EU appeals panel report in WTO dispute with China on anti-suit injunctions

The EU has appealed the WTO panel report in its WTO dispute with China on the Enforcement of Intellectual Property Rights (DS611).

In its report, the WTO panel upheld the EU’s case by acknowledging that China has developed a policy of limiting intellectual property rights, starting with the guidelines of the Supreme People’s Court, supported by the political level and implemented by the judiciary through several court judgments. It also found that China must be more transparent by transmitting to the EU and other WTO members information on intellectual property matters, including court judgements. 

However, the panel did not follow the EU’s interpretation of the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement as requiring China to refrain from adopting or maintaining measures that undermine other WTO members’ implementation of the agreement in their jurisdictions. According to the panel, the TRIPS Agreement does not contain an obligation for WTO members to abstain from adopting measures that prevent other WTO members from implementing it in their own territories. 

With this appeal, the European Union intends to reverse the panel’s latter findings, thus seeking to allow European companies to defend their intellectual property in European courts. The outcome of the EU’s appeal is expected in the second half of July 2025.

Background

Case DS 611 involves standard essential patents, which are patents necessary for a product or technology to meet specific industry standards, such as those used in mobile communications.

The measures contested by the EU allow Chinese courts to set global royalty rates for standard essential patents without the patent owner's consent. Essentially, this means China is deciding the cost of patented technology, including technology patented by EU holders. The issue of setting global royalty rates is also part of ongoing consultations in case DS632, which focuses on China's worldwide licensing terms for standard essential patents. 

The appeal is taking place in the framework of the Multi-Party Interim Appeal Arbitration Agreement (MPIA), an alternative arbitration system which allows appeals of panel reports in the absence of a fully-functioning Appellate Body. 

For more information

EU Notice of Appeal

WTO case DS611

Dispute Settlement in the EU

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