Chinese Copy Right

Whenever the topic of intellectual property protection comes up in discussion my Chinese colleagues inevitably quip, “In China we don’t need copyright laws, we already know how to ‘copy right’.”

And it’s true.  Writing in China Daily, columnist Raymond Zhou, in discussing “The Chinese obsession with reproducing elements of the existing world…” notes that “The Chinese have a weakness for imitation…”, going on to note that iconic landmarks like the Sydney Opera House and the Beijing National Stadium, otherwise known as the Bird’s Nest, inevitably get replicated across the country in scaled-down versions.

Mr. Zhou entertainingly notes that man-made structures often become associated with the natural world or objects with which they bear some visual similarity.  In addition to the Bird’s Nest, Beijing alone is home to the “Giant Egg” (the National Center for the Performing Arts) and the “Big Pants” (CCTV headquarters), although he goes on to add that occupants of the latter are less than enthusiastic about the association for obvious reasons.

The peaks of an actual mountain range are instantly recognizable in the Chinese character for mountain.
The peaks of an actual mountain range are instantly recognizable in the Chinese character for mountain.

Zhou postulates that such literal association has its roots in the Chinese language.  The original pictograms, or Chinese characters, were often symbolic replicas of the objects they defined and still today exhibit signs of their literal origin.  In the character for mountain, for example, you can still see the three peaks of the original pictogram and the character for mouth is easy to guess with it’s wide open space in the middle.

A predilection to association, however, and the prevalence of intellectual property theft for which Chinese business has acquired a level of universal ignominy are two different things.  The former is fun.  The latter involves serious money and undermines one of the core principles at the heart of all developed economies.

And it is a problem.  The government itself has put the protection of intellectual property rights high on their agenda, a commitment necessitated by the country’s entry into the WTO.   And every foreign company who has invested here has wrestled with the issue.

But why is it such a problem?   Why do the Chinese not accept the same standards of IP protection embraced by the rest of the developed world?  Or do they?

Extreme poverty changes everything.
Extreme poverty changes everything.

First of all, whenever you talk about theft, you have to accept that in the bowels of abject poverty theft can be as much about survival as morality.  If your family is starving even the most pious man is likely to be tempted to take the loaf of bread cooling on the windowsill of the local baker.  And despite the glamor of world-class cities like Beijing and Shanghai, there’s still plenty of serious poverty in China.

That’s only a partial explanation, however.  Corporations are as likely to steal the IP of their competitors as the poor tailor is to knock off a Hermes scarf.

Another part of the explanation comes back to the distinctive worldview on which Chinese culture is based.  While Western standards of morality tend to be very linear and absolute, Chinese standards are much more contextual and shaped by notions of personal obligation.  How you might treat a stranger, in other words, is held to a different standard than how you treat a member of the family.

And since corporations are institutions, not people, it is perhaps no surprise that the Chinese grant them few moral rights or privileges.  They simply do not personalize institutions to the extent that Westerners often do.  To them, remember, all relationships are personal.

All of the land in China belongs to society as a whole.
All of the land in China belongs to society as a whole.

And there is, of course, a conceptual spillover from the Chinese political system that comes into play as well.  Fairness, to the socialist, is an issue of equity rather than the rights of personal claim.  No one in China, for example, can own land.  Whatever claim you might otherwise make to it, the land belongs to the people, managed, of course, under the custodial eye of the government.

But can we equate intellectual property with land?  Is intellectual property a natural resource that rightfully belongs to society as a whole?  The Western capitalist, of course, would offer an emphatic ‘no’.  Creative entrepreneurs, capitalist theory goes, will not entrepreneut if there is no return on their entrepreneution.

When, however, does creation become an issue of timing, or even luck, rather than creative genius?  And when, more importantly, do the needs of society at large outweigh the financial rights of the individual or corporation?

