China IP's Journalists ("J"): Hong Kong is an economically developed region with its own outstanding features. Are there any connections or differences between Hong Kong and other advanced countries and regions such as USA, Europe, UK and Australia with respect to the establishment and practices of their intellectual property (IP) systems?

Ms. Pancy SH Fung ("F"): Hong Kong's IP protection system has a long history. As early as in 1874, Hong Kong started trademark registration. The Trademark Registration Department established in Hong Kong at that time is one of the oldest in the world, even older than its counterpart in the UK. Besides, the history of copyright protection in Hong Kong is over 90 years old. The year 1997 marked the beginning of Hong Kong patent law localization. It has been 16 years since the Intellectual Property Department (IPD) was established in 1990. Before the establishment of IPD, other governmental authorities were in charge of handling IP issues in Hong Kong. At that time, the government noticed that it was necessary to establish a specific authority for the regulation of IP issues and for the recruitment and training of IP professionals.

I started my work at IPD in 1992, and also have a 'long history' in dealing with IP issues. After more than a decade, I have a better understanding of the importance of IP. One feature of Hong Kong's IP system is that it functions under the governing policy of "one country, two systems". Under this policy and Article 8 of the Basic Law, all the laws previously in force in Hong Kong, including the common law, remain valid, except for any laws that contravene the Basic Law, and are subject to amendment by the legislature of the Hong Kong Special Administrative Region. For instance, with regards to IP law, unregistered trademarks are under the protection of existing common law. Under Article 139 and 140 of the Basic Law, Hong Kong SAR is entitled to pass laws and propose policies to protect IP. For example, Hong Kong's trademarks, patents and designs are required to be registered in the Mainland for protection. Similarly, trademarks, patents and designs registered in the Mainland cannot automatically obtain IP protection in Hong Kong, but must also be registered in Hong Kong to gain protection.

As in other advanced countries, Hong Kong's IP system is in conformity with the standards specified in relevant international treaties. In addition, Hong Kong is a WTO member, and Hong Kong's IP system is in complete conformity with the standards of TRIPS. There are quite a few advantages to Hong Kong's IP protection system. For example, in January 2005, Hong Kong Customs was the first to take action against the copyright infringement of "Peer-to-Peer File Sharing Systems", arresting a person for allegedly displaying three copyrighted films by using Bit Torrent (BT), a "peer-to-peer software". In October 2005, the court found the defendant guilty. This is the first BT infringement case duly punished and the ruling has a preventive and deterrent effect to such future infringements.

J: Are there any new developments for Hong Kong's IP law system?

F: The fascination with IP law lies in its fast development for its close relationship with science and society. Hong Kong's IPD is subordinated to the Administration of Science, Industry and Commerce. Though it is not long after Hong Kong's return, there are several new amendments to the IP law, which reflect the development of society as well as science and technology and create a good environment for the development of Hong Kong's economy. 

J: Do these new developments emphasize Hong Kong's own unique features or are they more consistent with IP development trends in the rest of the world ?

F: As I just mentioned, Hong Kong's IP system is in conformity with the standards specified in relevant international treaties, including WTO's TRIPS. In terms of legal relationship, Hong Kong surely shall abide by and apply these international treaties. But these international treaties only stipulate the minimum requirements. Hong Kong is required to make IP laws which can primarily promote the development of this region based on its own specific circumstances and then ensure its enforcement.

In 1997, the patent law and design law of Hong Kong began to be localized. We had two patent forms: and the standard patent, for which the protection term is 20 years. The protection term of the short-term patent is 8 years; and the protection term of the design patent is 25 years. In Hong Kong, the granting of a standard patent is based on the patent registration granted by three designated patent authorities, which respectively are: the State Intellectual Property Office of the PRC (SIPO), United Kingdom Patent Office and European Patent Office (designating the United Kingdom). The granting of Hong Kong's short-term patent will be made on the basis of the examination report provided by an international examination authority or a designated authority.

In 2003 we made a new Trademarks Law with reference to the new developments in other places, which permits the registration of trademarks for taste and sound, and which has greatly reduced the trademark application fee. Furthermore, as it is inconvenient to apply for only one class of trademark with one application form, the applicant may apply for more than one class of goods with only one application. As there are more than 40 classifications of goods for trademark registration, this measure may be more convenient for applicants who have large businesses to put various classes of goods together in one application. This may make it easier to provide timely protection.

