Protection for Computer Software in China

September 19, 2003
Protection for Computer Software in China

Kan Zu

I. Introduction to Chinese Intellectual Property and Status of Computer Software
1. Protection of Intellectual Property in China
(1) The Relationship Between International Law and Chinese Municipal Law
(2) The Development of Chinese Intellectual Property Protection
2. Status of Computer Software
(1) Chinese Software Industry
(2) The Social Background of Chinese Computer Software protection
3. The Legal Complexity of Computer Software
(1) Domestic Laws
(2) International Treaties
(3) Enforcement Systems

II. Copyright Protection for Computer Software
1. Copyrightbility of Computer Software
2. Concept
3. Registration and Advantage of Registration
4. Registration Procedure
5. Enfocement
(1) Judicial method
(2) Administrative method
II. Others Protection for Computer Software in China
1. Patent Protection
2. Customs Protection
IV. Conclusion

Protection for Computer Software in China
Kan Zu*
I. Introduction to Chinese Intellectual Property and Status of Computer Software
1. Protection of Intellectual Property in China
The execution of the ‘open to the outside world policy’ from December 1978 resulted in not only an increase of foreign trade, but also the new development of a commodity economy within China. Under the guidance of the State reform and open policy, the Chinese Government will make every effort to internationalism and modernism the legislation of intellectual property rights in a practical manner so as to quicken the progress of the construction of the State economy.

(1) The Relationship Between International Law and Chinese Municipal Law
China has acceded to several international conventions, treaties and protocols, but not all of its domestic laws have met the minimum requirements of the corresponding international legal instruments. These discrepancies, however, would not be obstacles for China in assuming its international obligations. According to the General Principles of the Civil Law, if any international treaty concluded or acceded to by China contains provisions differing from those in the civil laws of China, the provisions of international treaty shall apply, unless the provisions are those on which China has made reservation. Therefore, the provisions of a treaty become part of Chinese municipal law automatically as soon as China accedes to the treaty. In other words, under the Chinese legal system it is not necessary to transform the stipulations of a treaty into municipal law through legislation, as required by the legal systems of some other countries.
The promulgation of Chinese Copyright Law in 1990 and China’s participation in the Berne Convention in 1992 have freed foreigners from doubts on the protection of their works. “works of foreign nationals, if published first within China, shall be protected by this law and enjoy copyright in accordance with the agreement signed by their countries and China, or the international treaties they have co-signed.”

(2) The Development of Chinese Intellectual Property Protection
During the past decade, significant steps forward have been taken in intellectual property protection in China, and this progress is well recognized worldwide.
Since the 1990s, China has taken part in all the meetings with respect to the negotiations of the TRIPS. Furthermore, China activity participated in the WIPO expert and diplomatic meetings for the establishment and revision of conventions, treaties, agreements and protocols on intellectual property, especially negotiations about the TRIPS Agreement since the end of 1991. As a result, a unanimous agreement has been reached among intellectual property circles in China to put a high emphasis on the protection of intellectual property.
After 1990, the Copyright Law was issued and the trademark and patent law were revised. In addition, the Anti-Unfair Competition Law, the Regulation of Customs Concerning the Protection of Intellectual Property, and the Regulations Concerning the Protection of the Plant Varieties were also passed and implemented. They were formulated with reference to the TRIPS Agreement, as well as multilateral and bilateral agreements with other countries.

