The protection of intellectual property rights is a key tool China is using to improve the business environment for both domestic and foreign enterprises, according to a British legal expert.
The acknowledgement of the need for such a system and its application is critical in achieving sustainable development as China encourages innovation nationally and seeks to attract worldwide investors into more advanced sectors, said Christopher Bovis, a professor of international business law at the University of Hull.
"China's structural reform and the continuous opening-up of its economy have coincided with the application of a governance model for responsive and responsible political and economic leadership which insists on the need to promote sustainable development," said Bovis."A cornerstone of this sustainable development plan is the full recognition and function of a system of intellectual property regulation."
He was speaking after Premier Li Keqiang delivered the government work report at the second session of the 13th National People's Congress, which opened in Beijing last Tuesday. One of the major tasks for China in 2019 will be the improvement of its business environment.
A worldwide applied intellectual property regulatory system would help Chinainitiate domestic innovation, which would contribute to a complete production cycle and mean China will no longer simply assemble products that have been designed elsewhere, but participate in product development,from the idea stage all the way to production, he said.
It could also attract more advanced overseas industries by protecting the IP rights related to those industrial sectors.
Currently, foreign investors worry that, in comparison to State-owned enterprises, they are not guaranteed to be on the same level playing field, he said.But Bovis praised China's performance in IP protection and the regulation of rights associated with IP that have developed to address these concerns.
He said an example of recent progress is the China-EU 2020 Strategic Agenda for Cooperation.
"The China-EU 2020 Strategic Agenda for Cooperation was adopted in 2016 with a trade agenda … engaging at the multilateral level whilst recognizing all relevant trade-related aspects of intellectual property rights, which is a key part of the trading system under the World Trade Organization framework," he said."In particular, the EU has requested increased certainty and legitimate expectations on screening and assessment controls of European investment into China that are based on national interest beyond national security requirements. The EU has also stressed the need for the highest possible level of uniform standards of legal protection, including the protection of intellectual property rights for European investors in China."
Another example is China setting up specific courts to hear intellectual property rights cases. One courts in Beijing, which was China's first IPR court, handled about 18,000 cases in 2018, up 19 percent year-on-year, according to a Xinhua report.
These courts provide opportunities for both foreign entities and local ones to safeguard their intellectual property rights; improving the business environment and encouraging innovation.
"The creation of a judicial system which is dedicated to intellectual property rights and their protection in China has been a most reassuring sign of China's seriousness to investment protection," Bovis said.
From January this year, the Supreme People's Court established a new court to hear intellectual property rights cases, which showcases the nation's determination to improve the system of arbitration for IP infringements.