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More Chinese brands striving for IPR
protection
BEIJING - Wenzhou city
of eastern China's Zhejiang province now handles about
400 trademark-dispute cases annually, which economists
consider an outcome of local entrepreneurs' thirst for
intellectual property rights (IPR) protection.
With the in-depth progress of market reforms in
China, domestic name brands, following a host of
world-famous multinationals, are resorting to the
protection of IPR after suffering the damaging effect of
shoddy and pirated products.
Rampant
counterfeiting landed Wenzhou's numerous private
enterprises in a credit crisis, but also impelled them
to take prompt measures.
Some local firms have
registered their name brands in all related product
categories, and a few have set up special IPR
departments within their companies to help supervise and
handle infringement cases.
Blue Cat, a
famous cartoon TV series, is now the most popular
locally made cartoon image among Chinese children.
However, its producer Sanchen Cartoon Group has also
encountered frantic counterfeiting and piracy in almost
all business it is involved in, including audio-visual
products, books, stationery, toys, food and clothes.
As counterattack measures, Sanchen registered
Blue Cat and another six cartoon figures in its TV
series as trademarks. It also formed a special IPR
protection office to connect its sub-companies and
distributors around China for united efforts in
combating piracy.
Experts said their methods
echo many renowned multinationals, who have long
regarded the establishment of special IPR protection
offices and sound IPR management mechanisms an
indispensable part of the entire enterprise management
system.
According to Zheng Liangsheng, a noted
domestic expert on IPR protection, Japan's Toshiba has
nearly 400 employees working for the company's IPR
department, Canon has about 300 employees and Mitsubishi
has 120.
"These IPR departments are usually
quite decisive on issues of patent application, IPR
franchising and handling of patent dispute lawsuits, to
ensure that their companies' IPR strategies fit their
long-term development strategy," Zheng said.
He
also acknowledged that various industry associations
should play a crucial role in helping enterprises cope
with domestic and international trade and IPR disputes.
A case in point is the Shenzhen Clock and Watch
Trade Association in southern China's Guangdong
province, which has taken IPR protection as a primary
task. It laid down rules concerning the IPR protection
for the China International Exhibition of Clocks,
Watches, Jewels and Gifts held in Shenzhen. It also
established an IPR bank to serve as a third notary for
any creation or design that had not applied for a patent
or received patent authorization.
Widely
applauded by the clock and watch enterprises, the
association's work has driven them to improve IPR
protection sense, encourage innovation and enhance
competitiveness, insiders say.
"Foreign
investors usually level patent charges through trade
associations or enterprise unions rather than the
individual company. However, Chinese trade associations
have lagged behind, lacking experience of organizing the
entire trade to cope with lawsuits and leading to many
unnecessary losses," Zheng said.
He said he
hopes more domestic trade associations will focus on
regularizing litigation and protecting the legal
interests of their members.
Rong Jianying,
deputy secretary general of the China name-brand
strategy promotion committee, said many home enterprises
had already fostered their own celebrated brands. The
protection of name brands will rely not only on a
government crackdown, but the participation of all
manufacturers and consumers to form a good market
environment, Rong added.
Fight against
counterfeiting
The Chinese government has
continued to step up its fight against counterfeiting in
recent years, prompted by the spread of fake products
damaging many transnationals by using their world-famous
brand names.
A survey released at the end of
July by the Quality Brands Protection Committee under
the China Association of Enterprises with Foreign
Investment (CAEFI) shows that counterfeiters lost some
market share from 1999 to 2001, although the quantity of
fake products did not decline.
More than half of
the 213 enterprises surveyed said the counterfeiting
problem had improved after the government launched a
nationwide campaign in 2001. A similar survey by the
Development Research Center (DRC) in 1999 found nearly
three-quarters of enterprises saying the situation was
deteriorating.
Official statistics show that the
market value of counterfeit goods seized during the past
two years was estimated at 5.6 billion yuan (US$677
million).
The public security departments of
Shenzhen and Dongguan cities in southern China's
Guangdong province recently launched a joint crackdown
on a criminal gang counterfeiting ink cartridges labeled
Epson, a Japanese brand, seizing more than 30,000 fake
cartridges and 300,000 fake packages. Local police said
the move helped Epson and other transnationals recover
confidence in the investment environment of the Pearl
River Delta, one of China's richest regions.
Meanwhile, the Crocodile trademark dispute case,
which attracted wide attention, ended in late October,
with the two Crocodile clothing firms, France-based
Lacoste and Hong Kong-based Crocodile, finally reaching
an agreement. The decision in the four-year lawsuit was
considered by insiders to be a good sign of more mature
IPR protection and mediation efforts by IPR departments.
A statement released on October 23 also said the
two companies would fight pirated products to protect
their common interests in the Chinese market.
Bernard Lacoste, chairman of Lacoste, regarded
China's improved IPR protection as a significant signal,
saying many international organizations would be glad to
know Chinese authorities were focusing on protecting
name brands.
The office of the national leading
group for rectifying and regulating market economic
order has launched a special communication and
coordination mechanism, aiming to offer government
departments a channel for collecting suggestions from
foreign-funded enterprises on the fight against
counterfeiting, IPR protection and investment
environment improvement.
Wang Bingnan, secretary
general of the office, said the government would
reinforce the crackdown on fake products and rectify
market order to create a better environment for overseas
investors.
(Asia Pulse/XIC)
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