HONG KONG 2004 - Commerce and Industry

The Government's commitment to protecting intellectual property rights is evidenced by its dynamic legislative programme to ensure that our intellectual property laws are updated and effective, with vigorous law enforcement to combat piracy and counterfeiting activities and continuous public education efforts to increase the community's awareness of and respect for intellectual property rights. Hong Kong has in place an intellectual property protection regime which is in line with international standards.

Registration activities have taken on a new focus to deliver Internet online filing ('e-filing') of trade marks (available since December 31, 2003), and Internet online publication of patents and designs (available since May 7, 2004). Rollout of e-filing of patent and design forms was completed in December 2004. The target is to increase the migration rate of e-filing from around 10 per cent in 2004-05 to 30 per cent in 2005-06.

The development of new computer systems for the processing of trade mark, patent and design applications through outsourcing was completed in August 2004. E-filing, e-publication and automated examination are distinctive features of the e-business model of the Intellectual Property Department. Cost savings achieved under e-filing are passed back to users through fees reduction.

The Trade Marks Registry is responsible for the registration of trade marks in respect of goods and services. In 2004, 19 940 applications were received, comprising 13 176 single-class applications and 6 764 multiple-class applications. During the period, 26 440 marks were registered, an increase of 29.9 per cent compared with 20 359 in 2003. Out of the total of 86 countries filing applications, the principal places from which applications originated were:

With effect from January 1, 2005, Hong Kong service suppliers will be able to conduct trade mark agency business in the Mainland after registering with the Administration for Industry and Commerce at the provincial level and acquiring the qualification of a statutory operating body.

The Patents Ordinance provides for the grant of standard patents based on patents granted in the State Intellectual Property Office of China, the United Kingdom Patent Office or the European Patent Office (in respect of patents designating the United Kingdom). It also provides for the grant of short-term patents. The commencement of the Patents (General) (Amendment) Rules 2004 on May 7, 2004 has enabled e-filing and e-publication for patents. The fees for patent registration services, which are charged at full-cost recovery basis, have been reduced by 73 per cent. In 2004, the Patents Registry received 10 005 standard patent applications and 4 242 were granted. During the period, there were also 416 applications for grant of short-term patents, and 329 were granted.

Starting from 2004, eligible Hong Kong residents can sit the National Qualification Examination for Patent Agents, which was previously open only to Chinese Nationals in the Mainland, to qualify as patent agents in the Mainland. Candidates who pass the examination need to complete one full year of apprenticeship in an authorised patent agency in the Mainland before obtaining the qualification to act as patent agents. With technical and logistical support from the Intellectual Property Department, the Hong Kong Intellectual Property Society organised a training course in August, which was open to candidates sitting the examination as well as those interested in Mainland patent law and practice. The examination is held once every two years, and the latest examination took place in October. Some 42 Hong Kong residents took part in that examination and three candidates passed. From January 1, 2005, Hong Kong residents will be able to provide patent agency service in the Mainland subject to meeting the stated qualifications.

The Registered Designs Ordinance enables designs to be registered independently in the HKSAR. The commencement of the Registered Designs (Amendment) Rules 2004 on May 7, 2004 enabled e-filing and e-publication for designs. The fees for design registration services, which are charged at full-cost recovery basis, have been reduced by 51 per cent. In 2004, the Designs Registry received 3 026 applications for registration of 4 609 designs, comprising 2 458 single-design applications and 568 multiple-design applications. During the period, 4 213 designs were registered.

With online search of designs, owners of registered designs are able to show proof of ownership at the venue of exhibitions worldwide. This facility has encouraged design owners to register their designs for protection from infringements.

The Copyright Ordinance provides protection for literary, dramatic, musical and artistic works, typographical arrangements of published editions, sound recordings, films, broadcasts, cable programmes, and performers' performances irrespective of the domicile of the copyright owners. In line with international standards, there is no requirement to register copyright.

The Copyright (Amendment) Ordinance 2004, effective on September 1, introduced the 'copyshop offence' to facilitate enforcement and prosecution against illicit reproduction of books, magazines or periodicals by copyshops for the purpose of or in the course of their business.

In addition, to further improve Hong Kong's legislative regime for protecting copyright, a consultation document on the review of certain provisions of the Copyright Ordinance was released in December. The consultation document sets out the main issues related to end-user liability, copyright exemption and a number of other aspects in the Copyright Ordinance that require a review.

The Customs and Excise Department is responsible for enforcing the criminal sanctions for the protection of copyright and trade marks. It investigates reports of copyright infringement and trade mark counterfeiting, and takes action against the manufacture, distribution, sale, import and export of pirated and counterfeit goods. The department also takes action against the possession of infringing copies of computer programmes, movies, television dramas and music recordings for use in business as well as unauthorised possession of video recording equipment in a place of public entertainment used primarily as a cinema, theatre or concert hall.

