U.S. Commerce Secretary Tackles IP Rights

U.S. Commerce Secretary Gary Locke told an audience of Chinese government officials and business leaders on Oct. 27 that strong intellectual property rights protection and enforcement was key to supporting entrepreneurs who develop new innovations. Locke also thanked China for taking steps over the past few years to protect IP rights of U.S. and foreign companies operating within its borders.

“While China has made significant strides in its IPR protection, more can and should be done to both entice foreign companies to invest here and to encourage homegrown Chinese entrepreneurship,” Locke said.

Locke’s address was part of his four-day trip to China to co-chair the 20th session of the U.S.-China Joint Commission on Commerce and Trade with United States Trade Representative Ron Kirk and Chinese Vice Premier Wang Qishan.

Karen Dickinson, an international and IP attorney, said respect for intellectual property in China is on the rise, but it will take time for IP legal compliance throughout China to rise to the level of that in the U.S.

“The concept of owning something intangible and protecting it as intellectual property is not part of China’s cultural or legal heritage,” explained Dickinson, a partner at Quarrels & Brady LLP and co-chair of her firm’s China Law group. “That concept began in Europe in the fifteenth century. In fact, Chairman Mao said in 1976 that intellectual property creations are ‘tools for the common good.’"

China did not adopt its first trademark law until 1982 and its first patent law in 1984, Dickinson said. “Consequently, not only is intellectual property law enforcement in China critical for the future, but so are changing cultural norms,” she said. “For example, in contrast to Mao’s statement in 1976, in 2007 Premier Wen Jiabao stated that ‘the competition of the future world…is the competition of IPR.’ And, as Chinese companies have developed their own important brands, products and ideas, the protection of intellectual property has become more accepted as necessary for the success of Chinese businesses, not just U.S. investors in China.”

UPDATE:
As part of an agreement stemming from the JCCT, China agreed to:

Assure that it will impose maximum administrative penalties on Internet infringers and has begun a four-month campaign to clamp down on Internet piracy.
Publish notice conveying to state-run libraries the importance of strengthening protection of copyright-protected academic and medical journals.
Work closely with the United States to resolve U.S. concerns about a new Ministry of Culture circular relating to online music distribution that is creating serious problems for the U.S. music industry.

Instruct its Intellectual Property Working Group to confront next steps on key issues, including China’s further promotion of software legalization of enterprises and exchanges of information on measures for promoting software legalization; China’s establishment of a Broadcast Tariff Rate as soon as possible; and opportunities for interested rights holders and government experts to provide feedback on China’s new Patent Law amendments and new implementing regulations.

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