Introduction

China’s judicial approach to software copyright protection continues to evolve, reflecting a stronger emphasis on innovation and more sophisticated handling of complex technical disputes. A recent decision by the Supreme People’s Court of China provides important guidance on key issues such as burden of proof, substantial similarity, and joint infringement.

In this case, the Supreme People’s Court overturned the first-instance judgment and fully upheld the plaintiff’s claim for damages of RMB 22.5 million. Beyond the significant damages awarded, the ruling offers valuable insights into the direction of judicial protection for software copyrights in China.

1. Toward More Refined and Substantive Protection of Software Copyright

One of the most notable aspects of the case is the Court’s clarification of the burden of proof. At first instance, the plaintiff’s claim was dismissed on the grounds that it failed to prove certain “negative facts,” such as whether the software had remained unmodified during development.

The Supreme People’s Court took a different view. It held that once the rights holder has provided prima facie evidence—such as a copyright registration certificate, source code archives, and commercial contracts—the burden should not be unreasonably shifted to require proof of “non-modification.” This approach reflects a more balanced allocation of evidentiary burdens and aligns with the legislative intent of encouraging innovation under China’s Copyright Law and Software Protection Regulations.

The Court also adopted a more nuanced approach to determining substantial similarity. Rather than relying solely on direct code comparison, it conducted a comprehensive analysis, taking into account factors such as database structure, deliberately modified elements intended to evade detection, identical software defects, unique identifiers, and even empty functions. This multi-dimensional methodology provides a practical framework for handling technically complex infringement cases where direct copying may be concealed.

2. A Clear Shift Toward Stronger and More Comprehensive Enforcement

The case highlights China’s increasingly robust stance on intellectual property enforcement. In assessing damages, the Court considered multiple factors, including the scale of infringement, industry profit margins, and market data reflected in promotional materials. The full award of RMB 22.5 million underscores a clear judicial intention to deter infringement through meaningful compensation.

Equally significant is the Court’s approach to identifying liable parties. By looking beyond formal corporate structures and contractual arrangements, the Court examined factors such as the involvement of former employees with access to key technologies, operational coordination among affiliated entities, and similarities in copyright registration materials. Based on this analysis, multiple defendants were found to have engaged in joint infringement and were held jointly liable.

This reflects a broader trend in Chinese judicial practice: addressing infringement across the entire chain—from technology misappropriation to commercialization—while preventing bad actors from evading liability through corporate restructuring or contractual fragmentation.

3. Increasingly Sophisticated Methods for Establishing Technical Facts

Determining technical facts remains one of the most challenging aspects of software copyright disputes. In this case, even in the absence of complete source code, the Court relied on alternative methods such as reverse engineering, database structure analysis, and comparison of software defects to establish infringement.

Importantly, the Court also exercised careful scrutiny over expert opinions submitted by the parties. It identified issues such as selective comparison in unilateral forensic reports, thereby reinforcing the judiciary’s active role in evaluating technical evidence rather than deferring entirely to expert conclusions.

This demonstrates the growing maturity of China’s IP adjudication system, particularly in its use of technical investigators, evidentiary rules, and integrated fact-finding approaches in complex cases.

4. Looking Ahead: Judicial Responses in an Innovation-Driven Economy

As the digital economy continues to expand, software has become a critical asset for innovation and industrial development. The judicial principles reflected in this case suggest several future trends:

Improved evidentiary standards: Courts are likely to further refine burden-of-proof rules to avoid placing excessive evidentiary burdens on rights holders, adopting a more structured approach based on prima facie evidence and rebuttal.

Stronger deterrence against sophisticated infringement: There will be increased focus on identifying and penalizing concealed and coordinated infringement activities, potentially supported by broader application of punitive damages.

Enhanced technical adjudication mechanisms: Continued development of professional and diversified tools for fact-finding will improve the efficiency and accuracy of handling complex technology-related disputes.

Conclusion

Through its detailed analysis of evidentiary standards, infringement determination, and damages calculation, the Supreme People’s Court of China has provided clear and practical guidance for future software copyright disputes.

For innovative enterprises, this case not only strengthens confidence in judicial protection but also serves as a reminder of the importance of proper documentation and compliance throughout the software development process. As China continues to strengthen IP protection, businesses that proactively manage their rights and evidence will be better positioned to safeguard their competitive advantages.