US Chinese copyright complaint at WTO- right or wrong?

[rose~]

http://news.bbc.co.uk/1/hi/business/6539947.stm

http://www.ustr.gov/Document_Library/Press_Releases/2007/April/United_States_Files_WTO_Cases_Against_China_Over_Deficiencies_in_Chinas_Intellectual_Property_Rights_Laws_Market_Access_Barr.html Office of the US trade rep

The US is set to file a complaint about China to the WTO regarding its failure to enforce intellectual property legislation.

According to some, copyright infringment is an uncontrollable worldwide problem which China is doing its utmost to control, and that it is unfair to single out China alone.

On the other hand, perhaps the U.S. government is justified in its accusations that "Inadequate protection of intellectual property rights in China costs US firms and workers billions of dollars each year."

According to the US trade link above, China has already taken steps by passing a judicial judgement regarding the extent of criminal liability related to IPR. Is that a sign of acquiescence or merely appeasement on the part of the Chinese government?

Personally, I think there is very effective police/CCP control of other matters, for example 100% effectiveness on blocking media such as the BBC news and Wikipedia, so it seems hard to believe that websites offering illegal downloads and DVD vendors could not be controlled.

P.S. I really dislike the use of "active steps" on the US trade website ("We acknowledge that China’s leadership has ...taken active steps to improve IPR protection and enforcement."), I mean what other kind of steps would they be taking? Passive steps? Oh well, at least they didn't say the horrible "proactive".

(I copied the idea for a poll from another website ).

Edit:

-Apparently the judicial interpretation mentioned above refers a lowering of the threshold of the amout of pirated DVDs which may be held from 1000 to 500 (see link below), although the same document also mentions that the value of the goods may be defined in other terms (such as value or profit). To me this is fascinating as I always wondered how those DVD stores were managing to survive. Another loophole larger than Jiang Zemin's glasses which is mentioned in that link means there is no copyright protection for goods awaiting censorship review! I was waiting for someone else to vote, but now I will vote "yes".

WTO Case Challenging Weaknesses in

China’s Legal Regime for Protection and Enforcement

of Copyrights and Trademarks PDF

[gato]

http://www.thehindubusinessline.com/2003/03/20/stories/2003032000950600.htm

Motion picture body cracks down on DVD piracy

Rina Chandran

Thursday, Mar 20, 2003

It is estimated that about 60 per cent of DVDs in India are pirated, leading to a loss of $75 million, according to the MPA. "Pirated DVDs are not such a big problem in India yet, so this is our proactive effort to stop it before it becomes a problem," said Mr Ellis, who is based in Hong Kong and has led the anti-piracy programme since 1999, overseeing raids, investigations and legal actions.

In India, which makes an average of 800 films a year, only two out of ten movies make profits, and that too, from the domestic market, as compared with Hollywood, where four out of ten movies make profits from the international release, Mr Ellis said.

Besides, the home video market accounts for a very small per cent of revenues here. "So it is very important to protect the theatrical release to maximise the commercial success," said Mr Ellis, pointing to the example of Hong Kong, where rigorous anti-piracy efforts supported by the government gave a major fillip to the local film industry. "We want to work with the Indian film industry, share our experiences, and come up with a formula to deal with piracy and copyright issues."

It's interesting to compare the extent of piracy in India versus China. India, on a per capita basis, is poorer than China, yet according to article above, 40% of DVD in India are legitimate. I'm sure the ratio for China is much, much lower -- even 1% might be a stretch. India has a very large film and music industry, and it seems the India government has done quite a bit to fight piracy.

Here is a speech by a US State department official on intellectual property protection in India.

http://usinfo.state.gov/ei/Archive/2003/Dec/31-858428.html

Larson Urges India to Improve Protections of Intellectual Property

There are also examples of regions in India that have effectively increased IPR protection. In Chennai, where there is a separate Deputy Police Commissioner who deals with Copyright infringement, industry reports a steep decline in film and music piracy in that city. This success could be repeated in other regions throughout India provide government and industry cooperate in dedicating sufficient resources and to making IPR enforcement work.

There are also some impressive private sector initiatives. Reports from the music industry indicate that piracy levels in India have decreased from over 80% in the 1980 to approximately 30% today.

But this figure is still too high, and India is the world's third largest pirate market in volume and sixth in value. It is encouraging that two music industry associations have been working actively with law enforcement authorities to identify manufacturers who deal in pirated music. They have also assisted the police in conducting raids and helping identify pirated cassettes & CDs.

