On December 10, the Information Office of the Ministry of Commerce of the People’s Republic of China (hereinafter referred to as “MOFCOM”) held a special press conference on “Combating IPR Infringement and Counterfeits”. Yao Jian, spokesman of the Ministry of Commerce, Chai Haitao, deputy director-general of the Office of the National Leading Group for Combating IPR Infringement and Counterfeits, and Xie Hong, deputy director-general of the Office of the Leading Group of Guangdong Province for Combating IPR Infringement and Counterfeits attended the press conference and took reporters’ questions. Conference minutes are as follows:

Yao Jian: Good morning, everybody! Welcome to today’s special press conference on combating IPR infringement and counterfeits. I’m Yao Jian, director-general of the General Office of the Ministry of Commerce. Today we have Mr. Chai Haitao, deputy director-general of the Office of the National Leading Group for Combating IPR Infringement and Counterfeits, and Mr. Xie Hong, deputy director-general of the Office of the Leading Group of Guangdong Province for Combating IPR Infringement and Counterfeits. Today’s press conference has four agendas. First, I’ll brief on work of the Ministry of Commerce in combating IPR infringement and counterfeits and next arrangement. Second, Mr. Chai will introduce the overall situation and effect of combating IPR infringement and counterfeits in China. Thirdly, Mr. Xie will introduce the experience, practice, and effect of combating IPR Infringement and counterfeits. Fourthly, we will take reporters’ questions concerning combating IPR infringement and counterfeits. Now, I make an introduction.

Everyone knows that, as China implements its strategy of building itself into a creative country, our government has put more emphasis on protecting intellectual property rights and combating fake and shoddy goods. In 2010, the State Council deployed the implementation of special action combating IPR infringement and counterfeits nationwide. In 2011, the State Council set up the National Leading Group for Combating IPR Infringement and Counterfeits for routine work to lead the combating of IPR infringement and counterfeits throughout the country on a unified manner. After establishment of the new administration this year, members of the Leading Group were timely adjusted. Vice Premier Wang Yang concurrently holds the post of the Head of the Leading Group, members of which include 28 departments such as the Propaganda Department of the CPC Central Committee, Ministry of Public Security, Ministry of Agriculture, General Administration of Customs, and the State Administration for Industry & Commerce. Office of the Leading Group (hereinafter referred to as the "Office"), which has been set up in the Ministry of Commerce, undertakes routine work. In this June, the Ministry of Commerce further increased strength of the Office and allocated full-time staffs. The Office turned to independent operation from co-working in an office. The Office, in accordance with decisions and arrangements of the National Leading Group for Combating IPR Infringement and Counterfeits, established and improved the work mechanism, strengthened overall planning and coordination to vigorously promote the in-depth implementation of combating IPR infringement and counterfeits. As a result, obvious results have been achieved.

(I) Continuing carrying out specific rectification and strictly maintaining “law enforcement and combating”. Various regions and departments concerned, tightly centering on trademark right, copyright, patent right, and such key commodities as food and drug, auto spare parts, building materials and children products, organized and carried out a series of rectification actions to seek both temporary and permanent solutions and combine “combating” with “establishment”. Administrative law enforcement highlights guaranteeing people’s livelihood and protecting innovation while criminal justice highlights eradicating criminals’ ability of re-offending. In the first three quarters this year, 234,000 law-breaking and crime cases were investigated and prosecuted nationwide, with the amount involved up to RMB24.18 billion. Public security departments arrested 35,385 criminal suspects; procuratorial organizations reviewed and prosecuted 7,501 suspected criminal cases and 12,990 persons, and adjudication organs adjudicated 6,773 criminal cases and judgment of 10,566 persons took effect.

(II) Intensifying examination and supervision to promote the in-depth implementation. In combination with the examination on comprehensive social management, the first performance appraisal was conducted against combating IPR infringement and counterfeits by provinces (autonomous regions and municipalities directly under the Central Government) in 2012, which gave a vigorous boost to fulfill accountability of local governments. At present, combating IPR infringement and counterfeits in 2013 has been incorporated into the check and evaluation of “safe China” construction. Check and evaluation contents will be further optimized; incentive and restriction mechanism will be improved, to guide, supervise, and urge combating IPR infringement and counterfeits in various regions. For important cases which the masses concern about, the society pays attention to and leaders care for, all member units and relevant regions are actively coordinated to handle such cases according to law. Since the beginning of this year, related departments have been coordinated to jointly investigate and deal with cases where lawbreakers make use of websites to sell copyrights of international standards. A batch of websites which unlawfully sell piratic standards, such as “www.5ibzw.com” and http://cx.spsp.gov.cn/ were banned according to the law, which is highly affirmed by the International Organization for Standardization.

(III) Speeding up institutional and mechanism construction and improving the long-term measures affecting a permanent cure. Revision of two laws, Trademark Law and Special Equipment Safety Law have been completed; the systems of punitive compensation and reversion of burden of proof were first introduced to the trademark right field and the compensation amount was increased to RMB3 million, representing an institutional breakthrough in protection of intellectual property right. A package of laws, including the Regulations for the Implementation of the Copyright Law of the People’s Republic of China, Regulations on the Protection of the Right of Communication through Information Network, Regulations for the Protection of Computer Software, Regulation of the People's Republic of China on Protection of New Varieties of Plants have been revised, and the fine line has been increased sharply. The Supreme People’s Court issued judicial interpretation for dealing with food safety and patent cases, which had improved the law maneuverability. On November 18, 2013, the State Council held an executive meeting, deliberating and approving the opinion on disclosing information of administrative penalty cases of manufacture and sell of fake and shoddy goods and intellectual property right infringement openly. This is an important step towards disclosing governmental information.

