China has been making strides in changing its image from a nation of copyright copiers and pirates to a nation of innovators and copyright protectors.
In this mission, the National Copyright Administration just announced it will increase copyright scrutiny on short-video platforms such as Kuaishou (HKEX: 1024; OTC: KUASF), ByteDance, and Bilibili Inc. (Nasdaq: BILI; HKEX: 9626).
The statement, issued Sunday at a press conference, followed a mid-April report by the state-run Securities Times saying a group of China’s top companies in the film industry threatens legal action against short video platform operators. The group included Alibaba’s Youku, Tencent Video, and iQiyi (Nasdaq: IQ).
China has been known for piracy, which goes not too far from IP infringement and stealing trade secrets – this was one of the causes in the hostility toward the nation started by ex-President Donald Trump. It is no wonder the world’s hottest short-video apps started here – in March 2021, again, ByteDance’s TikTok topped the list of the most downloaded non-gaming app worldwide, according to SensorTower.
The country has, however, taking certain steps to curb copyright infringement. Last month, state media Xinhua Net said, citing the Ministry of Public Security, that more than 21,000 crimes related to infringement of intellectual property rights and production of fake and shoddy products were solved in 2020 and involved about 32,000 suspects, with about $2.8 billion in fines and settlements distributed.
Earlier this year, President Xi Jinping issued directives on strengthening the protection of intellectual property rights (IPR) and “stimulating the vitality of innovation.” Xinhua quoted the president’s statement: “China is changing from a big IPR importer to a big IPR producer, and from pursuing IPR quantity to improving quality.”
As the National Law Review wrote in early April, the first “substantial” changes to China’s Copyright Law in 20 years will take effect on June 1. The amendments better align the nation’s law with international standards, increase the maximum fines, and improve the definitions of protected works, among other changes.
And the national push against piracy has spread to the social video segment. Tencent-backed Kuaishou was especially hit with increased scrutiny as it moved toward its initial public offering in February. TikTok’s main rival became publicly traded in Hong Kong after a $5.4 billion offering – and was simultaneously fighting off accusations of “massive copyright infringements,” as reported by Caixin Global.
Just how Kuaishou, Bilibili, and Douyin – the Chinese version of TikTok, will enforce copyright protection remains a concern. The apps’ millions of users upload millions of videos per day and stream in real-time.