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The 3rd amendment to the PRC Patent Law was passed in December 2009 and took effect on 1 October 2009. Among all the changes in this 3rd amendment, the "secrecy examination needed for applying for patent abroad for inventions completed in China" has gained extensive concerns by industries (New Secrecy Examination). To comply with the implementation of the new Patent Law, the PRC government is now amending the Implementation Rules of the Patent Law as well as the Patent Examination Guidelines. Since the amendment of each of the implementation Rules and the Patent Examination Guidelines have not been concluded and announced, how the New Secrecy Examination is implemented has become concerned by patent applicants/industries.
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Prior to 30 September 2009, for companies having R&D operation in China, they had to first file Chinese patent applications for inventions and utility models (design not included) completed in China (i.e., First Filing Requirement for Local Inventions), and later apply for patent abroad for the said inventions. Through the 3rd amendment of the Chinese Patent Law, "First Filing Requirement for Local Inventions" has been abolished; according to Article 20 of the new Patent Law, for inventions and utility models completed in China, patent applicants may choose first filing patent applications therefor either in China or abroad; however, prior to applying for patent abroad, the patent applicants must voluntarily apply for New Secrecy Examination for these inventions with the State Intellectual Property Office (SIPO). If the New Secrecy Examination requirement is not met, the Chinese patent applications will not be allowed; if such Chinese patent applications are allowed by negligence, they will be subject to invalidation.
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In fact, secretary examination practice has been in existence in Chinese patent practice before the 3rd amendment of the Patent Law. According to Article 4 of the Patent Law (which has not been changed in the 3rd amendment), where an invention or creation under patent protection involves state security or significant interest of the state, therefore causing it necessary to keep the invention or creation confidential, the state shall deal with the confidentiality need according to laws. The secrecy examination of patent applications under Article 4 of the Patent Law is initiated by the SIPO, and no applications from patent applicants are needed.
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Among the inventions from the world, a substantial portion of them are originated from and completed in China, and it has been very commonly seen that companies from Taiwan and other foreign countries have set up their R&D operations in China.
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It has become important and critical for industries to decide how to apply for patent globally for inventions and creations completed in China. To comply with implementation of the new Chinese Patent Law, the SIPO is now working on amendment of the Implementation Rules of the Patent Law as well as the Patent Examination Guidelines. According to the draft amendment of the Implementation Rules of the Patent Law, as of 1 October 2009 and for inventions and creations completed in China (not including Taiwan, Hong Kong and Macao), implementation details regarding the New Secrecy Examination are as follows:
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Prior to applying for patent abroad (via either a national filing or a PCT international filing), a patent applicant must apply for and comply with the New Secrecy Examination beforehand by submitting a written document illustrating the invention or creation.
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If a patent applicant decides to first file a patent application in China and later apply for patent abroad, he/she must apply for and comply with the New Secrecy Examination before applying for patent abroad. A qualified applicant may choose first filing a PCT international patent application with the SIPO as receiving office; at the time of filing the PCT application, it shall be presumed that a request for New Secrecy Examination has been simultaneously filed (i.e., no specific request for New Secrecy Examination is needed).
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If a patent applicant decides to first file a foreign patent application, he/she must submit a request for New Secrecy Examination as well as a written document illustrating the invention or creation, which must be prepared in Chinese language.
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The key points for preparing the above-mentioned document illustrating the invention or creation are as follows:
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(1)
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The document must sufficiently disclose the invention or creation;
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(2)
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The disclosure in the document must be consistent with the content of the invention or creation. If the above-mentioned document does not meet the formality requirements, it shall be deemed that a request for New Secrecy Examination is not filed, and the applicant may re-file a request for New Secrecy Examination.
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If it is deemed not necessary to keep an invention or creation confidential, the SIPO shall issue a Notice of Secrecy Examination notifying the applicant to go ahead with foreign patent filing. If no Notice of Secrecy Examination is received within 4 months from the date of filing a request for New Secrecy Examination, the applicant can proceed with foreign patent filing accordingly. If it is deemed necessary to keep an invention or creation confidential, the SIPO shall issue a Notice of Secrecy Examination notifying the applicant to suspend the foreign patent filing, and will issue a "Notice of Decision for Secrecy Examination" through further verification. If a "Notice of Decision for Secrecy Examination" is not received within 6 months from the date of filing a request for New Secrecy Examination, the applicant can proceed with foreign patent filing accordingly.
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Details regarding implementation of the New Secrecy Examination need to be supplemented by the amendment of the Implementation Rules of the Patent Law and the Patent Examination Guidelines. In addition, the following topics regarding the New Secrecy Examination are note-worthy:
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Due to the international economic and technical activities, R&D activities are of variety and joint R&D projects have been commonly seen. Co-inventors may stay in different countries and R&D activities may involve activities from multiple countries. Under such situation, how to determine whether the inventions concerned are completed in China?
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Except for China, other specific countries may also require secrecy examination and implement technology export control for inventions completed in their countries. If the places involved in the R&D of an invention involves China and any of the above-mentioned foreign countries, how the patent applicant take care of requirement respect to the secrecy examination, which is prescribe in laws from both China and the other foreign country.
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Filing a patent application in Taiwan is deemed as a "foreign filing" as far as the New Secrecy Examination is concerned. In other words, for inventions and creations completed in China, prior to applying for patent in Taiwan, the New Secrecy Examination requirement must be complied. If the applicant decides to first file a Chinese patent application, he/she must apply for New Secrecy Examination as early as possible so as to file the patent application in Taiwan earlier (because priority claim cannot be made for the Taiwanese patent application based on the Chinese patent application).
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For inventions and creations completed in China, proper filing requests for New Secrecy Examination is critical to ensure the grant of the Chinese patent applications and the validity of such patents. If the requirement of New Secrecy Examination is not complied, the party concerned may be subject to liability under State Secrecy Law. It is critical and important for industries/patent applicants to come out with a plan for global patent filing with consideration of the requirements upheld in all the concerned countries.
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If the cooperation between a multi-national company and its Chinese subsidiary or its business partner in China, and if such cooperation involves R&D innovations completed in China, in addition to the New Secrecy Examination requirement set forth in the Patent Law, attention shall be paid to other laws especially governing the control of technology export.
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As stated above, secrecy examination is not a new practice in China. To implement Article 4 of the Patent Law, the SIPO has had examination mechanism to verify whether inventions or creations under patent application involved state security or significant interest of the state. According to SIPO's experience in the past, the chance for identifying inventions or creations involving state security and significant interest of the state is very limited. According to the SIPO's statistics, for all the patent cases under secrecy examination in Year 2008, only 175 cases are confirmed to involve state security or significant interest of the state, which must be kept confidential. As compared with the total 600,000 cases filed in Year 2008 (not including patent cases originated from foreign countries), the percentage of cases which must be kept confidential is very small. Therefore, it is expected that majority of the patent cases for which New Secrecy Examination is needed should not involve confidentiality issue.
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According to the SIPO's statistics, there are around 230 requests fled for New Secrecy Examination in October 2009. The SIPO completed the review of such requests and issued decisions quickly (normally within several days). The SIPO advised that they understood the importance for issuing decisions on such requests and they will conduct such examination as soon as possible so that patent applicants may have more flexibility for handling their foreign patent filing.
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