ChinglishFriend

The past two weeks have seen an interesting assortment of IPR developments. In a fresh installment of what seems to be the never-ending saga of the Silk Street market, enforcement authorities raided the shoe department this past weekend and confiscated every counterfeit Nike and Adidas product they found.

The Beijing Administration of Industry and Commerce's (AIC) trademark office claims to have adopted a new methodology, in that it conducted the raid on its own initiative, without waiting for a formal complaint from the trademark owners. If that's the case, it's worth asking why the raid exclusively targeted Nike and Adidas products.

In any event, by targeting only one or two brands, the AIC hasn't broken new ground. The Chinese government has consistently proved itself able to purge counterfeits of specific trademarks (for example, the Olympic rings), but remains incapable of tackling the problem of counterfeiting as a whole.

And despite the limitations of the Chinese government's "one at a time" approach, the American movie industry seems to have adopted it. As Caijing observed, American IPR rights holders have switched tactics, from pressuring the Chinese government to do their bidding on IPR, to suing individual infringers.

In Beijing, five Hollywood movie studios have sued two stores for having sold a total of sixteen counterfeit copies of War of the Worlds. Although the two stores lost the suit, neither complied with the court's judgment. The studios went back to court last week for an enforcement order.

Meanwhile, in Shanghai, seven Hollywood studios have filed their third consecutive suit against the same proprietor of counterfeit DVDs.

What these developments suggest is that enforcement efforts targeted only to one trademark or to one sales outlet are a waste. The gains from the periodic raids on Silk Street are temporary at best. As the Beijing Youth Daily pointed out, counterfeit goods disappear during the raids and reappear after a short hiatus. And the utility of private lawsuits against individual vendors is questionable. An operational court system — in a society that respects and abides by the court's judgments — is a prerequisite for the success of IPR enforcement through private litigation. The movie companies won't find that in China.

A meaningful anti-counterfeiting campaign in China must go up the supply chain and shut down the factories producing the counterfeits and/or throttle the distribution channels through which counterfeits move. The odds of such an approach being implemented in China are exceedingly small. Local protectionism, corruption and the inefficiencies inherent in any large-scale inter-agency enforcement effort make unlikely any attack on the supply chains for counterfeit goods.

So what's left? Counterfeiting might disappear from China if manufacturers valued the production of original work over copying and product quality over profits-at-any-cost. But on the question of IPR-related values, China and the US are still worlds apart.