CHINA INTELLECTUAL PROPERTY LAW NEWSLETTER
Vol. 4 , No.8 - June 3, 2003
TOPICS THIS ISSUE:
- 70 Percent Of Wine Sold In Mainland China's Cities Fake
- China's Customs At Various Levels Have Strengthened The Protection Of Intellectual Property Rights (Ipr)
- Patents Crucial To Scientific Projects
- Legal Dispute Erupts Over Name Of Shaanxi Radio Station
- Shanghai Automotive Industry Corporation Denies Violating Intellectual Property Rights
- Honda Wins Copyright Suit In China
- Careful Study For Thai Companies' Forays In China
70 Percent Of Wine Sold In Mainland China's Cities Fake
A recent survey conducted by the China National Administration for Industry and Commerce in Beijing, Shenyang, Zhengzhou and Chengdu revealed that 70% or more of the "imported" wine sold in restaurants and hotels in the four cities is fake. The administration found that some of the restaurants or hotels store the cheap wine in fancy imported bottles to pass off as the genuine product.
The administration inspected about 50 hotels and restaurants in the four cities and found that only 28.6% of the wine sold is genuine. According to the administration, the quality of fake wine was getting better and becoming more difficult to differentiate.
In an effort to stamp out the trade, the administration has launched a crackdown on agents and dealers.
Eighteen months after its entry into the World Trade Organization, China remains a counterfeit paradise, awash with a huge range of copied industrial products and brands, local or foreign.
(Source: The China Post)
China's Customs At Various Levels Have Strengthened The Protection Of Intellectual Property Rights (Ipr)
In 2002, China's customs investigated a total of 573 IPR violation cases which are worth RMB95.62 million. The number of cases of imports or exports violating trademark rights reached 557, accounting for 97.2% of the total, with a gross value of RMB90.57 million.
General Administration of Customs revealed that there were 569 exports IPR violation cases, accounting for 99.3% of the total. The violated trademarks include international name brands such as FIFA WORLD CUP, ADIDAS and PUMA, as well as famous domestic trademarks such as ANCHOR and TRI-CIRCLE.
Besides textile and clothing violation cases, which were rampant in the past, cases involving new types of products such as footballs and watches also increased. At present, China's customs have extended IPR protection to more categories of products. In addition to name brand such as NIKE and ADIDAS, they also added many new brands.
(Source: SinoCast China Business Daily News)
Patents Crucial To Scientific Projects
Research institutes and technological firms must have a complete system for intellectual property rights to undertake nationally important scientific projects.
The Ministry of Science and Technology released a regulation entitled "The Regulation of Enhancing Intellectual Property Protection on National Scientific Programs " that aims to encourage and safeguard technological innovations. It also targets greater acceleration of the commercialization of new technology. Research institutes and technological firms should have special departments, staff and funds for intellectual property protection when undertaking new scientific projects.
The regulation requires research institutes to investigate patented domestic and overseas technological projects to avoid duplication. Furthermore, they must stop or readjust scientific plans if their targeted research projects have been patented by any domestic or overseas institutes.
According to the sources from the said Ministry, in the past, some academic institutes carried out projects that duplicated work elsewhere due to their ignorance of intellectual property protection.
Research institutes that undertake large scientific projects of international importance will receive government subsidies when applying for patents in foreign countries.
Researchers are also required to take part in training courses focusing on intellectual property rights before they begin technological projects.
According to reports, State-owned firms and academic institutes lacked awareness of intellectual property protection for many years.
The vice-commissioner of the State Intellectual Property Office, Tian Lipu, said that many academic institutes still place too much effort on publishing academic papers of new technologies instead of applying for patent protection and commercializing their research results. Domestic companies still concentrate on low-level patent applications, such as traditional Chinese medicine, soft drinks and food. Tian opined that they should make greater efforts to develop patented technologies in such fields as optics, information technology, wireless transmission and mobile communications.
China implemented the Patent Law in 1985 and the State Intellectual Property Office (SIPO) has received more than 1.62 million patent applications since then. According to the latest SIPO statistics, domestic applications account for 83% while foreign ones comprise 17%.
A total of 116 countries or regions have registered patent protection applications in China, in which Japan applied for the most patents in China last year.
