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The Law Society of Hong Kong
香港律師會
Intellectual Property: Business
Opportunities and Changes for
Hong Kong Professionals
Michael Lintern-Smith
President, The Law Society of Hong Kong
24 November 2004
1
Recent Development
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CEPA in 2003; CEPA II in August 2004
Preferential market access treatment
Pan-PRD Regional Co-operation and
Development
Barrier-free economic zone
2
Market Access Under CEPA –
Legal Services
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Operate in association with Mainland law firms
Employed by Mainland law firms
Acquire Mainland legal professional qualification
Intern & practise on non-litigation legal work in
the Mainland
Minimum residency requirement waived/
shortened
No permit needed for providing assistance on
individual cases
3
Market Access Under CEPA –
Legal Services (2)
Comparison of representative offices of Hong Kong law
firms before and after the implementation of CEPA
No. of
Representative
Offices of HK Law
Firms
As at
31/12/2003
As at
3/7/2004
No. of new
representative
offices after
1/1/2004
Guangdong/ PRD
12
15
3
Beijing
19
19
0
Shanghai
15
16
1
2
4
2
48
54
6
Others
Total
4
Market Access Under CEPA –
Trade Mark Agency Services
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Hong Kong service supplier (HKSS) may conduct
trade mark agency business in the Mainland
HKSS Certificate:
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A natural person/ a juridical person
Engage in substantive business operation for > 3 years
Pay Hong Kong profits tax
Maintain business premises in Hong Kong
50% employees are Hong Kong residents
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Market Access Under CEPA –
Patent Agency Services
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Hong Kong permanent residents
Chinese citizenship
Patent Agent Qualification Certificate
Practise patent agencies established
with permission in the Mainland
Become partners/ shareholders
6
Market Access Under CEPA –
Patent Agency Services (2)
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Liberalisation of Patent Services
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Equal basis as Chinese citizens
Expand the list of Mainland recognized
universities
Training course organized by IPD
Allow to write the examination
Requirement of Apprenticeship
Become partners/ shareholders
7
Reality Check
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Separate professions:
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Legal
Trade Mark Agency
Patent Agent
Varying opportunities / limitations to
access the Mainland market
8
Reality Check (2)
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Market accessibility: partial
Justified restriction
Overly restrictive
Write qualification
examinations
Post-qualification
employment
Discourage HK
residents to acquire
the qualification
9
Reality Check (3)
Market of Trade Mark Agency
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30,000 trade mark applications/ month
4,000-5,000 existing agents
US$225-425 of fee income/ application
Yearly income: US$1,350-3,187
Strategies – Profitable business
10
Meeting The Challenge
CEPA & Pan-PRD Regional
Co-operation & Development
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Big booster to HK economy
Market liberalisation: controlled pace
Position ourselves to exploit the opportunity
How to further the co-operation
Maximize the benefits for both sides
11
Meeting The Challenge –
Continuing the dialogue
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CEPA
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Not a one-off agreement
Set out framework for consultation
Goal: liberalising the Mainland market
HK professionals
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Feed concerns to HKSAR government
Exchange ideas (e.g. Forum/ Workshop)
Work out practical, achievable suggestion
12
Meeting The Challenge –
Wider Perspective
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Free of import tariff
Hong Kong products
 Substantially transformed in Hong Kong
 >30% of the value is added in HK
Encourage foreign companies
 To set up operations in HK
 To outsource processes to HK companies
More opportunities for HK IP professionals
 IP elements in R&D/ design
 Legal aspects of outsourcing & licensing
 Company formation
 Tenancy/ Employment
13
Meeting The Challenge –
Wider Perspective (2)
Example I: Chinese language motion pictures
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Import to the Mainland – quotation free basis
Jointly-produced by HK & the Mainland –
“Mainland” motion pictures
Increased business opportunities for
IP professionals
Joint ventures/ copyrights/ film distribution
14
Meeting The Challenge –
Wider Perspective (3)
Example II: Communications services sector
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HK service suppliers – set up joint venture
enterprises
Provide value-added telecommunications
services
Increased business opportunities for IP
professionals
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Technology transfer/ branding/ co-branding/
licensing/ joint ventures
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Meeting The Challenge –
Wider Perspective (4)
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CEPA – Preferential treatment
Over 700 product categories
26 service sectors
IP opportunities arise from increased trade
Brand is essential in marketing
Need for IP protection, enforcement &
commercialisation
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Meeting The Challenge –
IP Protection
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Past: Inadequate awareness of IP protection
Present: Economy progresses
IP becomes a competitive edge
 Identify products
 Protect investment
 Realise profits
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Meeting The Challenge –
IP Protection (2)
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IPD – Raise awareness about IP
Law Society – supply speakers at the following seminars
organized by the IPD:-
Date
Event
Held
02/2003
Seminar on IP & the Development of SMEs
Hong Kong
03/2003
Seminar on Guangzhou and Hong Kong IP Services
Guangzhou
06/2003
Seminar on IP for Design Professionals
Hong Kong
09/2003
Seminar on IP and the Development of SMEs
Shenzhen
05/2004
Seminar on IP and the Development of SMEs
Dongguan
11/2004
Seminar on IP and the Development of SMEs
Shaoguan
12/2004
Seminar on IP and the Development of SMEs
Shunde
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Meeting The Challenge –
IP Protection (3)
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Law Society’s participation
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Supported TDC’s Roadshows & exhibition
11 trips to Mainland in past 1 year
Delegations to Beijing, Shanghai, Chongqing,
Guangzhou, Jilin, Tianjin & Zhejiang
Held exhibitions on HK legal services
More participation in the future
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Meeting The Challenge –
Mainland Representative Office
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More law firms consider establish
representative offices in the Mainland
Contributing factors
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CEPA – to associate with Mainland firms
Reduction of the requirement of residency
20
Meeting The Challenge –
Mainland Representative Office (2)
Condition to apply to the Ministry of Justice of China for approval
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Lawful practice in Hong Kong
Representative of the office shall be 
Practicing lawyer
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A member of Law Society
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Practicing >2 yrs outside the Mainland
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No record of criminal offence/ professional/ misconduct
Chief Representative of the office shall be 
Practicing >3 yrs outside the Mainland
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A partner in the law firm
Genuine need
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Meeting The Challenge – Collaboration
with Mainland Lawyers & Agents
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Serving Mainland clients through referrals
Benefit from closer co-operation with Mainland
companies
Role of the Law Society
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Develop contacts with provincial lawyers associations
Facilitate exchange of information
Develop opportunities for training
Example: Jiangsu Lawyers
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Meeting The Challenge –
Recruitment and Training Strategies
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Recruitment Strategy
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Chinese language ability
Science/ engineering background
Minimum requirement for establishing a
patent agency
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Partnership: 3 qualified patent agents
Company: 5 qualified patent agents
Partner/ shareholder: no non-qualified people
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Meeting The Challenge –
Recruitment and Training Strategies (2)
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Training Strategy
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LL.B / LL.M Programmes provided by universities
in the Mainland
China Law Seminars organized by the Law Society
- Seminar in Shenzhen
- Accredited courses on PRC
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Conclusion
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CEPA & Pan-PRD development –
business opportunities
IP professionals – understand the new
environment
Importance of idea exchange
Role of the HKSAR Government
Role of the Law Society
25