WTO reverses parts of decision in EU-China intellectual property dispute

The European Union has obtained a mostly favourable ruling in one of its continuing trade disputes with China over intellectual property, according to a decision published by the World Trade Organization (WTO) on Monday.

Brussels first brought its case against China to the WTO three years ago, charging that Beijing was preventing European tech companies from using foreign courts to defend their patents.

A panel of WTO experts set up in December 2022 to examine the case issued a ruling last April rejecting most of Brussels’ claims and saying it had not shown that China’s actions violated the global trade organisation’s rules on intellectual property.

But an arbitration body created as an alternative the WTO’s moribund appellate system has now largely reversed that ruling.

“The arbitrators disagreed with the Panel’s interpretation,” a Geneva-based trade official, who asked not to be identified, said, explaining the decision.

The arbitrators, the official said, “found that the main measure at issue – which empowered Chinese courts to prohibit patent holders from enforcing their patent rights in jurisdictions outside of China in the context of patent litigation in China – was inconsistent with TRIPS obligations concerning those patent rights”.

TRIPS, or the WTO’s Agreement on Trade-Related Aspects of Intellectual Property Rights, sets minimum standards for IP protection among member states.

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