Anti-Counterfeiting in China

September 19, 2003
Anti-Counterfeiting in China

By Kan Zu
I. Over view of Counterfeiting in China
i Size and Scope of Counterfeiting
ii Characters of Counterfeiting
II. Laws for anti-counterfeiting
i Trademark Law and Anti-Unfair Competition Law
ii Law on Products Quality
iii Regulations of the People?s Republic of China Regarding Customs Protection of Intellectual Property
iv Chinese Criminal Law
III. Problems in Anti-Counterfeiting
i Local Protectionism
ii Problem of Enforcing the Law
iii Blank of the Law
IV. Suggested Measures to Address Counterfeiting in China
V. Conclusion

Anti-Counterfeiting in China
By Kan Zu
For the past decades, counterfeiting has reached critical levels in the PRC. It is estimated that 15 to 20 percent of brand products in China are counterfeit. The influx of cheap, low quality counterfeits hurts companies both by limiting the market demand for legitimate products and by destroying the goodwill for products that depend on reputations for good quality. This problem has been complicated by the growth of export, as China has now become a leading exporter in a growing global market for counterfeit products.
Serious counterfeiting in China has attracted more attention from both domestic and overseas, especially from multinational companies. In 2000, 49 multinational companies headed by Procter & Gamble Co. banded together as members of the Quality Brand Protection Council (QBPC) under the China Association of Foreign-Invested Enterprise to wage a protracted battle against counterfeit product manufacturers and dealers throughout China.

I. Over view of Counterfeiting in China
The recent rise of counterfeiting in the PRC can be traced to China?s unprecedented economic development, the rise of consumer wealth and spending power, and the development of well-known brands. In the past two decades, China?s consumer economy grew from annual wholesales turnover of RMB 126 billion in 1979 to RMB 2.7 trillion or USD 325 billion in 1997, a more than twenty-fold increase .
Historically, the economies of many countries, including the United States, have encountered significant counterfeiting once a certain stage of development is reached. What is unusual in world history is the magnitude of the problem in China. The unprecedented growth of the economy has led to a surge in counterfeiting that has outpaced the many efforts of the Chinese government to control it, resulting in a counterfeiting problem that in terms of size, scope, and severity appears to have no parallels in history.
Counterfeiting is harmful to China?s interests both in the short and the long term. In the short term, Chinese consumers and brand owners continue to suffer serious harm from counterfeiting. Consumers frequently suffer serious injury and even death from adulterated, inferior quality counterfeit products. The Chinese government also loses substantial tax revenues as a result of counterfeiting, since virtually no counterfeiters pay taxes of any kind. Statistics from the China Association of Foreign-Invested Enterprises show that there is not much difference between the volume of counterfeit products and the smuggled volume. The sales volume of counterfeit products on the Chinese market is probably larger than that of the smuggled volume. According to statistics, the ratio of tax revenues to domestic sales is 14.47 percent. A rough calculation based on the estimated amount of counterfeit products on the national market shows that the loss of tax revenues on the part of the state caused by counterfeit products in 1998 was some RMB 18.77 billion [US$ 2.3 billion]. In addition, the loss of tax revenues from tobacco in 1998 was about RMB5.8 billion [US$ 700.5 million]. Thus, the loss of China?s tax revenues rose to RMB 24.57 billion [US$ 3 billion], accounting for 3.24 percent of the state?s industrial and commercial tax and enterprise income tax.
The recent sharp increase in the export of counterfeit goods further damages local and foreign brand owners. Counterfeiting harms the intangible assets of enterprises worldwide, including famous trademarks and brands they have established through spending large sums of money and energy over many years. Now that counterfeiting imperils not only their China bottom line, but also their home markets, foreign brand owners are going to public to fight the fakes. ?A considerable part of fake P & G products have even been exported to East Asian countries, affecting the international reputation of P & G.? If the situation continues, the international reputation of Chinese products will be severely damaged, and Chinese exports will diminish accordingly.
In the long term, counterfeiting harms China?s continuing economic development and drive for industrialization and modernization. Local brands and local industries suffer consistent losses, impeding them from developing strong brand names, consumer goodwill, and significantly inhibiting their potential growth. The losses currently suffered by foreign investors in China as a result of counterfeiting may cause foreign companies to consider foregoing further investment in China. A report from the Development Research Center of the State Council points out that counterfeit product manufacturing and marketing has seriously impacted China?s investment environment. Almost one-third of the foreign-funded enterprises say that counterfeiting directly affects their expansion plans. Some are considering reducing their investment in China as the rights to their products have been seriously infringed upon. Two foreign-invested enterprises have even expressed their intention to withdraw from their investment.
Chinese authorities have already recognized that ?the continuing flow of counterfeit goods is damaging China?s international reputation?. And this harm to the country?s reputation likewise may have a significant impact on the decision of foreign investors.

