Journal of Intellectual Property Rights
Vol 18, September 2013, pp 419-438
Protecting Layout Designs on Printed Circuit Boards in China and
Some Key Industrial Countries - New Regulatory Regime from a
Law and Economics Perspective
Wei Shen†
Shanghai Jiao Tong University, KoGuan Law School, 1954 Huashan Road, Xuhui District, Shanghai 200030, China
Received 2 April 2013, revised 22 August 2013
This article examines the position in China and a number of leading industrial jurisdictions under the regimes of
copyright, patent and design and argues that there may be good grounds for conferring intellectual property (IP) protection
in the layout designs in printed circuit boards (PCBs), as a form of sui generis IP right. In particular, this article addresses IP
protection for PCBs in China, a major manufacturing-dependent developing jurisdiction. Local manufacturers in developing
countries such as China may make pirated copies of PCBs that have been copied from foreign manufacturers and use the
boards in locally and cheaply made electrical devices. Therefore, the issue of IP protection for PCBs is not only a doctrinal
inquiry into the parameters of IP law but also an inquiry into the policy interests and the balance of interests between
industrialized and developing countries.
Keywords: Layout design, printed circuit boards, regulatory regime, IP protection, law and economics
Printed circuit boards (PCBs) contain layouts of
electronic circuits and components for particular
electronic functions in devices.1 PCBs are different
from integrated circuits (ICs), which are electronic
circuits miniaturized to fit electronic components on a
piece of semiconductor material such as silicon.2
An IC serves to allow easier connections to a PCB.
Technically, the key function of PCBs is to
electronically connect and mechanically support
electronic components using conductive tracks,
pathways or signal traces etched from copper sheets
laminated onto a non-conductive substrate. The
purpose of a PCB is to connect ICs and discreet
components together to form larger operational
circuits.3 In contrast, ICs are microprocessors and
memories performing information processing and
storing and retrieving data.
Layout designs of ICs and PCBs also vary from
each other. Layout design (or ‘topography’) of ICs
refers to the three-dimensional disposition (however
expressed) of the elements, at least one of which is an
active element, and of some or all of the
interconnections of an IC, or such a three-dimensional
disposition prepared for an IC intended for
_______
†Email: shenwill2@gmail.com
manufacture.4 Put differently, designing an IC’s
layout is a photolithographic process to deposit and
etch a pattern on a chip of electricity-conducting
materials, e.g., semiconductor devices (transistors)
and passive electronic components (resistors and
interconnections). Layout designs of PCBs merely
involve the placement of components and the routing
of traces, which play a crucial role in determining the
electromagnetic compatibility of products employing
printed circuit boards. Designing PCB layouts reflects
a designer’s knowledge of placing and configuring5
components and traces and their underlying functions.
PCBs are essentially industrial works. As the layout
of the electronic circuits and components on the board
are a result of the application of intellectual effort and
planning, and may be unique; this article intends to
examine if such layouts are protectable as intellectual
property (IP) and whether they should be if current
laws in China and other key industrial countries do
not give such protection.
The article first outlines the piecemeal legal
framework in China addressing IP protection of
layout designs for PCBs. It then looks into the
possibility of protecting PCBs under copyright, patent
and design laws by reference to IP laws in some
major jurisdictions. The direct protection of layouts in
420
J INTELLEC PROP RIGHTS, SEPTEMBER 2013
PCBs is limited in many jurisdictions if such
protection can be found. A law and economics
analysis is further offered, focusing on the legitimacy
and rationale of having a separate IP protection
regime apart from the current copyright, patent
and design laws. Special attention is given to
the IP protection of PCBs in China with the
aim of advancing its technological and economic
developments. The article ends with a short
conclusion.
Rights in Layout Designs on PCBs – IP Protection
under Chinese Law
Printed circuit boards have mushroomed in China’s
electronic industry while China has gradually
become a manufacturing power. PCBs are used in
virtually all but the simplest commercially
manufactured electronic devices, and have been
playing an increasingly vital role in our daily life
along with the rapid and marvelous progress of the
telecommunications sector. China has overtaken
Japan and become the largest PCB manufacturing
base in the world since 2006. China’s PCB output
value reached US$ 22.09 billion and accounted for
39.8 per cent of the global market in 2011, increasing
from 8.2 per cent in 2000. It has been estimated that
the output value will reach US$ 33.1 billion, about
46 per cent industrial share of US$ 72 billion in
2016 (ref. 6). Meanwhile, the volume of production in
China grew from 130 million square meters in 2006 to
190 million in 2011, with the expansion of sale from
US$ 15.94 billion in 2006 to US$ 23.84 billion in
2011 (ref. 7).
