China’s Supreme People’s Court & Supreme People’s Procuratorate Release Draft Interpretation of Handling Criminal Cases of Intellectual Property Infringement

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On January 18, 2023 China’s Supreme People’s Court and China’s Supreme People’s Procuratorate released the Interpretation on Several Issues Concerning the Application of Law in Handling Criminal Cases of Intellectual Property Infringement (Draft for comments) (关于办理侵犯知识产权刑事案件适用法律若干问题的解释(征求意见稿)).  The Interpretation mainly sets thresholds for determining criminal prosecution, e.g., when there are “serious circumstances” in trademark infringement.  The Interpretation will replace earlier Interpretations including the 2020 Interpretation.

Article 213 of the Amended Criminal Law reads:

Using the same trademark as the registered trademark on the same commodity or service without the permission of the owner of the registered trademark, if the circumstances are serious, shall be sentenced to fixed-term imprisonment of not more than three years. A fine may be imposed concurrently or solely; if the circumstances are particularly serious, a fixed-term imprisonment of not less than three years but not more than ten years shall be imposed, and a fine shall also be imposed.

Article 1 of the Interpretation goes to explain what serious circumstances are and what are particularly serious circumstances:

Article 1 Using a trademark identical to a registered trademark on the same commodity without the permission of the owner of the registered trademark, under any of the following circumstances, shall be determined as “serious circumstances” as stipulated in Article 213 of the Criminal Law:

  (1) The amount of illegal income is more than 30,000 yuan or the amount of illegal business operations is more than 50,000 yuan;

  (2) counterfeiting two or more registered trademarks, and the amount of illegal income is more than 20,000 yuan or the amount of illegal business is more than 30,000 yuan;

  (3) Received administrative punishment for implementing acts stipulated in Articles 213 to 215 of the Criminal Law within two years, and the amount of illegal income is more than 20,000 yuan or the amount of illegal business is more than 30,000 yuan;

  (4) Other serious circumstances.

  Using the same trademark as the registered trademark on the same service without the permission of the owner of the registered trademark, under any of the following circumstances, shall be determined as “serious circumstances” as stipulated in Article 213 of the Criminal Law:

  (1) The amount of illegal gains is more than 100,000 yuan;

  (2) counterfeiting two or more registered trademarks, and the amount of illegal income is more than 50,000 yuan;

  (3) Received administrative punishment for carrying out acts stipulated in Articles 213 to 215 of the Criminal Law within two years, and the amount of illegal income is more than 50,000 yuan;

  (4) Other serious circumstances.

  Counterfeiting both registered trademarks for goods and registered trademarks for services, and the amount of the registered trademarks for counterfeit goods is less than the standard stipulated in the first paragraph of this article, but the sum of the illegal income from the counterfeit registered service trademarks reaches the standard prescribed in the second paragraph of this article, it shall be determined as the “serious circumstances” stipulated in Article 213 of the Criminal Law.

  Where the amount of illegal gains or illegal business operations reaches ten times or more the standard stipulated in the first three paragraphs of this article, it shall be determined as “especially serious circumstances” as stipulated in Article 213 of the Criminal Law.

Regarding trademarks, other Articles explain what “the same commodity or service” are and how to determine if a trademark is basically indistinguishable from the counterfeited registered trademark, etc.

Other criminal thresholds for trademark counterfeiting are also listed in the Interpretation.

The Interpretations also cover patent counterfeiting, copyright infringement and trade secret theft.

The full text is available here (Chinese only).  Comments are due March 5, 2023.

Author: Aaron Wininger

Aaron Wininger is a Principal and Director of the China Intellectual Property at Schwegman Lundberg & Woessner.

Author: Aaron Wininger

Aaron Wininger is a Principal and Director of the China Intellectual Property at Schwegman Lundberg & Woessner.