Fordham Intellectual Property, Media and Entertainment Law Journal Volume 9 Volume IX Number 1 Volume IX Book 1 Article 3 1998 From Pirate King to Jungle King: Transformation of Taiwan's Intellectual Property Protection Andy Y. Sun Asia Pacific Legal Institute of ashingtW on, D.C. Follow this and additional works at: https://ir.lawnet.fordham.edu/iplj Part of the Entertainment, Arts, and Sports Law Commons, and the Intellectual Property Law Commons Recommended Citation Andy Y. Sun, From Pirate King to Jungle King: Transformation of Taiwan's Intellectual Property Protection, 9 Fordham Intell. Prop. Media & Ent. L.J. 67 (1998). Available at: https://ir.lawnet.fordham.edu/iplj/vol9/iss1/3 This Article is brought to you for free and open access by FLASH: The Fordham Law Archive of Scholarship and History. It has been accepted for inclusion in Fordham Intellectual Property, Media and Entertainment Law Journal by an authorized editor of FLASH: The Fordham Law Archive of Scholarship and History. For more information, please contact [email protected]. From Pirate King to Jungle King: Transformation of Taiwan's Intellectual Property Protection Cover Page Footnote "The author especially wishes to thank Edward C. Werner for his assistance." This article is available in Fordham Intellectual Property, Media and Entertainment Law Journal: https://ir.lawnet.fordham.edu/iplj/vol9/iss1/3 ARTICLES From Pirate King to Jungle King: Transformation of Taiwan's Intellectual Property Protection* Andy Y. Sun** TABLE OF CONTENTS INTRODUCTION ........................................................................... 70 I. TAIWAN'S REFORM PATH ................................................. 73 A. External Factors: BilateralInteractions with the United States and Other States.................................. 73 B. Internal Factors: Self-awareness, Self-image and Self-interests ............................................................. 76 C. InternationalFactors: The WIP, WTO and APEC ...... 78 II. OVERVIEW OF TAIWAN'S INTELLECTUAL PROPERTY PROTECTION ..................................................... 83 A . Patent Law ............................................................... 83 * This article is based on and expanded from a presentation at the Intellectual Property: Japan and the New Asia conference on October 22, 1997 in Washington, D.C., sponsored by the Japan Information Access Project. The author especially wishes to thank Edward C. Werner for his assistance. Unless stated otherwise, all Chinese charac- ters are spelled out in accordance with the Wade-Giles system and all citations to the Chinese/Taiwanese law is referred to as "Article" followed by its officially designated statutory number. The original Chinese text for most of the Taiwan laws and their im- plementing regulations may be found in any of the commercially available Liu FA CH'CAN SHU [COMPREHENSIVE BOOK OF SIx CODES]. ** LL.B., National Chengchi University, Taipei, Taiwan; M.C.L., The George Washington University Law School (formerly National Law Center), Washington, D.C.; and, J.D., University of Maryland School of Law, Baltimore, MD. The author is the Ex- ecutive Director of Asia Pacific Legal Institute of Washington, D.C., a non-profit organi- zation for the promotion of international comparative studies, education exchange and cooperation on intellectual property and trade. Between 1994 and 1998, he was Associ- ate Director of the Dean Dinwoodey Center for Intellectual Property Studies, The George Washington University Law School. FORDHAM INTELL. PROP. MEDIA & ENT. LJ. [Vol.9:67 1. Patentable Subject Matter ................................. 84 2. Term of Protection ............................................. 85 3. Scope of Rights .................................................. 86 4. Exhaustion Doctrine ........................................... 87 5. Compulsory Licensing ...................................... 88 6. Presumption of Infringement on a Process Patent .................................................... 90 7. Marking and Notices .......................................... 90 8. Priority of Foreign Patent .................................. 91 9. Remedies/Criminal Penalty for Patent Infringers ........................................................... 92 10. Disposition of Infringing Products ..................... 93 11. Pipeline Protection ............................................. 93 12. Pending Reforms ................................................ 96 B. Trademark Law ........................................................ 96 1. Protectable Subject Matter/Categorization and U se .............................................................. 97 2. Term of Protection ............................................. 