A Fake Right of Priority Under the Cross-Strait Agreement on Intellectual Property Right Protection and Cooperation.

• Author: Chen, Ping-Hsun

1. Introduction II. A Right of Priority under the Paris Convention A. Eligibility 1. Applicants 2. Periods B. China's Problem with the Recognition of a Right of Priority Based on a Taiwan Patent Application III. A Right of Priority under the Cross-Strait IP Agreement A. Cross-Strait IP Agreement as a TRIPS-Minus Treaty B. Formality Issues in the Context of the ECFA C. Problematic "Right of Priority" Provision IV. China's Implementation of the "Right of Priority" Provision A. Patent B. Trademark C. Plant Variety D. Role of the Taiwan Intellectual Property Office V. Conclusion I. Introduction

   On June 26, 2010, Taiwan and China entered into the Cross-Straits Economic Cooperation Framework Agreement ([phrase omitted], liang-an jing-ji he-zuo jia-gou xie-yi) (ECFA), which was overwhelmingly claimed to be a major step in the Taiwan-China relationship. (1) Because of the "One-China" policy, even before Taiwan joined the World Trade Organization (WTO), China tried to boycott the WTO membership application of Taiwan. (2) When Taiwan started to negotiate for its entry into the General Agreement on Tariffs and Trade (GATT) (a predecessor of the WTO), the Chairman of the GATT Council clarified that because of the "One-China" policy, Taiwan could not join the GATT until China finished its accession. (3) When China proposed its accession, it tried to persuade other WTO members to characterize Taiwan as a "Separate Customs Territory of China," but that failed because of the opposition from the United States. (4) After Taiwan joined the WTO, China constantly refused to negotiate with Taiwan about trade matters under the WTO framework because it was afraid of an impression that Taiwan is a sovereign country and is not part of China. (5) China made its best efforts to keep its trade talk with Taiwan as an internal Chinese matter. (6) Finally, in 2008, China got a chance to implement its agenda because the pro-China party KMT won the presidential election in Taiwan. (7) China began its trade negotiations with the KMT-led government while both parties treated the negotiations as an internal matter. (8) As a result, the ECFA was signed.

   The ECFA is unique in terms of intellectual property protection. Contrary to other free trade agreements (FTAs) signed by both nations, no intellectual property clause was included in the ECFA. (9) Instead, the two countries signed a separate Cross-strait Agreement on Intellectual Property Rights Cooperation and Protection ([phrase omitted], hai-xia liang-an zhi-hui cai-chan-quan bao-hu he-zuo xie-yi) (Cross-Strait IP Agreement). (10) This significant feature indicates that both nations agree with some form of "One China," which unfortunately has restrained Taiwan from developing a formal, diplomatic relationship with other nations for decades. (11)

   The Cross-Strait IP Agreement was renowned for China's admission of a right of priority of Taiwanese applications for patents, trademarks, and plant varieties. (12) In fact, under the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement), China should have been obligated to admit a right of priority of Taiwanese applications. (13) But, China had never fulfilled such obligation. China's special concern was that a right of priority is rooted from the Paris Convention for the Protection of Industrial Property (Paris Convention), which only allows a state to join; thus, by admitting a right of priority of Taiwanese applications, China may admit the statehood of Taiwan directly or indirectly. (14) As a result, this special concern was codified in the Cross-Strait IP Agreement.

   The Paris Convention was signed in 1883 after a long period of negotiations. (15) A union was formed to harmonize the legal protection on patents, trademarks, and industrial designs. (16) The Paris Convention established two fundamental principles: national treatment and a right of priority. (17) While the national treatment doctrine requires a member country to treat its own citizens and foreign nationals of other member country equally, (18) the right of priority helps an applicant establish a universal filing date of the same subject matter in her own country as well as in other member country. (19) Both principles were intended mainly to increase foreign patenting by eliminating obstacles against foreign patent applicants. (20)

   Articles 2 and 3 of the Paris Convention govern the principle of national treatment. (21) In terms of protection of industrial property under domestic laws, Article 2 requires a member state to treat nationals of any other member state as its own nationals. (22) Article 3 extends the national treatment to nationals of countries outside the Union as long as they "are domiciled or [they] have real and effective industrial or commercial establishments in the territory of [a member state]." (23)

