Editor's note: While the Internet offers great opportunities for businesses due to the extensive range of customers, copyright piracy is a global challenge for content providers. In addition to protecting their own content, businesses are also challenged by the protection of customer data in today's online world. How do rights holders effectively protect copyrighted works in china? Given the fact that in China most websites do not have a formal privacy policy, how do Internet users expect the Chinese legal framework to protect their personal privacy?

Richard W. Wigley, a consultant of King & Wood's IP Litigation Group in Beijing, gives a comparison of laws and practices in China and the United States on copyright enforcement and privacy protection over the Internet.

China Business Weekly will publish the article in the following weeks. Below is the third part of it. Some minor changes have been made to the author's original article for editorial purposes. The views expressed here are the author's own.

The courts in China are divided into basic courts, intermediate courts, high courts and the supreme court. The court where the initial dispute is brought is known as the court of first instance, while the appellate court is known as the second instance court. This appellate system is similar to that which is in place in the United States.

In major metropolitan areas, the intermediate court will be the court of first instance for many intellectual property cases. Jurisdictions in major metropolitan areas such as Beijing, Shanghai and Guangzhou handle the majority of intellectual property cases. Because of this specialized capability and the associated protection existing largely only in major metropolitan areas, there should be a heightened awareness among companies in China with regard to where they bring claims in Chinese courts. Venue, as such, becomes a very important issue when litigating intellectual property claims in China.

In some courts within China, the ability of the local judiciary to address a complex intellectual property case may be an issue. Similar to the United States where judges are virtually always experienced attorneys, China's judiciary has subsequent to the passage in 1995 of the Judges Law aggressively moved toward a judiciary which has an academic background in the law.

In addition, special intellectual property courts have been set up within the Intermediate courts of many major cities, where the judiciary has been specially trained to deal with intellectual property casework. The specialized background and training of the intellectual property judiciary allows for effective mediation (an attempt at mediation by the judge is required as a precursor to trials in China) and adjudication of copyright claims in China.

The jurisdiction and associated venue for adjudication of cases in China is based upon where the defendant has his domicile or where the infringing act has taken place. Specific to copyright infringement claims against multiple defendants (for instance, a manufacturer of infringing goods and its distributor), the plaintiff may choose the People's Court in the place where one of the defendants has committed an infringing act.

For foreign or domestic companies seeking to bring infringement actions against defendants in major Chinese cities such as Beijing, Shanghai, and Guangzhou, the Chinese judicial system offers a viable alternative for adjudication of even the most complex of copyright cases.

Plaintiffs bringing infringement actions against defendants in lower-tier cities or rural locations should, however, give due consideration to jurisdiction and venue options when contemplating adjudication of IPR claims in these less-developed areas. Irrespective of the location, however, the heightened education requirements for the judiciary and growing experience with intellectual property casework have benefited both Chinese and foreign copyright holders in judicial proceedings in China.

In 2007 the Chinese courts dealt with 17,395 civil intellectual property cases, according to the State Intellectual Property Office (SIPO). This is a markedly different situation from 20 years ago when only a few dozen cases would be adjudicated per year. Additionally, in 2007, 2,684 criminal cases involving IPR infringement were addressed by Chinese courts, resulting in 4,322 criminals being punished, indicate figures from SIPO. These figures represent a willingness of Chinese and foreign companies and individuals to trust the Chinese court system to fairly adjudicate their respective claims.

Since the landmark case of A&M Records, Inc. v. Napster, Inc, courts in the United States have established strong precedents for the protection of copyright over the Internet.

With the explosive growth of the Internet in China have come a number of landmark cases regarding copyright infringement over the Internet. Most prominent among these decisions have been those brought by foreign and domestic copyright owners against search engines for providing links to infringing content.

In a recent case, the Beijing high court upheld a copyright infringement decision against Yahoo.com.cn, which is majority owned by Alibaba, which had been found liable for copyright infringement for providing links to infringing content. This decision, as well as others upholding the copyright of foreign and domestic rights holders has led to an increased level of confidence in the Chinese judiciary in handling these often complex and highly controversial cases.

Whether it will be through administrative or judicial enforcement, civil or criminal action, copyright holders have viable mechanisms to protect their rights in today's China. These controls have not been in place for as long as in developed countries such as the United States, but much progress has been made in the past decade in China. Though levels of copyright infringement still remain high in China, foreign and domestic copyright holders can look to a bright future for both the monetization and protection of their valuable content over the Internet.

(China Daily 12/08/2008 page9)