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Intellectual Property Protection in China
Foreword

     
Chinese civilization has a long history. The Chinese nation has a vast reservoir of creativity. The brilliant culture created by the Chinese people has exerted a deepgoing influence on the progress of human civilization. Over the past several thousand years, vast numbers of outstanding Chinese scientists, inventors, writers and artists have given the glorious fruits of their mental labour to the development of humanity's common civilization, making enormous contributions.

The intellectual property protection system emerged as a product of the development of human civilization and commodity economy and, in various countries, it has increasingly become an effective legal tool for protecting the interests of the owner of intellectual products, promoting the development of science, technology and the social economy, and allowing international competition. As a whole, China, however, for a variety of historical reasons, began work on its intellectual property rights protection system at a comparatively late date. After China started reform and opening to the outside world, it accelerated the process of establishing an intellectual property rights protection system in order to rapidly develop social productive forces, promote overall social progress, meet the needs of developing a socialist market economy and expedite China's entry into the world economy. Since the end of the 1970s, China has done a tremendous amount of effective work in this field, covering in a little more than a dozen years a distance which took other developed countries scores of years, even a hundred years, establishing a relatively comprehensive legal system for the protection of intellectual property rights, thereby attracting worldwide attention for its achievements not only in establishing the system but also in enforcement.

Today, intellectual property protection is an issue of universal concern in the international political, economic, scientific, technological and cultural exchanges. International bilateral and multilateral negotiations on this topic, especially the reaching of the Agreement on Trade-related Aspects of Intellectual Property Rights in the General Agreement on Tariffs and Trade (GATT), have raised worldwide intellectual property protection to a new level.

In today's world, great importance is attached to intellectual property protection. What is China's specific position regarding this question? What is China's current legislation on intellectual property rights and how is it enforced? What measures has China taken to ensure its international commitment to intellectual property protection? A brief introduction to these issues will prove useful.

I. China's Basic Position Regarding the Protection of Intellectual Property Rights

     
It is the Chinese government's view that the intellectual property protection system plays a significant role in promoting progress in science and technology, enriching culture and developing the economy. It functions both as an important institution ensuring the normal running of the socialist market economy and as one of the basic environments and conditions for conducting international exchange and cooperation in science, technology, economy and culture. China considers the protection of intellectual property an important part of its policy of reform and opening to the outside world and of the building of its socialist legal system. Beginning in the late 1970s, China has been formulating laws and regulations for intellectual property rights protection, and has been participating in activities organized by the relevant international organizations aimed at strengthening international exchange and cooperation in the field of intellectual property rights. From its inception China's intellectual property rights protection system was directed towards the world and geared to high international standards. Spurred on by its reform and opening up, China has carried on its intellectual property protection legislation at a speed never before known.

On March 3, 1980, the Chinese government submitted its application for admission to the World Intellectual Property Organization, and became a member state as of June 3, 1980.

The Trademark Law of the People's Republic of China was adopted at the 24th meeting of the Standing Committee of the Fifth National People's Congress on August 23, 1982, effective March 1, 1983, significantly marking the beginning of the systematic establishment of China's modern legal system for the protection of intellectual property rights.

On March 12, 1984 the fourth meeting of the Standing Committee of the Sixth National People's Congress adopted the Patent Law of the People's Republic of China, effective April 1, 1985.

On December 19, 1984, the Chinese government submitted its instrument of accession to the Paris Convention for the Protection of Industrial Property to the World Intellectual Property Organization and became a member state as of March 19, 1985.

The General Principles of the Civil Law of the People's Republic of China were adopted at the fourth session of the Sixth National People's Congress on April 12, 1986, effective January 1, 1987. In this legislation, intellectual property rights as a whole were clearly defined in China's basic civil law for the first time as the civil rights of citizens and legal persons. This law for the first time affirmed citizens' and legal persons' right of authorship (copyright).

The Chinese government has also worked hard in helping to build up an international environment wherein intellectual property rights in integrated circuits are protected. The World Intellectual Property Organization adopted the Treaty on Intellectual Property in Respect of Integrated Circuit at a diplomatic conference held in Washington D.C. in 1989; China was among the first signatory states.

