China’s Latest PVR case: "Dan Xia Red" Pear Variety Infringement (full version)
By Alanna Rennie, Baker McKenzie
Background. The Zhengzhou Fruit Research Institute of the Chinese Academy of Agricultural Sciences (Institute) was granted Plant Variety Rights (PVR) for its pear variety “Dan Xia Red” in April 2018. In 2019, the Institute discovered that there were enterprises and individuals grafting and propagating the "Dan Xia Red" without authorisation. In particular, the Ping Ding Grower Professional Cooperative in Henan Province (Cooperative) was discovered to have grafted and propagated more than 40,000 “Dan Xia Red” pear trees. The Institute hired a private investigator to collect evidence. The investigator visited the Cooperative’s orchard and gathered leaf samples for DNA testing. The DNA test (SSR marker method) result showed no differences between the leaf samples from the Cooperative orchard and those of the "Dan Xia Red" variety, supporting the conclusion that the trees growing in the Cooperative’s orchard were similar or the same variety as "Dan Xia Red". Enforcement. In June 2020, the Institute took action against the Cooperative in the Intellectual Property Tribunal of the Zhengzhou Intermediate People’s Court. The matter was ultimately settled through court mediation, with both parties executing a Mediation Agreement on 18 August 2020. Pursuant to the Mediation Agreement, the Cooperative was required to:
prior to 10 September 2020, and under the supervision of the Institute, cut down and destroy the 40,000 infringing "Dan Xia Red" trees; and
prior to 18 September 2020, compensate the Institute 30,000 RMB (ca. 3,800 EUR) and pay 525 RMB (ca. 67 EUR) in contribution to the case management fees.
According to reports, this is the first Intellectual Property enforcement case in relation to pear trees in China and one of the few successful fruit tree PVR enforcement cases. It is therefore a useful case for the enhancement of PVR knowledge and awareness in the fruit tree industry – a good development for fruit trees PVR holders. Brief analysis and main case take-aways. Although the case ended in mediation (which has limited precedential value), it provides some useful insight into how the industry views the farmers’ exemption (otherwise known as the Nongmin Exemption) in China in relation to vegetatively propagated plants.
Although unclear, the result of the Mediation Agreement indicates that the Cooperative would have conceded that the Nongmin Exemption was not applicable to exempt the Cooperative’s PVR infringement. Importantly, the Cooperative was made up of five nongmin.
This conclusion supports the following positions on China’s Nongmin Exemption:
The nongmin exemption does not apply to farmer professional cooperatives (as was opined in the Ministry of Agriculture and Rural Affairs Opinion on the Seed Law released on 4 January 2019), even where such cooperatives are made up of nongmin;
The nongmin exemption does not apply to vegetatively propagated fruit crops – still an untried issue, however cases dealing with PVR infringement in agricultural crops have required a subsistence purpose for the application of the farmers’ exemption – which is clearly not the case for vegetatively propagated fruits and ornamentals; and
If the initially sourced material is unauthorised, the Nongmin Exemption does not apply (which has been applied by authorities in a number of recent PVR administrative decisions).
About the author:
ALANNA RENNIE Associate at Baker McKenzie
Alanna Rennie is an Associate at law firm Baker McKenzie in Sydney, where she practices Mergers and Acquisitions and plant Intellectual Property (IP). She graduated with a Bachelor of Laws with honors from Bond University, Gold Coast, and a Masters in Chinese Law from Tsinghua University, Beijing. Alanna’s Master’s thesis was on Plant Breeder’s Rights in China, where she engaged closely with China’s Ministry of Agriculture and Rural Affairs and the State Forestry and Grasslands Administration, international plant breeders active in or looking to enter the Chinese market, and other stakeholders. Alanna worked with CIOPORA in 2018, where she assisted the association with its activities in China, and continues to assist CIOPORA on various projects in Australia and China in a pro bono capacity. In her capacity at Baker McKenzie and through her work with CIOPORA, Alanna has worked closely with breeding companies on their commercial and IP strategies in China and Australia as well as on novel enforcement issues.