i. Size and Scope of Counterfeiting
Trademark counterfeiting involves making a copy of a company?s trademark item, such as a logo or a clothes tag, and passing the goods off as the product of that company. Counterfeit products will almost invariably bear a registered or unregistered trademark of another party and often the company name, address of the lawful manufacture or trademark owner.
Counterfeiting is not a copying of the package of design and/or partial of full copying of the trademark of another party. In most cases, counterfeits are manufactured by illegal and unlicensed nameless factories.
Losses from counterfeiting now account for as much as 15% to 20% of the total sales revenues for some QBPC member companies. Estimates of lost revenues of eight members of the QBPC alone total almost USD 300 million per year. Other QBPC companies and local Chinese companies suffer losses on a similar scale.
The total volume of counterfeits in the market in most cases substantially exceeds 15% to 20% of the sales revenues of these companies.
In 1998, the Administrations of Industry and Commerce (AICs) nationwide seized over 400 million counterfeit and trademark infringing goods in raids. The Technical Supervision Bureaus (TSBs) confiscated additional counterfeit product worth USD 20.4 million. These figures refer only to goods actually sized and can only represent a tiny fraction of the fake products that were produced and sold.
Based on the factors above, and taking into consideration the size of the Chinese consumer economy (USD 325 billion per year), the percentage of total sales lost by many consumer brand companies as a result of counterfeiting (15% to 20%), and the amount of counterfeit goods actually seized by administrative enforcement authorities, it is reasonable to assume that total losses from counterfeiting in China are in the hundreds of billions of Renminbi each year or tens of billions of US dollars.

ii. Characters of Counterfeiting
1) The means employed by counterfeiters in committing acts of counterfeiting have become even more craftily disguised and the counterfeiters are sophisticated. They use secret signals in making contacts, deploy ?sentries? when committing their offences, adopt the practice of transporting forged trademarks and counterfeit, inferior quality goods separately and on their arriving at the place of dealing, they attach the representations of trademarks to the goods while making sales. When I conducted a raid action in Chaoyang city, Guangdong province, I got the information that the counterfeiters had installed a network of hidden closed circuit television cameras inside and outside the factory.
Also, the false representations of trademarks have come to bear an increasingly closer resemblance to the genuine ones. ?this is a serious problem and the counterfeiters are getting more and more sophisticated every day. The packaging is often so sophisticated you cannot tell them apart from the real thing.?
2) The businessman from Hong Kong or Taiwan involved in counterfeiting account for a fairly large portion. The counterfeiting is often masterminded by unscrupulous businessmen from Taiwan and Hong Kong who have moved their counterfeiting operations into China because of stricter regulation at home and the cheap labour on the mainland. Between 50 and 80 percent of trademark violations involved a Hong Kong or Taiwan connection. A typical case is usually in the following pattern: a Hong Kong or Taiwan businessman provides an enterprise in the China mainland with technical data and key parts and stipulates the trademark, trade name, ornament, design, etc. to be used, and the enterprise in the mainland will make the products. If the products are sold abroad, the businessman will undertake to be the sole agent. Many cases of counterfeiting foreign famous brand products have occurred with the scheming and participation of these Hong Kong or Taiwan businessmen, even the businessmen from other countries, while some enterprises in the mainland have in turn learned the methods and experience of counterfeiting from such businessmen so that the phenomenon of counterfeiting has become even more serious and complicated.
3) Manufacturers and dealers are binding together establishing a manufacturing-distribution network. Manufacturers and dealers of fake products have established increasingly closer ties. The manufacturers not only deliver goods to the door, but offer credit sales or guarantee dealers against losses from punishment for selling fake goods so that the dealers can sell fake products without cost or at low cost. Problem stems from the counterfeiters' decentralized and professional manufacturing, packaging and distribution networks. They often enjoy protection from local officials, and many counterfeiters have even established risk funds for use when members are arrested by authorities. Dealers often mix fake and real products when they sell fake goods, such as replacing part of an independently packed real product with a fake one.
4) Counterfeits had found their way to the international marketplace. Mainland counterfeiters now have a new incentive to scour the world to find other goods to copy and export. During the past decade, the number of fake products exports from China worldwide increased sharply, causing a global problem. Products entering global markets ran the gamut of manufactured goods, from toys and electronic games to consumer electronics and handbags. Nike Inc. complained that fake Nike sport shoes made in China are now available around the world. In 1999, four customs offices in China captured 20-odd batches of fake Nike products. Since 1996, the value of fake products seized at customs has continued increasing. According to customs statistics, between January 1999 and August 1999, customs seized a total of 400-odd batches of fake goods for export nationwide, worth RMB 94 million. Fake Gillette blades flood Russia and Eastern Europe, dud Duracell batteries turn up in the States, phony Philips Electronics irons in Brazil, and exploding cigarette lighters can be found in Spain. In 1998 alone, U.S. customs officials seized China-made fakes worth some US$30 million.
5) Multinationals in Dilemma
Seeing fake products flooding the markets, many factories dare not fight against them. This is because when consumers learn that the products of a company are being cheaply reproduced, a great negative response arises in the public, resulting in a decline in sales volume.
Such tolerance and compromise have made fake product manufacturers and dealers become more unscrupulous.

