CHINA VIRTUAL INTELLECTUAL PROPERTY LAW NEWSLETTER
Vol. 1, No. 25 - November 13, 2000
Lehman, Lee & Xu
China Lawyers, Notaries, Patent, Copyright and Trademark Agents
(formerly known as the L&A Law Firm)
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Anti-Counterfeiting Campaign Launched
The State Council has taken steps to crack down on the production and sale of counterfeit and substandard goods nationwide. The launch of this anti-counterfeit campaign was announced in a recent circular issued by the Council.
The massive campaign will last through January 24, 2001 and aims to protect the interests of consumers and enterprises. In this campaign, localities have been urged to participate in the program by educating themselves on the issue as a means to increase its effectiveness.
The media has also been encouraged to participate in the crackdown; the rules on rewarding those who give tips or participate in the campaign will be stipulated in accordance with relevant laws and regulations.
According to the State Council's circular, some of the areas that are in the worst shape include farm chemicals, automobile parts, cigarettes, medical products and cosmetics. Substandard products and counterfeit goods are marring the reputation of China's products, both at home and abroad.
Efforts will be focused on major cases, with severe punishments intended for the most serious offenders in crimes involving large amounts of money.
The State Council circular urges the combining of this campaign with the current anti-corruption drive by punishing the officials who are collaborating with the producers and sellers of fake goods. In addition, calls were made for the improvement of relevant laws and regulations and strengthening law enforcement.
A national coordination office for the campaign will consist of officials, government departments, judicial departments, the armed police, and the Publicity Department of the Central Committee of the Communist Party of China.
(Source: Xinhua News Agency)
China Creates Fund for Overseas Patent Filings
In a move to facilitate patent applications overseas, the government has announced that it will set up a special fund for domestic enterprises. The fund is intended to ease the overseas technological patent application process.
The establishment of the fund aims to further support the industrialization of high-tech research results, as well as to protect the country's major enterprises and institutions, according to Jiang Ying, a commissioner of the State Intellectual Property Office (SIPO). Some domestic enterprises and research institutes failed to have their advanced technologies recognized in international markets because they did not apply for patents in foreign countries.
Some domestic enterprises and research institutes failed to have their advanced technologies recognized in international markets because they did not apply for patents in foreign countries. In an effort to help them release their patents on the market, enterprises developing technologies that they plan to have patented will enjoy preferential funding and taxation policies. It is hoped that this will encourage more domestic enterprises to apply for patents, thus avoiding any future problems or revenue loss.
To further improve the awareness of patent protection among enterprises and research institutes, China will work out relevant regulations to ensure patent holders are correctly protected, Jiang said. He also urged regional patent administrations to weave patent protection into technology innovation projects to help reinforce enterprises' competitiveness.
(Source: AFX - Asia)
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US Trade Official Slams China's IP Record
Assistant US Trade Representative Joseph Papovich, during a three-day visit to Beijing to discuss IP issues, told the press that China's enforcement regime has a long way to go before it is sufficient to deter infringement.
After citing a long list of procedural and substantive legal weaknesses in the system, Papovich maintained that the recent announcement by the State of a three-month nationwide anti-piracy campaign was not enough to make a difference, although he applauded the effort to go after manufacturers and distributors, as opposed to the "small fry" retailers.
Papovich focused on lax enforcement, particularly length of criminal sentences and size of civil fines. Without adequate deterrence, he stated, China's 14-year effort to join the World Trade Organization (WTO) might be difficult.
In his opinion, the problem would not be seriously addressed until attitudes towards the problem change. Papovich concluded by saying that as long as the government perceives counterfeiting as merely a threat to foreign companies, the issue will not be dealt with vigorously.
(Source: Agence France Presse)
UPI Article Misses the Point
A recent article reporting on an announcement made by Li Guoguang, vice president of the Supreme People's Court, almost conveyed the real problem with counterfeiting in China. Almost.