2. Status of Computer Software
(1) Chinese Software Industry
The software industry has also been a vigorous element in the Chinese economy since the 1980s. After 20 years of development, the Chinese software industry has grown by more the 50%. In 1995, the software market was worth RMB6.8 billion, in 1996 RMB9.2 billion, and by 1997 nearly RMB12.6 billion.
Chinese software takes only 30 per cent of the domestic market, the rest of which is occupied by foreign software products. In the fields of financial software, virus-clearing software and Chinese character input software, Chinese software enterprises have limited advantages.
For example, as the Chinese language is very different from alphabetic languages, western word processing software cannot be used in the Chinese market without proper Chinese character processing programs. Many Chinese software developing companies depended on the Chinese word processing software market, and due to their cultural and language advantages, were ahead of their western competitors for a time. However, this situation changed rapidly, as Microsoft created ever more refined Chinese versions of word processing programs to meet the needs of Chinese users, gradually driving Chinese software companies out of the market.
There are 5,000 software companies in China, of which 2,000 companies are engaged in software development, research and marketing, and 3,000 companies are selling software and providing other information services. Most software companies are very small enterprises, in which technicians’ number less than 50. In contrast to other Chinese industries, private enterprises occupy a large part of the software industry. They are much flexible than the large enterprises, but their power and influence are limited, and they cannot become the backbone of the Chinese software industry.
The software industry has been a bottleneck in the Chinese information industry, which may be harmful to China’s economic development and competitive power in world trade. However, China is confident of the future of the software industry.

(2) The Social Background of Chinese Computer Software protection
Visitors to Beijing may have seen the ‘Chinese Silicon Valley’ in the Zhongguancun. There large computer companies exist alongside small software shops; in the shadow of huge advertisements for all kinds of world famous computer brands individuals are clandestinely selling pirated software and CD-ROMs.
Although 99 per cent of the software used in China is pirated has been firmly denied by Chinese government, it is undeniable that piracy is a very serious problem in China. In a market survey conducted by China Computer World, 63 per cent of CD-ROMs used by users with college degrees were pirated, though the piracy rate was lower for users from other educational backgrounds.
Chinese software protection is promoted by two sources of power, one from outside China, the other from inside. As a member of many important international intellectual property protection conventions, China is within the multilateral intellectual property regime, and these conventions greatly influence Chinese intellectual property legislation. Bilateral agreements also play a role in the evolutionary process of Chinese software protection. United States software companies occupy a large share of the Chinese market, so the U.S. government has been very concerned about Chinese software protection. In several rounds of the Sino-American Intellectual Property Negotiations, software protection was among the most important topics.
Under the Agreement concluded in 1995 between the U.S. and Chinese governments, Chinese authorities have taken strong action to enforce intellectual property rights. Since 1995, many plants producing infringing products have been closed, or have had their business licenses revoked, and more than two million infringing CDs, LDs and copies of computer software have been sized and destroyed. Factories that have engaged in infringing activities have been punished through seizure and forfeiture of infringing product and all infringing copies have been destroyed and the materials and implements directly and predominantly used to make the infringing products have been sized, forfeited and destroyed. Exports of infringing products have been banned. The establishment of a copyright verification system and the use of unique identifiers on CDs, CD-ROMs and LDs have provided a vital tool to prevent the production of infringing goods and export of those goods. Permits to engage in activities related to audio-visual products will not be issued without copyright verification and imprint of the unique identifier. More than one violation of this condition will result in revocation of the permit and serious repeat offenders will have their business licenses revoked. The Chinese government has required that public entities shall not use unauthorized copies of computer software in their computer systems, and that adequate resources shall be provided to permit the acquisition of only authorized computer software.
With the development of the Chinese software industry intellectual property protection has become an inevitable demand of software enterprises. Software and network service corporations are considering intellectual property as a powerful weapon to strengthen their competitiveness and increase their market share.
There is still a long way to go for Chinese software protection. China needs not only to develop a more comprehensive legal system and more effective enforcement mechanisms, but also to enhance public awareness of the problems caused by software piracy.

3. The Legal Complexity of Computer Software
(1) Domestic Laws
In China, the copyright, patent, and unfair competition laws are the most important sources of law for the protection of computer software.
Computer software is protected subject matter under the Copyright Law of 1990. In 1991, the Chinese State Council promulgated the Regulations on Computer Software Protection (Software Regulations), which provides more detailed rules for copyright protection of software.
With respect to Chinese patent law, it is possible for software to be granted patent rights when integrated with hardware, but it is impossible for software per se, separate from hardware, to acquire patent protection.
The trade secret protection under the Chinese Anti-Unfair Competition Law of 1993 has also been important with regard to software. Software engineers are critical for software development, and often learn the know-how of a enterprise. Once these engineers transfer from that company to another, the former company faces the danger of its know-how or other business secrets being leaked. The Chinese government urges Chinese software companies to protect their trade secrets by means of employment contracts and other legal measures.

