Stratic Advice on Intellectual Property Investment in Asia
苏冉
IssueⅠ: Legal framework of protection on software copyright in P.R.C and Singapore
A) P.R.C
In conjunction with China’s astonishing economic growth over the past two decades, especially after the entrance to WTO, China has steadily improved its legal framework on Software Copyright by checking and clearing large-scale regulations both in domestic and international activities.
Frankly speaking, China joined in three vital international treaties relate to copyright: the Berne Convention , TRIPs and Universal Copyright Convention. Moreover, China and US signed MOU especially for software in January 1992. All these Conventions are regarded as a milestone to reflect China’s dramatic promotion and strong determination to build a satisfactory environment for foreign software investors.
Similarly to US, P.R.C has chosen to protect software under copyright law rather than trademark, patent, or contract law. One year after Copyright Law Amendment in 2001, Chinese Council corrected its software-specific “Computer Software Protection Rules” , to deal with new problems prevailing in software protection nowadays. Under the Rule, software is defined as two particular types: computer program and their relevant documentation. Furthermore, since MOU came into force, computer software is protected as a literary work. Third, according to the conditional nation treatment here, foreigners are required to comply with “connecting factor”, to sum up, either first publication or nationality/residence of the author in China or in any of these countries ,between the work and China or a country who is a member of the WTO, or the Berne Convention. So, despite your software products first being published in US, you can still enjoy the original copyright and the legal protection on in China.
Except from the above rules, other laws also have supportive stipulation on the protection of software copyrights as follows:
(a)The General Principle of Civil Law, the country’s current basic civil law, has authorized the author’s copyright in general;
(b)The Criminal Code has a section of articles referring to piracy offences, with “Dual Punishment Principle” in front of copyright encroachment;
(c)The newly amended Foreign Trade Law (adopted in Feb).
B) Singapore
The general legal framework of software copyright protection in Singapore is almost the same as P.R.C, but with some characteristics of its own. Actually, different from P.R.C based on Civil law background, laws and litigations in Singapore are principally modeled on the English system under Common law system till nowadays. Pursuant to certain legal revolutions, modern copyright legislation contains the same international conventions as P.R.C: the Berne Conventions, Universal Copyright Convention, and TRIPs. But, Singapore signed ASEAN Framework on Intellectual Property Cooperation and the WIPO Copyright Treaty as a member of ASEAN. Turning to its domestic laws, the latest Copyright Act 1999(revised edition) is the principle one, with some other relevant regulations for enforcement. And it also definites software program into literary work under protection. In addition, Singapore owes large resources of case laws so as to make its legal conditions more particular than that in P.R.C.
The amended Act is first purposed to address issues arising from the use of copyright materials in a digital environment, especially provide legal certainty for the use of copyright in cyberspace. For instance, the extension of concept “reproduction” .Second, the Act plays another role in enhancing performer’s rights, offering two new defenses to allegations of copyright infringement. Therefore, merely surfing the Web doesn’t constitute software copyright infringement, if it’s necessary to browse. Even , Singapore passed the Electronic Transactions Act 1998 to give statutory protection of Network Service Providers. At these points, Singapore seemingly forwards a step further than P.R.C, declining its attention on encouraging the growth of a knowledge-based economy and promoting E-commerce and creative innovations. Last but the most significant point, Singapore and the United State signed a bilateral free trade agreement (FTA) on May 6th 2003, and entered it into force from January 1st 2004. Virtually, this is the first FTA between US and an Asia country .So it’s doubtlessly the greatest advantage for Singapore to attract US investors, apart from other Asian countries. They would encourage the entrepreneurship, investment, job creation and growth in our own technology, science and creative industries as well as set the stage for Singapore’s emergence as a global IP hub.
Issue Ⅱ: Implementation on Software Copyright Law in P.R.C and Singapore
Sufficient and effective enforcement is more useful and practical than recorded documents, with no exception to P.R.C and Singapore.
(ⅰ)Role of Government
A)P.R.C
Learned from Annual Report on the Protection of Intellectual Property Right in China during the past 5 years by the head officer Jingchuan Wang in TableⅠ , you can see copyright administration at various levels make remarkable progress in encouraging innovation, promoting industrial development, regulating market order, and even improving the opening-up policy.
As a matter of fact, the People’s Courts, the People’s Prosecution Department, National Copyright Administration Centre and Public Security compose the backbone of the implementation of copyright law in China with civil remedies, criminal sensations and administrative punishments, such as fine. And border enforcement assistance to copyright owners by the Customs and Excise Department is also available.
