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Increase in lawsuits spurs new cooperation

Published on 05/04 2017  Source: China Daily


Challenges in seeing cases through the courts lead industry insiders to recommend greater and deeper coordination

Experts and entrepreneurs have called for closer cooperation among law enforcement agencies, improved identification mechanisms and higher punishments in trade secrets disputes, as trade secrets become increasingly important as intellectual property is vital to companies' market competition.

They made the remarks at the High-level Forum on China IP Protection held late last month in Beijing.

Chen Hongbing, chief of the World Intellectual Property Organization's China office, said the number of lawsuits involving trade secrets has risen rapidly in recent years in China.

"Trade secrets show the innovators' essential competitiveness and capabilities, and are their core assets," Chen said.

Song Lihong, professor at the People's Public Security University of China, said despite the large number of trade secrets complaints, only a small portion of them can be registered with the police, and even fewer can be solved.

He said the challenges in such cases include collecting evidence and identifying actual losses, as well as protectionism.

"To improve investigation efficiency, the police, prosecutors and courts should have closer coordination and jointly issue a series of guidelines," Song said. "They should also compile detailed identification rules and recognize qualified identification agencies."

He also called for increased compensation and stronger public awareness for trade secrets.

Liu Xuanmiao, chairman of e-commerce company FTXMall in Mianyang, Sichuan province, echoed Song's comments.

"According to the related laws, trade secrets refer to practical information not generally known by others, from which a company can obtain economic advantages over its competitors," Liu said. "In practice, however, it is subjective to judge if the information is practical and if the rights owner can obtain economic advantages from it."

He suggested introducing specialized teams into law enforcement authorities. He said ordinary departments may have insufficient professional knowledge about competition and illegal behaviors in some specific businesses, causing delays when judging circumstances.

"The delay is often fatal to e-commerce companies," he said.

In common practices, when a case involves both civil disputes and criminal behavior, criminal penalties usually come prior to civil punishment. But Zhang Ping, a law professor at Peking University, said in IP cases, especially in those involving trade secrets, civil methods should come first.

"Trade secret disputes are mostly about market behaviors and public power is abused when it intervenes in market competition," said Zhang.

Chen Hongbing from WIPO's China office called for "reasonable doses" of IP protection. "Overprotection and abuse of the IP system will lead to unfair competition," he said.