Posted on 04/24/2009 1:02:59 AM PDT by TigerLikesRooster
China to put squeeze on foreign firms / IT companies must reveal product secrets
The Yomiuri Shimbun
The Chinese government has decided to launch a system next month to force foreign manufacturers of digital household appliances and other items equipped with computing devices to disclose key information, The Yomiuri Shimbun learned Thursday.
The move is aimed at controlling the makers' products when their goods are made or sold in China.
Beijing likely has informed Tokyo and Washington that detailed provisions to enforce the system will be announced by the end of this month. The Chinese government likely will give manufacturers a grace period before implementing the system, but the new rules will be enforced after this period ends.
After the plan to introduce the system was reported, Japan, European countries and the United States urged the Chinese government to abandon the idea because it would make it easier for foreign companies' intellectual property to be passed on to Chinese competitors. Critics say Beijing's decision to launch the system despite opposition from other countries likely will cause an international problem.
The system will require foreign companies to disclose the source code for their products in a bid to rein in their information technology products made or sold in China.
Under the planned system, a Chinese government official would visit companies in Japan to check products.
If a company refuses to have its products inspected, those products will not be allowed to be manufactured or sold in China. No developed nation has this kind of system.
(Excerpt) Read more at yomiuri.co.jp ...
Hmmmm... copyright...pffft up in smoke
The Chinese are getting lazy, they used to just steal the secrets via the H1Bs.
They outsourced to cut their costs and now they wonder why it’s about to cost them more? India will shortly follow suit either by demanding the same things and/or charging more for their services. Corporate weasels rarely look at or consider the real risks involved in doing business with or worse moving critical activities and operations to these countries. Once they know they have you snagged they are obviously going to reel you in.
Yes it does matter in fact...your are delusional; China is spending money on weapons. China always owns 51 % of any business in China. For heavens sake, it’s a communist country...In China a GM plant went down in December as they always do...came back in January to find every piece of equipment gone...guess what the Chinese own it now...they had to buy new equipment...have to build cars in China to sell there...just as Korea who tried to play the same little trade games with China that they do with us found out...got their butts tossed out of China asap.
It wasn't any great sweeps of history that made them open brand new plants over in China when the US could have used them desperately.
They saw two things that blinded the to all else. They saw a virtually unlimited market while ignoring that the govt controlled access to that market, and they saw simple $$$ in their eyes through the production gains they could get for their bottom lines having slave labor assembling their products.
Most of us here on FR knew they'd run across these kinds of problems. After all, they have no rights to private property, no rights to defend themselves from the right to trade secret. Right up to the point that the ChiCom govt could out and out steal their factories by nationalizing them. China is a land without indiviual property rights.
It's a land where they have little respect to their own laws as written, able to skirt the law when the law is too inconvenient. It's a land where the police protect the interests of the State, not the individual.
American and other foreign nationals knew these things to start with. They simply chose to ignore the in the forelorn hope that they'd be able to the products to market before the he heavy fist of govt fell on them.
Deperate hope and not realistic.
You've missed the point. It doesn't matter that you can predict these kinds of problems would occur. In the short run, if you don't go overseas, your out of business anyway.
If you make widgets and your labor cost is $15/hr. And your competitor goes overseas and his labor cost is $1/day. You aren't going to have to worry about the Chinese stealing your production process. You'll be bankrupt long before the Chinese get around to stealing your competitor's process.
In the short run, your competitor made money and you didn't. And that's all that counts. You're competitor won and he maximized his profits given the rules of the game.
But it's government's role to define the rules of the game. And if you don't want one of your competitors going overseas and putting you out of business, then government has to step up to the plate and define the rules so that none of your competitors can't go overseas. Otherwise you might as well be the first and make the short run profits.
If China steals the technology now, is it going to help the firms that refused to go overseas? No. They are out of business.
It's the same argument with hiring illegal aliens. If the government won't enforce the law against your competitors, then whoever hires the illegals first and lowers their costs and makes the profits wins. Otherwise, you go bankrupt with the moral knowledge that you obeyed the law.
No fooling - the sarcasm of my statement obviously went right by you. I am constantly amazed at the technical brainiacs that BRAG about the intellectual engagement with and sharing of basic research with the Chinese government of information and data that has obvious military application.
For years, one of the most honored ‘scientists’ in the NY research center has been an outspokenly pro-Castro Cuban brought over to the US in his early teens by parents that were fleeing Communism.This guy was an advisor to Clinton’s Science & Technology panel.
I believe that one of the real downsides to globalization is the sharing of technology that has military uses...I agree with you. As for sarcasm, I sometime don’t get it...sorry!
You miss one point...there are worse things the losing business...like a war with China after we have given them our technology...the American businesses should not have been put out of business by globalization. It was never in our best interest to buy into this nonsense...never.
China owns Taiwan. They have only the economic freedom that China allows thus, this won’t save them.
It is not in the country's best interest, no. But it is in the best interest of an individual firm. In fact it is in the survival interest of an individual firm, that hopes to be put out of business later rather than sooner. And that is why government should have redefine the rules to limit the sale and transfer of technologies to China, instead of putting China on the most favored nations list.
I agree completely with you...also business should not have been put into a position where they had to choose survival or selling out your country-awful.
I have spent lots of time in Taiwan, working with manufacturers there. I call "Bravo Sierra!" on your statements.
What will we do to stop anything China wants to do with Taiwan? We owe China so much money...if I lived in Taiwan, I would move and soon.
Agreed!
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