China Laws and Regulations Update in April 2019

1.The Trademark Law of the People’s Republic of China

Co-promulgated by the Standing Committee of the National People’s Congress

Promulgation date: 23 April 2019

Implementation date: 1 November 2019

The main contents of this amendment are: 1. new regulations on bad faith registration: refusal of trademark registration applications for a purpose other than use of the trademark and including “trademark registration applications for a purpose other than use of the trademark” as a valid reason for claiming trademark opposition or invalidity; 2. giving more serious punishment for infringement of proprietary rights in the trademark by increasing the multiple used to calculate the amount of damages for a malicious infringement of proprietary rights in the trademark from larger than one but smaller than three to larger than one but smaller than five and increasing the upper limit on legal damages from RMB three million to RMB five million. (Source: Website of the National People’s Congress)

http://www.npc.gov.cn/npc/xinwen/2019-04/23/content_2086193.htm

2.The Anti-Unfair Competition Law of the People’s Republic of China

Promulgated by the Standing Committee of the National People’s Congress

Promulgation date: 23 April 2019

Implementation date: 23 April 2019

This Amendment is mainly used to protect trade secrets, which clarifies the circumstances in which trade secrets are infringed, adding the circumstance of “abetting, tricking and helping other person to violate confidentiality obligations or the owner’s requirement that trade secrets should be kept in confidence, obtaining, disclosing, using or allowing other person to use the owner’s trade secrets”; includes “natural, legal and non-legal persons except business owners” in people who should be responsible for infringement of trade secrets; states that damages for a serious malicious infringement of trade secrets should be determined at the rate of more than one and less than five times more than the owner’s actual loss arising from such infringement or the infringing person’s benefits from such infringement; and further states that if the owner’s actual loss arising from such infringement or the infringing person’s benefits from such infringement could not be determined, the upper limit on the amount of damages should be RMB five million, not RMB three million. (Source: Website of the National People’s Congress)

http://www.npc.gov.cn/npc/xinwen/2019-04/23/content_2086193.htm

3.The Construction Law of the People’s Republic of China

Promulgated by the Standing Committee of the National People’s Congress

Promulgation date: 23 April 2019

Implementation date: 23 April 2019

This amendment cancels the requirement that the payment of funds certificate and other documents should be submitted with the construction permit application and further improves the conditions that should be met to apply for the construction permit (and cancels the all-inclusive condition “as required by laws and administrative regulations”) and shorten the period of time in which the construction permit application should be decided (this period is changed from within fifteen days of the application date to within seven days of the application date). (Source: Website of the National People’s Congress)

http://www.npc.gov.cn/npc/xinwen/2019-04/23/content_2086193.htm

4.The Government Information Disclosure Rules of the People’s Republic of China

Promulgated by the State Council

Document number: S.O.No.711

Promulgation date: 15 April 2019

Implementation date: 15 May 2019

The main contents of this amendment are: disclosure in general cases with exceptions of non-disclosure, extended areas of disclosure, circumstances of non-disclosure of government information, removal of the rule on requesting relevant government information “subject to manufacturing, living, study and other special needs”. (Source: Website of the State Council)

http://www.gov.cn/zhengce/content/2019-04/15/content_5382991.htm

5.Announcement on Mutual Recognition of “Authorized Economic Operators” (AEO) Between the Customs of China and the Customs of Japan

Promulgated by the General Administration of Customs

Document number: No.71 Announcement of the General Administration of Customs in 2019

Promulgation date: 24 April 2019

Implementation date: 1 June 2019                                

The Arrangements on Mutual Recognition of the Enterprise Credit System of the Chinese Customs and the Authorized Economic Operator System of the Japanese Customs Between the Customs of the People’s Republic of China and the Customs of Japan will take effect on June 1st, 2019.  The Chinese and Japanese sides recognize each other’s customs “authorized economic operators” (AEO enterprises). The Customs of Japan recognizes the Chinese customs highly rated enterprises as Chinese AEO enterprises. The Customs of China recognizes the Japanese customs “authorized economic operators” as Japanese AEO enterprises. The Chinese and Japanese customs give convenience to each other’s AEO enterprises in the process of customs clearance of import goods, for example, by taking AEO qualifications into full consideration when evaluating risks in simplified examination and supervision processes, completing the examination of goods of AEO enterprises in the shortest possible time, designating a person from the customs to solve problems AEO enterprises have about customs clearance, and completing the customs clearance of goods of AEO enterprises in the shortest possible time after the main infrastructure recovers from trade interruption. (Source: Website of the General Administration of Customs)

http://www.customs.gov.cn/customs/302249/302266/302269/2397512/index.html

6.Regulations (V) on Several Issues Concerning the Application of the Company Law of the People’s Republic of China

Promulgated by the Supreme People’s Court

Document number: L.I.(2019) No.7

Promulgation date: 28 April 2019

Implementation date: 29 April 2019                               

The Regulations consists of six articles, mainly dealing with completion of legal proceedings that gives no exemption from compensation for associated transactions, invalidity and cancellation of associated transaction contracts, dismissal of a director without cause and severance pay, duration of profit distribution, resolution of serious disputes between shareholders of a limited liability company, etc. (Source: Website of the Supreme People’s Court)

http://www.court.gov.cn/fabu-xiangqing-155292.html

Lawyer Contacts

You Yunting

86-21-52134918  

youyunting@debund.com

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