CHINA – BEIJING Trends and Developments Contributed by: Ye Zhao and Liwei Jiang, Jingtian & Gongcheng
• Single-document comparison rule: In 2023 SPC ZhiMinZhong No 1228 , the SPC held that secrecy challenges “must ordinarily employ the single- document comparison principle” – only one prior article reference may be cited against any given secrecy element. The defendant’s reliance on at least three combined references “paradoxically confirmed” that the secret was not readily obtain - able by a person skilled in the field. • Correction of expert fragmentation: In 2023 SPC ZhiMinZhong No 642 , the first-instance expert opinion isolated the “n-heptane extraction” step and characterised it as general knowledge. The SPC overruled: the plaintiff’s trade secret was an “insepa - rable, integrated process” combining the one-pot esterification rearrangement, n-heptane extraction, and crystallisation steps; artificially severing them produced an error and would not be adopted. The holistic comparison principle represents a doctrinal alignment of Chinese trade secret law with the nature of industrial know-how. Proprietary processes derive their competitive value not from any single step but from the specific combination, sequence, and parameterisation of multiple elements – many of which may be individu - ally disclosed in the prior article.The SPC’s insistence on assessing the combination as a unit reflects a com - mercially realistic understanding of how technology advantage is actually created and protected. Trend 8: Piercing the corporate veil – expanded liability for all enabling Parties The SPC applied a clear “substance over form” approach to liability, refusing to allow beneficial own - ers, financial backers, or enabling service providers to shelter behind corporate separateness. • Shadow controllers held jointly liable: In 2023 SPC ZhiMinZhong No 642 , the individual who orches - trated the misappropriation whilst simultaneously holding roles as shareholder, export agent, and contract manufacturer was held jointly and sever - ally liable for the full CNY80 million award along - side the two infringing companies. In No 445, the external investor who recruited and compensated the defecting employees was held to have used the infringing company as his tool and was jointly liable for CNY28.87 million.
• Purchasers, investors, construction contractors, and project owners all jointly liable: In 2023 SPC ZhiMinZhong No 868 , the buyer of stolen drawings continued using them even after the seller’s crimi - nal conviction and was held to have acted with deliberate intent, resulting in a five times punitive multiplier. In • 2023 SPC ZhiMinZhong No 1228 , the construction contractor who built the infringing facility – hav - ing previously been shown confidential layouts – was held to have turned a blind eye and was found grossly negligent, attracting joint liability up to CNY20 million. In 2023 SPC ZhiMinZhong No 2880 , two further companies that engaged the infringing process without due diligence on its provenance, and that profited handsomely from the resulting contract, were made jointly liable for amounts of CNY22.29 million and CNY13.38 mil - lion, respectively. • The principle established is broad Any party in the infringing chain that provided capital, monetisation channels, or physical infrastructure, and that knew or should have known of the misappropriation, bears joint and several liability commensurate with its contribution and benefit. Trend 9: Civil and criminal proceedings are substantively independent Rights holders historically relied heavily on criminal investigation as a prerequisite for civil enforcement – both for evidence and for jurisdictional confidence. The SPC’s 2025 decisions fundamentally severed that link, affirming the full independence of civil trade secret proceedings from criminal outcomes. • No criminal case? No obstacle: In 2023 SPC ZhiMinZhong No 1228 , the local police declined to open a criminal investigation, issuing a formal non- prosecution notice. The SPC nonetheless applied civil evidentiary standards, found infringement, and awarded the full claimed amount of CNY60 million. In 2023 SPC ZhiMinZhong No 642 , the Hangzhou Public Security Bureau declined to investigate for “insufficient evidence”. The civil court indepen - dently established the facts, applied a three times punitive multiplier, and ordered joint liability total - ling CNY80 million.
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