Why Patent Legal Status Matters in China
When engaging Chinese partners or evaluating competitors, verifying a patent’s legal status is critical. A patent’s validity—whether it’s authorized, invalidated, pledged as collateral, or licensed—directly impacts IP security, investment decisions, and partnership risks. In China, where IP disputes surged by 15.7% in 2023 (CNIPA), due diligence is non-negotiable.
Key Patent Statuses & Verification Methods
1. Authorized Patents: Confirming Active Protection
- What It Means: The patent is legally enforceable. Rights include manufacturing, sales, and licensing.
- How to Verify:
- CNIPA’s Patent Search System (http://pss-system.cnipa.gov.cn): Enter the patent number to view:
- Authorization date
- Annual fee payment status (non-payment triggers termination).
- Critical Checks:
- Scope of protection (claims vs. actual product).
- Geographic coverage (China-only vs. international filings).
2. Invalidated Patents: Identifying Voided Rights
- Grounds for Invalidation: Lack of novelty, non-industrial applicability, or fraudulent claims (Patent Law, Art. 45).
- Verification Tools:
- CNIPA Invalidation Decisions Database: Lists patents voided by administrative rulings.
- Court Records: Check China Judgments Online for litigation outcomes.
- Red Flags:
- Patents invalidated over 6 months ago (no appeal window).
- Multiple invalidation petitions against one patent.
3. Pledged Patents: Uncovering Hidden Liabilities
- Risks: Pledged patents can be liquidated if the owner defaults.
- Search Process:
- National IP Pledge Registry: Accessible via China’s Credit Reference Center.
- Key Details to Confirm:
- Pledge duration.
- Secured debt value.
- Creditor’s rights (e.g., exclusive licensing).
- Case Example: In 2022, a Shenzhen tech firm’s patent pledge led to creditor seizure after loan default.
4. Licensed Patents: Tracking Usage Rights
- License Types:
- Exclusive (licensee-only rights).
- Non-exclusive (multiple parties).
- Compulsory (government-mandated, e.g., public health crises).
- Verification Channels:
- CNIPA Patent License Recordal Platform: Validate registered licenses.
- Cross-Check: License terms vs. actual product exploitation.
Step-by-Step Verification Workflow
- Gather Patent Details: Numbers, applicant name, filing date.
- Use CNIPA’s Systems:
- Patent Search for status.
- Pledge/License Registries for encumbrances.
- Third-Party Reports: For complex portfolios, use authoritative Enterprise Credit Reports to uncover associated risks (e.g., parent company litigation).
- Legal Counsel Review: Validate findings with local IP experts.
💡 Tip: Always verify translations. English patent titles in CNIPA databases may not match Chinese originals.
Why Overlooked Status Checks Cause Business Risks
- Scenario 1: Acquiring a “valid” patent later invalidated for prior art → Loss of R&D investment.
- Scenario 2: Unreported pledge → Asset seizure post-M&A deal.
- Solution: Integrate patent checks into broader due diligence, like reviewing a company’s Financial & Tax Reports for R&D consistency.
Partner with Confidence
Navigating China’s patent landscape demands precision. While public tools offer baseline data, complex cases require expert verification. At ChinaBizInsight, we combine official CNIPA data with deep-dive analysis—from patent validity to corporate credibility—ensuring your partnerships begin on solid ground.
🔍 Need to Verify a Chinese Patent?
Explore Our Intellectual Property Verification Services