Business Software Alliance Investigation

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					VOL. 15       NO. 6       JUN. 16, 2007 

  ENFORCEMENT                                                 Hongti Sung, co-chair of BSA Taiwan, stated that the
                                                              two percent point decline last year represented the
Taiwan’s Software Piracy Rate Dropped
For The First Time In Five Years                              collaboration of government enforcement and the
                                                              private sector’s anti-piracy campaign effort.      910
On   May 15, 2006, the Business Software Alliance             cases had been reported during the campaign. The

(BSA) announced the findings from the 2006 global             total amount of infringement on internal use of pirated

software piracy study, conducted by International             software within enterprise exceeded 500 million NT

Data Corporation, that Taiwan’s piracy rate dropped           dollars.

2% to 41% last year, the first drop of piracy rate in
five years.   Taiwan’s piracy rate is ranked No. 3,           This campaign continues in 2007 from May 1 to June
after Japan (25%) and Singapore (39%) in the Asia             15.   BSA increased the reward to a maximum of 3

Pacific region (excluding New Zealand and Australia),         million NT dollars and co-worked with the judicial

and No. 23 worldwide.                                         unit on the investigation, hoping to decrease Taiwan’s
                                                              piracy rate to below 40% under the co-operation
The BSA analyzed that Taiwan’s piracy rate drop in            between the government and the private sector.

2006 is related to the collaboration of government
enforcement and the private sector’s anti-piracy              With respect to global software piracy rate, the global
campaign effort.      Although the drop of Taiwan’s           software piracy rate remained at 35% in 2006;

piracy rate closes the gap to the global average piracy       however, because the popularity of the Internet and

rate of 35%, it is hoped that the piracy rate in 2007         broadband as well as the influence of peer-to-peer

can drop to 40%, which is set as the short-term goal          (P2P) network transmission increased the supplies of

by the Ministry of Economic Affairs. Additionally,            pirated software, access to pirated software become

due to the growth of software market in 2006, the 2%          more available.     Additionally, new users in the

drop in Taiwan’s piracy rate results in an overall            emerging markets are mainly consumers and small

economic loss from 110 million U.S. dollars to 180            enterprises, and thus worsen the piracy problem.   An

million U.S. dollars.                                         overall economic loss increases by 5.1 billion US
                                                              dollars approaching 40 billion US dollars at 39.5
                                                              billion US dollars, a 15 % increase from 2005.

Although the piracy rate decreases in 11 countries in         ranked No. 1 in the number of patent grants obtained
the Asia Pacific region, the overall piracy rate in the       by foreign companies, with a total of 493 patent
Asia Pacific region increases.      BSA indicated that        grants.
due to the rapid increase in the Chinese and Indian
markets, the market shares thereof in the overall Asia        The   Intellectual Property Office indicated that the

market increase.     Even though the piracy rate in           number      of   patent   applications      accepted   for
China (82%) and India (71%) decreased last year, the          examination in 2006 was 80,989, only an increase of
average amount in the region still increases, thereby         1,547 applications compared to the number in 2005.
increasing the Asian economic loss from 8.05 billion          The   top three domestic companies ranked in the

US dollars to 11.59 billion US dollars, equivalent to         number of applications filed have not changed when
approximately 394 billion NT dollars.                         compared with those of 2005.             These top three
                                                              companies were Hon Hai Precision Industry Company
IDC estimated that enterprises and consumers would            Ltd., the Industrial Technology Research Institute
spend 350 billion US dollars on PC software in the            (ITRI), and Inventec, ranked No. 1, 2 and 3,
next 4 years worldwide. During this period, there             respectively, with 1830 applications, 873 applications
will be more than 180 billion US dollars worth of PC          and 819 applications filed, respectively.
software piracy.     The education on anti-software
piracy should continue, and help is needed from the           In terms of the number of patent grants obtained, the
global citizens to combat piracy.                             top three companies were the same as those in the
                                                              number of applications filed; in other words, Hon Hai,
                                                              ITRI, and Inventec were ranked No. 1, 2, 3 with 898
  ENFORCEMENT                                                 patents, 583 patents and 493 patents granted,
Hon Hai Remains No. 1 In The Rankings
Of The Number of Patent Applications
Filed And The Number Of Patent Grants                         The top three foreign companies in the ranking of the
Obtained In 2006
                                                              number of applications filed remained the same when
                                                              compared with that of last year. Specifically, Royal
Based   on the 2006 statistic report on patent
                                                              Philips filed 850 applications; Samsung filed 747
applications and patent grants published by the
                                                              applications; and Sony filed 493 applications.         In
Intellectual Property Office of the Ministry of
                                                              terms of the number of patents granted, Sony obtained
Economic Affairs, Hon Hai Precision Industry
                                                              401 patents; Intel obtained 364 patents; and Epson
Company Ltd. once again ranked No. 1 in terms of the
                                                              obtained 355 patents.
number of patent applications filed as well as the
number of patent grants obtained. Since 2003, Hon
                                                              P lease    refer to the following link for related
Hai has continuously remained at No. 1 in these two
                                                              information in Chinese:
rankings. Royal Philips was ranked No. 1 for the
fifth time in the number of applications filed by
foreign companies.    On the other hand, Sony was