(IV) Actively carrying out publicizing and reporting and creating a good public opinion environment. Various central and local media tracked and reported the work of combating IPR infringement and counterfeits, and strengthened supervision by public opinions. They launched special columns, special reports, and special editions in the important pages and times periods, produced in-depth reporting programs to interpret the typical cases on IPR infringement and counterfeits. More than 15,000 piece of news is issued monthly, producing good education and guiding effects. Particularly, around the “March 15 (Consumer Rights Protection Day)”, “April 26 (World Intellectual Property Right Day)” and “Food Safety Publicity Week”, typical cases were exposed and excellent enterprises were reported to enhance the awareness and ability of guarding against infringement and counterfeits of all sectors of the society. Thus, a good public opinion environment was created.

(V) Strengthening international exchanges and cooperation and increasing trust, mutual benefit and win-win. The Office has established a mechanism of coordinating and communicating with domestic-funded and foreign-funded enterprises. The person in charge of the Office regularly presides over symposia to introduce measures against IPR infringement and counterfeits. Besides, communication with such organizations as the US-China Business Council has been strengthened. In September this year, staffs of the Office were invited to have informal discussions with senior officials of embassies of nine countries such as the United States, European countries, Japan and South Korea. They cleared up doubts, introduced policies, and listened to suggestions. As a result, mutual trust and understanding were enhanced. Relevant law enforcement departments strengthened law enforcement and collaboration. Between March and April this year, customs of the United States and China conducted joint law enforcement, hunted down and seized more than 1,000 batches of counterfeit consumer electronics imported to the United States involving more than 100,000 pieces of goods. Such large multinational enterprises as DuPont USA, Ubiquiti Networks, Inc, Beiersdorf AG and such international chambers of commerce as the US-China Business Council and World Bearing Association wrote letters to or paid a visit to relevant departments, and spoke highly of Chinese government’s determination and action of combating IPR infringement and counterfeits. DuPont USA said that, combating IPR infringement and counterfeits indicates Chinese government's determination in protecting IPR, embodies the precise strike ability of such departments as the public security, and increases its confidence on the long-term development in China.

I have briefed on the general situation of combating IPR infringement and counterfeits in this year as above. Now, please welcome Chai Haitao, deputy director-general of the National Leading Group for Combating IPR Infringement and Counterfeits, to introduce main considerations in combating IPR infringement and counterfeits in the next step.
Chai Haitao: the Third Plenary Session of the 18th CPC Central Committee ended last month made important deployment for deepening reform and opening up in an all-around way under new era. Construction of national innovation system, improvement in modern market system and full and proper performance of government functions put forward higher requirements for combating IPR infringement and counterfeits. In the coming year and the coming period, combating IPR infringement and counterfeits shall, guided by the spirit of the Third Plenary Session, in accordance with decisions and arrangements of the National Leading Group for Combating IPR Infringement and Counterfeits, strengthen top-level design and long-term planning, maintain the market order, create an innovative environment and promote safeguarding people’s livelihood to serve the implementation of innovation-driven strategy and construction of the legalized business environment. Priority shall be given to the following aspects: 　

(I) Continuing to well develop special rectification actions in key fields. Currently, IPR infringement and counterfeits in partial fields have the feature of repeatability, and special rectification is an effective means of rapidly containing IPR infringement and counterfeits with concentrated efforts. In the next step, focus will be given to prominent problems impairing vital interests of the people and affecting innovative department. Ways of law enforcement supervision will be innovated and combating IPR infringement and counterfeits at their initial stage will be maintained. From the statistic analysis of case data, there are some new developments in IPR infringement and counterfeits, mainly spreading of key regions to the Midwest, concentration of key markets towards rural-urban continuum and key links shifting to the Internet field. In allusion to problems mentioned above, we will insist on combing rectification of physical markets with that of virtual markets, as well as rectification of domestic transactions with that of cross-border transactions, focus on three aspects of regions with a high frequency of manufacture and sale of fake goods, selling counterfeits via the Internet and spreading pirated products and import & export of fake and shoddy goods, so as to eliminate the industrial chains of cross-border manufacture and sell of counterfeits and protecting the lawful rights and interests of enterprises and consumers.

(II) Doing a good job of disclosing information related to administrative penalty cases. Just now, Mr. Yao has mentioned that, the State Council has deliberated and approved opinions on disclosing information of administrative penalty cases of manufacture and sell of fake and shoddy goods and infringing intellectual property right openly. This is an important reform in the administrative law enforcement supervision method, and is in favor of safeguarding the right to be informed, participation right, and supervision right of the masses, promoting impartial, civilized, and normalized law enforcement, punishing the behaviors of breaching promises and boosting construction of the social credit system. Such Opinions will be formally printed and distributed recently, and we will coordinate relevant departments in formulating the specific measures for implementation, supervise and urge the grass-root law enforcement departments to actively disclose information as required and pay attention to implementation effectively. Meanwhile, we will take this as an opportunity to promote the establishment of the “blacklist” system and accelerate the construction of the social credit system. Currently, we are promoting construction of the enterprise credit file data exchange platform. Information related to administrative penalty cases disclosed in various regions will be gathered after construction of such platform, and the disclosed information will be integrated and used to serve society.