98 3. Well-known Mark Protection ............................ 98 4. Exhaustion Doctrine/Parallel Imports ................ 99 5. Fair Use Exception to Exclusive Rights .............. 101 6. Priority of Foreign Trademark ............................. 101 7. Disposition of Counterfeit Products ..................... 102 C . FairTrade Law ........................................................... 102 D . Copyright Law ............................................................. 105 1. Acquirement of Copyright .................................. 106 2. Scope of Rights .................................................... 107 3. Protectable Subject Matter ................................... 108 4. Term of Protection ............................................... 109 5. Reverse Engineering ............................................ 109 6. Compulsory Licensing ......................................... 110 7. Restoration of Copyright ...................................... 111 8. F air U se ................................................................ 112 9. First Sale Doctrine/Exhaustion ............................ 113 10. Export Licensing/Inspection System ................... 114 11. R em edies .............................................................. 116 12. The 1997 Copyright Amendment ........................ 118 a. Definitions and Scope of Protection ........... 118 b. Neighboring Right ...................................... 120 1998] TRANSFORMATION OF TAIWAN'S IP PROTECTION 69 c. No Formality Rule ...................................... 122 d. Border Enforcement .................................... 124 e. F air U se ....................................................... 125 f. Compulsory Licensing ................................ 126 g. Statute of Limitation ................................... 126 h. First Sale Doctrine/Parallel Imports ............ 127 i. Retroactive Copyright ................................. 128 j. Specialized Court ........................................ 128 k. Pending Issues and Legislation ................... 129 E. Trade Secrets Law ....................................................... 132 F. Integrated Circuit Layout ProtectionLaw .................. 134 G. Plant Seeding Law ....................................................... 139 H. IndustrialDesign Protection....................................... 140 I. GeographicIndication ................................................ 140 J. Reforms under the 1996 Action Plan .......................... 141 1. Committing Regional Enforcement ..................... 143 2. Preventing CD Piracy-SID and Self-regulation ........................ 145 3. Enhancing General Enforcement ......................... 147 4. Streamlining and Expediting the EMS ................ 149 K. The 1998 Action Plan .................................................. 154 Ill. FUTURE CHALLENGES FOR TAiwAN .................................... 155 A. OrganizationalIntegration and Coordination............ 156 B. Court Proceedings,...................................................... 159 C. InternationalInteractions ........................................... 163 C ONCLU SION ................................................................................. 167 A PPEN DIX ..................................................................................... 170 FORDHAM INTELL PROP.MEDIA & ENT. L.J. [Vol.9:67 INTRODUCTION Throughout the past two decades, the Republic of China ("Taiwan") has been notoriously dubbed by many, particularly American industry, as the "pirate kingdom" of the counterfeit world.' According to one estimate, the copyright holders in the United States alone suffered US $669 million losses from Tai- wan's pirate counterfeiting activities in 1992.2 Ever since the en- actment of the "Special 301" provision under American trade laws, Taiwan has been a constant on the law's "hit list".3 This dubious recognition means Taiwan was either identified as a "priority for- eign country," a trade partner that "has committed the most oner- ous or egregious acts, policies or practices" in denying "adequate and effective protection of intellectual property rights" ("IPRs"), or "fair and equitable market access to United States persons that rely upon intellectual property protection" or being placed on the "Pri- ority Watch" list pending further investigations and consultations.4 1. See USTR, FACT SHEET ON AIT-CCNAA UNDERSTANDING REGARDING INTELLECTUAL PROPERTY PROTECTION IN TAIWAN (June 5, 1992). 2. This is an estimate by the International Intellectual Property Alliance ("IIPA") in its 1993 annual submission to the Office of the United States Trade Representative ("USTR") and was adopted by the latter without change. See IIPA, SPECIAL 301 RECOMMENDATIONS (1993) [hereinafter 1993