On Feb. 17, 2005, the U.S. Patent and Trademark Office (USPTO) sponsored a seminar for the U.S. industry and government agencies on the Chinese criminal justice system for intellectual property (IP) offenses. During which, a bureaucrat declared to the press that "improving the environment for U.S. companies doing business in China and addressing widespread counterfeiting and piracy" was a major goal of the current administration.

China has continued work on its IP-related regulations post-WTO with the latest round as of Dec. 2004, when monetary thresholds for counterfeit and pirated goods were reduced. U.S. and European businesses continue to closely watch China's compliance in the IPR area.

Yet, compliance is inadequate. Just last December, Hitachi Global Storage Technologies sued China's 1-inch disk drive manufacturer GS Magicstor for infringement on several Hitachi patents. Earlier this year, SigmaTel sued Actions Semiconductor, a Guangdong-based IC design house for IP violation related to certain controller ICs. And Semiconductor Mfg International Corp. (SMIC) has settled the lawsuit brought against it by Taiwan Semiconductor Mfg Co. (TSMC) with an agreement to pay the Taiwan foundry $175 million over the next six years.

The alleged reluctance to comply or the inability to enforce IPR protection has often been explained by cultural differences, poor infrastructure for monitoring and the lack of awareness. I'm throwing another factor into the mix. With industry observers and lawyers debating the adequacy of well-established patent laws, should countries relatively new to the concept of patenting be expected to adopt a U.S.-based system lock, stock and barrel?

The practice of obtaining exclusive rights over inventions has existed for a long time and for various reasons. Some believe it might have existed as early as 500 B.C. in Greece, where monopolies were granted to new culinary dishes for a period of one year. Later, the guild system facilitated the process of protecting and propagating the techniques of a craft, which were the communal property of the guild. England used an early form of patenting to encourage domestic production of goods. Some believe that Queen Elizabeth I used the system to reward the faithful, something her successor James I could not carry on for long with the enactment of the Statute of Monopolies Act in 1623.

The first U.S. Patent Act of 1790 had another objective to serve: to encourage innovation. Patenting would reward an inventor with temporary monopoly and the inventor would disclose details of the invention so that anyone could offer improvements after the period of the patent. The Act of 1790, which lasted three years, has been revised and "re-codified" several times since then.

Proponents of debate on this law suggest, among other things, re-defining what is admissible for patenting, particularly in relation to biological matter or discoveries vs. inventions, and the duration of patents. They say the Act today encourages corporations to protect their interests by patenting whatever they feel can be patented. That restricts innovation—a result contrary to original designs.

Is it any surprise then that two Chinese DVD player manufacturers, Wuxi Multimedia and Orient Power Digital Technology, have sued consumer electronics giants Philips, Sony, Pioneer and LG Electronics, alleging they violated U.S. antitrust laws in the licensing of patented technologies?

This is a difficult issue to objectively take a stand on. Even Thomas Jefferson found himself in both camps. At one instance he said, "He, who receives an idea from me, receives instruction himself without lessening mine; as he who lights his taper at mine, receives light without darkening me...Inventions then cannot, in nature, be a subject of property." And at another, "Certainly, an inventor ought to be allowed a right to the benefit of his invention for some certain time."

While I sit on the fence in this debate, I urge you—current and potential inventors—to form and express opinion on this subject. For it is you for whom any law on patents and monopolies should work.

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