Regulations of the Supreme People's Court on Several Issues concerning the Application of Law in the Review of Cases for the Preservation of Actions in Intellectual Property Rights will be implemented from 1 Jan., 2019

For those IP infringement cases, many IP right owner won the case, but might have lose the market competitive advantage; or the owner’s trade secrets have been disclosed, which means its loss could not be recovered. In view of this, recently, the Supreme People’s Court released the “Regulations of the Supreme People’s Court on Several Issues concerning the Application of Law in the Review of Cases for the Preservation of Actions in Intellectual Property Rights” (hereinafter refers to “Regulations”), in which the preservation of actions in IPR has been prescribed. The main content includes:

1.The circumstances which could applied the immediate preservation of actions

According to Article 6 of the “Regulations”, the immediate preservation of actions could be applied to the following 5 circumstances: (1) the applicant’s trade secrets is about to be illegally disclosed; (2) the applicant’s rights of the person, e.g. right of publication, privacy and etc., is about to be infringed; (3) the disputed IPR is about to be illegally disposed; (4) the applicant’s IPR is being infringed or is about to be infringed in the strong efficiency circumstances, such as exhibition and etc.; (5) the programs which have strong efficiency is being infringed or is about to be infringed.

2.The factors which shall be taken into consideration while reviewing an application for the preservation of actions

Article 7 of the “Regulations” has listed main factors, which are, (1) whether there is a fact and legal basis for the application, e.g. the relevant IPR is stable; (2) if the preservation measures are not taken, whether it will result in difficulty in the enforcement of future judgments, or make the applicant suffer irreparable damage to its legitimate rights and interests; (3) whether the damage that will be caused to the respondent by taking preservation measures is significantly greater than the damage that will be caused to the applicant if preservation measures are not taken; (4) whether public interests will be prejudiced if preservation measures are taken.

In addition, the “Regulations” has further specified the criteria in identifying whether an IPR is stable, the irreparable damage, and so on.

3.The guarantee amounts

The percentage of the guarantee amounts for the IPR preservation of actions is different from 30% in normal civil guarantee amounts. Article 11 of the “Regulations” has prescribed that the guarantee amounts shall be equal to the loss that the respondent might be suffered, including the sales profits, storage expenses related to the disputed products. In addition, the court could require the applicant to increase guarantee in an appropriate amount, if the respondent claims and is able to prove that it may suffer greater losses due to the preservation measures taken.