(III) Promoting the effective connection between administrative law enforcement and criminal justice. The co-existence of administrative law enforcement and criminal justice is a distinctive feature of the Chinese law enforcement system. Strengthening the connection between administrative law enforcement and criminal justice is the groundwork to give play to advantages of the law enforcement system, and is an effective means of forming the joint force of combating IPR infringement and counterfeits. The State Council issued No. 37 Document in 2011, which put forward clear requirements for strengthening the connection between administrative law enforcement and criminal justice. In September 2012, the General Office of the State Council forwarded opinions of the Office on strengthening the connection between administrative law enforcement and criminal justice, and put forward institutional arrangements and technical support measures for strengthening the connection between administrative law enforcement and criminal justice. In the next step, emphasis will be put on promoting implementation of such measures, improving the working mechanism for the connection between administrative law enforcement and criminal justice, advancing information sharing among departments, strengthening guidance and supervision on law enforcement and case handling, and ensuring that behaviors related to IPR infringement and counterfeits are investigated and treated according to the law.

(IV) Further strengthening publicity and education groundwork. Focus mainly centers on the following three aspects. First, further give play to www.ipraction.cn to combat infringement and counterfeits. The website will be revised and upgraded next year. Main revisions and upgrades include: extension of portal functions, and increase of local sub webs; optimization of column setup and enhancement in netizen interaction; opening of foreign language websites and expansion of external exchange. Second, do a good job in publicity and education towards the society. We will, by such ways as media publicity, special training, and school education, cultivate the IPR awareness of government staffs, enterprises, the public and adolescents, enhance the self-discipline and rights protection ability of enterprises, and create a social atmosphere of advocating innovation and combating counterfeits. Thirdly, intensify training. We will provide business trainings for the grass-root law enforcement personnel and enterprise managers to further improve their law enforcement ability.

(V) Guiding and promoting local departments to further intensify efforts. Law enforcement supervision is mainly concentrated in the grass roots, and the implementation of local departments has a direct bearing on the actual effects. In the next step, we will use such means as performance evaluation, statistics and notification, and supervision and check, to guide and promote implementation by local authorities. First, we shall well develop 2013 annual performance appraisal. We have, on the basis of summing up experience from 2012 appraisal, formulated the 2013 annual performance appraisal methods, and further improved the appraisal indicators and systems to properly open a gap in scores. We will, taking appraisal as a means, guide and promote implementation of combating IPR infringement and counterfeits by local authorities. Second, continue to supervise and examine handling of major and serious cases. We will, focusing on goods concerning life health and property safety of the masses and prominent problems impairing innovative development, pay special attention to handling major and serious cases, so as to drive the combating of IPR infringement and counterfeits by case handling supervision.

Yao Jian: Thank you, Mr. Chai. Now, please welcome the Director-general Xie Hong to introduce practices and effects of Guangdong Province in combating IPR infringement and counterfeits.

Xie Hong: Since this year, Guangdong Province has, in accordance with the unified deployment of the National Leading Group, combated IPR infringement and counterfeits in a deep-going way, which has achieved remarkable results. The achievements are reflected mainly in the following eight aspects:

First, solid and powerful organization and leadership. The Provincial Party Committee and People’s Government of Guangdong Province pay high attention to combating IPR infringement and counterfeits. The Office of the Leading Group of Guangdong Province for Combating IPR Infringement and Counterfeits formulated and vigorously promoted the annual work plan and organized key member units to construct the cooperative mechanism of sharing information concerning combating IPR infringement and counterfeits. All regions have practically strengthened organization and leadership. Guangzhou and Shenzhen have improved the level of overall planning and coordination agencies of combating IPR infringement and counterfeits. All counties (cities and districts) under the jurisdiction of Guangzhou, Shenzhen, Zhuhai, Shantou, and Zhaoqing established coordination agencies for combating IPR infringement and counterfeits to lay a solid work foundation.

Second, remarkable results in administrative law enforcement. Administrative law enforcement departments at all levels throughout Guangdong Province have tightly combined the routine law enforcement with special action and centered on key goods and prominent problems to practically intensified law enforcement supervision. As at this October, totally 31,400 crime cases related to IPR infringement and counterfeits have been put on record and investigated, involving up to RMB1.52 billion; 25,000 cases have been closed, which involved RMB1.68 billion; 802 cases have been transferred to the judicial authorities, with the amount involved up to RMB670 million.

Thirdly, powerful combating of criminal justice. So far, public security departments of Guangdong Province have put on record 3,361 crime cases related to manufacture and sale of fake goods, 2,575 of which have been solved, with the amount involved more than RMB12.34 billion; prosecutorial organizations of Guangdong Province have ratified the arrest of 1,489 persons related to 917 crime cases of IPR infringement and sale of shoddy goods, prosecuted 811 cases with 1,333 persons involved; courts of Guangdong Province have in total accepted and heard 1,679 cases related to IPR infringement and counterfeits involving 2,656 persons, concluded 1,130 cases with 2,263 persons involved, forming powerful deterrent against criminal offenders.