With regard to the copyright law, under the 2001 Copyright Ordinance, one may be subject to certain criminal liabilities if he or she uses pirated software for business purposes even though he or she does not sell such software. The Copyright Regulation was amended again in 2003 due to the public's proposal to cancel the restrictions over parallel imported computer software. They believed that permitting parallel imported computer software would promote market competition and increase the availability of such products so that consumers would have more choices and buy products at lower prices. After the amended Regulation came into force, the parallel import restriction no longer applied to goods containing computer programs (generally referred to as "computer software products"). If the main sales of computer software products involve music, sound, video, film, TV films, electronic books or combinations of the above, then the aforesaid restriction shall be applied.

For further improvement of Hong Kong's copyright protection and exemption system, HKSAR government announced the draft of the 2006 Copyright (Suspension of Amendments) on  March16, 2006. The draft regulation reflects the consultations of the past two years and makes reference to relevant international standards and the latest developments of society and science, and the requests of owners and users of copyrighted works. The draft regulation is being discussed by competent draft commissions. For details of the draft regulation, please go to IPD's website (www.ipd.gov.hk). 

J: The awareness of trademark protection in Hong Kong commercial establishments is believed to be good. But you mentioned that there were some misunderstandings when you gave lectures on the Mainland. Would you please give us a special introduction to the trademark and company registration systems in Hong Kong? Is this area very significant for relevant commercial establishments, and is it the area in which they have the greatest concern from an IP perspective?

F: From 2004 on, IPD has been sponsoring an annual survey over Hong Kong's commercial establishments' knowledge of IP, and this year marks the 3rd survey. We noticed from the results of the 2006 survey on businesses' awareness of IP that 54% of the surveyed business people have the following misunderstanding: Having a certain business name or registered company name may be enough to prevent others from using the name as a trademark. The failure of enterprises to register their own trademarks may lead to insufficient protection for the trademarks in Hong Kong.

For business operators or citizens in Hong Kong, the registration of company names, business names and trademarks are subject to different laws and regulations. Registration of company names shall be conducted in the company registration office; registration of business names shall be conducted in the Commercial Registration Department of the Tax Administration, and trademark registration shall be conducted in the Trademark Registration Department. The registration of a business or company name does not include the right to own such names as trademarks. Only by formally registering the trademark in Hong Kong will the trademark owner enjoy the protection for a registered trademark.

IPD provides a free Internet index service, so any person may freely check the registered trademarks, registered trademark owners, and materials regarding the person or company licensed to use relevant trademarks in HKSPR via the Internet. In order to clarify the misunderstanding of some enterprises concerning Hong Kong's IP system, IPD arranged or participated in various activities to promote the awareness of Hong Kong's IP system to Hong Kong's citizens and enterprises and to local governmental officials on the Mainland. In order to strengthen the promotion of different trademark protections and company registration, IPD sponsored a series of promotional activities and lectures on the Mainland and in Hong Kong.

In addition, there are series of articles introducing company registration and trademark protection in the IPD's website (www. Ipd.gov.hk), and the data base of IPR materials for Guangdong Province, Hong Kong and Macao (www.ip-prd.net) is available for the reference of citizens. IPD will strengthen relevant promotional activities together with the company registration authority. I do hope the survey will see significant positive changes next year.

J: What kind of convenience is provided by the Hong Kong IP electronic service?

F: Hong Kong IP electronic services began in 2003. The government provides a free electronic index service. Parties concerned may submit applications for patent, trademark and design via the Internet.

From November 2005 on, the new electronic service includes an interactive electronic service. There are many advantages with interactive services: the applications from the parties concerned may have a timely, quick, convenient and accurate settlement. The parties using the interactive services do not need to send us materials and there will be no middle-men, so it may reduce mistakes and hasten correction. Now via the Internet the applicant may amend, extend and correct names and addresses at any place around the clock.

The scope of the electronic service includes: amendment of names, addresses, agents addresses and delivery addresses, the extension of trademarks and patents, the extension of time requirements and trademark applications, and trademark transfer applications.

We've done a good job. People from different places, including Singapore and the UK, come to communicate with us. In September 2005, the General Administration for Industry and Commerce of PRC also dispatched workers for exchanges with us on electronic services.

In August 2006, the applications for trademark, patent and design submitted electronically were 52.5%, 38.3% and 43.1%, respectively, of the total applications during this month.  These figures indicate that electronic submission service is welcomed by users.  We hope to further promote its use. The advantage of Hong Kong is that it is an international metropolis with a high degree of IPR protection awareness  and has a high proportion of computer and Internet use.

