Anti-Counterfeiting Strategy In Taiwan©Part I of II
Autumn, 2004 

Field of Endeavor

The present article relates to Intellectual Property Rights (IPRs), and more particularly to the anti-counterfeiting strategy for protecting IPRs in Taiwan.


Background Statement

Since IPRs are getting more and more important in this knowledge-based era, it is generally believed that anti-counterfeiting legislation and attitude adopted in a country are measurements for indicating whether the country is a developed, advanced or IPR-protecting one.  If yes, she might have a better economic environment and would be regarded as a place where businesspersons would like to invest and do their businesses.

Before an anti-counterfeiting strategy in a specific country is considered, the following events must have happened and/or been considered:

1. There are one or more IPRs in the specific country.  Before this can happen, it goes without saying that there must be an IP law protecting the IPR;

2. There are one or more persons who engage in counterfeiting a product protected by the IPRs.  Before this can happen, it is natural that the technological level in the country allows those persons to engage in such counterfeiting actions;

3. There are one or more laws in the specific country which can be applied to curb the product-counterfeiting actions.  Before this can really work, she must have realized through being pressed or educated that anti-counterfeiting measures will help her become economically better in the future;

4. There are one or more times where anti-counterfeiting measures taken by her relevant authorities are not satisfactory.  This must be true before we need to work out a strategy for the anti-counterfeiting matter;

5. There are one or more alternatives to which the anti-counterfeiting remedies can resort by which the anti-counterfeiting effect can better be improved.  This must be true since the matter cannot be rectified if no alternative can be utilized;

6. There exists a set of empirical rules or steps through which an IPR owner can follow in order to better protect its IPRs.  This must be true before the word “strategy” can come to existence for the present article.

Since a sound legislation is anticipated to improving or providing the best predictability as to what will result from a legal behavior, if it really is, not only it would be self-explanatory for a law-offender to understand what legal consequence it is to bear but also it is clear and easy for the injured to take a legal measure for being remedied.  The word, strategy, itself gives rise to an expression that a person who can contribute or propose a correct, sound and/or wonderful strategy is a great, wise and/or talented one by whom a sound strategy becomes available.  Now, the following questions come:

1. If the relevant legislation is sound, there will be no necessity for people to figure out what are best strategies in enforcing the rights in each country.  Since every law firm in every country tries to provide a strategy for enforcing IPRs or anti-counterfeiting in each respective country, does this mean on this earth, there is no country capable of enacting sound legislation?  If not, why does every law practitioner in each respective country badly love to introduce or create respective strategy?

2. If the involved legislation is not sound, it appears to be very strange because the congresspersons or legislators consume so many resources without any limitation in each country to do only one job of enacting the law so that how it could be imagined that this could happen?  If yes, why it bother us to write/read this article?

3. The real scenario must not be as simple as the above-described.  Otherwise, anything relating to the word, strategy, must violate the spirits of having a law, or alternatively, any law must attract no relevant strategy.  Accordingly, it might be reasonable for us to reason as follows:

A. A specific law is intended to provide norms for matters in a specific aspect so that it is enacted in a sense to make relevant matters clear rather than to provide remedies for the infringed;

B. A strategy is intended to organize or produce possible or potential measures an involved party could exercise and is often derived from many laws.  Since the targets or purposes to be respectively dealt with by the law and the strategy are different, the law and the strategy are not necessitated to be directly inter-dependent and/or interlinked with each other although they should be mutually relevant;

C. It is said that the human being tends to take advantages of everything including the law itself.  If this is really or partly true, a strategy is therefore imaginable, necessary or desirable even if the law itself is soundly perfect because correctly applying the law and/or avoiding the application of the law in themselves are never easily understandable to a layperson;

D. Furthermore, if there really exist flaws or defects in the law, it becomes natural that a well-deployed strategy will win most significant due or undue benefits for the involved party.

4. Accordingly, since it appears that every law might ensue a strategy to its own, we had better not question and/or discuss any more whether a strategy to which kind is necessary or not.


