Encouraging signs for improved enforceability of intellectual property in China

Saturday 9th January 2010

As international trade barriers have fallen, China has come under increasing pressure from the US and EU to provide stronger, more enforceable IP protection to ensure all countries are competing on a more level playing field.  Recent decisions show that progress has been made across various forms of IP.

At the beginning of the year, a German bus maker was awarded US$3million after a Chinese company was found to have copied the design of their Starliner bus.  Images of the Starliner and the strikingly similar Zonda copy are provided here.

This was followed by a successful action by Microsoft against a software piracy syndicate which ran on the tomatolei.com website.  The website offered free downloads of illegal software, a  problem which is rife since the majority of operating systems in China are illegal copies.  While the decision has made some impact, there were still bootlegged copies of Windows 7 available ahead of the official release.

Not all decisions have been in favour of non-Chinese companies and it is clear that Chinese companies are adapting to operating in a more openly commercial environment.  Recently, Microsoft was found to have breached a licensing agreement with a Chinese company, Zhongyi Electronic, covering Chinese character fonts.  Zhongyi Electronic successfully argued that the licence was limited to use of the add-on with Windows 95 and that inclusion of the fonts in later versions of Windows was not covered by the agreement.

China still has a way to go, but the signals are positive that IP is being taken seriously.  This is only likely to continue as China moves from being a technology importer to a more innovation-based economy. 

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