International property rights and China

International property rights (IPR) violation is a widespread and entrenched phenomenon in China because of several factors. China's rocky transition from a centralized economic system to capitalism has provided a rife environment for piracy to flourish in the "gray" market. In addition to the fact that the lucrative nature of the business provides tremendous incentive for the suppliers to engage in piracy, the Chinese consumers constitute the other half of the problem. Although they are impressed by the dazzling array of products offered by America, such as the music, films and computer software, they can ill afford the prices of the legitimate products; therefore, they turn to pirated copies. Furthermore, the absence of a legal and enforcement system to uphold IPR in China further cultivates the presence of piracy. From another perspective, the strict quota China imposes on foreign products also encourages consumers to turn to pirated products for greater choice. However, other writers, such as Madeleine Albright and Robert Senser, believe that the causes of IPR violation described above are only symptoms of a larger problem the Communist system that continues to govern the way of life in China.

Beyond the periphery of the state-controlled sectors that sells limited selection of products lies a vibrant "gray" market. It is supplied by 26 CD and laser disc factories in central and southern China, producing 50 million pirated CDs annually even for export to Taiwan and Sou

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reater manpower is needed to set up separate task forces ("Making War" 33). In addition, the official agents are often uneducated about the intellectual property they are supposed to protect. According to Alix Parlour Grice, a lawyer with Microsoft in Hong Kong, lawyers and software engineers from foreign companies need to accompany official agents because some of them have never even seen a computer before (Moffatt). On the other hand, IPR violators are extremely vigilant to the enforcement actions of the facilities. When they anticipate a police raid, they temporarily halt production. Furthermore, they often move their operations to areas where enforcement is lax. Violators unite in their efforts to protect their livelihood by setting up a common fund to pay IPR fines and even threaten the lives of enforcement officials (Deng et al. 46). In 1996, an antipiracy office in Guangzhou was closed down because of threats by hitmen hired by the local violators. Many of these violators are not fearful of official intervention because they have connections with the People's Liberation Army and the local officials (Moffat). Thus, official enforcement in reducing the production of pirated products is hampered by internal corruption.

Category: Foreign -