Summary of Developments

Although there are some disputes as to whether or not the IP laws really boom the propulsion of the research and development in the industry and/or boost the prosperity of the technical level of a specific country, it goes easily to experience that we can hardly find out a country nowadays without an IP law legislation.  Although we cannot know how much we can attribute to such legislation, the achieved modern substance civilization partly or significantly driven by IP laws has brought forth kinds of conveniences for the human being if we pretend not to mind whether our living environment is subject to vital threats through unnecessary waste and/or competition by consuming various resources.

Counterfeits come from market demands generally coming from the desire for physical or spiritual enjoyment generally coming from necessity or vanity normally happening to a human life normally tried to be made better by the human being who creates IP laws, manufactures counterfeits and tries to develop a strategy to curb counterfeits being hard to be banned if the technological level in the specific country allows counterfeits resembling or even superior to genuine products under one’s regular logical understanding.

In this economy-directed era, politicians always try to solicit votes through oral pleadings as to how and why they could make economical achievements for the people or their country, which is generally made possible by creating an economic environment which can be successfully formed partly through formulating a economic law-framework normally containing therein one or more laws which can be applied to curb the product-counterfeiting actions in order to publicize the image that she is an IP-respecting country in which an IP owner needs not worry whether it can legally make money as long as its IPR-protected products are really welcome in the market.  For a strong IP country, she might have better IP provisions whereas for an IP-less-advanced country, she might have finally realized only through being pressed or educated that anti-counterfeiting measures would help her become economically better in the future.

Although there is a saying that the history always repeats in itself so that we tend to come across identical or similar events, we are living on earth though accumulation of past experiences and/or knowledge.  If anti-counterfeiting measures petitioned to be taken by relevant authorities in a specific country are satisfactory, there will be no chance that we are writing this article.  Although we cannot know whether we can really propose or contribute some kind of strategy for the anti-counterfeiting matter in Taiwan, we are trying here to see whether this article can really be informative.

As long as there is a necessity to be involved in a strategy, there must be one or more alternatives to which (we, matters or) the anti-counterfeiting remedies can resort by which the anti-counterfeiting effect can better be improved.  This must be true since the matter cannot be rectified if no alternative can be utilized.  Even in daily life, we can find there really are tactics or strategies by which we can do the matter in a smoother or more efficient way.  It goes without saying that there must be strategy for anti-counterfeiting purpose, which should never be easily achievable obtainable when compared to that for the daily life.

As is known, this world is always changing with time for every nanosecond.  Although a changing society or environment will not come into norm by a certain strategies, there must exist a set of empirical rules or steps, at least statistically, through which an IPR owner can follow in order to better protect its IPRs.  This recognition must come before the word strategy can come to existence for the present topic in this article.

So far as the anti-counterfeiting strategy in a specific country is concerned, it is believed the following 5 factors are significantly involved in and need be dealt with before we can know what the anti-counterfeiting strategy is in the specific country:


Brief Items to be Discussed for Presenting Issues We Concern

*The substantive laws of the specific country

*The habits and customs of the specific country

*The economic and developed degree of the specific country

*The enforcement laws of the specific country

*The enforcement environment of the specific country

We would like to respectively examine the above five factors in Taiwan before we can respectively reach a conclusion as to what the anti-counterfeiting strategy for a specific consideration is in Taiwan.


Detailed Analyses

The substantive laws of anti-counterfeiting in Taiwan

As is known, IPRs include patent rights, trademark rights and copyrights.  In the past, our Patent Law includes therein criminal provisions for infringement on either an invention patent, or a utility model patent or a design patent.  All criminal provisions were able to be deleted only until early 2003.  Trademark Law and Copyright Law still contain therein heavy criminal punishments though quite a few scholars claim that all IPRs are economic laws.  Accordingly, criminal provisions shall not be incorporated in the laws since economic problems shall be only resolved by economic solutions rather than criminal ones in their views.

