Term Paper: Regulations of Trips Its Domestic Implementation and the Impact Upon China

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Regs of TRIPS, domestic implementation and impact upon China

The Regulations of TRIPS

Domestic Implementation and the Impact Upon China

The purpose of this work is to review relevant and available literature in relation to the Agreement on Trade Related Aspects of Intellectual Property or TRIPS in relation to IP Protection in China, as well as the impacts of TRIPS and to research this subject and then to accurately state the findings.

There is an expanding conflict that exists in relation to intellectual property rights and the violations against those rights of Americans by China individuals, companies, or entities. The piracy is illustrated through the pharmaceutical Viagra in relation to the Pfizer secured Chinese patent and the Chinese Ministry's categorization that imposes restrictions that allow the drug to be distributed at only a very few hospitals. Due to this generic Viagra is being sold in China by Chinese companies.

The problem is specifically that the remedies available in developing countries or those recently developed are few to none in relation to intellectual property. Cultural differences in regards to the amount of respect appointed to intellectual property rights vary greatly from one region of the globe to another.

Regulations of TRIPS

According to the article entitled "IP Rights Protection Will Improve in China - Eventually" (Clark, 2000) "Upon China having joined the World Trade Organization (WTO) the country will at that time be obligated to adhere to compliance in a vast array of obligations in opening the marketplace, inclusive of the General Agreement on Tariffs and Trade (GATT-Agreement on Trade Related Aspects of Intellectual Property (TRIPS). One requirement of TRIPS is that members provide "high levels of intellectual property (IP) rights protection and enforcement for copyrights, trademarks, patents, and trade secrets, among other forms of IP rights, must be implemented within one year of accession" (Clark, 2000)

During the first five-year span of the WTO membership of China the "production as well as the sale of both domestic and international and further of counterfeit and pirate products will rise." (Clark, 2000) on the short-haul results the production, distribution, export and sale of genuine products will in an equal manner assist the "production, distribution, export and sale of counterfeit products. It is predicted that as China enforces IP rights that the condition in this area in China will improve.

II. Exploration of the Domestic Implementations of TRIPS in Main Developed and Developing Countries

Pfizer and Glaxo have the Chinese as well as many other courts that are accessible to them. Several remedies with the scope of trade and foreign policy are available in the United States. There are also remedies of both informal and formal nature. Formal remedies fall within Section 301 Investigations - U.S.. Trade representatives may initiate an action of investigations into such an incident. (Trade Act of 1974) Trade Organizations complaints can be negotiated in elimination of the practices initiates by the World Trade Organization complaint and potentially retaliates against the foreign government. Raids and seizures of counterfeit goods have climbed 50% from 1997 to over 400 million units of infringement type products during 1998. Sate Administration for Industry and commerce. (SAIC)

Two fundamental shortcomings in the realm of enforcement which are 1) Almost no infringers of IP are prosecuted or imprisoned.

2) China's IP Administration bodies are poorly funded.

During the mid-late eighties and the 1990's there wasn't a huge problem although there were some incidences of counterfeiting cigarettes. At some point in the early 90's three factors caused or contributed to an increase in counterfeiting incidents which are stated to Clark (2000) to be Continued freeing of the economy in China allowed domestic companies to produce goods of their choice and to distribute them wherever they so chose.

The establishment of manufacturing facilities in China by Hon Kong and Taiwan companies (including counterfeits) and;

The growing appreciation within China of the value of IP rights, particularly in appreciation of the money that could be made from the infringement of others. (Clark, 2000)

Around the middle of the 90's a change occurred and manufacturers all across the globe made production simpler in order for cost to be cut in production. Japanese and Western Counties received processes used manufacturing this also made the work of counterfeiter's simple. The equation below illustrates this idea:

Fewer Parts

Simplified Production Technology =

Easily Copied Product

Meanwhile, the Chinese, with a "better trained skill base and sophisticated marketing. Trends fueling the increase in supply and demand for counterfeit products are:

Further freeing of China's internal market and semi-privatization of companies.

