Eight Years in China (Without Your Logo Getting Used)

Remember the blog on July 21 about a Marketplace Public Radio programme about a Chinese trademark squatter that wanted a ransom from the US Public Broadcasting Service? Read here.

Well, in this radio programme (that is in audio and in written form) Jocelyn Ford interviewed Joseph Simone, lawyer of Baker & McKenzie in Hong Kong.

Ford wrote about Simone : But he says few companies pay ransom. Most lodge a complaint and that can stop the logo from being used in China for as long as eight years.

I wondered how this could be possible. So I consulted the amended Trademark Law of 2001, the Implementing Regulations of 2002 and in some judicial interpretation, to no avail. Has it anything to do with Well-known trademarks or case law? When the Paris Convention remained silent on the subject, I decided to ask Joseph Simone.

By email Mr. Simone responded to my question:

If someone pirates your mark, you can file an opposition after it is gazetted in the TMO’s Trademark Gazette (Shangbiao Gonggao). The opposition would be handled by the TMO, which will normally take 3-4 years to issue a decision. The TMO’s decision is subject to appeal to the Trademark Review and Adjudication Board (TRAB), which is now taking a further 5-7 years to issue decisions in most cases. This is how I got to the eight year figure.

Still further appeals to the courts are possible, which might take 1-2 years.

The Trademark Office (TMO) and the Trademark Review And Adjudication Board (TRAB) are both of the State Administration of Industry and Commerce (SAIC) and under the supervision of the State Council. The first is responsible for the registration and administration of trademarks, while the latter is responsible for handling matters of trademark disputes (article 2 Trademark Law).

Pursuant to article 57 Implementing regulations trademark law 2002, the TMO shall compile and publish and distribute the Trademark Gazette, to publish trademark registrations and other related matters. Articles 22 and 23 Implementing regulations trademark law 2002, deal with opposition against the TMO via an application for trademark opposition and appeal to TRAB via Application for Review of the Opposed Trademark, respectively.

Simone published an interesting article in January 2005 about Counterfeiting in China. Although it is a review of 2004, it is still relevant. See here (pdf). In March 2005 Simone published together with Shihyann Loo a power point presentation about recent developments in anti-counterfeiting in China. See here (pdf).

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Local Authorities Role

Role Local Authorities Underexposed In Wilson’s Article

Doug Wilson is trying to wake up America, in an article for Townhall.com.

First he writes about Foxconn, which is supposed to be China’s largest manufacturing plant, with 190.000 female workers. Then he writes about the work ethos they have. Wilson goes on quoting “a seasoned business professor from the Massachusetts Institute of Technology”, who remained unnamed, about China.

“They play for keeps.” He said, “If you as an American build a plant in China, they don’t give you protection of intellectual property. They gradually start taking workers from your plant and build another plant just like it. They sell to your customers and undercut your price. They then buy your plant back from you for a dollar.” Obviously this is an entirely different way of thinking about business than what we are used to as Americans.

With the best intentions one cannot call this article nuanced. First of all the article relies to much on hearsay. All these statements lack arguments. For example: According to Wilson’s anonymous professor “they” gradually start taking workers from your plant and build another plant just like it. As a foreign company you can retain workers giving them good working conditions and thus creating loyalty. Besides, you can prevent that some critical processes in the plant be copied. Wilson’s “entirely different way of thinking about business” is just called competition. The article gives a distorted view of what the problem really is. It pretends businessmen think differently in China, but they are just competitive. What is underexposed, however, is that local authorities don’t adequately protect and enforce intellectual property. Wake up Wilson. If you use a anonymous source, you should at least give some arguments pro or contra the things he or she is claiming. And give some context.

Wilson writes: while the US is getting more laws and regulations, China has minimum regulations (This is not true: China has a pretty complete framework of laws, regulations and judicial interpretations on the books. However, the challenge is that these will be enforced). Preluding to Wilson’s four key initiatives he will write next time. What a cliffhanger. Hope they are better argued.

Read Wilson’s article here.

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Chinese Counterfeit Downunder

Australia’s Challenges With Chinese Counterfeit Imports

Dan Harrison (not to be confused with Dan Harris of China Law Blog) wrote for The Age an article about counterfeit imports that plague Australia. Australian Customs is doing a fine job. But according to Stephen Stern, the intellectual property practice group leader at Corrs Chambers Westgarth Australia’s intellectal property law clould be improved.

  • Customs should be given the power to fine offenders. It is usually left to trademark owners to start ligitagion;
  • Stern advocates tougher penalties. The Australian Trade Marks Act 1995 provides for terms of imprisonment of up to two years, and fines of up to Australian $ 55,000 (articles 145, 146, 147, 148 in conjunction with article 149 Trade Marks Act 1995 of Australia. In comparison: Chinese criminal law provides imprisonment sentences of up to seven years, and fines of up to RMB 500,000 (US$ 62,000);

Mr Stern pointed to the United States, where sellers of counterfeit goods could be fined the cost of the genuine items.

Read Harrison’s article here.

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TGIF

Zinedine Zidane Head-Butted By Trademark?

Zhao Xiaokai, general manager of a sport-related company, paid 2,000 yuan ($250) to register the trademark — a silhouette of Zidane head-butting Italy defender Marco Materazzi’s chest — for shoes, hats and beer products, the Beijing Daily said.

Now Zhao is inviting bids of one million yuan for the rights to use the image of Zidane’s head-butt. Some beer companies have expressed interest.

“This recognition level of this trademark is very high. Using a silhouette to render this image avoids violating the soccer star’s image rights,” Zhao said.

IPKat points here to possible infringements of:

  • rights of personality;
  • privacy;
  • unfair competition;
  • passing off.

Read Reuters’ article here.

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Digital Media Exchange

Is Harvard’s Digital Media Exchange The Solution To Online Piracy In China?

Kristin Eliasberg wrote the interesting article ‘Digital pathways to Asia’ for the Havard Law bulletin. He’s focusing on the research of the Harvard Law School’s Berkman Center for Internet & Society on the Chinese infringements of copyright and censorship.

Professor William Alford’s book ‘To Steal A Book Is An Elegant Offense’ published in 1995 was discussed and a possible solution to online piracy in China called Digital Media Exchange (DMX).

DMX is part of the Berkman Center’s Digital Media Project and Digital Media in Asia is part of the Digital Media Project.

It’s a file-sharing cooperative which, for a nominal fee, would give consumers “all-you-can-eat” access to digital entertainment files while providing for compensation of content-creators on a per-usage basis. The DMX, originally proposed by Professor Terry Fisher ’82 in his book “Promises to Keep,” evolved into a possible Chinese pilot program when then graduate student Eric Priest LL.M. ’05 pointed out its promise for a culture like China’s. Priest, who had worked in the Chinese music industry and is now a fellow at the Berkman Center, helped organize meetings on DMX with Fisher, Berkman Fellow and York University Adjunct Professor Paul Hoffert, various representatives from the Chinese entertainment and IT industries, and government officials in Beijing.

Priest has high hopes for DMX. He gives the following reasons:

  • The severity of the problem;
  • Growing sensitivity to IP issues for Chinese companies and the government (because of growing pressure on Chinese companies and China’s central and local governements: IP Dragon);
  • Internet service providers and universities are beginning to worry about being held liable for the widespread copyright infringement on their networks;
  • Major record companies that are reluctant to provide content to a DMX system in the U.S. may be less reluctant to do so in China, because they simply don’t have a viable alternative business model in China.

