On March 2, 2019 the State Council by
its decision No. 709 in paragraph 38 deleted several provisions of
the Regulations of the People's Republic of China on the
Administration of Import and Export of Technology
("TIER") which have been at the center of problems for
foreign IP owners when engaging in technology import to a Chinese
entity. This change opens up technology imports to more free
negotiation without having to consider these mandatory restrictions
which previously protected the Chinese entities in such
agreements.
The changes are;
(a) Deletion of Article 24 (3) TIER -
Liability for the licensed technology
Previously the licensor had to bear
liability for the infringement of third party rights by the Chinese
technology importer when using the licensed technology. This
deletion will remove the requirement to define such liability which
can now be freely regulated by the parties of the technology
transfer agreement.