The Chinese government presented its instrument of accession to the Madrid Agreement for the International Registration of Trademarks to the World Intellectual Property Organization on July 4, 1989, and became a member state as of October 4, 1989.

The Copyright Law of the People's Republic of China was adopted by the 15th meeting of the Seventh National People's Congress Standing Committee on September 7, 1990, effective June 1, 1991.

On July 10, 1992, the Chinese government presented its instrument of accession to the Berne Convention for the Protection of Literary and Artistic Works to the World Intellectual Property Organization and on July 30, 1992 its instrument of accession to the Universal Copyright Convention to UNESCO, becoming a member state of both conventions as of October 15 and October 30, 1992 respectively.

On January 4, 1993, the Chinese government presented its instrument of accession to the Convention for the Protection of Producers of Phonograms Against Unauthorized Duplication of Their Phonograms to the World Intellectual Property Organization, and became a member state as of April 30, 1993.

The Law of the People's Republic of China on Combating Unfair Competition was adopted by the third meeting of the Standing Committee of the Eighth National People's Congress on September 2, 1993, and became effective on December 1 of the same year.

On September 15, 1993, the Chinese government submitted its instrument of accession to the Patent Cooperation Treaty to the World Intellectual Property Organization, becoming a member state as of January 1, 1994. The Patent Office of China is China's agency dealing with cases involving the Patent Cooperation Treaty, performing international patent searches and preliminary examinations.

The above are only part of the records of China's intellectual property legislation and its participation in the activities organized by related international organizations, demonstrating the importance China has attached to intellectual property protection.

The basic framework for China's intellectual property rights protection legal system was completed for the most part in the 1980s. In the 1990s, international economic relations and the international economic environment have already undergone great changes. In November, 1990, multilateral trade negotiations in GATT's Uruguay Round produced a draft Agreement on Trade-related Aspects of Intellectual Property Rights. This signaled that a new international standard of intellectual property rights protection was taking form. The Chinese government actively participated in the negotiations and made unremitting efforts towards their final success. In order to meet the needs of the ever-wider opening up, China has consciously sought to fulfil its international obligations in intellectual property rights protection, endeavouring to bring its intellectual property protection level near the new international standards, and has taken many major measures to further raise its current level of intellectual property rights protection.

The Chinese government's sincerity in its efforts to scrupulously abide by international conventions and bilateral agreements regarding the protection of intellectual property rights, and its capacity to fully implement its international obligations have been appreciated and supported by world opinion. When reviewing the World Intellectual Property Organization's past 20 years of cooperation with China, Dr. Arpad Bogsch, Director-General of the Organization, pointed out that "China had accomplished all this at a speed unmatched in the history of intellectual property protection."

China adheres to the principle in legal system that "there shall be laws to abide by, everyone should abide by the law, the law must be enforced strictly, and those who violate the law must be dealt with." Still, the intellectual property rights protection system has only comparatively recently been introduced in China, and some portion of the population has a rather incomplete understanding of intellectual property rights. In order to better implement this principle, while improving its legal system, enforcing the laws earnestly and striking relentless blows at infringements and other unlawful practices, China has spared no efforts in publicizing and providing education about the intellectual property protection legal system and in accelerating the training of professional personnel in this field. In China the promulgation of every intellectual property law was followed by widespread publicity through the media and distribution of large quantities of educational video-tapes and seperate editions of the law. Mean-while, governments at all levels ran legal knowledge forums and training classes so as to promptly make the relevant law known to all the people. After the revision of the Patent Law, for instance, millions of people throughout China attended such classes, the attendance in Hunan Province alone reaching 600,000 people. The fact that there has been an increasing number of cases involving intellectual property rights in recent years and that these cases have been remedied through recourse to law reflects the people's heightened awareness and the wide spread of intellectual property rights knowledge throughout society. In order to speed up the training of personnel in this field, the Chinese government has, in close cooperation with related international organizations, sent people abroad to study or to attend training classes and seminars. Together with the World Intellectual Property Organization, China has held more than 30 training classes and seminars, with the attendance of over 3,000 people. Programmes in intellectual property rights education and research have also been initiated at over 70 institutions of higher learning throughout the country. In 1986, a teaching and research centre for intellectual property rights was established at the People's University of China, enrolling non-law majors to study for a second degree in intellectual property rights; Beijing University's School of Intellectual Property Rights was founded in 1993 on the basis of the achievements it had attained in teaching and research in this regard. An education system for training professional personnel in this field for their second, Master's or Doctor's degrees has gradually taken form in China, providing the nation with batch after batch of qualified personnel in intellectual property rights protection.

