TAIWAN 7. Protection of U.S. Intellectual Property Rights Taiwan is not a member of the World Intellectual Property Organization or party to any of the major intellectual property treaties. However, on November 1, 1989, Taiwan was moved from the U.S. Trade Representative's Special 301 "priority watch list" to the "watch list" under the provisions of the 1988 Omnibus Trade and Competitiveness Act because of "significant progress in protecting intellectual property rights. Taiwan is increasingly developing more capital- and technology-intensive industries. Partly to foster this economic transition and to conform to international standards of intellectual property rights (IPR), Taiwan's authorities have steadily improved IPR protection. In general, IPR laws such as the copyright and patent laws are moving toward international standards. However, there is still much to be done. For instance, the fair trade law providing protection for trade dress has yet to be adopted. The existing tariff law does not effectively prohibit the import of counterfeit goods. Taiwan has not yet passed an industrial secrets law, semi-conductor chip law, data base law, or cable T.V. law. Although some of these laws are in the drafting stage, U.S. intellectual property rights on certain items cannot be effectively protected in the interim. The enforcement of IPR laws remains U.S. companies' main concern. Taiwan authorities, such as the National Police Administration, the Ministry of Interior, and the Anti-Counterfeiting Committee (ACC) of the Ministry of Economic Affairs, are more cooperative in cracking down on counterfeiting activities. However, local police units have not always taken prompt action. More importantly, the judiciary has frequently imposed light sentences on IPR infringers, thereby weakening the deterrent effect of criminal penalties. Specific IPR problems: Patent issues: The draft patent law is now under consideration by the Ministry of Economic Affairs. This draft includes a number of important improvements over the 1986 law. It removes exemptions from patentability for food, beverages, habit-forming articles, micro-organisms, and new uses of products. The draft law also accords a right of priority on a reciprocal basis. However, there are still several areas where further amendments are necessary. In particular, the definition of invention to include a high level of technology is vague, compulsory licensing provisions are too sweeping, and the right of administrative appeal (for non-technical decisions) is too restrictive. Trademark issues: The trademark law revision will be submitted to the Legislative Yuan in March 1991. Provisions for the implementation of an international classification have been included in the draft, but there is no timetable for its adoption. In addition, the highly general rules currently used in trademark examination procedures are to be made more specific. The problems of counterfeiting world-famous trademarks are still serious in Taiwan, chiefly due to enforcement difficulties in locating factories and rendering credible penalties. TAIWAN Copyright issues: The draft copyright law was submitted to the Executive Yuan in July 1990. This revision includes many significant improvements, such as extended term of protection, retroactive protection for works created after 1965, and protection of translation rights for foreign works. This revision is consistent with the AIT-CCNAA copyright protection agreement and will bring Taiwan's copyright protection up to international standards. Taiwan's most famous copyright case, involving Encyclopedia Brittanica, remains in litigation two years after its filing. During this time, the infringing company has continued to sell its pirated books and other pirated editions have appeared on the market. The piracy of computer software remains a major problem. Recently, two local private software associations were formed to crack down on piracy. The U.S. Business Software Association (BSA), with the help of the ACC and local police, also conducted several successful raids on manufacturing and distribution networks. In November 1989, the BSA conducted raids on three local firms using pirated software programs. One company reached an out-of-court settlement, while the other two firms were prosecuted. This kind of initiative has begun to discourage software piracy, but the problem remains serious. MTV and rental rights issues: Since Taiwan's Government Information Office (GIO) launched enforcement actions against illegal videotape viewing studios (MTVs) in early 1989, the number of such studios has fallen from 649 to 199 as of October 1990. In January 1990, Taiwan authorities fulfilled their commitment to adopt fast-track amendments to the copyright law, thereby providing statutory protection for public performance rights. However, MTV owners and the Motion Picture Export Association of America (MPEAA) theatrical agents have yet to reach an agreement on royalties for public performance rights. The unauthorized showing of videotapes on illegal cable TV systems is also a growing problem. The so-called