Beware: That Russian Air Superiority Fighter You Just Bought Might Be An Improved Chinese Knockoff

Pravda, a "Russian semi-propaganda newspaper," recently reported that Russia [is] infuriated with Chinese export copies of Su-27 jet fighters (h/t commenter at Marginal Revolution). The Sukhoi Su-27 fighter, and its numerous variants, is Russia's most advanced jet fighter in service with the Su-27SM being the most advanced. Back in 1991, Russia sold China 24 Su-27s for approximately $1 billion. A second delivery of 24 Su-27s was made in 1996, and the total deal is worth about $1.7 billion. In the same year Russians and Chinese agreed to a $2.2 billion licensing agreement allowing the Chinese to produce up to 200 Su-27s, to be called the J-11. The license rights did not include export rights to foreign countries. Russia already had a healthy Su-27 export business with customers in Vietnam, India, and Indonesia. The Chinese license agreement, and sales of the Su-27 is an important revenue source for Russia's military which is using the profit to finance the development of their next generation jet fighter, the Su-37. (Almost all of this data was sourced from FAS's pages. FAS was founded by scientists who worked on the Manhattan Project and were wracked with guilt following the atomic bombing of Hiroshima and Nagasaki. Their mission is combating nuclear proliferation and the small arms trade, and world peace in general)

Now, the Russians are accusing the Chinese of manufacturing Su-27s with an intent to export the jets in violation of the licensing agreements. Pravda reports that "Moscow promised to launch legal proceedings to protect its intellectual property." This will probably have to be a legal proceeding based on violation of international law or breach of contract in selling to third parties. It is highly unlikely that there are any patent or trade secret claims. A patent claim would require that the Chinese misappropriated patented technology. Sophisticated military hardware often avoids patents because that requires disclosure. Also, competition for military contracts operates differently than the free market making patents less purposeful. A trade secret claim is unlikely because the Chinese already have the trade secret and would not be divulging it by selling the jets to a third-party. This would just give the third-party the opportunity to reverse engineer the jets. This also makes it less likely that the jets would be patented in Russia.

Selling jets involves more than just the delivery of a plane. There are also the training costs, maintenance costs, and upgrade costs. Russia might be worrying less about its IP, as its sales record demonstrates that it is willing to sell to anybody who can afford their jets, and more about the income from all of the services that go along with selling jets.

Further Reading:
Russia upset by China's imitation fighter
China copies obsolete Russian fighter

Intellectual Property Law in Asia Symposium

Recently, I was appointed Senior Associate Editor of the San Diego International Law Journal. The outgoing editorial board tasked us with organizing a symposium issue for next year. A symposium issue of a law journal is an issue devoted to a single topic. The publication is often preceded by 3-6 months with a conference at which several of the authors present and critique each other's papers. Our plan is to have a conference in Spring of 2009, and the release of the issue in Fall of 2009. The challenge now is finding authors to submit papers for inclusion in the issue and at the conference.

Our topic is Intellectual Property Law in Asia, with a focus on China. There will be one article each on Chinese patent, copyright, trademark, trade secret, and licensing law. Also, there will be articles on IP issues from various East Asian countries such as Indonesia, Vietnam, Japan, Korea, and India, or any other countries in the region that we can find scholars on. There will be a couple of new laws on China IP soon, and little scholarly work has been done on the laws of several countries in the region. We are very excited to further the legal scholarship in these fields.

If you know anybody who specializes in these areas and would like to write a scholarly article, please contact me at WD.Lewis@gmail.com. If you know somebody who knows somebody that knows these areas, I'd still be thrilled to hear from you.

Thanks goes to Anna Han for the IP in China suggestion, and thanks goes to Dan Harris of China Law Blog for suggesting expanding the focus to cover other parts of Asia.

Posts of the Week: 4/21 - 4/27

China's Two Markets at Managing the Dragon
Jack Perkowski explains the two market system in China where foreigners compete with locals, and locals and compete with locals. He concludes that the strongest competitors to foreign companies are arising out of the crucible of the intense competition in the local markets.

CNN sued for Cafferty's "goons and thugs" comment at Chinese Law Prof Blog
Donald Clarke examines the merits of the case against CNN.

how to protect your IPR via supply chain security at China Esquire
Tom Chow reviews an article on supply chain security and how it can protect your IPR.

Three Cheers for Commenter BruceM at The Volokh Conspiracy
I guess commenting at blogs can be a worthwhile experience...


Is it tacky to add my own posts at the bottom? Maybe... And, let me know if it is! I promise not to list all of my posts from the past week, and I won't put them in bold.

The Growth of Chinese Brands, plus the comments
China Choice of Law in 2003
Why Fix What Ain't Broke? The Shanghai Market

The National Geographic China Special Issue

The other week I posted that I'd comment on one of the articles from National Geographic's Special Issue on China, Inside the Dragon. There isn't much to comment on. The articles are about drawing personal connections between the reader and China's citizens. This should do more to quiet American fears of China than just about anything else.

Today, I checked out the magazine edition of the magazine and flipped through it. The magazine edition is truly beautiful. The layout is masterful with photos and artwork displayed throughout. There is not even an advertisement from the first full story until the last 5 pages. The editors did a fine job displaying the beauty, diversity, humanity, and, even, the flaws of China. Impressive.

Why Fix What Ain't Broke? The Shanghai Market

A couple of Financial Times articles today got me thinking about the Shanghai Composite Index, Bubble Trouble and Shanghai shares soar as tax cut takes effect.

Way back in May of '07 Beijing took action to try and cool the market by introducing a stamp tax on trades. Despite the tax, the Shanghai Index remained one of the best performing markets in the world with prices increasing 141% from February 2007 to October 2007. At the peak on October 16, the average price/earnings ratio was at over 50x. By Tuesday, April 22, 2008, the Shanghai Index had fallen 51.2% to a 13-month low. But, P/E was at a less volatile and much more reasonable, and still a little bubbly 20. Something had cooled down the market. Probably the state of the global financial markets and overspeculation in worthless assets, but regardless the market was cooled to stable level. Why would Beijing intervene to jack the market up if it is operating more like (but still considerably dissimilar to) a normal market?

The FT articles speculate that the reduction of the stamp tax sparking a 9.3% jump in the Shanghai Index "betrayed an unwarranted nervousness about market movements." Long-term investors have no problem posting gains, but small investors are hurt considerably from declines in the market and the government is stepping to help them. Also, the articles speculate that "with the Olympics approaching, Beijing would prefer the stock market to be rising again as it showcases the results of its rapid economic development." A strong market is a nice indicator of a strong economy despite one of the articles noting that the performance of the Shanghai market has little impact on the "real economy" of China.

The "Bubble Trouble" article ends with the following wisdom:

[I]ntervention [by Beijing] will merely ensure that volatility remains a feature of the Chinese equity markets. Investors will revert to basing decisions not on the underlying value of the shares they want to buy or sell but on their guesses about the intentions of the Chinese government. Perhaps they were right all along about the destructive embrace of the state, the stock markets and the Olympics.