II. China Has a High-Grade Legal System for Intellectual Property Protection

     
Along with its progress in reform and opening up, China has made big strides in intellectual property protection. In accordance with its national conditions and current tendencies in international development, China has formulated and finetuned various laws and regulations on intellectual property protection, thereby constructing a socialist legal system for intellectual property protection with Chinese characteristics. The scope of the intellectual property rights protected in China and the degree of protection afforded have gradually conformed with international practices and the high degree of legal protection for intellectual property rights has been realized.

Effective as of March 1983, the Trademark Law of the People's Republic of China and the rules for its implementation set forth the principles of application, examination and registration in trademark registration procedures which are entirely identical with common international principles. In order to meet the requirements of the reform and opening up and of economic development, to more effectively crack down on trademark counterfeiting and stop acts of infringement, and to conscientiously protect the right to exclusive use of a registered trademark, in 1993 China revised both its Trademark Law and the rules for its implementation to expand the range of trademarks protected. Regulations on commodity trademarks were joined by regulations on the registration and management of service trademarks; in examination as to form, a revision procedure was added, and in examination as to substance, a written comment system was established to provide convenience for registered trademark applicants. All these regulations coincide completely with the requirements of GATT's Agreement on Trade-related Aspects of Intellectual Property Rights. In addition, the State Administration for Industry and Commerce has issued a series of regulations including the Regulations on the Administration of the Printing of Trademarks and the Procedures for Filing License Contracts for the Use of Trademarks. In February 1993, the National People's Congress Standing Committee adopted the Supplementary Regulations on Punishing Criminal Counterfeiting of Registered Trademarks to further intensify punishment for such counterfeiting and other infringements. These laws and regulations fully and effectively guarantee the right to the exclusive use of Chinese and foreign registered trademarks.

The Patent Law of the People's Republic of China and the rules for its implementation came into effect in April 1985, expanding the scope of intellectual property protection in China to include inventions and other new creations. In order to bring the level of China's patent protection closer to international standards, the Standing Committee of the National People's Congress adopted an amendment to the Patent Law on September 4, 1992, which included important revisions. Proceeding from the needs of expanding the opening up and accelerating scientific, technological and economic development, first, the revised Patent Law expands the scope of patent protection: patents may be granted to all types of technological inventions, whether new products or new techniques, including pharmaceutical products and substances obtained by means of a chemical process, foods, beverages and flavourings. Second, an invention patent's duration has been extended from 15 years from the date of application to 20 years; the duration of utility model patents and of exterior design patents has been extended from 5 years from the date of application to 10 years. Third, the protection of patent rights has been further strengthened. In addition to extending the protection of a patented process to include products directly produced by that process, the law clearly stipulates that the importation of patented products requires the permission of the patent holder, thereby giving more effective protection to the rights and interests of patentees. Fourth, conditions for imposing compulsory patent license were re-stipulated. These measures mark the reaching of a new level of patent protection in China. In this way, the Patent Law of China has essentially been brought in line with the GATT Agreement on Trade-related Aspects of Intellectual Property Rights.

The Copyright Law of the People's Republic of China and the rules for its implementation explicitly protect the copyright and other legitimate rights and interests of the authors of literary, artistic and scientific works. The law provides that in addition to protecting the copyright of written works, oral works, music, operas, quyi (folk art forms including ballad singing, story telling, comic dialogues, clapper talks, cross talks, etc), choreography, works of fine arts, photographs, films, TV programmes, video tapes, engineering designs, product designs and their descriptions, maps, sketch maps and other graphic works, China also protects computer software. China is among a select group of countries that have explicitly listed computer software as the object of protection by copyright laws. The State Council has, moreover, promulgated the Regulations on the Protection of Computer Software, providing the specifics whereby the laws protecting computer software will be implemented. These regulations, a necessary adjunct to the Copyright Law, came into effect in October 1991. On September 25, 1992 the State Council promulgated the Regulations on the Implementation of the International Copyright Treaty, providing specific regulations on protecting foreign authors' copyrights in accordance with the international treaty.

