VZCZCXRO1481
RR RUEHCN RUEHGH
DE RUEHBJ #1498/01 1582253
ZNR UUUUU ZZH
R 072253Z JUN 06
FM AMEMBASSY BEIJING
TO RUEHC/SECSTATE WASHDC 7973
RUCPDOC/USDOC WASHDC
INFO RUEHCN/AMCONSUL CHENGDU 6467
RUEHGZ/AMCONSUL GUANGZHOU 0721
RUEHHK/AMCONSUL HONG KONG 7576
RUEHGH/AMCONSUL SHANGHAI 4861
RUEHSH/AMCONSUL SHENYANG 6288
RUEHIN/AIT TAIPEI 5680

UNCLAS SECTION 01 OF 02 BEIJING 011498 
 
SIPDIS 
 
STATE FOR EAP/CM - KLEE, EB/IPE - EFELSING 
USTR FOR CHINA OFFICE - AWINTER, ACELICO; IPR OFFICE 
VESPINEL; AND OCG - SMCCOY, TPOSNER, SKHO 
COMMERCE FOR NATIONAL COORDINATOR FOR IPR ENFORCEMENT - 
CISRAEL 
COMMERCE FOR MAC 3204/ LRIGOLI, ESZYMANSKI 
COMMERCE FOR MAC 3043/KSCHLEGELMILCH 
LOC/ COPYRIGHT OFFICE - STEPP 
USPTO FOR INT'L AFFAIRS -- LBOLAND 
DOJ FOR CCIPS -- ASHARRIN 
FBI FOR LBRYANT 
DHS/ ICE FOR IPR CENTER - DFAULCONER 
DHS/CBP FOR IPR RIGHTS BRANCH - PPIZZECK 
 
SENSITVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ETRD ECON KIPR WTRO PREL OREP CH
 
SUBJECT: STAFFDEL BEUTEL TALKS PATENTS, TRADEMARKS AND IPR 
 
 
¶1. (SBU) Summary:  House Small Business Committee Special 
Counsel, Rich Beutel, held meetings with Madame Zhu Lilan, 
Chief Commissioner of the National People's Congress' 
Commission for Education, Science, Culture and Health, and 
Mr. An Qinghu, Director-General of China Trademark Office 
(CTMO).  The meetings covered Intellectual Property Rights 
(IPR) and patents law in China and discussions for an IPR 
breakout session to be held as part of the November Beijing 
meeting of the U.S.-China Interparliamentary Exchange. End 
Summary. 
 
 
Talking Trademarks and IPR Enforcement 
-------------------------------------- 
 
¶2. (SBU) Mr. An Qinghu, Director-General of China Trademark 
Office (CTMO), opened the discussion by saying that his 
office was in the process of revising China's Trademark Law 
to shorten the pending period for a trademark application 
and to set up a self-funding system for CTMO.  He also 
highlighted the dramatic increase in the amounts of 
trademark applications in China during the past 4 years, 
adding that among all foreign applications and 
registrations, the United States leads all comers with 
91,000 trademarks registered in China.  Mr. Beutel welcomed 
the revisions and outlined the advantages of the self- 
funded U.S. Patent and Trademark Office (USPTO) whom 
Congress has given approval to scale its operations and 
prepare associated fees.  In reply to a question concerning 
judicial recourse for IPR related offenses, Mr. Beutel 
suggested that China adopt a centralized IP court system as 
exemplified by the U.S. Federal Circuit Court which 
harmonizes and unifies IP law.  Mr. An said that China had 
already set up provincial level IPR courts.  Mr. Beutel 
warned against the idea of multiple local courts by saying 
that the United States had had a similar system but that 
problems arose from multiple legislative interpretations by 
different courts in different states.  On IPR enforcement 
in markets Mr. An disagreed with Mr. Beutel's assessment 
that increased deterrent penalties against retail markets 
would stop infringing activity as the incentives and 
profits are too great.  Mr. An then said that he had 
instructed increased supervision of markets in response to 
a request from the United States Embassy concerning 
specific markets and also noted that senior Chinese leaders 
had issued instructions to improve the basic level 
enforcement of IPR.  Mr. An informed Mr. Beutel that he 
plans to visit Washington D.C. in June and showed great 
interest in meeting Members of Congress and to learn more 
about the USPTO's self-funding system. 
 
¶3. (SBU) After explaining the background of the U.S.-China 
Interparliamentary Exchange to NPC Standing Committee 
Member and President of the China Inventors Society Zhu 
Lilan, Mr. Beutel provided details about plans to convene 
breakout sessions to discuss issues of mutual interest. 
These sessions would increase understanding on specific 
issues, such as IPR and environmental issues.  Beutel noted 
that they had reached out to NPC Standing Committee Member 
Gu Jianfen to lead a copyright session, but protocol snafus 
have prevented any firm commitment from her end.  Madame 
Zhu said that these exchanges would help increase 
understanding, and from her perspective, an IPR session 
would be of great interest to the NPC.  She added these 
sessions would allow members of the United States Congress 
to understand China's situation and progress on the IPR 
issue, and that both sides could share best practices on 
how to strengthen China's IPR regime.  Zhu also said that 
she would personally reach out to NPC Delegate Gu and the 
NPC Foreign Affairs Committee Vice-Chairman, Lu Congming, 
 
BEIJING 00011498  002 OF 002 
 
 
with her support.  Zhu emphasized that the meetings should 
be focused on specific topics (Note: the NPC is currently 
engaged in a nationwide effort to supervise patent 
enforcement efforts throughout China in conjunction with 
State Intellectual Property Office. End Note). 
 
¶4. (SBU) Zhu also discussed her views on China's homegrown 
innovation.  She said that "homegrown innovation" is not a 
program to shut China off from outside technology and start 
from scratch, but rather a series of policy developments 
that are conducive for Chinese scientific development. 
Proper protection of intellectual property (IP), she 
declared, is an important part of developing technology, as 
are policies to promote small and medium enterprises and 
worker creativity and risk taking. 
 
¶5. (U) Mr. Beutel did not have the opportunity to clear on 
this report. 
 
Randt