Beijing Launches Restrictions on Home Purchases, Air Flights over IP Breaches


New regulations launched by the Chinese central government could see citizens punished with downgrades in their social credit standing for breaches of intellectual property rights.

On 4 December the National Development and Reform Commission led the launch of the “Memorandum of Cooperation on Undertaking Joint Punishment of Entities with Severe Credit Loss in the Sphere of Intellectual Property Rights (Patents)” (关于对知识产权(专利)领域严重失信主体开展联合惩戒的合作备忘录).

The Memorandum outlines six forms of credit loss conduct that could incur penalties including restrictions on air travel and train travel, restrictions on home purchases and international asset transfers as well as bans on serving as public officials.

These six forms of credit loss conduct include repeated patent infringement behaviour, irregular patent application behaviour as well as the provision of false documents.

Credit loss information will also be used as reference material for the approval and registration of the public issuance of the bonds of other companies and transactions involving convertible bonds.