Experts on intellectual property rights protection applauded increased compensation for copyright infringements in a newly released draft law, viewing it as a bigger threat to copycats and a stronger tool to fight piracy. In the draft revision to the Chinese Copyright Law, if a copyright owner clarifies the cost of using his or her works, people using the works without paying or those deliberately infringing on the copyright will be ordered to pay five times the cost in compensation, the China Daily reports. Meanwhile, the ceiling for compensation that pirates will face has been increased to CNY5 million in the draft – up from CNY500,000 – when the cost of infringing on a copyright is not clear or when the loss to copyright holders and benefits gained by violators cannot be determined. The draft was submitted on April 26 to the bimonthly session of the Standing Committee of the National People’s Congress (NPC) for a first of three readings before being adopted. “Raising the compensation as a heavier punishment will be effective in deterring copycats, especially those in cyberspace, as it’s easier to plagiarize works online and the infringement cost is also much lower than it is in traditional ways,” Liu Bin, an IP lawyer from Beijing Zhongwen Law Firm, said.

He gave a thumbs-up to the CNY5 million for undetermined damages in the draft, adding that the current CNY500,000 compensation is not a large amount of money for copyright violators compared with their illicit gains. Liu Junhai, Law Professor at Renmin University of China said “the key to copyright protection is to make sure the penalty is higher than the gains from violations”. Besides the harsher punishment, the draft has added protection for new types of works in the internet era, including short videos, live-streaming and online dramas, “which I think is urgent and essential,” said Kang Lixia, a lawyer specializing in IP-related disputes at the Beijing Conzen Law Firm. Copyright cases have made up about 60% of IP-related disputes in recent years. The Copyright Law was put into effect in 1991 and amended in 2001 and 2010.

The Chinese Patent Law, which is still being reviewed, will also raise compensation to a range of CNY100,000 to CNY5 million when the loss to patent holders and the benefits gained by infringers cannot be determined. The current range is CNY10,000 to CNY1 million, the China Daily reports.

In related copyright news, Shanghai’s market watchdog imposed administrative penalties on seven trademark applicants and four trademark application agencies for preemptive trademark registrations related to the coronavirus epidemic. The applicants applied for trademark registrations of Huoshenshan Hospital, Leishenshan Hospital and Dr Li Wenliang, which infringes others’ rights and violates China’s trademark law and related regulations, the Shanghai Administration for Market Regulation said. The seven applicants, including Shanghai Tubo Internet Science and Technology Co and Shanghai Diqi New Material Science and Technology Co would be fined CNY10,000 each. The four agencies, including the Shanghai Jiacheng Trademark Agency and Shanghai Jinshan Trademark Agency, would be fined up to CNY85,000 for violating China’s trademark law.

The parties filed trademark applications although they were aware that it was a malicious registration, the Administration said. Huoshenshan and Leishenshan are the names of makeshift hospitals built in Wuhan, the city hit hardest by the epidemic in Hubei province, to treat Covid-19 patients. Both have ceased operation as the epidemic wanes within the country. Dr Li Wenliang is known as one of the first whistle-blowers who warned the public of the coronavirus and later died of the disease. Li is widely known in China, while the two hospitals were registered as public institutions on January 27. These have prior rights to these names, said Pan Lei, an Administration official. The Shanghai Intellectual Property Administration has ordered the four agencies to withdraw their applications. Heads of the companies and agencies involved will face punishments as well, the Shanghai Daily reports.