(2) International Treaties
Multinational and bilateral agreements also play an important role in Chinese software protection. China has shown great interest in the TRIPs Agreement of WTO and China made reference to the TRIPs Agreement when modifying its Copyright Law and other intellectual property laws in order to reduce the distance between China and the WTO.
In 1979, the first Sino-American trade agreement marked the initiation of Chinese intellectual property protection. From then on, Sino-American bilateral agreements have been exerting significant effects on Chinese intellectual property protection. In 1992, the United States and Chinese governments signed the Memorandum of Understanding on the protection of intellectual property. In 1995, the two governments signed another agreement, the Action Plan for Effective Protection and Enforcement of Intellectual Property Rights.

(3) Enforcement Systems
In recent year China has made considerable progress in enforcing intellectual property rights in respect of computer software protection through judicial and administrative procedures.
In accordance with the Action Plan for Effective Protection and Enforcement of Intellectual Property Rights of 1995, the State Council of China established a Working Conference on Intellectual Property Rights which centrally organizes and co-ordinates protection and enforcement of all intellectual property rights throughout the country, and will ensure that effective protection is provided and infringement of intellectual property rights is substantially reduced.
In 1998, the State Intellectual Property Office was established on the basis of the Patent Administrative Authority. The new Intellectual Property Office takes over the responsibility of the former Working Conference on Intellectual Property Rights under the State Council, organizing and coordinating protection and enforcement of intellectual property rights throughout the country.

III. Copyright Protection for Computer Software
Computer software in China was protected by sui generis law, but is not subsumed with literary works under copyright law. This development has occurred to conform with international trends.
It has been nearly ten years since China brought computer software under its copyright protection by Software Regulations. Since then, software copyright has undergone rapid development in China, maturing now into a somewhat self-contained field within China’s copyright regime.
The Chinese Copyright Law specifically includes computer software as part of the “works” which fall within its scope and further provides that measures for the protection of computer software are formulated separately by the State Council. The Chinese Copyright Law generally provides that works must be unique results of intellectual activity which directly produces written, artistic or scientific works, that can be reproduced in a tangible form. “Reproduction” is defined in the Implementing Regulations as “the means of production of one or more copies of a work by means of printing, photocopying, making a rubbing, making a sound recording, making a video recording, duplicating a recording, re-photographing and re-filming”.

1. Copyrightbility of Computer Software
The Copyright Law expressly specifies computer software as a copyrightable subject matter. However, it is not regarded as a part of ‘literary works’ but is protected as a special class of works outside the scope of traditional literary and artistic works. Instead the Chinese Copyright Law empowers the State Council to establish separate regulations for computer software protection. This is largely due to a unanimous view among some Chinese legal and technical experts that a special protection regime should be provided for software in addition to general copyright protection—such as a sui generis industrial copyright system which recognizes software as both an intellectual and industrial product. This view is to a certain extent incorporated in the Regulations on the Protection of Computer Software drawn up by the Chinese Ministry of Information Industry .
“Computer software” refers to computer programs and their related documentation. ‘Computer programs’ is “a coded instruction sequence” or “a symbolic instruction sequence or symbolic statement sequence which may be automatically converted into a coded instruction sequence” and includes both source code programs and object code programs. Moreover, the source code and object code of the same program are deemed to be the same work. “Documentation” covers diagrams and written material in any natural or formal language, such as program design specifications, flow charts and user manuals.
The combined effect of these provisions is that computer programs, whether in source codes or object codes, and their preparatory material attract copyright. This provision is much clearer and simpler than those of the model laws.

2. Concept
Software Regulations expressly preserves the idea—expression dichotomy in software copyright. The article establishes that the protection afforded to software under the Regulations does not extend to “any idea, concept, discovery, principle, algorithm, process and method of operation used in the development of the software” . However, it is not clear how the courts or administrative authorities will draw the boundary between idea and expression in a software work.
Software Regulations provides that any similarity between new software and existing software “due to the limited number of expressible forms available” will not constitute infringement of copyright in the existing software. Hence as far as software is concerned, there is a doctrine in China which is similar to the ‘merge doctrine’ established in Baker v. Selden in the United States.
The Software Regulations define “Reproduction” as “the copying of software onto a tangible medium” and contain provision covering the right of exploitation by the copyright owner and the right to license and to receive remuneration.

