Honey Laundering, Or How Chinese Lead And Indian Antibiotics Become Indian "Honey"

IP Dragon Weekend Edition

蜜蜂 (Mandarin mi4 feng1 Cantonese mat6 fung1) 

= honey bee  

蜂蜜 (Mandarin feng1 mi4 Cantonese fung1 mat6) 

= bee honey 

Two time Pulitzer-prize winning reporter for investigative journalism, Andrew Schneider wrote an interesting article about Chinese honey that is imported to the U.S. via India, Vietnam, Malaysia, Australia (and for some time Russia) that contains dangerous antibiotics and/or lead. The Chinese honey is imported via other countries into the U.S., since 2001. That was the year that the U.S Commerce Department imposed a tariff to prevent Chinese companies to dump cheap products on the American market.

Schneider: "Almost 60 percent of what was imported - 123 million pounds - came from Asian countries - traditional laundering points for Chinese honey. This included 45 million pounds from India alone." And India does not even have the capacity (the amount of bees) to produce 45 million pounds of honey.

Antibiotics

The only Indian part in the "honey" might be the dangerous Indian antibiotics. Chinese beekeepers fought an epidemic of foulbrood disease with antibiotics, which includes chloramphenicol from India, which can damage DNA and be carcinogenic, and can lead in about one out of 30,000 people to a fatal reaction. 

Lead

Some honey vendors use lead-soldered drums to collect and store the honey before it is collected by the brokers for processing. This can lead to lead contamination.

Sometimes no trace of honey

Schneider writes: "Another favorite con among Chinese brokers was to mix sugar water, malt sweeteners, corn or rice syrup, jaggery, barley malt sweetener or other additives with a bit of actual honey. In recent years, many shippers have eliminated the honey completely and just use thickened, colored, natural or chemical sweeteners labeled as honey." 

Read Schneider's article that reads like a Crime Scene Investigation. He writes that the Food and Drug Administration is unable to effectively the origin of the honey and its safety, about two institutions that can test the pollen, about the cat-and-mouse game of testing and ultra-filtration that removes or conceals floral fingerprints (pollen) and sweeteners or contaminants, and the lack of a definition of what honey is. Read Schneider's article for Food Safety News here.

Characters explained:

蜂 left part of character means "insect", right part means "meets in groups", 

as bees tend to do.

蜜 top part is "roof", middle part is "necessary", lower part is "insect". The top part and middle part combined is "silence". Not sure whether bees are silent or whether they keep buzzing in their hive. 

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Sobering Statistics Put China's Innovation Into Perspective

In the graphical perspective,
things become smaller if the distance
from the observer increases

Professor Anil Gupta and Haiyan Wang, writers of the book 'Getting China and India right', put China's innovation statistics into perspective.

Patent filings in 2008

• U.S.A. 400,769 filings
• Japan 502,054 filings
• China 203,481 filings

Gupta and Wang have a point when they argue that the Chinese inventions patented outside China are a more objective measure than the ones registered by State Intellectual Property Office (SIPO).
The most compelling statistic is the number for triadic patents or triadic patent families (patents that origin from one country but that are patented by the European Patent Office, United States Patent and Trademark Office and the Japan Patent Office).

Triadic patent families according to Organization for Economic Cooperation and Development (OECD) in 2008

• Europe 14,525 filings
• U.S.A. 14,399 filings
• Japan 13,446 filings
• China 473 filings

See the Compendium on Patent Statistics for 2008 here (pdf) on page 6. 

However, I would argue that these patent filings are not the best measure. Patent registrations would be a far more better indication of patent quality. 

Professor Gupta and Mr Wang wrote: in 2010 China accounted for

• 20% of the world's population
• 9% of the world's GDP
• 12% of the world's R&D expenditure
• 1% of the patent filings with or patents granted by any of the leading patent offices outside China. 
• 50 % of the China-origin patents were granted to subsidiaries of foreign multinationals   

Professor Gupta's and Mr Wang's Wall Street Journal article 'China's Innovation Is A Paper Tiger' can be read here and should not be confused with the title of my thesis 'Paper Tiger Or Roaring Dragon, China's TRIPs Implementations and Enforcement'.

