Air conditioner companies join hands to strengthen protection

Updated: Nov 2, 2017 By Zhang Zhao China Daily Print

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Gree, Midea and others establish industry's first alliance, echoing national strategies

Despite an ongoing patent fight between Gree and Midea - both leading Chinese home appliances manufacturers - the two companies have joined hands to protect the intellectual property rights of the entire air conditioner sector, establishing the first IP rights alliance for the industry in China.

Other founding members of the alliance include Haier, TCL, Hisense, Changhong and Aux, all big names in the industry.

The establishment of the alliance echoes the national strategies of building a strong IP powerhouse and an innovation-driven economy, and will promote the integration of the industry's development and IP, said Chen Jingliang, deputy secretary-general of the newly formed China Refrigeration and Air Conditioning Industry Association. He made the comments at the alliance's launch ceremony last week in Zhuhai, Guangdong province.

Liu Hua, deputy chief engineer of Gree and the first director-general of the alliance, called on the entire industry to "join hands to build a firewall".

"Gree hopes the alliance will guide the industry to respect IP rights, regulate competition order in the air conditioner market, promote patent operation, coordinate patent disputes and licensing among its members, and provide analysis on industrial development trends," Liu said.

Gree has so far filed more than 30,000 patent applications. Last year, it filed more than 3,000 applications and was granted 871 patents. Both numbers are the highest among Chinese home appliances manufacturers.

In June, the company filed a patent lawsuit against its competitor Midea with the Beijing Intellectual Property Court, asking for 50 million yuan ($7.6 million) in damages from the latter.

Midea sued Gree in Suzhou, Jiangsu province, and Guangzhou, capital of Guangdong, seeking a combined 50 million yuan in damages in another four patent cases.

Hong Shibin, executive director of the marketing committee of the China Household Electrical Appliance Association, said the patent wrangle between the two giants is the result of increasingly intense competition in the air conditioner market.

"However, the two companies are now standing side by side, showing that home appliance giants have an urgent need for patent protection," he said.

On many occasions, Gree's President Dong Mingzhu has called for greater efforts against patent infringement, counterfeiting and piracy, as well as for higher compensation, so that people will be encouraged to innovate and can enjoy the benefits of IP rights.

"Related laws in China are being improved," said Zang Xiaoli, a lawyer at Beijing-based Yingke Law Firm. "Shortened patent lawsuit hearing periods and more punitive compensation must be the future trends in legislation.

"At the same time, patent wars among leaders in the same businesses will intensify, as the companies are paying increasing attention to proprietary innovation and IP protection."

The fourth revision of the nation's Patent Law is expected to finish within the year, insiders said.

zhangzhao@chinadaily.com.cn