Also, see Michael Pettis's insightful posts on this subject for some in depth and original analysis:
Stock market rises 9.3%
Stock market is down today

Must There Be a First Time for Everything?

[Finals time is here, post frequency & depth might decline...]

The Economist.com has a new article up discussing the fallout over firm's image and advertising dollars in connection with Darfur and the Beijing Olympics, Beyond the “genocide Olympics”. This article has generated more comments at the Economist than any article I've seen over there. Here is the central paragraph:

Coca-Cola is doing some good things in Darfur, from providing immediate relief on the ground to meeting “stakeholders” to try to figure out solutions to the crisis. But is this enough to buy Coca-Cola the right to remain silent in public about China? As Mr Isdell puts it, “rather than make public statements, we have chosen a more direct and, in our view, more effective route to help address the staggering human suffering in Darfur.” Not good enough, retorts Human Rights Watch, along with other campaigning NGOs.

The article reports that when the UN Human Rights Council convenes in June:

it will be the first time that the UN human-rights machinery has taken a substantive position on companies’ responsibilities. Mr Ruggie hopes for greater clarity over the duties of firms and governments, and a better balance between protecting the legitimate interests of investors with the needs of host states to discharge their human-rights obligations.

Ugh... What place does a bloated bureaucracy have in drawing up substantive standards on the way business should operate? Isn't this supposed to be the job of the market place and tort law suits? If companies want to speak out against China and the way it operates in Darfur then they'll alienate their Chinese customers and appease their Western customers. Keeping mum will have the opposite effect. Coca-Cola seems to be doing an admirable job in striking a reasonable balance, and at least they're taking action in Sudan rather than just offering verbal condemnation. It is of course crucial that there is a free press to allow the market to see what these companies are doing and the manner in which they operate, but it should not be the UN's job to regulate MNC's human rights.

In the final paragraph of the article they quote Sir Mark Moody-Stuart, chairman of Anglo American, who says that Chinese companies are "slowly becoming more sensitive to human rights," and that they understand and are taking seriously the government's call of the development of a "harmonious society."

I guess we'll just have to wait and see if the billion dollars in Olympics advertising pays off...

China Choice of Law in 2003

There's an interesting article in the most recent edition of the Chinese Journal of International Law (7 Chinese J. Int'l L. 227 if you want to bring it up in WestLaw or LexisNexis) covering several subjects on Chinese judicial practice in 2003. The subjects covered include a statistical analysis of 50 civil and commercial cases from 2003, renvoi, inter-temporal conflict of laws, jurisdictional competition between judicial settlement of disputes and arbitration, and the recognition and enforcement of foreign judgments and arbitral awards. The article is by Huang Jin, Director of Wuhan University Institute of International Law, and Du Huanfang, and is entitled Chinese Judicial Practice in Private International Law: 2003.

I would like to focus on the case survey in the first part of the paper and provide an alternative statistical analysis of the choice of law data collected. The data consists of 50 cases in 2003, all of which are available in the Chinese Gazette of Supreme People's Court (2003-2004) or the SPC's website. The cases come from several different courts across China. The authors included the named parties and cause of action, the countries or regions involved (including 8 cases involving only Chinese parties), the law of the country that the court chose to apply, and the method by which the court chose which country's law to apply to the dispute.

To analyze the choice of law application differently than the authors, I decided to eliminate the 8 cases involving only Chinese parties and the 1 case between foreign parties, leaving 41 cases in the data set because the choice of law analysis is more interesting and useful when there is an actual conflict of laws. In 8 of the 41 cases between a foreign party and a Chinese party the judge gave no reason or method for choosing what the applicable law the court would apply in a conflict of laws, and in each of those 8 cases the judge applied the law of the People's Republic of China. The authors do not discuss this point at all, but, assuming that these cases are representative of the Chinese judicial system, this means that in ~19.5% of all civil and commercial cases tried in China the judges decide the critical conflict of law issue without even saying why or how they are arriving at the conclusion. And, even more suspect, they each arrived at the conclusion to apply Chinese law. I investigated the courts that these decisions came from 7 of the 8 are from different courts meaning that there is no one court that is, seemingly, arbitrarily choosing to apply Chinese law to a conflict of law problem.

Hopefully there has been improvement in this area since 2003. The relevant law in litigation can be as important as the facts of the case themselves, because if the relevant law does not find something illegal then there is nothing to be litigated. 19.5% is an unacceptably high level of cases for judges to not be explaining why they have chosen a set of laws that govern the dispute when the relevant law is so important to the outcome of the suit. Under U.S. law it is mandatory to include in your claim why the court has jurisdiction and it is hard to imagine a claim being sufficient without saying what the applicable nation or state's law is.

Fortunately, in the world of Chinese jurisprudence 2003 is a long LONG time ago.

The Growth of Chinese Brands

Today the Financial Times had a special report on Global Brands 2008. The heart of the report is the valuation and ranking of the world's top 100 brands, the valuation and ranking of the top 10 brands in 16 sectors, and the valuation and ranking of the top 10 brands by geographic or political region.

To value the brands, FT relied on the brand strategy and financial consultant Millward Brown Optimor. Of the over 50,000 brands in the WPP database, MB Optimor "prepare[d] financial models for each brand that link brand perceptions to company revenues, cash flows, and ultimately shareholder and brand value." This resulted in a brand rankings based on a dollar value which represents "the sum of all future earnings that that brand is expected to generate, discounted to a present day value."

Of the top 10 brands in the world, only two are non-American: Nokia and China Mobile. And China Mobile weighs in at the number 5 position, ahead of IBM, Apple, McDonald's, Nokia and Marlboro. Google, GE, Microsoft, and Coca-Cola round out the top 4 positions. This puts China Mobile in good company. But it is company that China Mobile is used to, as they retain the same brand ranking as last year. Interestingly, it is the only non-financial Chinese brand to make it in the top 100.

The only other three Chinese brands in the world's top 100 brands are ICBCat 18, China Construction Bank at 31, and Bank of China at 32, all financial brands. These three brands also rank at positions 3, 6, and 7, respectively, in the top 10 financial brands. Two questions might come to mind. First, why are Chinese banks ranked so high? FT writes that "Chinese banks have had two big years but it is hard to tell how much of their performance is due to better management and how much to the exceptionally favorable economic conditions." I see, they are ranked so high because they've made a ton of revenue and/or cash in the past couple of years but depending on how management has improved this increase in brand ranking is tenuous. Second, one might ask, why are the Chinese banks ranked so low? FT writes that MB Optimor actually adjusted the value of the Chinese banks down to account for the "Shanghai bubble" on the the stock market. Had they not accounted for the alleged bubble, the banks overall brand value would have been even higher. Maybe BofA should rethink not exercising all of their options?

The only other sector where a Chinese company made a splash was in motor fuel with Petrochinacoming in at number 5.