Read Kristin Eliasberg’s article here.

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China Bans Uploading And Downloading Of Pirated Content

In many countries only the uploading of unauthorised copyrighted content is banned. As of July 1, 2006, the Protection of the Right of Communication through the Network is effective which bans both up- and downloading of pirated content.

The People’s Daily Online quotes Yan Xiaohong, deputy chief of the National Copyright Administration (Chinese), saying China was working on the ratification of two international treaties on the Internet with WIPO. Read more about WIPO’s Copyright Treaty and Performances and Phonograms Treaty here.

The People’s Daily Online article can be found here.

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China In A Hurry To Get Chinese Technology Standards

In March Oong Boon Kiat wrote that China is pushing for its own RFID standard in order to get its own intellectual property rights, see here. The Chinese RFID standard was expected to be ready in 2008. Now Mike Clendenin wrote for Electronic Engineering Times that China’s standard might be implemented in 2007. China seems in a hurry.

Read Clendenin’s article here.

Mure Dickie wrote for the Financial Times an article called ‘US official takes aim at US standards’ see here (paid registration). One criticaster of China’s standards is Franklin Lavin, undersecretary for international trade at the US Department of Commerce.

I have not read the full FT article but maybe he said something such as: Let the market decide which technology standard should prevail. It’s not healthy for innovation when a governement is supporting it’s own proprietary standard.
Many proprietary standards could hamper innovation, because other technology wants to be build on it. It is unpractible for this dependent technolgy to be compatible to all different standards. Look at the PC industry. When Microsoft established a standard for operating systems (near monopoly), the innovation for software applications took off. Then again, the innovation of operation systems was not very much stimulated for a long time.

If you have read it, correct me if I am wrong.

Read more about quoting Lavin on intellectual property protection in China here.

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How To Avoid Buying Counterfeit Electronic Components

Christos Papakyriacou, managing director of independent electronic distributor Alpha Micro Components, has some advice on how to avoid purchasing counterfeit electronic componnents.

His first advice:

Try to avoid buying from China, unless it is from a trusted source, it’s our experience that this is where a lot of the counterfeit components originate from. In many cases payment is requested in advance. It is extremely difficult to get your money back if you have paid up front and unfortunately you will be stuck with the worthless counterfeit goods.

However, this sounds a bit too simple for my taste. Many counterfeit products were manufactured in China but are sold in other countries. And it’s hard to find out were they products originate from.

Read Papakyriacou’s article for Engineer Live here.

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2005: 78 Percent Rise of IPR Litigation Involving Foreign Companies

Wang Zhenghua wrote for the China Daily about a seminar organised by WIPO, SIPO and the Hunan provincial governement.

In 2005, there were 268 civil IPR disputes related to foreign companies, mainly in such sectors as automobiles, motorcycles, pharmacy, computer software, books and audio-visual products. This was a jump of 78 per cent over 2004.

Read Wang’s article here.

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CCTV Needs IPR As Protection Not Condom

Zhong Yang Yi Tao (CCTV Channel One), means also “central number one sheath”. Li Zhenyong, wanted to make use of this sexual connotation and applied last January to register the name as trademark for condoms.

Interfax China wrote: An official from CCTV expressed surprise at the application, but whether CCTV will take legal action to oppose the trademark registration is yet to be seen, the newspaper said.

Read more here.

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IPR Enforcement in China: Keep On Rollin’

Heeling Sport’s strenuous efforts to enforce its patent and trademark of Heelys (shoes with embedded wheels) in China was covered by Katherine Yung of the Dallas Morning Post and published by York Weekly.

Michael Staffaroni CEO of Heeling was disappointed that the administrative authorities did not forward the case to the police for prosecution.

According to the U.S. Chamber of Commerce, fewer than 1 percent of the total copyright and trademark cases handled by Chinese administrative enforcement authorities last year were turned over to the police for prosecution.

Read Yung’s article here.

In the story Lian Hoon Lim, a consultant at Kearney in Hong Kong was interviewed. Lim recommends, in another story by Elaine Kurtenbach for Seattle PI about companies fighting counterfeiting with price and pack, to use a portfolio approach:

A combination of secrecy, careful research of local partners, new technology and business strategies, as well as legally enforcing patents and trademark rights.

Read Kurtenbach’s article here.

Lim is the co-author of a AT Kearney report called ‘Staying Ahead of China’s Counterfeiters’, about strategies to prevent and enforce IPR infringements, read here.

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Japan’s Plan: 16 States Cooperating To Protect IPR

Jiji press reported about Japan’s plan to start economic partnership agreements between 16 Asian and Pacific nations to build an economic bloc with a population over 3 billion people and to improve intellectual property protection.

Member states should be:
Japan, India, China, South Korea, Australia, New Zealand, the ASEAN countries (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam).

Planned start of negotiations is 2009.

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Innovationsschutzprogramm

Austria’s Innovative ‘Innovationsschutzprogramm’ For Patents Will Become Reality

Hannes Farnleitner, former federal Minister of Economic Affairs ofAustria said something remarkable in 2005:

We have an international patent documentation office in Vienna. And it is absolutely normal that a very vivid Chinese thinker says if they have no patents inChina let’s copy it. [..] we get daily at least 120 requests from Chinese persons to get some information about who patented what and what not in China. So it’s absolutely amazing that today my advice is, a leading consultant in my country, to small and medium sized companies not to patent anything. And not to deliver your product where there is a small market for you in China and India because the chance to be copied is [silence].

Farnleitner wanted to use the Austrian chairmanship of January to June 2006 to put his idea of an Innovation Protecting Agency on the EU agenda and start a Transatlantic dialogue. Two weeks ago I called the Austria Wirtsschatsservice (AWS), the Austrian Commerce Service in Vienna, and Dr. Georg Buchtela said they are implementing Farnleitner’s idea, which is besides making SME’s aware of intellectual property rights, to patent their inventions, designs, utility models in such a way that the government will take the risk for any infringments. The SME’s have to give the right to file complaints against infringements to the government. According to Farnleitner, that way you build up a very strong WTO-case, because the Chinese infringers no longer infringe patents of companies, but are violating the rights of states.

Die AWS confirmed here (in German) that Farnleitner’s plan for an “Innovationsschutzprogramm’ will become reality this Fall. Read Die Presse article about it here (in German).

Sources for this blog: “Stories from the Trenches – intellectual property protection, anti-counterfeiting advice, tax and regulatory issues” China India Russia Investing in Emerging Markets Haas School ofBusiness, UC Berkeley, 2005; fast forward to 1 hour 4 minutes and 30 seconds:
http://video.haas.berkeley.edu:24874/ramgen/media-services/ClausenCtr/trenches.rm; and a phone call with dr. Georg Buchtela of AWS.

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Quoting US ITA’s Lavin On China: Yin and Yang Emphasised

Today, the People’s Daily Online put the optimistic title ‘IPR Moves Impress US Official’ above an article about a visit of US Under Secretary for International Trade Franklin L. Lavin to China.

Referring to counterfeiting in China, Lavin told reporters in the motor shop on Saturday that the Chinese Government is taking many effective measures on intellectual property rights (IPR) this year and “we are working closely” to resolve the issue. Read here.

It’s clear that the People’s Daily Online article emphasises the yang-side. So for balance one should read the article by Bill Savadove for the South China Morning Post and published on the site of Asia Media, of the UCLA Asia Institute, that emphasises the yin-side

“We are looking at possible WTO cases beyond a niche area,” US Undersecretary for International Trade Franklin Lavin told a news conference in Shanghai. “Our attorneys are increasingly convinced that China is in violation, but we’ve got to have an evidentiary basis that ensures we’re going to win the case.”Read here.