3. Registration and Advantages of Registration
“Registration of copyright in software with the administrative body for software registration shall be a pro-condition for filing a request for administrative disposition or, or for instigating legal proceedings for, an infringement of rights in software under these Regulations.
The registration certificate issued by the administrative authority for software registration shall constitute preliminary proof of the validity of copyright in the software, or the truth of the facts stated in the written application for registration.”
The authority in charge of software registration is National Copyright Administration (NCA) but the actual registration of copyright is software is carried out by the China Software Assessment and Registration Center (SARC). The SARC accepts and examines applications for software registration and extensions and also publishes and distributes the “Software Gazette”, in which queries from the public regarding software regulations, maintenance of the software register and other matters related to registration are addressed. The Software Registration Review Board handles the review of software registrations.
From the above provision it is plain that software registration in China, though not a pro-condition for subsistence of copyright in software, is a pre-condition for bringing an action for software copyright infringement. This clearly violates the “no formality principle” of the Berne Convention. A year after the Software Regulations were passed, the State Council promulgated the Implementing International Copyright Treaties Provisions (Treaties Provisions), which expressly state that foreign computer programs do not require registration to enjoy literary copyright in China. The net effect is that despite Article 24 of the Chinese Regulations on the Protection of Computer Software, registration is not a pre-condition for foreign software owners to file copyright infringement actions with the administrative authorities or the courts in China.
The Treaties Provisions provision that foreign computer programs are protected under the Chinese Copyright Law as literary works, removes the need for software from member countries of the Berne Convention to be registered. Software owners from non-member countries must register in order to gain protection. Applications from foreign software owners are generally handled in accordance with the relevant provisions of international treaties or bilateral agreements of which the applicant’s home country and China are members. There may be benefits for computer software owners to register voluntarily even if registration is not requirement for bringing action against the infringers.
Registration does, however, provide evidence of validity of ownership of copyright in the software and of the facts stated in the application for registration. In general, it is likely that judges and officials in China will favor registration by the SARC as evidence of ownership. Under certain circumstances, therefore, voluntary registration of software programs may be advisable for defensive and enforcement purposes.
Registration gives the software owner significant evidential advantages in case of dispute. While it is a basic principle of China’s civil procedure that the party who asserts bears the burden of proof, this burden can be reduced considerably if the software owner registers his software. Where the software is registered, the registration certificate shall constitute “preliminary proof of the validity of the copyright in the software, or the truth of the facts stated in the written application for registration”. These presumptions are important to the software owner taking legal action, for the onus is then shifted to the defendant to rebut them. Coupled with the presumption under the Copyright law that the person whose name is affixed on a work is presumed to be its author, the registration certificate held by then software owner will in practice present a formidable hurdle for the defendant to overcome.
To better appreciate the evidential advantages of software registration, one only needs to consider the opposite scenario where the software owner has failed to register the original software while the defendant has managed to register the infringing software. In such a case, it is the software owner, not the defendant, who has to rebut the attendant presumptions. This scenario is not uncommon in China and typically arises from double-registration of identical or similar software, or wrongful registration of infringing software. A case in point is Chaoxiang Technology Development (Beijing) v. Changcheng Business Promotion (Beijing).
Registration helps to refute the defense of “innocent infringement” available under the Software Regulations. Though not expressly stated in the Copyright Law, liability for copyright infringement in China is based on “fault”, a notion that covers situation where the infringing act is done “willfully”, “knowingly”, or “negligently”. If the copyright owner cannot establish such fault on the part of the infringer, the latter will not be held liable. As copyright infringement is a civil wrong, the fault principle applies.
In the area of software copyright, if a holder of software does not know, or has no reasonable grounds to know, that the software is infringement, liability for infringement shall be borne by the supplier of the infringing software. Thus, if the software owner cannot prove that the holder of infringing software has the requisite knowledge, the holder will be deemed as “innocent”, and liability will then be shifted to the supplier of the infringing software. The term “supplier of infringing software” is defined as “any person who supplies to others software that he clearly knows to be infringing”. Though this definition is inclusive, based on the fault principle and the language of the provision it is likely that an “innocent” supplier without the requisite knowledge may also escape liability.
Therefore, by registering his software and having the registration announced and recorded by the relevant authority, the software owner would have a strong ground to refute suggestions that the defendant—be it the holder or the supplier of infringing software—was “innocent”. As the registration has been announced and the registration record is accessible to the public, it would be more difficult for the defendant to convince the court that he did not know the software, or that he had no reasonable grounds to know that the copies of software he held or supplied were infringement.
In addition, the registration serves as proof of the time the software first appeared in the Chinese market. If in a subsequent litigation, the defendant claims that he was unaware of the software or that his work was the first in time, the software owner can easily rebut the claim by comparing the time his software was marketed in China with that of the infringing software. Furthermore, by establishing that his software was the first to appear in the Chinese market, the software owner can prove that the defendant is likely to have accessed his software before developing the infringing software. This element of access is often crucial in establishing copying.
The sealed source program deposited with the registration authority is authentic evidence in litigation. In disputes involving unauthorized copying of software, the software owner is often required to prove that the code allegedly copied by the defendant is indeed part of the registered software. The best and the most authentic evidence for the software owner in this regard is a sealed copy of his source program deposited with the registration authority. The software owner can apply to the registration authority to make such a deposit after his application for software registration is granted. If the deposit is approved, the registration authority shall seal up the source program, and no person will be allowed to remove the seal without consent of owner or an order of the court. When unsealed, the source program is an authentic copy of the software. It will then be just a comparison between the source program and the defendant’s program to verify that whether the latter has copied from the former.

