Houston Finance

Mar 22 2018

Getting a Patent in China

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Getting A Patent In China. The China Patent Shuffle.

Kelly Spors, the Wall Street Journal s spot on Q A columnist on entrepreneurship and small business answered a question today on securing a China patent.

The question asked of Ms. Spors by a U.S. patent holder is whether it is worth spending the money for a patent in China to prevent knockoffs from being made there?

Ms. Spors says probably yes.

She starts out by noting that given China s reputation for meagerly enforcing intellectual property rights, getting a patent there may seem like a pointless expense. But you may kick yourself later on if you don t.

She then rightfully notes that in spite of the problems companies have in enforcing their patents in China, they are sometimes critical to prevent others from patenting YOUR product:

The big risk: If another company patents your idea first, it can turn around and sue you for infringement. It isn t as much about getting a patent in China as preventing other people from getting one, says Siva Yam, president of the U.S.-China Chamber of Commerce, a Chicago-based organization that helps businesses navigate China. Mr. Yam says the Chinese government is trying to better enforce patents, so having a Chinese patent may be worth more in the future.

Mr. Yam recalls a few years back when a Pennsylvania company decided not to seek a patent in China since it was already selling the technology there. But a Chinese company later sought and received a patent on a similar technology and then sued the U.S. company, along with writing letters to its customers threatening to sue if they continued doing business with the firm. The Chinese company eventually backed down, but not before the U.S. company had spent ample time and money fending off the claims.

She says it also makes sense to get a Chinese patent if you are selling your product into the Chinese market and that a patent will allow you to fight back if the manufacturer starts selling knockoffs of your product. She then notes that if you are going to seek a China patent of that which you have already patented in the United States, you must do so within a year of filing your U.S. patent application, unless you get an extension by filing an international patent application.

She is absolutely right about this. The China lawyers at my firm have received countless phone calls from companies agonizing over whether or not to get a China patent until we end that particular agony by telling them that they are too late.

I am probably a bit less upbeat than Ms. Spoor on the benefits of securing a China patent because they do tend to be difficult to enforce in China. One of the Chinese lawyers with whom we regularly work is even of the view that getting a strong trademark and constantly updating your product militate against the need to get a patent most of the time. But this ignores the problem of someone else stepping in and registering your patent in China. Though we are constantly seeing instances where Chinese companies swoop in and register someone s US trademark in China, it is less common with patents and I think this is because it is generally considerably more complicated and expensive to register a patent than it is to register a trademark.

Bottom Line: f you are doing business in China or even just considering doing so, you should be looking now at what you can do to protect your IP (patents, trademarks, copyrights, trade secrets, etc.) in China.

Dan Harris

Dan Harris is internationally regarded as a leading authority on legal matters related to doing business in China and in other emerging economies in Asia. Forbes Magazine, Business Week, Fortune Magazine, BBC News, The Wall Street Journal, The Washington Post, The Economist, CNBC, The New York Times, and many other major media players, have looked to him for his perspective on international law issues.

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We will be discussing the practical aspects of Chinese law and how it impacts business there. We will be telling you what works and what does not and what you as a businessperson can do to use the law to your advantage. Our aim is to assist businesses already in China or planning to go into China, not to break new ground in legal theory or policy.

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