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MPA’s China Raids Don’t Yield Any Disc Burners Nor Arrests

The Motion Picture Association has finished an Asia-wide campaign against movie piracy.

Results:

  • China: 405 raids; 1,961, 255 pirated optical discs seized
  • Hong Kong: 119 raids; 90 DVD-R burners seized; 56 people arrested
  • Taiwan: 483 optical disc burners seized; 369,117 pirated optical discs seized; 97 people arrested.

Remarkable is that in China no disc burners were seized, nor any arrest. How is that possible?

There were also raids in India, Indonesia, Malysia and Thailand.

Read the press release of the Motion Picture Association of America (MPAA) here.

The name Operation Red Card may be inspired on the fiercest disciplinary sanction of the game of soccer.

However, hopefully those infringers that receive ‘red cards’ will not become ‘supercool’ as the French call their Zizou after the dramatic World Cup finale. Then again if they are, they should be casted as actors.

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China’s Domain Name Dispute Resolution Measures

Mondaq’s newsletter has a brief article by Angela Wang & Co. (sollicitors, agents for trademarks) about the new Domain Name Dispute Resolution Measures which came into effect on 17 March 2006. Read here (free subscription required).

It’s my humble opinion that everybody that blogs, comments and writes articles about Intellectual Property Rights in China should not underestimate the added value of links to the original laws, regulations, judicial interpretations, action plans, case law and what have you. I would appreciate it very much. Links rule.

Preacher do as you preach you might say. So here are the Rules for CNNIC Domain Name Dispute Resolution Policy.

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1-0 for the Chinese Pirates of the Xbox 360 Games

Games site Gamasutra went to Shanghai’s ChinaJoy game exhibition and saw that pirated Xbox 360 titles are widespread. Microsoft is denying that “the core security system has not been broken.” See Redwood’s official response here and Gamasutra’s article here.

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4 Chinese of MIP’s 50 Most Influential People

Managing IP Magazine (July 10) had nominated four Chinese as most influentual in the field of IPR.

  • Ms. Wu Yi (Vice Premier);
  • Mr. Tian Lipu (Commissioner of SIPO);
  • Mr. Zheng Chengsi (professor at the Law Institute of China Academy of Social Sciences);
  • Mr. Zhang Wei an (senior legal adviser on IP of General Electric Asia)

See at the SIPO site, here. Or an introduction to the MIP list via Google Cache here.

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Chinese Counterfeiting Addressed By US House Subcommittees

Two subcommittees (on Rural Enterprises, Agriculture and Technology and on Tax, Finance and Exports) on the House of Reprentatives have held a joint meeting in the U.S. Congress to consider whether China is enforcing its laws on intellectual property rights (IPR).

Testimonies were held by Mr. Tom Goodpasture, president of Pride Manufacturing Co., Inc.Liberty, MO;
Mr. George Russell, corporate legal administrator of Auto Meter Products, Inc. Sycamore, IL;
Mr. Brian Duggan, director of trade and commercial policy of Motor and Equipment Manufacturers Association;
Dr. Tom Duesterberg, president and chief executive officer of Manufacturers Alliance/MAPI;
Mr. James W. “Will” Coley, Warehouser National Cotton Council, Garden City, GA.

Read ABRN article about it here.

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SIPO: Pan’s Pen Patented

A retired teacher, called Pan, from Huzhou, Zhejiang Province has invented a pen to beat short sightedness. Read China Daily’s article here.

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Chinese Trademark Squatter Wants Ransom From PBS

Jocelyn Ford of Marketplace Public Radio reports about a Chinese Trademark squatter, a lawyer called Hou Songlin, who registered the PBS logo, never mind that PBS is an American non-profit organization facing budget cuts from US Congress.

Trademark lawyer Joe Simone of Baker & McKenzie was interviewed:
“Every week there’s numerous, obvious examples of piracy. On average we’ll find 15 or 20 of companies that we know.” But he says few companies pay ransom. Most lodge a complaint and that can stop the logo from being used in China for as long as eight years.

Simone’s explanation on how this is possible, you can see here.

According to Chinese law, PBS has until August to challenge the registration.

Hou Songlin (translated): It’s easy to make Chinese angry. And when we get angry we want revenge. If you file a complaint. I will never sell it to you!

Read or listen to this story, here.

Law firm Harris & Moure has a primer on Chinese trademark registration, urging foreign companies to register before they are entering China, see here.

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TGIF

Reason New censorship for Karaoke: IPR Protection or … Censorship?

Mike Magnier wrote a funny article ‘China’s Karaoke Police Have a Request: Do It Mao’s Way‘ for the LA Times, about China’s Ministry of Culture which issued new rules to prevent “unhealthy” songs and must help safeguard IPR. A system whereby karaoke bars will choose songs from a central database will be tested in Wuhan, Zhengzhou and Qingdao. If these pilot projects are succesful, it will be implemented nationally.

Magnier wrote: Beijing says it will not charge those using the database, although karaoke parlors would have to pay applicable copyright fees. That step is part of the government’s plan to “gradually” solve intellectual property rights disputes among the recording industry, artists and karaoke parlors.

Magnier interviewed Zhang Xingshui, director of the Beijing Kingdom law firm thinks differently: “They may have multiple motives. They say it’s for intellectual property rights protection, but it could be censorship in another form.”

Read the article here.

Swap Three Pirated DVDs for One Genuine DVD

Reuters wrote: For every three pirated discs handed in, a company based in the eastern city of Nanjing would hand over one real one, the China Daily said.Read the Reuters article here.

Update: I found this China Daily article by Wu Jian: ‘New Way To Fight Piracy’. Wu interviewed a former pirated disc retailer Luo Linxu:

We used to earn lots before 2000 when legal products were sold at a very high price. But we can earn only one yuan (12 US cents) or less now on a pirated disc, while the profit margin for a legal one is three to four yuan (37-50 cents).Read Wu’s article here.

Head tips to Shanghaiist, who has some legitimate criticism against a daughter who turns in the DVDs of her counterfeiting father, and worries about which DVD one gets in return, read here.

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Warner Bros.’s China Movie Takes Head Start In Race With Pirates

Yahoo run with a Reuters article about Warner Bros. new low budget China filmmaking joint venture “Crazy Stone,” released in cinemas on June 30, then followed with a DVD version selling for as little as 10 yuan ($1.25) just 12 days later.

Tony Vaughan, managing director for CAV Warner Home Entertainment Co., an Warner joint venture that handled the film’s home video release, said: We came out here with the aim of competing with the pirates on pricing and timing,” said Vaughan. “The fact that we’ve been able to go this early means we’ve been able to beat the pirates.

Read the Reuters article here.

However, Shanghaiist who elaborated on the subject (including film poster) noticed that although there were stories that said that somehow no black market DVDs of Crazy Stone were available during its first week of release, [b]ootleg DVDs are available now, what with perfect studio versions to copy from. We saw Crazy Stone at our local DVD shop yesterday for 7 kuai. Kuai is the colloquial term for yuan (Renminbi).

Read Shanghaiist’s article here.

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New Think Tank: HK Platform For Technology Transfer And IPR Trading

Hong Kong has a new think tank: Savantas Policy Institute.