As a matter of fact, heavy criminal punishments in the laws of Taiwan largely come from the pressures of the US since US businesses or tycoons make complaints to the US government, which in turn applies a great pressure to the Taiwan government whose officials generally trust the US is the most important diplomatic support of Taiwan and are normally pliable to the pressures from the US administration.  The reasons why the US administration applies pressures to the Taiwan government in adopting the grave criminal provisions are based on the following assumptions:

1. Relevant US businesses have lost a lot of economic interests through counterfeiting actions in Taiwan;

2. Relevant US businesses will face problems of subsistence if counterfeiting actions continue to happen in Taiwan; and

3. The quality of counterfeiting goods made in Taiwan is not inferior to or even is superior to that of the genuine source.

Accordingly, so far as the substantive laws for anti-counterfeiting are concerned, it should be easy for one to believe that Taiwan has an encouraging anti-counterfeiting law protecting environment.  Let us take a brief look at the following 2 out of 14 penal articles in Taiwan Copyright Law as examples to have an initial idea about what is believed as above.

Article 91

Whoever infringes another’s proprietary copyright by means of reproduction through profit-making intention shall be punished with imprisonment for not more than 5 years, detention, or in lieu thereof or in addition thereto a fine over NT$200,000 but not exceeding NT$2,000,000.

Whoever infringes another’s proprietary copyright by means of reproduction of not more than 5 copies without a profit-making intention or with an infringing sum over NT$30,000 when calculated on the basis of market price of obtaining legal works at the time of seizure shall be punished with imprisonment for not more than 3 years, detention, or in lieu thereof or in addition thereto a fine not exceeding NT$750,000.

Whoever offends the crime of the first paragraph by means of reproduction through CD shall be punished with imprisonment for not more than 5 years, detention, or in lieu thereof or in addition thereto a fine over NT$500,000 but not exceeding NT$5,000,000.

Article 94

“Whoever habitually offends the crimes of Articles 91(1), 91(2), 91bis, 92 or 93 shall be punished with imprisonment for over 1 year but not more than 5 years, or in addition thereto a fine over NT$300,000 but not exceeding NT$3,000,000.

Whoever habitually offends the crime of Article 91(3) shall be punished with imprisonment for over 1 year but not more than 5 years, detention, or in addition thereto a fine over NT$800,000 but not exceeding NT$8,000,000.”

Although the period of the imprisonment might not be the highest in this world or the punishments stipulated here might not be the gravest, it is believed that the stern extent for the above-described is never loose.


The habits and customs relating to anti-counterfeiting in Taiwan

The Taiwan culture mainly branches from The Chinese culture.  Traditionally, a literary person was proud of the fact that his (her) article was so wonderful as to be possible for being caused widespread all over the nation even without being monetarily compensated because he or she would believe and feel having been compensated enough through his (her) name having been well-known to the world.  Although the literary person can still feel satisfied because nearly every one would pay hearty respects to him/her capable of creating a masterpiece, it is uneasy for him/her to become a rich person. 

Such situation has been changed a lot by IPRs created by the Western society.  Although the author of Harry Potter sighed out that she has gained too much through her books, it is clear that not every author could have her luck or fortune to be flooded with money or have the mind or conscience to feel satisfied.  Although IPRs have made it possible that the inventors or authors can become rich persons, there are voices that establishing a creation industry rather than a cultural environment might not be a very good phenomenon, which, however, is not a topic here.

Although IPRs have changed this country a lot, unless having the experiences of being pursued, it appears that people in the middle and/or lower classes do not care much about whether goods they buy are counterfeits but care much about whether goods they buy have acceptable or desired quality and/or price.  We do not want to confess or admit that middle and/or lower classes of our nationals are meaner in personalities since it is never seldom reported that quite a few people, including those who belong to the upper class, coming from countries all over the world are very fond of purchasing counterfeits here.  Instead, taking the trademark as an example, what we need to reconsider for such social phenomenon might include:

1. Whether the genuine products cost too much?

2. Why the quality of counterfeits need not be poorer than that of genuine ones?

3. Is it good or necessary for the society or world to become brand-oriented?

4. Does the world need famous trademark?

5. Is it necessitated that goods of a famous trademark must be expensive?

Again, the above questions are not topics to be discussed here but we want to make it clear that the above questions need not be raised merely from viewpoints from the consumers or scholars.  Specifically, trademark owners might also be benefited after having potential partial solutions to the above issues through due considerations and/or meditations.

