China Opens Intellectual Property Courts to Improve Image

China will set up its first specialized court to handle intellectual property cases in Beijing within two weeks as it seeks to answer criticisms the country is lax in protecting such rights.

Courts dedicated to handling such trials on patents, trademarks and computer software issues will also be set up before the end of the year in two other major Chinese cities, Shanghai and southern Guangzhou, Wang Chuang, the deputy presiding judge with the IP division of China’s Supreme Court, said at a briefing today.

“This will be an important revolution of the country’s judicial system to deal with IP-related cases,” Wang said. It’s also “a step to promote the development of China’s emerging industries,” he said.

Foreign brands including Kering SA have raised issues about Chinese companies’ violations of intellectual property. China has made the watch list of countries needing to improve intellectual property rights protection in all 25 years that the Office of the United States Trade Representative has published an annual special report on the issue.

The Supreme Court today also said it will set up an intellectual property protection research center and train technical investigation officers to help judges who need professional expertise, Wang said.

‘Improve Image’

The establishment of the dedicated court shows the strong desire of China to improve its international image, according to Feng Xiaoqing, a law professor specializing in intellectual property at the China University of Political Science and Law in Beijing. Dealing with such cases remains a fairly recent development in China, he said.

“It might take a long time for the country to fundamentally improve its recognition and enforcement of IP protection,” Feng said.

Previous efforts by Chinese authorities to address the complaints include provisions to fight so-called trademark squatting, expand protection of trademarks and streamline application and appeal procedures that were enacted by the nation’s legislature in 2013. China is also reforming its patent, copyright, trade secrets, and other IP-related laws and regulations.

This year’s report from the U.S trade representative’s office cited China for inadequate trade secret protection and “indigenous innovation” policies that unfairly disadvantage U.S. rights holders in China.

The report noted “particular concern with the proliferation of counterfeit pharmaceuticals manufactured, sold and distributed” in countries including China. China is “a major source country” for active ingredients used in counterfeit pharmaceutical products, it said.

Kering SA filed a lawsuit in July against Alibaba Group Holding Ltd., saying that counterfeits of Kering brands such as Yves Saint Laurent, Bottega Veneta and Balenciaga proliferate on the Internet shopping platforms of Alibaba, according to a filing of the lawsuit. The New York lawsuit was withdrawn in August, after the two companies decided to cooperate on IP protection.

— With assistance by Keith Zhai

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