What Will the Internet Plus Bring Us?
By Cong Lixian
Updated: 2015-09-11

During the Two Sessions in 2015, the government work report announced the Internet Plus action plan, marking the rise of the “Internet Plus industry” as a national development strategy. In the Internet Plus era, the combination of the Internet and IP will give rise to an in-depth integration of new economy, new technologies, new industries and new institutions, and promote great productivity. The Internet means technological innovation, industrial updates and developments, and updates on Internet technologies will impact, or even overturn, the existing pattern of interests of traditional industries. The IP has both systematic attributes and economic attributes. The systematic attributes comply with and regulate economic development, and economic attributes influence and determine the selection of systems. In the Internet Plus era, the game and redistribution has been increasingly apparent among different stakeholders in the IP industry. The Internet Plus IP will bring a great deal of opportunities and challenges, which include birth of new industries with the Internet as a carrier and the IP at the core, transformation of economic growth modes with innovative economy at the core, and implementation of market economy rules with new models and regulations at the core.

Interpretation of Internet Plus IP

Internet Plus IP is one of the most typical combinations which mark not only a connection of technology and industry, but also of industry and the system. As we all know, the birth and development of the IP system is inseparable from technological innovations. Over 300 years’ history of the world IP system is also the evolving history of technological innovations of the human society. In terms of technological revolution through the information society, human society has experienced three revolutionary eras of information technology over the 300 years: printing and typography, sound and light transmission technologies and the Internet. The Internet IT era has just started. With the in-depth integration of Internet and IP, the Internet will, as what the IP has done, make a significant and unimaginable contribution to the human society.

The practical urge for speedy updates on Internet technologies lies in economic benefits, and the IP system, as a social and legal system, pursues fairness and justice in the generation and distribution of IP interests. In the Internet Plus IP era, what kind of regulations and rules, from the macro perspective, will the Internet industry and IP industry really need to select: a preset regulation mode or active followup regulation mode? In general, technology and law are naturally related: preceding technological development will lead the way in the overall development; backed by law and regulations, reasonable systematic arrangements may help to achieve scientific allocation of interests. As long as the interests pattern is not out of control, free development of technologies should be encouraged to its utmost. The adjusting functions of laws and regulations will begin to work if the basic industrial form and attributes are in place. It is certain that in the development of technology-driven industries and trades, if the sprawling growth pattern is adopted, the existing rules and regulations will be undermined subversively, giving rise to confrontation between emerging industries and traditional ones. From this perspective, in the Internet Plus IP era, the premise for the protection of the Internet industry and the IP industry is to maintain the balance between the basic purpose and rules of IP law, which is also the essential requirement for the technical innovation and protection of business models.

Selection of Internet Plus IP Rules

In the new forms of trade and industry, it is particularly necessary to further improve Internet IP rules. The IP system is the most internationalized legal department, and no country can be insulated and completely independent from international IP system. A country’s ultimate purpose of its IP system is to protect its local interests, but keeping abreast of international standards is also a necessary policy orientation. In the era of Internet Plus IP, the internationalization of IP system is at the crossroads of reform: various forms of international cooperation, such as bilateral international IP protection, multilateral international IP protection and plurilateral international IP protection, will not be able to cover up the confrontation resulting from uneven development. On the one hand, the United States, Europe, Japan and other developed economies pursue unilaterally recognized high standards of IP system; on the other hand, China, India , Brazil and other large developing economies want to maintain the balance of the existing international order, while other countries which have relatively weak or trivial interests do not show much interest. A country’s establishment of Internet IP system and rules should agree with the local level of industrial development, and promotion of its localized rules should be in line with the internationalized rules, namely, compatible with the reasonable and orderly rules of the international community, which is a coordination of internationalization and localization. And the essence lies in the adjustment of localization to fit in with internationalization.

The formation and maintenance of “Chinese characteristics” of China’s Internet IP should go in line with international perspectives, achieve and maintain progressiveness conducive to protection of national interests. The first is to achieve standardization of the judicial protection of Internet IP, which should be the most important way of Internet IP protection. Because of the novelty and complexity of practical cases and issues in the judicial protection of Internet IP, it is substantially important to maintain the standardization of judicial protection, which includes standardized and unified protection rules in procedures and substantive rights. The second is to build a new normal of law enforcement in IP protection. With the fast development of Internet Plus trade and industry, it has been more prominent over confrontation and coordination between the increasingly stronger economic form and governmental administration and enforcement. Therefore, it is advisable to avoid “campaign-style law enforcement” in the Internet IP protection, stick to fundamental ideas and principles of “right to personal autonomy” in Internet IP, and further improve the legislative basis and procedural rules of Internet IP enforcement. The third is to enhance IP management and service level of the trade and industry. The importance of IP for enterprises can be seen from the following figures: in 2014, China registered over 2.1 million trademarks, over 2.4 million patent applications and over 1.2 million copyright pieces, an increase of 30% year on year. The fourth is to make full use of the Internet innovative thinking to further strengthen IP innovation management, enhance innovation service levels of the industry and truly realize upgrades on the trade and industry.

