China As IP Paradise

A loyal reader (and esteemed Spain lawyer)  just sent me an email asking me what I think of a China Daily article, entitled, China Courts see surge of foreign-related IP cases. [link no longer exists].

I think the article is a good reflection of what is really going on in the world of China IP.

The article has the usual Chinese government fluff on how China is doing this or that to protect intellectual property, but it also includes some telling numbers:

China has seen a surge in foreign-related intellectual property rights (IPR) court cases since joining the World Trade Organization (WTO) in 2001.

China’s domestic courts tried and concluded 668 such cases in first instance last year, compared with only 43 in 2001, said officials attending a national court conference in Jinan, capital of Shandong Province, on Wednesday.

The following nearly immutable rules apply to international business and litigation:

1. Businesses almost always spend money based on a legitimate belief it will give them a return on their investment. Therefore, if foreign businesses are spending money registering their intellectual property (trademarks, copyrights and patents)  in China, they are doing so because they deem it to be good business and it almost certainly is.

2. Litigation is expensive.

3. In light of numbers 1 and 2 above, businesses do not pursue litigation unless they have reason to believe doing so will give them a good return on their investment or in some other way benefit their business. Businesses are pursuing IP litigation in China, which means those cases are perceived to be worth the money.

Bottom Line: Foreign companies doing business in China and with China are realizing it makes sense for them register their  trademarks copyrights and patents in China because there is legal recourse against those who infringe upon their IP rights. For how to protect your IP from China, check out Protecting Your IP In China.

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