The department maintains stringent control on all optical disc and stamper factories to prevent them from engaging in copyright piracy activities. Optical disc and stamper manufacturers are required to apply for a licence from the Commissioner of Customs and Excise. At year-end, 119 licensed stamper and optical disc factories, 811 optical disc production lines and 18 stamper production units were registered with the department.

During the year, the department processed 8 712 cases and arrested 1 135 persons in connection with copyright piracy. A total of 7.31 million pirated optical discs and other pirated items, valued at $273 million, were seized. The department also processed 898 cases relating to counterfeit goods and goods bearing false trade descriptions. A total of 691 people were arrested and 32 million pieces of counterfeit goods, valued at $305 million, were seized.

During the year, the department detected 23 corporate software end-user piracy cases, resulting in the arrest of 59 people and the seizure of infringing copies of computer software with a market value of $2 million, as estimated by the copyright owners. It also took action against end-user piracy on the use of infringing music videos in karaoke establishments, resulting in the arrest of 15 people and the seizure of 47 sets of computer and other audio-visual equipment valued at $700,000. The department also took action against illicit copying by copy-shops. During the year, the department detected 34 photocopying piracy cases, resulting in the seizure of infringing photocopies and photocopying equipment valued at $1.3 million and the arrest of 44 people.

The Special Task Force of 147 Customs officers continued to take vigorous enforcement action against illicit manufacturing and retail of pirated optical discs. Its major enforcement strategies are to carry out repeated and focused raiding at 'black spot' retail outlets, and to track down their storage and manufacturing facilities to suppress the sale of pirated optical discs.

As a result of the department's vigorous enforcement action, large-scale illicit optical disc manufacturing activities, for which expensive automatic production lines were used, have been successfully stamped out, and no such activity was detected in 2004. Copyright pirates continue to rely on small-scale copying workshops equipped with CD/DVD-writers to manufacture pirated discs. During the year, the department neutralised 22 such illegal workshops, with the seizure of 633 CD/DVD-writers and the arrest of 63 people.

The department also takes action against copyright piracy on the Internet. Since its establishment in early 2000, the department's Anti-Internet Piracy Team has detected 37 Internet piracy cases, resulting in the seizure of pirated goods and equipment valued at $2.22 million, and the arrest of 63 people.

During the year, the Intellectual Property Department continued territory-wide campaigns such as the 'No Fakes' and 'I Pledge' campaigns to promote intellectual property rights to the public. With the aim of promoting the 'no fakes' branding concept to visitors from Guangdong, and to help encourage greater participation among stakeholders in the PRD Region, the department cooperated with the Guangdong provincial intellectual property authorities to launch the 'no fakes' campaign in four cities — Guangzhou, Shenzhen, Shantou and Dongguan — in Guangdong Province. The department and the Guangdong Intellectual Property Office also jointly developed a television advertisement promoting the campaign, which has been shown in Hong Kong and Guangdong province since December 21.

In 2004, the department carried its secondary school visits programme into the eighth year with the aim of promoting respect for intellectual property rights among the younger generation. During the year, this programme covered 48 secondary and primary schools and 18 458 students. The department commissioned an annual public survey in November to compare changing public attitudes towards intellectual property over the years and to assess the effectiveness of its promotion and public education programmes. The survey results have shown that public understanding of intellectual property rights has been improving. The first annual survey measuring the awareness of intellectual property in the business community was conducted in February. The results of the survey provided useful insights for strengthening government efforts in promoting intellectual property rights among the business sector.

Following the Sixth Guangdong/Hong Kong Joint Conference on August 5, 2003, the Guangdong/Hong Kong Expert Group on the Protection of Intellectual Property Rights was set up to enhance cooperation between the two places for the protection of intellectual property rights. The third Expert Group Meeting was held in Hong Kong on December 21.

The Intellectual Property Department continued to participate in the activities of the WTO Council for Trade-Related Aspects of Intellectual Property Rights (TRIPS). Representatives of the department also attended conferences at the World Intellectual Property Organisation (WIPO), including the meeting of the Assemblies of the Member States, and the conferences held by various committees, such as the Standing Committee on Copyright and Related Rights. In March, the department and WIPO co-organised the '2004 WIPO Regional Symposium on Copyright in Libraries and Educational Institutions in the Digital Era' in Hong Kong. The department also represented Hong Kong, China at other international and regional intellectual property symposia and conferences, including the 18th meeting of the APEC Intellectual Property Experts Group held in Beijing in April and the 19th meeting held in Phuket, Thailand, in August.