45. The representative of China said that his delegation welcomed this opportunity to elaborate on the status of China's implementation of the TRIPS Agreement and other relevant commitments, and on its intensified IPR enforcement efforts since the last review through more effective administrative sanctions, as well as to brief the Council on China's efforts in deepening its international IPR cooperation with other Members in recent years. Ever since adopting the reform and opening up policy, particularly in recent years, China had made impressive progress on IPR protection and had recently incorporated it into its national strategy. Furthermore, the Chinese President Mr. HU Jintao had reiterated in his report to the 17th CPC Congress the Party's determination to "improve indigenous innovation, build an innovative country… and implement IPR strategies", which would serve as a long-term goal for China to pursue firmly in its IPR protection task.
46. Regarding the legal infrastructure perspective, in a short period of merely 30 years, China had put in place a legal and regulatory IPR framework incorporating laws, regulations, department rules and judicial interpretations. In order to respond to its own development needs and in order to advance its national drive to build an innovative country, China was constantly studying and formulating new IPR-related laws, regulations and rules and making improvements of its IPR protection system.
47. In 2006, the State Council had promulgated the Regulations on the Protection of the Right of Communication through Information Network. The Supreme People's Court (SPC) had issued the Decision (No. 2) on Amending the Supreme People's Court's Interpretation on Certain Issues Concerning Application of Laws in Dealing With Cases Concerning Computer Network Copyright Disputes. The Supreme People's Procuratorate (SPP), the Ministry of Public Security, National Copyright Office, State Administration for Industry and Commerce (SAIC) and General Administration of Customs had issued four regulations on accelerating civil-to-criminal case transfer. The Ministry of Commerce (MOFCOM) and others had introduced specific rules on IPR protection related to trade fairs and exhibitions. The State Intellectual Property Office (SIPO) had issued the Guide on Patent Re-examination and Measures for the Reduction or Postponement of the Payment of Patent Fees. The SPC and SPP had clarified the criteria for convictions relating to IPR crimes involving piracy and illicit sales of audiovisual products.
48. On 1 April, 2007, the National Working Group for IPR Protection had published the 2007 Action Plan on IPR Protection, which detailed 276 specific measures in ten areas including legislation and enforcement. Under this Action Plan, China would formulate and revise 14 laws, regulations, rules and administrative measures on trademark, copyright, patent and customs protection as well as seven judicial interpretations and guidelines. In the first half of 2007, the SPC had issued the Opinions on Fully Intensifying IPR Trials to Provide Judicial Assurances for Building an Innovative Country, the Interpretations on the Application of Laws in Civil Cases Involving Unfair Competition, and the Rules on the Application of Laws in Disputes Involving Infringement of Right to New Plant Varieties. The SPC and SPP had jointly circulated the Interpretations on Issues Relating to the Application of Laws in IPR Criminal Cases II. The SAIC had promulgated the Measures for the Administration of Special Signs of Geographical Indication Products. The formulation and updating of the Trademark Law, Law against Unfair Competition, Patent Law, and Patent Commissioning Regulations was also progressing on schedule.
49. On the IPR enforcement side, within the framework of international conventions and treaties such as the TRIPS Agreement and taking into consideration its national situation, China had come up with an IPR protection model featuring a parallel and concurrent system of administrative and judicial protection as well as an enforcement structure that effectively integrated administrative approaches with criminal justice, ensuring adequate protection for rightholders and ultimate fulfillment of China's international IPR obligations. In 2006, China had set up IPR Service Centers in 50 large and medium-sized Chinese cities and had launched the special "12312" service hotlines to facilitate IPR complaints and crime reporting. IPR enforcement agencies had carried out seven dedicated crackdown campaigns including Operation Sunshine, Operation Blue Sky, Mountain Eagle Two and the Anti Piracy 100 Days Campaign, which had resulted in notable achievements.
50. Regarding the series of figures detailing China's efforts on enforcement, he referred Members to the information his delegation had provided under Annex I of Article 18 of China's Accession Protocol. In response to some Members' interventions, he emphasized that in 2006, 2,277 criminal IPR cases had been settled with a verdict of legal effect regarding 3,508 persons, 3,507 of whom had been convicted. This clearly demonstrated China's efforts to intensify criminal enforcement.