The announcement stated that World Trade Organization (WTO) rules would supercede Chinese laws in future civil suits where foreigners or foreign companies were one of the parties.
"When handling foreign related cases, courts at all levels should apply WTO rules when there are discrepancies between these rules and the Chinese laws," Li was quoted as saying. Mr. Li went on to warn an audience of judges that a large number of intellectual property cases would be filed following China's entry into WTO.
The article went on to state that "Counterfeit goods are most often the norm in China and foreign businesses have had little luck in battling pirates in the mainland's legal system. China's judiciary has in recent years tried to remedy the situation but often there are no laws in place for such offenses or judges apply extremely vague legal codes that usually end up favoring the pirates over any outsider with a grievance."
Although there is no doubt that piracy is a huge problem for foreign businesses, one would be better served listening to Assistant US Trade Representative Papovich's comments regarding enforcement. Looking at the intellectual property legal framework from an academic sense, protection for foreign businesses is quite extensive. A judgment can often be obtained in China, but with damages being at times absurdly low and enforcement varying widely across the country, foreign businesses have suffered under the system as a whole. However, even if WTO rules strengthen substantive law, foreign businesses will not see a great measure of relief from pirates until the government tackles the enforcement problem.
(Source: UPI)
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China Sets Up Group to Crack Down on Fake Products
The State Council has recently decided to set up a "National Small Group for the Coordination of Fighting Production of Fake Items" in an effort to effectively organize a unified national operation to crack down on fake good. The production and sale of counterfeit goods is a criminal offense. State Council Vice-Premier Wu Bangguo heads the group whose first meeting was held on 27 October.
The National Small Group for the Coordination of Fighting Production of Fake Items is composed of the following departments: the State Economic and Trade Commission, Ministry of Public Security, Ministry of Supervision, Ministry of Finance, Ministry of Agriculture, Ministry of Foreign Trade and Economic Cooperation, Ministry of Health, the State Customs Office, the State Administration of Industry and Commerce, the State Bureau of Quality and Technical Supervision, the State Bureau of Pharmaceutical Supervision and Management, the State Council Legislative Affairs Office, the State Council Research Office, the State Tobacco Monopoly Bureau, the Ministry of Propaganda, the Supreme People's Court, the Supreme People's Procuratorate (Prosecutor), and the Headquarters of the Chinese People's Armed Police Force.
The Office of the National Small Group for the Coordination of Fighting Production of Fake Items is set up at the State Bureau of Quality and Technical Supervision. In addition, the State Bureau of Pharmaceutical Supervision, and the Supreme People's Court and Supreme People's Procuratorate have also been asked to take part by taking specific responsibility for day-to-day administration.
The first meeting of the Office of the National Small Group for the Coordination of Fighting Production of Fake Items examined and approved the duty and work system for the Office. The head of the Office of the National Small Group for the Coordination of Fighting Production of Fake Items, Li Chuanliao, directed the meeting.
(Source: Xinhua News Agency)
Strange Patent Tales
A policeman from Liaoning province in Northeast China has applied to patent a modern chastity belt that requires a password to unlock. Zhao Zin, the inventor, has designed a pair of pants with several thin bands that can only be unlocked with a password. Zhao has assured would-be consumers that the pants are fully functional, hindering only adulterous acts. Zhao is so impressed with his invention, and apparently has received such interest from the public, that he has rushed to the State Intellectual Property Office (SIPO) for a patent, lest the idea fall into the hands of chastity belt pirates.
Zhao applied for the patent in July and SIPO is now examining the application. Some have criticized Zhao, claiming that the invention would take society back to the Middle Ages. He has defended his invention in a spirited fashion, pointing out that his customers will not be forced to purchase the pants. One wonders, of course, whether the purchaser and the end user are one and the same individual.
(Source: Agence France Press)
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The China Virtual Intellectual Property Law Newsletter is intended to be used for news purposes only. It should not be taken as comprehensive legal advice, and Lehman, Lee & Xu will not be held responsible for any such reliance on its contents.
