On Dec. 19, 2013, the Standardization Administration of China (SAC) and State Intellectual Property Office (SIPO) published the Administrative Regulation on National Standards Involving Patents-Interim (Interim Regulations), which concerns the formulation and implementation of national standards involving patents. The Interim Regulations were effective Jan. 1, 2014.

According to the Interim Regulations, national standards involving patents should concern patents that are essential for implementation of the relevant standards. The Interim Regulations impose obligations regarding the disclosure of essential patents that a party owns or knows about. A party that fails to make the required disclosures may be held legally responsible for the failure to do so. In addition, even parties not participating in the formation or revision of national standards are encouraged to disclose essential patents they own or of which they are aware.

The Interim Regulations provide that patents involved in the formation and revision of national standards should be licensed on fair, reasonable and non-discriminatory (FRAND) terms. If the patent holder does not agree to license on FRAND terms, the national standards should not include such patents except in the case of mandatory national standards. For mandatory national standards, if the patent holder does not agree to license the patents on FRAND terms, the SAC, SIPO and relevant authorities are to negotiate with the patent holder regarding a method for the patent holder to divest the relevant patents.

The Interim Regulations are available here.

For further information, please contact:

Robert A. Rosenfeld, Partner, Orrick

rrosenfeld@orrick.com

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