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GM Daewoo files suit against Chery
By Liu Li (China Daily)
Updated: 2005-05-09 06:23

The General Motors (GM) Daewoo auto firm is suing a Chinese car manufacturer for allegedly copying one of its vehicles.

Sources with the Beijing No 1 Intermediate People's Court confirmed yesterday that the court has accepted a lawsuit filed by General Motors (GM) Daewoo against China's Chery Automobile Company.

GM is asking for compensation of 80 million yuan (US$9.6 million).

GM Daewoo contends that Chery's mini car QQ copied its Matiz and Spark.

Chery denies this, saying it developed QQ on its own.

The South Korean plaintiff initially began suing the Chinese auto maker in December last year at the Shanghai No 2 Intermediate People's Court.

However, the defendant objected on jurisdiction grounds. The Supreme People's Court appointed the Beijing-based court to handle the case, sources in the press office of the Beijing No 1 Intermediate People's Court told China Daily yesterday.

Produced by GM Daewoo, the Matiz went on the South Korean market in 1998, according to the bill of indictment.

GM Daewoo authorized the Shanghai Automotive Industry Corporation in 2003 to produce and sell the Spark on the Chinese mainland on the basis of the design and technology of the Matiz.

However, GM Daewoo claimed their investigation results showed the Chery QQ shared a remarkably identical body structure, exterior design, interior design and key components.

"Chery even used a camouflaged Matiz car to pass auto tests to acquire authorization from the government over production and sales of QQ," the plaintiff said.

GM Daewoo claimed the behaviour of Chery had resulted in unfair competition.

A press official surnamed Zhang at the Chery headquarters in East China's Anhui Province told the Beijing Youth Daily that they had not been told of any developments regarding the accusation, the Beijing Youth Daily reported.

However, sources with the Chinese automaker insisted that Chery depends on itself for development, instead of copying other firms.

Eight months ago, Zhang Zhigang, vice-minister of commerce, said Chery's alleged infringement and unfair competitive behaviour could not be determined according to the Chinese law and evidence provided by GM Daewoo.

Zhang Qin, vice-director of the State Intellectual Property Office, also said at a press conference in September that GM Daewoo failed to apply for a patent on its designs in China. Thus, the technology was not protected in China according to the law.

The official also said that only when GM Daewoo had provided sufficient evidence to prove that Chery stole statistics from it could the alleged infringement exist, despite the similarities between the two cars.

"Domestic car firms should invent their own products, instead of copying others," Jia Xinguang, chief analyst with the China Automotive Industry Consulting and Development Corp, said yesterday in an interview with China Daily.

(China Daily 05/09/2005 page3)

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