II. Laws and Government Authorities for Anti-Counterfeiting

For intellectual property infringement, China has dual enforcement system to make settlement, one is judicial approach and the other is administrative approach. The administrative approach, non-judicial procedure, is to claim an intellectual property infringement before the government authorities and seek remedies. The administrative approach is the unique and efficient way to deal with intellectual property infringement, especially for trademark infringement and counterfeiting cases. The administrative procedure has aspects as followings in settling intellectual property infringement.
(1) Dispute could be resolved quicker than judicial procedure;
(2) The cost is lower than judicial procedure;
(3) Dispute can be settled more thoroughly without any side effect, and the interests of the intellectual property owners can be protected.
There are obvious benefit from the current administrative enforcement system in China, including the provision of multiple options in pursuing infringements and access to a much higher number of enforcement officials than is the case in other countries. Indeed, notwithstanding their inability to impose jail terms on infringers, foreign brand owners have been impressed with the speed and reliability of the AICs and TSBs in providing rapid seizures against counterfeits and infringing items over the last two decades.
China's dual enforcement system clearly seems to be the most appropriate system for China, given the country's special conditions and historical circumstances.
China promulgated many laws related to anti-counterfeiting and under these laws many government authorities involve in the anti-counterfeiting.

i. Trademark Law and Anti-Unfair Competition Law
Article 38 of Chinese Trademark Law enumerates four actions as infringement of trademark exclusive rights, (1) to use a trademark that is identical with or similar to a registered trademark in respect of the same or similar goods without the authorization of the proprietor of the registered trademark; (2) to sell goods that he knows bear a counterfeited registered trademark; (3) to counterfeit, or to make, without authorization, representations of a registered trademark of another person, or to sell such representations of a registered trademark as were counterfeited, or made without authorization; (4) to cause, in other respects, prejudice to the exclusive right of another person to use a registered trademark.
Chinese Anti-Unfair Competition Law is also an important law for anti-counterfeiting. ?China has a multi-level legal system to protect foreign investor intellectual property rights that includes the Trademark Law, Patent Law and Copyright Law, at the lower level, and the Anti-Unfair Competition Law at a higher level.? Chinese State AIC settled 29,034 cases of selling fake goods by applying Chinese Anti-Unfair Competition Law in 1997. Article 5 of Chinese Anti-Unfair Competition Law stipulates that passing off or counterfeit act is an unfair competition act that should be enjoined. An operator may not adopt the following unfair means to carry to transactions in the market and cause damage to competitors: (1) passing off the registered trademark of another person;
Meanwhile, under Chinese Trademark Law and Chinese Anti-Unfair Competition Law, ?the infringed party may claim to the AIC at or above the county level for actions? to seek remedies such as confiscating the infringement products, issuing preliminary injunction, rewarding damages. The AIC concerned shall ?have the right to order the infringer to stop the infringing act immediately and to compensate the party whose rights was infringed for the damages suffered. If the circumstances are serious, the AIC may, in addition, impose a fine?.