There is growing concern over the IP protection for
layout design of PCBs under Chinese law. Currently,
there is not a single piece of legislation which
addresses how to protect PCB layout design in China.
This section discusses how a PCB layout design is
protected under Chinese law.
Regulations for the Protection of Layout Designs of Integrated
Circuits
The TRIPS Agreement obliges Member States to
protect the layout designs of ICs in accordance with
the Treaty on Intellectual Property in Respect of
Integrated Circuits (the ‘IPIC Treaty’), which has
never been in force due to the lack of a sufficient
number of ratifying countries.8 Layout designs of ICs
are protected for at least 10 years from the date of
filing an application or of the first commercial
exploitation in the world.
The Regulations for the Protection of Layout
Designs of Integrated Circuits (the ‘Layout Design
Regulations’), issued on 28 March 2001 and effective
as on 1 October 2001, is probably the most relevant
piece of legislation in this regard in China.9 The
Layout Design Regulations affirm that what is
protected is the exclusive rights of layout design
rather than integrated circuit itself.10 Upon
registration, layout designs of integrated circuits will
be protected for a ten year term against reproduction
and commercial exploitation. Of particular relevance,
the Layout Design Regulations lay down an embargo
on as well as impose tortious liability on such
infringing acts as reproduction and commercial
exploitation in several specific ways. Thus, prima
facie it may be presumed that a PCB layout design
can be well protected once registered.
This understanding of the regulatory space under
the Layout Designs Regulations does not take into
account the plain fact that there is still much that
distinguishes PCBs from integrated circuits.
Significantly, they are different from each other in
light of science and technology, and are two
totally distinctive kinds of objects. The IP protection
regime for IC layout designs cannot be applied
to the layout designs of PCBs, which has been
clarified by the Guiding Catalogue for Industrial
Structural Adjustments, issued by the PRC
National Development and Reform Commission
(China’s major planning authority) on 27 March
2011, in which ICs and PCBs are listed in two
separate categories. This categorization has also been
confirmed in the State Council’s Plan to Restructure
and Upgrade Industries (2011-2015). The layout
design of PCBs clearly does not fall in the scope of
the Layout Design Regulations.
Copyright Law
‘Works’ to be protected under the Copyright Law11
include works of literature, art, natural science, social
science, engineering technology and the like which
are expressed in the following forms:‘…(7) drawings
of engineering designs, and product design drawings,
maps, sketches, other pictorial and graphic works,
computer software and model works’[Article 3(7)]. It
seems that the original layout design of PCBs
presented on paper, though different from
photographic works, cinematographic works and
computer software, belongs to works protected by the
Copyright Law, and without the permission of the
copyright holder, it shall not be copied or distributed
SHEN: PROTECTING LAYOUT DESIGNS ON PRINTED CIRCUIT BOARDS
in the form of publication12 and adaptation.13
It is however unclear under the Copyright Law
whether the production of PCBs based on the
layout design is equal to the ‘reproduction’ protected
under Copyright Law.14
Patent Law
At first glance, the layout design of PCB is similar
to a new design and may fit the criteria of industrial
application, which can be protected under the Patent
Law.15 However, layout design of PCB is more than
just a design of any new shape, pattern, a combination
of shape and pattern, or the combination of a colour
with the shape or pattern, of a product, which creates
an aesthetic feeling.16 It has its own functionality,
more than just aesthetics, that is, a product’s
ornamental or artistic feature. This so-called ‘aesthetic
feeling’ is a subjective factor, and should be visible to
the naked eye. Therefore, layout design, whose
internal structure cannot be seen, is not a design under
the Patent Law.
