While the Economic Cooperation Framework Agreement signed by Taiwan and mainland China June 29 has generated some controversy over the issue of Taiwan’s sovereignty, few people have voiced similar objections to the simultaneously inked agreement on intellectual property rights protection, which is as important as the ECFA in the ongoing effort to develop Taiwan’s business sector.
The deal calls for both Taipei and Beijing to cooperate on IPR-related issues and grant each other priority rights to ensure proper protection of patents, trademarks, copyrights and plant variety rights originating from both sides of the Taiwan Strait.
“IPR protection is always one of the priorities in cross-border trade, as it is vital to safeguarding a nation’s innovative capabilities and business interests,” said Wang Mei-hua, director-general of the Intellectual Property Office (TIPO) under the Ministry of Economic Affairs, during an interview with Taiwan Today July 8.
Increasing cross-strait exchanges, as well as the fact that the two sides share the same language and cultural heritage, have given rise to numerous problems relating to IPR protection, said Wang, who was also Taiwan’s chief negotiator on IPR when the pact was being discussed with the mainland.
Some of these problems include product counterfeiting, copyright infringements, patent defense and false product labeling. For example, pirated copies on the mainland of Taiwan’s 2010 blockbuster “Monga” caused the movie an estimated loss of NT$100 million (US$3.11 million) in box office revenues.
“Against this backdrop, the matter has become even more pressing than before,” the official pointed out.
Asked to describe why the government was so keen on pushing the IPR agreement, Wang explained: “As Taiwan is the mainland’s seventh largest trading partner and fifth largest investor, we believe it is necessary to establish an agency-to-agency mechanism to provide direct, effective and immediate resolution of IPR disputes.”
Over the past five years, Taiwan-based companies have filed a total of 109,510 patent and 44,789 trademark applications with mainland authorities, Wang noted. By contrast, mainland firms have only filed a fraction of such applications with the TIPO in Taiwan, she added.
“While the agreement aims to uphold the IPR of people on both sides, it is clear that the mainland will have to do a lot more in terms of law enforcement, while Taiwan will be the greater beneficiary as a result,” the official said.
Nonetheless, mainland authorities demonstrated a high level of commitment during the negotiation process. “This is evidenced by the fact that the cross-strait agreement is about both IPR protection and cooperation, while the deals mainland China signed with other countries only involved cooperation,” she explained.
Moreover, the Taipei-Beijing accord outlines specific measures to be taken when addressing disputes over infringements. Both sides also agree to exchange information and notify each other of investigation results. “This is certainly a good sign to future cross-strait dealings,” the TIPO head added.
With a communication platform in place to settle disagreements and ensure IPR protection, firms from Taiwan can seek to recover famous trademarks preemptively registered by mainlanders and crack down on cross-border copyright violations and false claims of product origins, she explained. “Of course, we will provide the same, if not higher, level of protection to mainland businesses.”
Despite this mutual understanding, the TIPO chief revealed that both sides proceeded with great caution when it came to discussing the reciprocal granting of priority rights—which give applicants for a patent or trademark in one country priority rights in filing the same application in another country within a certain time limit.
In the case of the cross-strait IPR agreement, the two sides agreed to grant each other a one-year time limit for patents, and a six-month limit for trademarks.
“Priority rights are especially critical to industries that rely heavily on research and development. Firms in other sectors will also benefit, because this will prevent the illegitimate pre-empting of trademark registrations on the mainland,” Wang said by way of explaining the significance of this breakthrough in the cross-strait IPR dealings.
According to the director-general, Taiwan’s proven track record in IPR protection is the major reason mainland authorities were willing to join forces with Taiwan.
“We have come a long way in this regard,” Wang said. Over the years, the government has enacted a set of well-defined regulations governing IPR protection, with satisfactory implementation results.
For example, the IPR Police Team, created in January 2003, is a dedicated law enforcement body commissioned to clamp down on IPR violations. The establishment of Taiwan’s IP court in 2008 represents another step forward in this regard. “We take the matter of IPR protection very seriously.”
While strict law enforcement has proven effective in deterring wrongdoing, “more important is the general public’s high sense of civic responsibility, which greatly facilitates the government’s work toward this end,” the TIPO chief added. Wang noted that thanks to the country’s collective efforts, in 2009 Taiwan was removed from the U.S. Special 301 Watch List—inclusion in which usually indicates that a country does not protect intellectual property rights vigorously enough.
With the cross-strait agreement a done deal, the TIPO is ready to embark on other urgent tasks, including tackling the huge backlog of more than 140,000 patent applications, which may need as many as seven years to process.
It takes an average of 36 months for the TIPO to handle a patent application, while the time required by South Korean authorities is less than 18 months, the official noted. “This is certainly a problem, and will definitely put a drag on local firms’ competitiveness.” It is also a great impediment to the state’s policy of turning patents and innovations into profitable ventures, or a “smart industry.”
The good news is that the Executive Yuan has approved a budget proposal that will allow TIPO to add manpower to its review committee in the second half of the year. “We hope to cut the processing time to around 20 months, which is more in line with the global norm,” she said. (HZW)
Write to Meg Chang at meg.chang@mail.gio.gov.tw