China has faced international pressure on its handling of intellectual property rights (IPR) five to ten years earlier than predicted, a senior Chinese IPR governor has said.

"More and more Chinese companies have come under pressure from IPR issues with the rapid economic development in the country," Tian Lipu, director of the State Intellectual Property Office (SIPO), said at a meeting on IPR protection.

Among the 111 complaints the US International Trade Commission (USITC) had lodged under Section 337 of the Tariff Act of 1930, 42 were against Chinese enterprises, said Tian.

Under Section 337, imported products that allegedly violate US IPR can be barred from entry into the United States. Complaints under Section 337 are made to the USITC and generally involve allegations of infringement of patents, trademarks or copyrights.

Patent payment and the amount of compensation foreign companies have claimed was increasing, Tian said. Chinese companies had paid three billion yuan (US$375 million) for DVD production.

A growing number of industries were involved in IPR disputes, from lighter and pen manufacturing to bio-pharmacy and computer chip production, he said. Patent suits lodged by foreign companies were threatening the economic security of certain Chinese industries.

"Domestic companies must strengthen their IPR awareness, improve their innovative capacities and be active in patent applications at home and abroad," he warned. "When facing lawsuits, they should heed domestic and international laws on IPR."

"Almost all medical instruments, semiconductors, integrated circuit and optic fiber manufacturing equipment, 80 percent of petrochemical equipment and 70 percent of car manufacturing, advanced textile production and offset equipment in China are imported," a SIPO official who declined to be named told Xinhua on Monday

A major television set and cellphone manufacturing country, China depended on more than half of the key technologies of the two products owned by multinational corporations.

"We must pay royalties for a personal computer, a DVD player and even a mouse," the official said.

(Xinhua News Agency June 20, 2006)