Guangzhou Riji Has been Fined USD 28,300 for Illegal Using the Patent of BASF

Because of counterfeiting the patent of BASF and using it in the production of the “Stegner Gold Peptide Skin-lighten roll mask”, Guangzhou Riji was sentenced to forfeit its illegal revenue of USD 11, 800 and another USD 165,000 (1.4 times that income).

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According to the knowledge of CHAILEEDO, Guangzhou Refen (the entrusted manufacturer of Guangzhou Riji) has manufactured three batches of the infringing product, totally counted for 18,305 boxes. Guangzhou Riji has sold out 12,827 boxes of this mask, the sales amount of which was USD 19,900. After the infringing event happened, during the period between April 13, 2021, and June 13, 2021, Guangzhou Riji informed its clients to recall the product involved in this case. The total infringing product to be recalled back is 5,559 boxes, and the refund amount is USD 8,099.

Administration for Market Regulation in Huadu District Guangzhou City has recognized that Guangzhou Riji had violated Detailed Rules for the Implementation of the Patent Law by labeling SALVIA MIL TIORRHIZA on its unpatented or unauthorized product “Stegner Gold Peptide Skin-lighten roll mask”. According to Item One of paragraph 1 of Article 84 in the Detailed Rules for the Implementation of the Patent Law, “the bellowing acts are stipulated in Article 63 of The Patent Law as patent counterfeiting: one, labeling patent logo on the unauthorized products or their packages, continuing to label the patent logo while the patent right is invalid or terminated, labeling unpermitted patent number from others”. According to that, Guangzhou Riji has committed patent counterfeiting in the above acts.

The end result is that Administration for Market Regulation in Huadu District Guangzhou City has charged the Guangzhou Riji to stop producing or selling the counterfeiting product “Stegner Gold Peptide Skin-lighten roll mask”, and remove the patent logo on the unsold product. The illegal revenue of USD 11,800 and another USD 165,000 (1.4 times that income) were expropriated.

CHAILEEDO has searched out that BASF Beauty Care France Company is the owner of the patent number “CN 106794136 A”, which involved combination products of Salvia miltiorrhiza Bunge extract and niacin or niacinamide, and the cosmetic and/or the nutritious composition included these combination products. The effective time of the original patent’s Substantive Review is August 15, 2017.

However, as stipulated by the Patent Law of the People's Republic of China, accounting for the date of application, the expiration time of the patent right for invention is twenty years, and that of the patent right utility model is ten years, the patent right for a design is fifteen years. It is obvious that the patent right of BASF is still unexpired and unauthorized to Guangzhou Riji.

“Patented composition ≠ proprietary technology, they are totally two different things.” An industrial professional has explained with the example that even if glucan had been invented before but another party just found a different way to extract the material, it would be counterfeiting the patent to advertise it this way.

For this kind of phenomenon, the State Administration for Market Regulation has underscored that they will continually target the prominent fields and regions where counterfeiting actions frequently happen. By enforcing the intellectual property law, illegal activities such as trademark infringement and patent counterfeiting will be strictly punished.

In one of the most crowded places for cosmetic companies, the Guangzhou Administration for Market Regulation also has implemented the 13 Measures to Improve the Brand Construction (hereafter short named as Measures) to financially subsidize the protection of patents and trademarks, lowering the companies’ cost of legal rights protection. It has enhanced the scope of patent right protection and the subsidized amount, bringing the highest subsidized amount of patent right protection to 1 million yuan (about USD 148,600), and that of trademark protection to 0.2 million yuan (about USD 29,700).

It is true for the above saying from the industry professional that patent counterfeiting will involve problems of false advertisement. The industry should be alert to it because intellectual property is a brand or a company’s “core” asset. As law enforcement authorities and regulators are increasing their punishment for illegal practices of counterfeiting patents, China’s cosmetic market will be more regulated.