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China proposes higher fines for IP violations

We've written in the past about efforts Chinese officials have made in curbing intellectual property violations. Yet preventing trade secret theft has proven to be no easy task.

To begin with, the problem is complex and seemingly widespread. And as one international publication concludes, trade dispute issues go well beyond intellectual property concerns. It's just that trade secret violations have become the trade war's focal point.

Increasing fines concerning violations

It's likely there will be increased fines for IP violations. A draft of the newly proposed laws is now in the hands of the Standing Committee of the National People's Congress.

The Straits Time quotes China's head of the State Intellectual Property Office concerning the intent of such legislation. "The draft is meant to solve new patent problems, such as difficulties in collecting evidence in patent lawsuits, online IP infringement and low compensation for victims of patent infringement."

The legislation raises minimum and maximum fines significantly. The previous range for fines was between 10,000 to 1 million yuan. Under the proposed laws: the fines would range from 100,000 yuan to 5 million yuan. One lawyer feels such an increase will increase protections concerning the rights of patent owners.

Also, this legislation serves to make establishing the amounts of fines easier in such cases. Patent holders will play a greater role in court concerning rulings on the appropriate fine.

Stronger intellectual property protection in China will result in more innovation, and this will give American companies more incentive for doing business there. It will be necessary, however, for such companies to have on their side someone who understands the intellectual property laws. Whatever protections China puts in place, the laws will be difficult to understand. To not seek legal advice means companies will risk placing their intellectual property at risk.

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