On February 1, 2020, new regulations went into effect that clarified eligible subject matter within patent applications. The regulations implemented by the China National Intellectual Property Administration (CNIPA) will have a considerable impact regarding the eligible subject matter contained within applications related to artificial intelligence and many other patents.

Changes to CNIPA’s Guidelines

There are many changes that are worth noting. First, Section 6 was added to Chapter 9 of Part II of CNIPA’s guidelines. This will regulate the examination of those claims that include features of algorithms or business methods. In regard to algorithms and other abstract features, the new regulations do not require them to be separated from technical features. Indeed, they will not be examined as part of the whole.

The objective of this change is to provide a better analysis of the claim and identify potential technical problems and to ensure the claim will achieve the desired technical effect. Connecting these means that abstract claims without technical features will be rejected unless the applicant can show that the claim does adhere to Article 2.2.

Potential for Future Trade

Phase One of the Economic and Trade Agreement signed by President Trump in January went into effect this month. The purpose of the agreement is to defrost the escalating trade war before it causes further damage to either economy. Among issues discussed and included in the agreement, intellectual property rights took center stage. While the agreement does not end all of the disputes stemming from piracy, counterfeiting, and the need for better enforcement against other untoward activities, it is a move in a positive direction.

CNIPA has shown a willingness to implement and update the law to meet the rapidly evolving global business environment. The bottom line, is that the Chinese government is acknowledging that for them to continue doing business with American businesses, American companies need better, more reliable protection for their intellectual property.

Among issues covered in the new agreement, patent term extensions are now available to protect against unreasonable delays. This provision applies to patents that take four years or longer to approve from the date of filing or three years following any request for examining the patent application.

The US-China trade agreement also strengthens enforcement procedures against pirate and counterfeiters operating on e-commerce platforms. Clarification and streamlining of these procedures should make it easier for rights holders to halt infringement of online property quickly. It also grants the power to revoke the operating licenses of e-commerce platforms that repeatedly fail to halt the sale or trade of counterfeit items and pirated goods.

The agreement creates mechanisms for criminal and civil enforcement based on the reasonable suspicion that an actor is knowingly violating a trademark. This will give American businesses significant leverage when intellectual property theft occurs. It’s a safe bet that many companies will use this and other provisions within the agreement to pursue entities that have previously been untouchable. If the Chinese government enforces these penalties as required under the agreement, this will have a significant, positive effect on US-China trade relations.

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