For coping with this factor from the trademark aspect, the suggested strategies would be:

1. Trying to divide consumers into different levels to be respectively provided with goods of different grades/qualities to be sold at different prices;

2. Tough pursuit of any possible infringement in order to effectively curb any future potential infringement;

3. Trying to link national sentiment of local consumers with a specific trademark by sponsoring kinds of activities in a specific country in order to improve the image of the specific trademark and to engrave in the mind of local consumers that it is proud to own a goods having the specific trademark so that it is absolutely worthy of costing some money to own such goods.

Habits and customs cannot be switched or changed very soon because they are historically formed in a certain period of time and can only be phased in or out historically either through intentionally formatting or randomly or optionally plasticizing activities or events.


The economic and developed degrees in Taiwan

It appears well-known that Taiwan has and/or had some economic miracles.  It also seems that Taiwan has been categorized as a developed country.  Accordingly, so far as economic and developed degrees are concerned, Taiwan is a good place for which we would like to express:

1. Taiwan might be a good place to do business;

2. Taiwan offers a good market environment to do business although it might be true that our market scale is relatively small;

3. Taiwan might be a good place to make money;

4. Taiwan might be a good place to do investments; and

5. Taiwan might be a place to live at.

Although the criminal rate is increasing and the society is getting more and more westernized, generally speaking, it is very easy to find Taiwanese are kind and easy to get along with.  We are only telling the truth but not advertising or promoting for our country here since we are not paid by our country to say so.

Turning back to our topic here, the modern economic society has the features of consuming a lot of everything.  So far as the economic booming condition is concerned, it seems that consuming is pretty welcome by every body all over the world since it would mean that there will be working opportunities for producing various staples to be consumed.  From some viewpoints of earth resources, consuming would mean wasting, which, however, has not been regarded as a very serious problem yet.  In traditional Chinese society, saving is a virtue and an important merit for evaluating a person.  It has been uneasy to find out a young person here who will much value any usable or reusable resources because any resource is economically quantified and can be easily replaced as long as the user has the resource to own or make money.  Although a salary receiver normally will have a not-bad income from the viewpoint of the old generation capable of affording the life without even spending more than 30% of the received salary, it is not seldom to find out the phenomenon that the salary receiver of the young generation needs financial helps from his/her parents for spending purpose over the full month.  This means:

1. That the younger generation in Taiwan contributes a lot to the consumption of goods or resources, which means that the general public is easy to get frantic about a popular product, which means that a business needs not worry about whether its products can find a market in Taiwan as long as it is certain that the product it produces is popular.  Certainly, we must confess that as a relatively small island, Taiwan market itself is not large, especially in this globalized era, the volume can never be large if a product is specifically provided for circulation only in a local rather than an international market.  Fortunately, Taiwan is a good place to arrange a product, national or international, to be produced cost-efficiently;

2. That Taiwan is a place of volume consumption as long as the provider can arouse interests of the general public.  Although it appears this is true everywhere on earth, we are confident to advise that any enterprise shall not take the financial or economic power of Taiwanese as a consideration, an issue or a factor for volume consumption;

3. That Taiwan is a place to consume expensive products.  This means that there generally are rich persons who do not knit their brows in buying an expensive product as long as the provider can drive them to exercise such behavior.  This might not be very true since one can easily find in Taiwan without much difficulties that there are even people of the younger generation who do not contract their brows either upon buying quasi-expensive products which are objectively considered beyond their financial capability from something like a relatively conservative viewpoint;

4. That Taiwan is suitable for being brand-oriented, either categorized in levels or classes, or devoted to only a certain rank or class of consumers.

The above analyses might somehow be doubted in that it appears to be made from the viewpoint of the younger.  As a matter of fact, even people of the older generation are getting more and more brand-oriented and forgetful about the saving virtue because to win an administration through election, the government is supposed to take care of any one who has no money in the pocket to live with.  As a result, the above analyses should either be fully or partly correct or hardly wrong finally.  Accordingly, the only problem left here is how a business can create a hot or popular product attracting money from pockets of people of any tier of age from various ranks all over the world. 

