China recently announced that it was seeking to improve protection for and enforcement of intellectual property rights. As China is one of New Zealand’s top trading partners, it will be of interest to see how these improvements develop.
China’s History of IP
As little as ten years ago, many companies were wary of moving into China because of the perceived and actual challenges of enforcing their IP as well as losses from IP theft. Despite the attractions of relatively cheap manufacturing and a massive potential market, the costs associated with a lack of appropriate IP enforcement meant that many players felt the benefits were not worth the effort.
China has been implementing new IP laws since the 1980s, and much has changed over the last decade as a result of a deliberate effort by the Chinese government. Chinese companies are now recognising the value of IP and the importance of respecting the IP of others – something that is vital for the current global model to work.
In November 2019, China enacted a new law aimed at addressing the registration of trade marks made in bad faith. It is also seeking to accelerate the implementation of previous announced measures for punitive damages for the infringement of patents and copyright.
The recently announced improvements further build on this.
China is intending to address a number of issues that have previously affected effective enforcement of intellectual property rights. Such issues include low compensation, high costs and difficulties of proof.
Notably two key areas are highlighted:
- Exploring how to lower the threshold for what constitutes IP infringement in the first place
- Increased penalties for offenders
Having confidence in one’s IP and the ability to effectively enforce it is key to investment and business growth.
These developments should be welcomed and their progress followed with interest.
Brown T. (2019, November 25). “Five things to know about China’s promised crackdown on intellectual-property theft”. Retrieved November 28, 2019, from: https://www.marketwatch.com/story/five-things-to-know-about-chinas-promised-crackdown-on-intellectual-property-theft-2019-11-25
Harney A. (2019, November 25). “China plans stronger protections for intellectual property rights”. Retrieved November 27, 2019, from: https://www.reuters.com/article/us-china-ip/china-plans-stronger-protections-for-intellectual-property-rights-idUSKBN1XY0A5
New Zealand Now. (2018, March 15). “Economic overview”. Retrieved November 28, 2019, from: https://www.newzealandnow.govt.nz/investing-in-nz/economic-overview
NZ Business. (2018, June 19). “The Rise of IP in China”. Retrieved November 28, 2019, from: https://nzbusiness.co.nz/article/rise-ip-china
O’Neill R. (2019, November 26). “China vows to lower threshold for IP infringement”. Retrieved November 28, 2019, from: https://www.worldipreview.com/news/china-vows-to-lower-threshold-for-ip-infringement-18946
Weightman W. (2019, November 06). “China’s IP System was Improving Even Before the Trade War”. Retrieved November 28, 2019, from: https://www.chinabusinessreview.com/chinas-ip-system-was-improving-even-before-the-trade-war/
Workman D. (2019, February 04). “New Zealand’s Top Trading Partners”. Retrieved November 28, 2019, from: http://www.worldstopexports.com/new-zealands-top-trade-partners/