Fourthly, a steady flow of news of victories in investigating and treating major and serious cases. Guangdong Province gathers its strengths to intensify case solving. It paid special attention to solving cases concerning people’s livelihood and of international concern by means of supervision, trans-provincial joint solving. As a result, it has successively uncovered a series of cases with significant impact such as the case of Wu illegally selling counterfeit cigarettes, the gang case of Zhu’s family manufacturing and selling fake watches, the largest counterfeit edible oil case in Guangdong Province in recent years, the “5.30” cluster case of sale of fake medicine, and the major case of making false invoices.

Fifthly, praises for exhibition protection. IPR-related administrative law enforcement departments at all levels throughout Guangdong Province have successively carried out investigation into IPR infringement behaviors and legal consulting in such large-scale exhibitions as the Canton Fair, China Processing Trade Products Fair, Expo Central China and China Hi-tech Fair. During the 113th and 114th Canton Fair, 1,042 complaints involving IPR infringement were accepted. On June 18, Vice Premier Wang Yang inspected the IPR protection service station of Expo Central China, and gave high marks on the IPR protection in exhibitions held in Guangdong.

Sixthly, preliminary results in the construction of the platform of “connection between administrative law enforcement and criminal justice”. The Provincial Party Committee and People’s Government of Guangdong Province issued opinions on strengthening the connection between administrative law enforcement and criminal justice, and established the joint conference system for the connection between administrative law enforcement and criminal justice. In this October, Guangdong Province’s information sharing platform for “connection between administrative law enforcement and criminal justice” was opened for trial run, and make provisions for information entry and working hours.

Seventhly, in-depth advancement in the software legalization. After government agencies at the provincial and municipal levels fully realized software legalization in 2012, as at the end of October, software legalization of all government agencies of Guangdong Province at the county level has been fully completed, and deployment of the State Council has been completed in advance. Software legalization in Dongguan City has fully covered the towns (sub district offices) and village (neighborhood) committees.　　

Eighthly, increasingly strong cultural atmosphere. The Office of the Leading Group of Guangdong Province for Combating IPR Infringement and Counterfeits set up the website of Guangdong Province in combating IPR infringement and counterfeits, produced feature programs and public service advertisements of combating IPR infringement and counterfeits and published special editions for combating IPR infringement and counterfeits in major media of Guangdong Province to construct a three-dimensional publicity pattern. Guangdong authorities also took the lead in constructing the network public sentiment monitoring system for combating IPR infringement and counterfeits to expand the information sources and strengthen social supervision.

With joint efforts of all localities and departments, Guangdong authorities have achieved remarkable results in combating IPR infringement and counterfeits, have been highly affirmed at home and abroad, and were highly appraised by such countries as the United States, the UK, France and Japan.

The Third Plenary Session of the 18th CPC Central Committee further highlighted the “utilization and protection of intellectual property right”. In future, authorities in Guangdong Province will continue to, according to the national work deployment, insist on combing combating with establishing, resolving the current problems and eliminating the root causes, and further deepen combating IPR infringement and counterfeit.

Yao Jian: Guangdong Province tops other provinces in terms of economic aggregate. In the wake of economic and social development, as Director-general Xie mentioned, we will further pay attention to improvement in social order. Introductions covering combating IPR infringement and counterfeits and IPR protection have been made. Next, we three leave a little time to take your questions in combination with today’s theme.

A reporter with China News Service: Director-general Chai, as for the frequent appearance of fake and shoddy goods during online shopping at present, what do you think about that and what measures will be taken to control? Thank you.

Chai Haitao: You ask a good question. Ordinary people young consumers in particular are all concerned about that very much. Indeed, online shopping is a new form of commercial operation and has been developing rapidly in recent years. For example, each November 11th was called “Singles Day” on line, so later electronic merchants took the opportunity to develop a grand consumers’ festival. This year, only TAOBAO website has achieved RMB35 billion. This is an activity with participation by all people. However, now criminals also target the network, especially online shopping, because it is profitable. How? They can take advantage of wide application of internet technology and e-commerce technology to sell fake goods. 　