J: Among all the applications for IP registration in Hong Kong, trademark applications from Hong Kong take up 41%; short-term patent applications, 61%; design registration applications, 46%; and standard patent applications, 1%. Is this related to Hong Kong's economic position and features? What is the possible tendency?

F: These figures indicate improvement in IP awareness among Hong Kong's citizens. In fact, as I have already mentioned, IPD has been sponsoring a survey on the public's awareness of IP for 3 years, and the results announced in May 2006 show that more than 98.5% of the surveyed people are aware that IPR includes copyrights, trademarks and patents. The surveyed people believe that IPR needs protection in Hong Kong's commercial sector (96.7%) and that IPR is the valuable property of companies (97.1%).

In addition, from 1999, IPD has conducted a survey concerning the awareness of citizens, with this being the 7th year. The results announced in January 2006 show that, since the first survey in 1999, there has been a great improvement in the public's awareness of IPR. In 2006, 84.7% of the people surveyed are aware that IPR includes copyrights, trademarks and patents, while the proportion in 1999 was only 50.6%.

These figures also demonstrate the guarantee that Hong Kong's IP system provides for a sound economic and social environment. Hong Kong is an international city with most of its trademark applications coming from outside Hong Kong, a demonstration of its vitality and charm as a metropolis. As to short term patents, most come from Hong Kong natives. This illustrates that innovation in Hong Kong is very active, extensive and practical. Similarly, Hong Kong natives make up a relatively high proportion of industrial designs among those registered in Hong Kong, which is further evidence of the Hong Kong people's innovation and attention to the quality of goods with novel designs that appeal to consumer tastes. 

As for the development tendency, the quantity and quality of IP innovations in Hong Kong will keep gaining momentum. As an international city, Hong Kong is capable of attracting investment with its excellent environment which is constantly improving. We not only have an effective legal framework, but also strict, reliable enforcement. What we seek most is the improvement of the public's awareness of IPR to diminish IPR infringements until they are finally eliminated. Further, we seek to excel at creating our own IP for the development of our undertakings while respecting others' IPR.

HK SAR's Innovation and Science Department has done much work for the promotion of innovation and science, including the creation of the patent application fund plan. This plan will help local companies and persons to apply for their own inventions in the form of fund allocation. The maximum amount of each approved application may reach 100,000 HK dollars or 90% of the total amount of the patent application fee (which ever amount is lower). The patent application fund plan has received 1,374 applications from April 1998 to March 2006, among which 546 applications have been approved and another 91 applications are in the process. Among the approved applications, 232 applications have successfully obtained patents. In addition, 154 funded inventions have been utilized as patented products or technology for market applications. This plan is going well, and has reached the aim of encouraging local inventors to apply for patent s to protect their IPR.  

J: In November 2005 when the movie Harry Potter and the Goblet of Fire was being shown, an anti-piracy promotion film jointly acted by Mr. Arnold Schwarzenegger, Governor of California, and Hong Kong actor Jackie Chan was first shown in Hong Kong. It is said that this represented a joint action by Schwarzenegger, Jackie Chan and Hong Kong IPD to take strong measures against the piracy of copyrights. Surely this anti-piracy promotion film also appeared in the Mainland. What is the people's IPR awareness in such an economically developed region as Hong Kong? Are publicity and education still necessary? 

F: Hong Kong people's awareness of IPR has improved quickly, as can be seen by the figures I have just mentioned. In Hong Kong, the publicity and education programs have been in place for nearly 10 years. The education has taken place primarily in schools. Now there are various individuals and groups that need to be educated about IP, which include citizens, schools / young people, enterprises and governmental authorities. The Hong Kong government invests 700 million HK dollars for this promotional work. As to the form of publicity, we pay attention to attractions that rally our citizens. We invited Mr. Arnold Schwarzenegger and Jackie Chan to produce a publicity film and the feedback is very good. We also make electronic games for the publicity of IPR.

We try to find the most effective way to express the topic of IPR promotion. Our moves are acclaimed internationally. APEC has two members whose good publicity is praised: one is Hong Kong and the other is Australia. In November, Hong Kong will cooperate with two other APEC members, i.e. Australia and Singapore, to establish a workshop with the topic of public education of IPR. We hope to assist other economic systems with the improvement of their IPR public education.

