Ethan Ma Discusses Improvements in China IP Law

Corporate Counsel

Orrick partner Yufeng (Ethan) Ma recently spoke with Corporate Counsel on China’s changing attitudes towards intellectual property. The country has long been thought of as having little respect for IP, but with new courts and laws focused on addressing infringement, much has improved. One highlight is the establishment of three dedicated IP courts, and the staffing of 3,000 judges in different levels of courts throughout the country who hear exclusively IP-related suits. According to Ma, “They're probably the best judges in China.” 

Ma noted that China has also significantly altered its existing IP laws, including allowing rights owners to appeal administrative infringement rulings to judicial courts, which provides them with more protection. In addition, the judicial interpretation on patent infringement litigation has been revised to allow courts to award higher damages in infringement cases. “China is headed in the right direction,” Ma said.
The greater emphasis on IP has made life easier for foreign companies who do business in China as well as domestic companies. Ma pointed out that 95 percent of all IP litigation in China is between Chinese companies and does not involve any foreign multinationals. However, one regulation that could greatly affect multinational corporations concerns the compensation paid to domestic employees for their inventions, as many companies have launched research centers in China. 

“This regulation is making companies nervous,” said Ma, continuing, “Companies still have the right to set the amount of the reward, but if it is not deemed reasonable, they could be required to pay an amount that is dictated by statute.”​