Now to sell counterfeits and spread piracy via internet happens more and more frequently. So, compared with traditional manufacture and sale of fake goods, what are characteristics of such online manufacture and sale of fake and shoddy goods? First, high invisibility; second, long chain of illegal criminal activities; and third, scale of crimes. These are determined by the internet technology. For example, if criminals’ command center is located in A place; the production site in B place, and the sale place in C place, while the collection place could be in D place. The network server may be placed in the domestic even in foreign countries. So how shall we deal with new challenges from such method and characteristics to enforce law for, crack down on and control crimes? This trend is a common problem that countries meet and need to reform, innovate and supervise. Office of National Leading Group for Combating IPR Infringement and Counterfeits has noticed the problem during working arrangement and laid an importance to clean up IPR infringement and counterfeits in internet domain since its establishment. Now I would like to introduce several characteristics of work of relevant administrative law enforcement departments. For example, State General Administration of Press, Publication, Radio, Film and Television carries out a resounding “joint action against online piracy” each year mainly to combat online infringement and piracy; Ministry of Culture of the People’s Republic of China strengthens governance of some important markets such as online music, online game and entertainment venues every year. Let’s take internet café for example. If there is a fictitious or counterfeit market entity or merchant carrying online commodity transactions, the industrial and commercial departments will investigate and deal with that. Food and drug administrative departments focus on combating the sale of bogus drugs mainly via internet; public security departments employ economic crime investigator, network security personnel and other professional personnel to find out, investigate and deal with the manufacture and sale of fake goods as soon as possible. Form the current situation, it is a new trend to manufacture and sell fake and shoddy goods via internet with more and more online sale of bogus drugs. This year, for instance, food and drug administrative departments have found out more than two thousand websites involving in illegal sale of drugs through network monitoring. 190 websites were closed during special governances such as readjustment, clearance off and closure. The public security departments organized a “No.1 cluster battle” while various departments carried out special activities with resounding names, stopping sale of fake anticancer and antineoplastic drugs. This battle captured more than 40 drugs and involved a total value over RMB600 million in cases. In such case, what shall we do next? Well, we plan to focus on combating IPR infringement and counterfeits in internet domain to organize a series of special governance activities in next year. We hope to promote and complete the cooperative mechanism between law enforcement supervision departments and some key network platform operators, facilitate the relevant information sharing, improve regulation capability and form a resultant force of combating online manufacture and sale of fake and shoddy goods. At this interest point, the interest of e-commerce operation platform totally conforms to the combat objective and direction of administrative supervision departments. We also wish for reduction of network crimes and their number and guarantee the people’s vital interests as possible as we can through the effective cooperation and information sharing on e-commerce operation platform in a new year.

A reporter with National Business Daily: my question is to Deputy director-general Xie Hong. Just now you have introduced the situation of combating IPR infringement and counterfeits in Guangdong. It is known that Guangdong has taken a series of measures in recent years. Wherein, the establishment of a social credit system is what we are especially concerned about. Could you tell us what Guangdong Province has done and achieved in this aspect?
Xie Hong: In recent years, with the deployment of Provincial Party Committee and Provincial People’s Government, Guangdong specially carried out a series of measures to combat IPR infringement and counterfeits. For example, combat the illegal monopolization of the market through violence, the manufacture and sale of fake goods and the commercial bribery. Guangdong had spent the whole of last year to carry out a one-year special action. From the second half of last year, we focused on promoting the establishment of social credit system and social regulation system. Establishment of the two systems is a significant deployment in Guangdong. With the deployment of Provincial Party Committee and Provincial People’s Government, we have adopted the following methods and means to promote such work at present:

First, insist on implementation of system in advance. We issued Work Plan for Establishment of Socialist Credit System in Guangdong Province to focus on standardizing the collection, management and usage of credit information, credit supervision and reward and punishment, and the regulation of credit service institutions. We have actively explored the development of laws and regulations and system through the critical and important work. We are striving to preliminarily complete the social credit system in line with the development level of market economy and society by the end of 2016.

Second, focus on the promotion of interconnection and sharing of credit information. At present, Guangdong is actively exploring the establishment and operation mode of public credit information system, and worked out its general development scheme and framework of content. Individual, enterprise, public institution and social organization are included. The framework of content covers information about all aspects of credit. We also opened Guangdong enterprise credit information system by integration and optimization. Currently, we have integrated information about over 1.3 million enterprises all over the province in the system, and will continue optimizing the system.

Thirdly, greatly foster and develop credit service market and fully play the basic role of market in information resource allocation. At present, a sound trend is initially formed with coexistence and development of various kinds of business, including credit rating, credit rank, credit reference, credit guaranty, credit management consulting, credit insurance and insurance agency operation.

Fourthly, continuously strengthen social supervision. We have led social organizations to develop the mechanism of industrial standard operation, engagement in good faith, information openness, competition fairness, reward and punishment, and self-regulation guarantee, to effectively impel the mechanism construction of incentive for keeping promise and punishment for breaking a promise. So far the work has achieved remarkable effect.
Fifthly, widely carry out activities of integrity theme building, and enhance the credit training for key people concerned. Guangdong Province also actively carries out credit education among adolescent students in the whole province to continually develop credit consciousness and cognition level of credit. Next, Guangdong Province will further devote greater efforts to set up a complete credit information management system covering the whole province, continue accelerating the construction of good faith in Guangdong, and try to develop Guangdong as a new highlight of national credit system establishment. Thank you.

A reporter with Finance.China.Com.cn: Director-general Chai, you have just mentioned that sales on “double 11” hit a record high this year. In addition, the “double 12” is just around the corner, small online stores attract lots of employees. So how to take into account both market and employment during governance? Second, Could you talk about the operation mode of the enterprise credit file data exchange platform just mentioned in detail?
Chai Haitao: first, you put forward a grand proposition reflecting a problem of relationship between combating online IPR Infringement and Counterfeits and protection of employment. I think their relationship is not contradictory on this problem, because there is an E-marketing environment where network can operate and develop healthily and ordinary people can conduct online shopping relievedly and happily. Such a fair, just, open and orderly environment itself will foster various small and medium-sized business to develop rapidly. It is the same even in traditional commercial mode. If people can buy secure food and real commodities in traditional business street, supermarket or general merchandise store, consumers will certainly rush for. Therefore, to combat online IPR Infringement and Counterfeits is basically consistent with ensuring the development of small and medium-sized business and the full employment. There is no conflict.