UPDATE August 2, 2011: 
Joff Wild, editor of Intellectual Asset Management gives an update since 2008. In short: the growth in the number of China's triadic patent filings/grants paints a rosy picture. However China's innovation prospect is much bleaker. On this I concur with Mr Wild. Read more about the relation between innovation and intellectual property and innovation and censorship here.

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Why China Is Preferred Over India By The U.S. Pharmaceutical Industry

10 articles to go: IP Dragon on its way to its 1000th article

Joseph Alexander wrote for Pharmabiz.com that the Pharmaceutical Research and Manufacturers of Amercia (PhRMA) choose for the China Pharmaceutical Industry Research and Development Association (SINO-PhIRDA) to cooperate and continue a regular dialogue.

Why PhRMA did not choose to sign a cooperation agreement with its Indian equivalent?

• India's 2005 Patent Law does not recognize incremental pharmaceutical innovations patentable (see prakruthip's Spicy IP article: 'The USIBC Report On Incremental Innovation: An Analysis';
• Weak regulatory data protection provisions (see Prashant Reddy's Spicy IP article: Article 300A of the Constitution: A constitutional right to 'data exclusivity'?

Read Mr Alexander's article here.

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Incremental Pharmaceutical Inventions in China and India: "No Need to Reinvent the Wheel"

For those who missed it, in 2008, the Intellectual Property Association of Japan (IPAJ) published an interesting article by Parama Sinha Palit and Bhaskar Bhattacharya called 'Does Intellectual Property Laws in India and China Encourage Innovation'. Messrs Palit and Bhattacharya, both senior associate with Corporate Law Group are advocates of the patentability of incremental, cumulative or adaptive pharmaceutical inventions. They opine that China is doing a much better job than India in this respect. India seems to discourage incremental inventions, while China has utility (model)-patents for these kind of inventions.

"It has been rightly pointed out that not recognizing incremental innovation in the pharmaceutical industry is like asking medical researchers to reinvent the wheel."

Read their IPAJ article here.

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Indian High Court Claims Jurisdiction Against Chinese Cybersquatter of ICICIGROUP.COM

Malathi Nayak of Livemint has a very interesting article about who has the jurisdiction over Chinese entities if they infringe intellectual property rights via the internet. In this case a Chinese entity had registered the domain name icicigroup.com which is similar to icicibank.com.

First the icicibank tried to get control over the domain name by filing a complaint with the WIPO’s Arbitration and Mediation Center (AMC) using the Uniform Domain Name Dispute Resolution Policy. To no avail.

Malathi Nayak wrote:

"In December, justice Sanjiv Khanna [of India's High Court, IP Dragon] passed an order restraining a resident of Beijing, Chuandong Xu, and a Chinese website registrar, HiChina Web Solutions Ltd, from using or selling the site ICICIGROUP.COM.
The order was passed ex parte or in the absence of the defendant. The same court had heard a 2007 case, in which India TV Independent News Service Pvt. Ltd sued US-based India Broadcast Live Llc. over thewww.indiatvlive.com domain name. In October, it dismissed India TV’s suit and allowed India Broadcast Live to use the name.
The two cases mark a trend where Indian courts are ruling on cybersquatting cases involving people and firms from different geographies—not all of which may fall under their jurisdiction."

The enforceability of such cross-border rulings are in general doubtful. However, Saikrishna Rajagopal, partner at Saikrishna and Associates, who filed the suit for ICICI bank, said that the Chinese defendants have complied with the high court order.

Read more Malathi Nayak's article here.

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US Customs Seizure Statistics 2008: "China number one, India number two and Hong Kong number three counterfeit producer"

The U.S. Customs and Border Protection and Immigration and U.S. Customs Enforcement divisions of Homeland Security gives some statistics about the numbers, characteristics and origins of counterfeit goods seized in the U.S. in 2008.
IPR seizures of goods from China rose 40 % by value in 2008. Footwear from China accounts for almost 96% of all IPR infringing footwear. "In 2008, China, India, and Hong Kong, the top three trading partners for IPR seizures overall, accounted for 94% of all IPR seizures of products posing potential safety or security risks." Read more about on the CBP.gov site here.

IPR seizures counterfeit products originating from:

• 1. China $ 221.7 million (81 %);
• 2. India $ 16.2 million (6 %);
• 3. Hong Kong $ 13.4 million (5 %);
• 4. Taiwan $ 2.6 million (1 %);
• 5. South Korea $1 million (<1%).

Read more statistics here.

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