How to Protect

your Intellectual Property

at Trade Fairs?

Valentin de le Court

vdlc@daldewolf.com

12 March 2020

PART I - IP In China, The Context

PART II - How to protect your IP at trade fairs?

2.1. – PLAN AHEAD: protecting your IP requires preparation BEFORE the trade fair

2.2. – Protecting IP when ATTENDING THE FAIR

2.3. – Protecting IP when FOLLOWING-UP on the trade fair

PART III – To Conclude

AGENDA

PART I - IP IN CHINA, THE

CONTEXT

1° In ONLY THREE DECADES → from no man's land to top national priority

4

2019 - IP IS A TOP NATIONAL PRIORITY

1978NO IP LAWS

2°A WIPO member + part to main IP international treaties and agreements

3°A COMPLETE SET OF CHINESE IP LAWS IN PLACE

#1 - EVOLUTION OF IP LAWS IN CHINA

EVOLUTION

CHINA IS PART OF THE WORLD

IP ORDER

#2 - China is the No. 1 country for PATENT and

TRADEMARK APPLICATIONS

▪ 1.101.864 CN invention patent applications in 2015 (+18.7%)

>< 279 000 EP patent application in 2015 (+1,6% )

▪ ‘WIPO Indicators 2016’: China makes the headlines (FT Nov.24, 2016)

DOMESTIC FILINGS

▪ 1.542.500 CN invention patent applications in 2018

#3 - China is the No. 2 country for PCTAPPLICATIONS in 2017

INTERNATIONALISATION

PCT applicant #1

and #2 were

Chinese: Huawei

and ZTE

(2018 WIPO

Statistics)

7

#4 - China is THE MOST IP LITIGIOUS COUNTRY

in the world since 2005

▪ 16,010 patent litigation cases in 2017 >< maybe 50 in Belgium

(?)

▪ IP litigation cases are mostly domestic (CN >< CN): 96%

between 2011 to 2014

▪ Increase in cases involving foreign businesses

➢ More cases against foreign businesses

➢ More cases between foreign businesses

TOP IP LITIGATION COUNTRY

#5 - 13th FIVE-YEAR PLAN for 2016-2020 (Oct.2015)

➢ From ‘made in China’to ‘created in China’

Strategic importance of innovation (a

pillar for the future development of CN)

Five guiding principles

IP = A POLITICAL IMPERATIVE

“[W]e will intensify efforts to enhance international cooperation in intellectual property protection. Without innovation, there will be no progress. Full intellectual property protection will not only ensure the lawful rights and interests of Chinese and foreign companies; it is also crucial to promoting China’s innovation-driven and quality development.” – President Xi Jinping, Belt and Road Forum, April 26, 2019

▪ China is already an important innovation

center

▪ More foreign companies opening R&D centers

in CN

➢ Product localisation

➢ Innovating for global markets

#6 - R&D spending in China grew tenfold

between 2000 and 2016

THE STATE OF INNOVATION

Source: The Economist 12-18 Jan.2019

Will this change with the ongoing trade war?

WHAT CAN WE LEARN from these facts & figures?

1. The Chinese (IP) landscape has CHANGED

https://thediplomat.com

LEARNINGS

2. It is possible to PROTECT your IP rights in China

➢ Complete and advanced legal system for protecting IP

➢ Widely used

➢ Accessible to foreign companies

3. It is possible to ENFORCE your IP rights in China

➢ CN companies → extensive use of the IP litigation system

➢ Available to foreign businesses

LEARNINGS

4. IPR IS NOW ESSENTIAL FOR CHINESE BUSINESSES

▪ More IP aware (IP = competitive advantage = value)

▪ More IP rich

▪ China’s stake in the IP system grows

➢ Political will to improve the IP system

➢ Call from the business to improve the system March 8, 2017

LEARNINGS

Part II – How to Protect

your Intellectual Property

at Trade Fairs?

BEFORE

1. IP audit

2. Know what to protect

3. Register

4. Layer your IP

5. Protect yourtrade secrets

6. Prepareenforcement docs

DURING

1. Inform

2. Disclose onlywhat is needed

3. Identifycounterfeits

4. Secure evidence

5. Enforce

AFTER

1. Select your leads

2. Background checks

3. Organize whatyou share

4. NDA, confidentialmarking,

HAVE A STRATEGY

2.1 – PLAN AHEAD: protecting

your IP requires preparation

BEFORE the trade fair

STEP 1 - KNOW YOUR IP: perform an IP audit & due diligence

➢ Intangible assets are non-physical (difficulty to identify)

➢ Often lack of overview of IP assets of the company

❖ Have a comprehensive overview of IP assets for products / technology to be presented

❖ Ascertain legal status, territorial coverage, value, related risks

➢ Align IP strategy with business strategy

❖ Are your products / technologies protected?

❖ How (IP or trade secrets)?

