Founder of law firm provides IP advice to companies looking to do business in China.
In an article on law website Above the Law, Dan Harris, founding member of international law firm Harris Moure, outlines the hazards of doing business in China in terms of patent infringement and counterfeiting, providing tips on how companies can protect themselves from these issues.
Harris begins by stating that “if you sell or outsource your products to China, you should anticipate infringement of your trademarks, copyrights, patents, or trade secrets, and have an anti-counterfeiting/misappropriation plan in place before that happens”.
Such a plan should involve the company protecting its IP rights by registering trademarks, patents and industrial designs in China, although Harris adds that “copyrights do not need to be registered to be protected, but registration will make it easier for you to prove ownership of your copyright in any dispute”.
Meanwhile, trade secrets, which cannot be registered, can be protected by taking measures such as using a “Non-Disclosure, Non-Use and Non-Circumvention (NNN) agreement written specifically for China” if planning to disclose a trade secret to a prospective Chinese partner. This is because while “US-style NDA Agreements” are “pretty much worthless” in this scenario, “China-appropriate NNN agreements can be quite effective at deterring Chinese manufacturers from copying your products”.
Registering IP both in countries in which products are being sold and in which they are manufactured is also important, according to Harris, who adds that “to further protect your IP in China, it typically makes sense for you to submit your IP registrations to the Chinese customs authority so that it will have a strong evidentiary basis for seizing infringing products”.
Finally, Harris emphasises the importance of establishing “good relations with government, law enforcement, and political organisations at the national, provincial, and local levels” in the first instance, before any need for assistance in dealing with stolen IP. However, he adds that it is important to ensure “anti-bribery laws of either China or your home country, or the country in which you conduct business” are not violated.