CHINA INTELLECTUAL PROPERTY LAW NEWSLETTER
Vol. 2 , No. 14 - October 24, 2001
TOPICS THIS ISSUE:
- Rolex Wins Rights to Rolex.com.cn
- Chinese Chip First Step in Burgeoning CPU Industry
- Regulating Judgments of Patent Infringement in China
- Microsoft Hard Hit by Piracy, But Still Confident about Chinese Market
- Foreign Brands Enjoying Popularity in China
- Ethics Code Issued for Judges
Rolex Wins Rights to Rolex.com.cn
The well-known Geneva-based watch maker Rolex has successfully prevented a Chinese Internet business from using the national form of the domain name rolex.com.
An official with the People's Intermediate Court in Beijing, said the court decided that CINET, a local Internet service provider, did not have rights to the rolex.com.cn web address. He said that "Rolex is a famous brand in China, and it was decided that CINET had no claim to use the domain name."
Both parties have an opportunity to appeal the decision, which included the verdict that Rolex should receive RMB 10,000 from CINET in compensation for damages.
(Source: AFX - Asia)
Chinese Chip First Step in Burgeoning CPU Industry
It was recently announced in China that scientists have developed the first entirely Chinese high-performance central processing unit (CPU) "Godson" chip.
Jiang Mianheng, vice-president of the Chinese Academy of Sciences praised the recent development as a technological breakthrough as the chip and the intellectual property used to design it is completely Chinese. It is hoped that this will accelerate the development of the national IT industry and ensure the security of the State information system. Moreover, the high foreign licensing fees that local manufacturers have been forced to pay will presumably be a huge boost to future Chinese chip makers.
Tang Zhimin, the professor who led a team of experts in the research and development needed to build the chip said that future plans for the chip include developing an equivalent of the present "Pentium II" within one year, using it to make high-performance servers to be used on computer networks in two or three years, and incorporating it into desktop personal computers in five years.
Although the Godson chip is similar to the 486 chip used in older personal computers, Tang said it can still be improved in performance. He also noted that in the past "people thought it was difficult to develop CPU chips, but we made it by investing RMB 10 million (US $1,209,687) and this has greatly encouraged our IT researchers."
(Source: People's Daily)
Regulating Judgments of Patent Infringement in China
China has documented regulations for the first time concerning the judgments of patent infringement, said Wang Zhenqing, Vice President of the Beijing Municipal Higher People's Court.
On October 10 at a working conference, he noted that a committee of the Beijing Court had discussed the "Suggestions on the Judgments of Patent Infringement (for trial implementation)", and will implement it October 10.
Wang noted that the "Suggestions on the Judgments of Patent Infringement (for trial implementation)" has 129 articles involving various fields of patent infringement judgments.
Statistics showed that since the Patent Law was implemented in 1985, marking the establishment of China's patent system, the Beijing Court had received 773 patent cases during the first five years.
(Source: Xinhua News Agency)
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Microsoft Hard Hit by Piracy, But Still Confident about Chinese Market
Microsoft Corporation is positive of sales prospects in China, in spite of the fact that 94 of every 100 Microsoft programs used in China are pirated and create no revenue.
Microsoft China president, Jack Gao, recently said that as an industry leader, they suffer especially heavy in China because of the rampant piracy plus the enormous popularity of the Microsoft software.
Microsoft Office 2000 operating system was even withdrawn from shelves on October 8 due to the piracy problem. However, as plans materialize to market the newer program Office XP, Gao says "we remain optimistic."
The Business Software Alliance, a group of software makers and researchers, marks China's 94% piracy rate second in the world, only slightly behind Vietnam's 97% rate. The group also estimated that the losses suffered only in China for the year 2000 due to software piracy were approximately US $1.12 billion, a sharp increase from the US $645 million lost in 1999.
Gao believes the situation is turning around in China as the government, which is now in the process of creating new "computer software protection regulations" to be implemented within one year, is becoming more concerned with the need to protect intellectual property, enforce current laws, and implement new ones. "There has been an incredible recognition and support by government leaders on protecting the value of intangible assets, but it is a huge challenge and will take time," he admitted.
However, sources within the software industry have suspected the government, which last year forced institutions to allocate budgets for legitimate software purchases, of ignoring the high rate of piracy in order to stimulate consumer spending on personal computers and video disc players.