These laws and regulations have been joined by the Technological Contract Law of the People's Republic of China and the Law on Scientific and Technological Progress of the People's Republic of China as formulated by the Standing Committee of the National People's Congress, as well as a series of administrative regulations concerning intellectual property protection worked out by the State Council, together further optimizing the nation's legal system for the protection of intellectual property rights, in the whole bringing the system close to and in coordination with international levels of protection.

China has a complete legal system for the protection of intellectual property rights. China's intellectual property law stipulates the legal responsibilities to be borne by anyone who violates the law, including civil liability, criminal liability and exposure to administrative sanctions.

China's Patent Law provides that in the case of infringement arising from the exploitation of a patent without authorization of the patentee, the patentee or other affected parties may request the patent administrative authorities to deal with the matter or may directly file suit in a people's court. In investigating and dealing with the matter, the patent administrative authorities are empowered to order the infringer to stop all acts of infringement and compensate for any losses. Whoever counterfeits a patented product or wrongly appropriates a patented technique will be ordered by the patent administrative authorities to cease all acts of counterfeiting, to provide the public with notification of his or her violation, and to pay a fine. In the case of serious violations, the criminal liability of the person directly responsible shall be investigated through application of relevant articles of the Criminal Law, and if found guilty, the person directly responsible shall be sentenced to fixed-term imprisonment of not more than three years, criminal detention or a fine.

China's trademark laws and regulations stipulate that in the event of infringement on the right to exclusive use of a registered trademark, the administrative department for industry and commerce can, in line with its functions and powers or on the basis of a consumer complaint, examine and deal with the violation on its own initiative. The party whose right has been infringed may also, at the place where the infringer lives or where the act of infringement took place, request an administrative department for industry and commerce at or above the county level to handle the matter. The relevant administrative department for industry and commerce has the right to order the infringer to immediately cease infringement and to compensate the party whose right has been infringed for its losses. If the act of infringement on the right to exclusive use of a registered trademark does not constitute a crime, the administrative department for industry and commerce may still impose a fine on the infringer. If the party concerned wishes to challenge the decision of the administrative department for industry and commerce, it may bring suit in a people's court within a fixed time and the court will render judgement on the case. These regulations provide convenience to the litigants, and, moreover, ensure consistency, impartiality and seriousness in administrative law enforcement and judicial adjudication. In the event of an infringement on the right to exclusive use of a registered trademark, the party whose right has been infringed may also directly bring suit in a people's court. If the counterfeiting of registered trademarks constitutes a crime, the person who committed the act shall be ordered to compensate the party whose right has been infringed for losses suffered and his criminal responsibility shall be investigated and dealt with in accordance with the law. In accordance with the Supplementary Regulations on Punishing Criminal Counterfeiting of Registered Trademarks, in cases where the illegal gains are relatively large or other serious circumstances are involved the counterfeiter of a registered trademark will be sentenced to fixed-term imprisonment of not more than three years or criminal detention, and/or fined; if the illegal gains are very large the counterfeiter shall be sentenced to fixed-term imprisonment of not less than three years and not more than seven years and be fined. If an enterprise or institution is guilty of criminally counterfeiting a registered trademark, the unit will be fined and the criminal liability of the person in charge and other people directly responsible for the counterfeiting shall be investigated and dealt with in accordance with the law. If a government employee knowingly covers up the criminal counterfeiting of a registered trademark or if a person charged with enforcing the law compromises the law for personal gain, his or her criminal malfeasance will be determined by law.