4. Registration Procedure
To apply for registration the software owner should provide, among other things, the following documents:
a) A certificate of the owner’s identity;
b) The relevant authorization documents (if the software is a modification of another software);
c) The relevant assignment documents (if the owner is an assignee);
d) Other authentication materials which contain the distinguishing features of the software (typically, portions of the source code) and which can show that the software was developed independently and was human-readable.
If the software embodies business secrets or other confidential information, the software owner may apply for “exceptional deposit” whereby the confidential parts of the source program deposited with the SARC will be covered with wide black oblique lines. Generally, the SARC does not make any technical appraisal of the software nor investigate if it is infringing. So long as the software owner has submitted all the required documents, the SARC will normally approve the application for registration. The registration will then be recorded in a public register kept by the SARC and announced in a bulletin published by the latter, and a registration certificate will be issued to the software owner. Such public information will be of great evidential value to the software owner if a dispute later arise in relation to the registered software.

5. Enforcement
China’s “dual” enforcement system, which provides for both judicial and administrative channels for handling intellectual property infringement, is unique by world standard. This system clearly seems to be the most appropriate system for China, given the country’s special conditions and historical circumstances.
(1) Judicial method
Enforcement of copyright in software may be carried out by filing an action directly in a court and some courts have established specialized intellectual property tribunals. Litigation in a court is generally expensive and time-consuming and the court’s lack of experience in intellectual property matters has traditionally deterred people from using its as a channel of redress.
Until recently, an infringed party could only seek civil remedies against infringers. The Chinese Criminal Law has been amended however, by Standing Committee of the National People’s Congress on March 14, 1997, which introduced criminal penalties for intellectual property infringement. The reproduction, distribution and sale of counterfeit software is now subject to criminal sanctions which are expressly stated to be in addition to the civil liability of infringers.
The Criminal Law states that a convicted person may be imprisoned for a maximum of seven years as well as fined . The application of different terms of imprisonment is categorized according to vaguely worded definitions of cases involving, for example, “huge amounts” of illegal income, “especially serious” circumstances or “relatively large amounts” of illegal income. The vague language of the Chinese Criminal Law discouraged software owners from pursuing criminal proceeding; criminal cases seem to be increasing however since the promulgation of monetary criteria.
The Interpretation of the Supreme Court defines what level of piracy equals a crime—if you are engaged in the business of making copied software you may face jail if your profit exceeds RMB20,000 or your turnover exceeds RMB100,000.
In cases where the infringing party is a company or other organization, fines apply to the enterprise or organization involved and prison terms apply to the personnel directly responsible for the infringing acts. In addition to the above penalties, infringers are liable to pay compensation for damages suffered by parties whose copyrights have been infringed and counterfeit products and production equipment can be confiscated.
The introduction of criminal penalties has not resulted in any noticeable deterrent effect. The People’s Procuratorate have been unwilling to prosecute IP-related criminal activity. At the time of press, the author was not aware of a single criminal conviction for pirated software.
(2) Administrative method