More specifically, although we raise the question as to whether this world needs a famous trademark in the above, we did not mean that this world needs not a famous trademark, which normally can satisfy, at least emotionally, the consumer.  As is understood, when one is satisfied, he/she will not cause troubles or other waste to the world or even will do something helpful to the world although we are not sure whether some troubles have been aroused before he/she gets the money to get himself/herself at least emotionally satisfied.  It goes without saying that when more and more famous trademarks have been registered and have ever been enforced and a more developed degree has been achieved in a country, the country and her nationals must have a popular recognition that IPRs are important and should be respected.


The enforcement laws in Taiw an

The Taiwan economy relies a lot on international trades.  As a small island, we do have done quite a big trading.  Although our yearly income is not bad, the life indexes here are not low.  More importantly, commercial advertisements drive our various potential desires to be completed by devoting ourselves to hard work for making money to satisfy our desires, which might be unnecessary in leading an ideal life.  From the viewpoint of a philosopher, a peaceful but colorful life does not necessitate so many modern desires, which cost so much money and consume so many resources.  Nevertheless, in this complex and complicate world, due to not small trading volume, Taiwan is subject to foreign pressures to not only provide enough substantive legal protections for IPRs as described above but also provide effective enforcing legal framework therefor.

We would like to outline procedures for enforcing IP Rights in Taiwan hereinafter.  Specifically, as neatly shown in the attached flowchart, alternatives for enforcing IPRs in Taiwan include as follows:

1. Criminal private complaint: The right owner can institute a legal proceeding against the infringer if the injured legal interests belong to an individual.  Since there has been no criminal punishment for the patent infringement under the current Patent Law and the trademark violation belongs to the purview of public complaint, only certain copyright offences can be pursued by such private complaint.  After complained, the district court will try and decide on the case.  The first instant decision can be appealed to the competent High Court and then finally to the Supreme Court if the offence is not a crime which cannot be sentenced to more than 3 years or damages or claims involved in are more than NT$1,500,000.

2. Complaint to the public prosecutor: Since the trademark law is taken to be public law so that all offenses relating thereto must be indicted through the public prosecutor, so are some significant offences under the Copyright Law.  Pursuing a criminal through this route must be processed by the court also only after the investigation has been performed by the public prosecutor.  If no indictment is rendered thereby, the complainer can petition a reconsideration to the general prosecutor in the High Court.

3. Written complaint or verbal report to the judicial police: The judicial police here includes the 2nd Security Police Group of and the Criminal Investigation Section and Administration Section in the National Police Administration, the Criminal Investigation Corps and Economic Affairs Division of the Police Bureau in each County or City, the Investigation Bureau of the Department of Judicial Affairs which mainly deals with major crimes but will accept such complaint or report when they take they are not so busy, and the Criminal Investigation Bureau and Economic Affairs Section of a Branch Police Bureau.  After receiving such complaint or report, the office will initially investigate the matter.  If finding founded, the office will petition for a search warrant in order to perform a search or raid during which a seizure might be made if offending articles are present.  Thereafter, the case is referred to the Prosecutor’s Office in the competent district court.

4. Written complaint or verbal report to a quasi-judicial authority: The quasi-judicial authority includes various Customs and Coast Guard Administration.  The procedures to be followed are generally the same as those of the judicial police above-described except that the seizure needs not happen outside of but normally are at their offices.

5. Requesting helps from private associations: IPRs owners establish quite a lot of associations in order to enforce their IPRs.  Since they are private entities, they cannot exercise any public power to perform their rights.  Instead, they can only do some private prior verification and refer the case to the judicial police for further processing in order that the latter can further proceed with the matter in an efficient and speedy manner.  Sometimes, if an industrial association is credible, its opinions will be highly valued by the authority or the judicial police.  Examples of such associations include IFPI (International Federation of the Phonographic Industry) Members Foundation in Taiwan, Business Software Alliance and Anti-Counterfeiting Coalition.