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Section 01 / Executive Briefing
- Fa Shi [2026] No. 7 is now in force. The revised SPC Punitive Damages Interpretation took effect May 1, 2026. From this date, all IP civil litigation proceedings in China are governed by the new willfulness criteria, procedural timing requirements, and damages methodology. Any pending case strategy that has not been reviewed against the new framework requires urgent attention.
- CNIPA formalises the patent quality imperative. The April 29 Annual Work Guidelines for Strong IP Nation (2026) elevate patent quality and commercialisation over filing volume across all institutions. Fabricated patents are now classified as research misconduct. Dormant university patents face active mobilisation requirements. SEP capabilities are given specific policy support.
- USTR places China on 2026 Special 301 Priority Watch List. The April 30 report cites continuing concerns over technology transfer, trade secrets, counterfeiting, online piracy, bad-faith trademarks, and pharmaceutical data protection. China remains subject to ongoing Section 306 monitoring. The report also moves the EU onto the Watch List — a notable development for rights holders managing EU-China dual portfolios.
- China Customs 2025 enforcement cases: FIFA World Cup IP, AI-driven seizures, e-commerce evasion. The April 23 release (discussed this week) documents new enforcement themes including an intelligent infringement detection model, criminal referral linkages, and border enforcement preparations specifically for the FIFA 2026 World Cup — with over 75 million infringing items seized in 2025.
- Major cross-border e-commerce platforms upgrade brand entry standards in May. Tmall Global, Douyin Global, and JD Worldwide have implemented unified brand authentication and listing requirements, targeting "fake foreign brand" products — with direct implications for IP verification and enforcement on these channels.
- Software copyright pledge filings go fully digital. Since April 15, the China Copyright Protection Centre no longer accepts paper software copyright pledge applications. All filings must now be submitted online, with electronic certificates only. Companies using Chinese software copyrights as loan collateral must update their closing workflows immediately.
6
Mainland China
1
Hong Kong SAR
1
Taiwan
—
Macau SAR
02
Legislation & Policy
Mainland China
CNIPA Guidelines
April 29, 2026
CNIPA Strong IP Nation Annual Work Guidelines (2026) — Patent Quality Formalised as Binding Metric; Dormant Patents and SEPs Targeted
CNIPA released the Annual Work Guidelines for Demonstration and Creation of a Strong Intellectual Property Nation (2026) on April 29. The document operationalises the 2021–2035 Strong IP Nation Outline by translating its long-term goals into specific 2026 tasks assigned across ministries, agencies, and judicial bodies. Several provisions carry direct operational implications.
Patent quality as a binding metric. The Guidelines formally extend the shift away from quantity-based patent metrics to every institutional evaluation pathway — project review, enterprise recognition, talent assessment, and academic title evaluation must all now emphasise patent quality and industrialisation prospects over raw filing numbers. Crucially, pre-filing evaluation mechanisms centred on commercialisation prospects are to be implemented across universities, research institutions, and enterprises. Fabricated patents and irregular inventorship are explicitly designated as research misconduct, with coordinated enforcement responses expected.
Dormant patent mobilisation. The Guidelines continue the patent commercialisation initiative, with specific direction to industrialise dormant patents held by universities and research institutions — a long-standing structural challenge in China's innovation system where large patent portfolios exist largely unused. Patent pool development and IP operation centres in key industries are to be advanced.
SEP and standard policy. The Guidelines specifically promote the Guidelines on Patent Policy for Standards to strengthen China's standard-essential patent capabilities — a direct response to the ongoing global negotiation over SEP licensing terms and FRAND determination standards. This signals continued policy investment in ensuring Chinese companies' SEP positions are strategically managed and commercially exploited.
Patent quality as a binding metric. The Guidelines formally extend the shift away from quantity-based patent metrics to every institutional evaluation pathway — project review, enterprise recognition, talent assessment, and academic title evaluation must all now emphasise patent quality and industrialisation prospects over raw filing numbers. Crucially, pre-filing evaluation mechanisms centred on commercialisation prospects are to be implemented across universities, research institutions, and enterprises. Fabricated patents and irregular inventorship are explicitly designated as research misconduct, with coordinated enforcement responses expected.