The Copyright Law of China provides that the following acts shall be regarded as infringement: publication of a copyright owner's work without his or her permission, and the unauthorized publication of a cooperative work as the work of a single author; claiming authorship of another person's work without taking part in its creation with the intention of gaining fame or profit; distortion or alteration of another person's works; exploitation of an author's work in any manner without prior permission; the use of another's work without providing the legally stipulated payment; and live broadcast of a performance without the performer's prior permission. In such cases, the infringer shall bear civil responsibility for the cessation of the infringement, for the elimination of any negative effects caused by his actions, for offering a public apology, and for compensation for any losses. Those who plagiarize other people's works, or reproduce and distribute another person's works for their personal benefit without the copyright holder's permission, those who publish a book without the permission of the owner of the publishing right, and those who duplicate and distribute video and audio tapes without getting the permission of the tape manufacturers bear civil responsibility for their actions. The copyright administrative authorities may confiscate their illegal income or impose a fine on them. In the case of a copyright infringement or of violation of other related interests, the party whose rights have been infringed may also directly bring suit in a people's court. With regard to illegal activities that gravely jeopardize the social order or seriously infringe on the legitimate rights and interests of a copyright holder or the holder of other intellectual property rights, in cases where such violations constitute a crime the criminal liability of the infringer shall be investigated and dealt with in accordance with the relevant laws.

With the implementation of intellectual property laws, intellectual property rights are effectively protected in China. These laws are also actively encouraging invention and other forms of creation and fair competition. For instance, the protection of the right to the exclusive use of registered trademarks has resulted in the rapid growth of the number of trademarks registered by Chinese and foreign businessmen in China. By the end of 1993, the number of effective registered trademarks had exceeded 410,000. Of these, 350,000 were domestic, with the remaining 60,000 coming from 67 countries and regions. Companies from the United States, for example, had only 122 trademarks registered in China before 1979; by 1993 that number had soared to 16,221, more than a hundred times the earlier figure. In 1993, there were 170,000 applications for trademark registration annually in China, including more than 130,000 applications for new trademarks registration, among the highest number in the world. In addition, the Patent Law of China has greatly encouraged inventions and other creations in China, and has proved a magnet to patent applications from other countries and regions. On April 1, 1985, the first day the Patent Law came into effect, 3,455 applications for patent rights were submitted. By the end of 1993, the Patent Office of China had handled over 360,000 applications for patent rights. Of those, 27.5 percent were for inventions, 62.8 percent for utility models, and 9.7 percent for exterior designs; domestic applications accounted for 86.4 percent, while 13.6 percent were applications from 70 countries and regions. By the end of 1993, 175,000 patents had been approved, including more than 20,000 invention patents, more than 130,000 utility model patents and over 20,000 exterior design patents.

III. China Has a Complete Law Enforcement System for Intellectual Property Protection

     
China has formulated comprehensive intellectual property rights laws and regulations. Today, it is earnest and fair in executing these laws, and much has been accomplished in this regard.

These great achievements in the execution of the intellectual property rights protection laws and regulations are above all the product of comprehensive judicature and administration provided for in these same laws and regulations.

1. China's judicial institutions for intellectual property protection.

In China, any citizen, legal person or organization entitled to intellectual property rights whose rights and interests have been infringed may bring a lawsuit to the people's court in accordance with the law and receive practical and effective judicial protection.

The people's courts exercise judicial power independently according to law, are subordinate only to the law itself, and are not subject to interference by any administrative organ, public organization or individual.

Earnest execution of the law is the core of the administration of justice. The judicial activities of a people's court are carried out on the basis of facts, and with the law providing the criterion. Cases are tried strictly in accordance with substantive and procedural laws. Cases are heard in an open court, and a collegial system, a challenge system, a system whereby the court of second instance is the court of last instance, and a trial supervision system are practised. Judicial work, in accordance with the law, is also subject to supervision by people's congresses and people's procuratorates at all levels and by the masses, so as to ensure openness, impartiality, and seriousness.

