China to set up system of punitive compensation for IP infringements

China plans to set up a system of punitive compensation for intellectual property (IP) infringements, according to a draft government regulation.

The draft regulation on implementing the Foreign Investment Law, drawn up by the Ministry of Justice and a number of other State Council ministries, was posted online to solicit public opinions.

According to the draft, China will also push for establishing a fast-track IP protection mechanism, improve the mechanisms to resolve IP disputes through multiple means and provide assistance, and increase IP protection for foreign investors and enterprises.

The draft made detailed stipulations on banning the use of administrative measures to force foreign investors or enterprises to transfer technology.

Administrative entities and their staff are also required to strictly keep foreign-invested enterprises' business secrets they come to know about while performing their duties, according to the draft.

Members of the public can submit their opinions through letters, e-mails, or on the website of the Ministry of Justice by Dec. 1, 2019.

The Foreign Investment Law is slated to go into effect on the first day of 2020.