The European Union (EU) launched a legal challenge against China at the World Trade Organization on February 18th, 2022, arguing that the Chinese courts were preventing European companies from protecting their telecom technology patents.
The European Commission, which filed the challenge on behalf of the EU’s 27 members, said that EU companies were being deterred from going to foreign courts to safeguard their standard-essential patents (SEPs)
Foreign Court Deterrent & Fines
SEP holders that go to court outside of China in order to protect such rights when their patents are used illegally or without appropriate compensation often face significant fines (examples include a €130,000 daily fine) or criminal charges (executives could be jailed in China for non-compliance) within the China jurisdiction.
In August 2020, China’s Supreme People’s Court decided that the Chinese courts can impose “anti-suit injunctions”, which forbid a company from taking a case to a court outside the country, in addition to which, judgments from foreign courts have been alleged to have been ignored.
Licensing Fees
As outlined in a statement by the European Commission, the Chinese courts have set licensing fees at around half the market rate previously agreed between western technology providers and manufacturers, meaning that Chinese companies pay less for the technology from overseas providers. In conjunction with the “anti-suit injunctions”, patent holders have been placed under intense pressure to settle for licensing fees below market rates.
Such licensing fees are traditionally reinvested into a company’s R&D, therefore lower licensing fees ultimately leads to decreased levels of innovation, detrimental to the future competitiveness of the EU.
EU & China’s Recent WTO Disputes
The Commission’s filing follows another recent high-profile lawsuit over China’s alleged discriminatory trade practices against Lithuania, which also affected other exports from the EU’s Single Market, as such practices also targeted products with Lithuanian content exported from other EU countries.
The case was filed to the World Trade Organization last month after attempts to resolve the matter bilaterally failed. At the current time of writing, China had agreed to consultation after the European Union filed the request with the World Trade Organization last month, with the consultation period set to last for 60 days.
Moving Forward
China has stated that it regretted the EU’s challenge and that it always upheld the multilateral trading system, with the Commission said it had raised the issue on a number of occasions with China, without resolution. The US and Japan have also expressed concerns and are expected to join the EU’s request for consultations.
The EU’s latest WTO challenge against China has begun its initial 60-day period of consultation between the parties, after which, the EU may request a WTO panel ruling. A notable EU-China Summit is also scheduled for April 1st, with the aforementioned disputes likely to be pertinent discussion topics from both sides, not to mention the potential continuance of the discussion on the EU-China Comprehensive Agreement on Investment (CAI). The CAI, which has been on hold for an extended period of time, may act as a potential olive branch between both sides as hope still exists for its ratification.
The declaration of a certified e-mail address (PEC) is no longer an obligation limited to companies only but extends to their directors as well. This novelty was introduced with the Budget Law No. 207/2024 and became immediately applicable to all companies established or registered with the Business Register starting from January 1, 2025. However, a
Preface As the leader of China’s economic development and the forefront of reform and opening up, Shanghai has always attached great importance to attracting foreign investment. Recently, the Shanghai Government deliberated and adopted a series of policy measures to promote the sustained economic recovery, and at the same time actively responded to the Action Plan
In recent years, the winter sports industry has seen unprecedented global growth, particularly with the successful hosting of the Beijing 2022 Winter Olympics and the upcoming Milan-Cortina 2026 Winter Olympics. These events have not only brought significant attention to winter sports but have also spurred a surge in international investment and collaboration. Legal sectors such