51. Some Members had also quoted increased numbers of seized pirated products at their borders. Also in China there had been an increase in the number of seizures of pirated products. From his perspective, these figures only demonstrated that China's efforts on IPR enforcement were more intensified, not less.
52. Regarding international IPR cooperation, on 29 December 2006, China had announced its decision to join the WIPO Copyright Treaty and WIPO Performances and Phonograms Treaty. On 9 June 2007, these two treaties had officially taken effect in China. At present, China was also approaching its final procedures for ratifying the Protocol Amending the TRIPS Agreement.
53. China had been actively involved in the reform of international IPR systems and negotiations on global IPR issues in international forums such as the WTO, WIPO, UPOV, APEC and ASEM, while increasing bilateral IPR collaborations with other Members. China-US, China-EU, China-Russia and China-Switzerland IPR working groups had been set up to meet regularly. IPR exchange mechanisms had also been established and consolidated between China and other countries and regions, such as Japan, Korea and ASEAN. In 2007, the first sessions of the China-Russia IPR Working Group and the China-Switzerland IPR Working Group, as well as the fourth session of the China-EU IPR Working Group had successfully been convened, cementing IPR exchanges and cooperation. China had also held a China-US Enforcement Cooperation Joint Liaison Group meeting, had signed an MOU on Intensifying IPR Enforcement Cooperation between the Chinese and US customs services, and had hosted the WIPO Asia-Pacific Symposium on Performers' Rights in the Digital Network Environment, as well as an international symposium on geographical indications.
54. In conclusion, despite being a developing country confronted with many difficulties, China had never slowed down its pace of IPR protection. It should be underlined that IPR protection was a global issue and not a country-specific one. As developed and developing Members shared the daunting challenge of improving IPR protection, cooperation should serve as the main vehicle for international endeavor in the field of IPR protection. China was determined to further improve its IPR protection and enforcement system through unremitting efforts and to collaborate extensively with other WTO Members on this issue.
55. Responding to the technical questions submitted to China, another representative of China said that around 20 of these questions were closely related to the WTO dispute case DS362 or the case on market access of goods and that, therefore, her delegation did not deem it appropriate to provide responses to them. For the sake of clarity and efficiency the other questions had been categorized into 11 groups.
56. Responding to question in the first category on General Issues, she said that, regarding transparency, Chinese IP legislation was quite open and transparent. It had been provided that between the release and implementation of laws and administrative regulations at least one month had to be allowed for public comments. Before submitting drafts of laws and regulations for deliberation and review, they had to be made public for comments from all, including experts, scholars and practitioners in IP-related fields. In addition, China also paid great attention to opinions from IP-related international organizations, foreign enterprises and individuals. All suggestions were taken seriously and submitted for detailed analysis and classification. The feedback of some crucial suggestions would be delivered to the organization or individual that had made the suggestions for further comments.
57. For example, in 2004 and 2005, the Supreme People's Court had made available on the Internet the five judicial interpretations, respectively on technical contracts, unfair competition, new plant varieties, right conflicts and legal application of MTV copyright, for public comments. Revisions had been made according to comments from the public. In China's IPR legislation, it was rarely the case that more than one agency was involved in drafting legislation at the same time. However, if such a case did occur, according to the Ordinance Concerning the Procedures for the Formulation of Administrative Regulations and the Regulations on Procedures of the Rules Formulation, all the agencies involved were required to solicit public opinions in the process of drafting administrative rules and regulations. In addition, if the draft administrative rules and regulations related to responsibilities of more than one agency, the drafting agency was required to fully consult with all the other agencies involved to ensure coordination and avoid inconsistencies among different IP-related agencies.
58. In the process of the third amendment to the Patent Law, opinions had been solicited widely from related government agencies, organizations, enterprises and citizens, and a great number of suggestions for amendments were collected. In addition, the Legislative Affairs Office of the State Council had held an international seminar on the Patent Law Amendment on 10-11 October 2007. Experts, scholars, representatives from Chinese enterprises, WIPO and well-known companies in the US, EC, Japan, Brazil, India, etc. had held comprehensive and in-depth discussions on the amendment of the draft.
