IPR and China – How companies can – How companies can best be protected

Assistance Business Associations European Parliament China Opportunities Challenges Eg: EUCCC; VDMA The Helpdesk Initiative SMEs Protecting Innovation Securing Global Competitiveness

The Helpdesk Initiative European business is 99% SMEs, about 2/3 of employment & about 57-58% of value added (a bit like ratio of Chinese origin goods to all counterfeit seizures….) Definition of SMEs isn't only 'micro-enterprises' (under 10 people) but extends up to 250 employees, so covers more of economy than you might think SMEs tend to assume that IPR is: costly, technical, 'too complicated' and 'not for me' leading them to do even less than they could do otherwise SMEs have fewer resources so need help

Workshop Agenda Why Do Greek Companies Need To Consider IPR? What Do You Need to Protect? How Can Businesses Best be Protected: - Before you start - While doing business with China

Why Do Greek Companies Need To Consider IPR? Trade between Greece & China = US$3.5 billion in 2008 Exports from Greece to China over US$150 million As of November 2008, China is Greeces 30th export market & ranked 3rd for imports Source: Mofcom

Why Do Greek Companies Need To Consider IPR? Mechanical and electrical products - $955 mln Transportation equipment – $608 mln Furniture, toy, miscellaneous products - $427 mln Textile and raw materials - $424 mln Base metal and products – $353 mln Shoes & boots, umbrella and other light industry products - $209 mln Plastics, rubber - $127 mln Pottery, glasses - $123 mln Leather products, boxes and bags – $116 mln Chemical products - $84 mln Wood and wooden products - $55 mln Optics, clocks, medical devices - $54 mln Cellulose pulp, paper - $51 mln Plants - $25 mln Artwork - $22 mln Examples of 2008 Imports to Greece from China:

Why Do Greek Companies Need To Consider IPR? To protect your products & ideas To protect & harness your brands & reputation To justify research & development costs To make sure new rights belong to you To prevent other companies from utilizing your inventions & designs To keep your competitors at a distance To create market space for future development To create a strong defence in case of conflicts / infringement To record unique technology & designs for investors To create a platform for licensing- & co-operation agreements; To create a qualified knowledge base for decisions about registering rights internationally.

What Do You Need To Protect? Brand names Inventions Technology Artistic works Literary works Domain names Designs Software Systems & procedures Know how Trade secrets

How Can Businesses Best Be Protected? How can you minimise the risks? - treat it like your house, bank account, wallet… Issues before you start doing business with China - know before you go While you are there – - Dealing with 3 rd parties - Sourcing - Manufacturing - Licensing - Trade fairs

How Can Businesses Best Be Protected? Issues before you start doing business with China: – Is it registered? – What countries are covered? – What about Chinese versions? – Who are you dealing with? – How do you know if they are reliable?

How Can Businesses Best Be Protected? China is a first-to-file country when it comes to IPR registrations. - Key issue for many EU Businesses – case study China, Hong Kong and Taiwan use separate legal systems, i.e. there is a need to file in both. For trademarks: register broadly in many classes, Chinese versions of your TM should be registered

How Can Businesses Best Be Protected? While you are there: – Contracts/NDAs/confidentiality – notarise agreements – Are they likely to develop your product – what about IPR? – Does your supplier/manufacturer have control of brand labels/moulds/production equipment/proprietary information? – Assess risks – who else does supplier work for; is there a conflict?

Case study: Great idea – poorly executed…

How Can Businesses Best Be Protected? Consider how you want the relationship to work and what controls you need to put in place to secure your rights Conditions should be put into a written agreement and accurately translated and understood by all parties Take steps to verify that your potential business partner are genuine and share the same goals as you If possible, consider keeping your most valuable IP a trade secret, for example, the formula for Coca-cola. Business partners and IPR protection

How Can Businesses Best Be Protected? Consider what samples and promotional materials you provide to potential partners Ensure that your property is protected after an agreement has ended e.g. include the return of moulds within the written agreement Clearly state what Intellectual Property Rights are owned by whom in respect any items you supplied Use confidentiality, non-competition and non-disclosure agreements Specifically state that your supplier may NOT use a sub- supplier without your permission Business partners and IPR protection

Summary Register rights – if you dont own it you cant protect it You need to be the first to file IPR in China Use good contracts Prevention better than cure Be proactive Next – Ways to deal with Infringement/Counterfeiting…