Why don't other Chinese brands make an appearance in the top 100? I would surmise that China's financial institution brands are so strong because they have made a lot of money very publicly over the past couple of years. China Mobile is so strong because they're pretty much the only mobile game in China. We have not seen the entrance of other Chinese brands into the top 100 brands because Chinese brands have yet to make a serious entrance into the worldwide marketplace, despite any dominance they might have in China's in domestic market. This summer the world's cameras will be on China, and China's star companies will have the opportunity to showcase their brands. It might not happen immediately, but I'd look for more Chinese brands to jump into the top 100 as early as the 2010 list and as late as the 2011 list. If I had to guess, I'd look for Chery or Lenovo to be the first non-financial, non-China Mobile Chinese brand to break into the top 100 brands.

Posts of the Week: 4/14 - 4/20

In the interest of possibly drawing more Chinese visitors to the site, I'm expanding the title to include a Chinese idiom that roughly expresses the same idea as the current title. 不经一事，不长一智. Still, I'm not implying that I have much experience or wisdom. Rather, I am on a quest for experience to develop the wisdom.

What can you do about late shipping? at Silk Road International
How to fix some of those pesky shipping problems when sourcing from China.

Chinese Joint Ventures -- The Information The Chinese Government Does Not Want You To Know at China Law Blog
Wow! The JV low-down from on high.

Shipping Questions at Silk Road International
Some interesting answers to questions on sourcing from China. Plus, see commmentary from CLB, including the comments.

The Law and New Tech in China at China Hearsay
Stan Abrams discusses the difficulty of explaining legal risks to foreign companies that wish to sell nano-widgets in China when the Ministry of Mysterious Technology lacks a formal policy. Plus, commentary by CLB: write a CYA letter.

More evidence of increasing risks at China financial markets
Michael Pettis warns that the large amount of hot money flowing into China may be contributing to increased costs across the boards, and the "rigidities and excesses in corporate activity and balance sheets" during booming periods is often exposed for worse and exacerbates economic downturns.

america and the eu “team up” on chinese toy safety at China Esquire
Thomas Chow wonders what effect if any, EU and US persuasions will have on Chinese toy safety.

'Informal' Clinton China Adviser says Goobye to Campaign 08 at TIME: China Blog
Sigh... Despite and because of Hilary Clinton's hawkish stance on China trade a pragmatic adviser has fled the Clinton Camp.

Summary Judgment/Procedure in China at China Business Law Blog
Where else in the English speaking world can you find blog posts investigating the possibility of summary judgment in Chinese litigation? Nowhere else.

Energy Conservation Law (Industrial, Commercial, and Residential Construction) at China Environmental Law
Charlie McElwee evaluates the law to figure out what "fixed asset investment" projects are now subject to.

"If Chewbacca lives on Endor, you must acquit!" at Boulder2Beijing
If you use examples from South Park to explain China, I will post a link to you in the Posts of the Week. I'm not sure the post made sense because each of those things do make sense (you yell at people for almost hurting your kids regardless of who is at fault; sometimes it is easier to read than 听得懂, especially in China where nobody necessarily speaks the same dialect but the literate can read; back in the Dark Ages of California I don't recall being able to smell the cigarette smoke in the non-smoking sections of restaurants), but I just really like South Park.

Two Worlds - One Place at Montagna Vita
College friend Alex Mondau is back at work at an orphanage in Nepal. The orphanage is supported by The Great Adventure Treks and Expeditions, a tourism service for the Himalayas. Not China, though his plans were almost disrupted by the stuff in the region.

Electrifying Automotive News

The other day I was involved in a cross country dispute with a friend at Georgetown Law, Michael Rothstein. He said that electric cars (he actually thinks Tesla's are too impractical because of both cost and limited size, but who wants to get linked to a defunct EV-1 website?) should be the future of the auto industry because as energy production (hopefully) gets rapidly cleaner green house gas emissions would nose dive with the combined decline of dirty energy production and elimination of petroleum burning transportation. My problem was that when you're powering an automobile with electricity then you're stuck with dual layers of inefficiency: electrical generation inefficiencies and automotive use inefficiencies. In addition, there would be no rapid GHG reduction around the world because clean generation technologies are still rare and expensive, and there might even be a net increase in GHG emissions as developing nations pick up the increased burden on the grid from a shift to electrical transportation by building even more coal-fired plants. My solution: throw lots of money into a next generation technology: the hydrogen fuel cell, and a process to efficiently generate hydrogen. Of course this throws in a third layer of inefficiency in generating hydrogen, and generating hydrogen efficiently might not even be possible... So basically, the hydrogen economy probably won't become practical until someone figures out fusion power. But when someone does, the whole world would be able to implement clean transportation. Of course when someone invents fusion power the world's energy problems will probably become moot anyways. Does it bother me that my argument rests on the development of possibly impossible developments? Yes.

Well, Michael can stick a feather in his cap as BYD Auto recently announced that they're releasing a new all electric automobile in 2009 or 2010, and they would like to eventually bring the car to the US market. The WSJ reported an expected price of RMB 200,000. One of the main problems holding electric cars back has been their batteries, either capacity or tendency to explode. Back in January, I commented on an Economist article which brought attention to BYD as having "Global leadership in a narrow product category," batteries. They claim that their technology overcomes both hurdles. When a world leader in batteries is getting into the electric car business they must either have a killer product, or an overly ambitious business plan.

Michael has convinced me that the electric car combined with cleaner energy generation is the preferable intermediary technology between today and some future utopia full of cheap easy electricity and cars that leave behind a trail of water. I hope BYD succeeds in its venture. If so, expect these numbers to skyrocket.

National Geographic on China

National Geographic's May '08 issue is dedicated to all things China (h/t The Daily Dish). The articles appear to free online, at least for now. The issue covers a lot of ground including the middle class, water, the Olympics, the past, and the future. The coverage might be a little Tibet heavy (and here and here), but what else can you expect from NatGeo?

I haven't had the time to read the stories, but I'll try and review one when I have the time. I have had time to observe what NatGeo does best: bringing out the beauty, both natural and man-made of the places their photographers visit. There are some impressive photo sections from this issue, including aerials and a collection of desktop photographs from this issue. Also, they asked reader's to send in their own photos of China and they collected them in an online interactive map. Very cool!

Towards Nonpolarity

In yesterday's Financial Times there was an excerpt from a paper by Richard Haass, President of the Council on Foreign Relations. After reading the excerpt I was so intrigued that I had to read the whole paper at Foreign Affairs, The Age of Nonpolarity: What Will Follow U.S. Dominance [available for free]. Mr. Haass argues that in the 21st century we will not see the multipolar world of the Cold War, or unipolar U.S. dominated world of the past 20 years, but "a world dominated ... by dozens of actors possessing and exercising various kinds of power. This represents a tectonic shift form the past."

Throughout history there has always been one power in control, or two or more powerful states at loggerheads with each other. When there has been only one power, another has inevitably risen as a rival. Mr. Haass gives several reasons why a rival has not emerged to challenge the U.S. and why a rival or set of rivals is unlikely to emerge:

• According to Mr. Haass, the most important reason, is that despite Iraq and Afghanistan and George W. Bush, the U.S. "has not, for the most part, acted in a manner that has led other states to conclude that the United States constitutes a threat to their vital national interests."
• "[T]he disparity between the power of the United States and that of any potential rivals is too great."
• Our military power and size is so vast that it "will long remain the largest single aggregation of power."
• Though other countries, China and India in particular, GDPs may become comparable to or even surpass that of the U.S., their wealth will need to be spent on "providing for the country's enormous populations and will not be available to fund military development or external undertakings."
• "The other major powers are dependent on the international system for their economic welfare and political stability," and to challenge the U.S. as a great-power rival would seriously disrupt the international system.
  

