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One area of unwanted attention, from the Chinese perspective, concerns intellectual property rights ("IPRs") protection. Internationally, China has entered into various intellectual property("IP") agreements and treaties, thus demonstrating its commitment to greater protection for intellectual property rights.4 These efforts have resulted in China adopting and implementing strong substantive intellectual property laws. But, despite the changes in legislation, China has failed miserably to enforce these laws.5
China's failure to protect intellectual property rights has prompted the United States, after many failed negotiations, to file a WTO complaint against China. Among other things, the complaint targets China's criminal intellectual property laws, alleging that these criminal laws do not provide a sufficient deterrent to trademark and copyright infringement, and fails to provide adequate remedies for willful trademark infringement and copyright piracy occurring "on a commercial scale," thus violating obligations under the Trade-Related Aspects of Intellectual Property Rights Agreement ("TRIPS"). 6 The deficiencies in China's laws stem from the high thresholds that must be reached before criminal liability attaches. By way of example, China's criminal copyright provision does not impose liability unless theinfringer makes, sells, or distributes more than 500 infringing copies.7 The United States contends that these high thresholds are inconsistent with TRIPS' required criminal penalties, which were seen as a necessary component of international intellectual property reform as a means to punish and deter the more egregious acts of infringement.8
While the United States' complaint raises important legal and social issues, the difficulty of proving the allegations in the complaint cannot be understated. The United States must prove that China's laws are insufficient to deter infringement or capture large-scale piracy. In other words, the United States will have to demonstrate that "but for" the allegedly high thresholds, China's laws would criminally penalize a substantial portion of currently unreachable infringers. This will be a fact-intensive inquiry and it is not clear that the United States can marshal satisfactory factual data to support the claim. Moreover, in light of the vague language used in TRIPS' enforcement provisions, it is unclear how a panel will interpret key phrases in the relevant TRIPS provisions. A WTO panel is likely to grant China wide discretion in implementing its TRIPS obligations.