Dormant patent mobilisation. The Guidelines continue the patent commercialisation initiative, with specific direction to industrialise dormant patents held by universities and research institutions — a long-standing structural challenge in China's innovation system where large patent portfolios exist largely unused. Patent pool development and IP operation centres in key industries are to be advanced.
SEP and standard policy. The Guidelines specifically promote the Guidelines on Patent Policy for Standards to strengthen China's standard-essential patent capabilities — a direct response to the ongoing global negotiation over SEP licensing terms and FRAND determination standards. This signals continued policy investment in ensuring Chinese companies' SEP positions are strategically managed and commercially exploited.
Universities, research institutions, and enterprises receiving government grants or IP-related subsidies in China should audit their patent portfolios against the new quality criteria now. Filing volume alone will no longer satisfy evaluation requirements — demonstrable commercialisation pathways are required. Companies holding licences from Chinese university portfolios should also note the push for dormant patent activation, which may prompt outbound licensing campaigns.
Mainland China
Cross-Border E-Commerce
Trademark · Brand
May 2026 (effective)
Tmall Global, Douyin Global and JD Worldwide Implement Unified Brand Entry Standards — "Fake Foreign Brand" Crackdown Accelerates
Starting May 2026, China's three largest cross-border e-commerce import platforms — Tmall Global, Douyin Global (TikTok Shop China), and JD Worldwide — have implemented a unified upgrade to brand entry and ongoing operating standards, with the stated purpose of eliminating "fake foreign brands": products marketed and sold as imported goods that are actually domestically manufactured and owned, misrepresenting their origin to exploit Chinese consumer preference for foreign products.
The upgraded standards require stricter documentation of brand ownership (including trademark registrations in relevant jurisdictions), supply chain origin verification, and ongoing monitoring of listing accuracy. For genuine foreign brands selling into China through these channels, the new requirements create additional IP verification obligations at the point of market entry — but also strengthen enforcement against domestic imitators and origin misrepresentation. For Chinese companies that have used offshore registration structures to simulate foreign brand status, the new standards represent a significant compliance risk and potential delisting exposure.
The development comes against a backdrop of rapid cross-border e-commerce growth: China's Ministry of Commerce confirmed that import/export volume through these channels reached RMB 2.75 trillion in 2025, a 69.7% increase from 2020, with Q1 2026 alone reaching RMB 618 billion. The scale makes IP verification in this channel a strategically important consideration for any brand with Chinese online sales.
The upgraded standards require stricter documentation of brand ownership (including trademark registrations in relevant jurisdictions), supply chain origin verification, and ongoing monitoring of listing accuracy. For genuine foreign brands selling into China through these channels, the new requirements create additional IP verification obligations at the point of market entry — but also strengthen enforcement against domestic imitators and origin misrepresentation. For Chinese companies that have used offshore registration structures to simulate foreign brand status, the new standards represent a significant compliance risk and potential delisting exposure.
The development comes against a backdrop of rapid cross-border e-commerce growth: China's Ministry of Commerce confirmed that import/export volume through these channels reached RMB 2.75 trillion in 2025, a 69.7% increase from 2020, with Q1 2026 alone reaching RMB 618 billion. The scale makes IP verification in this channel a strategically important consideration for any brand with Chinese online sales.
Foreign brand owners selling through Tmall Global, Douyin Global, or JD Worldwide should review their current documentation packages for compliance with the new entry standards before their next listing renewal. This includes ensuring trademark registrations in China are current, that country-of-origin documentation for products is accurate and verifiable, and that brand guidelines are actively enforced against third-party sellers on the same platforms.
03
Enforcement & Administration
International · US-China
USTR Special 301
April 30, 2026
USTR 2026 Special 301 Report: China Retained on Priority Watch List — Technology Transfer, Trade Secrets, and Counterfeiting Flagged
The Office of the United States Trade Representative released the 2026 Special 301 Report on April 30, its annual assessment of IP protection and enforcement across more than 100 trading partners. China retains its Priority Watch List status and remains subject to ongoing monitoring under Section 306 of the Trade Act of 1974 — a designation it has held for many years.