These are all solid observations that I strongly agree with, especially the final one. In the post-WWII world it is hard to see any potential rival to the U.S. willing or able to disrupt the international system. In conjunction with the second one, the U.S. military, particularly its Navy, is so powerful that if there was a disruption of the international system only the U.S. Navy could guarantee the vital imports and exports to wage any sort of conflict.

But, just because the U.S. is incredibly rich and powerful, and will remain so for quite a long time, does not mean that it will be able to dominate the world for much longer. Mr. Haas gives three reasons for the demise of the current unipolar world:

• Historical
• As states develop they become more efficient and stronger which results in more states with the ability to "exert influence regionally or globally."
• U.S. Policy
• U.S. energy policy, focused around petroleum products, has turned oil and gas producers into "major power centers."
• U.S. economic policy has placed "downward pressure on the dollar, stimulate[d] inflation, and contribute[d] to the accumulation of wealth and power elsewhere in the world."
  
• The war in Iraq has demonstrated that the U.S. is
  imperially overstretched.
• "Globalization has increased the volume, velocity, and importance of cross-border flows of just about everything."
• "[C]ross-border flows take place outside the control of governments and without their knowledge... [which] dilutes the influence of major powers."
• "[T]hese same flows strengthen the capacities of nonstate actors such as energy exporters..., terrorists..., and Fortune 500 firms."

I agree most strongly with the first and third of these reasons for the demise of the U.S. as a unipolar power. Both of these reasons for demise pose a net good for the world because cross-border flow despite the terrorism should result in an increased sharing of knowledge, and historically the world should be safer with states that are more self-sufficient. This is not because I disagree with the second, but I do wonder if the U.S. under new leadership with a bold vision could be capable of radically altering U.S. policy. For example, if a cheap reliable alternative to oil for transportation was developed and implemented, would we instead see destabilization in oil and gas producing nations?

Mr. Haass writes that "The increasingly nonpolar world will have mostly negative consequences for the United States--and for much of the rest of the world as well," because the number of threats and vulnerabilities will increase. But, Mr. Haass does not think that the inevitable nonpolar world has been defined. Rather, he thinks that "The United States can and should take steps to reduce the chances that a nonpolar world will become a cauldron of instability" as long as it still has the capacity to "improve the quality of the international system." The steps he recommends are:

• The most pressing is addressing our energy problems.
  
• He suggests reducing oil and gas consumption to "decrease U.S. vulnerability to market manipulation by oil suppliers."
• I wonder if we couldn't do more, such as funding viable alternative energy sources and adopting supportive legislation.
• "Strengthening homeland security."
  
• Terrorists will succeed, and will not disappear, so we need to make sure that their impact is minimal.
• Okay, but can we please do it constitutionally, at least at home?
  
• Combating nuclear proliferation.
  
• Can we use the military?
• Preemptive strikes on imminent threats are fine, according to Mr. Haass.
• Preventive strikes with "no indication of imminent use--are something else altogether."
• I agree, a nuclear exchange on the other side of the globe would wreak havoc politically and environmentally on this side of the globe.
  
• "Combating terrorism."
  
• Military and police actions are "a loser's game unless something can be done to reduce recruitment."
• The onus should fall on the governments and social networks of the societies where terrorists are bred, and I agree, but they'll need some help.
• Trade as tool of integration.
• Mo' money, fewer problems. Wealth "strengthen[s] the foundations of domestic political order," and "facilitates development, thereby decreasing the chance of state failure and alienation among citizens."
• YES!!! How so Mr. Haass?
• Extend scope of WTO
• Reduce subsidies and tariffs
• Build domestic political support
• Encourage capital flows across international borders.
• Same as trade.
• "[T]he United States needs to enhance its capacity to prevent state failure and deal with its consequences. This will require building and maintaining a larger military ... [and] it will mean establishing a civilian counterpart to the military reserves that would provide a pool of human talent to assist with basic nation-building tasks."
• I couldn't agree LESS.

You really had me up until that last point. These need to be multilateral efforts, not unilateral actions by an even mightier U.S. military. The burden of failed states needs to be spread around the developed nations of the world. We have lost credibility in these actions, as you point in the U.S. policy section, and this would make it harder for us to undertake nation building. Creating a civilian corps is also a bad idea. This would either end up being populated by people too young to know what they are doing or too poorly paid to be the best at their job. The prestige of rank in the military is incentive to draw in some of our best and brightest, but it would be hard to draw talented individuals with promises of rank to an organization without precedent.

Though I do agree that before the world can move forward, "it must be recast to include actors other than the great powers." In particular, "The UN Security Council and the G-8 (the group of highly industrialized states) need to be reconstituted to reflect the world of today and not the post-World War II era." We have new challenges ahead, and the world has come a long way since 1945. Let's get the change going.

Here is Mr. Haass's comprehensive list of the powers that are already establishing themselves as powerful and typical of the types of actors that we will see in the increasingly non-polar world:

In addition to the six major world powers [China, the European Union (EU), India, Japan, Russia, and the United States], there are numerous regional powers: Brazil and, arguably, Argentina, Chile, Mexico, and Venezuela in Latin America; Nigeria and South Africa in Africa; Egypt, Iran, Israel, and Saudi Arabia in the Middle East; Pakistan in South Asia; Australia, Indonesia, and South Korea in East Asia and Oceania. A good many organizations would be on the list of power centers, including those that are global (the International Monetary Fund, the United Nations, the World Bank), those that are regional (the African Union, the Arab League, the Association of Southeast Asian Nations, the EU, the Organization of American States, the South Asian Association for Regional Cooperation), and those that are functional (the International Energy Agency, OPEC, the Shanghai Cooperation Organization, the World Health Organization). So, too, would states within nation-states, such as California and India's Uttar Pradesh, and cities, such as New York, São Paulo, and Shanghai. Then there are the large global companies, including those that dominate the worlds of energy, finance, and manufacturing. Other entities deserving inclusion would be global media outlets (al Jazeera, the BBC, CNN), militias (Hamas, Hezbollah, the Mahdi Army, the Taliban), political parties, religious institutions and movements, terrorist organizations (al Qaeda), drug cartels, and NGOs of a more benign sort (the Bill and Melinda Gates Foundation, Doctors Without Borders, Greenpeace).

Bribery, Arbitration, and IP Data

So go the topics of posts here that are most accessed through Google searches. I'd like to briefly revisit each of these posts.

Thou Shalt Not Bribe, or You Can At Least Snitch On Solicitors
Search terms leading to this post crack me up. They're usually something a long the line of, "how to bribe in china" or "bribery china methods." There is one specific country that these searches predominantly originate from, and this makes it even funnier. Bribery might work well in the short term, but in the long it is going to come back and bite you. In the USA you can get away with bribery by calling it a campaign contribution. In China they don't have convenient bribery channels because there is single party control and any sort of contribution to political or bureaucratic figures is seen for what it is, a bribe. DON'T BRIBE IN CHINA! And if someone asks for a bribe, go to BRIBEline and report them.

