Today, we are going to continue our interpretation of the “Regulation on Several Issues concerning the Application of Law in Hearing Civil Disputes on Infringement against the Right to Network Dissemination of Information” (the “Network Interpretations”), basing on the review over the legislature on the right of information communication by networks in China:

Part II, Explanation of Network Interpretations

1. PSP users cannot claim to be free of liability on the basis of a personal use defense.

As provided in Article 22 of the Copyright Law: “For the purpose of private study, research or entertainment, to use a published work of another” will not be deemed infringement because it is considered a fair use of the copyrighted work. However, this article cannot regulate effectively those users who maliciously or wantonly distribute the copyrighted work on the Internet or otherwise. Therefore, it was considered unhelpful in sufficiently protecting the rights of affected copyright holders. Peer-to-Peer (“P2P”) software, like Emule and BitTorrent are not limited to private or individual use only. Although both protocols and software packages are able to download copyrighted works for private use, research, and enjoyment, they also facilitate copyright infringement by allowing end users to upload the copyrighted works to other users. Such use is no longer able to be considered individual use. For this reason Article 3 of the Network Interpretations currently stipulate that:

“to upload or place a work, performance, or radio and audio tape recording on a network by uploading it to a server enabling user sharing settings or using any document sharing software enabling the general public to download, browse or to otherwise acquire a copyrighted work through other methods at any given place or time shall be deemed copyright infringement,” and that shall be judged by the People’s Court to be infringement against network dissemination of information. With such regulations, a copyright holder now has specialized legislation capable of fighting against the use of P2P networks to share its copyright-protected works.

2. Regulations regarding the liability of Website Snapshot Provision

The main function of website snapshots is to assist users in showing them the content of an original website stored in the search engine, when the original website cannot be visited or has since been deleted. However, the storage of a website may be considered as beyond the scope of a search engine’s purpose; in effect making the search engines both internet service providers as well as internet content providers. Under these circumstances, pursuant to copyright law and other network regulations, theoretically, a search engine may not avoid liability under a safe harbor principle when accused of copyright infringement by providing snapshots of websites. Despite this, it cannot be denied that website snapshots are a very practical tool for all network users. The Network Interpretations have specified the ways for setting and using snapshots so that a search engine’s provision of such will not constitute infringement against the right to network dissemination of information.

The Network Interpretation’s Article 5 also provides: An ISP may be exempted from infringement liability when it substitutes the original works provided by others by way of snapshots or thumbnails when meeting the following two conditions: 1. No influence would be made to the normal use of the work involved; 2, No unreasonable damage would be caused to the right holder’s interests thereby affected.”

III. Detailed regulations on the determination of an ISP’s fault.

As clearly provided in the Network Interpretations:

An ISP shall take not be obligated to actively infringement against another’s network dissemination of information right. Provided an ISP is able to show that it has adopted fair, reasonable, and effective measures for detecting infringing activity, but regardless is also able to show that detection of such infringement against another’s network dissemination of information right is overly burdensome, shall not necessarily be deemed liable for any said infringement. However, under circumstances in which an ISP is found to be at fault, it shall be deemed jointly liable based on precedent and years of experience by the courts in adjudicating the following issues:

1. The ISP incites or encourages network users to exploit and infringe the network dissemination of information right of others by means of language, support or promotion of capable technology, credit rewards, etc.;

2. The ISP fails to delete, block, disconnect or take other necessary measures, or provides technological support or other means of aid when it knows or should know of activity that infringes another’s network dissemination of information right.

3. If an ISP provides advertisements for a specific copyrighted work, performance or radio and video recording and thereby gains profit, or gains other economic benefits specifically related to the work, performance, or radio and video recording as provided by the ISP, and the ISP charges a standard advertising or service fee for its provision of the network service, it shall not be deemed to be at fault;

4. An ISP has not deleted, blocked, disconnected or taken other necessary measures after receiving notices sent by the rights holders through regular post, fax or emails, etc.;

Although the above regulations only focus on the ISP for those users providing copyrighted content, it may also be applied to other ISPs, like the provider of  a network link service. This means that in some cases fault must be determined based on the lack of active examination despite an obligation to do so, a combination of various methods of network services provided, the type of content infringed, and the specific features of the ISP in question.

IV. The regulations on “should have known” exhibit a higher legislative standard

The Network Interpretations have created detailed articles to assist in the court’s determination of whether an ISP shall be considered to have known of its users infringing conduct, infringing upon the network dissemination of information rights of others:

1. Based on the particular characteristics of the ISP, its methods of operation and the likelihood that infringing activity will occur:

2. The type and popularity of the communicated work, performance and radio and video recording and degree of obviousness in determining infringement;

3. Whether the ISP has actively chosen, edited, modified or recommended the work, performance or radio and video recording;

4. Whether ISP has actively taken measures to prevent infringement;

5. Whether ISP has implemented a convenient process to receive infringement notices, and whether it has made timely responses to said infringement notices;

6. Whether ISP has taken proper measures against repeat infringers;

7. Other relevant factors.

For the same, the above regulation only applies to ISPs where its users provide the infringing content. As for other ISPs, we believe they may still be referred to.

V. Independent regulations for infringement caused by video uploading websites

The Network Interpretations have also made independent regulations concerning the “shall be known” standard when applied to video uploading websites, where the most serious forms of infringement often occur:

1. Where the ISP has recommended popular videos through the creation of a list, catalogue, reference, description paragraph, brief description or other method when providing its network service, and allows the public to download, browse, or otherwise obtain the copyrighted video in other direct ways;

2. Placing popular films and video works on a main page or other location where the ISP would obviously know of its existence;

3. Where the ISP chooses, edits, arranges, provides recommendations based on genre or theme or content of a popular film or video work, or otherwise provides a ranking system for said copyrighted films and video works;

4. Other situations in which the ISP would clearly be aware that the copyrighted work, performance, or radio and video works are being provided without license, and no reasonable measures have been taken to curb such infringing activity;

VI. Change of judicial jurisdiction

Pursuant to the regulations in Civil Procedure Law and the original network copyright interpretations, these three doctrines shall be followed in determining the jurisdiction of Internet infringement cases: 1. Jurisdiction shall be determined according to the defendant’s residence or location; 2. Jurisdiction shall be determined according to the location of the server hosting the infringing website; 3. When it is difficult to determine the place of infringement or the defendant’s residence, the court shall have jurisdiction where the plaintiff’s terminal by which it detected the infringing activity is located.

In practice, we have seen a number of situations where infringers have located their servers outside of China in order to evade China’s legal jurisdiction. The Network Interpretations have thusly been adjusted to regulate such activity. In making use of the amended articles in addition to giving the courts the ability to find jurisdiction based on the location of the plaintiff’s terminal where the residence of the defendant or location of the infringing activity is either unknown or outside of Chinese jurisdiction, Chinese courts now have greater ability to hear and adjudicate disputes arising out of network and Internet infringement cases.

Lawyer Contacts

You Yunting：86-21-52134918  youyunting@debund.com/yytbest@gmail.com

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