On Saturday, the National People’s Congress of China enacted a measure establishing a new intellectual property court in the southern island of Hainan. China has sought to strengthen Hainan’s position as a global free trade port in the South China Sea, competing with other shipping centers in the area such as Hong Kong, Singapore, and Kaohsiung.

This is the fourth dedicated IP court established in mainland China, following those in Beijing, Shanghai, and Guangzhou. China’s IP courts have specialized jurisdiction over civil and administrative cases involving patents, trade secrets, software, hardware, agricultural technology; civil, administrative, and criminal jurisdiction over intellectual property cases; and appellate jurisdiction over cases previously tried in Hainan courts. These courts have significantly broader jurisdiction than regional IP tribunals, such as those in Tianjin and Shenzhen, which do not share the “three-in-one” jurisdiction of the larger IP courts.

While explaining the jurisdiction the order stated:

2. The Intellectual Property Court of Hainan Free Trade Port has jurisdiction over the following cases:

(1) Hainan Province’s first-instance intellectual property civil and administrative cases involving patents, technical secrets, computer software, new plant varieties, integrated circuit layout designs, identification of well-known trademarks and monopoly disputes, etc.;

(2) First-instance civil, administrative, and criminal cases of intellectual property rights under the jurisdiction of the Intermediate People’s Court of Hainan Province other than the provisions of the preceding paragraph;

(3) Cases of appeals and protests of civil, administrative and criminal judgments and rulings on intellectual property by the Hainan Provincial Basic People’s Court;

(4) Other cases determined by the Supreme People’s Court to be under its jurisdiction.” The first-instance criminal case of intellectual property that should be heard by the Intellectual Property Court of Hainan Free Trade Port shall be prosecuted by the First Branch of the Hainan Provincial People’s Procuratorate. Hainan Provincial People’s Procuratorate First Branch of Hainan Provincial People’s Procuratorate shall perform corresponding procuratorial duties in cases of appeals and protests of criminal judgments and rulings on intellectual property rights of the first instance of Hainan Provincial Basic People’s Court.

Hainan’s economy is primarily agricultural and tourism-based currently. Therefore, there are unlikely to be major disputes for the new court to adjudicate when the National People’s Congress’s measure enters into effect on January 1, 2021. However, goods imported to China via Hainan will be subject to a zero-tariff policy, provided the goods comply with a thirty percent value-added requirement, which is intended to draw high-tech industries to the island.

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