China's Regulations on the Protection of Layout-Designs of Integrated Circuits (the "Regulations"), promulgated in 2001, are specialized legislation for strengthening intellectual property protection for integrated circuits. By granting creators of layout-designs exclusive rights and prohibiting competitors from copying and commercially exploiting others' registered layout-designs without authorization, the Regulations protect the intellectual labor and financial investment of creators. As demand for intellectual property protection for integrated circuits has increased markedly, China's timely revision of the Regulations to systematically improve the protection system for layout-designs of integrated circuits is of great practical significance.

I. Introduction of a cancellation-upon-request procedure

The exclusive right in a layout-design arises upon registration with the China National Intellectual Property Administration (CNIPA); without registration, a layout-design is not protected under the Regulations. The pre-revision Regulations provided a procedure for cancelling a registration found not to comply with the Regulations after it had been granted, but that procedure could only be initiated by CNIPA ex officio; in practice, third parties could only submit suggestions for cancellation. The revised Regulations introduce a procedure for initiating cancellation upon the request of a third party: "Any person who finds that the registration does not comply with these Regulations may request the intellectual property administrative department of the State Council to cancel the registration of the layout-design. The intellectual property administrative department of the State Council shall examine the request for cancellation of the layout-design registration and make a decision in a timely manner, and notify the requester and the holder of the layout-design right."

The cancellation procedure under the revised Regulations closely resembles the patent invalidation procedure. In patent infringement litigation, the defendant cannot directly assert an invalidity defense, but must have the patent declared invalid through a separate procedure. Likewise, in layout-design infringement litigation, the defendant should not directly raise a defense that the layout-design registration should be cancelled; that is, the court should presume the registration valid and then decide whether infringement exists. If the defendant asserts that the registration should be cancelled, it should pursue cancellation through a separate administrative procedure.

II. Addition of reward and remuneration measures for the creation of layout-designs

The pre-revision Regulations did not address whether or how legal persons or unincorporated organizations should reward and remunerate relevant personnel after the successful commercialization of a layout-design. To incentivize the creation and application of layout-designs, this revision adds a provision that legal persons or unincorporated organizations shall, in accordance with the Law on Promoting the Transformation of Scientific and Technological Achievements and relevant state provisions, give reasonable rewards and remuneration to personnel who meet the relevant conditions.

The revised Regulations directly apply the Law on Promoting the Transformation of Scientific and Technological Achievements and relevant state provisions, adopting the principle of freedom of contract first: entities and designers may agree on the manner, amount and timing of rewards and remuneration. Absent such agreement, in accordance with that Law, rewards and remuneration shall be drawn at no less than 50% of the net income from the transfer or licensing of the scientific and technological achievement, or 50% of the shares or capital contribution ratio formed by investment valued on the basis of the achievement; where the entity implements the achievement itself or in cooperation with others, for 3 to 5 consecutive years after successful commercialization, no less than 5% of the annual operating profit shall be drawn for rewards and remuneration.

III. Improvement of damages rules for infringement

The revised Regulations improve the rules on damages for infringement and introduce a punitive damages system. As to calculation methods, the revised Regulations, drawing on the Patent Law, make clear that damages shall be determined according to the right holder's actual losses, the infringer's gains from the infringement, or a multiple of the licensing fee. Notably, the wording "reasonably determined by reference to a multiple of the licensing fee" is consistent with the Patent Law; where the infringer acted without intent, this calculation method remains compensatory in nature and has no punitive purpose.

The revised Regulations introduce punitive damages: "for willful infringement of the exclusive right in a layout-design, where the circumstances are serious, the amount of damages may be determined at not less than one time and not more than five times the amount determined according to the above methods," reflecting the aim of raising the level of protection for layout-designs. Registered layout-designs usually contain many original details. The revised Regulations make a series of changes to strengthen the requirements for registration application documents and to define the scope of protection of the exclusive right, making the original parts of a layout-design easier to verify than under the pre-revision Regulations. Where the right holder proves that the infringer acted willfully and the circumstances are serious, the punitive damages provided by the revised Regulations can pose a real deterrent to infringers. In this regard, the introduction of punitive damages is undoubtedly good news for right holders.

IV. Improvement of confidentiality requirements

In practice, most applicants choose to submit electronic copies or drawings through electronic filing. Given that the revised Regulations require copies or drawings to clearly show the original parts of the layout-design, applicants or right holders inevitably worry about the disclosure of layout-design information.

The revised Regulations correspondingly improve confidentiality requirements and legal liability, making clear that, except as needed by state organs performing their duties in accordance with law, no one may consult or copy the electronic versions of the copies or drawings of a layout-design; they also provide that staff of the intellectual property administrative department of the State Council and other relevant personnel, as well as agencies, shall bear corresponding legal liability for disclosing undisclosed contents of layout-designs.

In sum, the profound changes in the innovation model of integrated circuits make the revision and improvement of the layout-design protection system both practically significant and urgent. This revision responds to practical needs, systematically improves China's rules for protecting layout-designs of integrated circuits, and provides design enterprises with clearer guidance for addressing new technological challenges. There is good reason to believe that the revised Regulations will produce stronger incentives for innovation.

Source: China National Intellectual Property Administration (CNIPA), Policy Interpretation column. Date of original: August 3, 2026. Original link: https://www.cnipa.gov.cn/art/2026/8/3/art_66_207422.html