ii. Product Quality Law
Article 5 of Product Quality Law prohibits ??to forge the original geography of a product, to forge or falsely use the name or address of another producer; to mix impurities or imitations into products that are produced or sold, or pass a fake product off as a genuine one, or pass a defective product off as a high-quality one.? Such prohibition is occurred in other articles many times in this law.
Under this law, county or higher level TSB has enforcement right as follows:
(1) Inspect and check the site where the act of manufacturing or selling products is suspected violation the law;
(2) Investigate and ask the representative and other relevant people about the act of manufacturing or selling that is suspected violation the law;
(3) Check and copy the relevant contracts, invoices, accounting book and other materials;
(4) Seizer and confiscate the materials, packages, and equipment for manufacturing or selling the products.
Directly under the State Council, TSB is an organization that supervise the quality of products and enforce the law. One of its main functions is managing supervision of the quality of products; managing and indicating of supervision and inspection of the quality of products; managing arbitration, check and verification of the quality of products; organizing and coordinating the raid action against manufacturing or selling the counterfeit or inferior products.(State Technical Supervision Bureau Organization)
Huge amount of counterfeit products with inferior quality and false indication of the name and address were confiscated by TSBs through county level to State level in the past several years.

iii. Regulations of the People?s Republic of China Regarding Customs Protection of Intellectual Property
On July 5, 1995, there was an exciting news on protection of intellectual property that was the Chinese State Council promulgating the Regulations of the People?s Republic China Regarding Customs Protection of Intellectual property (hereafter Regulations). The General Administration of Customs has set up in its headoffice a Section of Customs Protection for Intellectual Property Rights specially responsible for registering intellectual property rights in Customs and lending guidance to the Customs nationwide in taking protective measures.
The Regulations stipulates that goods infringing intellectual property rights under the protection of the laws and administrative regulations of the PRC are prohibited from import and export. The Regulations entitled that ?the Customs, when carrying out the protection of intellectual property related to inward and outward goods, may exercise the relevant powers defined in the Chinese Customs Law. These powers mainly include the right to check, the right to examine, the right to detain, the right to investigate, the right to punish and the right to dispose of the infringing goods?.
The Regulations and Chinese Customs Law became the legal basis on which the Customs carry out border protection of intellectual property. In past several years, Customs played an effect and important role in enjoining the counterfeit products importing or exporting. From 1996 to 1999, the Customs had handled counterfeit products cases in total 447 and valued to RMB124,830,000.

iv. Chinese Criminal Law
In 1997, China revised its Criminal Law and the new Criminal Law entered into force on October 1, 1997. There a section including eleven articles named ?Crimes of Producing and Marketing Fake or Substandard Commodities? in the new version of Criminal Law. Under this section, if the act of counterfeiting is serious, the counterfeiters would be sentenced to fixed-term imprisonment from 2 years to life imprisonment even to death.
After new Criminal Law promulgating, Public Security Bureaus are more deeply involved in handling anti-counterfeiting cases. Lin Rongqin, a small commodity wholesaler who has been doing business between Yiwu city, Zhejiang province and Guangzhou for years, was the first person imprisoned for selling counterfeit products and would spend 2 ? years behind bars.

III. Problems in Anti-Counterfeiting

China is to be commended for its substantial progress in enacting intellectual property laws and for the long-standing efforts by the AICs, TSBs, Customs, police and other government authorities to enforce intellectual property rights against counterfeiters. However, ?despite recent improvements, current enforcement efforts still generally fail to deter counterfeiters from continuing their illegal activity.? I believe that enforcement can be made effective if certain problem areas in the law and in policy are promptly addressed as discussed below.