Second, what you really wonder is how to foster small and medium-sized business to develop rapidly during online shopping and whether they will shrink back at the sight of regulations or restrictive measures increased by the government. The two questions are beyond the scope of combating IPR Infringement and Counterfeits, but I still would like to give you my own opinions. I think development is the priority during development of network, online shopping and e-commerce. Regulate during development while gradually develop under regulation. Such a method can make Chinese e-commerce develop more vigorously and rapidly. Meanwhile, I can tell you this is a successful way to develop and standardize e-commerce in the U.S. and Europe.

The question of credit platform falls into my major. I can responsibly tell that we are establishing a credit central data bank about combating IPR infringement and counterfeits. In addition to legal operation information of general enterprise business registration, the database will incorporate the consequences information of IPR infringement and counterfeits administrative penalty cases. This is the most important work in next year. As for the number, according to statistics in last three years, the nine administrative law enforcement departments I just mentioned generally deal with more than 200,000 cases involving administrative penalty for IPR Infringement and Counterfeits every year. If the objective can come true, the central data bank will offer public services for the society, give enormous consumers and normally running enterprises the convenience to recognize and tell apart counterfeits, and avoid business with those enterprises on the “blacklist” or purchase of their goods. This also increases the social transparency, as well as a comparatively bigger change in terms of good faith and credit construction. Thank you.

A reporter with People’s Daily: my question is to Director-General Yao Jian, an early agreement of Doha Round was reached during the ninth Ministerial Conference held by WTO in Bali, Indonesia on December 7. This broke through the zero agreement of the Doha Development Agenda negotiation for 12 years. What benefits can the early agreement bring to China? What aspects will China fulfill its promise? Additionally, it’s reported that China played a special promotion role in the negotiation of the early agreement. So what specific work did China finish? how will China continue advancing Doha Round negotiations further then?

Yao Jian: Thanks for your question. It relates to overall trade environment in some way. I'd like to give some introductions.

The ninth Ministerial Conference of WTO was ended relevant agendas in Bali, Indonesia after continuous five-day work, and has been concluded an early agreement of Doha Round in last week. Everyone especially international community pays so much attention to the early agreement of Doha Round for its striking content on trade facilitation, some elements of agriculture, and development. Since China is a large developing country and a trade nation, these issues are closely related to us. The second reason is that it's difficult for various parities to reach an agreement on their interests after the exploration, negotiation and communication of Doha Development Agenda negotiation for the 12 years. Moreover, this agreement is a symbolic breakthrough in the twelve-year Doha Development Agenda negotiation, and thus draws people’s attention a lot.

There are two meanings of the conclusion of early Doha Round agreement under current background. First, it can improve the confidence of international community especially economic circles for global economic recovery. WTO predicted that global economy is recovering moderately. The global trade increased by 2.5% in 2013, a lower growth to some extent. Delivering an early harvest of Doha Round can further promote trade facilitation. OECD analyzed that trade facilitation would increase by 5% exports in developed countries and 10% exports in developing countries all over the world. It will also promote development of other aspects in developing countries further, such as exports of agriculture and agricultural products.

Second, China ranks the second place in global trade, accounting for more than 11% of the total. As one of important contents of the early harvest agreement, trade facilitation can help further expand foreign trade and enhance international cooperation of China. In case that the U.S., EU and Japan suffer from economic crisis, trade facilitation is a very important measure for China to further develop emerging markets. For a single enterprise, trade facilitation means the reduction of operating cost, the improvement of efficiency, an easy access to customs clearance, of course, and the benefits on agriculture. China is a developing country, so agricultural issues are important contents of work.

We have participated in WTO for 12 years and gradually changed from initial recipient country of WTO rules to active participant and constitutor of WTO rules. Since 12 years, we submitted more than 100 proposals to WTO to report China’s appeal. We have always played a role of promoting negotiation, agreement and conclusion in this early harvest agreement of Doha Round. In the five-day conference, Minister of Commerce of PRC, Mr. Gao Hucheng and another two leaders of Ministry of Commerce participated in the same and played an important role in conclusion of early harvest agreement. They conducted wide communications and promotion with the U.S., India, Indonesia and Cuba, to make that agreement reach at the last moment. It is important to implement subsequent relevant measures after its conclusion. For example, we will further implement measures about trade facilitation, and increase the transparency on tariff quota of agricultural products and state management trade of agricultural product exports. Meanwhile, we will further increase assistance for least developed countries. During the conference, Minister of Commerce of PRC, Mr. Gao Hucheng specially attended the China and C4 Countries of Africa Press Conference on Cooperation in Cotton Industry. China will promote the development and trade in cotton industry in C4 countries through development assistance according to its relevant promise. It can be said that the early Doha Round agreement of MC9 inspires countries’ confidence on international economy and the multilateral trading system. Our country will continue playing the active and constructive role in this system. Above is my brief introduction.

A Reporter with CCTV-News: I want to ask Mr. Chai some questions about IPR infringement of network companies. Recently, Baidu was sentenced to have infringed IPR, and a number of small-sized network companies have left China because their slightly better achievements or some better ideas were often copied by large network companies or other small ones. This situation heavily discourages innovation of network companies. So I want to know how will China to regulate such IPR infringements among the network companies. The U.S. prefers to give support to the small companies in the lawsuits between large and small network companies. Will China follow that? Thanks.

