Assisting to establish Taiwan as the model for effective intellectual property rights protection in the Asia Pacific region.
Taiwan continues to make advances in intellectual property protection, an area of pressing concern globally. Recently Taiwan marked the 10th anniversary of the establishment of its IP Court, which has provided rights-owners and other stakeholders with a high degree of certainty regarding the protection of IP rights in Taiwan. While much progress has been made, all stakeholders in Taiwan could benefit greatly from further steps to provide adequate IP protection, particularly in the areas of copyright law and trade-secrets protection. With that in mind, the Committee presents the following suggestions with the aim of providing clear, desirable, and readily attainable solutions to outstanding problems. Progress on these issues would send a strong signal that Taiwan is serious about enhancing its intellectual property regime.
Suggestion 1: Adopt a multi-pronged approach to combating online piracy
A multi-pronged approach is required to address online piracy, which is a problem that can take many forms. For example, OTT (“over-the-top”) piracy platforms have become a significant source for the dissemination of illegal content in Taiwan. Piracy websites and OTT devices – for example, media boxes, set-top boxes, and their corresponding software applications – are increasingly used to facilitate various forms of piracy. Pirate OTT devices make it easier for unsophisticated users to connect to foreign piracy sites, gaining access to unauthorized copyrighted content. This presents a major concern for rights-holders doing business in Taiwan. Another common form of digital piracy is stream-ripping, which involves websites or services taking audio or video from legitimate streaming platforms like Spotify or YouTube and converting it into MP3 or MP4 files for download without any payment to rights-holders.
Much of the infringing material made available via pirate OTT devices and online stream-ripping services is hosted overseas. While injunctive relief is available for domestically hosted infringement, no remedy is available to address the problem of foreign websites. This situation has caused a great deal of harm in the Taiwanese marketplace for many years now.
In its current state, the law cannot adequately address these issues. For example, since it first passed in 2007, Article 87.1(7) of the Copyright Act has been interpreted by law enforcement and the judiciary as applying exclusively to copyright infringement involving reproduction and transmission via peer-to-peer (P2P) technology. However, last October the Taiwan Intellectual Property Office (TIPO) clarified that Article 87.1(7) of the Copyright Act is not restricted to P2P infringement. The Committee welcomes the TIPO’s position on Article 87.1(7), but notes that there is still no way to apply Article 87.1(7) to stream-ripping services. An effective solution to block infringement of this kind is urgently needed.
In a commendable attempt to address the ongoing problem of OTT piracy, lawmakers have proposed Article 87.1(8) – dubbed the “OTT Bill”– as an amendment to the Copyright Act. This amendment was passed by the Legislative Yuan on April 16, 2019, and was promulgated on May 1, 2019. The OTT Bill would allow criminal charges to be brought against offenders who knowingly broadcast or transmit infringing content with the intent of making it accessible by the general public, and who further receive a benefit by way of the following: (a) intentionally providing users with software or applications by aggregating IP addresses stored with the infringing content, (b) helping users to exploit such software or applications, or (c) manufacturing, importing, or selling equipment or devices containing infringing software or applications of the kind mentioned in (a).
The Committee thanks TIPO for its role in supporting the OTT Bill. In addition, the Committee calls for strict enforcement of the OTT Bill, but also strongly suggests removing the “receiving benefit” requirement currently found in Articles 87.1(7) and 87.1(8), as it imposes an unduly heavy burden of proof on rights-holders.
Suggestion 2: Amend the Copyright Act to keep Taiwan from falling further behind international standards.
Recent draft amendments to the Copyright Act, as submitted by the Executive Yuan and currently under consideration by the Legislative Yuan, do not adequately address the issue of online piracy. The Committee suggests further amendments to specifically address this issue, as well as an amendment to bring Taiwan’s term of copyright protection in line with the evolving global norm of at least 70 years of protection for creators.