Quick note: I regret the title of this post, I wasn't really thinking at the time that lawyers in Hong Kong and the greater common law world call themselves solicitors.

Evaluating Model Arbitration Clauses
If you're drafting an arbitration clause you should not be at my website. Go to the website of the organization that you want to arbitrate under. Then read this document and fill in the holes in the clause from the organization you just got a clause from. That document also has some good tips on building step clauses. This JAMS ADR site also has a bunch of arbitration clauses that will help you build an airtight arbitration clause with step clauses, and it is good for filling in holes in your clause.

Note: The ICC clause is missing a lot, but that is only because the ICC is going to fill in all of the holes for you, but beware, you might find yourself arbitrating in Paris, France if you don't include a location.

Other note: Our International Commercial Arbitration final is today, and I noticed a lot of hits to this page originating from San Diego over the weekend and Monday. Dudes, there's nothing here that the professor didn't already explain in class.

IP Litigation Data and Interpretation
This is just good stuff. The data is accurate. Use it! But I'm not the source, somebody else is.

"If you can afford a car, you can afford a[n IP] lawsuit"

So says Tony Chen of Jones Day's Shanghai office in a recent Economist article, 850,000 lawsuits in the making. Back in an October of 2007 post Dan Harris at China Law Blog shared the following "old adage" with his readers:

[I]f there is one lawyer in town, the lawyer will starve, but if there are two lawyers, both will prosper.

The adage was in reference to the argument that China needs more lawyers to help improve the IPR situation. The Economist article has a data set, reproduced in their graph to the left, which shows that China's patent grants have increased with an increase in the number of IP litigation cases. This suggests that innovators are more comfortable with IP protection and are more willing to protect their IP as lawsuits prove that IP can be protected.

The reasons cited by the article for the "warm[ing] to intellectual property" include:

• The beginning of enforcement of patent laws in 2001 as part of promises for WTO admission.
• The opening of "more than 50 courts that deal solely with intellectual-property cases."
• "[T]he cost of bringing a case is minimal."
• Unlike in the US where there is lots of settlement to avoid legal fees, in China "a judge rules in the majority of cases and damages tend to be small. They normally cover legal costs, however, turning lawsuits into a self-funding method to battle piracy."

It is interesting to see low damages cited as furthering IP protection.

Posts of the Week: 4/7 - 4/13

In Praise of Independent of Judges at China Hearsay
Response from China Law Blog, Jury Nullification With Chinese Characteristics. Directly related post by Danwei from back in Mid-January, Trial by media and the rule of law, and my short response.

Labels seek billions in damages over Baidu MP3 deep-linking at Ars Technica

Australia to China: Let's Not Be Friends at Pomfret's China
Enjoyed Mr. Pomfret's book a lot. Excited to see that he now has a blog. This is an interesting post on the power of China's language and culture.

China Land Speculation: Is This What Moving Inland Is All About? at The China Game

Sovereign Wealth Funds: Opportunity or Threat? at China Business Law Blog

Energy Conservation Law (Manufacturing Operations) at China Environmental Law

Energy Conservation Regulations (Manufacturing Operations) at China Environmental Law

China’s Renewable Energy Law (Policies & Plans) at China Environmental Law

The Law Firm Experience at China Hearsay
I really liked that movie, but damn! Is this really what we have to forward to? At least we'll be able to scale The Cliffs of Insanity, battle Rodents of Unusual Size, and brave The Fire Swamp by the time we're through!

Promises of An Olypmic Post...

Did not come to fruition. Sorry Brad. Instead, this came out. I think I can get a way with this pointless post because it's still the weekend:

I tried to write something, but I was very disappointed with what I churned out. The gist was that I really like the Olympics because of both the sport and the spectacle of the world's nations coming together in good-spirited competition. It is pretty shitty to see them turned into what they are becoming. Some accuse China of politicizing games, while those who are staging protests and going after the flame are themselves politicizing the games.

China's current administration and political system might have aspects that I severely disagree with, but there is much about China that is great and deserves to be celebrated. 150 years ago the British all but subjugated China by turning China into a nation of opium addicts. The Boxer Rebellion was the beginning of the end of Imperial China, and ushered in a period of warlordism. Drugs, rebellion, and warlords aren't typically associated with prosperity, harmony and progress. The rise of Communism and the ascent of Mao started to change things, but the events of the '50s, '60s and '70s in China are some of the most tragic events in history. It was only 30 years ago that China became a stable country, and prosperity started to come. Less than 20 years ago Pudong was a farmland and now it is among the most futuristic skylines in the world. Living standards have increased. The people are safer than they were. Etc... When the Olympic torch is attacked, the protesters cross the line from attacking the parts of China that their signs say they don't to like, to attacking all of the considerable good that modern China has achieved.

I may or may not agree with some of what the protesters say, but attacking the Olympic flame itself is shameful.

Another note, so whatever, I'm awed by spectacle and all that, but carrying the torch from Greece around the world to Beijing is pretty awesome! Who fucking cares if the Nazis did it first in the '36 games? The Nazis were also the first to do a film documentary of the Olympics, so I guess anybody who films the games is a Nazi also, yeah?

Something else, the other day on NPR they were talking about how Sarkozy and other European leaders won't be attending the Games, and they asked a political correspondent if George Bush was feeling pressure to not attend. They replied that George Bush isn't feeling any international pressure, because he might be impervious to it, but that he is feeling domestic pressure. They said that he's pretty much just written off the domestic pressure to the"Darfur crowd," and the "global warming folks." Considering how seriously Beijing and the Chinese people are taking the games, this gesture and those Bushisms could do a lot to improve relationships between our nations. Plus, how could somebody pass up the seats to the Ceremonies and events that Bush is probably being offered?

Will I regret this post? Maybe. But you can't turn back time. You can only delete old posts that you don't like, and hope others can't find a cache in the internet's time machines...

China and LNG

Natural gas is a relatively clean and inexpensive fossil fuel which can be burned to produce a reasonable amount of energy. As of March 2008, California has some of the lowest natural gas prices in the world on the spot market. A lot of this is due to California's ample supply of gas coming in from Canada and the Rocky Mountains.

Last semester Commissioner John Geesman of the California Energy Commission. Came and spoke in one of my classes. A large part of his talk focused on California's increasing reliance on gas. As gas use expands California needs to secure reliable sources of gas to mitigate price risks; the old law of supply and demand suggests that the more supply we can secure, the lower our prices will be. One method of securing greater supply is by importing liquefied natural gas (LNG). LNG is cooled and compressed gas which is more suitable for shipping from distant countries (a liquid or solid state of a substance has approximately 1/1000th the volume of the gaseous state).