[Hero Doug]

According to some, copyright infringment is an uncontrollable worldwide problem which China is doing its utmost to control, and that it is unfair to single out China alone.

I think it's only unfiar if other's are just as bad as China. As gato has posted even poorer countries can control this, this makes it hard for China to argue on a financial basis.

On the other hand, perhaps the U.S. government is justified in its accusations that "Inadequate protection of intellectual property rights in China costs US firms and workers billions of dollars each year."

How can it not be costing (not just the U.S. companies) billions and billions.

Just look at what happened to Motorola. They brought out that stylish razor phone, and Linovo and god know's how many other companies ripped off the design within a year. Why buy a quality Motorola when there's a cheaper Chinese brand for less?

How are Chinese companies going to develop as well? If they can't sell their product in their own demostic market without being ripped off how are they goig to get the funds to compete globablly (which is where it's all going)?

According to the US trade link above' date=' China has already taken steps by passing a judicial judgement regarding the extent of criminal liability related to IPR. Is that a sign of acquiescence or merely appeasement on the part of the Chinese government?

Personally, I think there is very effective police/CCP control of other matters, for example 100% effectiveness on blocking media such as the BBC news and Wikipedia, so it seems hard to believe that websites offering illegal downloads and DVD vendors could not be controlled. [/quote'] This one I'm not sure on. It's definately not 100% effective since there are fake products everywhere.

[pandaxiongmao]

The government blocking Wikipedia and BBC obviously is not 100% effective, since Rose apparently in Shanghai and has quoted a BBC article. There are many ways around the firewall, and those methods are often not blocked.

By not cracking down on DVDs, Chinese people have an opportunity to see movies and lifestyles of people the CCP might not want them to see. So it would arguably would be in the best interest of the CCP to crack down if they really had the power to do so.

Outside of media, a better example of disregard for intellectual property would be the Chevy Spark. The Chery company stole the designs for the Spark from GM and was able to put their knockoff (the QQ) into production before the Spark. Why buy a Spark when the QQ is much cheaper, and the quality is about the same?

If it is companies taking apart competing products to see how they are constructed, that is the nature of business. A lot of foreign companies do that to competing products. As long as there aren't any patents being infringed, it is completely OK to do.

A lot of people perceive certain foreign products to be higher quality and maybe higher technology, so they do pay more money for them. An example would be Motorola's phones. They have good quality hardware.

The WTO complaint really would help China if it heeded it. I agree with Hero Doug, if Chinese companies keep ripping off the designs of others, they will always be a step behind innovators. They won't be considered to have good quality, and thus will never be particularly profitable. Then they won't have enough money to innovate, and the cycle will continue.

[simonlaing]

Hi All,

I agree that the Chinese government could crack down on the downloading movie sites if it wanted to. I think that in this regard they have leg to stand on. The DVD stores do serve to employ a lot of people in China though. Somebody told me they could comprise 2-3% of the small commerical industry in China and 1 % of GDP. That it a large amount.

The other arguement that my students used to make was that many of the building are built using pirated architecture design software which would cost thousands of dollars if they bought it out right. So this would retard growth in the building industry tremendously if they were forced to buy the software.

Now in the west with alluc.com, veoh.com, youtube etc. It is possible to download TV shows and Movies, how can they go after China when the governments can't control the internet sites in the West that are spreading movies.

I think Bush wants to be able to scapegoat China for the ills of the US that are mostly his doing. I think China will need to enforce copyrights if it want's its brands to become strong.

I am ambivalent on whether it was justified.

Have fun,

Simon

[bhchao]

I think Bush wants to be able to scapegoat China for the ills of the US that are mostly his doing. I think China will need to enforce copyrights if it want's its brands to become strong.

Just look at what happened to Motorola. They brought out that stylish razor phone, and Linovo and god know's how many other companies ripped off the design within a year. Why buy a quality Motorola when there's a cheaper Chinese brand for less?

How are Chinese companies going to develop as well? If they can't sell their product in their own demostic market without being ripped off how are they goig to get the funds to compete globablly (which is where it's all going)?

The Korean government has also filed complaints against Chinese companies ripping off designs from Samsung mobile products and Hyundai autos. The result is an exact imitation of the Samsung and Hyundai originals, with far reduced quality.

[Hero Doug]

Two more comments. I found out something interesting at the university that I work in.

Apparently if you pay enough money, your university can access any site world wide. I don't know what the price tag is, but the firewall can be lifted if you pay out enough yuan to the government.