i. Local Protectionism
The major problem for Anti-counterfeiting in China is not with the laws, but with enforcement. Enforcement is difficult in the provinces because of ignorance, lack of manpower, local protectionism. Growing local protectionism is threatening the Chinese economic reform.
Despite the many efforts of the central government, local protectionism continues to exist in many areas of China, posing significant barriers to enforcement against counterfeiting. Local officials are often unaware of the serious counterfeiting, are sometimes themselves corrupt, or may simply want to protect local entrepreneurs. The central government appears to have limited power to control local protectionism because under present political structures, local government generally control appointments, dismissals, job transfers, salaries, housing and other benefits for local AICs, TSBs, PSBs, judges, and other government officials. Such political structure is justified under the principle of dual leadership; local Party leaders are authorized to provide leadership over legal and political affairs, including the realm of law.
Since a number of those enterprises making counterfeit products are also mainstays in the development of the local economy, and some are even looked upon by the local governments as ?ace? or ?apple of the eye?? the counterfeiting manufacturer is often an important source of revenue for a certain locality, thus the local governments naturally become the umbrella or shield of the infringing enterprises. Some of the local government departments pull strings and seek help from powerful personages and go about drumming up support for the infringing enterprises. The AIC, when investigating and dealing with infringement cases, have met with considerable resistance from local government departments so that a number of persons directly responsible for the acts of infringement committed by enterprises have long remained at large.
Local officials frequently come under great pressure to safeguard local economic interests and some have been known to form alliances with local counterfeiters. In some cases, local AICs and TSBs may delay enforcement actions after a complaint is filed. By the time law enforcement officials finally arrive at the suspect premises, the counterfeiter, offending goods, machinery, and equipment have all disappeared. Some companies have reported that within the first half hour of lodging a complaint with local officials, the alleged counterfeiters can be seen moving product out of factories or warehouses. Local officials have also been known to confiscate goods machinery, and equipment only to return these materials to counterfeiters once enforcement actions have been concluded. Moreover, since local enforcement officials have broad discretion in determining the amount of fines and penalties and are not constrained by any mandatory minimum limits, some local enforcement entities impose light fines.
China has stepped up punishment of counterfeiting by amending the Product Quality Law in July 2000. Taking effect on September 1, 2000, the amended law stipulates practical measures against local authorities who provide shelters for counterfeiting.

ii. Problems of Enforcing the Law
Under the current system in the PRC, enforcement against counterfeits is pursued by a number of different government authorities pursuant to a number of different pieces of legislation. There are obvious benefits from the current administrative enforcement system in China, including the provision of multiple options in pursing infringements and access to a much higher number of enforcement officials than is the case in other counties. The trademarks owners have been impressed with the speed and reliability of the administrations in providing rapid seizures against counterfeits and infringing items over the last two decades. Indeed, however many problems were occurred during the administrative enforcement against the infringement. Here, I want to provide two instances about the problems in Customs bringing administrative enforcement actions under the Regulations of the People?s Republic of China Regarding Customs Protection of Intellectual Property and Chinese Customs Law.
The Article 14 of Regulations stipulates that ?The applicants shall, when they require the Customs to detain the suspected infringing goods, deposit a security with the Customs which is equal, in sum, to CIF value of the import goods or FOB value of the export goods.? This article impedes the trademark owners to actively secure their trademark rights through customs offices. The main barrier is ? deposit a security with the Customs which is equal, in sum, to CIF value of the import goods or FOB value of the export goods?.
This article makes petitioners worry about several things if they would request customs office to enjoin the infringing goods importing or exporting:
? Why does the customs office require the deposit?
? When can we get the deposit back?
? How much can we get back?
The applicants do not know when and how much they would get the ?deposit? back, even though in Article 25 of Regulations provides that ?Upon effect of the decisions made either by the Customs, or the competent authorities of the intellectual property rights or the judgment or ruling made by the People's Court, the Customs shall refund the securities which have been deposited by the parties concerned after following expenses have been deducted: (a) relevant expenses incurred in the storage, maintenance and disposal of the goods; (b) the compensation for the losses suffered by the parties concerned due to the improper application lodged by the right holders.?
This article does not answer the petitioners? concerned questions yet. Since it does not clearly explicit how long would the case be closed and how much does the relevant expenses cost, the petitioners would still not know the answer for the questions that they are more concerned.
Moreover, generally the trademark owners cannot provide such big amount deposit with customs office. If the infringing goods were found by several customs offices at the same time, it is almost impossible for trademark owner to make deposit to each customs office. I remember I talked with Mr. Philip Yang, Director of Corporate Affairs Dept. of Gillette (China), about the Article 14 of the Regulations. He said that it makes impossible for trademark owner to secure trademark rights with Customs. He told me a story that he had received an information that a big amount of counterfeit ?Duracell? batteries would have been exporting from Guangxi province. Thus, he had requested the customs office to confiscate those counterfeit products. The officials had told him that under the Article 14 of Regulations Gillette company should deposit US$300,000 with customs office. They did not tell him how long and how much the deposit would refund. Therefore, he had to give up endeavor.
There is another practical problem in Customs administrative enforcement actions. The Customs does not in a position to decide whether or not the alleged goods infringe the trademark rights. When the opponent denies the goods infringing the trademark rights, the petitioner has burden of proof of infringement. The Customs requests the petitioner to provide the document, issued by the Chinese Trademark Office, saying that the goods is infringement. However, Chinese Trademark Office does not issue such document to individual or other entities but only to government authorities. The Customs and Chinese Trademark Office do not establish any connection. Thus, in the Customs, if the opponent denies infringement and the petitioner does not have any document to verify the infringement, the case would be dismissed.