Commissioner Geesman pointed out the one major problem with LNG in California, a lack of sites for regassification facilities. Regassification facilities turn the natural gas from a liquid back into a gas. These facilities require land that simply isn't available. Creating offshore facilities presents other problems including interference with shipping lanes and whale migration, prohibitive cost, besmirching of the coastline, and the pollution problem remains. Imported gas (other than that from Canada) also has other problems including a higher BTU content and a higher WOBE index than domestic supplies which our utilities and appliances are not calibrated for. The problem can be solved by commingling the imported gas with domestic gas, but it is a problem nonetheless.

Well, it looks like California can worry a bit less about LNG regassification facility siting because the Financial Times reported today that, China signs two big LNG deals with Qatar. The article observes that a lot of the gas was destined for the US, but no longer after these two new deals involving PetroChina, CNOOC, Royal Dutch Shell, and the Qatari government. China lacks its own natural gas resources and the article says that this kicks the competition up a notch for natural gas in East Asia between China, Japan, South Korea, and "other Asian nations." As long as it helps China kick the coal habit I guess it's a good thing. How much of that gas is around, anyways...

Olympic Torch Brings Light to Product Design

We've been seeing a lot of photos of the Olympic Torch recently. Often, the torch is in compromising positions. The one constant on my mind after looking at all of those photos is, "Gee, that's a real neat looking torch!" It is quite stylized and I've been burning to know: "What is up with its design?"

The good folks over at Wired Magazine have a torch photo gallery with mini-discussions for each photo on technical and design aspects of the torch, High-Tech Olympic Torch Carries 5,000 Years of History. Ever since the 1960 Olympics at Squaw Valley, designers have tried to imbue the torch with cultural themes. 34 designers at Lenovo took a year developing the "Clouds of Promise" design which was the best design out of the 388 submissions. The torch is supposed to evoke a paper scroll, one of China's most important inventions, and it is covered in the color and designs from the Gates of the Forbidden City.

There are some technical aspects that are important in the torch design. It was made to hold up in 65 kM/h wind, and to keep a flame on the roof of the world at the summit of Mount Everest. The torch burns propane, which is pretty clean energy source and is also visible in daylight. The torch also has to have an internal lighting system to keep the flame as constant as possible as the flame is passed between the 10-15,000 torches used in the journey.

The most interesting part of the gallery was the final page where Lenovo's designers described the process of designing the torch and analogized the process to designing laptops:

In the end, Hill says there's not much difference between designing a torch and something like a notebook computer -- other than the fact you're trying to generate heat in the former and dissipate it in the latter. However, he says designing notebooks generally takes longer.

"You have to understand technology, people, culture and environmental factors like heat and cold and wind," he says. "The end design has to understand all of these various constraints and opportunities."

The holistic design, I suppose. The torch was designed with Chinese cues and I think it is beautiful. This sort of reminds me of Mitsubishi's push to use Japanese design in their cars. If done properly the car should be a beautiful example of Japanese design that is aesthetically and technologically appealing across cultural boundaries. The idea is to make the traditional elements of a culture's design beautiful and practical to the world. Different cultures are sure to respond in different ways, for example the colors, designs and shape of the torch mean little to me other than being aesthetically pleasing, but this does not mean that a product cannot attain success without speaking to the culture of its potential customers. The members of a culture are probably in the best position to know and exploit the most aesthetically pleasing artistic cues of their culture that will lead to the success of the product across cultures.

For further reading on the torch check out Lenovo's Page on the Torch.

Brand New US State Department Background Notes on China!

Back in early February I had a post on the new US State Department Background Notes on Macau and Hong Kong. The most interesting part of the post was a comparison between the State Department's Notes on Hong Kong and China. Today the State Department issued a new set of China Background Notes. I thought it would be interesting to see how the State Department's Notes on China have changed since the October, 2007 Notes were released.

The mundane:

• Total GDP and GDP/capita are both up in 2007 on 2006.
• Same for exports and imports.
• Many of the "Principal Government and Party Officials" are new after the 11th NPC.
• Some numbers that were previously spelled have been are now just written.

Some adjustments on the Human Rights front:

• Though the State Department's 2007 Human Rights Practices and International Religious Freedom Reports on China appears to use the exact same language to report on abuses in China as the 2006 report did, "the United States and China agreed to resume ... formal human rights dialogue, with the understanding that the discussions need to be constructive [emphasis added, but unsure if it actually means anything]."

Updates in the Regulatory Environment:

• China is "undertaking efforts in coordination with the United States and others to better regulate the problem" of tainted or substandard goods. In the old Notes, China had only recognized "that up to 20% of the country's products are substandard or tainted."
  

Environment updates:

• Added, "China has pledged to hold the first-ever carbon-neutral Olympic Games."

Foreign Relations updates:

• The number of countries maintaining diplomatic relations with Beijing has risen from 167 to 171, and the number of countries maintaining diplomatic relations with Taiwan has fallen from 24 to 23.

U.S.-China Economic Relations updates:

• They corrected the stat to the US being the "sixth-largest foreign investor in China." Question, what are the British Virgin Islands doing at the number 2 spot? Tax shelter investments?

Basically, there's not much of any consequence that it is new... Maybe the increases and decrease in diplomatic relations, and maybe the new constructive approach to human rights are interesting enough for an expansion. Maybe...

CIC on 60 Minutes

This morning I got an email from a loyal reader about the 60 Minutes article that aired last night, China Investment An Open Book? The video and transcript are available at that link. The focus of the story is an interview with Gao Xiqing, President of the China Investment Corporation (CIC).

Before I started typing away I decided to check what else was out there. Rich Brubaker at All Roads Lead to China has a post up, 60 Minutes Report: China’s Sovereign Wealth Fund. Mr. Brubaker gives a nice summary of the material covered in the article, but I disagree with his perceptions of the piece:

In the end, it is clear to me that 60 minutes has decided to take a protectionist stance, and I cannot tell you how disappointed I am in Ms. Stahl and her implications that China is suspect of anything. The fact is that the US would not need these investments were its own fiscal house were in order. Perhaps Ms. Stahl and the rest of the US would be happier if it were another country making the investments, but perhaps it would be better not to create the financial mess that is currently the US economy in the first place?

This was not clear to me, and it was not clear to the reader who emailed me this morning who thought:

They touched heavily upon the fear the U.S. has of China taking us over financially. The guy [Gao Xiqing] comes off great - it should calm some feathers.

There is always a reason behind these 60 Minute stories, and Lawrence Summers touched on the reason for this particular story near the middle:

[I]n a way, their willingness to be interviewed and go on your show is probably not something they would do if they thought of themselves as having some nefarious purpose.

60 Minutes is a show that has a large middle-aged and older viewers. This is the most dense voting bloc in the US, and their opinion matters a lot. Surely, part of Mr. Gao's motive in the interview was to show the U.S. that they do not need to be afraid of CIC in particular and China in general. Nothing too tricky, and it would be hard to miss. He even said that his motive was to dispel fears.

Gao Xiqing did come off great. He was calm, charismatic, well-spoken, and genuine. And, he competently painted CIC's motives as wholly economic. By contrast, career China hawk Peter Navarro came off as a lunatic in the video. He was talking too loudly and too quickly, and the words coming out of his mouth made little sense. Lesley Stahl even suggested as much in the following exchange:

"China has so much money that they can spend buying U.S. companies that the danger is that they can strip these companies," Navarro said. "They can strip the companies of jobs, research and development, technology."

