Chinese-American business relations, long fraught with distrust
for China because it was not controlling piracy, appear to be
benefiting from a new Chinese respect for intellectual property
As Chinese innovators begin to see that there's money to be made
in protecting their own intellectual property, they're becoming more
willing to cooperate with big foreign firms.
The result? China's courts are now among the busiest in the world
for intellectual property rights (IPR) lawsuits. And Sino-American
business relations, long fraught with distrust for China because it
was not controlling piracy, appear to be benefiting.
US Ambassador Gary Locke yesterday praised China's progress in
expanding its IP protection regime last fall, after much US
lobbying, to ensure that China meet international standards in
protecting the building blocks of capitalism - copyrights, patents,
trademarks, and trade secrets.
"Ten or 15 years ago, most people in China saw IPR protection as
something only US or foreign companies cared about, but that is
changing as more and more Chinese entities are creating intellectual
property of their own," Ambassador Locke said as he opened an IPR
Former Commerce Secretary Locke lauded leading Chinese search
engine Baidu, once blacklisted for serving up links to stolen music
files, for cleaning up its act. Yet theft of IP in pharmaceuticals,
biotechnology, advanced manufacturing and entertainment, he said,
still results in billions of dollars lost each year.
For every $1 in computer hardware sold in the US last year, 88
cents of software was sold in 2011. Compare that with China, the
world's second largest economy, he said, where only 8 cents of
legitimate software is sold. Eighty percent of software sold in
China is thought to be pirated.
In fact, US companies such as Microsoft report they earn more
from legitimate software sales in Vietnam than they do in China, a
country whose economy is 50 times larger.
"But for every foreign company calling for stronger IP
protection, there are really more Chinese companies calling for the
same. Stronger IPR enforcement is essential to protect the work of
Chinese writers and musicians and to provide incentives to Chinese
firms to invest in research and development," Locke said. "There's
still much work to be done, but progress is occurring here in China.
We applaud that progress."
China's Vice Minister of Commerce Chong Quan said that now that
there are more than half a billion Chinese netizens, the platform
for piracy is huge. Online shopping in China rose 66 percent in
2011, outstripping the 11.6 percent jump in retail sales. "Internet
development has highlighted China's IPR problems, spurring a
crackdown on faked goods sold online," Chong said. …