These are tricky questions without simple, concise answers.  Without treading into the murky waters of intellectual property law, however, even the most IP friendly Western legal codes clearly acknowledge their existence.  Seldom do Western IP laws grant absolute and perpetual rights of ownership.  There are almost always limits to the duration of the protection and myriad requirements that the IP holder demonstrate commercial use and/or demonstrated effort to uphold ownership rights.

I spent months trying, unsuccessfully, to find a retailer of DVD's that were not pirated.  "Who would buy them?" was the inevitable refrain.
I spent months trying, unsuccessfully, to find a retailer of DVD’s that were not pirated. “Who would buy them?” was the inevitable refrain.

The Western bench, in other words, has sought to define the most classically Western solution to the universal conflict inherent between IP holders and would be beneficiaries – the ‘win-win’ solution.  IP holders get enough protection to recoup their investment and make some money, but not so much as to deprive society of the benefit of IP that might otherwise have come into existence in myriad different ways.

But what if your worldview isn’t as linear as the Western worldview?  What if your relational and holistic worldview seeks not to achieve ‘win-win’ solutions, but ‘win-lose’ solutions, on the theory that everyone is capable of fending for themselves and the obligation for not losing belongs with the potential loser in the same sense, as we discussed in another post, that the responsibility for effective communication belongs with the listener, not the speaker.

An official Disney licensee?
An official Disney licensee?

The Chinese, in other words, don’t fundamentally look at intellectual property any differently than Westerners do.  They just draw the dividing line between public and personal property, and personal right and collective good, at a different point along the moral and legal continuum.

Whatever the source of the gap between China and the West in their efforts to grapple with the IP dilemma, there is little question that foreign businesses operating here will have to take robust precautions to protect the intellectual property they hold dear.  In this case, caution is more than an admonition.  It is a necessity.

And if you’re like most Western companies operating here that will inevitably mean disabling USB ports on computers, isolating sensitive documents to encrypted servers only accessible to those with an absolute need to know, outsourcing the construction of critical equipment in isolated parts to multiple vendors, and, in extreme cases, leaving your best technology at home.  (I don’t recommend this latter strategy.  I can almost guarantee you will not be successful here without it.)

But each of these strategies is, once again, a testimony to the Western preoccupation with process.  Each strategy focuses on the data and technology itself, treating the IP as a distinct and independent entity – a definable institution, if you will.

Here, however, I suggest you take a page from the Chinese worldview, by which everything turns on relationship, not process.  In the end, you see, your greatest vulnerability is not the processes you employ to protect your intellectual property.  Your greatest vulnerability is the people you employ to deploy your processes, the people who have both your knowledge and experience in how to apply it.

This is where your competitors will go when they want to know your secrets.  Contrary to a lot of contemporary IP (i.e. fiction), they won’t infiltrate your secure network or attempt to sneak into your offices in the dark of night in black Ninja uniforms.

All relationships are personal in China.  If competitors want to know your secrets they will look to your employees first.
All relationships are personal in China. If competitors want to know your secrets they will look to your employees first.

They will stand outside the gate of your plant, in broad daylight, and politely ‘obtain’ leads from your departing employees until they have correctly identified the one man or woman who has the information they seek.  And then they will work, perhaps harder than you, to make a new friend – to develop guanxi – a relationship of mutual obligation.

So if you really want to protect your intellectual property in China, secure your people as fervently as you secure your networks.  Put the same effort into retaining your people that you put into protecting your trade secrets and you will, in the end, end up with better protection than could ever be achieved through process alone.

And you will enjoy the added benefit of employees who are both motivated and loyal, employees equipped to deploy the most powerful weapon in the arsenal of intellectual property protection – a commitment to innovation that leads to a constant stream of new and more valuable intellectual property.

A woman's silk scarf from HEBMES of Paris.
A woman’s silk scarf from HEBMES of Paris.

Copyright © 2013 Glassmaker in China

Notice:  The views expressed in this post are strictly those of the writer acting in a personal capacity.  They are not in any way endorsed or sanctioned by his employer or any other individual with which he may be personally or professionally affiliated.