China's innovation drive needs to be underpinned by intellectual property right protection. The Ministry of Commerce held a press conference today to discuss how China will work on intellectual property right enforcement.

Intellectual property rights are a major headache for many companies operating in China, especially internet companies. Many internet entrepreneurs leave China as their ideas are easily copied.

"when you talk about innovation and startups in China the biggest concern is intellectual property. In China big companies can easily copy small company's ideas and make them disappear. They are also being copies by other startups. This is killing internet innovation in China," David Wei, Chairman and Founding Partner of Vision Knight Capital, says.

The Ministry of Commerce says that China will step up enforcement of intellectual property rights in the coming year and increase scale of punishment.

“When it comes to copy right infringement, China has upgraded the trademark law this year, increasing the punishment. They are also working on upgrading the copyright law and patent law. We hope that these three laws will help protect the rights of internet companies," Chai Haitao, Director General of IPR Office of Ministry of Commerce, says.

In addition to improving the legal framework and handing out tougher penalties, last month the Chinese government proposed a "name and shame" system to deter companies from infringing on intellectual property rights.