Just now I mentioned that IPD sponsors an annual survey to ascertain the citizen's awareness of IPR. The result of this year's survey indicates that the percentage of the interviewees admitting downloading files illegally and then sharing them with others via the internet rose from 3.5% in 2003 to 6.8% in 2005.This shows that peer-to-peer file sharing is more common. This survey report provides us with a better understanding of the situation of citizen's sharing files via internet. We must focus on public education, enforcement and legislation in this respect.

We also hope to enhance the IPR management ability of enterprises (especially small and media-sized enterprises) through publicity and education, enabling them to protect their interests and rights more effectively so as to develop their business and create wealth with IPR.      

J: Would you please say something about the relationship between economic development and IPR?

F: This issue shall be explored from a macro perspective. With respect to Nature, the climate of a place is one of its environmental conditions. For an economic society, the IPR condition is one of its economic conditions. In order to understand this relationship, we can compare from an economic development perspective places that have many IPRs and good protection, and other places that have few IPRs and bad protection.

I think it is very important to maintain IPR protection in every place. The law for the protection of antiquities may remain intact for many years, but advanced IPR laws need to keep pace with the times and reflect the development of science and technology. Of course, IPR involves not only legislation, but also many other aspects such as law enforcement and public education, etc. Therefore, the unwavering improvement and safeguarding of Hong Kong's IPR is required for the protection of the local social and economic development environment.

J: As you are in charge of communications between Hong Kong IPD and its counterpart on the Mainland, would you please give an introduction concerning the relationship between the development of IPR in Hong Kong and that on the Mainland?

F: The relationship is very close. We have contacts with central institutions, including sponsoring annual IPR seminars among the Mainland, Hong Kong and Macao over the past 10 years. In addition, there are some other communications, for example, the Trademark Office of State Administration for Industry and Commerce of the PRC dispatched personnel to communicate with us on the electronic interactive service. SIPO also dispatched officials to explore the IPR agent service in Hong Kong.

The communication with localities is very extensive. In 2005, the IP departments of Hong Kong, Macao and nine provinces signed the Pan-Pearl River Delta IPR Cooperation Agreement. Hong Kong and Guangdong Province established the Hong Kong and Guangdong Province IPR Protection Cooperation Team. As of 2003, the IPR cooperation between Hong Kong and Guangdong Province has successfully made relevant IPR authorities in both places establish a closer relationship.

I am willing to talk about 3 objectives of the communications between Hong Kong and the Mainland. The first objective is to save resources and enforce legislation, as well as to promote IPR through strengthening the cooperation and exchanges between Hong Kong and the relevant authorities on the Mainland. The second objective is to enhance the IPR awareness of Hong Kong's small and medium-sized enterprises operating on the Mainland and in Hong Kong. The third objective is to make people and enterprises on the Mainland knowlegeable about Hong Kong's IP system and encourage them to take advantage of the professional services in Hong Kong to guarantee their interests and rights related to IPR in Hong Kong and in other places.

Hong Kong is an international city located in a place combining Asian and Western cultures.  Historically, Hong Kong people understood more about the mentality of Western people. As Hong Kong's IPR professional personnel are familiar with international market operations and legal systems and have a good command of English, they can act as bridges helping Mainland enterprises to deal with the outside world and to become the media base for foreign economic cooperation. IPR professionals on the Mainland are familiar with Chinese market operations and relevant laws. The IPR professionals from Hong Kong and the Mainland expect to continue their good cooperation. 
 
J: Thank you for the interview!

F: Thank you and thank China IP as well.

Relevant links: 
    The Basic Law of the Hong Kong Special Administrative Region of the People's Republic of China
    Article 8  The laws previously in force in Hong Kong, that is, the common law, rules of equity, ordinances, subordinate legislation and customary law shall be maintained, except for any that contravene this Law, and subject to any amendment by the legislature of the Hong Kong Special Administrative Region.
    Article 139  The Government of the Hong Kong Special Administrative Region shall, on its own, formulate policies on science and technology and protect by law achievements in scientific and technological research, patents, discoveries and inventions.
    The Government of the Hong Kong Special Administrative Region shall, on its own, decide on the scientific and technological standards and specifications applicable in Hong Kong.
    Article 140  The Government of the Hong Kong Special Administrative Region shall, on its own, formulate policies on culture and protect by law the achievements and the lawful rights and interests of authors in their literary and artistic creation.

                                                                                      (Translated by Luo Duoqun)