Chai Haitao: At the macro level, the Third Plenary Session of the 18th CPC Central Committee has proposed to vigorously protect innovation with implementation of national innovation and development strategy. Therefore, from the general principle, the national policy-making tends to give more protection for all production and operation activities conducive to innovation. Secondly, in the infringement field involved copyright, what the government needs to do is still to deal with the disputes among companies according to the laws and regulations. The rights and wrongs shall be judged by the laws and regulations; what the government can do is to protect innovation in terms of policies, and to process the infringement acts according to the laws. Thirdly, in China's legislature, there are three laws about intellectual property involved currently. For example, the amendment to the Trademark Law has been issued this year. It focuses on optimizing internal processes, increasing the amount of penalties for infringement, and even formulating some clauses of reversion of burden of proof. To my knowledge, the related departments are stepping up researches on the amendments to the Copyright Law and Patent Law. I hope these amendments to the three laws pertaining intellectual property and enactment of supporting regulations and judicial interpretations can cover the issues protecting SME innovation that you concerned.

A Reporter with International Business Daily: I want to ask questions about issues after the end of “Three Combats and Two Establishments”. What are the specific measures in terms of long-effect mechanism to combat IPR infringement and counterfeits in Guangdong Province? Thank you.

Xie Hong: First of all, I want to reiterate work in progress in the “Three Combats and Two Establishments”. The “Three Combats” was a specific project concerning combating the illegal monopolization of the market through violence, the manufacture and sale of fake goods and the commercial bribery, which has ended and transferred into construction of normal mechanism. The “Two Establishments” includes establishing social credit system and social regulation system, which is the major task in progress in our province. It launched in the last year, and is the preliminary work plan until 2016. Currently, we closely carry out IPR infringement together with “Two Establishments”. As for our specific approaches, first is to improve the legal system. We summarized the good practices and experience to combat IPR infringement and counterfeits in recent years, and have enacted a series of laws and regulations for support at the institutional level in recent years. For example, Regulations of Guangdong on Investigating the Illegal Acts of Producing and Selling Fake and Shoddy Goods has been revised with enactment of the Guangdong Provincial Patent Ordinance, Measures of Guangdong Province for the Protection of Patent during Exhibition and Provisions of Guangdong Province on Standardizing the Discretionary Power of Administrative Penalties. All these are regulations at the provincial level. All cities in Guangdong Province have also introduced a series of policies and regulations on intellectual property protection and fighting against infringement and counterfeits, such as the Measures of Guangzhou City for the Protection of Intellectual Property Rights during Exhibitions, Regulations of Shenzhen Special Economic Zone on Strengthening Protection of Intellectual Property Rights, as well as the Regulations of Shantou City on Patent Protection and Promotion, and a series of other local laws and regulations in this field. The second approach is to enhance the construction of law enforcement ability. 1. Continually promoting construction of professional force and mechanism for fighting against infringement and counterfeits. For instance, the public security organ in Guangzhou City first established a group of intact professional force for fighting against food and pharmaceutical crimes in Guangdong Province. 2. Establishment of law enforcement cooperation mechanism across departments and regions. The provincial leading group office engaged in fighting against IPR infringement coordinated the related law enforcement departments and Guangdong Provincial Public Security Department to sign a memorandum of cooperation in information sharing, and introduced and promoted the construction of overall platform for connection of “Two Laws”. We also established the regulatory and enforcement system integrating preventing and early warning along with combat and punishment. For example, the industrial and commercial system of the whole province takes the industrial and commercial office as the main force for regulation to conduct grid regulation for markets within their jurisdiction, so such law enforcement is in place and covers every corner. 4. Promoting the overall strength combating IPR infringement and counterfeits through continuous improvement of law enforcement equipment, inspection and checkout technologies and other technologies. The third is to give full play to the social supervision forces. All foreign consulates in Guangdong, our provincial departments, and departments in cities and districts at all levels in Guangdong strengthen the information sharing. For example, Guangdong Food and Drug Administration, Guangdong Provincial Public Security Department, and well-known enterprises such as Pfizer from the U.S. and other enterprises cooperatively held meetings of exchange for fighting drug counterfeiting to intensity cooperation of different sectors. In addition, Zhongshan City established a rapid IPR protection center, which plays a role of protecting IPR in industrial alliance and professional market. Moreover, a protection system integrating enterprises, industrial association, service organizations and government departments and other forces was formed. Fourthly is to strengthen the supervision and assessment. We are now combining the combats against IPR infringement and counterfeits with the “Two Establishments”, and including those into assessments of “Two Establishments” and comprehensive improvement, so as to lay a foundation for the orderly competitive environment and favorable good faith development situation. Thank you.

A reporter with CCTV-Finance: Director-general Chai, the Third Plenary Session of the 18th CPC Central Committee also put forward to improve the connection between administrative law enforcement and administrative judicature, and you also introduced the key emphasis in work of next step, so could you tell us what problems exist in connection of the two aspects, and how this work can be specifically implemented?

