Haworth & Lexon Law Newsletter
No.7, 2003 (Total:No.23) Aug.20th, 2003
Edited by Haworth & Lexon
Guidelines
★ Measures for the Implementation of the Copyright Administrative Penalty shall go into effect on Sept. 1, 2003
★New provisions concerning supervision of non-trade selling and paying foreign exchange for transnational corporations have been formulated
★ New laws trend:
Profit deposit of foreign investment could be sent back.
The policies for current account management of foreign exchange under the items such as international construction contract have been revised.
Infringing upon the copyright of computer software:
The person who was complained should provide evidences to prove the legal source of software that he used.
Measures for the Implementation of the Copyright Administrative Penalty shall go into effect on Sept. 1, 2003
National Copyright Administration promulgated the new revised Measures for the Implementation of the Copyright Administrative Penalty, which shall go into effect on Sept. 1, 2003.
The Measures defined the content of copyright administrative penalty. According to the Measures, copyright administrative department are responsible for investigating and handling the illegal acts that "both infringed upon the copyright and damaged the public interests."
Meanwhile, based on the provisions of China's Copyright Law, if the circumstances of infringement are serious, copyright administrative department are authorized to confiscate the materials, implements and equipments that mainly were used to reproduce the works by infringing on the copyright of the owners. The new measures also defined the "serious circumstances". It means that the amount of earnings from sales for individuals is more than 30,000 yuan or the amount of earnings from sales for corporations is more than 100,000 yuan. It also means that the sales amount of works for individuals is more than 2,000 volumes or more than 5,000 for corporations. If some persons who once were investigated for criminal responsibility of copyright tort infringed upon copyright again, it could also constituted the "serious circumstances".
Meanwhile, the new Measures further stipulated the "amount for hearing of witnesses". The former measures only stipulated the condition for parties to apply for hearing of witnesses when National Copyright Administration made the relatively huge fine (100,000 for individuals, 200,000 for corporations), but it didn't mention the condition for regional copyright administrative department. Because of the too huge amount in former measures, the parties' legitimate interests couldn't be protected effectively. Therefore, the revised measures unified the standard for hearing of witnesses and stipulated that before copyright administrative department made the relatively huge fine or decisions according to laws and administrative regulations, the department should inform the parties that they had rights to apply for holding hearings. The "relatively huge fine" means more than 20,000 yuan for individuals or 100,000 yuan for corporations.
The Measures also stipulated that if the parties asked for hearing of witnesses, copyright administrative department should organized the hearings in accordance with the Article 42 of Administrative Penalization Law and didn't be allowed to charge the parties any fees for it.
Meanwhile, administrative law-enforcing officers could take measures to stop the illegal acts, perpetuate the evidences in an emergency and put on record after that. The officers found that if they didn't take any measure to investigate and collect evidences, the works that infringing on others' rights would be missed easily. Therefore, the new Measures added the provisions of "emergency measures" and strengthened the administrative law-enforcing measures according to relating laws. In accordance with the Measures, the law-enforcing officers could take following measures if the situation is emergent and there have no time to put on record in advance: stop or correct the illegal acts; register and preserve the materials, implements, equipments that mainly were used for illegal act; collect and investigate relating evidences.
For the dealers of copyright products in the market, if they could not prove the legal source of the products, they shall bear the legal responsibility in accordance with the Measures.
The Measures added burden of adducing evidence of suspected infringer based on the provisions of Copyright Law of China. According to the Article 52 of Copyright Law, a publisher or a producer of reproductions who fails to prove that he is legally authorized publishing or producing of the reproductions shall bear legal liabilities. So the Measures stipulated that the person who had the forced obligation to adduce evidence must introduce them before the deadline that was designated by copyright administrative department. If the publisher, producer, distributor or renter who was suspected failed to prove that he had legal authorization or legal source, the law-enforcing officers could made administrative penalty. The provision was also applicable to preserver, keeper or transporter who failed to prove the legal authorization or legal source of the reproductions.
The provision further strengthened the burden of adducing evidence of suspected infringer. It was beneficial for copyright law-enforcing department to strike acts of infringement and improve the efficiency of administrative law-enforcing.