   The right of priority is vested in Article 4 of the Paris Convention. (24) Under Article 4, the right of priority is a right granted to a foreign applicant for a patent, trademark, or industrial design. (25) Such priority right mandates a member state to treat the filing date of the prior application filed in any foreign country as the filing date of the domestic application for the same subject, if such foreign country is also a member state. (26)

   China has been a member state of the Paris Convention since 1985, (27) but Taiwan is not. Since both countries joined the WTO, several provisions of the Paris Convention have become binding to both countries under the TRIPS Agreement. (28) Article 2(1) of the TRIPS Agreement provides that "[i]n respect of Parts II, III and IV of this Agreement, Members shall comply with Articles 1 through 12, and Article 19, of the Paris Convention (1967)." (29) Therefore, China should comply with Articles 2, 3, and 4 of the Paris Convention and grant the rights under those articles to Taiwanese applicants for industrial property. In other words, China should have granted a right of priority to an application.

   While the Cross-Strait IP Agreement grants some form of a right of priority, this article is intended to explain that China has not granted to Taiwan applicants a real right of priority under the Paris Convention. In this article, Part II introduces a right of priority under the Paris Convention. Particularly, Part II describes the fundamental features of a right of priority. Then, Part III analyzes the "right of priority" provision of the Cross-Strait IP Agreement. Part III also addresses several distinctive features of the Cross-Strait IP Agreement and its formation, which may reflect China's unspoken concern. Part IV discusses China's implementation of the Cross-Strait IP Agreement and argues that China offers to Taiwan a fake right of priority.

2. A Right of Priority under the Paris Convention

   1. Eligibility

      1. Applicants

         A right of priority is vested in Article 4 of the Paris Convention, which includes several sub-provisions. Article 4(A)(1) provides that

         [a]ny person who has duly filed an application for a patent, or for the registration of a utility model, or of an industrial design, or of a trademark, in one of the countries of the Union, or his successor in title, shall enjoy, for the purpose of filing in the other countries, a right of priority during the periods hereinafter fixed. (30) The subject matters cover patents, utility models, industrial designs, and trademarks. Trademarks, in this instance, does not include service marks. (31)

         "Any person" in Article 4(A)(1) includes a national defined in Article 2. (32) "Nationals" include "natural persons" and "legal persons." (33) "Natural persons" are persons of nationality of a member state. (34) The law of the member state whose nationality is claimed governs the determination of nationality. (35) On the other hand, "legal persons" are categorized into public status and private status. (36) "Public status" covers "the States themselves, or State enterprises, or other bodies of public status," (37) whose nationality is their country. (38) "Private status" covers "corporate bodies of private status, such as companies and associations," (39) whose nationality is defined by the law of the state under which they are established. (40)

         "Any person" in Article 4(A)(1) also includes a national as defined in Article 3. (41) For "natural persons," the "domicile" requirement under Article 3 refers to the "residency" status in any member state other than the member state where a right of priority is claimed. (42) For "legal persons," the "domicile" status depends on "the place of their actual headquarters." (43) To claim a right of priority in one member state, the actual headquarter of a legal person under Article 3 must be located in any other member state. (44)

         In addition, the competence of such Article 4(A)(1) person has to be met at the filing date of the foreign application the right of priority is based on and at the date of claiming the right of priority. (45)

         Last, the applicant of the first application may claim a right of priority. (46) Such applicant may transfer the right of priority to another person (or successor in title) independently in the other member states. (47) The right of priority may even be transferred to different persons in different countries. (48) However, after the right of priority is claimed by one application, it becomes "an accessory of such application" and, therefore, cannot be transferred again elsewhere. (49)

      2. Periods

         "Periods" in Article 4(A)(1) includes time frames for four types of industrial property: patents, utility models, industrial designs, and trademarks. (50) The periods for patents and utility models are twelve months, while the periods for industrial designs and trademarks are six months. (51) The starting date of a period is the filing date of the first application for an invention, but the starting date is counted in the calculation of the period. (52) Besides, a period shall be extended if...