China’s first Civil Code, which was adopted at the 3rd session of the 13th National People’s Congress on May 28, 2020, will become effective as of Jan 1, 2021.  The Civil Code contains 7 Parts and 1,260 Articles. About 52 articles pertinent to matters of intellectual property rights and technology transfer scatter in different parts of the Code.

It is most welcome, to the IP community that Article 1185 of Chapter 2 in Part 7 introduces “Punitive Damages” against IP infringement, which reads that where an infringer intentionally infringes other’s intellectual property rights, in the case of serious circumstances, the right holder is entitled to request punitive damages.

The article makes “intentional infringement” a prerequisite to award “punitive damages”. In contrast, “punitive damages” against trademark infringement is to be awarded under the circumstance of “malicious infringement, in serious cases” (article 63(1) of the Trademark Law). It remains to be seen how the Supreme People’s Court (SPC) will interpret this discrepancy.  

According to SPC’s Legislative Plan for Judicial Interpretations of 2020, which was issued on March 19, 2020, Interpretation on Several Issues Concerning the Applicable Law in the Exercise of Punitive Damages for Intellectual Property Infringement is set to be completed within the first half of 2021.

Contributed by: Cindy Zhen