IP owners enjoying stronger copyright protection in China

19 October 2020

IP owners enjoying stronger copyright protection in China

The existing Copyright Law in China has been in force for 30 years and has played an essential role in encouraging innovation and copyright protection. However, even with amendments in 2001 and 2010, the law is unable to cope with new situations and problems emerging in the copyright field. With China’s economy and society developing efficiently and rapidly, the amendment and improvement of the copyright law to deal with new problems is deemed urgent. The draft amendment shows the intensity and determination of China to protect copyright, which focuses on the follows:

  • Revising definitions (for instance, “audio-visual works” and “broadcasting right”) to cover new fields and things;
  • Enhancing the connection between the copyright law and other laws, (amending some of the notions and procedural clauses), and putting relevant regulations into practice effectively to further integrate with international treaties;
  • Aggravating penalties, such as the punitive damages, may be made for the amount between one and five times the amount of the compensation when the circumstances are serious, and the statutory compensation limit is raised from Rmb500,000 to Rmb5 million (US$73,600 to US$736,000).

One of the amendments to this law revises “movie works and works created by virtue of the analogous method of film production” to “audio-visual works,” making the classification of works clearer, which not only solves the difficulty in classifying new forms of works but also complies with the Beijing Treaty on Audiovisual Performances that came into force on April 28, 2020.

In addition, introducing the concept of punitive damages and increasing the limit of statutory compensation is beneficial to the fight against infringement, the protection of the interests of the obligee, and the needs of the market economy.

“The proposed amendments apply to both right holders and infringers,” says Ye Cai, a senior trademark attorney at Wanhuida Intellectual Property in Beijing. “The pros for the holder include expanded protection scope, less burden of proof, additional administration protection and more room of legal compensation to be claimed. We believe that most changes are beneficial. To a certain extent, they comply with the development by including a variety of works into the protection scope. Moreover, concepts such as punitive damages are introduced to strengthen copyright protection. Increased legal compensation amount from Rmb500,000 to Rmb5 million would, on the one hand, better protect the right holders’ rights and interests, and on the other hand, brings more hesitation to the infringers.”

In spite of these new amendments, Cai says that there are still concerns from the degree of administrative intervention, adding that it is yet to be seen as to how the judiciary will approach these issues:

  • Vague language is a double-edged sword. For instance, “the public interests” in Article 4 is a very general term, while the article prohibits the right holder from abusing rights to intervene in normal transmitting. That is, it would be on the authorities’ discretion in deciding “public interests” and “abusing.”
  • Risk of denying copyright protection to works that had not yet been approved by censors.
  • Stronger administrative intervention and enforcement. For instance, Article 4 restrains the right holder to intervene normal communication of works by abusing right, and Article 50 confers the administration with power to order correction, issue a warning, confiscate unlawful gains and impose a fine.

According to Ma Li, assistant director of the Beijing Justra Intellectual Property Center, the draft amendment has more effects on infringers than ordinary individuals.

“In the past, the imbalance between costs and benefits is the main reason for the difficulties in securing copyrights because the low compensation in copyright infringement cases makes it costs more to obtain authorization than simply pay the compensation,” she says. “Therefore, the draft amendment introduces the concept of punitive damages and increases the limit of statutory compensation, which responses to the many years’ appeal of the society, conforms to the practical needs of China’s economic, social and cultural development and strongly warns copyright infringement acts.”

With the copyright law as the one most sensitive to the development and practice of science and technology among the country’s main three intellectual property laws (the other two being the patent law and the trademark law), it is the most frequently legislated and amended IP law around the world.

“Taking the World Intellectual Property Organization as an example, five international treaties already issued or still under legislation from the 1990s until now are all about copyright,” says Li. “It is impractical and impossible to find a solution to the low cost of infringements and the difficulties in identifying infringement acts and enforcing penalties by merely one law. The effectiveness of the copyright law also depends on the enforcement of the law, the awareness of rights protection of the oblige, and the public concern. It should be realized that copyright is a production of the industry and post-industry society, whose development needs the cultivation of the market economy, which is a long-term and arduous project. Therefore, the popularization and education about the copyright law are to be emphasized from now on.”

Meanwhile, Cai adds that as the amendment empowers the administration to a certain extent, the expansion of administrative discretion and enforcement capacity should be a great challenge.

“While the level of responsible administration remains a question, due to lack of experience in dealing with similar cases, the new ‘range of work’ would definitely require the relevant quality the local enforcement officials, while at present, such quality is a gap, especially for local ones, for instance, county-level enforcement,” she says. “Thus, if the amendment of relevant provisions is realized, proper training of the enforcement would be in urgent need. In the meantime, the right holders could face difficulties in seeking protection for censorship reasons. As mentioned, the vague language of certain provisions may provide a challenge for consistent judicial interpretation as well.”

In spite of these challenges, both say the future is bright for the copyright law, as it is an essential legal basis for copyright protection which is continuously improved and effectively implemented.


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