TableⅠ:
The Administration on Software Copyright In P.R.C
Year Registration Prosecute Cases Resolved Cases Resolved Cases Rate Seized Pirates(M) Top 1 Region of Piracy
1999 1,041 1,616 1,515 93.75% 20.14 Shenzhen
2000 3,300 2,457 1,980 95.30% 32.60 Guangdong
2001 4,620 2,683 2,327 97.52% 61.75 Guangdong
2002 4,860 2,740 2,604 99.02% 67.90 Guangdong
2003 5,020 6,120 5,793 97.64% 73.28 Beijing
Statistics from NCAC (National Copyright Administration Centre
Fortunately, China has begun to regard software as an industry with strategic significance while formulating effective policies in areas including anti-piracy and anti-monopoly. To adapt to the legal framework, China has shifted its attention upon educating software users and strengthening the law. “Government departments are being asked to show a good example in using copyrighted software only and make software budget each year”. For example, Beijing, Shanghai, Guangdong buy over 3,000 software products every year through public bidding. What’s more, the National Software Government Procurement Regulation will probably act in the near future. Eventually, Chinese government is trying to treat all software companies equal in P.R.C, no matter domestic or foreign countries.
Nevertheless, given China’s vast geography and population, it would be an awesome task for the central government to manage pirating activities throughout the entire country. On the other hand, due to lack of resources, the lack of judicial expertise, the unpredictability of trial outcomes, and large costs, litigation in Chinese courts remains a risky and expensive response to Chinese copyright violations. Another administrative difficulty arises from the increasing decentralization of the Chinese government. Much of China's copyright enforcement takes place at the provincial and local levels; the national government lacks the resources and control to effectively monitor nationwide pirating activity and to impose national enforcement policies.
B) Singapore
Switching to Singapore, the Intellectual Property Office of Singapore (IPOS) is its senior administration department, and it leads Singapore to the success in copyright infrastructure. Singapore has announced a number of meaningful standards through requirements for tough penalties to combat piracy and counterfeiting, including, in civil cases, procedures for seizure and destruction of pirated and counterfeit products, and a requirement to provide for statutory and actual damages to remedy such practices. There has been a rule in Singapore that government could only allowed to use copyrighted software since 1996. In order to obtain efficiency, Singapore maintain civil remedies and criminal penalties for circumvention of technology protection measures, and it also has in place implementation allowing for border seizures of infringing articles by customs officials. For example, the copyright infringement is punished with a maximum fine of S$100,000 or five years’ imprisonment or both. So, in comparison to P.R.C, the least time for imprisonment is shorter .But due to the judge’s free power under common law system, the court is increasingly harsh in their sentencing in respect of infringement of copyright. In other words, criminal obligation will become heavier with more limitation in Singapore.
In the contrast with Chinese administrative punishments, Singapore has a large scope of interlocutory remedies to fill in the blank area between civil remedies and criminal sensations, and they are three main types:
(a) the interlocutory injunction---It is an injunction obtained before the trail often with the main objective of maintaining the Stats quo between the parties pending the outcome of the trail. The interlocutory injunction may be in a mandatory or prohibitory form.
(b) the Anton Piller Order---It’s developed from Anton Piller KG v.Mfg Processes Ltd as a safeguard system of evidence for avoiding the defendant to destroy and hide the evidence of copyright infringement, if the plaintiff shows an extremely strong prima facie that his right are being interfered with, or the damage, potential or actual are very serious to the plaintiff, or even there must be clear evidence to proof the defendants faults.
(c) the Norwich Pharmacal Order.---The further expansion of Anton Piller Order to raise over the privilege against self-incrimination from Rank Film Distributors Ltd v. Video Information Centre Virtually . However, case law in Singapore has now established that where the privilege against self-incrimination exists, an undertaking from the plaintiff/ applicant not to use the information obtained in criminal proceedings is not an adequate safeguard for the defendant’s privilege against self-crimination. Singapore courts have also held that they don’t have the power to order that the information be inadmissible in any subsequent criminal prosecution.
Relying on common law foundation, people in Singapore prefer to a lawsuit rather than mediation while more mediation in P.R.C, once in the face of a dispute. Consequently, it would like to be more time and energy consuming somehow, for it costs at least one year of a civil procedure in the High Court of Singapore.