Regina Ip, who was the former HK Secretary of Security, is now chairwoman of the board of governors of Savantas (Yahoo Actualités). According to Savantas, HK can be China’s platform for technology transfer and intellectual property rights trading.

Savantas Policy Institute is a think tank that consists of HK citizens that are educated or have working experience abroad and want to channel this knowledge back to the Special Administrative Region. It also wants to develop democracy, read an article about it by Carrie Chan for the HK Standard here. Ip herself has just returned from three years at Stanford University to finish an MA. Read the People’s Daily Online article here.

Why the think tank choose the name Savantas I am not sure. The funny thing is that Savantas is the name of an ominous cartoon figure, created by the late Willy Vandersteen, a Belgian who created also the famous cartoon figures Suske & Wiske. However, the figure Savantas may on paper not be the best person to look after intellectual property rights: In the book ‘De spietatoom’ Savantas stole a secret formula to shrink everybody. Ip’s think tank has exactly the opposite plan for HK’s citizens and IPRs.

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Taobao.com Enforces New Rules Against Copyright Piracy

ChinaTechNews has a short article about Taobao.com, the largest online auction site of China, read it here. It enforces copyright piracy in the following ways:

  • remove counterfeit goods after receiving complaint letters from the brand owners;
  • owners of online stores that are closed, will not be allowed to open at Taobao.com within 3 to 5 years;
  • a price limit will be set for each kind of good; those goods that are priced too cheap will be placed under observation.

The latter point is a nice pro-active rule I haven’t seen before.

Taobao.com cooperates with the new Xiangyang market in Shanghai, forming together Taobao City, see ‘The New Xiangyang: IPR Infringements Taboo At Taobao City?‘.

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Just Do Make Use Of Customs, But Recordation Is Needed

Dan Harris of China Law Blog attended a US Patent and Trademark Office’s seminar about Protecting your IP in China, see here the first of a series. Dan’s first favorite speaker was Kevin Brown, Nike’s director of global band protection who talked about drinking green tea, or in other words when in China, do as the Chinese. Moreover, Brown talked about the virtues of working with Chinese customs and Nike’s successes by doing so:

If you register your trademark in China, alert Chinese customs to that registration and provide customs with information on your product, Chinese customs will contact you if it sees possible counterfeits of your product going in or out of China. Mr. Brown then mentioned that in Canada neither the importation nor the exportation of counterfeit product is illegal; only the sale of such products is.

I just read a great article from Yu Xiang, The New Regulations Regarding Customs Protection of Intellectual Property Rights of the People’s Republic of China, IIC Volume 36, 7/2005. The importance of registration, or in other words recordation, can not be underestimated for ex officio action (because of one’s office, so on one’s own initiative).

Pursuant to article 16 Customs Regulations 2003, customs shall notify the right owner immediately, when they discover the goods suspected to infringe recorded intellectual property rights. Rephrased: customs recordation is required for customs’ ex officio action. Yu argues that because the recordation as a prerequisite for proceedings upon a right owner’s application was abolished and so was the provision that allowed customs to detain goods at their own initiative, “it is not really useful to maintain the recordation prerequisite for mere acts of inspection and informing right owners about possible infringements”. However, it makes sense in some cases that the intellectual property rights are recorded, so customs is getting more information about the goods. In fact recordation is often not enough to help customs distinguish between fakes and genuine products. In such circumstances it can be an option to give trainings to customs officials.

Yu writes that article 58 TRIPS prescribes that members which introduce standards for ex officio customs action, must adhere to the standards of article 58 a-c TRIPS.

Article 58 TRIPS states: “Where Members require competent authorities to act upon their own initiative and to suspend the release of goods in respect of which they have acquired prima facie evidence that an intellectual property right is being infringed: (a) the competent authorities may at any time seek from the right holder any information that may assist them to exercise these powers“.
However, one could interpret ‘any information’ as recordation of the intellectual property right and ‘at any time’, the point in time before an alleged infringement. So in my opinion article 16 Customs Regulations 2003 does not contravene article 58 TRIPS.

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IPR Enforcement in HK: Today Children Will be Men And Women?

‘Hong Kong enlists youth to fight piracy’ writes Keith Bradsher for the New York Times, which was published in the International Herald Tribune.

Today the ‘Youth Ambassadors campaing’ starts with 1.600 children (in the age of 9-25) pledging their participation in a stadium where movie stars and government ministers will talk encourage them to inform the authorities of unauthorised uploaded copyrighted material.

The idea to enlist children in law enforcement met a lot of criticisim. Emily Lau, a pro-democracy lawmaker, wanted more details for public debate and Christine Loh, chief exectutive of Civic Exchange, a policy research group was wary too, because the plan echoed the times of the Cultural Revolution. IP Dragon ventilated some concerns too: ‘HK Governement Recruits Youth As Informers In Battle Against Internet Piracy’, see here and ‘New HK generation IPR Ready or Snitches’, here.

Tam Yiu-keung, HK Excise and Customs Department’s senior superintendent for IP investigations said that: “We are not trying to manipulate youths and get them into the spy profession.” The idea is to arouse a civic conscience to report crimes to the authorities. So what is the procedure?

Bradsher writes:
When youths report to the authorities that movies, songs or other copyrighted material are being made available through an Internet posting, customs officials will verify the posting and relay it to trade groups like the Motion Picture Association or the International Federation of the Phonographic Inductry. The associations then send warning letters to the Web masters of the discussion forums asking them to delete the offending posting; the customs officials keep secret which child has spotted which posting.

Awareness is fine, stimulating to grow a conscience even more fine, but I still have some problems with the fact that children are pushed to report IPR infringements. What do you think?

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Wisconsin Ginseng Made In China?

‘Ginseng Farmers Protect Crop and Reputation’ writes Brian Bull at the VOA News.

Wisconsin ginseng farmer Butch Weege told Bull that Chinese officials recently contacted the Ginseng Board of Wisconsin regarding a customer complaint filed with the trade office in Shanghai, challenging the validity of some supposedly Wisconsin grown ginseng.

This was an image of our seal, it was being pirated,” he explains. “That little snowball has picked up in size and is now getting attention in Beijing. Sorta mind-boggling to us, the interest that the national government in China has taken in our particular case here. They’ll tell us we are the gold standard but [they] just are not certain that [they’re] getting genuine Wisconsin.

Read Bull’s article here

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How To Solve the Xiushui Market IPR Enforcement Dilemma

A short article titled ‘Beijing’s Xiushui Market in a dilemma: fakes still appear’ about Silk Street (Xiushui) market by Chinanews was published on IPR.gov.cn, see here.

The article mentioned law suits of the last months and the Memorandum of Understanding (MOU) between the the management of the market and representatives of 22 international famous brands, see here. To no avail.

“We understand the feelings of those vendors, they have to gain profits here,” an emphatic market managing official Fan said, responsible to protect IPRs: “But our market should follow IPR protection regulations and protect famous brands from fakes.” Maybe some of Fan’s words have lost in translation, but you don’t have to be a visionary to see that Fan has only a lukewarm commitment to protect IPRs.

Fan seems torn apart by conflicting interests: it is in the market management’s interest that the vendors are able to continue paying their management fees; but the IPRs need to be respected too and the MOU makes that unequivocally clear.

Fan should think along with the vendors to reposition the Xiushui Market and solve the perceived dilemma. From piracy/counterfeit market to … something else. After this rebranding, vendors should learn how to make a living with these alternative products, and tourists should be informed that they can get everything, except fakes at Xiushui Market.