The 2026 report identifies continuing concerns in the following areas with respect to China: technology transfer (including forced transfer conditions and regulatory mechanisms that disadvantage foreign IP holders); trade secret protection (despite legislative improvements, concerns about adequacy of enforcement remain); counterfeiting and online piracy (including cross-border e-commerce channels); patent and related policies (including patent linkage and pharmaceutical data protection implementation); bad-faith trademark filings; and geographical indications.
Notable changes in the 2026 report: Vietnam was designated as a Priority Foreign Country for the first time in 13 years, triggering a potential Section 301 investigation. Argentina and Mexico were moved to the less serious Watch List following IP improvements. In a development of significance for European-facing rights holders, the European Union was added to the Watch List for the first time, reflecting USTR's concerns over EU pharmaceutical legislation and geographical indication issues. USTR Ambassador Jamieson Greer signalled intent to use enforcement tools actively to address unfair IP trade practices, including through the ongoing Reciprocal Trade Agreement negotiation process.
The 2026 report identifies continuing concerns in the following areas with respect to China: technology transfer (including forced transfer conditions and regulatory mechanisms that disadvantage foreign IP holders); trade secret protection (despite legislative improvements, concerns about adequacy of enforcement remain); counterfeiting and online piracy (including cross-border e-commerce channels); patent and related policies (including patent linkage and pharmaceutical data protection implementation); bad-faith trademark filings; and geographical indications.
Notable changes in the 2026 report: Vietnam was designated as a Priority Foreign Country for the first time in 13 years, triggering a potential Section 301 investigation. Argentina and Mexico were moved to the less serious Watch List following IP improvements. In a development of significance for European-facing rights holders, the European Union was added to the Watch List for the first time, reflecting USTR's concerns over EU pharmaceutical legislation and geographical indication issues. USTR Ambassador Jamieson Greer signalled intent to use enforcement tools actively to address unfair IP trade practices, including through the ongoing Reciprocal Trade Agreement negotiation process.
The 2026 Special 301 Report has practical enforcement implications beyond its symbolic significance. Priority Watch List designation under Section 306 monitoring creates a baseline for potential Section 301 trade actions. Foreign companies navigating China IP issues — particularly in technology licensing, pharmaceutical patents, and online platform enforcement — should factor the current US-China IP enforcement climate into their strategic risk assessments, including for cross-border technology transfer transactions now subject to CNIPA's new export control directive.
Mainland China
Customs Enforcement
Released April 23, 2026
China Customs Releases 2025 Typical IP Cases — AI Seizure Models, FIFA World Cup Enforcement, and Cross-Border E-Commerce Evasion Tactics Documented
The General Administration of Customs released its annual compilation of Typical Cases of Intellectual Property Protection by China Customs in 2025, covering ten enforcement matters across trademark, copyright, and design patent infringement at export, import, mail, and border trade channels. The cases span customs offices in more than 20 cities including Nanjing, Shenzhen, Guangzhou, Shanghai, and Beijing.
Smart Customs AI model. Multiple cases in the compilation document the operational deployment of an intelligent infringement risk identification model under CNIPA's Smart Customs initiative — using algorithmic risk scoring to flag suspicious shipments for physical inspection. This represents a material shift from reactive to predictive enforcement at the border.
Administrative-criminal linkage. Cases illustrate the use of the "administrative and criminal law linkage" mechanism to transfer cases exceeding criminal thresholds directly to public security authorities — accelerating enforcement escalation in serious matters.
FIFA World Cup 2026 enforcement. Customs offices have deployed special actions targeting counterfeit merchandise related to the FIFA World Cup 2026 — jerseys, official emblems, mascot products, and sponsor brand goods — at both export and import channels. This enforcement posture will be maintained through the tournament period.
