In order to tackle challenges in IPR protection and rely upon criminal proceedings more effective in terms of IPR protection in China, the Supreme People’s Court, the Supreme People’s Procuratorate and the Ministry of Public Security in China jointly promulgated “Opinions on Several Issues of Application of Laws in Handling Criminal Cases of Infringing Intellectual Property” (“Opinion”) January 10, 2011 in accordance with the PRC Criminal Law, PRC Criminal Procedure Law, pertinent judicial interpretations and the practices of criminal investigation, prosecution and trials in China.

The Opinion offers clearer guidelines in the following issues, which frequently frustrates efforts in putting blatant and egregious counterfeiters behind bars and/or subjecting them to deserving penalties for criminal violations of IP rights.

(1) Jurisdiction of criminal IPR infringement cases;

(2) Validity of evidence collected by the administrative enforcement officials when dealing with IPR infringement crimes;

(3) Verification of the suspect goods and use of authentication institute when dealing with IPR infringement crimes;

(4) The courts’ discretion in offering assistance in evidentiary collection at the request of the plaintiff in private prosecution for IPR infringement cases;

(5) Definition of “identical products” as provided for in Article 213 of the PRC Criminal Law. As well as “attempt of crimes” of selling counterfeit products or products bearing counterfeit trademarks;

(6) Clarification of “for profit purpose” and “without authorization of the copyright owner” tests copyright infringement crimes; clarification of the concept of “distribution” provided for in Article 217 of the PRC Criminal Law to require all piracy cases be prosecuted under that article and provision of new types of thresholds for online piracy crimes;

(7) Calculation of accumulative amount of illegal revenues/profits in repeated IPR infringements;

(8) Further clarification of the criminal liabilities of suspects who assist IPR crimes.

(9) Clarification of criminal liabilities for online counterfeiting acts. 

The issuance of the Opinion coincides with the Nationwide Special Campaign against IPR Infringement and Counterfeits, which has been launched by the Chinese Government since October of 2010 and is due to last until June of 2011, aimed at reducing the number of pirated goods and strengthening protection of patents, trademarks and copyrights of a wide range of goods made both at home and abroad. This is an important arrangement of the State Council to meet the need of safeguarding normal market economic order, unleash vitality of innovation and enhance industrial competitiveness.

As part of the anti-counterfeit campaign, the Ministry of Public Security of China (MPS) has mobilized police nationwide and carried out operations code-named SWORD ACTION with the following crimes in IP field as top priorities in their hit list:

A. Printing and reproduction of pirated publications, CD-ROMs, software, and passing off registered trademarks;  

B. Passing off international and domestic brands with high reputation;  

C. Manufacturing and selling fake drugs, food, agricultural products;  

D. Using Internet to disseminate works of pirated audio-video and software, and to sell fake and shoddy goods;  

E. Trans-regional and cross-border crimes;  

F. Professional, organizational and big scale crimes;  

G. Crimes linked to commercial bribery and other crimes;  

H. Other serious crimes with very bad impacts. 

At present, trademark holders or their trademark attorneys in China should not be surprised when they receive requests from the local police for assistance in verifying suspect products held in their custody or identified during their ex officio actions to enable them to pursue the counterfeiters for criminal liabilities. It is important and necessary for IPR holders and/their local counsels in China to be responsive to the police requests and offer them the required support in time so as to engage the Chinese police and courts in pursuing criminal actions against the counterfeiters.

For more details of the Opinion, the on-going nationwide crackdown on counterfeiters as well as the Sword Action initiated by the Chinese police, please contact us at mail@ccpit-patent.com.cn or approach your regular contacts at our office for inquiries.