Chinese Rights Owners Seek Payment For Mobile Telephone Use

December 2003

Record Labels, Music Publishers, Telecommunications

The Music Copyright Society of China is seeking US$1.4 million, from China’s second biggest mobile phone operator, TCL Mobile Communication and its distributor, Beijing Digital Electronic Communication Technology, for installing 107 copyrighted Chinese tunes on 12 TCL models. TCL has offered to pay only about a quarter of the damages. A court ruling is pending after a hearing last week in Beijing. China, which is plagued by pirated CDs and DVDs which are on sale on street corners shortly after first release has vowed to crack down on copycats and strengthen intellectual property protection after the country joined the World Trade Organization two years ago. Chinese copyright laws do not specify how much cellphone makers should pay when they include copyright material. “Butterfly Lovers Concerto,” based on a Chinese tragic love story, and “Full Moon of the Fifteenth,” are among the most popular among Chinese cellphone users. China overtook the United States as the world’s biggest cellular market last year. With 244 million users at the end of August. The Chinese copyright owners have demanded 1.4 U.S. cents, for every tune installed on a phone and the dispute is really about how much TCL will have to pay not whether they should pay at all.

But in a separate report, Korean firms have said that they face growing copyright piracy from and in China. The Korea Trade-Investment Promotion Agency urged the government and private companies to be better prepared against copyright infringement in the most populous nation. KOTRA have said that they appreciate that the “Chinese government has toughened regulations against copyright infringement since its entry into the WTO” but China is “still a long way off from eradicating piracy”. In particular, KOTRA are worried about copyright infringement, trade mark infringement, patent infringement and other infringements of Korean Intellectual Properties in their huge neighbour. One problem is Chinese companies using South Korean brand names and trade marks on counterfeit goods. KOTRA have said that currently about 90 per cent of music CDs and records in circulation in the Chinese market are reported to be pirated copies.
Japan is also suffering from such copyright violations in the Chinese markets. Statistics showed that 54 percent of Japanese companies said they had experienced their products being pirated by Chinese companies. Both South Korea and Japan are planning IP task forces to work with the Chinese authorities.

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For details of Intellectual Property Law in The Peoples Republic of China, The Republic of China (Taiwan), Hong Kong Special Administrative Region and Macau Special Administrative Region see:

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