The establishment and fortification of the judicial organs for trying intellectual property rights cases and the optimization of the judicial system are important guarantees for the people's courts correctly to handle such cases and conscientiously to protect intellectual property rights according to law. In recognition of the specialized nature of intellectual property rights cases and the advanced nature of the technology often involved, the higher people's courts in several provinces and municipalities directly under the central government such as Beijing, Shanghai, Guangdong, Fujian and Hainan have since 1992 established such intellectual property rights courts as their actual needs demand. The intermediate people's courts in all the special economic zones as well as Beijing and Shanghai have also established intellectual property rights courts. Intermediate people's courts in the capital cities of other provinces, municipalities and autonomous regions have set up collegial panels specializing in cases involving intellectual property rights protection. In this manner the hearing of intellectual property rights cases is centralized with the advantageous results that unity in executing the law is ensured, experience in dealing with the law is amassed, and the quality of judicature in intellectual property rights cases is strengthened.

With the implementation of China's law on intellectual property protection and the increasing improvement of the judiciary's protective power, people's courts at various levels in China have accepted and decided a large number of civil disputes concerning intellectual property rights. A total of 3,505 cases concerning intellectual property rights disputes were accepted and handled by people's courts throughout the country from 1986 to the end of 1993, 1,168 of which concerned copyrights, 1,783 patents, and 554 trademark rights. The people's courts in accordance with the law defend the legitimate rights and interests of the foreign and domestic intellectual property rights holders through trying cases concerning intellectual property rights disputes. For example, the inventor of a new "technique for sinking piling using drill holes," brought a suit against the Beijing Subway Foundation Engineering Company to determine ownership of the patent on the invention. After trying the case, the Beijing Higher People's Court held that this invention was not a service invention as described by the Patent Law, so the patent right belonged to the inventor and not to his employer. In another example, Hong Kong's Sendon International Co., Ltd. brought suit against Shenzhen's Huada Electronics Co., Ltd. for trademark infringement. After hearing the case, the Shenzhen Intermediate People's Court ruled that the trademark "SENDON" was registered in China mainland by the plaintiff and should be protected by law. The defendant's use of the trademark "SENDON" on the same commodity sold by the plaintiff under that name constituted infringement on the rights to exclusive use of a registered trademark. The court decided that the defendant should pay the plaintiff 468,314.4 yuan in compensation.

Intellectual property rights are important civil rights. In civil infringement cases, the people's court is empowered to order the infringer to bear civil responsibility for the cessation of the infringement, for the elimination of any negative effects caused by his actions, for offering apologies, and for compensation for any losses in accordance with the law. Furthermore, it is empowered to confiscate the infringer's illegal gains and/ or adjudge the infringer to criminal detention or a fine.

If the infringement of intellectual property rights is so serious that it has disrupted the economic order and constitutes a crime, the infringer's criminal responsibility is investigated and dealt with according to law. When a people's procuratorate institutes prosecution for a criminal act of infringement, if the evidence is sufficient to prove that the defendant has counterfeited another's trademark or patent right and the case is so serious as to constitute a crime, the people's court shall promptly and precisely impose punishment in strict accordance with the law. Between 1992 and 1993, people's courts accepted 743 criminal cases for counterfeiting trademarks, of which 731 have been tried with 566 people being sentenced to fixed terms of imprisonment, criminal detention or other punishments. The People's Court of Zhongshan City in Guangdong Province in separate cases imposed fines on five persons directly responsible for counterfeiting the American Mobil Oil Corporation's trademark "MOBIL," further sentencing the defendants to fixed terms of imprisonment from one year to two and a half years. This amply demonstrates that the people's courts of China are resolute in their stand towards punishing criminals and safeguarding intellectual property rights.

According to China's Administrative Procedure Law, if a citizen, legal person or organization wishes to contest a judgement or order of an administrative department for intellectual property protection in a dispute concerning intellectual property rights and to initiate administrative procedure litigation, the people's court shall try the case and shall, in accordance with the law, make a decision to maintain, rescind, or alter it.