Another thing is that the functionary who receives management fees and is dependent on these, should not be made responsible for protection and enforcement of IPRs. That should be someone else, who for example will get partly a performance based salery.

In fact, lessons may be learned from the conflicts of interests and localism at other levels of IPR enforcement in China.

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Sino-Dutch CMO’s Will Include Mechanical Rights In Reciprocity Agreement This Year

I got hold of the chapters about the East Asian Countries by Ang Kwee Tiang of Collective Management And Related Rights edited by professor Daniel Gervais of University of Ottowa. Very interesting.

Today, I spoke to Buma-Stemra, the Dutch CMO (Collective Management Organisation), who has a reciprocity agreement with the Music Copyright Society of China (MCSC), to see what happens when for example a song of the Dutch repertoire is used by a Chinese broadcaster, without remuneration. Johan Visser, of the legal department of Buma-Stemra, did not know whether this has ever happened. According to Visser Chinese copyright was not well developed so he was not shocked that only 5.000 companies in the whole of China pay for background music, see here.

Visser did not know whether Buma-Stemra or MCSC had ever to enforce their rights in China. However, he knew of one case where a translation was made of a song by Tony Eijk in Dutch which was translated into Chinese and put on CD by the Chinese subsidiary of Nutricia (which is a Dutch food company) as a sales promotion, whithout authorisation. Because the Sino-Dutch reciprocity agreement does not include mechanical rights yet, Buma-Stemra got directly into contact with the Chinese subsidiary, who paid the remunaration. So no real enforcement issue. The real news is that this year mechanical rights will be included in an amended Sino-Dutch reciprocity agreement. The exact date remains unknown yet.

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Research Paper’s Provisional framework of table of contents, hypothesis and bibliography

Table of Contents

1. Introduction

2. Hypothesis and Methodology

2.1 Hypothesis
China’s alleged non-compliance with TRIPS can be viewed from different angles. One can zoom in on individual Chinese IPR provisions to see whether they violate TRIPS (frog’s perspective). Or one can base its allegation on China’s general lack to ensure procedures that permit effective enforcement of IPR, which article 41 (1) TRIPS prescribes. The hypothesis that will be tested here is, whether fixing the non-compliant provisions are sufficient to overcome the “rampant” IPR infringements in China, or whether a more holistic approach to reform China’s IPR system, although more difficult, is needed.

2.4 Methodology
Since November 2005 the author has started a weblog called IP Dragon that gathers, comments and shares information about IPR in China, to make this field of law more transparent. After three hundred postings IP Dragon has cumulated relevant case law, laws and regulations and received interesting feedback from experts in the field. Mindful of the open source movement, during and after the process of writing, this thesis will be put online, which is an invitation to criticise the assertions made and to come up with dissenting opinions.
The hypothesis is tested by looking at the non-compliance with TRIPS at two levels. First an inventory of the violations of individual TRIPS provisions will be made. After that China’s channels of IPR enforcement will be scrutinized, the strengths and weaknesses analysed and aspects identified that can be seen as obstacles to an effective enforcement.

3. Violations of specific TRIPS provisions (frog’s perspective)

3.1 TRIPS scope
3.2 Violations of China’s IPR provisions

4. Violations of effective enforcement in general (holistic perspective)

4.1. Administrative enforcement
4.1.1 Copyright Administrations
4.1.2. Administrative for Industry and Commerce
4.1.3. State Intellectual Property Office
4.1.3. Administration of Quality Supervision, Inspection and Quarantine
4.1.4. General Administration of Customs
4.1.5. Use of courts outside China

4.2. Criminal law enforcement
4.3. Civil law enforcement

5. Conclusion

Literature

Blasek, Katrin, ‘Der Schutz bekannter Marken nach Chinas Beitritt zur WTO’, GRUR Int, volume 52, issue 1, 2004, pp. 13-20.

Blasek, Katrin, ‘The Protection of Well-Known Trademarks Following China’s Accession to the WTO’, IIC, volume 36, issue 3, 2005, pp. 279-388.

Bottenschein, Florian, ‘Die Bekämpfung der Markenpiraterie in der Volksrepublik China und Hongkong’, GRUR Int. 2005, issue 2, 2005, pp. 121-126.

Gervais, Daniel, ‘The TRIPS agreement: drafting history and analysis’, Second edition, London, Sweet & Maxwell, 2003, pp. 285-289, 327.

Green, Nathan, ‘Enforceability of the People’s Republic of China’s Trade Secret Law: Impact on Technology Transfer in the PRC and Preparing for Successful Licensing’, IDEA, volume 44, issue 3, 2004, pp. 437-467.

Guo, Shoukang, ‘TRIPS and Intellectual Property Protection in the People’s Republic of China’, GRUR Int.; volume 45: issue 4 ( 1996), pp. 292-295.

Guo, Shoukang, ‘Schutz von Urheberrechten im Cyberspace – Neueste Entwicklungen in der Volksrepublik China’, GRUR Int.; volume 46: issue 12 (2001), pp. 1011-1015.

Hays, Thomas, Zhang Yun, ‘New Amendments to the Copyright Law of the People’s Republic of China’, EIPR, issue 6, 2002, pp. 301-312.

Hughes, Justin, ‘IP Enforcement in China, a potential WTO case, and US-China Relations’, Written Statement before the US-China Economic and Security Review Commission, June 8, 2006, pp. 1-22. Available here

Li, Luo, ‘Legal Protection of Technological Measures in China’ EIPR, issue 2 (2006), pp 100-105.

Li, Mingxia, ‘How Will WTO Membership Affect China’s Intellectual Property Law?’, Revue de droit intellectuel l’ingenieur-conseil; volume 90: issue 12 (2000) pp. 449-493.

Li Xiangsheng, ‘Waiting for Supplements: Comments on China’s Copyright Law’, EIPR, issue 5, 1991, pp. 171-177.

Li, Yonghong, ‘From Patent Hearings Based on Experts’ Reports to a Rearrangement of the Re-Exemantion and Appeal System in China’, IIC, volume 31, issue 3, 2004, pp. 242-250.

Lin, John, ‘How to Protect International Organisations’ Names and Symbols in China’ EIPR, issue 5, 2003, pp. 212-214.

Lin, Ma, Wu Handong, ‘Der Schutz des geistigen Eigentums in china und seine Entwicklung’, UFITA, issue 1, 2005, pp. 209-229.

Liu, Xiaohai, ‘Enforcement of Intellectual Property Rights in the People’s Republic of China’, IIC, volume 32, issue 2, 2001, pp. 141-161.

Mertha, Andrew C., ‘China’s “Soft” Centralization: Shifting Tiao/Kuai Authority Relations, The China Quarterly 184, December 2005, pp. 791-810.
Available here.

Mertha, Andrew C., Statement before the US-China Economic and Security Review Commission, June 8, 2006, pp. 1-13. Available here.

Ranjard, Paul, Huang Hui and Benoît Misonne, ‘The Legislation Protecting Intellectual Property Rights and its Enforcement in the European Union and the People’s Republic of China: A Comparative Study’, EU-China Trade Project, December 2005, pp. 1-132.
Available here.

Steward, Terence P., Esq, Statement, before the US-China Economic and Security Review Commission, June 8, 2006, pp. 1-26. Available here.

Taylor, Ramona L., ‘Tearing Down the Great Wall: China’s Road To WTO Accession’, IDEA, volume 41, issue 1, 2001, pp. 151-171.

USTR, 2006, Special 301 Report, April 28, 2006, pp. 1-47.
Available here.