Documented evasion methods. The release includes unusually frank documentation of evasion tactics used by infringing exporters: declaring goods as "unbranded," misrepresenting product categories (e.g. declaring razors as "lighting fixtures"), and fabricating "daigou" personal-shopping receipts and logistics documents to characterise commercial shipments as personal purchases.
Smart Customs AI model. Multiple cases in the compilation document the operational deployment of an intelligent infringement risk identification model under CNIPA's Smart Customs initiative — using algorithmic risk scoring to flag suspicious shipments for physical inspection. This represents a material shift from reactive to predictive enforcement at the border.
Administrative-criminal linkage. Cases illustrate the use of the "administrative and criminal law linkage" mechanism to transfer cases exceeding criminal thresholds directly to public security authorities — accelerating enforcement escalation in serious matters.
FIFA World Cup 2026 enforcement. Customs offices have deployed special actions targeting counterfeit merchandise related to the FIFA World Cup 2026 — jerseys, official emblems, mascot products, and sponsor brand goods — at both export and import channels. This enforcement posture will be maintained through the tournament period.
Documented evasion methods. The release includes unusually frank documentation of evasion tactics used by infringing exporters: declaring goods as "unbranded," misrepresenting product categories (e.g. declaring razors as "lighting fixtures"), and fabricating "daigou" personal-shopping receipts and logistics documents to characterise commercial shipments as personal purchases.
Brand owners exporting from or importing into China should register their IP rights with China Customs' IP rights recordal system (if not already done) and update their anti-counterfeiting training materials for customs officers to include the latest product authentication methods. The documented evasion tactics — particularly false "unbranded" declarations and product misclassification — are also relevant indicators for brands monitoring their own supply chains for grey market and diversion activity.
04
Courts & Key Decisions
Mainland China
✓ Now in Force
SPC · Punitive Damages
Effective May 1, 2026
Fa Shi [2026] No. 7 — SPC Punitive Damages Interpretation — IN FORCE FROM MAY 1, 2026
Punitive Damages Interpretation Now Operative — Immediate Compliance Implications for All Active and Planned IP Litigation in China
The Interpretation on the Application of Punitive Damages in the Trial of Civil Disputes Involving Intellectual Property Infringement (Fa Shi [2026] No. 7) entered into force on May 1, 2026, as scheduled. First adopted by the SPC Judicial Committee on April 7 and published on April 20, the interpretation supersedes Fa Shi [2021] No. 4 in its entirety. All IP civil infringement proceedings commenced from this date — and all first-instance proceedings still in progress — are now governed by the new framework.
Key provisions now operative:
Timing of claims. A claim for punitive damages must be raised before the conclusion of first-instance oral argument. Claims first raised on appeal will not be supported on the merits; the court may conduct mediation with punitive damages in view, but if mediation fails the new claim will not proceed. This timing rule is absolute and requires immediate action on pending matters.
Willfulness standards. Courts must now assess willfulness by reference to: (a) the nature and status of the IP right at issue; (b) the notoriety of the right; and (c) the prior relationship between the parties. This structured approach replaces a more discretionary inquiry and creates a higher and more predictable evidential standard for both rights holders seeking punitive awards and defendants contesting them.
Serious circumstances — two new categories. Post-settlement recidivism (resuming identical or substantially similar conduct after a settlement undertaking) and concealment of actual control through affiliated entities, nominees, or indemnity arrangements are now expressly designated as bases for punitive enhancement. Both directly target the most common defendant mitigation tactics in prior proceedings.
Damages base methodology. Where neither actual loss nor infringer profit can be precisely established, the interpretation provides a structured methodology for constructing the damages base — closing the information asymmetry gap that previously allowed sophisticated defendants to benefit from opacity.
The practical impact will take months to crystallise in published decisions. However, rights holders with pending claims should have already pleaded punitive damages at first instance; those who have not and whose cases are still in oral argument must act immediately.
