China’s new administrative regulations on human genetic resources as applied to foreign persons

The Administrative Regulations of the People’s Republic of China on Human Genetic Resources (the “Regulations”), promulgated by China’s State Council, went into effect on July 1, 2019, superseding prior regulations on China’s human genetic resources (“China HGR”), particularly the 1998 Interim Methods of Human Genetic Resources Administration.

This article is not a comprehensive review of the Regulations, but rather focuses on those provisions in the Regulations that govern conducts related to “foreign organizations and individuals, as well as their established or actually controlled institutions” (collectively, the “Foreign Persons”). For a detailed analysis or an English translation of the Regulations, please contact the author.

The Regulations prohibit Foreign Persons from collecting or preserving China HGR in China, or providing China HGR abroad. The Regulations do permit Foreign Persons’ limited use of China HGR “to carry out scientific research activities,” which must be conducted through collaboration with Chinese scientific research institutions, higher education institutions, medical institutions, or enterprises (collectively, the “Chinese Entities”). Such activities must be approved by China’s Ministry of Science and Technology (“MOST”), and the application for approval must be filed jointly by the Foreign Person and the relevant Chinese Entity. The only exception to the approval requirement is “international collaboration in clinical trials” that do not involve the outbound transfer of China HGR materials such as organs, tissues, or cells comprising the human genome, genes, or other genetic substances (collectively, “China HGR Materials”). Such clinical trial collaboration, however, must still be pre-registered with MOST.

The Regulations require that the permitted international collaboration ensure that “the Chinese Entities can take part in the research substantially in the whole process for the duration of the collaboration” and have full access to and complete copies of “all records, data and other information in the research process.”

The outbound transfer of China HGR Materials in permitted international collaborations must be on an as-needed basis and subject to MOST’s prior approval, which is required for the customs procedures.

The Regulations dictate that any patent rights based on scientific research results obtained in the permitted international collaboration must be jointly owned by the participating Foreign Person and Chinese Entity. Ownership and use rights of other scientific and technological achievements arising from the collaboration may be contractually agreed upon by the parties. Notably, the Regulations do not dictate the ownership of HGR information, i.e., the data and other information materials generated from the utilization of China HGR Materials (collectively, “China HGR Information”), arising from the international collaboration, but simply provide, without further clarification, that it can be used by both collaborating parties.

Penalties for violation of the Regulations by Foreign Persons include injunction; confiscation of any China HGR illegally collected or preserved and of any relevant illegal income; and  a fine of more than RMB 1 million but less than RMB 10 million. If the illegal income is more than RMB 1 million, the fine will be five to ten times that of the illegal income.

The Regulations do permit the provision of or open access to China HGR Information to Foreign Persons, subject only to registration with MOST. In the event such provision or access could endanger China’s public health, national security or public interests, MOST’s security examination will be required. This may provide an easier route for Foreign Persons to gain access to China HGR Information (but not China HGR Materials), because apparently no international collaboration is required for such access.

China’s next steps in regulating China HGR will likely focus on legislation related to the clinical application of new technologies in biomedicine, in part as a response to the gene-edited babies scandal that broke out in late 2018.