(Source: China Daily)
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Legal Dispute Erupts Over Name Of Shaanxi Radio Station
Shaanxi People's Broadcasting Station and US publishing group Times are engaged in a landmark intellectual property rights dispute over the right to use the name "Fortune".
The US company accused the Shaanxi station's Fortune program and logo of infringing upon the US company's Fortune trademarks, which have been registered in China.
The State Industrial and Commercial Administration Bureau revealed in a notice that the US company has applied to the State Industrial and Commercial Administration Bureau for a judgment on the trademarks.
The 73-year-old Fortune magazine is published by the US Times Company, and is an authoritative magazine in global financial and economic circles. Each year its Fortune Forum of the world's top 500 enterprises attracts wide attention.
The Fortune program of the Shaanxi People's Broadcasting Station was launched in 2000. According to the director of the Shaanxi People's Broadcasting Station, they have duly registered the trademarks with the State Industrial and Commercial Administration Bureau. The station claimed that they were the first to use "Fortune" as the registered trademark of the broadcasting program then followed by other TV and radio broadcasting programs.
The argument from the Shaanxi People's Broadcasting Station that the radio program Fortune does not infringe the trademarks of the US Fortune is that the name and logo of the Fortune radio program are very different from the magazine Fortune and in Shaanxi a large number of local people know of the radio program, while only a few readers know of the magazine.
Moreover, the manner Shaanxi Fortune and the US Fortune carry out their services are also different. The Fortune program uses radio and the US magazine and net service use computers, video and software.
The dispute over the Fortune trademarks is the first battle over intellectual property between a Chinese institution and a US business after China's entry into the World Trade Organization in late 2001, making it a landmark case for the country.
(Source: China Daily)
Shanghai Automotive Industry Corporation Denies Violating Intellectual Property Rights
Shanghai Automotive Industry Corporation-Chery, the company's car-making operation, has denied reports that it has violated intellectual property rights in the design of its new QQ sedan. The company denied reports in the Shanghai Economic Times that it had violated the intellectual property rights of a foreign multinational automaker based in China following the unveiling of the model at the Shanghai Motor Show. The QQ is to be launched soon on the Chinese market priced at RMB50,000/- (US$6,000).
Meanwhile, car sales have been boosted by Chinese consumers' fears over using public transport following the outbreak of the Severe Acute Respiratory Syndrome (SARS) virus in China over the first four months of the year. Shanghai Automotive Industry Corporation has raised its car production forecast by almost 9% for 2003 following its healthy first four-month performance. Shanghai Automotive Industry Corporation is expecting to produce 500,000 cars this year, up by 22% from a previous forecast of 460,000 units.
(Source: World Market Analysis)
Honda Wins Copyright Suit In China
Honda Motor Co has won a copyright suit in China as a Beijing court threw out a lower court decision which rejected Honda's claim that Chinese manufacturers illegally copied its scooter design.
The ruling ended Honda's legal battle over the design of its scooter as China adopts a two-stage trial system on cases involving intellectual property rights such as patents and copyright.
(Source: Japan Today)
Careful Study For Thai Companies' Forays In China
A trade specialist advised companies in Thailand that are interested in the Chinese market to study local regulations and prepare detailed business plans prior to entering the market.
According to Winson Fung, Asia sales manager of Global Sources Ltd, there is a lot potential in the country with a population of 1.3 billion as Chinese people preferred to buy foreign goods and the reforms of the new government had created a favorable environment for investment. However, it is important to note that China has many complicated local laws and regulations and there are also many violations of intellectual property rights.
Thai products that have good potential in the Chinese market included food, automobile parts and traditional massage items. Fung advised that Thai franchisors setting up in China should immediately register necessary trademarks for all of their products and hire certified local law specialists and accountants to assist in recruiting franchisees.
Another suggestion is that Thai franchisors have a short-term, medium-term and long-term business plan. The short-term plan should span the first two years and be directed towards finding a main franchisee to help expand franchises. The intermediate plan should be for five years and focus on finding a local partner or granting distribution rights to a local firm. The long-term plan should be for ten years and involve establishing relationships with local officials to avoid operating risks.
According to the expert, companies should always promote themselves regularly to the public by participating in trade fairs.
(Source: Bangkok Post)
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The China 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.
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