Enter the Dragon: Navigating China’s IP Regime is About Understanding, Not Outwitting It

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In spite of China’s recent attempts to clean up its image as the protector of intellectual property rights (IPRs), and not the propagator of its violations, it still seems to have a long way to go to convince investors that it is the right place for their business.  And a lot of the focus seems to be directed toward protecting intellectual and intangible property, so that the goodwill and reputation behind a brand, for example, cannot be whisked away by pirates in the country’s local markets. National governments, for instance, have sections of their trade and investment departments dedicated to cautioning their citizens about the best ways to invest in China. More importantly, these countries also have guides for the best way to navigate the convoluted IP regime in China. Just three examples are the UK, US and Canada’s trade department sites.

Most of these guides are aimed at developed countries wishing to do business with China, and owing to the nature of global capital flows, the stage is beginning to resemble the East-West divide of old. On the one hand, are the nations with tremendous cash flows wishing to invest a country with tremendous business growth potential. On the other is the unsurety that comes with dealing with a government that is infamous for not respecting IPR-enforcement, and is secretive to boot. Combine that with two or more clashing traditions of thought behind the ownership of property, and you’ve got chaos and, most often, no good news.

There isn’t a simple solution to the problem, obviously; there never is. While blogs and commentators offer good advice on protecting IPRs, they seem to focus on providing tips from the perspective of the developed world, with protection being equated to common law notions of individual real property (see Lockean justifications of intellectual property ownership). Further, the current global IP regime is focused on locking away (no pun intended) the very sources of IP that are deemed as communal property in many parts of the world, and their “unauthorized” use is simply not seen as stealing or theft. While it is certainly not wrong for companies to want to ensure that their intellectual property is prevented from being used without authorization and compensation, it is perhaps wrong to expect that the developing world fall in line with already-established norms of intellectual property. This is especially so because these norms have been created without the philosophical, cultural and social inputs of the very countries they are now being imposed on. A contrast between US and China’s intellectual property regimes shows both how and why this disconnect has happened, as a case study.

These ideological differences are being played out in the economic realm, and since this year has already been a bonanza of trade and IPR-related agreements between various countries from the developing and the developed world, it is perhaps time to pay closer attention to just why the issues are what they are, rather than finding ways to circumvent them. Bigger countries like China and India can certainly take a firm stance on matters in which they are pushed too far, but this might not be the case for smaller, less-powerful emerging nations.

I’ll leave you with a video from the UK Trade and Investment (UKTI) that explains the underlying rationale behind IPR protection in China and Chinese culture, historically. While informative, it does seem to come at the issue from the angle mentioned above, and echoes that all-too-familiar “protection” aspect.

This might still be with good reason, however; as this blog points out, IP protection is indeed a challenge. Whether developed countries are entirely justified in this approach, however, is something you  be the judge of.

Image credit: Azzazello, Flickr stream: http://bit.ly/Pc7V65

About: Mekhala Chaubal

Mekhala is a graduate of Osgoode Hall Law School, Canada with an interest in all areas of intellectual property (IP) law in a transnational context, privacy rights, and the development of IP in emerging economies. She is currently immersed in learning about innovation, entrepreneurship and the finer points of patent, copyright and trade-mark law as IP Legal Assistant.

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