Further draft amendments have been submitted to the Legislative Yuan to prepare for Taiwan’s application for membership in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). However, these further draft amendments share many of the same issues as the Copyright Act amendments proposed by the Executive Yuan. Both sets of amendments would result in an inadequate term of copyright protection, a weakened enforcement framework for pirated optical discs, and a lack of any effective remedy against foreign-hosted infringements.
The Committee welcomes the CPTPP bill’s expansion of the scope of internet piracy to make it a criminal offense. However, the bill imposes an unacceptable requirement that the “whole” work must be exploited “for consideration,” and that the damage caused thereby must exceed NT$1 million. This threshold is far too high, and is unfair to certain sectors whose goods have a low market price (e.g. the book publishing and music industries). The Committee recommends further amendments to address the shortcomings of the CPTPP Bill.
Suggestion 3: Strengthen enforcement to block counterfeit and infringing goods from entering Taiwan.
Taiwan continues to struggle with the problem of the importation of counterfeit and infringing goods. Attempts to address this problem have had limited success due to the lack of adequate inspections by Customs. When shipping counterfeit products from overseas, infringers have increasingly relied on express courier services for which no significant amount of inspection is conducted by Customs, and for which no genuine sender information is required. This creates a major loophole in the investigation and enforcement process. We ask that Customs increase the rate of inspections it conducts, particularly when dealing with the courier companies known to be most frequently used by websites offering counterfeit and infringing goods.
TIPO’s “Statistics Report on IP Enforcement Cases Conducted by Various Agencies” lists enforcement cases carried out by the National Police Agency (NPA), Intellectual Property Rights Police (IPR Police), and Ministry of Justice Investigation Bureau (MJIB). Across all agencies, the number of intellectual property and counterfeit enforcement cases decreased from 2016 to 2017 – by 32% in the case of the MJIB.
Last year the Committee suggested that more resources be allocated to the IPR Police. The Committee is pleased that progress has occurred, with the IPR Police receiving more funding and personnel. However, the Committee is still concerned that the number of intellectual property enforcement cases has dropped overall, especially as there is no evidence of a corresponding decrease in the amount of online infringement, which remains rampant. In addition to increasing the frequency of Customs inspections, the Committee suggests that the NPA, IPR Police, and MJIB be given enough resources to effectively combat this issue.
Suggestion 4: Include major violations of the Trade Secrets Act in prosecutors’ and judges’ guidelines for serious criminal cases, and motivate the courts and prosecutors to speed up the adjudication of trade secrets cases.
Trade secrets are recognized as extremely valuable assets that are vulnerable to theft, especially in tech-related industries. Frequent incidents of trade-secret theft pose a serious threat to Taiwan’s economic competitiveness in technology and other key sectors. Effective and timely law enforcement is crucial to addressing this concern.
The MJIB has listed major violations of the Trade Secrets Act (namely Articles 13-1 and 13-2) in its “Guidelines for Determining Serious Economic Criminal Cases.” While the Committee appreciates MJIB’s efforts to prioritize investigations into trade secrets theft, it also urges prosecutors and judges to take the same approach. Coverage of major trade-secrets violations should also be explicitly included in the “Guidelines for Handling Serious Economic Criminal Cases by the Prosecution Authority” and the “Guidelines for Speedy Trial and Decisions in Serious Criminal Cases in Court.”
In addition, Taiwan’s courts and prosecutors have accrued a significant backlog of trade-secrets cases, possibly because the technical nature of these cases tends to increase the amount of time required for adjudication or investigation. Moreover, courts and prosecutors have little incentive to resolve such cases quickly. It would be helpful if Taiwan’s judicial system could provide courts and prosecutors with a clear incentive to deal with the backlog by expediting trade-secrets cases and resolving them in a timely manner, perhaps by offering a reduction in assigned cases.
The Committee believes that the adoption of uniform practices during the investigation, prosecution, and trial stages would motivate courts and prosecutors to speed up the adjudication of trade secrets cases, and would go a long way towards improving trade secrets protection in Taiwan.