(Internet Photo)

A US company and a Shanghai firm have agreed to settle an intellectual property rights (IPR) dispute after customs authorities seized chip-making equipment from the US company at the Shanghai Pudong International Airport.

At the start of 2018, Chinese company Advanced Micro-Fabrication Equipment Inc (AMEC) learned that US equipment suspected of infringing the company's patents would arrive at Shanghai Pudong International Airport. Shanghai customs authorities then seized the suspected products, Jiefang Daily reported on Friday, citing customs officers.

Customs suspended the clearance of the products worth 34 million yuan ($5.36 million).

With the customs' involvement, the US company, whose name was not revealed, attached importance to AMEC's patents and negotiated with AMEC. The two sides agreed to settle the dispute by offering cross licenses to each other.

Based in Shanghai, AMEC is a global micro-fabrication equipment manufacturer, serving customers in the semiconductor industry and adjacent high-tech sectors. The company has applied for over 1,200 patents.

With the advances in Chinese technologies, the number of such infringements will rise, according to Hao Junbo, a lawyer at Beijing-based Hao Law Firm.

He told the Global Times on Friday that Chinese companies can learn from the US by prohibiting imports or padlocking imported products.

In 2017, China made 1.38 million invention patent applications, leading the world for the seventh year. It made 51,000 Patent Cooperation Treaty patent applications, ranking second in the world.

In accordance with international trade rules, China always pays fees for using IPRs, said Shen Changyu, head of the State Intellectual Property Office, at a press conference on Tuesday. In 2017, China paid $28.6 billion to other countries, with a deficit surpassing $20 billion.

China will better protect IPR to improve the business environment and attract more foreign investors, Shen said, noting that China treats IPR of domestic and foreign companies equally.