The Shanghai Pudong New Area Procuratorate has released China’s first intellectual property rights (IPR) compliance guidelines. The goal is to highlight IPR-related risks and drive the establishment of a robust IP compliance system.
IP compliance includes patents, trademarks, copyrights, and trade secrets. The guidelines distinguish IPR risks according to their level. For example, changes in intellectual property legislation, fine decisions, regulatory opinions and risk warnings from supervisory authorities, and the implementation and correction of regulatory opinions are classified as significant risks.
Medium risks exist when existing risks in business operations related to compliance change, but their impact on business operations is minor. General risks relate to matters that have only a minor impact on IP compliance and can be improved by management, for example.
To avoid IP risks, companies should develop response plans for these three risk levels, establish a dedicated IP compliance department or work with law firms. While the guidelines are not mandatory, they do provide companies with professional guidance. Their application is likely to be decisive in the event of a conflict. Foreign companies should systematically monitor their IP risks, build a reserve for claims, and train technical staff on IP risks.