Yonehara, Brent T., ‘Enter the Dragon: China’s WTO Accession, Film Piracy and Prospects for the Enforcement of Copyright Laws’, UCLA Entertainment Law Review, volume 9, issue 2, 2002, pp. 389-424.

Yu, Peter K., ‘From Pirates to Partners (Episode II): Protecting Intellectual Property in Post-WTO China’, American University Law Review, Vol. 55, 2006, pp.94.
Available at SSRN: http://ssrn.com/abstract=578585

Yu, Peter K., ‘From Pirates to Partners: Protecting Intellectual Property in China in the Twenty-First Century’, American University Law Review, Vol. 50, pp. 70.
Available at SSRN: http://ssrn.com/abstract=245548 or DOI: 10.2139/ssrn.245548

Yu, Peter K., ‘Still Dissatisfied After All These Years: Intellectual Property, Post-WTO China, and the Avoidable Cycle of Futility’, Georgia Journal of International and Comparative Law, Vol. 34, 2005, pp. 12.
Available at SSRN: http://ssrn.com/abstract=578584

Yu, Peter K., Chang, Gordon G., Cohen, Jerome, Economy, Elizabeth C., Hom, Sharon and Li, Adam Qi, ‘China and the WTO: Progress, Perils, and Prospects’, Columbia Journal of Asian Law, Vol. 17, p. 1, 2003, pp. 30.
Available at SSRN: http://ssrn.com/abstract=491444

Yu, Peter K., ‘Piracy, Prejudice, and Perspectives: An Attempt to use Shakespeare to Reconfigure the U.S.-China Intellectual Property Debate’, Boston University International Law Journal, Spring 2001, pp. 57.
Available at SSRN: http://ssrn.com/abstract=262530 or DOI: 10.2139/ssrn.262530

Zheng Chengsi, ‘Looking into the Revision of the Trade Mark and Copyright Laws from the Perspective of China’s Accession to WTO’, EIPR, issue 6, 2002, pp. 313-323.

Relevant case law mentioned at ipdragon.blogspot.com will be made explicit in the following versions.

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Telsda: ‘Seizing Opportunities In The Sky’ Or Blatant Design Patent Infringements?

CH of Mobimania.com, a French site about mobile gadgets, posted a great article about Chinese mobile phone maker Telsda, which Chinese name consists of three characters, that can be translated with ‘seize the opportunities in the sky’. See what happens when this company is just doing that and copying the designs of Nokia, Sony, Motorola and Samsung as if they are free like the air. Read CH‘s story here (French).

Chinese Law Blog has a posting about Nokia’s law suit against Shenzhen Telsda Mobile Communication Industry Developing Company, Ltd., among others. Read here.

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China’s IPR Enforcement Hurts: …China

Joe McDonald wrote for the Associated Press a big article on how Piracy Hurts China’s Own Industries, which was picked up by the Washington Post.

McDonalds writes:
Web sites that carry unlicensed copies of CDs often give away the music for free and make money from advertising. That takes advantage of a provision in Chinese law- one that trade groups are lobbying Beijing to change – that requires pirated goods to be sold before violators can be prosecuted.

However, if one looks at the Criminal Law of the People’s Republic of China of 1997 this does not seem to be the case:

Article 217: A person who, with a view of profit, commits any of the following acts of infringing upon copyright, shall be sentenced to fixed-term imprisonment of not more than three years or criminal detention and concurrently or independently, to a fine if the amount of illegal gains is relatively huge or any other serious circumstance exists; and if the amount of illegal gains is huge or any other especially serious circumstance exists, to fixed-term imprisonment of not less than three years and not more than seven years and concurrently to a fine:
(1) to reproduce and distribute, without the permission of a copyright owner, a written work or musical, cinematic, television or video work, or computer software or any other work of the latter;
(3) to reproduce and distribute, without the permission of a phonogram or videogram producer, a phonogram or videogram produced of the latter;

For unauthorised music at websites that make profits because of advertising there is in my opinion nothing in this provision that prevents a prosecution. There is no need that the pirated goods must first be sold before the pirates can be held criminally liable.

Nevertheless selling is required for counterfeited trademarks:
Article 214: A person who knowingly sells goods bearing counterfeited registered trademark shall be sentenced to fixed-term imprisonment of not more than three years or criminal detention and concurrently or independently, to a fine if the amount of the sale is relatively huge and; if the amount of the sale is huge, to fixed-term imprisonment of not less than three years and not more than seven years and concurrently to a fine.

Neither is selling a requirement in case of litigation because of copyright infringement:
article 47 (3) of the Amended Copyright Law of 2001 states:
reproducing, distributing a sound sound recording or video recording of a performance, or transmitting the performance to the public through the internet without the consent of the performer, unless otherwise provided in the law (Exceptions of the Rome Convention article 15).

McDonald may have meant that if the actual damages can not be calculated, only 500.000 yuan can be awarded for the infringing act (article 48).

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TGIF: New Zealand Struggles With Stance Over IPR in China: Speak Up or Hush Up?

One News reports about the ongoing discussion in New Zealand whether the Kiwis are too Politically Correct concerning China.
Since New Zealand is “not significant on a global stage”, talking about the lack of IPR enforcement or working conditions in China would only stall trade talks, asserts Andrew Grant, Oxford scholar and head of McKinsey & Company’s Greater China Office in Shanghai. See here the article and click below the photo in the article to see a more elaborate video about the subject.

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Nokia Design Patent Infringements: Next Level of Sophistication/Statutory Damage

Nokia has sued:

  • Shenzhen Telsda Mobile Communication Industry Developing Co Ltd
  • Song Xun Da Zhong Ke Electronic (Shenzhen) Co Ltd

and their distributors:

  • Beijing Tongwanbao Commerce & Trade Co Ltd, An Wai Avenue No 2 Branch
  • Beijing Xin Tongwanbao Commerce & Trade Co Ltd

before the Beijing No 2 Intermediate People’s Court, for infringing their design patents of the Nokia 7260 mobile phone.

Nokia demands:

  • the companies to cease making and selling the allegedly infringing phones
  • to pay damages and costs. The company is seeking the statutory maximum in damages in Chinese law of Rmb 500,000 ($62,500).

In China designs can be protected by patent; ‘the patent right for design’.

Article 59 Amended patent law of 2001. “Where any person passes any non-patented product off as patented product or passes any non-patented process off as patented process, he shall be ordered by the administrative authority for patent affairs to amend his act , and the order shall be announced, and he may be imposed a fine of no more than RMB 50,000 yuan.”

However, “according to a judicial interpretation issued by the Supreme People’s Court, damages can be a multiple, normally between one and three times, of the reasonable royalty. If there is no such royalty, or if the royalty is obviously unreasonable, courts often resort to quasi-statutory damages ranging from RMB 5,000 (US$620) to RMB 500,000 (US$62,000). The court may, at the request of the patentee, include reasonable expenses and all or part of attorneys’ fees into the damages award. However, recovery of all attorneys’ fees is unlikely.” Source: Patent Litigation in Chinese Courts, by J. Benjamin Bai, Helen Cheng and Peter Wang of Jones Day.

