A number of bureaucratic brick walls across Taiwan's legal system continue to hamper foreign firms attempting to protect their intellectual property in local courts, according to a foreign business group.
Long procedural delays, apparent bias against foreign firms and no legal mechanism that can reach into China's counterfeit havens where Taiwanese-operated firms pump out pirated goods are just some of the major issues raised by a recent meeting of the European Chamber of Commerce Taipei's intellectual property rights (IPR) committee.
When presenting an intellectual property violation case before the court, foreign firms have to provide a complex series of documents proving the validity of their legal representation, wasting both time and money, according to John Eastwood, co-chair of the committee.
"It is a very serious problem when they're asking for documents to be notarized, and legalized ... and the original copies shuttled back and forth between Taiwan and Europe, Taiwan and the United States," said Eastwood, who is also of counsel with Qi Lin International Law Offices (齊麟國際法律事務所).
Lawyers for Taiwanese companies are virtually exempt from this problem as -- unlike their foreign counterparts -- they need only present the company "chops" of their employer for verification, said Danny Lin (
Foreign firms however are required to provide notarized and legalized power of attorney documents, sometimes signed by the chairman of the company.
"It means that when intellectual property right owners find out that there's a factory producing counterfeits, it means that they can't act as quickly ... this is just a huge dance that people go through to try and protect their intellectual property rights in this country," Eastwood said.
`Special 301'
This issue, although seemingly small, has been a consistent thorn in the side of foreign firms in Taiwan, but has grown to take on added significance as the United States Trade Representative Office includes Taiwan in its evaluation of placement on its "special 301 watch list" of serious IPR violators, he said.
Taiwan officials have reportedly urged the US government not to include Taiwan on the list again this year, which is scheduled for release next month, claiming significant efforts have been made to improve IPR protection.
"It affects all of us. It's high time that they really started looking to fix [the problem] because it does affect national treatment ... [which is] the obligation under the WTO and TRIPS [Agreement on Trade-Related Aspects of Intellectual Property Rights] that foreign companies operating in Taiwan receive the same sort of treatment that local companies get," Eastwood said.
Bias against foreign firms -- whether intended or not -- also seems apparent in recent legislation that decriminalized IPR violations. Last October the legislature made amendments to the Patent Law (專利法) decriminalizing infringement of invention patents but leaving the criminal punishments unchanged for violations of new utility models and design patents.
Reduced protection
However, shifting the burden of investigation and meting out punishment to the relatively toothless civil code reduces IPR protection for foreign firms.
"The failure to enhance civil discovery procedures and increase civil damages significantly reduces the already poor protection for IP owners," an ECCT white paper on the subject said.
"If we look at it very closely, we notice that the only thing that was decriminalized was infringement against the new invention rather than the patent of the new design," Lin said.
"We don't know the reason behind it ...we can only guess that it is because the patent holders of new inventions are mainly from overseas," he added.
Hardly a good start for a year during which the government vowed to get tough on IPR.
According to Laurent Gaborit, of Cartier Taiwan Ltd, the level of punishment is simply not an effective deterrent.
"In terms of counterfeiting in general, it seems the problem with the legislation is that the punishments are not severe enough," Gaborit said. "We need to have some stronger political willingness in Taiwan to help us with this problem," he added.
Another area of IPR protection which will require serious government action -- if not an act of God -- is the establishment of legal channels across the Strait through which to pursue violators that are based in Taiwan but operate out of China where they are virtually immune from prosecution.
"Cross-border issues affect nearly all industries," Eastwood said. "It would help enforcement to start working towards setting standards for accepting documents coming in from the mainland to pursue criminal and civil actions against infringers running businesses out of Taiwan that operate in the PRC and elsewhere," he said.
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