China’s copyright laws offer limited help to the multi-national music labels on preventing internet users from illegally downloading music from search engines. As the population of internet users has continued to grow rapidly in past years, China has seen the infringement of music labels’ copyrights at a level that is almost out of control.
Last year, the court ruled that one of China’s largest e-commerce giants, Yahoo China, had violated copyright law by providing music search engine services and ordered that the company indemnify the plaintiffs for economic losses and reasonable court fees. However, Baidu. com, another e-commerce giant that won a case before the new Internet Copyright Law could take effect in 2006, is still providing the same kind of search engine services, dramatically damaging the music industry’s revenues. Efforts to protect the music industry remain weak China.
“[The] Baidu case is a headache indeed,” said Xiaodi An, partner at An, Tian, Zhang & Partners. Since people in China rely so much on the search engines on a daily basis or for work-related convenience, to shut down the search engine companies would cause a great impact to the community, he said. However, An said that currently, Baidu and other search engines provide a huge assistance for privacy. “This is the fact, but we cannot forbid search engines simply for that. This is the dilemma.”
According to the Regulations on Protection of the Right of Dissemination through Information Networks, if someone or any platform provides convenience or assistance to infringement, that person or internet platform is liable for copyright infringement.
“Of course, the new regulation is procopyright owners, to the extent that it clarifies that search engines such as Yahoo and Baidu should not facilitate the unauthorized free downloading of music, and by extension, video files, through deeplinking” said Ai-Leen Lim, partner at Bird & Bird’s IP Group in Hong Kong. However, it is unclear how effective the Law could be when it comes to affording practical protection to copyright owners.
“China has a huge internet user population, which experts estimate will overtake the US internet user population by the end of 2008, if not earlier” Lim said. “The new regulation is not deterrent enough. Search engines can afford to pay the maximum fine prescribed by the same, namely Rmb100,000, if they choose to flout the Law and bear the fine.”
Lim also said that industry observers and the legal fraternity generally see that the Chinese government is more focused on regulating the media rather than dealing with the rampant file sharing problem in China. “For instance, in late 2007, in seeking to curb pornography and politically sensitive online subjects, the government announced [that] only state-owned entities would be allowed to apply for licenses that allow for sharing of audio or video files online.” Lim said.
As the Internet user population in China has become the largest in the world, Lim said it is almost impossible to completely resolve the problem of Internet copyright infringement in the country. To avoid fighting an endless battle, it is necessary for the music industry to cooperate with technology companies and explore opportunities for revenue-sharing rather than wrestling against each other over copyrights, she said.
As a practitioner working for copyright owners, An said he is dissatisfied with the government’s efforts in copyright protection in China. “The government is not doing enough on enforcement. You can find infringed contents such as Hollywood films or online music everywhere in China. I don’t think the administrative authority is acting actively. It is very unfair to the copyright owners,” he said.
However, it will always be a challenge to effectively control the circulation of content on the internet, said Audrey Shum, IP senior associate of Clifford Chance. IP rights issues are common problems in a developing country like China, she said. “Developed countries are also not immune from the same problem. For example, the US faces the same Internet privacy problem (if not more serious) due to the more widespread use of technology,” said Shum. In comparison to 10 to 15 years ago, when it was almost impossible to bring an effective legal action against a local company for IP infringement, most judges in more developed cities like Beijing, Guangdong or Shanghai nowadays are professionally trained and experienced in handling IP cases, she said. “It is always a game of catching up. The government and the legislators will always have to balance the rights and interests of different interest groups,” she said.