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China’s Supreme Court Grappling With IPR

05-28 11:14 Caijing Magazine

China’s highest court is setting legal parameters for intellectual property rights protection while government agencies are busy enforcing existing laws, a top justice official told Caijing in an interview that rebuts U.S. claims against China before the World Trade Organization.

By staff reporter Ye Doudou 

Intellectual Property Court Chief Judge Jiang Zhipei, who doubles as a supreme court commissioner, said China’s laws are enforced through civil and administrative action – not merely criminal procedures, as Washington assumed in its two complaints filed with the WTO in April. 

An ongoing interpretation process by the supreme court is helping clarify IPR laws, Jiang said. More than 20 interpretations since 2001 cover a variety of protection issues including patents, trademarks, copyrights and integrated circuits. The court has released three interpretations so far this year, and two more are expected soon. 

Court interpretations provide a legal foundation for judges handling IPR cases, which have been challenging for the high court, Jiang said. 

At the same time, Jiang said China is committed to more rapid and stronger enforcement measures that increase pressure on counterfeiters. 

In its WTO complaints, the United States charges the Chinese government with setting low punishment standards for counterfeiting. 

For example, according to the latest judicial interpretation published in early April, counterfeiting more than 500 pieces is a crime. The previous threshold was 1,000 pieces. But Washington grumbles that counterfeiters with 499 pieces are exempt from punishment. 

Jiang, however, said the 500-piece limit is just one of several regulations. In cases involving fewer counterfeit pieces, administrative and civil discipline may apply. 

Because China’s IPR laws are mainly a reaction to pressure from abroad, Jiang said China needs a complete protection mechanism. 

Chinese courts already accept many IPR cases from foreign plaintiffs. For example, in 2001, U.S.-based ETS sued New Oriental, a school that prepared students for tests such as TOEFL and LSAT. In a 2005 case, Louis Vuitton and four other famous brands sued a market selling counterfeit goods near Beijing’s embassy row. 

The successful case against the Beijing market prompted foreign media to hail China’s commitment to IPR protection in the run-up to WTO membership. And it gave foreign firms more confidence in the Chinese legal system when dealing with IPR cases, Jiang said. Now, instead of complaining to government administrators, foreign firms tend to file lawsuits in Chinese courts. 

Seven of the top 10 cases published by the supreme court last year involved foreign companies. The cases are considered an important sign of the government’s attitude. 

Jiang said China is sincere about protecting intellectual property rights, not only as a player in globalization, but also because the country wants to be more creative and to attract foreign investors by providing a positive environment for intellectual property. 

 “Please don’t question China’s determination on IPR protection.” Jiang said.

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