Taiwan: Taiwan passes Amendments to the Copyright Act, Trademark Act and Patent Act to strengthen IP protection

In brief

Joining the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) is important for Taiwan as it works towards promoting the collective prosperity of the Asia-Pacific region. As part of the preparation to join the CPTPP, Taiwan lawmakers have passed amendments to the Copyright Act, Trademark Act and Patent Act on 15 April 2022.

The new legal framework for intellectual property rights is intended to meet the standards set out in the CPTPP free trade agreement, modernize its laws, and improve protections for intellectual property rights owners.


Contents

Below is an overview of the amendments to the laws:

  1. Amendment to the Copyright Act

The Amendment to the Copyright Act amends six provisions of the Copyright Act, which will have an impact on the current copyright enforcement practice in Taiwan.

Under the amended laws, prosecutors have additional grounds to initiate investigations into alleged copyright infringements, including instances where the pirated materials are not available for free, are reproduced in their original form and the piracy causes financial damage of at least TWD 1 million (approximately USD 4,316).

The CPTPP agreement stipulates that criminal procedures and penalties will apply in certain cases of willful trademark counterfeiting or copyright piracy. As such, the amended Copyright Act will allow prosecutors to investigate a wider range of copyright infringements, which previously could only be brought by rights holders in a criminal court.

Although certain legal requirements have to be complied with, the Copyright amendment provides prosecutors the additional authority to take action over online copyright piracy, while still giving copyright holders the right to file private criminal complaints to seek protection. Therefore, the amended Copyright Act demonstrates the Taiwan government’s determination to combat copyright infringement.

  1. Amendment to the Trademark Act

To enhance trademark protection in Taiwan, the Trademark Act has been amended to include criminal provisions for counterfeiting labels of trademarks or collective trademarks. Criminal liability is now applied to certain preparatory and contributory acts of infringement, which include the importation of counterfeit labels and counterfeit packaging materials. Prior to the amended law, the alleged infringement involving the use of counterfeit labels required that the acts be carried out "knowingly." This requirement has been removed. The civil liability aspect will now be decided based on the presence (or absence) of "intention" and "negligence," while criminal liability will be determined based on "intention." The amendment has therefore eased the burden of proof for a trademark owner to prove the alleged infringing acts.

  1. Amendment to the Patent Act

The amendment to the Patent Act establishes a more comprehensive legal mechanism for disputes over generic drugs, which currently fall under the Pharmaceutical Affairs Act.

A Patent Linkage System, which was implemented in Taiwan in 2019, establishes a mechanism for the early resolution of patent disputes between new drug and the generic drug manufacturers before the generic drug hits the market.

In the Patent Linkage System, when the applicant of the generic drug permit declares that the patent(s) associated with the new drug will be revoked, or will not be infringed by the generic drug ("P4 Declaration"), the applicant should notify the holder of the new drug permit and the Taiwan Food and Drug Administration (TFDA). The holder of the new drug permit may opt to file a patent infringement lawsuit within 45 days from the date of receipt of the above notice, and notify the TFDA of such filing. The TFDA will stay the issuance of the generic drug permit for 12 months from the date of the new drug permit holder's receipt of the above notice of potential patent disputes.

The amendment to the Patent Act further endows the holder of the new drug permit with a basis for filing for injunctive relief when the P4 Declaration is filed in Patent Linkage System. If the holder of the new drug permit does not file a patent infringement lawsuit within the statutory period, the amendment to the Patent Act also endows the applicant of the generic drug permit with a basis for filing a lawsuit for declaratory judgment whether the patent(s) associated with the new drug will be revoked or the generic drug will not infringe the patent(s).

In other words, the amended Patent Act provides legal grounds for patent owners of new drugs to file a case against generic drug manufacturers in court. It also protects generic drug manufacturers if patent owners fail to file a legal case within a certain period of time or if the generic drug manufacturer obtains a declaratory judgment for non-infringement from the court.

The effective date of these amendments will be determined and announced by the Executive Yuan.


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