Intellectual Property, Business and China: Taking a Stand

Abstract

Over the last 40 years, China has developed laws for the protection of intellectual property rights. Unfortunately, these laws have not been uniformly enforced, making such protection problematic for Australian and other foreign organisations wishing to do business in China. This article first scrutinises the current Chinese laws covering intellectual property protection. It then examines the outcomes of a qualitative study that addressed intellectual property protection issues faced by selected Australian organisations conducting business with Chinese counterparts located in China. Forty Australian business managers/owners from Australian companies having business relationships with Chinese firms were interviewed for this study. The findings show that protection issues are only relevant to certain types of businesses that have intellectual property to protect. Nevertheless, a number of the managers/owners interviewed believed that infringement threats were real and inevitable in China, and some had even experienced cases of copying. The study found that, despite such concerns, there was little evidence of organisations taking proactive and positive steps to adequately protect their intellectual property. In order to address this, the authors of this article have developed a protection strategy that incorporates the use of the law, together with firms' organisational designs, so that foreign firms can protect their rights when interacting with the Chinese market.