Record of license contract for patent exploitation refers to the administrative act of China National Intellectual Property Administration (CNIPA) to record and file the license contract for patent exploitation that has been concluded by the parties and has become effective, and make it for public notification. This work is the administrative means of CNIPA to effectively protect patent rights, regulate trade behaviors and promote patents implementation. Record of license contract for patent exploitation is not a legal mandatory requirement, but the contract been recorded has the publicity to more powerfully protect the rights of the licensee. When there is patent infringement dispute, the license contract for patent exploitation been recorded can be important evidence of the licensee for requesting stopping the patent infringement behavior before litigation. In addition, the certificate for the record of license contract for patent exploitation can also be the documentary evidence of procedures related to Customs IP filing and so on.
In practice, with the improvement of the legal frame of IP protection, more and more patentees start to realize that their means to execute rights is diversified. When the patentee hope to still take hold of rights in their own hands to gain more initiative and beneficial status during the technique transaction, they can sign the license contract for patent exploitation for the purpose of replacing the patent transfer contract that is more commonly used before.
Recently, CNIPA conducts the license contract for patent exploitation mainly according to the Patent Law and its rules of implementing regulations, as well as Measures for the Record of License Contracts for Patent Exploitation. These are relatively generalizable rules in lack of guidance of details. Hereinafter, some common problems we had in the cases of successful or failed filing are generalized to attempt to find and conclude specific connotation and denotation of the filing requirement.
In conclusion, CNIPA only makes written examinations for the record without statement and reply, therefore, whether the record is successful or not depends on the preparation of the filing documents. As for the documents required for filing, Article 8 of Measures for the Record of License Contracts for Patent Exploitation stipulates that the following documents shall be submitted to apply for the license contract for patent exploitation:
1. An application form for the record of patent license contracts signed or affixed to seals by the licensor or the patent agency authorized by the licensor;
2. A copy of the license contract for patent exploitation;
3. The identity certification of both parties;
4. A power of attorney that specifies the authority of the patent agency (if any) authorized by the licensor;
5. Any other documents if required.
These rules seem to be explicit but each one need to be interpreted in detail.
1. An application form for the record of patent license contracts signed or affixed to seals by the licensor or the patent agency authorized by the licensor;
The said form is the standard form provided by CNIPA, all key contents that can ensure the effectiveness of license contracts need to be filled in it, specifically including the name and address of the licensor and licensee; way of license (proprietary, exclusive, normal); license range (usually Chinese mainland) and time (as of the termination date of patent right), the amount and payment pattern of royalties, and so on. In practice, it is just need to fill in the form information according to the license contract content. Examiners will first review whether the application form has full contents after getting the filing data. If some are not completed, then the filing application will not be accepted and dealt with. In the other side, the form content must be traceable with evidence, in other words, it is impossible to successfully record with non-contract content in the form.
2. A copy of the license contract for patent exploitation;
(1) In form: with original copy
In practice, there are often clients who sign extremely complex the license contract for patent exploitation including patent families in multiple countries and multiple terms for unified licensing. In this case, the clients usually cannot provide us the only one original copy for filing. In response, CNIPA regulates that the notarized contract copy in conformity with the original copy can also be submitted. It is noted that the copy been notarized is mandatory requirement, and non-notarized copy cannot be filed. The location for notarization is not limited by Patent Office, that is to say, the efficacy of Notarial Certificate issued by China’s Notary Office or foreign notary organizations are all acknowledged. However, it should be noticed that CNIPA only accept the notarization copy “consistent with the original copy” instead of other forms. For the original copy signed by both parties via the Internet without keeping the original containing written signature, when the original copy and notarization copy cannot be provided, CNIPA will not accept the “evidence preservation” of notarization regarding to Internet documents. Therefore, we can learn about that the minimum standard of contracts regulated by CNIPA is the necessity of “paper original copy”.
(2) For contents: complete information
As the application form content described above, if there is short of necessary items in the contract, then it can be determined that it is impossible to succeed in record. The minimum standard for contract examination is that items in filing application form all have basis in the contract, at least.
(3) Compliance for appointments
It is not allowed to have any words not conforming to filing requirements in the contract, for example, contracts with clause excluding jurisdiction like “this contract is only subject to the jurisdiction of the New York State law” cannot complete the record. In addition, the key words like “proprietary” in the contract must be explicit, it cannot use informal expression like “sole”. If the signed contracts provided by clients are not in conformity with above requirements, we will suggest to prepare another contract for filing to conform to relating rules.
3. The identity certification of both parties;
If both parties of the contract are natural persons or legal persons, then it just need to provide the identity card or legal person identification added with official seal without any unnecessary details. However, in practice, there are usually parties who are not legal persons of enterprises outside the mainland. Therefore, CNIPA requires that the original copy of qualification certificate or notarized copy must be submitted. In terms of common sense, it is impossible for a foreign company to supply the only original copy of qualification certificate but the notarized copy. What need to be noticed is that it must be the original copy of notarization certificate instead of its scanning copy to conform to the requirement. The notarization procedure can be performed in the notary authority where the legal person locates.
4. A power of attorney that specifies the authority of the patent agency (if any) authorized by the licensor;
The authorization range must be specified clearly in the power of attorney, which includes affairs for exploitation license filing, both licensor and licensee need to sign and provide the original copy.
5. Any other documents if required.
(1) If the submitted document is non-Chinese, then its Chinese translation is a necessity, and CNIPA examines the documents based on Chinese version.
(2) If the sign date of contracts has been more than 3 months overdue for filing submission date, then it is required for both parties to sign another “Statement for contract effectiveness” to prove that the contract is still in the period of validity when filing, and the original copy of this statement is also a necessity. It shall be noticed that the signatory of the statement had better keep same with that of the original contract, or else examiners will ask for demonstration of the signing qualification of the signatory.