The other thing is about site's like youtube. I read not too long ago that their the highlight of a fairly large court case that will dictate how responsible a site is for the content a user uploads. So we'll see where youtube and the others are after the ruling.

[imron]

Are you sure it's completely unrestricted, or is it just that people who told you don't realise the blocking that really goes on, and are perhaps slightly confused?

For example, many universities have a setup where students can access Chinese sites for a set, low fee, however international sites are blocked. If students want to access international sites it's also ok, but they have to pay more to access it. Many people I know assume this is "full access" however of course it's not. Access is sill limited to "acceptable" sites (i.e. not wikipedia, anything related to TMS etc). To some chinese this appears to be paying a fee to "unblock" the international sites, however of course they don't realise (and sometimes even deny) that other blocking goes on at a country-level.

Maybe it is as you say, but my first reaction would be the person telling you this maybe doesn't fully understand the situation/what you mean. Can you perhaps clarify this once again with them, and also let us know how reliable the source is?

[Hero Doug]

To be honest I'm not 100% sure. I asked them to do some research and I noticed that some students referenced Wikipedia. I asked them how they got on Wikipedia, and that's what they told me.

I actually have a meeting with the deen tomorrow, I'll ask him about it.

[sui.generis]

The other thing is about site's like youtube. I read not too long ago that their the highlight of a fairly large court case that will dictate how responsible a site is for the content a user uploads. So we'll see where youtube and the others are after the ruling.

On top of which, individual users can already be (and have been) sued for uploading pirated content. Sites can already be asked (and sites like youtube immediately cooperate) to remove any content studios claim (one aussie teen recently proved this by falsely claiming copyright infringment and pissing off the actual copyright holder) is their's, and they will turn over user information in some cases. So while infringment still exists, it isn't allowed to go unchecked and can be punished at the copyright holder's option.

[gato]

http://www.infoworld.com/article/07/04/13/HNchinaimprovingonpiracy_1.html

China improving on piracy, says top Microsoft lawyer

By Martyn Williams, IDG News Service

April 13, 2007

Microsoft is seeing some improvements to the considerable problem of software piracy in China, it's top lawyer said on Thursday.

"I think the last year has been the most important and encouraging year for software protection under the copyright law in China," said Brad Smith, senior vice president and general counsel for Microsoft, during a news conference in Tokyo.

"We're starting to see new PCs in China delivered to customers with legitimate software installed," he said. "That's a very encouraging step. We're starting to see more enterprises and government ministries purchase legitimate software. That's an encouraging step."

[Shadowdh]

To be a bit controversial I quite like the idea of piracy... I believe this has brought about the fall in price of genuine dvds and cds (at least here in the UK) to combat and compete with pirate versions. Also I think the US batters smaller (read in terms of economy) nations with these cases to protect their own industry... see the case against the vietnamese catfish farmers who had to change their product name to Bazaa or something like it so they couldnt be confused with southern american catfish products... apparantly their catfish isnt actually catfish... its sophistry at the lowest level... also when the film studios show pirate versions of dvds in films like "the pacifier" then does this mean they are accepting this as a sign of the times or condoning it in some small way...??

I dont believe they are wrong but I dont believe they are right... its not like the US doesnt have alot of this going on... and its not like companies havent been caught out using pirated software and so forth (I think one of the big recording organisations in america did this a few years back and was caught during its big anti-pirate campaign... ouch)...

[gato]

One of the key points made by several people above is that piracy hurts Chinese companies that produce movies, music, and software, as well. It is just that the Chinese industries in these areas have been so stunted by piracy that the monetary value of the injury is harder to calculate.

Could China have had its own Bollywood or Silicon Valley if it weren't for piracy? Nobody knows, but one could argue the point.

[Shadowdh]

True Gato...

[imron]

Not necessarily, there are also other factors at play that prevent a flourishing movie industry *cough* government regulations *cough* I think you'd find as well that if legitimate software/dvds were released at an affordable price that piracy rates would plummet.

[Shadowdh]

if legitimate software/dvds were released at an affordable price that piracy rates would plummet.

Thats what I think has happened here in the UK... a few years ago a new release would be £34 or so and now you can get them from about £7... I also think that regionalisation is harming the industry a bit too... now why doesnt some go all anti-competition about that...???

[Hero Doug]

The dean wasn't there so I didn't have a chance to ask. So I'll have to leave it up to you to decide, for now.