The increased spending power of domestic Chinese consumers;

The continued shift of manufacturing from Hong Kong and Taiwan to China

The greater access of Chinese manufacturers to world markets through the loosening of export controls; and Improvements in China's domestic distribution networks, particularly in communication and transport infrastructure.

Clark (2000) states that:

There is little doubt that freer trade will results in greater counterfeiting in the short-term. But greater counterfeiting in China would have occurred with or without China's accession to WTO, as long as China's economic growth continued. Moreover, the counterfeiting problems in China today are not unique to China. All developing countries pass through a stage of development where copying of products is widespread. Both the United States and Japan have passed through similar stages. The difference in China's case is that a country with one-fifth of the world's population will soon join the world's trading regime at the very time that international trade is freer than ever before. This has unleashed a flood of products both genuine and counterfeit onto the world market.

The Chinese IP Protection and TRIPS and the Problems/Impact and Recommendations of Actions to Improve

The comparison below shows clearly the differences that exists in TRIPS and China's Intellectual property laws:

Trips Agreement, Degree of Relevant

Provision/Article/

Compliance of Chinese Law

Requirement

Part I: General Provisions and Basic Principles

(1) Members to comply Complaint China is a party to the With Arts. 1-12 and Paris Convention

And Art. 19 of the Paris

Convention

National Treatment

Complaint Law doesn't discriminate required between Chinese and foreigners

Most favored nation Compliant Law does not discriminate treatment forbids between Chinese and Discrimination between foreigners

Between the nationals of members (Art. 4)

Part II Section 1: Copyright and Related Rights

10(1) Computer programs

Compliant Art. 7, Provisions

Programs, whether implementing in source or object code International to be protected as literary

Copyright Treaties works under the Berne

Convention

10(2) Compilations of Complaint Art. 14 Copyright

Data to be protected Law

Art. 8 Provisions

Implementing International copyright treaties

Rental Rights: Complaint Art. 14 Provisions

Authors of Computer Implementing

Programs and International

Certain cinematographic copyright treaties

Works have the right to authorize

or prohibit commercial rental of their copyright

China is in compliance throughout Part II Section One and as well is compliant throughout the Trademark section Part II Section Two, however in Part II Section 3: Geographical indications in relation to Protection of geographical indications and Additional Protection for geographical indications for wines China is not complaint and no legislation exists to protect geographical indications and spirits. China is compliant in Part II Section 4: Industrial Designs.

In Part II Section 5: Patents China is compliant in all areas except 27 Patentable subject matter: patents compliant available for any inventions whether products or processes, in all fields of technology provided that they are new, involve an inventive step and are capable of industrial application and in this area China is listed is "Essentially compliant" under articles 22 Patent Law and 25 Excludes scientific discoveries, rules and methods for mental activities and substances obtained by means of nuclear transformation. Exclusions not covered by TRIPS.

Under Part II Section 67: Layout Designs (Topographies) of Integrated Circuits China is not compliant and there is no legislation existent to protect layout designs of integrated circuits. In Part II Section 7: Protection of Undisclosed Information China is complaint however in Park II Section 8: Control of Anti-Competitive Practices in Contractual Licenses: China is not complaint but will become bound upon joining the WTO. This section is the control of anti-competitive practices in contractual licenses. A mechanism whereby a country seeking to take action again anti-competitive practices in contractual licenses can enter into the consultations with that other Member.

In Part III Section 1: General Obligations: (Enforcement of IP rights: effective enforcement proc3edures and judicial review shall be available. However does not require special intellectual property judicial system) China is stated to be complaint in view of the laws but in view of practice China is not always complaint. In Part III Section 2: Civil and Administrative Procedures and Remedies China is complaints although the laws are not always complaint. However in Part III: Section 2: 43 Evidence: Availability of disclosures/discovery of other side's evidence China is not complaint having no discovery or disclosure obligation but People's Court has the power to collect evidence from the defendant and other under Arts. 64 and 65 of the Civil Procedure Law.… [END OF PREVIEW]

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