Key provisions now operative:
Timing of claims. A claim for punitive damages must be raised before the conclusion of first-instance oral argument. Claims first raised on appeal will not be supported on the merits; the court may conduct mediation with punitive damages in view, but if mediation fails the new claim will not proceed. This timing rule is absolute and requires immediate action on pending matters.
Willfulness standards. Courts must now assess willfulness by reference to: (a) the nature and status of the IP right at issue; (b) the notoriety of the right; and (c) the prior relationship between the parties. This structured approach replaces a more discretionary inquiry and creates a higher and more predictable evidential standard for both rights holders seeking punitive awards and defendants contesting them.
Serious circumstances — two new categories. Post-settlement recidivism (resuming identical or substantially similar conduct after a settlement undertaking) and concealment of actual control through affiliated entities, nominees, or indemnity arrangements are now expressly designated as bases for punitive enhancement. Both directly target the most common defendant mitigation tactics in prior proceedings.
Damages base methodology. Where neither actual loss nor infringer profit can be precisely established, the interpretation provides a structured methodology for constructing the damages base — closing the information asymmetry gap that previously allowed sophisticated defendants to benefit from opacity.
The practical impact will take months to crystallise in published decisions. However, rights holders with pending claims should have already pleaded punitive damages at first instance; those who have not and whose cases are still in oral argument must act immediately.
This is a hard deadline. Any Chinese IP infringement proceeding at first instance where punitive damages are available and have not yet been formally pled must be reviewed by counsel this week. Once oral argument concludes, the claim cannot be added. Defendants in ongoing proceedings should simultaneously review whether their litigation or compliance structures fall within the two new "serious circumstances" categories — and seek advice on restructuring if they do.
Mainland China
Copyright
Digitalisation
Effective April 15, 2026
Software Copyright Pledge Filings Go Fully Digital — Paper Applications Discontinued; Electronic Certificates Only
Effective April 15, 2026, the China Copyright Protection Centre (CCPC) no longer accepts paper applications — whether in person or by mail — for software copyright pledge (security interest) registrations. All filings must now be submitted through the CCPC's online platform, and certificates will be issued exclusively in electronic form.
Software copyright pledges are a widely used instrument in China's IP financing market, enabling software companies to use their registered copyrights as collateral for bank loans and other credit facilities. The transition to fully digital processing is operationally straightforward for most filers, but it has direct compliance implications for security interest documentation and lender closing checklists: any transaction that previously relied on a paper certificate as evidence of pledge registration now requires an updated process for obtaining and verifying the electronic certificate from the CCPC's system.
Finance teams and legal counsel at Chinese software companies, as well as lenders and investors who accept software copyright pledges as security, should confirm that their internal transaction workflows, standard form pledge agreements, and certificate verification procedures have been updated to reflect this change.
Software copyright pledges are a widely used instrument in China's IP financing market, enabling software companies to use their registered copyrights as collateral for bank loans and other credit facilities. The transition to fully digital processing is operationally straightforward for most filers, but it has direct compliance implications for security interest documentation and lender closing checklists: any transaction that previously relied on a paper certificate as evidence of pledge registration now requires an updated process for obtaining and verifying the electronic certificate from the CCPC's system.
Finance teams and legal counsel at Chinese software companies, as well as lenders and investors who accept software copyright pledges as security, should confirm that their internal transaction workflows, standard form pledge agreements, and certificate verification procedures have been updated to reflect this change.
If your organisation has outstanding software copyright pledge arrangements that were established with paper certificates, verify with your counsel whether re-registration or certificate replacement is required under the new system. For new pledge transactions, update template closing checklists to specify electronic certificate retrieval from the CCPC portal as a condition precedent to disbursement.
