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Coudert Brothers LLPCoudert Brothers LLP
Jingzhou TaoManaging Partner
Coudert Brothers LLP China Practice
ABA Office, Washington, D.C., February 14, 2005
IPR Enforcement in China: Problems and New Legislative
Developments
Coudert Brothers LLPCoudert Brothers LLP 2
IPR Enforcement in China: Problems and New Legislative
Developments
I. Overview of PRC IPR Legislation Reforms since China’s WTO Accession
II. Problems in IPR Enforcement in China
III. The Latest Legislative Developments in PRC IPR Enforcement
Coudert Brothers LLPCoudert Brothers LLP 3
I. Overview of PRC IPR Legislation
Reforms since China’s WTO Accession
Significant Legal Reforms since 2000 Patent Law: Amended on Aug. 25, 2000 and made effective as of July 1,
2001
Trademark Law: Amended on Oct. 27, 2001 and made effective as of Dec. 1, 2001
Copyright Law: Amended on Oct. 27, 2001 and made effective as of Oct. 27, 2001
Regulations on the Protection of Computer Software: Amended on Dec. 20, 2001 and made effective as of Jan. 1, 2002
Regulations on the protection of integrated circuit layout designs: Issued on Apr. 2, 2001 and made effective as of Oct. 1, 2001
Regulations on the Administration of the Import and Export of Technology: Issued on Dec. 10, 2001 and made effective as of Jan. 1, 2002
PRC Regulations on Customs Protection of Intellectual Property Rights: Issued on Dec. 2, 2003 and made effective as of March 1, 2004
Conclusion: a lot of paperwork has been done
Coudert Brothers LLPCoudert Brothers LLP 4
II. Problems in IPR Enforcement in China
A. Rampant Counterfeiting and Piracy
B. Poor Administrative Enforcement
C. Weak Judicial Enforcement
D. Lack of Transparency & Poor Public Awareness
Coudert Brothers LLPCoudert Brothers LLP 5
II. Problems in IPR Enforcement in
China A. Rampant Counterfeiting and Piracy
The U.S. GAO report and the Amcham in China evaluation report reveal certain issues in IPR enforcement
37,489 trademark-related violation cases were handled by AIC in 2003, with the number of trademark infringement and counterfeiting cases accounting for 70.66% of all trademark-related violation cases
6,860 IP cases were handled by PRC courts in 2003 90% of all business software in China at a value of
USD1.5 billion is pirated
B. Poor Administrative Enforcement Weak Enforcement Teams and Poor Coordination Local Protectionism Non-deterrent Administrative Penalty Costly Burden on IPR Owners
Coudert Brothers LLPCoudert Brothers LLP 6
II. Problems in IPR Enforcement in China
C. Weak Judicial Enforcement Inefficient civil proceedings Weak criminal charge to infringers Few infringers receive criminal punishment
D. Lack of Transparency & Poor Public Awareness Lack of transparency Poor public awareness
Coudert Brothers LLPCoudert Brothers LLP 7
III. The Latest Legislative Developments in PRC IPR Enforcement
A. Newly Updated IPR Customs Protection Regulations
B. Newly Issued Judicial Interpretations on the Handling of Criminal IP Cases
Coudert Brothers LLPCoudert Brothers LLP 8
III. The Latest Legislative Developments in PRC IPR
Enforcement A. Newly Updated IPR Customs Protection
Regulations
Favorable Improvements Disadvantages How Does the Customs IPR Protection Regime Work?
Recordal of IP Rights (Patent, Trademark and Copyright) With the GCA
Local Customs' Handling of IPR Infringement Cases
Official Statistics: 5247 IPRS Recorded With the GCA (1995-2005); Multinational Corporations that Made Customs Recordal in China: GM, IBM, P&G, Adidas, Nike, Philip Morris, Pfizer, Sony, Panasonic, etc.
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III. The Latest Legislative Developments in PRC IPR
Enforcement
B. Newly Issued Judicial Interpretations on the Handling of Criminal IP Cases
(Issued on Nov.2, 2004 and Effective as of Dec. 22, 2004)
Chinese legislation on the criminal liabilities of IP crimes: involving four types of IPR infringements and two levels of sanctions
No More Than 3 Years; or No Less Than 3 Years and No More Than 7
Years
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III. The Latest Legislative Developments in PRC IPR
Enforcement
B. Newly Issued Judicial Interpretations on the Handling of IPR Criminal Cases (cont’d.)
Significant provisions in the new interpretations
Considerably lower thresholds for prosecution of IP crimes
Conviction standards for legal entities: 3 times those for individuals under the new
interpretations
5 times those for individuals under the old interpretations
Coudert Brothers LLPCoudert Brothers LLP 11
III. The Latest Legislative Developments in PRC IPR
Enforcement
B. Newly Issued Judicial Interpretations on the Handling of IPR Criminal Cases (cont’d.)
Key terms specified and technical issues resolved “Illegal business volume”/“illegal amount of
sales” “Identical marks”/“use of marks”/“clearly know” “For the purpose of making profit”/“without
authorization of copyright owner”/network copyright infringement
Accomplices and cumulative punishment
Case study: The first IP criminal case in Shanghai City under the new interpretations – two infringers sentenced to 5 and 7 years’ fixed-term imprisonment respectively
Coudert Brothers LLPCoudert Brothers LLP 12
Coudert BrothersCoudert BrothersInternational Lawyers & Solicitors
Beijing22nd FloorBeijing Kerry Centre1 Guang Hua LuBeijing 100020Tel: (8610) 8529-8778Fax: (8610) 8529-8779
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4622
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http://www.coudert.com
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