Chai Haitao: Your questions are rather professional. I think the point for these two questions is effective communication between the judicial departments and departments of administrative law enforcement, so as to solve the problem of improving administrative efficiency, namely the Pareto improvement in administrative efficiency in an economic term. That is my opinion. In the previous introduction, I have mentioned that, China now boasts the co-existence of administrative law enforcement and criminal judicature, which is in line with China's national conditions. The administrative law enforcement has relatively strong initiative; however, the judicature is subject to the principle of “no trail without complaint”. In addition to strong initiative, the administrative law enforcement is also flexible in manner, which can quickly stop general unlawful acts. The criminal judicature has heavy punishments. Those serious cases shall be subject to the criminal laws, which formed a strong deterrent for criminals. Over these years, a number of regions and departments have been exploring how to promote the connection of the two aspects, and have made a lot of advanced experience and effectiveness. However, here are some problems. Firstly, after all the administrative law enforcement and criminal judicature involve the administrative system and judicial system, so the work mechanism between them needs to be improved to some extent; for example, the delivery, acceptance, feedback of cases need to be further smoothed. Secondly, information sharing among departments has not effectively achieved. This shall be an old problem, which is not only concerning connection of the administrative law enforcement and criminal judicature but also a problem that all national governments shall always attempt to improve. Information sharing among departments shall be reached to form the join forces for combats. Thirdly, at the policy level, the specific operations of legal provisions need to be further refined and perfected. Policies, regulations, provisions should be more practical. As for these three aspects of the problem, we shall strengthen the connection of the two aspects from the following three points:

First, a joint conference system shall be nationally established, promoted and perfected, namely the joint meeting system of administrative law enforcement departments and criminal judicature departments. The central government has a good mechanism currently. The National Leading Group for Combating IPR Infringement and Counterfeits has been set up with office in charge of executive work. The central government and provincial governments have collectively established the joint conference system, so we require all local governments to set up the joint conference system, case consultation system used for consultation of inconclusive cases, interview and inspection system, statistical and reporting system, as well as regular training system, so as to establish a mechanism to strengthen the connection between the administrative law enforcement and criminal judicature from this aspect.

Second, the information sharing platform shall be established for connection of the administrative law enforcement and criminal judicature as soon as possible, namely, informatization. That is to say, an effective and convenient information sharing channel shall be set up among all departments. The frame of such platform at the central level has been established, so we are focusing on such establishment at the provincial level. If all provinces can effectively share information and realize interconnection, the validity of connection between the administrative law enforcement and criminal judicature could be greatly improved.

Thirdly, the laws and regulations shall be improved; i.e., the supporting normative documents and judicial interpretation shall be promulgated for those provisions with poor operability, so as to further enhance the operability of relevant laws and regulations.

A reporter with China Daily: The EU has recently begun to impose anti-dumping and anti-subsidy duties on China's photovoltaic solar panels, so I want to ask Mr. Yao what extent this will influence China's whole photovoltaic industry. The early mentioned price undertaking has covered some enterprises, so what extent of difference there will be between the covered enterprises and uncovered ones? Some reports said that the number of uncovered enterprises reached to 30%, could you please confirm it?

Yao Jian: Thank you for paying attention to this photovoltaic case all the time. European Commission published the results announcement concerning the photovoltaic case on its Official Journal on December 5, which means a closure has been achieved. The results bring a win-win situation, which are acceptable for both parties through collaborations. This case can be traced back to last September to November, during which the EU launched anti-dumping and anti-subsidy investigation against Chinese photovoltaic products and in this July, both EU and China achieved price undertaking. During the period this case attracted full attention from leaders of both parties and Chinese leaders even involved in this case directly; besides, the significant efforts from this industry should also be appreciated. The reason why this case can attract so much attention and obtain so much effort from both country leaders and this industry is that so far this case is the biggest trade friction found by us, which relates to export amount of over USD20 billion and employment of 400,000 persons.

In total 121 companies that export photovoltaic products to EU took part in the price negotiation held by China Chamber of Commerce of Machinery and Electronic Products and after 42-day negotiation, the price undertaking is finally achieved; i.e., our products can be exported at not less than a specified price, covering 79% of the exports during the investigation period from China to EU. This is a reasonable and compromising price, which will benefit most of the photovoltaic products export business. In addition, over a dozen of business is involved in the investigation but not within the scope of price undertaking. The customs duties from both anti-dumping and anti-subsidy they undertake will amount to 47% while the business that were not willing to collaborate undertake approximately 67%.
The Announcement indicates that the 121 business that involve in this price undertaking are exempted from anti-dumping and anti-subsidy duties and maintain their export share in the EU market. The Announcement also benefits domestic industry, although the subject today is combating IPR infringement and counterfeits, at a higher level, it's maintaining an orderly market. In fact, price undertaking can also contribute to good market order since it's no longer a right way for our photovoltaic business to follow up their development strategy of resources wasting, environmental damage and underselling. This price undertaking improves the profitability of our business with their manufacturing capacity and level advanced; as a result, the transformation and upgrading of business as well as environmental protection will no longer be a dream. As a matter of fact, this comprising price will help EU import products beneficial to the environmental protection and help them reach the goal of developing green industry.

What we learned from this case is that reaching a consensus through negotiation and collaboration will be a main approach to solve the problem caused by trade friction and trade disputes. In the first 11 months of this year, we encountered in total 80 trade friction cases from 18 countries and regions since we are a big trading nation; compared with last year, the number increases by 12%. We are expecting to reach a consensus through negotiations in this industry as well as between governments, which can not only benefit the good order in trading, but also can enhance the product competitiveness as well as the technical R&D ability of Chinese business and further help achieve the goal of improving the quality of their products.

Yao Jian: Well, that's the end of today's Press Conference, thank you all!

Translated by Huang Lin

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