46. With respect to the assignment or licensing of trademarks, he said that no government approval of the terms of a licence or assignment was required. However, a trademark licence must be reported to the TMO for the record, regardless of whether the trademark owners were Chinese or foreign. The recording was not required for an assignment contract. As for the effect of the recording of a licence contract, although there was no express provision in the Trademark Law, the judicial interpretation provided that, where the trademark licence contract was not recorded at the TMO, it should not affect its effect, unless otherwise agreed between the interested parties, but an unrecorded licence contract should not resist a third party with good faith. In addition, the Trademark Law provided that the assignment of a registered trademark should be published after it was approved. The assignee should enjoy the exclusive right to use the mark from the date of the publication.
47. Turning to geographical indications, he said that, to date, the TMO had received 260 GI applications for the registration of certification marks, 100 of which had been approved. The registrant of a certification mark could file a complaint with the local authorities for industry and commerce or might file a law suit at the People's Court requesting to stop an infringement.
48. With respect to the exceptions to GI protection provided for in Article 24 of the TRIPS Agreement, he said that every country might encounter the problem of earlier registered trademarks and the GIs. Article 16 of the Trademark Law was substantially in compliance with the exceptions provided for in the TRIPS Agreement. He said that China had acceded to the WTO on 11 December 2001 and the latest amendment of the Trademark Law had come into force on 1 December 2001. Those marks which had obtained registration in good faith would continue to be valid under Article 16 of the Trademark Law, which referred to marks registered before this date rather than after it.
49. The State General Administration for Quality Supervision, Inspection and Quarantine (AQSIQ), in accordance with the Regulation for the Protection of Products with Geographical Indications, carried out the protection of GIs. If a trademark or certification mark already existed, the AQSIQ would still provide GI protection from different respects and functions according to the Regulations and the related stipulations in the TRIPS Agreement. The following action had been taken against the infringement of GIs: the AQSIQ was the authorized government agency with two major functions, namely comprehensive administration and law enforcement. The agencies of the AQSIQ executed random checks and law enforcement against the infringements of GIs and trademarks in accordance with the Law on Product Quality, the Law on Entry and Exit of Commodities Inspection, Standardization Law of the People's Republic of China, and other relevant laws and regulations.
50. Turning to the protection of copyright, the representative of China said that a series of activities had been organized to study and prove the necessity and feasibility of the provisions that might be introduced in the regulations on the protection of the right to communication through information networks in respect of specific copyright matters. For example, in October 2002, the State Council had sent a high level delegation to Europe to investigate copyright systems in the digital network environment. In November 2002, the National Copyright Administration of China (NCAC) organized a delegation to visit WIPO and exchange views with the organization in respect of China's accession to the two new treaties. In July 2003, the NCAC had held a forum on the Internet Treaties and copyright protection in the digital network environment and listened to opinions from legal and network circles. In November 2003, the NCAC would invite WIPO experts to China to give touring lectures on the two new treaties. The competent authorities had also carried out various other relevant activities. With regard to legislation on copyright protection of digital networks, he said that there was still much work to be done by the competent authorities in a thorough and careful manner, including the investigation and study of the legislative experiences of other Members.
51. Regarding the protection of temporary copies, he said that such term was used neither in the Berne Convention nor in the TRIPS Agreement. In regard to re-publication of materials in Chinese textbooks, he said that, to date, the NCAC had not yet obtained any information in this respect from foreign right owners or domestic publishers.
52. In regard to the reasonable royalty to be provided for under Article 10 of the Regulations for Protecting Software, he said that so far no copyright administrative department had dealt with such a case, and there had been no news reported concerning the relevant judicial decision. In addition, he said that under Article 30 of the Regulations, the "holder of copies of a piece of software" was defined as the end user of software who had performed a reasonable duty of care and had obtained a copy of software in good faith. Accordingly, it could not be inconsistent with Article 13 of the TRIPS Agreement. If the holder of the copy of software used an infringing copy, the person was obliged to prove that he or she had never known, or had reasonable grounds to know, that such a copy was an infringing one.
53. With respect to the use of software for the purpose of study and research provided for in Article 17 of the Regulations, he said that Article 17 contained the same principles as adopted in Article 22 of the Copyright Law concerning fair use. According to Article 21 of the revised Implementing Regulations of the Copyright Law, fair use should not conflict with the normal exploitation of the work and should not unreasonably prejudice the legitimate interests of the right holder. Consequently, Article 17 of the Regulations should be deemed as consistent with Article 13 of the TRIPS Agreement.
54. In accordance with Article 47 of the Copyright Law, copyright administrative departments had been authorized to take action against an Internet Service Provider (ISP) who was illegally making the content available to the public or downloading it.
55. In China, if an infringement took place on the Internet, the infringer, whether an individual or a legal entity, should bear the corresponding legal liabilities pursuant to the Copyright Law. He added that the NCAC had not issued any directive regarding the proper use of the Internet in universities, government offices or state-owned corporations.
56. Regarding the prosecution of hackers, he said that, in February of 2002, the copyright administrative department of Zhejiang province had dealt with a case concerning "the US Chemistry Digest Disc Publication" pirated by means of illegal decoding. Two suspects had decoded a lawful copy of the disc, made reproductions and then sold them on the Internet by sending batches of mails. The copyright administrative department had ordered the decoder and the two suspects to cease the infringing acts and confiscated their unlawful income. In addition, the competent department had confiscated the equipment and tools mainly used to make infringing copies, destroyed the infringing copies and imposed a forfeit on the two suspects. Regarding the removal or alteration of electronic rights' management information, he said that this issue was not covered by the TRIPS Agreement but by the WCT. Nevertheless, the issue was under consideration in China.