                                                               service center for patents, an expedited service is
 MEASURES                                                      provided to “file in the morning and receive in the
                                                               afternoon”.        Furthermore,     the    examination
Convenient Measures Of The Intellectual                        procedures for patent and trademark applications are
Property Office Greatly Appreciated By
The Industries                                                 simplified and unified such that the time to handle
                                                               registrations on for example patent rights assignment
Based     on the statistics obtained by the Intellectual       is shortened from 30 days in 2005 to 14 days. The
Property Office of the Ministry of Economic Affairs,           time to handle changes to patent rights information is
the number of office communications sent and                   also shortened from 25 days to 7 days.
received with reference to patents, trademarks and
general applications reached 1.582 millions, an                In   terms of electronic services, notifications on

increase of 73000 office communications from 2005.             annual fees, expiration of patent rights and extension
In order to simplify the operating procedures as well          prior to the expiration of trademark rights have
as to improve the administrative efficiency, the               already been done by emails.      Electronic papers and
Intellectual Property Office has proactively followed          daily updates have also been circulated in both
enterprise operations to provide a variety of                  Chinese and English.
convenient measures, such as increasing the services
provided at the service locations, setting up counters         In   order to continue shortening the operating

for expedited service, simplifying the operating               procedures and increasing localized and electronic
procedures and increasing electronic and paperless             services, the Intellectual Property Office stressed to
communications.                                                introduce the launch of a small scaled online filing
                                                               system such that people may complete the filing
In   terms of providing localized services, the                through the Internet to achieve the ultimate goal of
Intellectual Property Office established a Tainan              “more Internet, less road”.
branch in the Tainan City Government Building in
October, 2006. This is the fourth branch established
after the Kaohsiung branch, the Taichung branch, and             LAWS & REGULATIONS
the Hsinchu Branc, providing services to the people in
                                                               European Commission Officials Arrived
the Southwest coast area.                                      Taiwan To Investigate The Compulsory
A “same-day filing and same-day receiving” scheme              Licensing of CD-R Granted By The TIPO
is adopted by the services provided in the service
locations in each region; additionally, an interview
                                                               Recently, the compulsory licensing issues in Taiwan,
system is established at the service locations in each         whether it be the Draft Amendment to Article 76 of

region.                                                        the Patent Act that is being examined in the
                                                               Legislative Yuan or the appeal concerning the

In   terms of simplifying procedures, in order to              compulsory license granted by the Taiwan Intellectual

strengthen the services provided at the expedited              Property Office filed to the European Commission by

the Dutch company, Royal Philips, requesting to                same principle in addition to Philips.
resolve such issue through WTO dispute settlement
mechanism, have been widely discussed.                         If it is determined that the proceedings to handle the
                                                               compulsory     licensing    grant   of   the    Taiwanese
On   March 1, 2007, the European Commission                    government      are    inappropriate,    the     European
officially notified us that the EC has accepted to             Commission will then determine whether to proceed
conduct a review on the complaint filed by the Dutch           with the consultation with the Taiwanese government
Company, Royal Philips, with regards to the                    to find a resolution. If the Taiwanese government
compulsory licensing of CD-R granted by the TIPO in            does not accept the opinion of the European
accordance with the procedural Trade Barrier                   Commission after such consultation, the WTO dispute
Regulation (EC) No. 3286/94 and started the                    resolution settlement will then follow to resolve the
trade-related investigation. At the initial stage of the       dispute between the two parties.          The European
investigation, the EC plans to clarify the facts accused       Commission official indicated that whether the
by Philips and send officials to Taiwan to investigate         proceedings pertaining to the compulsory licensing
on such facts and conduct discussions with the                 grant handled by the Taiwanese government satisfy
Taiwanese Authority.                                           the requirements of TRIPS may be decided through
                                                               the WTO dispute resolution settlement.         The winning
In May of the same year, European Commission sent              party may ask for compensation, which is usually
officials to Taiwan to investigate on the facts and            trade sanctions, such as an increase in tariffs, etc.
conduct discussions with the Taiwanese Authority.
After four days of investigation, the full investigation       The Intellectual Property Office indicated that Philips’
report is expected in August of this year. During the          accusation may be a result of a difference in the
interview with the Economic Daily News, the                    understanding of the international standards, or a
European Commission official indicated that the                misunderstanding of the examination proceedings,
European Commission is interested in the principle of          facts, and the legal effect of the decision. Therefore,
granting a compulsory licensing by our government,             the Intellectual Property Office has proactively
and whether such principle is in violation of TRIPS            provided     supporting      document       during      the
set by the WTO. The European Commission is also                investigation proceedings conducted by the European
interested in knowing whether the interests of other           Commission to clarify the issues and resolve disputes.
European companies may be jeopardized under the

                                         TAIWAN IPR NEWS
PUBLISHER/PRESTON W. CHEN                                       PUBLISHING AGENCY/
TRANSLATOR/SUZY SHOUNG                                                    TAIPEI, TAIWAN, R.O.C.
                                                                TEL/886-2-27033500      FAX/886-2-27042477


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