Last but not least, along with legsilation changes, Singapore Administration departments are also mounting a public campaign targeting both consumers and businesses to increase their awareness on the benefits and other implications of the new laws. There’s broad-based public awareness initiatives like the HIP Alliance’s year-long anti-piracy campaign? “The Real thing is the Right thing”, and brain Wave, Singapore’s first reality television show on IP.
(ⅱ)Role of Anti- Piracy Organizations
Both P.R.C and Singapore joined in Business Software Alliance (BSA) ,and WIPO several years ago and established domestic anti-piracy alliances at their own respective locality. The alliances played an active part in combating piracy and protecting the interests of right holders. They always declare laws, promulgate routine reports of current protection on TV, newspapers, and Website and show different points between pirate and authorized products. In the contrast with P.R.C, Singapore has other special disputes resolution organs under its common law system, including the small claims tribunals, E-commerce disputes centre. What’s more, Singapore collaborates with other ASAEN countries to harmonize IP rights with international and regional organizations such as the Office of Harmonization of the Internal Market (OHIM), the European Union, the French National Office of Industrial Property, and IP Australia.
(ⅲ)Introduction of Judgments in Precedent Cases
A) P.R.C
In a landmark verdict on April 16, 1996 against Beijing JuRen Computer, the Beijing No.1 Intermediate Court delivered judgment in favor of the Business Software Alliance (BSA) upholding the plaintiffs' intellectual property rights and ordering the defendant to (a) publicly apologize to the plaintiff; (b) pay over RMB600,000 (US$70,000) in damages, including court costs and accounting costs; (c) pay additional fines directly to the court. The court also ordered the defendant to undertake not to infringe intellectual property rights in the future, and the law enforcement officials to confiscate all computers and software seized during the raid on the defendant's premises. In another case, the same court rendered a judgment against Beijing Giant Computer Co. for software copyright infringement. These were the first cases decided in favor of a US plaintiff in a Chinese court.
国务院办公厅转发国家税务总局关于全面推广应用增值税防伪税控系统意见的通知
国务院办公厅 国家税务总局
国务院办公厅转发国家税务总局关于全面推广应用增值税防伪税控系统意见的通知
国办发(2000)12号
各省、自治区、直辖市人民政府,国务院各部委、各直属机构:
国家税务总局《关于全面推广应用增值税防伪税控系统的意见》已经国务院同意,现转发给你们,请认真贯彻执行。
国务院办公厅
二000年二月十二日
关于全面推广应用增值税防伪税控系统的意见
(国家税务总局 二000年一月二十六日)
增值税防伪税控系统(以下简称:税控系统)是动用数字密码和电子存储技术,强化增值税专用发票防伪功能,实现对增值税一般纳税人税源监控的计算机管理系统,也是国家“金税工程”的重要组成部分。自1994年在部分地区和行业进行税控系统应用试点以来,取得了初步成效。为了进一步加强增值税管理,保障国家税收,防范和严厉打击各种偷、骗增值税等违法犯罪活动,经与有关部门共同研究,现提出如下意见:
一、在2002年年底以前,将税控系统覆盖到所有的增值税一般纳税人。有关企业要按照税务机关的要求及时安装使用税控系统,凡逾期不安装使用的,税务机关停止向其发售增值税专用发票,并收缴其库存未用的增值税专用发票。
二、纳入税控系统管理的企业,必须通过该系统开具增值税专用发票;对使用非税控系统开具增值税专用发票的,税务机关要按照《中华人民共和国发票管理办法》的有关规定进行处罚;对破坏、擅自改动、拆卸税控系统进行偷税的,要依法予以严惩。
三、有关企业取得税控系统开具的增值税专用发票,属于扣税范围的,应按税务机关规定的时限申报认证;凡逾期未申报认证的,一律不得作为扣税凭证,已经抵扣税款的,由税务机关如数追缴,并按《中华人民共和国税收征收管理法》的有关规定进行处罚;凡认证不符的,不得作为扣税凭证,税务机关要查明原因,依法处理。
四、适当减轻企业使用税控系统的经济负担。税控系统专用和通用设备的购置费用准予在企业成本中列支,同时可凭购货发票(增值税专用发票)所注明的增值税税额,计入该企业当期的增值税进项税额。具体办法由国务院有关部门另行制定。
五、税控系统专用设备和技术维护实行国家统一定价,具体标准由国家计委制定。
六、税控系统生产研制单位要确保技术安全和专用设备的质量,做好日常技术维护工作。各级税务机关要对税控系统的销售和售后服务进行严格监督,但自身不得直接或间接从事与其相关的商业性经营活动。