Enforcement of software copyright through the administrative channel is carried out by the NCA and by local copyright administrative authorities. The NCA is responsible for investigating serious infringement cases and, in accordance with the Implementing Regulations, administrative actions against infringements involving foreigners are handled by the NCA at the central level. Local copyright administrative authorities generally handle the investigation and adjudication of local copyright disputes and infringements. The Administrative Punishment of Acts of Copyright Infringement Implementing Rules, describes the procedures for conduct of administrative actions and provides that copyright authorities may seek assistance from other government departments in conducting raids.
The preferred enforcement route for owners of intellectual property rights tends to be the administrative channel. This route offers several advantages including a relative degree of expertise on the part of the officials concerned and the ability to carry out speedy raid actions.
The unfortunate provision that cases involving foreign copyright owners must be handled through the NCA, however, presents an implement to the enforcement of software copyright. The NCA suffers from an acute lack of manpower and funds, in response to which it set up a commercial subsidiary to investigate copyright infringement. It is severely under-resourced and is reportedly only employing as few as five members of staff to tackle the tasks. It has also been reported that, in an effort to pursue enforcement actions, some rights owners are having to provide various items such as mode of transport as well as having to meet all the costs that might be incurred in carrying out such actions. The infringed party may be required to obtain supplementary evidence through this agency, including hefty investigation fees in the process, before the NCA will take the investigation further.
The NCA’s investigative resources are also extremely limited and the statutes do not define the powers of NCA officers to enter premise. Its administrative powers extend to the imposition of penalties including the confiscation of unlawful income and the imposition of fines. It is unclear whether the level of fines set in Article 51(2) of the Implementing Regulations, of between RMB10,000 and RMB100,000 or between two and five times the total fixed price apply to infringement of copyright in computer software. Until clarification is obtained, it can only be assumed that Article 51(2) will be applied by reference.
The main disadvantage of administrative actions in copyright cases is the fact that officials are often reluctant to make good compensation awards. The Implementing Regulations gives the NCA the power to award compensation to injured parties, however, it is unclear whether this applies to computer software cases. Since the award of compensation is not explicitly mentioned in the Computer Software Regulations, it is possible that the NCA will not be willing to make such awards. It is more likely to push the complainant to request an award of compensation from the appropriate court.
Fortunately, a joint circular entitled the Sever Crackdown on Copyright Piracy and Other Acts of Copyright Infringement Circular, was issued which provides a formal role for local Administration for Industry and Commerce (AIC) in the battle against computer software piracy. Local AICs have been activity involved in the enforcement of Chinese trademark law for some time and it is their involvement that offered the degree of experience, flexibility and speed necessary to enable effective enforcement action to be carried out against computer software infringers.
The Chinese Trademark Law and other laws clearly define the powers of the AICs. They have the power to:
· Enter premises
· Seize accounts and records
· Seal and destroy goods;
· Impose fines;
· Award compensation;
· Destroy infringing materials;
· Revoke business licenses.
The Joint Circular confirms that these powers may be exercised in the enforcement of computer software copyright.
Fines that may be imposed may be up to five times the total fixed price of the illegal products involved or between five and ten times the amount of illegal income.

