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China – Land of the Copycats?

Written by Mustapha Shaldoum on 25 March 2017

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China is undoubtedly a land rich in innovative history. Gunpowder, printing, paper and the compass were all devised there. Today, in visiting China you will be able to keep in touch with loved ones using the ‘HiPhone’, shop for groceries at the ‘7-12’ convenience stores, dine out at one of the ‘KFG fried chicken’ restaurants and drive home in a ‘LandWind X7’.

Today, China have been attempting to keep up with Western advances by more legitimate means – such as hiring experts, buying out new businesses or keeping a close eye on publicly available information.

However, suspicious (at best) and illegal (more likely) practices continue. Pelamis Wave Power Ltd, an innovative Edinburgh-based manufacturer of wave energy converters, noticed several laptops went missing following a visit from a team of Chinese delegates. It was only a few years later Pelamis, a now bankrupt company, noticed a remarkably similar technology pop-up in China. 

The theft of sensitive, or technological information is an issue for companies visiting China. Companies are advised to travel with ‘clean’ smartphones and laptops. These precautions are a drop in the ocean with regards to intellectual property protection when pitted against the threat posed by hackers on the internet.

The Director of the US National Security Agency described commercial cyber-attacks as “the greatest transfer of wealth in history”, $240bn a year of which us carried out by Chinese perpetrators.

This view has been assiduously rebutted by President Xi Jinping claiming, “The Chinese government does not engage in theft of commercial secrets in any form, nor does it encourage or support Chinese companies to engage in such practices in any way.”

China, though having been caught with their hand in the cookie jar, are not alone in their Intellectual Property indiscretions. 18th Century French explorers returned from the Porcelain capital, Jingdezhen with detailed information on pottery techniques and designs.

However, clear international agreements on Intellectual Property law did not exist in the 18th Century, so it may be hard to draw too many comparisons. Furthermore, the invention of the internet has created a means whereby stealing another’s Intellectual Property has become more simple than at any time through history.

Today, Intellectual Property expert Dr Shen, has warned the courts could soon become overwhelmed by the number of domestic cases – potentially lessening instances of blatant, unashamed counterfeiting of goods.

In 2015, China and the UK signed a Cybersecurity Pact following “disturbing” levels of cyber-attacks on British companies which, according to GCHQ, originate in China and Russia. 

Though the Pact was met with widespread skepticism Dmitri Alperovitch, co-founder of cybersecurity firm CrowdStrike, says intrusions in the UK, New Zealand, the US, Canada and Australia have fallen by as much as 90% since the signing of the agreement. Alperovitch cites the reason for these staggering results is down to hackers preferring to target domestic businesses.

The greater the advances in Chinese technology, the more important intellectual property becomes to Chinese business owners. This will almost inevitably generate social discourse on the topic of intellectual property if those business owners are receiving insufficient protection for their hard work.

This would surely be great for China, and the repercussions would surely be felt throughout the wider business world.

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