When a people's court tries a case arising from intellectual property rights involving foreign nationals, it acts in accordance with Chinese laws and relevant international conventions to which China is a party, adhering to the principle of equity and reciprocity. In this way, the court provides the solid legal guarantees necessary for expanding international economic, technological and cultural exchange and cooperation. The Shenzhen Intermediate People's Court accepted the American E.F. Houghton Company's suit against the Shenzhen Hailian Chemical Co., Ltd. for the latter's trademark violations. Investigation proved the defendant's infringement and held it responsible. The two parties negotiated a settlement through mediation. The defendant promptly stopped its acts of infringement, offered public apology to the plaintiff, and handed over 130,000 yuan as a compensation for the plaintiff's economic loss. The court, in addition, adjudged the defendant a civil sanction fine. Ten days passed from the court's acceptance of the case to its resolution, expeditious remedy much appreciated by the American plaintiff. In acknowledgement of this, the E. F. Houghton Company presented the court with a silk banner reading: "Chinese law is just; judges try cases expeditiously."

Over the past few years, in an effort to raise the level of the administration of justice, the people's courts have adopted a series of potent measures to improve their quality and efficiency in handling cases. In order to amplify their impact, the people's courts have selected typical cases and tried them publicly, conducting information campaigns through the various public media. Undeniable social effects have been achieved through the use of specific cases in the popularization of legal education and the dignity of the socialist legal system has been maintained.

2. Administrative channels for intellectual property protection in China.

In addition to judicature in accordance with international practices, China's system for the protection of intellectual property rights comprises the Patent Law, the Trademark Law, and the Copyright Law and other administrative channels designated in intellectual property laws, all proceeding from China's actual conditions.

Under the Patent Law, the competent authorities in the State Council and local people's governments have the right to establish patent offices. Today, China has more than 50 patent offices established by local governments and more than 20 patent offices established by various ministries and departments under the State Council. The State Copyright Administration and local copyright administrative organs have been established in accordance with the Copyright Law. Trademark administration calls for unified registration of trademarks by the central government and level-by-level administration by the various local governments. Trademark administrative departments under the administrative bureaus for industry and commerce have been established at the central, provincial, city, prefectural and county levels; below the county level, there are administrative offices for industry and commerce. Today, there are well over 7,000 full-time trademark administration personnel throughout China, in addition to 300,000 part-time personnel.

Chinese intellectual property rights administrative departments exercise their legally stipulated powers and functions to safeguard law and order within the field of intellectual property, encourage fair competition, mediate disputes, settle cases involving violations of intellectual property rights, and protect the interests of the broad masses of the people by maintaining a good social and economic environment.

In China the administrative procedures for solving disputes concerning intellectual property rights are simple and convenient. Cases can be quickly filed for official examination and possible prosecution, investigation follows promptly, and efficiency in handling the case is high. This is advantageous to the owners of the rights. The patent administrative organs in China always treat patent violation claims seriously and deal with them without delay in accordance with the law.

Since the Copyright Law was put into force, local administrative organs responsible for copyright affairs investigated and dealt with more than 150 cases involving pirated books and video products from June 1991 to the end of 1993. They have confiscated and destroyed the pirated goods and levied administrative sanctions on the infringers. In 1994, the Chinese government has organized the departments concerned to launch an assault, investigating and dealing with the illegal duplication of laser discs and illegal reproduction of books. In April 1994 in Guangdong Province, the administrative departments in charge of copyrights, cultural affairs, broadcast, film and video-tapes, the administrative departments for industry and commerce, and public security departments took joint action to deal with the illegal duplication of laser discs. Subsequently, Shanghai, Jiangsu and Hunan also took actions to deal with these problems. These measures dealt a heavy blow to the production and selling of pirated products. Over this same period, relevant departments of the Chinese government took steps to strengthen administration over the establishment of enterprises manufacturing compact discs and supervision over their production in accordance with the law.

The Trademark Law of China has been in effect for more than ten years. During this time, the administrative departments for industry and commerce have dealt with 130,000 cases of trademark violation and counterfeiting, including a number of particularly serious cases, e.g. trademark violations or counterfeited trademarks for "Zhonghua" cigarettes, for "Forever," "Phoenix" and "Flying Pigeon" bicycles, for "Guizhou Maotai" wine, and for "Xingkaihe" ginseng. Effective protection was thus given to the lawful rights and interests of the registered trademark owners.

