VO: By some projections, it is possible within the next five years for China to be the source of supply for more than 35% of the world’s electronics hardware products. Given stories about intellectual property (IP) theft and relaxed IP protection laws in China, this can create some concerns for technology executives doing business with Chinese companies. Can you please explain to our readers five (5) common types of IP infringement your law office comes across most frequently?
Chan: The five common types of IP infringement cases our firm comes across most frequently include trademark infringement; patent infringement, infringement of industrial design, copyright infringement, and trade secret infringement.
Trademark infringement occurs when there is a violation of the exclusive rights of the trademark owner by using a trademark which is identical, or confusingly similar, to the registered trademark in respect to the same or similar type of goods or services and – without authorization from the trademark owner.
Since the Chinese Trademark Office adopts the first-to-file principle, protection arises from the date of filing instead of the date of use of the trademark.
Therefore, we advise technology executives to file an application for their trademark in China as soon as possible if they want to apply the mark to their technological products in China.
Patent and industrial design infringements are also common IP violations in China. Patents protect inventions by giving the owners exclusive rights to use; manufacture, sell, or import the patented invention whereas design registrations protect the appearance of industrial products.
It’s important to keep in mind that relative to ‘novelty’ with regards to patents and design IP in China, the element of novelty is lost once the patent or design is published elsewhere in the world or it is used publicly in China prior to the application date.
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It is therefore necessary for organizations or individuals to keep inventions or designs confidential prior to filing in China.
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Vivien Chan, SBS, BBS, JP Founding and Senior Partner Vivien Chan & Co. |
Technology executives should pay special attention to protecting their software copyrights, too. Similar to trade secrets, which I will discuss later, the owner of an original work can be protected automatically upon the creation of the work and therefore registration of the right is not required. Having said this, copyright records are available in China to preserve the evidence establishing ownership of copyright in China.
Last but not least, trade secrets refer to confidential information which is important to the production of a product and is capable of bringing economic benefits to the owner.
However, it is important to note that reasonable steps to keep the information confidential must be taken in order to claim the information can be defined as ‘trade secrets’. (OEM Exclusive: Request list of EMS/ODM providers anywhere in China or the greater Asia region)
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VO: What are your thoughts on Chinese counterfeiting, particularly with regards to electronics components and, how is Chinese law working to help address the issue and protect the interests of foreign companies?
Chan: Although counterfeiting in China remains an issue, the situation is getting better now since the Chinese government imposed various measures strengthening the protection of IP rights in China against counterfeiting. These include relaxing the requirements necessary to initiate criminal prosecution.
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