05
Industry, Market & Emerging Issues
Hong Kong SAR
IP Finance · Arbitration
Late April – May 2026
Hong Kong Advances IP Securitisation and Arbitration Positioning as Mainland IP Asset Values Surge
As the full implications of China's 5-million-patent milestone and expanding IP securitisation market (RMB 37 billion+ in products disclosed at the April 23 press conference) begin to register across the financial community, Hong Kong's position as the natural bridging jurisdiction for Chinese IP assets seeking international financing and dispute resolution is receiving renewed attention. The Hong Kong Monetary Authority and the Intellectual Property Department have been coordinating on frameworks that would allow Hong Kong-based financial institutions to develop more standardised products for lending against Chinese patent and copyright portfolios — leveraging Hong Kong's common law contract certainty, its deep capital markets, and its close regulatory relationship with Mainland financial regulators through the Greater Bay Area framework. Simultaneously, HKIAC's IP arbitration infrastructure continues to be developed as the preferred neutral venue for IP licensing disputes between Mainland originators and international licensees, a category of dispute that is growing as Chinese companies' outbound licensing activity accelerates.
Taiwan
Patent · Semiconductor
May 2026 (ongoing)
Taiwan TIPO Advances AI-Assisted Patent Examination; Semiconductor IP Filings Sustain Record Pace Amid US-China Technology Decoupling
Taiwan's Intellectual Property Office continues to roll out AI-assisted examination tools for patent applications in semiconductor, advanced packaging, and chip design domains — areas where TIPO has accumulated deep technical expertise and where global filing volumes are surging as the US-China technology decoupling accelerates innovation investment in Taiwan's supply chain ecosystem. The AI tools are designed to assist examiners in prior art searches and claim analysis in highly technical fields where examination quality and speed are both at a premium. TIPO is simultaneously monitoring the downstream IP implications of CNIPA's USTR-flagged practices on technology transfer — a structural tension relevant to the many Taiwanese companies with dual Mainland and Taiwan patent portfolios, which must navigate both jurisdictions' increasingly divergent treatment of cross-border IP flows.
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Macau SAR
MacauApril 27 – May 3, 2026
No significant IP policy, legislative, or enforcement announcements were issued by Macao's Economic and Technological Development Bureau (DSEDT) during this reporting period. IP registration and enforcement continue as normal. For Macau-specific IP matters, please contact foridom@foridom.com.
📅 Upcoming Dates & Key Deadlines
May 1 ✓
Fa Shi [2026] No. 7 now in force. Review all pending Chinese IP civil proceedings for punitive damages pleading compliance — no further extensions possible. In Force
Jun 1
SAMR Trade Secret Protection Regulations take effect — administrative enforcement channel; injunctions and fines up to RMB 5 million. Begin internal trade secret audit and protection documentation review now. China
H2 2026
Trademark Law (Amendment) — second NPC Standing Committee reading expected. New provisions on "misleading use" and bad-faith applications under close watch. China
Ongoing
FIFA World Cup 2026 IP enforcement — China Customs maintaining heightened border measures for counterfeit merchandise through the tournament period. China
Ongoing
CNIPA 2026 Patent Agency Rectification Campaign (joint with Ministry of Public Security) — increased regulatory scrutiny on patent filing agents; monitor for impacts on filing timelines and agent relationships. China
Ongoing
Cross-border e-commerce brand entry standards (Tmall Global, Douyin Global, JD Worldwide) — ongoing compliance verification required for all foreign brands on these platforms. China
Publication
Greater China IP Watch, Issue No. 04
Reporting period: April 27 – May 3, 2026
Published: Monday, May 4, 2026
Reporting period: April 27 – May 3, 2026
Published: Monday, May 4, 2026
Prepared & Proofread by
Foridom IP Law Firm (百一知识产权)
Proofread by: Wiky Wang, Attorney at Law
Proofread by: Wiky Wang, Attorney at Law
Contact & Subscriptions
foridom@foridom.com
For subscription, feedback, or IP enquiries
For subscription, feedback, or IP enquiries
Coverage & Sources
Mainland China · Hong Kong SAR · Taiwan · Macau SAR
Primary: CNIPA, SPC, USTR, GACC, TIPO, IPD, DSEDT
Media: chinaiplawupdate.com, IAM, Managing IP, NLR, USTR.gov
Primary: CNIPA, SPC, USTR, GACC, TIPO, IPD, DSEDT
Media: chinaiplawupdate.com, IAM, Managing IP, NLR, USTR.gov