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You may not do business in China--but your product may be

Bill Heinze has provided a little light plane reading for anyone wrangling IP in China: key conclusions from  the 2005 Report to Congress on China's Compliance released by the United States Trade Representative.

For anyone eschewing work with China because of piracy concerns, other strategic concerns or even moral reasons, reading the status of intellectual property will be cold comfort. The bottom line seems to be that while a judicial framework is emerging, piracy is rampant.  If you create something here, expect it to be sold there, is my takeaway. Here's the first paragraph of Heinze's excerpt:

"Overall, China’s efforts to bring its framework of laws, regulations and implementing rules into compliance with the TRIPS Agreement have been largely satisfactory, although some improvements, particularly in rapidly emerging areas such as Internet copyright protection, are still needed. Enforcement of these measures, however, remained largely ineffective in 2005, giving rise to increasingly strong concerns among U.S. industry. As one trade association representing the information technology sector explained, "[d]espite the Chinese government’s serious effort to begin addressing the piracy of intellectual property, the protection of [intellectual property] remains our industry's chief concern in 2005. Indeed, the appropriation of intellectual property in China has occurred on such a massive scale that it has impacted international prices, disrupted supply chains, changed business models, and probably permanently altered the balance between tangible and intangible values contained within commercial products. U.S. companies have had their [intellectual property] appropriated within China even without engaging with China through exports or investment, and many U.S. companies, particularly in the media and entertainment, see their copied products migrate into mainland markets even while the legitimate product remains barred by regulation."

Posted by Product Team on December 20, 2005 at 09:29 AM | Permalink | Comments (5) | TrackBack (0)


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