57. In respect of the Copyright Law, the Regulations neither decreased nor increased the burden of proof on the right holder. On the other hand, the revised Copyright Law increased the burden of proof on the party against which an action was brought by adopting Article 43.2 of the TRIPS Agreement. The Regulations reflected the legislative purpose of the Copyright Law. According to Article 3.2 of the Regulations, administrative procedures could be initiated not only on the basis of complaints from right holders but also with the removal of cases by other relevant departments, reports from other persons finding out infringements, or initiative investigations by administrative departments. In accordance with the Regulations, the NCAC had to investigate the case with a great impact in the country, which was determined at the NCAC's discretion. In general, an infringement should be dealt with by the local administrative department of the place where the infringement was committed.
58. With respect to the negative prescription of administrative penalty, he said that Article 9 of the Regulations was consistent with Article 29 of the Administrative Penalty Law of China, i.e., where an illegal act was not discovered within two years of its commission, administrative penalties should no longer be imposed, except if otherwise prescribed by the law. The period of time prescribed should be counted from the date the illegal act was committed. If the act was of a continual or continuous nature, it should be counted from the date the act terminated. The prescription of administrative penalty was different from that of a civil action in that the latter was calculated from the date on which the injured party had known or had had the reasonable grounds to know that his rights had been infringed while the former was calculated from the date on which the illegal act had taken place or stopped.
59. Regarding the identification of holders of copyright, he said that the copy of a work with a complainant's name on it might be deemed as a proof of the right holder's identification. A copyright registration was not necessarily required for complainants to apply to administrative procedures. The expression "parties' names" included not only the name of the right holder but also that of a complaining party. Otherwise, an administrative department could hardly investigate a case or render specific administrative penalties without having obtained sufficient information concerning the complaining party, or without having known the exact complaining party. An administrative department might not accept an application for administrative procedures if it was not in charge.
60. He said that the expression "person who has a burden of proof" as mentioned in Article 16 of the Regulations referred to the complaining party but not the right holder. The expression "parties" in the same Article referred to both the right holder and the complaining party. Whether an illegal act was slight or not was determined by the administrative department according to the concrete circumstances of each case.
61. Regarding the auction or re-selling of facilities used for making infringed goods, he said that the person who bought such facilities must observe the law. Moreover, such facilities could be bought only by factories in lawful operation and with the requisite qualifications.
62. With regard to the trial term, he said that Chinese courts would strictly follow the Regulations on Civil Procedure Law and judicial interpretation. According to Article 147 of the Civil Procedure Law, the parties who could not accept a judgement or decision might lodge an appeal. According to Article 178 of the Civil Procedure Law, the parties could apply for another trial to the same court or the superior court for those cases which had been effective. Besides, the court or the procuratorate could start supervising procedures.
63. The representative of China said that commercial exporting belonged to selling. According to the provisions of Chinese laws and judicial interpretations, the intellectual infringement crime of counterfeiting goods export might lead to more serious punishment in manners, methods or results, and the culprit could be punished under more serious accusations. Therefore, some of these intellectual infringement crimes were punished pursuant to the conviction standards for "smuggling" or the conviction standards for "carrying out illegal business activities" in the same law. Second, any of the actions which infringed upon copyright or circumvented a copyright technological protection measure for the purpose of producing, reproducing, distributing and selling, would be directly convicted for the crime of infringing upon copyright. Those who offered help for the above-mentioned actions would be convicted for complicity. If trafficking technological protection actions infringed the monopolization, franchising or restrictive dealing, the culprit would be directly convicted for the crime of selling infringing reproductions. If simultaneously infringing the copyright, the culprit would be co-convicted for the crime of infringing upon copyright. If for the purpose of reaping profits or where the amount of illegal gains was huge, which accorded with the judicial stipulation, together with other serious circumstances, a criminal conviction would also result. Layout-designs and utility and design patents were protected by China's Patent Law and the relevant regulations. Forging others' patents with serious circumstances would be convicted of the crime of forging others' patents according to Article 216 of the Criminal Law.
64. He said that the statistics of privately initiated criminal cases accepted by the Chinese courts from January to September of 2003 were the following: one on copyright, one on commercial secrets, two on selling infringing reproductions, 18 on producing and selling counterfeit products.
65. Apart from those noted in document IP/C/W/374, there were two main regulations concerning the circumstances in which investigations should be initiated by the procuratorate or by individuals: the Interpretation Regarding Practical Questions Concerning the Judicial Application in Hearing the Illegal Publication Criminal Cases by the Supreme People's Court, and the Interpretation Regarding Practical Questions Concerning the Judicial Application in Hearing Producing, Selling Counterfeit Goods Criminal Cases by the Supreme People's Court and the Supreme People's Procuratorate. At this stage, the Supreme People's Court had been carrying out investigation and research concerning the responsibility and scientificity of the Standards for Initiating Criminal Cases. China would stipulate the interpretation with the feasibility or submit the relevant law-making suggestions in the near future. Regarding the steps which were being taken to facilitate the referral from administrative agencies, he referred to the Provisions on the Transfer of Susceptible Criminal Cases by the Administration Organs for Law Enforcement.