China's intellectual property rights administrative organs, in accordance with Chinese laws and relevant international treaties to which China is a party, adhering to the principle of equal treatment for nationals and non-nationals and reciprocity, give protection to foreigners' intellectual property rights in accordance with the law. For instance, the Zhejiang Provincial Patent Administration Office recently reached a just settlement in a complaint brought by a foreign plaintiff concerning unlicensed production of a cigarette lighter to which he held patent. The competent authorities ordered the factory concerned to cease all acts of infringement and compensate the foreigner for his losses. The State Copyright Administration investigated and then dealt with a series of cases in which a dozen odd arts and crafts factories in Fujian and Guangdong had manufactured pirated toys copying several foreign companies' toy designs, and a case in which an electronics enterprise in Jiangsu was illegally producing compact discs. Administrative departments for industry and commerce have investigated and dealt with 3,000 cases involving the counterfeiting and other violations of such foreign trademarks as TDK, Toshiba, Sony, IBM, 3M, ESSO, P&G, Head & Shoulders, Xiaotiancai, and Philips.

A large proportion of the cases concerning violations of foreigners' intellectual property rights were investigated and dealt with by China's intellectual property protection administrative offices on their own initiative, acting in accordance with their prescribed functions and powers.

China's administrative departments for industry and commerce have undertaken the responsibility of maintaining economic order and can make market investigations on their own initiative so as to effectively protect the rights of the registered trademark owners. Since 1988, administrative organs for industry and commerce at various levels in Guangdong Province have investigated and dealt with 301 cases concerning the violation of US-owned trademarks. Out of these 301 cases, one third were filed by the American trademark owners, with the remaining cases being the product of market investigations by the administrative organs for industry and commerce or consumer complaints. China's intellectual property rights administrative offices are impartial, and firmly safeguard the lawful rights and interests of those who hold such rights. This has earned them praises from many foreign enterprises and joint ventures. Some of these companies presented the administrative departments for industry and commerce silk banners or gilt boards, bearing words of praise such as "Upright and honest, firm as a rock in administering justice," "Impartiality in enforcing the law, support right, eliminate wrong," "Just settlement, protection of commerce," "Strict and impartial justice, conquerer of fakes and frauds," and "Strict and impartial in executing the law, consummate impartiality." They praised the personnel handling the cases as "conscientious in work and resolute in action," "Such speed in handling a case is seldom encountered anywhere in the world," etc.

Concluding Remarks

     
As China implements its reform and opening to the outside world, it is changing with each passing day. Today more than a few international observers have come to the conclusion that in terms of intellectual property protection China has reached international advanced levels. China's backwardness in its intellectual property system is now a thing of the past.

However, there remain some naysayers in the world seemingly willfully blind to China's development and transformation who incognizant of present realities pass improper judgements on the nation's current situation regarding intellectual property protection. They allege that China has not yet established a "full and effective intellectual property system," and that China "lacks the ability to undertake international obligations." Such unfounded opinions do not bear argument; the truth speaks for itself.

Nonetheless, China cannot remain satisfied with the achievements it has already made. China is a developing country and still has much work towards optimizing its intellectual property system. This system in its modern form was established only a short time ago, and as a result, awareness of intellectual property rights remains underdeveloped in society at large. In some regions and in some governmental departments there is insufficient appreciation of the importance of intellectual property protection. Some serious acts of infringement have violated not only the legitimate rights and interests of the holder of the intellectual property right, but also the dignity of the law. Accordingly, even as the nation continues to otherwise improve the intellectual property legal system, the State Council has drawn up Decisions on Further Strengthening the Protection of Intellectual Property. China is confident that the implementation of all the important measures contained in the Decisions will mark a great new step forward in the nation's efforts to ensure the protection of intellectual property rights.

China will continue actively to promote international cooperation in the field of intellectual property. China itself has received active assistance from the World Intellectual Property Organization and from others working in the field in establishing and fine-tuning its intellectual property rights protection system. The nation will, as in the past, actively join in the activities of relevant international organizations and fulfil the obligations described in the international intellectual property treaties and agreements. Operating on the basis of the Five Principles of Peaceful Coexistence and in accordance with the principle of equality and mutual benefit, China will continue to cooperate with the rest of the world's nations, working and making positive contributions towards the development and optimization of the international intellectual property system.

Information Office State Council Of the People's Republic of China
June 1994, Beijing
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