❖ Is the protection relevant businesswise (revenue streams)?

❖ In China?

→ Understand what to protect and how

STEP 2 - KNOW WHAT TO PROTECT AND HOW

Two ways to protect the results of your innovation(complementary role)

1. Intellectual Property Rights (‘IP’)➢ an exclusive right

2. Trade secrets (‘TS’)➢ protection based on

▪ The nature of the information

▪ The way the information is handled

➢ protection against illicit acts

3. Analyze products/technology to be exhibited &

take action

COMPETITIVE

ADVANTAGE

Patents

©

DesignsTRADE

SECRETS

TM

18

STEP 3 - Create a BUNDLE OF RIGHTS:different IPRs serve different goals

▪ Trademark Law - protect indication of origin of goods/ services

▪ Patent Law

➢ Invention patents and utility models protect technical featuresof a product/process

➢ Design patents protect the external aspect of products

▪ Copyright Law – creative works

▪ Trade secrets (anti-unfair Competition Law) – confidentialinformation

Layer your IP (!)

19

A same object can

be protected by

different types of

IP rights

20

Logo- TM + ©

Drawing-©

Photo- ©

Brand name – TM

Packaging as a whole - Trade Dress + ©

Shape of packaging- Design Patents

Product name- TM

Slogan– TM + ©

Pattern- Design Patents + ©

Label - Certification

mark

Packaging opening system – patents / utility models

Layer your IP (!)

21

STEP 4 - HAVE ENFORCEABLE IP RIGHTS

➢ TERRITORIALITY of IPR→ Cover countries where you trade,

manufacture, exhibit

➢ REGISTRATION is needed (!)❖ No automatic protection

❖ Register on time (anticipate, plan early)

❖ Not applying in China = FREE LICENSE to use your inventions

➢ ADAPT to the specificities of the CN IP system❖ E.g. design patents → no 1 year grace period / registration process of

national TMs is faster >< Madrid system

❖ Work with people who master the system

Be proactive!

22

STEP 5 – Protect your trade secrets

WHAT can be protected?

➢ Broad range of technical/commercial/operational information

➢ Technical know-how, technical drawings, product formula and

specifications, cost and price information, manufacturing

processes, production methods, etc.

CONDITIONS

1. SECRET - “unknown to the public” Art.9 CN AUCL

2. COMMERCIAL VALUE because it is secret - “can bring about economic benefits” Art.9 CN AUCL

3. REASONABLE STEPS to keep it secret - “has adopted secret-keeping measures” Art.9 CN AUCL

USA 2016

Defend Trade Secret Act

CHINA 2017 + 2019

Anti-unfair competition law revised

23

SHARED DEFINITION OF « TRADE SECRETS » (art.39 TRIPS; art.9 CN AUCL; art.2 Directive 2016/943)

UE 2016

Trade Secrets Directive 2016/943

BE 2018

BE law on Trade Secrets

Recent changes in the Chinese Anti-Unfair Competition Law (art.9 CN AUCL) → reinforced protection (but remains challenging)

➢ “has adopted secret-keeping measures” (Art.9 CN AUCL)

➢ Need to take proactive measures to protect secrecy (protection is not automatic)

➢ Key to ENFORCE trade secrets in China (and in the EU) : the first thing a judge will check!

➢ No reasonable steps = information is no trade secret →loss/ absence of protection

➢ Reasonable steps must be adopted at trade fairs (select

what you show and disclose, confidentiality markings, NDAs,…)

24

REASONABLE STEPS to keep information secret are KEY

25

STEP 6 – Prepare enforcement documentation in advance

Enforcement mechanisms at trade fairs: possibilityto enforce on the spot through trade fair IP Office

Have enforcement documents in place: may taketime

➢ Translated to CN

➢ Notarized and legalized

➢ Lawful and valid proof of intellectual property ownership

➢ POA in favor of CN lawyer (notarized and legalized)

26

Lawful and valid proof of intellectual property

ownership

➢ PATENTS: patent certificate + text of published patent +

identity document of the patentee (legalized, notarized,

translated certification of incorporation) + confirmation of legal

status + evidence of annuities paid

➢ TRADEMARK: trademark certificate (if IR → certificate from

CNIPA needed) + renewals + identity document of the

trademark owner

➢ COPYRIGHT: proof of copyright ownership (voluntary recordal

certificate) + identity document of the copyright owner

27

STEP 1 - KNOW YOUR IP: perform an IP audit

STEP 2 - KNOW WHAT TO PROTECT and how

STEP 3 - Create a BUNDLE OF RIGHTS: different IPRs serve different goals

STEP 4 - Have ENFORCEABLE IP RIGHTS

STEP 5 – Protect your TRADE SECRETS

STEP 6 – Prepare ENFORCEMENT DOCUMENTATION

KEY TAKE AWAYActions to take to Protect your IP BEFORE attending a trade fair

2.2. – Protecting your IP when

ATTENDING THE FAIR

Before

1. IP audit

2. Know what to protect

3. Register

4. Layer your IP

5. Protect yourtrade secrets

6. Prepareenforcement docs

During

1. Disclose onlywhat is needed

2. Inform

3. Identifycounterfeits

4. Secure evidence

5. Enforce

After

1. Select your leads

2. Background checks

3. Organize whatyou share

4. NDA, confidentialmarking,

HAVE A STRATEGY

30

STEP 1 – Disclose only what is needed

➢ How much of my IP should I disclose?

