Unique Practice of the Regulation on CD-R Management.

Subsequent to our report in April, 2001, the Taiwan Legislative Yuan on October 31, 2001, passed the Regulation on CD-R Management as part of the efforts for WTO entry, which came into force on November 16, 2001.

The Regulation adopts the scheme of origin management, regulating the CD-R content recording manufacturers. Any manufacturer plans to produce prerecorded CD-R shall apply, with the competent authority, i.e. the Ministry of Economic Affairs (MOEA), for the approval of CD-R factory and for the import and/or transfer of the manufacturing equipment before putting in operation. Any prerecorded CD-R and master thereof are required to imprint the source identification number (SIDN), properly issued by the MOEA. The Regulation further empowers the authority in charge of entering the CD-R factories to inspect the legality of their operation.

Violations of the Regulation may incur administrative penalties, followed by criminal punishments. An order to comply will be issued first with fines up to US$ 87,000 each time until compliance of such an order. Severe ignorance will result in sentence of up to 2 years in prison.

As a major manufacturing country in the CD-R market, Taiwan has been the focus of the international and domestic IPR societies for its infringement problem. The promulgation to the Regulation on CD-R Management is expected to provide a mechanism for efficient administration of CD-R products as well as preventing potential infringement at the beginning.