"Do we have any evidence, any reason to believe that they’re really going to do that?" Stahl asked.

"It’s not a clear and present danger," Navarro said. "It’s a clear and future danger."

Read: No, there is no evidence, but, but, but look at the "pattern of behavior." If there are people who have already been convinced by this argument, then they're not going to change their mind. But for those undecided on CIC, I think Mr. Gao did a lot to brighten CIC's financial motives, and I think that in the end Lesley Stahl came off as against Navarro, and more towards Gao. I hope much of America saw the same.




A thought I had while watching: If China actually used these companies for political purposes then they'd need directors, officers, or large enough shareholdings to owe fiduciary duties. If they acted in the best interest of China rather than the company, they'd be the targets of some substantial shareholder derivative suits.

Just quick comment: I don't know that the promise to operate CIC as transparently as The Government Pension Fund of Norway, but Mr. Gao now has a standard of conduct that he has pledged to in the news.

Links to Chinese Law Resources

This weekend I found a useful sites for Chinese legal research.

The first is the website for Chinese law firm, Panawell & Partners, LLC (h/t IP ThinkTank). Their website has many of the relevant PRC IP laws and regulations in Chinese, English and Japanese under the "Law & Regulations" heading. Under the "Publications" heading, the firm is publishing memos on aspects of Chinese IP law. These make a good resource, and I look forward to watching their publications section grow.

The second is the glossary section of the website for another Chinese law firm, Longan Law Firm. This section of their website has 147 pages of translations of English language legal terms of art into Chinese. Quite useful!

Posts of the Week: 3/31 - 4/6

It's the (domestic) Economy, Stupid at China Hearsay

The Sounds of Bubbles Bursting at Managing the Dragon

Retail Reality at China Business Services

FDI Changes at China Hearsay

PMI numbers are too strong at China financial markets

Comparing the Current Account Balances of the U.S. and China at Transnational Law Blog

If You Are Manufacturing in Beijing, Tianjin, or Shanghai. PAY ATTENTION at All Roads Lead to China

Amount in Controversy and Jurisdiction Redefined by the SPC at China Business Law Blog

Is China's Interior Missing Parts? Or Are You? at All Roads Lead to China
And more commentary on the article at China Law Blog,
China's Interior is Missing Some Parts

Businesscast: China's new labor law, everybody gets tenure at Danwei

National Energy Commission & National Energy Bureau (Can we make this any more confusing?) at China Environmental Law

A Dam Problem

There's a fine article at Scientific American on the Three Gorges Dam, China's Three Gorges Dam: An Environmental Catastrophe?, with the subtitle, "Even the Chinese government suspects the massive dam may cause significant environmental damage." There's no disputing that the Three Gorges Dam is an impressive, useful, feat of engineering. The game designers in Civilization IV even made it a world wonder ranking the dam up there with the Parthenon, Eiffel Tower, Statue of Liberty, the Hanging Gardens of Babylon, and the Pyramids of Giza. So, let's begin with the good of the dam and then move into the environmental troubles it is creating.

Three Gorges has two great things going for it, aside from a demonstration of China's engineering:

• The dam generates power, a lot of power. 18,000 megawatts upon completion, to be precise. To be less precise, and more visual, that's around 8 times the power output of the Hoover Dam.
• The power Three Gorges generates is clean, real clean, especially in comparison to the coal-fired energy that provides 82% of China's energy. China currently gets 7.2% of its electricity from renewable sources, and China plans on using dams for 1/3 of its goal of getting 15% of its energy from renewable sources by 2020.

The Scientific American article says that all of this clean energy is coming at a potentially hefty environmental price. Much of the worst damage is speculative, but what has happened already is still serious. The areas of greatest concern are: landslides, decreases in biodiversity, and disease and Drought.

• Landslides
• A month after the first of three incremental water fills 20 million cubic meters of rock fell into the Qinggan River making 20-meter waves that killed 14 people.
• Last November, a 3,050 cubic meter slide buried a bus killing at least 30 people.
• The same displacement of land that has been causing landslides may result in earthquakes as water pressure mounts on the numerous fault lines in the Three Gorges area.
• Decrease in Biodiversity
• China "is home to 10 percent of the world's vascular plants (those with stems, roots and leaves) and biologists estimate that half of China's animal and plant species ... are found no where else in the world. The Three Gorges area alone accounts for 20 percent of Chinese seed plants--more than 6,000 species."
• The Three Gorges dam threatens the habitats of over 400 plant species
• Of the Yangtze's 177 unique fish species, 25 are already endangered from overfishing, and the rest are threatened as their natural flood plain habitat disappears into a network of lakes
• BUT, the effects of the dam on biodiversity cannot be truly be determine until long-term data on the effects of the dam have been collected
• Disease and Drought
• With the Yangtze reaching "its lowest level in 142 years," there is evidence that the dam may be "spurring drought in central and eastern China."
• Decreased fresh water flow is resulting in salt water pushing further inland.
• There has been a "spike in schistosomiasis [a human blood parasite released by freshwater snails]."
• Further study is needed to determine if other diseases are spiking.

Is this simply the price of progress and clean energy?

Past post:
Dam Disagreement

Chinese Art & The Law

Yesterday while checking my gmail I noticed a link in the RSS feed at the top of the page to an International Herald Tribune article described as something along the lines of "Chinese investors savvy in the art market." I clicked on the link and it brought me to an article entitled, Souren Melikian: Art casualties from Tibet to Cambodia find an eager market. The article was interesting, but nothing like the description from the RSS. Instead the article was about two recent auctions at Sotheby's and Christie's of art from Southeast Asia and the finest examples coming from Tibet. The catalog for the Sotheby's auction can be found here; unfortunately Christie's does not appear to catalog their catalogs online.

The article focused on the prices fetched by various pieces at the auctions. The 11th century Khmer statue, which has a photo in the article, set a new record for Khmer statues of $2.11 million. The statue was of exceptional quality and had considerable provenance. Provenance is presented as a two-fold attribute: 1) a history conferring legitimacy, and 2) high certainty of original location of the art/antique. The pieces that sold at or above their estimate range tended to have a history demonstrating that they had been in circulation since before the Cultural Revolution, and with a history that placed the pieces originally at certain sites. Pieces that sold under their estimates were of questionable provenance because they were hidden during the Cultural Revolution and the buyers were unsure of where they originally came from, or buyers suspected that the pieces may have entered the market by way of more recent and illicit looting and digging. This could create a legal problem that would force the buyers to handover the antiques to the proper government authorities if it was discovered that they were acquired through illegal means.

Well, this got me thinking about China's laws on antiquities. The best general outline of the issues and laws that I found was in a Comment in the Cardozo Arts and Entertainment Law Journal, THE GREAT MALL OF CHINA: SHOULD THE UNITED STATES RESTRICT IMPORTATION OF CHINESE CULTURAL PROPERTY?, on pages 937 - 944. The author writes that there are three main issues in "China's cultural relic problem:"

• "[R]apid economic development."
• Helps cultural relics by making China a "market nation" for its own cultural relics, but...
  
