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IPR violators deemed major criminals
By Cui Ning (China Daily)
Updated: 2004-12-22 01:02

Effective from today, Chinese courts will treat infringement on intellectual property rights (IPR) as a major criminal offense rather than a minor one.

The threshholds for IPR offense punishments are also lowered in a judicial interpretation jointly announced by the Supreme People's Court and the Supreme People's Procuratorate in Beijing yesterday.

The interpretation, with 17 articles, will make it easier to prosecute IPR violations and give out tougher sentences to offenders, said Cao Jianming, vice-president of the Supreme Court, at a news conference held by the State Council's Information Office.

The first seven articles on the interpretation list the criteria for conviction and sentencing on the seven major IPR violations stipulated in China's Criminal Law. They are: counterfeiting registered trademarks, selling counterfeit trademarks, illegally producing or selling registered trade marks, violating copyrights, forging patents, breaching business secrets and selling pirated products.

These articles aim to redress the complaints that the legislation is short on guidelines and applicability because it is made up of general principles only, said Cao.

The new interpretation has lowered the threshold of the financial gauge by which a violator may be punished. When a business brings in a minimum of 50,000 yuan (US$6,024) in revenue or 30,000 yuan (US$3,600) in illegal gains from selling counterfeit goods or infringing on copyrights, it will be eligible for criminal penalties.

Compared with the previous standard of 100,000 yuan (US$12,000) to 200,000 yuan (US$24,000) as a minimum, the harsher guidelines are expected to deal a heavier blow, said Zhang Geng, deputy-procurator-general of the Supreme People's Procuratorate.

The offense of selling counterfeits with a volume of lesser than 50,000 yuan (US$6,024) will be punished through administrative means, said Cao. China has a dual system of judicial and administrative protection when it comes to IPR.

Under the new interpretation, offenders who knowingly sell fake trade-marked goods will receive a minimum sentence of three years and a maximum of seven years, once the sales volume exceeds 250,000 yuan (US$30,000).

The interpretation will also apply to online piracy, said Cao.

"It is necessary for China to protect IPR in order to fulfil its international commitments and create a favourable climate for foreign investment," said Cao. "Moreover, it can help regulate the country's own market order and propel technological innovation to sustain economic development."

Courts at all levels will tighten punishments accordingly, he said. Courts have been paying more attention to IPR violations in recent years, he added.

Since 2000, courts nationwide have completed prosecution of 1,710 IPR cases and meted out penalties to 1,948 offenders.

Meanwhile, the Supreme People's Procuratorate has been committing itself to helping fight IPR violations, said Zhang.

Since 2000, procuratorates at all levels have approved 2,462 arrests in 1,539 criminal cases involving IPR infringement, according to Zhang.

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