59. For the amendment to the Trademark Law, the State Trademark Office had begun to solicit social comments by sending letters and holding seminars since April 2006. By the end of 2006, 48 correspondents with 1,012 pieces of suggestions from 47 organizations, groups and individuals, including foreign organizations such as the USPTO, JPO, INTA and AIPLA had been received. In late September 2007, a new round of solicitations for opinions from domestic and foreign institutions and experts was launched.
60. Regarding IP protection and enforcement, China had taken many effective measures in recent years to push forward IPR protection in a comprehensive manner and had achieved good results. China had further improved its legislation, greatly enhanced its efforts to fight against infringement, increased the number of criminal prosecutions and penalties, and had strengthened public awareness for IPR protection. The Chinese Government had been exploring ways to establish an effective IPR protection system. However, as China was still a developing country, it was unrealistic and unreasonable to require China to reach the standards of developed countries like the European Communities within a short period of time. China hoped that the European Communities could continue to support China in its IPR protection endeavors, improve mutual understanding and trust, and reduce complaints and criticism.
61. Responding to questions in the second category on Legislation and Judicial Interpretations, she first turned to the revised draft of China's patent law. As the revision of the Patent Law was still underway, her delegation was unable to predict the final results and could therefore not provide further clarification of the provisions at present. China's Anti-Monopoly Law would come into force on 1 August 2008. Currently, there was no explicit definition of "abuse of IPR" in Article 55.
62. On conflicts between trademarks and trade names, the existing Law to Counter Unfair Competition was still under review and in the process of being amended. In November 2005, the Supreme People's court had formulated the draft text of the Interpretations on Applicable Legal Issues Concerning the Ruling of Civil Cases Involving IPR Conflicts, and had solicited public comments through the Internet in December 2005. The Judicial Interpretation draft covered relevant issues on conflicts between trademarks and trade names. Her delegation was currently unable to provide any details.
63. On the issue of royalty criteria for broadcasting and television organizations, according to the provisions of Article 43 of the Copyright Law, the Chinese State Council was working on Measures on the Remuneration for Using Audio Products by Radio and Television, and related legislation procedures were now underway.
64. According to Article 43 of the Regulations on Copyright Collective Management, when a user was able to provide the details of use but refused to do so, or practiced fraud in providing such information, the copyright administration departments of the State Council were required to rectification. The copyright collective management organization could terminate the Licensing Contract.
65. Regarding the import and export of technology, according to the Regulations on Technology Import and Export Administration, the administration of technology imports was divided into categories of technology prohibited from import, technology restricted from import and technology of free import. The technologies of free import were managed through contract registration without real examination of the contents of the contract. On the other hand, the competent authorities still needed to instruct the enterprises to provide the authentic basic information of the contracts. In actual practice, some of the provincial and municipal authorities could suggest revisions of terms that were non-compliant with China's existing laws and regulations in the technology import contracts of the enterprises, but the final say still rested with the enterprises. The Government had never made compulsory requirements on items like royalty rates.
66. Article 355 of the Contract Law explicitly provided that "Where the laws and administrative rules and regulations stipulate otherwise on the technology import and export contracts, or patent contracts or contracts on application for patents, such provisions shall prevail". The Regulation contained special provisions for the infringement liability in the technology import contract in the form of administrative regulation, without contradicting the Contract Law. Article 24 did not conflict with Article 28.2 of the TRIPS Agreement. According to this Article, "The patentee has the right to transfer or transfer through inheritance the patent and establish license contracts".
67. Article 25 of the Regulation was appropriate and currently China had no plan to revise it. This Article focused on the technology itself, i.e. under the agreed conditions the technology could achieve the agreed technological objective. If the mishandling of or other failures to meet the agreed conditions by the Chinese side led to a failure of achieving the agreed technological objective, the responsibility should be borne by the erring party. Since this Article was mandatory, whether the concerned parties made written commitments or not to implement the above provision in their agreement, its effect could not be affected and the Chinese Government would not reject the agreement for such reason.