I googled to find the relevant judicial interpretation. The secondary sources, although very prominent ones were easy to find. Jiang Zhipei, Justice of the Supreme People’s Court who handles especially IPR explained the Provisions of Judicial Interpretation of Supreme People’s Court on Questions Regarding Applicable Laws for Adjudication of Patent Dispute (also mentioned as .. the Applicable Laws in Deciding Patent damages). According to Jiang the ration damage charges the defendant to make economic compensation to the plaintiff under the situation mentioned above. This is another method of calculating damage in consideration of the characteristics of intellectual property infringement, in compliance with the “pre-fixed damage” of TRIPS as well as “Statutory Damage” adopted by some other countries. Jiang: In order for the People’s Court at various level applying the ration damage uniformly, the Supreme People’s Court defines the ration damage in a range of 5,000 Yuan RMB to 500,000 Yuan RMB on the basis of years of experience. See here. Another secondary source, again very honorary is that of Luo Dongchuan, deputy chief judge of the Third Civil Tribunal of the Supreme People’s Court of China wrote in 2003 a comparative study on the Judicial Protection of Intellectual Property for IIP Bulletin: From the Viewpoint of the Trial of Intellectual Cases between China and Japan.

Both judges most probably mention the same document but name it differently due to discretionary translation possibilities. Finally: the primary document of Several Provisions of the Supreme People’s Court on Issues Relating to Application of Law to Adjudication of Cases of Patent Disputes (19 June 2001) at the interesting site of Linda Liu & Partners.

Article 21 of this Judicial Interpretation: If it is difficult to determine the losses suffered by the patentee or the profits gained by the infringer but there is the patent royalty which can be used as a yardstick, the people’s court may determine the amount of damages by appropriately taking one to three times the said patent royalty as a basis according to factors such as the type of patent, the nature and circumstances of the patent right infringement, the amount of the patent royalty, and the nature, scope and time of the said patent royalty. If there is no patent royalty which can be used as a yardstick or the patent royalty is apparently unreasonable, the people’s court may determine the amount of damages to be a minimum of 5,000 Yuan and a maximum of 300,000 Yuan in general according to factors such as the type of patent, the nature and circumstances of the patent right infringement, the amount of the patent royalty, and the nature, scope and time of the said patent royalty. The amount of damages shall not exceed 500,000 Yuan.

Shahnaz Mahmud interviewed for MIP Horace Lam, IP consultant at Lovells in Beijing and concluded: “Without evidence to show generated revenue from the mobile phone replicas, Nokia can only claim statutory damages.”
Lam said: “The likelihood that Nokia will succeed is good. Judging by the copies, its design patent seems valid”.

Mahmud interviewed also Justin Davidson, partner with DLA Piper Rudnick Gray Cary in Hong Kong, about the case.

“Davidson [..] said that this case reflects a trend where Chinese companies are moving to the next level of sophistication in copying a shape without copying the trade mark.”

Read the MIP article here.

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The New Xiangyang: IPR Infringements Taboo At Taobao City?

Xiangyang Market in Shanghai, synonymous with counterfeit and pirated products, closed June 30th. But now it seems to have risen out of its ashes, in a hybrid form. The market stalls of Xiangyang meet Taobao, the Consumer-to-Consumer site of Alibaba.com. Will this ‘city’ of bricks and clicks respect IPR or will counterfeiting and piracy just virulently expand online? What do you think?

Source: Pacific Epoch, see here.

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Message IP Dragon: Research About China and TRIPS Online

After 300 posts gathering, commenting and sharing about IP in China, it’s time to focus on one aspect in particular: Enforcement. This December 2006 it will be 5 years after China has acceded to the World Trade Organisation (WTO). Part of the WTO Treaty is the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). So it is a timely question to ask whether China complies with TRIPS after this half decade.

I will research this question in a formal way by stating a hypothesis, using a table of contents and notes (if possible links). All postings are works in progress but my research should be finished by the end of August. I invite you to challenge any assertions I make, logical fallacies, warn me about things you don’t understand and point me to anything that can shed new light on the subject, notify me of relevant papers, cases and examples. I would really appreciate it. It would be in your interest as well, because, in the end, the quality of this thesis is an important factor that could ensure that I can start blogging about IP in China, but then regularly from China, so that I could inform you better.

The journey of a thousand miles begins with one step, so here is the first.

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Top 5 Google ‘Intellectual Property China’ Search

If you type ‘intellectual property china’ in Google you’ll find:

1. SIPO
2. A practical guide for US companies
3. An old site of Steven Suranovic that wants to serve as a portal, but has links to advertisments to holiday destinations
4. Ben Worthen’s article on CIO blogs about IP: China’s three realities.
5. IP Menu which is a list of relevant links.

Worthen (nr. 4) wrote a readable and first hand experienced article that contends that if you talk about China, you have to distinguish between the government, the business community and the people. This may equals kicking in an open door, but it’s sometimes good to realise these facts in the same vain as the distinguisment between the urban thriving China and the dirt poor countryside China.

Hope some day you will find IP Dragon in this region of Google using these search words.

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Fifth Meeting of Guangdong-Hong Kong Expert Group on the Protection of IPR

The Special Administrative Region of Hong Kong and Guangdong province cooperate together in the protection of copyrights. In 2003 they established the Guangdong-Hong Kong Expert Group on the Protection of Intellectual Property Rights.

Read the expert group’s press release here and Xinhua’s article on the CRI English’s site here.

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TGIF: Watermelons’ Trademarks are Protected But Are they HIV-proof?

Li Xiran of the Shanghai Daily reports on something rather bizar.

Local of farmers of Fanji town, Linquan county in eastern China’s Shandong Province registered a trademark and established an association to protect their watermelons crops. However, the Xin’an Evening News, a Hefei based newspaper, reported about a bizar rumour that was spreading fast. Read more here.

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Chinese Bloggers Want Their Copyright Better Protected

Following the example of a female blogger (name not mentioned in the ChinaNews.cn article), who sued a famous website for reproducing her article without her permission and asked for a compensation of 100,000 yuan (US$12,500), more bloggers want their copyright better protected.

Blogger Wang Xiaofeng, who became famous for his blog “the massage breast”, said that a certain newspaper has copied his column for half a year while he knew nothing about that. He discovered that all the contents on the “column” were copied from his blog.Another blogger complained that his article was published on 50 newspapers, of which only three sent him his remuneration. The remaining 47 did not even call him.

It may be the greatest compliment to get copied as a blogger, but bloggers like any other rights holder don’t have to put up with anything less than to be asked permission and provided with a remuneration. However, it’s hard as a blogger to defy costs, time and efforts connected with law suits.

Read more here.

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Pressure On China To Enforce IPR Started Early/Late?

A senior Chinese IPR governor, who remained unnamed in the Xinhua article, did not expect that China would be under internationa pressure on its handling of intellectual property rights already. The title of the Xinhua article ‘China faces international pressure on IPR earlier than expected’ is as strange as the remark of the unnamed Chinese IPR governor.

China did not expect international pressure so early?

From 2002 onwards, the USTR has already been urging China to better enforce its IPR, besides other countries and the EU.

Among the 111 complaints the U.S. International Trade Commission (USITC) has lodged under Section 337 of the Tariff Act of 1930, 42 have been against Chinese enterprises, according to Tian Lipu, director of SIPO. See the filed complaints here.

Available under Section 337 investigations is an exclusion order that directs Customs to stop infringing imports from entering the United States. In addition, the Commission may issue cease and desist orders against named importers and other persons engaged in unfair acts that violate Section 337. Expedited relief in the form of temporary exclusion orders and temporary cease and desist orders may also be available in certain exceptional circumstances. Read about Section 337: Insiders Chinese Ink Cartridge Dispute About Section 337: “Weapon of Mass Destruction”

Read the Xinhua article on People’s Daily Online here.

