Thursday, March 30, 2006
China’s Crackdown on IPR Violations: Permanent or Temporary?
by from BeijingAccording to the China Daily, the Chinese government is trying to move swift and hard against intellectual property right (IPR) infringements. The government is planning on imposing stricter, quicker penalties on violators, or shutting down illegal operations completely. The immediate plan is to focus on DVDs and the software industry.
Over the last year, the government has destroyed over 106 million pirated discs and books. Based on the story, they have also shut down 223 illegal disc production lines since 1996—including six so far this year. The government is increasing incentives by offering rewards of up to 300,000 Yuan (US$37,000) to anyone providing information that leads to the detection of an underground production line.
I can readily observe the effects of the crackdown on the streets of the city. Over the last year and a half while living in Beijing, one of my favorite hobbies is, believe it or not, shopping. The number of cheap, pirated DVD and CD stores in Beijing and throughout China is enormous. However, over the last few weeks, many of the usual stops on my shopping trail have been closed. A few stores have recently reopened their doors, but they are no longer filled with the new releases that most of the shoppers want. Instead, they now display older movies that consumers have little interest in buying.
In the past, there have been similar periods when DVD stores have been temporarily shut down, only to open back up a few days later with completely restocked shelves. It will be interesting to keep an eye on the current crackdown to see if past patterns hold true, or if the new regulations and enforcement will keep illegal shops closed.
The new policies are currently aimed at DVDs and software, but as time goes on, the process will hopefully progress to other pirated goods. If this effort is successful, it should have a large impact on consumer habits and open the doors to more foreign and domestic companies that previously felt the security of their products and intellectual property were at risk in China. If they can make it stick, it is my belief this will also cause the world’s largest, fastest-growing economy to expand even more.
