the US market, the company was sued by Australian medical machinery provider ResMed. The latter claimed that BMC violated its rights to eight of its patents.

Du Yicheng, senior manager of BMC's IP department, recalled how their brochures and equipment were confiscated at an exhibition in Germany, since public exposure of any product under the Section 337 investigations is punishable by a fine of $100,000 a day.

Gao said the reason for the dispute was that they had taken market share from the other. "Since we are entering the global market, such disputes are unavoidable, so we decided to fight," he said, adding they believe that they held original patents.

In January 2017, the two companies reached an agreement that neither side would file an IP infringement suit within five years. But the price was high - they were forced to pay out over 43 million yuan ($6.18 million) in attorney fees.

The annual revenue of BMC was only about 100 million yuan at the time.

Du suggested Chinese companies study their targeted markets first when going global and ask for help from local lawyers when needed.

"The domestic IP-related legal system has seen radical change in recent years," Du said. "Significant progress has been made. We have more confidence in confronting others over such disputes."

Beijing Sanyou Intellectual Property Agency, one of the earliest private patent agencies in China, has also witnessed the country's IP development.

In 1986, when the agency was founded, the number of patent applications nationwide was about 18,000 and the number of patents actually granted was only about 3,000. In 2017, the figures jumped to about 3.69 million and 1.83 million, respectively.

From multiple amendments to the Trademark Law and Patent Law, to formulating a national-level IP strategy, the country has attached great importance to IP, said Li Hui, chairman of the company.

"The revised regulation of the patent agencies shows the country's approval of the patent agency industry," he said.

"The reduction in patent fees helped applications to boom," he said, adding polices are developing in line with global standards while taking the country's actual conditions into consideration.

This year marks the 40th anniversary of China's reform and opening-up and the 15th anniversary for Zhongguancun Science Park's construction of a national IP system demonstration park.

The park has provided consultancy, training and legal services to companies. Each leading company in IP can get a grant of up to 2 million yuan to support their IP-related work.

The number of patent applications from Zhongguancun grew from 2,650 in 2003 to 73,800 in 2017, with an annual growth rate averaging 26.8 percent, data from the park showed.

(Source: China Daily)