Studies show that over 10 million computer units will be sold in China this year, but Gao said that whereas consumers in the developed world will spend 40 cents on software for every dollar spent on hardware, Chinese consumers will only spend 10 cents per dollar. Even tourists in China are frequent buyers of pirated software, video movies and digital movies that are a fraction of the price sold in legitimate stores.
Although Gao said that "from the revenue point of view we are still on the smaller side compared to Taiwan and Hong Kong," the company has a new building in north Beijing's and employs 900 employees.
Microsoft's sales revenues grew by 250 percent last year, much of it consisting of licensed sales of the Windows Operating System to computer vendors in China, who package it with a new personal computer.
Notwithstanding the incredibly low absolute sales figures, studies show that Windows is installed in 90% of China's personal computers.
However, Gao, taking the long term implications of the industry into view, realizes that it will take time before individual sales of Microsoft products increase. He noted that the regulation of piracy in China is not only necessary for foreign software firms, but also a matter of life and death for national software firms as China needs its own indigenous software industry.
(Source: Agence France Presse)
Foreign Brands Enjoying Popularity in China
The enthusiasm with which Chinese nationals purchase foreign goods at the Wal-mart Shenzhen branch, in the south province of Guangzhou is symbolic of the zeal with which both consumers and manufacturers approach the market in China.
It is quite easy to see the increasing popularity of foreign products in China. When asked about his buying habits, Zhong, a 30-something white-collar worker, says "if they aren't too expensive, we try to buy as many imported products as possible. The quality is much more reliable than domestic brands."
As China bids farewell to leaders from over 20 Asia-Pacific countries, the Chinese masses are choosing well-known brand names such as Tide, Kellogg's, McCormicks, Starbucks and Motorola.
Although many investors are excited about entering the largest and fastest-growing country in the world, some firms are still cautious as they realize money is hard to earn in China. The vast majority of Chinese people still do not have enough money to buy foreign products. Furthermore, analysts predict that even after China's entry into the WTO, the communist government will still regulate the economy and practice favoritism, hampering the transition to a market economy.
With over US $32 billion of direct investment in the first three quarters of this year alone, China has already become the largest market for motorcycles, mobile phones, soybeans, air conditioners, elevators and light bulbs. This year it became the second largest market for personal computers and is expected to become the largest market for beer in 3 years. Chainstores such as KFC, McDonalds and Kodak, have hundreds of outlets nationwide. Last year, China became Kodak's second largest market.
However, counterfeiting is still a major concern for many MNCs. In many local markets throughout China, such as "Silk Alley" just behind the U.S. Embassy in Beijing, genuine products are the exception to the thousands of counterfeit Nike shoes, North Face Jackets and Calvin Klein undergarments. Although 11 million motorcycles were sold in China last year, Japanese manufacturers estimate that 50 to 70 percent of the "Yamahas" and "Hondas" on the street are in fact counterfeits illegitimately built in Chinese factories.
In Shanghai, at the APEC conference, U.S. trade officials and chief executives passed off these problems as kinks that would be worked out within time.
(Source: The Washington Post)
Ethics Code Issued for Judges
The Supreme People's Court of China has issued a list of professional ethics for judges to follow.
The Chinese Judges' Professional Ethics Principles aims at strengthening the courts' discipline and improving judicial justice by ordering courts at all levels to improve judges' self-discipline and efficiency.
The principles contain six basic codes of conduct for judges, including improvement of judicial justice, acceleration of working efficiency, honesty, judicial management and self-improvement.
"Justice and efficiency are the lifeline of the judicial system,'' Cao Jianming, vice-president of the China Supreme People's Court, said in a press conference last Thursday, "A healthy judicial system is predicated on the contingent of honest, upright and professional judges.''
One rule states that judges are not allowed to have any contact with parties involved in a lawsuit. Another regulation rules that judges do not have the right to voice personal opinions on a lawsuit until a judgment has been made. The principles also add that as the independent judicial right of judges cannot be violated, judges do not have the right to question lawsuit procedures and related information regarding other cases. Any discriminating language is also banned from the court.
The principles state that good judicial manners will improve the image of judicial departments and will better serve the people as in recent years, some residents have complained about judges being corrupt.
Cao said that the new rules were issued after more than a year of research, with ideas borrowed from similar rules in foreign countries.
All courts across the country are being urged to provide professional ethics training to judges and law enforcement specialists.
It is thought that the new rules will help the Chinese judicial system meet with international standards and face the challenges of the country's entry into the World Trade Organization (WTO) when more lawsuits involving foreign parties will emerge.
(Source: China Daily)
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