Industry Specific Issues

Last Updated: June, 2010

Music and Film

Taiwan is the world's largest producer of blank OD products. The International Intellectual Property Alliance alleges that Taiwan manufacturers sell blank OD products to criminal organizations in Latin America and other parts of the world knowing that the products will be used to create intellectual property infringing goods.

Domestic optical disc piracy, however, is no longer a major problem in Taiwan. As legitimate CD sales in Taiwan have dropped by over half since 2005, the percentage of pirated copies has dropped from almost 40 percent in 2005 to a steady 22 percent over the past several years. Due to this drop in physical sales--as well as increased enforcement by Taiwan IP authorities--industry reports there are now no more than 20 physical outlets island-wide for pirated CDs, most of which are night market stalls, down from about 30 in 2007 and 250 a decade ago. Movie industry representatives report a similar drop in the large-scale production and distribution of physically-pirated DVDs.

Rights-holder groups believe that most domestic physical movie counterfeiting is now smaller-scale burning of counterfeit DVDs on home computers, with the majority of pirated DVDs coming from overseas mail-order sites that take orders over the Internet and deliver physical copies by mail.

Digital piracy of music and movies, however, remains the number one concern in Taiwan for movie and music industry groups. Industry statistics, however, show rights holders are becoming more effective at enforcing their intellectual property rights online: in 2009, in response to takedown letters asking major Internet service providers (ISPs) and auction sites to remove unauthorized music and movie content, close to 100 percent of allegedly unauthorized files were removed.

The Taiwan authorities have taken steps in recent years to to improve the island's ISP-related legislative framework. In 2007, Taiwan passed legislation providing a legal basis for prosecuting online peer-to-peer platforms whose service allows for the exchange of IPR-infringing materials, and by the end of 2007, the authorities had shut down two of the largest P2P service providers in Taiwan. In April 2009, the Legislative Yuan (LY) passed amendments to the Copyright Act that clarify ISP's responsibilities to protect copyrighted materials, limit an ISP's liability if the provider quickly removed IPR-infringing material, and allow ISPs to terminate or limit service for users who ignore three notices of infringement from the ISP. Taiwan became the second jurisdiction in the world to codify such a "three-strikes" measure. 

Pharmaceuticals

In 2004, the International Pharmaceutical Research Manufacturers Association (IRPMA) and local representatives of multinational pharmaceutical companies reported that twenty-five percent of all pharmaceutical products sold on the Taiwan market--and up to fifty percent of some popular pharmaceuticals--may be counterfeit or unlicensed. That year, Taiwan's Legislative Yuan passed amendments to the Pharmaceutical Law, increasing penalties for anyone convicted of manufacturing, transporting or selling counterfeit pharmaceutical products. These changes, as well as increased enforcement by the police and IP authorities, have reduced the counterfeit pharmaceutical rate to less than one percent by market value, according to local industry sources.

Books, Journals, and Other Copyrighted Publications

In 2007, the Ministry of Education (MOE) initiated the still-ongoing Campus IP Action Plan. Under the Plan, the MOE introduced new IPR-related requirements and targets for Taiwan universities, and publicly grades each university's performance on numerous metrics in order to promote best practices.

One of the Action Plan's targets is illegal textbook copying, and Taiwan university administrators tell us that the Plan has successfully curtailed on-campus copying of textbooks, and that off-campus copy shops are either more reluctant to copy textbooks in whole or in part, or have begun to refuse to copy more than a few pages of any one book.

The Taiwan Book Publishers' Association (TBPA), however, continues to complain that the situation has not improved significantly, and has merely gone underground, with off-campus copy shops taking orders through representatives on campus, and delivering books directly to customers. Recent academic surveys of students at Taiwan universities show that over half of Taiwan college students admit to having bought a pirated textbook or having photocopied at least one entire textbook.

Software

According to the latest Business Software Alliance (BSA) surveys, 39 percent of member-company software used in Taiwan in 2008 was unauthorized. This is a one percentage-point drop from the 2007 figure, and places Taiwan third-best in Asia--behind only Japan and Singapore--and 23rd worldwide.

The true picture of software piracy is likely worse, however . Software company representatives believe survey methodologies often undercount the level of unauthorized use, which can include illegal copies, expired licenses, and under-reporting of licensed users.

Additional Resources

Information on organizations, government agencies, and law firms handling IPR-related issues is available here.