fast-track amendments to the copyright law adopted in early 1990 eliminated rental rights protection for copyright owners of sound recordings and computer software. To address this problem, AIT and CCNAA concluded a rental rights agreement in March 1990 which establishes administrative rules impeding the unauthorized copying of these works, effective July 1990. To date, rental shops have not emerged as a serious IPR problem. - New Technologies: Semiconductors, cable TV systems and satellite receivers represent new technologies posing additional intellectual property rights issues for U.S. firms. Taiwan is drafting legislation to address some of these issues, but the laws are in various stages of preparation. The draft chip act -- similar to U.S. legislation is currently being drafted by the National Bureau of Standards (NBS). The cable law is undergoing public hearings and will be submitted to the Legislative Yuan in early 1991. There is no satellite broadcast law presently under consideration. However, small satellite receivers are common in Taiwan. Impact of IPR infringement: The costs of IPR infringements to U.S. industries are difficult to estimate. There is no corroborating evidence for figures supplied by U.S. firms. However, a 1986 International Trade Commission TAIWAN survey reported that U.S. firms estimated some $750 million in worldwide sales are lost every year as a result of Taiwan's infringement in the areas of publishing, computers, and electronics. On the other hand, an April 1989 report of the International Intellectual Property Alliance estimated 1988 copyright losses due to piracy in Taiwan at about $90 million, about one half of their 1984 estimate of $186 million. 8. Worker Rights * a. Right of Association Taiwan's labor union law permits all workers to organize unions except for civil servants, educational personnel, and defense industry workers, as long as the unions obtain approval from the central authorities. Workers' rights to strike are circumscribed. Technically only a few legal strikes have occurred since martial law was lifted in mid-1987 although many illegal ones have taken place. b. Right to Organize and Bargain Collectively Collective bargaining is provided for under the Collective Agreements Law but is not mandatory. Although only about 329 collective agreements were in force as of June 1990, collective bargaining has become more common in Taiwan's industrial relations. Since such agreements are made primarily in largescale enterprises and less than 5 percent of Taiwan's enterprises fall into this category, the proportion of workers covered by them is small. Legal restrictions on the right to strike and provisions for involuntary mediation or arbitration tend to weaken collective bargaining. Most collective actions by workers consist of such technically illegal actions as work stoppages and mass leave-taking. C. Prohibition of Forced or Compulsory Labor Taiwan's labor standards law promulgated in August 1984 prohibits forced or compulsory labor. Violations are punishable by a maximum jail sentence of five years. d. Minimum Age for Employment of Children The Labor Standards Law stipulates that the minimum age for employment is 15, and interaction between this law and a compulsory education law effectively keeps child labor minimal. The Taiwan Labor Standards Law, promulgated in 1984, was enacted to provide minimum labor standards. According to the Taiwan Council on Labor Affairs, it currently covers some 3.4 million of Taiwan's 5.7 million paid workers. By law, the workweek is limited to 48 hours (eight hours per day, six days per week) with certain provisions for overtime. Taiwan has no statutory minimum wage. Effective August 1, 1990, the "basic" wage in Taiwan became $360 per month, a 10.5 percent increase over 1989. The real earnings of most workers are much higher than the basic wage set by authorities. Rising labor consciousness and continuing labor shortages have reportedly resulted in some improvements in working conditions. However, TAIWAN many provisions of current labor legislation are being ignored by some employers. f. Rights in Sectors with U.S. Investment U.S. firms or joint ventures here abide by Taiwan's labor regulations. U.S. firms also tend to provide model work conditions both in wages and other items. Worker rights do not vary significantly by industrial sector but conditions of work do. Cumulative U.S. investment on Taiwan totaled US$3.1 billion at the end of 1989 according to Taiwan statistics. About two-thirds of this amount was invested in the electrical/ electronic and chemical industries. Workers in those sectors generally enjoy better vocational training and fringe benefits than those in other sectors. Source: U.S. Department of Commerce, Survey of Current Business August 1990, Vol. 70, No. 8, Table 13 * Section 8 is an abridged version of Section 6 of the Taiwan country report included in the Department of State's Country Reports on Human Rights Practices for 1990, submitted to the Congress January 31, 1991. For a comprehensive discussion of worker rights, please refer to that report. |