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Government Protection Against Chinese Copyright Infringement?

Frank Ahrens of the Washington Post wrote the article ‘US Joins Industry in Piracy War’, about the US government’s support to MPAA and RIAA in the battle against copyright infringements in China and Russia.

MPAA’s CEO Dan Glickman said about Russia’s possible entrance to WTO:
We let China in and China has not fully complied with the WTO requirements” for protecting intellectual property, Glickman said. The MPAA has an enforcement division in Hong Kong whose members accompany local law enforcement officials on raids. “The time to get action is now, rather than after they get in.
Read the WP article here and an Earthtimes article here.

Alexander Grundner is questioning whether the US governement should partner with the entertainment industry to crack down on global piracy:
We have separation of Church and State, when are we going to see separation of Special Interest Groups and International Policies?

Grundner asks how the content industry can claim full price if the content is not physically produced by the content industry. This question is based on a weak argument. Nobody is questioning whether a newspaper seller can claim full price of a newspaper, although he did not produce it physically. In casu, the internet is adding value by distributing the content to use it in a very userfriendly way.
Grundner’s second argument is that the products are to pricy. This may be true, but it is the freedom of every seller to offer the goods/services for the price he deems fit(we are not talking about monopolists of bread or water) , and it is not a justification for piracy.

There is nothing wrong with governments that protect its businesses’ interests abroad. Of course a disproportionate amount of resources allocated to the entertainment industry, is not desirable. In order to see if this is the case, you need to weigh the importance of different industries for the national economy.

Read more here.

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China Joins World Semiconductor Council

China Semiconductor Industry Association (CSIA) has officially joined the World Semiconductor Council (WSC). According to the organisations it is expected issues relating IP protection (layout designs of integrated circuits) will be resolved amicably.

Read the Electronic News article here, head tip to Philip Brooks’ Patent Infringement Updates.

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Fatal Fake Fags From China Seized In Northern Ireland

“These things originate in China and are made in factories that are subterranean cabins you access through a hole in the ground“, said Paul Gerrard, deputy head of UK Customs enforcement.
Read Ciaran McGuigan’s article for Sunday Life here.

Chinese counterfeits of brand-name cigarettes (that are already deadly) contained:

  • five times as much cadmium as normal ones (which can also severely damage lungs and is linked with kidney disease);
  • nearly six times as much lead (which damages the organs and nervous system)
  • high levels of arsenic (which increases the risks of lung, liver and other cancers)
  • 160% more tar;
  • 80% more nicotine;
  • 133% more carbon dioxide.

Read Suzanne Breen’s article for the Sunday Tribune here.

Made underground, these cigs surely can get you there too.

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Where In China Do IPR Infringements Take Place?

Thanks to specilisation and economies of scale you find all kinds of clusters of IPR infringements in China; certain IPRs of certain product categories are prone to be infringed in certain provinces, regions or cities.

Chinese Law professor Blog‘s Donald C. Clark wrote about the USTR that announced in the Special 301 Report of April 28, is would conduct a special provincial review (SPR) of IPR in China. First step will be invitation to the public to comment about the locations and issues that should be the focus of the review. Deadline July 14, see specs here.

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Copyright Enforcement in China: Stallman More Succesful than Microsoft?

Richard Stallman, father of the free software movement, wrote that they might have more success enforcing copyright in China than Microsoft, Disney and Sony:

Disney wishes to stamp out semi-underground organizations that sell exact copies. With free software, regardless of the type of license, that kind of copying is legal. What we want to prevent, when the free software license is the GNU GPL , is the release of proprietary software products based on our code. That kind of abuse is at its worst when carried out by large, well-known companies — and they are easier targets for enforcement. So GPL enforcement in China is not a lost cause, though it won’t be easy.

Read Stallman’s article here.

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Olympianise IPR Enforcement

Singapore’s TODAYOnline run an AFP story about whether Beijing markets still sell fake products, a day after some landlords of those markets had signed a memorandum of agreement with 23 luxury companies that they would not sell fake versions of their products.

The unnamed journalist visited three Beijing markets:

Silk Alley Market (I think the journalist means Silk Alley Plaza (or Silk Street Plaza), since Silk Alley Market has been closed down)
The landlord of this market, Xiushui Haosen Clothing Company, has signed the memorandum of understanding with 23 luxury companies see here (and here about Lacoste suing the landlord). According to a sales assistent in the market, there are ‘regulations’ about which brands you cannot sell. “All the big names like LV or Prada, are not allowed.” It is not clear which regulations the sales assistent means. Is he talking about a list of 48 frequently copied famous foreign trademarks, including Prada, Chanel and Burberry, that the Beijing government provides special protection for, see here, or about the memorandum of understanding and Louis Vuitton and Prada that are part of the list of 23 luxury companies? The market is “more frequently inspected” for these brands. When they find such brands, they are confiscated and the seller fined. The journalist calles this “embryonic signs of vigilance in Silk Alley Market.” However, fake versions of other brands, such as Ralph Lauren are freely sold. They are probably not on the list of 48 famous trademarks or 23 luxury companies (?).

Allien’s Street
Knock-offs of brands such as Gucci and Luis Vuitton, catered to Russians and Malaysians, who buy these counterfeit products whole sale. I don’t know if the landlord of this market signed the memorandum of understanding.

Chaowai Men market
Counterfeit Burberry, Chanel, Gucci, Luis Vuitton products are sold. I don’t know if the landlord of this market signed the memorandum of understanding.

Notice that no seller dares to sell Beijing 2008 Olympic merchandise, without any landlord signing any memorandum of understanding in advance. Geoffrey Fowler of the Wall Street Journal wrote in 2005: The government made the logo an official priority in 2002, passing a national law exclusively to defend the intellectual-property rights of Olympic symbols. That law technically just collects existing laws in one place, applying them to Olympic logos for all levels of government.This either has facilitated enforcement significantly for administrative authorities or the fines and even imprisonment has enough deterrent effect on market sellers, or both.

Read AFP’s story here.

The governement should apply the experience of the enforcement of the trademark of the Olympic Games to other trademarks and take heed to the Olympic motto: higher, faster, stronger.
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Crash Course: How to Detect A Fake Fashion Item

Some counterfeit fashion items from China and India are very hard to detect. The quality can be as good as the genuine product. And some are priced as high as the real thing.

Read D. Parvaz’ article for the Seatlle Post Intelligencer here. More about counterfeiting, read CounterfeitChic, by law professor Susan Scafidi.

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Kuslan’s Brief Introduction to IPR in China

Richard Kuslan of Asia Business Intelligence wrote an excellent ‘Brief Introduction to Intellectual Property Rights in China’, which consists of the speech he gave at the World Trade Week. It starts with an interesting anectode, he experienced himself: An American auto parts maker finds out that his trademark is infringed, and that car parts under his brand name are made in South Korea and sold, not in the US but in China. The attitude of “Mr. Liu” in this anecdote is telling that he is interested in foreign branded products that can persuade Chinese consumers that they are buying a genuine foreign (in this case American) product, rather than that it had to be made by the company that actually owned or had been granted rights to manufacture the popular brand.

Another interesting anectode Kuslan cannot confirm but deems plausible: A Chinese auto parts maker exported product made in its Chinese factories to be re-packaged outside of China and then re-imported as so-called “genuine foreign-made” imported product.

After these two appetizers Kuslan explains why IPR matter in China, expounds on an IPR strategy and the different ways to enforce IPR in China. Read Kuslan’s article here.

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