CHINA INFORMATION TECHNOLOGY LAW NEWSLETTER
Vol. 2, No. 8 - June 26, 2001
TOPICS THIS ISSUE:
- Patents Lagging Behind in China
- 10th Five-Year Plan to Benefit IT Sector
- Preferential Tax Treatment for High-Tech Firms
- High-Tech Conference To Be Held In Beijing
- High-Tech Products Exports Grow
- Chinese Companies to Produce Multi-Layer Transformers
Patents Lagging Behind in China
The China Securities Journal has reported that China is not keeping up with international competition in its filing of patents for new technology. Statistics released recently by the Science and Technology Department under the Ministry of Information Industry show that while a third of patents filed in China come from the IT sector, in some fields only 10 per cent represent patent filings coming from domestic inventors. The majority of China's 74,000 patents filed last year come from a handful of developed countries, such as Japan, the United States and Germany.
In fields such as fiber-optic telecommunications, digital storage, integrated circuit technology and mobile communications, the number of patents from foreign countries far outweighed domestic applications and the gap has been increasing in recent years. The data reserve and mobile telecommunications sectors reported the most patent applications. Among China's top 100 information technology companies, only 44 of them have applied for patent protection. The statistics also highlighted that the huge amount of research and development funds spent by companies is not reflected in the number of patents filed annually.
(Source: China Online)
10th Five-Year Plan to Benefit IT Sector
The Vice-Director of the State Information Center, Liu He, has revealed that China will be allocating US $500 billion towards the IT sector during the 10th Five-Year Plan (2001 - 2005). This would represent an increase from the current 4.5% of China's GDP to 7% by 2005. Liu said television coverage will be increased to 95% of the country, and telephone density will increase from the current 35% to 70%.
Liu noted that IT companies in China should pay heed to the example set in the United States where economic slowdowns have occurred due to equipment redundancy. He said that before starting an IT business, the start-up should be cautious about the security of e-commerce, the potential of their business and whether customers will be accustomed to doing business on-line. Liu also stated that the government should improve the range of IT laws in China, and that the government's main task should be to improve the transparency of the market.
(Source: China Online)
Preferential Tax Treatment for High-Tech Firms
The central government of China has released a set of preferential taxation policies designed to assist the development of high-tech enterprises. According to the notice issued by the State Council, "high-tech" firms will be able to operate for their first two years without paying income tax. For three years thereafter, the enterprises will be exempted from half their income tax. Business income tax will be reduced to 10% for export-oriented high-tech companies whose export value accounts for at least 70% of their total production.
The Ministry of Science and Technology has defined what is meant by "high-tech" - according to a notice issued by the Ministry, high-tech enterprises means enterprises in the fields of information technology, micro-electronics, space technology, photoelectric products, new material science and bio-ecology, medical science, marine industries and environmental protection technology.
The notice states that a "high-tech" company must have at least 10% of its employees involved in high-tech research and development, and must inject at least 5% of its annual sales income into technical research. Further, these firms' income from high-tech products should account for 60% of their total income.
(Source: China Daily)
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High-Tech Conference To Be Held In Beijing
The Beijing Municipal Office of Taiwan Affairs is organizing a high-technology investment conference to be held in Beijing from August 2-3, 2001. The Office reports that a group of international investors will have the chance to meet Chinese high-tech companies and experts to exchange ideas and broker investment deals.
The CEOs from a number of international venture investment companies and various high-tech company chiefs will deliver speeches. Officials from the various state departments responsible for China's high-tech industry will also be in attendance to talk about government policy.
(Source: China.org.cn)
High-Tech Products Exports Grow
According to Beijing Custom officials, the export of high-tech products by May this year had reached US $916 million, accounting for half of total exports for the city and representing a 78% increase over last year's figures.
High growth rates were reported for computers and telecommunications, with a year-on-year growth of 200% (with an export volume of US $754 million), and life science and bio-science products, with exports of over US $35 million and US $1.33 million respectively. According to Customs, the majority of exports went to Hong Kong, Japan, Europe and the United States.
(Source: China.org.cn)
Chinese Companies to Produce Multi-Layer Transformers
Construction has begun on a production facility for multi-layer piezoelectric ceramic transformers in Xi'an, capital city of Shaanxi province. The plant will be capable of producing 10 million units per year. Once the Xi'an plant commences operation, China will become the world's second largest producer of the transformers, behind Japan.
The transformer will be crucial to the development of mobile phone technologies, computers and other intelligent information appliances. The transformer was jointly developed by Tsinghua University and Shaanxi Kanghong Information Technology Co, and belongs to the third generation of intelligent transformers. The transformer will allow products to be much smaller and lighter, and much more energy efficient.
(Source: Asia Pulse)
Lehman Lee & Xu
China Lawyers, Notaries, Patent, Copyright and Trademark Agents
Suite 188, Beijing International Club
21 Jianguomenwai Dajie, Beijing 100020 China
Tel.: (86)(10) 6532-3861
Fax: (86)(10) 6532-3877
mail@chinalaw.cc
http://www.chinalaw.cc/
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