IV. Others Protection for Computer Software in China
1. Patent Protection
Computer software per se may be protected by the Software Regulations. However, it protects the expression of a work but not the idea. The inventor of an invention containing a computer program often wants not only that the expression of the software as a work be protected against copying, plagiarizing, adapting and disseminating by others, but also that the creative idea of the invention be protected. Thus, the inventor might tend to seek patent protection.
The Chinese Patent Law and its Implementing Regulations stipulate the various conditions under which the patent right may be granted for an invention / creation. However, mental activities are excluded from the patent protection. It is well known that computer programs per se belong to the category of mental activities, and cannot be granted patent right according to the Chinese Patent Law. As for the carriers recording computer programs, it is expressly indicated that “where a patent application for invention is only related to a computer program per se or the computer program only recorded in a carrier (e.g. a magnetic tape, disc and any other carrier readable by a machine), the program itself, in whatever form it materializes, falls into the rules and processes in the category of mental activities. Therefore, it cannot be granted patent right.”
Since its establishment, the Chinese Patent Office has been attaching great importance to the study of computer software protection, and been constantly taking active measures to strengthen the protection thereof. For the past few years, the Chinese Patent Office has received and approved a large number of patent applications for computer software. What computer software can be placed under patent protection? Computer software eligible for such protection must be computer programs that are used on computers and can achieve technical effects. “Being used on computers” means that a computer program can merit protection under the patent law only when it is operating and must operate on a computer. “Achievement of technical effects” is a relatively abstract concept.
Viewed from the angle of the claim of a patent, the articles most relevant to inventions containing computer programs may be divided into three classes. The first class involves the requirement that the subject matter of an invention should be the object of protection by the Patent Law. The second class involves the requirements for drafting that the claims should meet. The third class involves the requirement that the technical solution as defined by the claims should possess patentability.



2. Customs Protection
On July 5, 1995, the State Council promulgated Regulations on Customs Protection of Intellectual Property Rights (Customs Regulations). The Customs Regulations forbids the importing and exporting the goods that infringe intellectual property rights protected under the current Chinese laws and administrative regulations.
To take advantage of Article 3 of the Customs Regulations, a software owner firstly must apply to the General Customs Administration to record his intellectual property rights for customs protection. If the application to record is approved, the owner would be entitled to request the customs to take protective measures where he deems it necessary. A record for customs protection comes into effect from the date of approval by the General Customs Administration and is valid for seven years. The record can be renewed within six months prior to its expiry, and each renewal will extend the record for another seven years. If a record for customs protection is not renewed prior to expiration, or the intellectual property rights has terminated, the record will expire immediately. When an intellectual property right has not been recorded for customs protection, the software owner may nonetheless request the customs office to adopt protective measures, provided that he also applies to record the intellectual property right for customs protection at the same time.
The primary protective measure for the software owner is the detention of suspected infringing software at the customs ports. Where detention is effected, the customs office shall, within fifteen days from the date of detention, commence an investigation into matter relation to the software detained. If the detained software is found to be infringing by the customs office, it will be confiscated by customs office and software that infringes copyright will be destroyed.
In the unlikely event that the software owner is concerned not about infringing software, but non-infringing copies of his software “coming from a country where his work is not protected”, he cannot rely on the Customs Regulations but rather the Treaties Provisions. Foreign software owners enjoy a right in China not expressly available to domestic software owners, namely, the right to prohibit importation into China of (1) infringing copies of his work; and (2) copies “coming from a country where his work is not protected”.

IV. Conclusion
It ahs been nearly ten years since China installed its current copyright system. Despite the progress made by China in this area of the law, for most software owners the primary concern remains to be the protection in reality which their software may enjoy in China.
Chinese authorities have taken steps to improve copyright legislation and to cooperate with software copyright owners in fighting software infringement. Misunderstanding still arise at a practical working level, particularly in remote parts of the country, as authorities are not yet totally familiar with copyright actions and enforcement. The general difficult atmosphere of enforcement in China is likely to continue, with constantly changing rules, regulations and procedures developing. The level of protection for software will only improve if copyright owners continue to seek to enforce their rights and if the Chinese government recognizes the benefits to China of taking firm action against software infringement.

　

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