iii. Blank of the Law
under current Chinese intellectual property protection system, there are many laws applied to anti-counterfeiting. However, none of the law provides that contributory infringement is illegal.
According to the provisions of the laws, trademark infringing acts shall be divided into the four classes below. The first is to use, without the authorization of the owner of a registered trademark, a mark identical or similar to his registered trademark in respect of the same or similar goods; the second is to sell goods fully knowing that they bear a passed-off registered trademark; the third is to counterfeit, or to manufacture without authorization, representations of the registered trademark of another person or to sell such trademark representations; the fourth is to cause other damages to the exclusive right of others to use a registered trademark.
Under the current law, the window opens to contributory infringement. In China, many counterfeiters have anti-investigation experience and many of them found this window to escape punishment. When they produce counterfeit products, manufacturers do not put any mark on the products. Generally they have separate warehouses, long distance from the factories, or they cooperated with wholesalers. Manufacturers distribute the products to the warehouses or wholesalers without brand name, and in the warehouses or wholesalers? warehouses, the counterfeiting marks are attached to the products. It is clearly that when manufacturers distributed their non-brand products to the warehouses or wholesalers, they definitely have knowledge that somebody or wholesalers would put the passing off marks on the products. The manufacturers? action constitutes contributory infringement. However, since there is no contributory infringement definition in current Chinese laws, under such circumstance, the manufacturers would avoid being claimed infringement or any violation of the laws and they could not be imposed any punishment. Therefore, they can continually manufacture non-brand products and distribute to other wholesalers making counterfeit goods.

IV. Suggested Measures to Address Counterfeiting in China
To address counterfeiting in China, anti-counterfeiting measures should be as powerful as the anti-smuggling measures that the government introduced in 1999. Current Chinese laws need to be applied with greater diligence and additional improvements to China?s laws and training of enforcement personnel are essential. Administrative sanctions need to be increased and the threshold to initiate criminal investigation needs to be lowered.
To facilitate current enforcement efforts and to strengthen the current enforcement system, the following measures are considerable:
1. Interpret clearly the legal terms under the Trademark Law Implementing Rules, and mandate imposition of the term of imprisonment and minimum fines against counterfeiters;
2. Recover the trademark owners enough compensations based on actual damages suffered, including investigation and legal expenses;
3. Increase controls on domestic markets and export of counterfeit products so that cut the distribution channels for counterfeit products;
4. Enforce laws against government corruption and protectionism at all levels.
The panel of foreign firms hopes the new attitude will result in an anti-counterfeiting law, the clarification of standards for criminal liability under the criminal code and revisions to the product quality law.
They want government to set up a central enforcement agency and data base to help bring legal action against repeat offenders.

V. Conclusion
China is not the only country with counterfeits, but it is no doubt one of the regions most severely afflicted with the production and marketing of counterfeit goods. The counterfeiting problem in China is complex. Major reasons for the manufacturing and selling of counterfeit products include the drive for huge profits, lax law enforcement in some localities, excessively light punishment and a lack of awareness of the law.
Laws must not only be passed, but also enforced. "The laws are there, but the problem is so large they just cannot be enforced. Mainland laws needed to be applied with greater diligence and criminal penalties increased if the government is to stem the growing tide of bogus products after it joins the WTO. "
Everybody clearly understands there is a long way to go. The complexity and significance of counterfeiting requires a comprehensive reform of relevant laws, intensified was against local protectionism, and consistent dedication from government leaders at all level.
Chinese governments have recognized that as the manufacturing and selling of counterfeit products adversely affect the national economy, more rigorous measures must be taken to deal with counterfeit product manufactures and dealers. More stringent enforcement of anti-counterfeiting laws will be required after China enters the WTO.