❖ Review and consider what materials you are displaying and

distributing

❖ Avoid novelty destroying publication (patents/ designs)

➢ Be aware of risks of trade secrets disclosure &

misappropriation

STEP 2 – NOTIFY visitors about your IP rights

+ “CONFIDENTIALITY” MARKINGS

32

STEP 3 – Identify counterfeiters

➢ Opportunity to discover and catch counterfeiters

➢ Check the list of exhibitors in advance (identify potential

counterfeiters; coordinate with local team/CN distributor if any)

➢ Research the exhibitors stands

➢ Approach counterfeiters undercover and collect evidence

(samples, pictures, name cards,…)

➢ Two options: (1.) enforce on the spot or (2.) collect evidence

for later action

33

STEP 4 – Secure evidence

➢ Often more sensible than immediate enforcement action

➢ Opportunity to legally collect evidence to support later

actions

➢ Prove your IPR has been infringed (importance of the

quality of evidence: in China evidence is everything!)

➢ Notarized evidence has strong probative force (formal

(1) Notarized purchases (i.e. purchasing of a sample of

counterfeit with public notary)

(2) Notarized evidence of the presence counterfeits (i.e. photos

of exhibition booth, infringing products / exhibits, infringing

advertisement, name cards, etc. with a public notary)

➢ Jurisdiction rules → forum shopping for later action

34

STEP 5 – IP enforcement at trade fairs

➢ Through the local IP office (can mediate, remove/cover;

seize; forward to admin enforcement agencies)

➢ Need all the documents and file in place:

❖ Lawful and valid proof of intellectual property ownership (the sta

rting point!)

❖ Basic information on alleged infringer (name, booth #)

❖ Evidence of infringement (samples + pictures + ecommerce)

❖ Complaint letter (legal ground)

❖ POA in favor of local lawyer (localized & legalized)

➢ Can be efficient if strong case and file (evidence) - e.g.

German car maker

➢ Can be tricky – e.g. SME medical device

2.3. – Protecting IP when

FOLLOWING-UP

on the trade fair

Before

1. IP audit

2. Know what to protect

3. Register

4. Layer your IP

5. Protect yourtrade secrets

6. Prepareenforcement docs

During

1. Disclose onlywhat is needed

2. Inform

3. Identifycounterfeits

4. Secure evidence

5. Enforce

After

1. Select your leads

2. Background checks

3. Organize whatyou share

4. NDA, confidentialmarking,

HAVE A STRATEGY

37

Carefully follow-up

1. Select your leads

2. Background checks

3. Organize what you share

4. Sign NDAs! (+ other confidentiality measures suchas confidential marking)

TO CONCLUDE

BEFORE

1. IP audit

2. Know what to protect

3. Register

4. Layer your IP

5. Protect yourtrade secrets

6. Prepareenforcement docs

DURING

1. Inform

2. Disclose onlywhat is needed

3. Identifycounterfeits

4. Secure evidence

5. Enforce

AFTER

1. Select your leads

2. Background checks

3. Organize whatyou share

4. NDA, confidentialmarking,

Key Take Away #1: HAVE A STRATEGY

Final Key Messages

1. The CN IP and INNOVATION landscape have CHANGED

2. OPPORTUNITIES for EU companies with tech./strong brands AND

an IP strategy

3. PLAN AHEAD: protecting your IP requires time, preparation, a

strategy → be proactive

4. DURING the fair: exploit the opportunities

5. Have strategy in YOUR FOLLOW-UP

How to protect your IP assets at trade fairs?

Valentin de le Court

• DALDEWOLF

• vdlc@daldewolf.com

Valentin de le Court is a Belgian qualified lawyer with close to fifteen years ofexperience in the intellectual property field, including four years of practice inChina. His area of expertise covers contentious and non-contentious IP mattersrelating to patents and trademarks, trade secrets protection and management,with a strong focus on China related IP strategies and technology transfer. Overthe past years Valentin has assisted European MNCs and SMEs active in a widerange of sectors (semiconductors, automotive, mobile gaming, oil & gas, digitalcommunication, F&B, fashion, medical device and design) with their China relatedIP issues. Today he co-heads the IP/IT team and leads the China Desk atDALDEWOLF, a full service Belgian business law firm. Valentin is fluent in French,Dutch and English.

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