New provisions concerning management of non-trade selling and paying foreign exchange for transnational corporations have been formulated
For improving management of non-trade selling and paying foreign exchange and promoting the development of economy concerning foreign affairs, State Administration of Foreign Exchange formulated selling and paying foreign exchange policies for all kinds of non-trade fees that were paid by transnational corporations and associated corporations. The policies will go into effect in Beijing, Shanghai and Shenzhen first.
The provisions defined the transnational corporation, its associated enterprises in China, and its enterprises outside China. Transnational corporations included: the foreign capital corporations who have set up the foreign investment enterprise upon approval of foreign economy and trade administrative department; the Chinese group company that specialized foreign business upon the approval of related administrative departments. The associated enterprise of transnational corporations in China included: branch company of foreign capital corporations and foreign investment enterprise that was owned or held its shares by foreign capital corporations; branch company that was established by its headquarters or associated company outside China and foreign investment enterprise that was owned or held its shares by its headquarters or associated company outside China; branch company or subsidiary that was set up by Chinese group company upon the approval of related administrative departments. The associated company outside China of transnational corporations included: branch company was established by headquarters of foreign capital transnational corporations in foreign countries and regions (included Hong Kong, Macao, Taiwan, same below) and the company that was owned or hold its shares directly or indirectly by foreign capital transnational corporations; branch company or subsidiary that was set up by Chinese group company outside China.
In the following conditions, companies could hold payment notice, related certificates and pay from its foreign exchange account in designated bank or buy foreign exchange for payment: transnational corporation and its associated companies in China pay aboard the wages and allowances of their employers who hold the nationality of foreign counties, employers from Hong Kong, Macao and Taiwan or Chinese employers who hold the permanent right of residence in foreign countries (generally called "foreign employers" below); remit abroad directly the wages and allowances of foreign employers; pay for the insurance premium such as society, medical, retirement of foreign employers or remit abroad directly the fees mentioned above; pay for the fees of traveling and training abroad of their employers; pay for the fees for exploitation of patent, specially authorized rights and technologies; pay for the management fees and other fees.
Profit deposit of foreign investment could be sent back.
State Administration of Foreign Exchange promulgated Circular Concerning Returning Profit Deposit of Foreign Investment in July, 2003.
The Circular rescinded the system of profit deposit of foreign investment and stipulated that the deposit would be returned to investor.
From the issuing date of the Circular to March 31, 2004, all branch bureaus and foreign administrative departments should return the profit deposit to investor. Behind the deadline, the investor would be regarded as giving up all the rights and interests related to the deposit.
If the investor had bankrupted, liquidated or broken up, the deposit that they paid would not be returned.
The policies for current account management of foreign exchange under the items such as international construction contract have been revised.
On Oct. 15, 2002, State Administration of Foreign Exchange promulgated Circular Concerning Readjusting the Policies of Current Account Management under the items such as International Construction Contract. For improving enterprise's international competition advantages in market economic actions, State Administration of Foreign Exchange decided to readjust the policies of current account management under the items such as international construction contract.
The Circular stipulated that the following current account would be brought into the management of current account with special source and designated purpose and the limited amount would be checked and ratified as their all foreign exchange income:
1. The current account of international construction contract and international labour service;
2. The current account of international shipment, ship transportation agency and freight transportation agency;
3. The current account of international bids or tenders;
4. The current account of foreign exchange that earned outside China and needed to be transferred to institutions or individuals in China.
All institutions in China that fit for the 4 sections mentioned above and have current account may apply for readjusting the limited amount of current account in branches of State Administration of Foreign Exchange after the performance of the Circular.
Infringing upon the copyright of computer software:
The person who was complained should provide evidences to prove the legal source of software that he used.
The approval and reply of National Copyright Administration to its Zhejiang Branch expressed clearly that according to China's Copyright Law and Protection Provisions for Computer Software, if the person who was complained failed to prove the legal source of the works and computer software that he produced or issued, he would bear the legal responsibilities.
Meanwhile, if the expression measures that could be selected were limited, software could be similar or same and didn't establish infringement. But the similar or same software must be created respectively and not be the reproduction of other's software. If the party who was complained made a rejoinder with the reason of "limited expression measures", he will bear burden of introducing evidences on this point. If he fails to provide effective evidences, he shall bear responsibilities for infringement.
