Transcript The legal framework for brand protection

CHINA - IP Issues
Silas Brown
Briffa
East Midlands International
Trade Association
Wednesday 12 July 2006
TM
®
©
BRIFFA
creative lawyers for creative business
Introduction
• Brief overview of doing business in China
• Commercial arrangements in China:
– Manufacturing in China
– Registering IPR in China
– Trade secrets
• IPR Infringement in China
– counterfeiting and infringement of IPR
– IPR enforcement routes
China
• China joined WTO November 2001
• IPR enforcement improvements - pledges.
• Massive growth:
– 2004 GDP growth 9.5%
– 2005 GDP growth 9.1%
• Trade between China 2005:
– UK exported £2.3bn, up 17%
– UK imported £10.5bn, up 23%
Guanxi 关系
• “Guanxi” - literally means “doing business
through value laden relationships.”
• Main reasons for building business
relationships in China:
– export
– license and manufacture
• Foreign invested manufacture enterprise (FIE)
Manufacturing: The Basics
• Licence: legal permission to do or own a specified
thing (i.e. manufacture goods)
• Authorising third parties to do something that they
would not otherwise be entitled to do and exercising
control over how they do it
• Contract law: Manufacturing Agreement
Manufacturing in China
• Know your manufacturer
• Heads of Agreement
• Lead costs?
• Full Manufacturing Agreement
• Communication
Manufacturing in China
• Points of particular importance to China
• Timetable:
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when will tooling be completed
when will sample/prototype be completed
what do you expect and when
approval procedure for samples before mass production
• Brand/designs:
– need to ensure and control quality
– register rights preferably in advance
– translation
Manufacturing: Key Terms
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Parties to the agreement
Purpose
Exclusivity?
Financial - minimums, royalties, licence fees
Quality control, approvals and insurances
Use of trade marks
Warranties
Termination
Registered Protection in China
• Trade Marks
– International classification of goods
– Protection
• Designs
– System of registration of “design patents”
– Protection
• Patents
Trade Secrets Protection
• Non-registrable IP rights
• “Technical and management information not in
the public domain”, which:
– can bring economic benefit; and
– the rightful party has adopted measures to maintain
in confidence
• Agree and enforce a Confidentiality Policy
Counterfeiting
• “Counterfeit”
– product which imitates another
– unauthorised reproduction of a trade mark
• Also includes:
– original product, produced beyond the scope of the
commercial agreement
– look-alike products
• “Unfair Competition” in the PRC
– look and feel of a product
– not reproducing the trade mark
Examples
Examples
Keeping Track of IP Infringements
• Practical Steps
– Carry out regular investigations
– Identify scale of problems
– Identify the source
– Gather evidence – photographs, film, investigator’s
statements etc.
China - IPR Enforcement Routes
• Enforce where appropriate and cost effective
• Means of enforcement:
– Administrative routes - designated authorities for
patents, trade marks, copyright and unfair competition.
– Civil routes - special courts designated for IP and “The
People’s Court.”
– Criminal routes/ Customs - “The People’s
Procuratorate”
Enforcement Routes
Administrative Authorities
• SAIC - State Administration for Industry and Commerce
• China Patent Office (CPO)
• National Copyright Administration (NCA)
SAIC
• Evidence
• File complaint (submissions) through government
designated agency
• Raid Action - may need to conduct pre-raid
investigation as goods move quickly
• Remedies
Raid
Enforcement Routes
Civil Action
• Evidence
• Complaint filed by PRC lawyer
• Immediate order for preservation of evidence and
property
• File suit - i.e. request for trial in court
• Hearing
• Remedies
Enforcement Routes
Criminal Action
• Infringement must be an exact counterfeit
• Infringement must involve “very large” amounts
of illegal income or “especially serious
circumstances”
• Complaint filed by PRC lawyer
• Very wide powers of investigation
• Penalties
Summary
• Protect your IPR through legal agreements
• Register your IPR in China
• Enforce wisely and cost effectively
谢谢和再见
见
TM
®
©
BRIFFA
creative lawyers for creative business