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Policy Statement & Submission

1999/04/01

Response to government consultation on Combating Intellectual Property Rights Infringement in Hong Kong

Introduction

1. We support protection of intellectual property rights (IPR). IPR protection is important in its own right. As Hong Kong strives to become a centre of innovation and technology, effective protection of IPR has taken on an added significance.

2. Unfortunately, there has lately been rampant infringement of IPR in Hong Kong. This is not only hurting IPR owners but also damaging Hong Kong's reputation. We share the government's and the community's concern over copyright piracy and counterfeiting, and we would support additional action to combat these illegal activities. We support the introduction of a more stringent regime to clamp down on piracy and counterfeiting and we welcome the consultation paper issued by the government on the subject.

3. At the same time, we would emphasise that eventually the rationale for IPR is not the protection of vested interests but of the wider social interests, including consumer interests. This principle should also be recognised in designing new measures to combat infringement.

4. Our specific comments on the options proposed by the government are as follows.

Specific comments

Option 1: Including piracy and counterfeiting offences under the Organised And Serious Crimes Ordinance

Option 2: Amending the Copyright Ordinance and the Trade Descriptions Ordinance to provide for the confiscation of criminal proceeds from intellectual property infringement offences.

5. Piracy is not just a petty crime; it is almost a sizeable industry. We have no doubt that its nature is that of an organised and serious crime, hence we see much merit in Option 1. However, we do appreciate that the right of a witness to silence should not be removed lightly, hence on balance we would favour Option 2.

Option 3: Introduction of mandatory or standard sentences for copyright and trade mark offences.

6. We agree with this option. Although it may appear a rather extreme course of action, it has a clear advantage of being expedient.

Option 4: Closure orders against premises used repeatedly for piracy or counterfeiting activities

Option 5: Immediate closure orders for premises used for piracy or counterfeiting activities.

7. Unlike vice dens, shops selling pirated discs are breaking the law openly. We believe much more stringent action is needed to combat such blatant disregard of the law. Hence we would support Option 5, immediate closure of premises.

Option 6: Banning unauthorised video recording in cinemas

Option 7: Banning video equipment in cinemas

8. We support Option 6. In our view Option 7 would be very complicated to enforce. It does not enhance Hong Kong's image to the tourists either.

Option 8: Imposing consumer liability

9. In our view, imposing consumer liability will be too extreme a measure and will be counter-productive. In the campaign against IPR infringement, the consumer is the one group which we should not alienate. The battle should be one between society and the criminals, not one between IPR businesses and consumers.

Option 8a: Fixed penalty for possession of infringement articles

Option 8b: Create a smuggling offence at the border in respect of import or export of infringing articles

10. For the above reason, we do not support either Option 8a or 8b.

Option 8c: Recasting the offence of possessing of infringing articles

11. However, we do support Option 8c. It is, in our view, is not so much imposing consumer liability but narrowing the damage done by abuse of IPR. The “Cons” as stated in the consultative document, that “Those doing business in Hong Kong would have to take careful steps to ensure compliance with intellectual property licensing conditions”, should not be regarded as a disadvantage at all. Rather, it should be the responsibility of every business to ensure that they are doing business lawfully.

Conclusion

12. We support a tougher regime against IPR infringement. However, we would emphasise that respect for IPR is the hallmark of a mature civil society, which is achieved through developing a collective understanding of IPR in conjunction with punitive sanctions. We believe there is still much more room for IPR producers to cooperate with government and the business sector in educating the community about IPR.

13. Finally, an important weapon against IPR infringement is to have a more open market offering more choice for genuine products. Policies which are not consistent with the development of a more open market, for example, the ban on parallel importation, should therefore be reviewed.

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