• Urbanization, including the Three Gorges Dam, has led to the destruction of many cultural sites.
• "[T]omb robbers and illicit smuggling."
• "[D]isturb[s] the integrity" of the art in a way that the careful cataloging and documentation of archaeological digs does not.
• "China's lack of domestic control capabilities."
• "There is a distinct gap between Chinese national policies and practice."

The author points to three national civil laws and regulations, and one criminal law that Beijing has promulgated to protect their cultural relics.

• 2002 Law on the Protection of Cultural Relics
• and it appears that this law was updated in December of 2007, and is available at LawInfoChina
  
• Regulations on Enforcing the Law on Cultural Relics Protection (available at LawInfoChina for a fee)
• Provisional Rules on Administering the Auction of Cultural Relics (available at LawInfoChina)
• Part 2, Chapter VI, Section 4 of 1997 Criminal Law

There are also several municipal laws that have been promulgated with regard to cultural relics. The author notes that none of these laws have been on the books long enough to substantiate their efficacy. My problem with these laws is I found it real hard to discover the law on what I would actually need to know: what could I actually buy, and could I get it out of the country?

Some website says that there are a bunch of different regulations and all you can really do is rely on the legal advice of your Chinese antique dealer on whether you can export the antique, and hope it clears the obligatory trip to the Customs Office. The same site says that you can export wood antiques of any age out of the country, but antiques made of Red Sandalwood, Yellow Rosewood, or Chicken-wing Wood can't be exported if they're older than 300 years. Then some other site said you can't export wood if it's older than 1789. It gives me a headache.

It sounds like all you really can do is rely on the legal advice of your antiques dealer, and if you're buying something "old enough" it might be a bit of a crap-shoot getting it out of the country.

The "24" Effect

Award-winning and critically acclaimed TV show "24" has had quite an impact upon our society. The extent of 24's influence goes beyond the tendency of actors to convey badassedness by whispering every single one of their lines. According to Brigadier General and Dean of West Point Patrick Finnegan, 24 has "had an adverse effect on the training of actual American soldiers by advocating unethical and illegal behavior." (quote from the Wikipedia site). Just about every week, or every hour in the time-scale of 24, Jack Bauer saves the day by torturing a terrorist who gives up the location of, usually quite literally, a ticking time bomb. According to one of the creators of 24, the "'ticking time bomb' situation never occurs in real life, or very rarely." Despite this we have President Bush's advisers saying that the crushing of the testicles of a terrorist's child would be a legally permissible way of obtaining information in ticking bomb situation. In the fallout from Abu Ghraib and US detention centers around the world, this debate about torture in ticking time bomb situations was extended to Congress and the wider press. When the Dean of West Point is citing 24's influence on his students, surely the show must have had an influence on the wider American public's perception of torture?

Fortunately, I don't have to answer that question today. Instead, I'm going to conclusively prove that the rising level of badness of Chinese characters in 24 correlates with an increase of negative views of China in US media. As everyone knows, correlation is the best way to find evidence for tenuous conclusions that the Man doesn't want you to know about. They usually try to totally bring down this sort of stellar research by referring to it as "coincidence." Well, let me ask you: is it coincidence that 24 runs on Fox?

To begin, let's look at the increasingly nefarious portrayal of Chinese people in the Days of 24 beginning with Day 3.

Day 3
There's no Chinese involvement in this season.

Day 4
A Chinese national is complicit in the bad stuff and Jack infiltrates the embassy. Jack commits pseudocide to prevent the US government from selling him out to the Chinese.

Day 5
Jack totally faked out the PRC! But, when terror strikes LA again, Jack must emerge from hiding and whoop up on some terrorists. This makes his presence known to the Chinese and they totally jack Jack at the end of the season and send him packing to China.

Day 6
The Chinese release Jack. But bad Chinese guys play the biggest role of their careers in this most recent Day of 24. They never tell us what happened to Jack during his 20 months in China, but it must have been bad because the weird burns on his hands totally get our mind spinning with the possibilities. Plus, the Chinese faked Audrey's death and tortured her, too! Some bad Chinese dude is in cahoots with Jack's dad and brother, but maybe just his dad because his brother's sort of a tool. They're scoring a card for the Chinese that will give them all they need to know about Russia's defense systems so the Chinese can get a first strike going against the Russian's who became increasingly belligerent on the show (and in real life, but investigating Russian's mirroring their behavior in 24 is the domain of another blog). Chinese agents drive helicopters and Hummvee's around LA's outskirts blowing stuff with machine guns in order to catch Jack who is messing with them because he always has a plan. His plan works! There's even a Chinese submarine that was chilling of the coast of LA waiting to pick up his dad to start a new life in China because China's going to be better than the US in a decade!? [See end of post for better discussion of this from somebody else]

The Study
For the study I did some LexisNexis searches in the New York Times for different search terms that are related to China for 24 Days 3-6. I searched for "china & bad," and "china & danger!" for the full course of each Day, and I searched for "china," "china & bad," and "china & danger!" for the month following the end of Day. I then recorded the number articles that included each of these terms and recorded the results in the chart below:

Full Course of Each Day

	china & bad	china & danger!
Day 3	128	88
Day 4	140	108
Day 5	134	119
Day 6	183	131

Month Following Conclusion of Each Day

	china	china & bad	china & danger!
Day 3	274	22	26
Day 4	354	38	24
Day 5	340	30	37
Day 6	417	40	35

The proof is irrefutably in the pudding. Over the course of these four Days of 24 China is more on the media's mind, and the media views China as both more bad and more related to words that begin with danger. This correlates exactly with an increase in the badness of Chinese characters in 24. 24, and by extension Fox, must be manipulating our minds about the perceived danger posed by China. There cannot be any other rational conclusion.

Those who are unable to understand the intricacy of this study, or those unwilling to grasp the results are going to say something like: "24 doesn't have anything to do with negative media portrayals of China. It has more do with China's explosive growth, rising challenges to US hegemony, perceptions of unfair trade and monetary practices, and poisonous toys." My response: show me some proof. You'll probably give some boring qualitative diatribe on why. Well guess what? I've got numbers. Numbers don't lie. Numbers let us tell interesting stories.

Conclusion
To summarize, 24 has taught us more than torturing and killing terrorists (suspected and otherwise) can solve all of your problems. The show has taught us more than talking in a whisper is really dang cool. The show has taught us more than it only takes a shower, a shave, and a new set of clothes to fully recover from 20 months of continuous torture. And despite the media's apparent misunderstanding, the show has taught us more than the Chinese are bad people who want to destroy us by providing funding to terrorists. The show has taught us that a shadowy cabal of scotch drinking, blue-tooth earpiece wearing businessmen, who are led by either your father or brother are actually almost certainly the mastermind's behind terrorism in the US because they were acting in patriotic or monetary interest.

For a take on the same issue that wasn't posted on any April 1st, check out TIME: China Blog, '24' has China on the Brain!

[Please, note the date of the post]