Under the new normal of Internet Plus IP, it is particularly important to adjust and modify specific Internet IP rules. The updates on Internet technologies and industrial development have brought about profound changes to the economic, social and cultural fields. In the rapidly changing new environment, it is difficult for some traditional IP rules to effectively solve emerging problems in emerging fields. For example, the protection objects of Internet IP have gone beyond the protection scope set by the traditional IP law, and it has been quite difficult for the listing methods adopted in China’s basic IP legislation to effectively respond to new changes. Another example is the chaos of rules and regulations in the protection scope of rights of the Internet IP, caused by an overlook of the essence of their property and personal attributes in designing the Internet IP rights on the basis of traditional approaches. Traditional rules over limitation of rights have been completely unable to take care of new issues of the Internet IP; therefore, there is an urgent need to adopt fundamental provisions of the Berne Convention and other international conventions. We should also consider how to extend the use and management of rights to the internet, so as to promote digital network utilization and management modes. In addition, the chaos also exists in the provisions over determination of Internet IP infringement and legal remedies. Also, there are contradictions in the co-existence of civil law and common law. Thus, relevant rules demand urgent clarification. The designing of the dispute resolution mechanism should consider requirements of the Internet Plus IP and make the alternative dispute resolutions (ADR) legal and applicable.

International References of Internet Plus IP

There is no doubt that the US is a winner and beneficiary in the Internet Plus IP era. Its Internet IP industry and rules are considerably scientific and worthy of a reference. The success of US Internet Plus IP mainly lies in its legislative orientation and selection of rules. The Digital Millennium Copyright Act (DMCA) has been a great driving force for the development of the US Internet copyright industry which has vigorously promoted passage of the two bills against online copyright infringement, namely, the Stop Online Piracy Act (SOPA) and the Protect IP Act (PIPA). Although the bills failed to be approved, they are meaningful in advocating rules for the US Internet industry. Currently, the US is striving to accelerate negotiations over the Trans Pacific Partnership (TTP) and the EU/US Transatlantic Trade and Investment Partnership (TTIP), in which provisions over the Internet IP are far beyond the protection standards set down in The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). They go in line with the basic localized protection level of Internet IP in the United States with the view of paving the way for the internationalization of the US Internet Plus IP strategies. In addition to the above acts and international agreements, the success of US Internet Plus IP is also reflected in the basic adjudicating rules from the professional court system, such as the principles of technology neutrality, safe-harbor and red flag standard and server standard, which are very conducive to the settling of Internet IP disputes.

In addition to the United States, other relatively developed regions and countries also have some experience in Internet IP protection which can be drawn on. The EU has been very active to push the industrial development by approving a series of rules and directives regarding digital and Internet IP protection. The latest action plan to combat IP infringement has expanded to the Internet IP infringement and is concerned about strategies to protect and implement the EU Internet IP in a third country. Japan, which enjoys a high level of IP protection on the Internet, is the first country to ratify the Anti-Counterfeiting Trade Agreement (ACTA), and also an important partner and supporter of US-led TPP. Japan advocates a comprehensive strengthening of the Internet IP protection and has made many modifications to the basic IP laws, such as Copyright Act, Patent Act and Trademark Act, in response to the digital network IP protection. Japan has launched an action plan to develop IP strategies, made efforts to strengthen the supervision on illegal uploading of films, animations, games, music, business Internet software, and other works and goods, and push the implementation of criminal protection rules of the Internet IP. In order to meet the actual requirements of Internet IP protection and promote the development of the internet industry, Singapore, likewise, has approved the amendment to Copyright Law which grants the rights holders the right to apply for court injunctions, and forces Internet service providers to block allegedly infringing websites or delete infringing web pages.

Comparatively speaking, China still lags behind in the implementation of Internet IP strategies and structuring of rules thereof, failing to keep pace with the booming Internet industry and IP industry. The notorious drawback lies in the relatively low efficiency and quality in amending the basic IP law and related regulations. Among them, China Copyright Law, as a representative basic law of the Internet IP protection, has lagged significantly behind in its revising and improving. China Copyright Law, since its enactment in 1990, has been amended twice, basically under pressure from the United States. Only the first amendment basically satisfied the actual needs of the social and economical development at that time. The second amendment was made to respond to unfavorable consequences under the WTO against the United States, only modifying a provision regarding copyright of prohibited works and adding a provision regarding pledge of rights. Therefore, it is an urgent task for the time being to realize truly independent and systematic amendments to the copyright law and effectively take on the profound challenges arising from the Internet Plus IP. According to statistics, our neighbors, Japan, South Korea and Singapore have made 35, 17 and 7 amendments to their copyright acts so far.

In all, in the Internet Plus IP era, the development and optimization of the industry, building of a system, and designing of rules are all based on the practical needs of the essential attributes of the Internet IP. The starting point of the Internet IP protection is effective realization of protection, utilization and remedies of IP rights. In the context of the Internet Plus IP, we should coordinate the traditional IP rules with the Internet IP rules, so as to avoid, as much as possible, conflicts of interests, and to reduce systematic costs of policies and rules. We should also think about how to go beyond the traditional IP rules, make necessary adjustments and provisions to mature Internet IP rules, reconsider responsibilities of Internet service providers over copyright and related rights, improve the graphical user interface (GUI) design and patent systems regarding software patents and business method patents, and explore specific issues related to the Internet trademark protection, such as new top domains, network service name and service accounts. Only when scientific arrangements, rule designing, policy selection and strategy implementation meet the practical needs of the Internet Plus IP, can national development strategies be truly implemented in practice.

(Translated by Wang Hongjun)

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