CHINA has been working hard to tighten its copyright laws in advance of this month's deadline, set by the United States, for it to take effective measures or face retaliation. That much is clear from the tone of the White Paper on intellectual property released yesterday, despite the lack of detail on what new measures it is planning to introduce.
Although the paper is defensive, given Washington's label of one of the worst violators of US copyrights and the threat of imminent sanctions, China clearly also feels it has a positive story to tell. It is not only US pressure which has pushed Beijing into improving its legal framework but the wish to enter the General Agreement on Tariffs and Trade (GATT) as early as possible. To do so, and to attract the foreign enterprises wary of further investment for fear of finding their products faked, China needs intellectual property protection to meet international standards.
Unfortunately, while there have been great strides in China's performance lately, the experience of many foreign companies is still that the fakes start appearing almost as soon as the product is launched on the Chinese market. No matter how good the laws may have been in theory, China has immense problems in enforcing them. The White Paper cites statistics to show how many prosecutions and promises any individual or organisation can now receive ''practical and effective judicial protection''. In areas where the local authorities have the will to prosecute, that may be true. In others, the protection may be more theoretical than real. Moreover, as the American software producer Microsoft discovered to its cost, offenders can sometimes get off lightly. Microsoft has complained that it has lost more than US$20 billion (about HK$150 billion) through piracy in China, yet an official Chinese research institute found guilty of manufacturing holograms used in pirating Microsoft material was fined US$250.
It remains to be seen, however, whether foreign firms operating in China will notice any dramatic improvements in the coming months following the publication of the White Paper. For the sake of improved trading relations with the developed world, particularly with those countries with the funds and products to offer investment and transfer of technology, China needs cast-iron, enforceable intellectual property protection. That means there must be more improvement in practice before the United States, the GATT and the international business community can treat China's claims of a ''high grade legal system'' to protect intellectual property less sceptically.
