One of the priority issues in the 115 page 2008 Report to Congress On China’s WTO Compliance, released by the United States Trade Representative (USTR) in December is, unsurprisingly, the protection and enforcement of intellectual property rights in China. Below you will find a selection of the USTR report which shows where China has room for improvement:
Pg 76. “The United States also remains concerned about a variety of weaknesses in China’s legal framework that do not effectively deter, and may even encourage, certain types of infringing activity, such as “squatting” of foreign company names, designs and trademarks, the theft of trade secrets, the registration of other companies’ trademarks as design patents and vice versa, the use of falsified or misleading license documents or company documentation to creat the appearance of legitimacy in counterfeiting operations, and false indications of geographic origin of products.“
Pg 76. “The United States has urged China to provide greater protection against unfair commercial use of undisclosed test and other data submitted by foreign pharmaceuticals companies seeking marketing approval for their products. The United States has also encouraged China to undertake a more robust system of patent linkage and to consider the adoption of a system of patent term restoration. In addition, built-in delays in China’s marketing approval system for pharmaceuticals continue to create incentives for counterfeiting, as does China’s inadequate regulatory oversight of the production of active pharmaceutical ingredients by domestic chemical manufacturers.“
Conform the conclusion of my thesis, the USTR points to some extra-judicial factors that influence the enforcement of IPR negatively:
Pg 77. “IPR enforcement is hampered by lack of coordination among Chinese government ministries and agencies, lack of training, resource constraints, lack of transparency in the enforcement process and its outcomes, and local protectionism and corruption.“
Pg. 77. “Trade in pirated optical discs continues to thrive, supplied by both licensed and unlicensed factories and by smugglers. Small retail shops continue to be the major commercial outlets for pirated movies and music (and a variety of counterfeit goods). Piracy of books and journals and end user piracy of business software also remain key concerns, although improvements have been seen in business software piracy rates, as discussed above. In addition, Internet piracy is increasing, as is piracy over enclosed networks such as universities.“
Pg. 77. “…right holders have monitored China’s efforts and report little meaningful improvement in piracy of pre-release titles in several major cities.“
Appendix 3 shows a fact sheet of the 18th US-China Commission on Commerce and Trade Meeting, December 11, 2007, was given:
It states about Intellectual Property Rights:
- China reported on steps it has taken since the previous JCCT meeting in April 2006 to improve protection of intellectual property rights in China, including accession to the WIPO internet treaties, a crackdown on the sale of computers not pre-loaded with legitimate software, enforcement efforts against counterfeit textbooks and treaching materials, and joint enforcement raids conduct by the Federal Bureau of Investigation and Chinese security agencies.
- China and the United States agreed to exchange information on customs seizures of counterfeit goods in order to further focus China’s enforcement resources on companies exporting such goods.
- China agreed to strenghten enforcement of laws against company name misuse, a practice in which some Chinese companies have registered legitimate US trademarks and trade names without legal authority to do so. The two sides also agreed to cooperate on case-by-case enforcement against such company name misuse.
Appendix 4 shows a fact sheet of the 19th US-China Joint Commission on Commerce and Trade Meeting, September 16, 2008.
It states about Intellectual Property Rights:
- China and the United States noted the importance of ongoing dialogue and cooperative efforts taking place under the JCCT IPR Working Group, which met September 4-5 in Beijing, and agreed to hold regular meetings of the IPR Working Group in the future.
- China and the United States agreed to continue pursuing cooperative activities in addition to formal meetings of the IPR Working Group, on such issues as: IPR and innovation, including China’s development of guidelines on IPR and standards; public-private discussions on copyright and internet piracy challenges, including infringement on user-generated content sites; reducing the sale of pirated and counterfeit goods at wholesale and retail markets; and other issues of mutual interest.
- China and the United States welcomed plans to conduct further cooperative meetings between responsible officials regarding: China’s patent law amendments now under consideration in the National People’s Congress; pharmaceutical data protection; and the Memorandum of Cooperation on Strenghened Cooperation in Border Enforcement of Intellectual Property Rights.
- China and the United States agreed to sign two IPR memoranda of understanding (MOUs) on strategic cooperation to improve the administration and effectiveness of copyright and trademark protection and enforcement, as soon as possible but no later than the end of 2008. The MOUs will be signed between the US Patent and Trademark Office, the US Copyright Office, China’s National Copyright Administration and the State Administration for Industry and Commerce.