PCB layout design also fails to satisfy the
requirement of inventiveness, which is a must
together with novelty and practical applicability when
patent rights are granted to inventions or utility
models (Article 22, Patent Law). While a utility
model needs to possess substantive features and
indicate advancements, compared to existing
technologies, the layout design of PCBs does not
comply with the requirement, not to mention the more
prominent and remarkable standard required by the
inventions. To tailor the constantly changing needs of
electronic products, those layout designs with some
subtle changes but which may play a role in realizing
the function of PCBs, such as some new arrangements
of wires, cannot be equated to the possession of
substantive features or indication of advancements. In
other words, a layout design of PCB does not meet the
stringent requirements under the Patent Law for
inventions and utility models.
Anti-Unfair Competition Law
Unfair competition law is explicitly identified in the
TRIPS Agreement as a national regulatory option for
protecting layout designs of integrated circuits. The
unfair competition regime assures effective protection
against unfair competitive conduct.
‘Unfair competition’ is broadly defined in the
Anti-Unfair Competition Law as ‘a business
operator’s acts violating the provisions of this Law,
infringing upon the lawful rights and interests of
421
another business operator and disturbing socioeconomic order’.17 The infringement of the right over
PCB’s layout design to some extent can be deemed as
an act of unfair competition since illegal and
opportunistic behaviour of business operators in
violation of the principles of equality, fairness,
honesty and business ethics (Article 2) may lead to
unfairly lower costs for producing electronic
products so as to secure a higher market share
for the infringer. By doing so, the infringer may
discredit the establishment, the goods, or the industrial
commercial activities, of a competitor (Article 10bis,
Paris Convention).
The other possibility of protecting PCB layout
designs under the unfair competition law regime is to
provide trade secret protection. However, layout
designs need to overcome several technical regulatory
challenges. First, the concept of ‘business secrets’
under the unfair competition law is narrowly defined.
Layout designs need to be qualified as ‘technical and
business information’. Second, the process of
developing the PCB layout design which is yet to be
disclosed may be arguably protected as business
secrets.18 The challenge is that though regarded as
business secrets, once the products incorporating
PCBs are available in the market, layout designs of
PCBs while hard to develop usually with high input,
can be easily attained by reverse engineering.19 In
other words, trade secret protection cannot be relied
upon as the layouts can be readily discernible by
examination of the marketed product. The Chinese
Supreme Court also rules out the possibility of relying
on the trade secret law for protecting layout designs of
PCBs.20 Third, the right-owner must take measures to
keep layout designs confidential. This requirement not
only imposes additional costs on the right-owner but
also rules out the possibility of being protected under
the patent law regime, since the filing process shall
release confidential information.
Meanwhile, since PCBs essentially fail to withstand
the test of reverse engineering, the ease with which
reverse engineering can be carried out can facilitate
the creation of layout designs without originality, on
the basis of the evaluation or analysis of the protected
layout design for commercial purposes. Thus, taking
into consideration the above, it appears the PCBs will
constantly be in danger of being pirated. Therefore, a
PCB layout design can be only protected under the
Anti-unfair Competition Law when it is still in the
process of being developed and undisclosed.
422
J INTELLEC PROP RIGHTS, SEPTEMBER 2013
Judicial Practice
China is a civil law jurisdiction in which cases do
not have precedent value. Interpretation of the law is
usually decided by the court on a case-by-case basis. In
practice, cases published in the Supreme People’s
Court Gazette often act as leading cases, without
binding effect in a strict legal (or common law) sense,
guiding lower courts to form their judicial opinions on
similar legal issues. Judgments so published however
do not enjoy the same status as in common law
jurisdictions. In China, not all court decisions or cases
are published and available to the public. In fact, a
large majority remain unavailable even though the
judicial system has gradually become more transparent
in the recent years with the publishing of more legal
material. For these reasons, both legislative authorities
and academic circles have long been reluctant to accept
precedents as a source of law or legal study.
There are very few reported cases in relation to IP
protection of IC or PCB layout designs. In two
reported cases published concerning the infringement
of layout designs of ICs, the courts issued judgments
in favour of the design owners based on Layout
Designs Regulations. There was only one judgment
published in the Supreme People’s Court’s case
reports (but not in its Gazette) concerning an
infringement of PCB layout designs. In the case of
Shanghai New Focus Auto Components Co Ltd v New
Focus Lighting & Power Technology (Shanghai) Co
Ltd and Shanghai Soleil Auto Parts Co Ltd, the
Shanghai High Court, in agreeing with the lower
court’s judgment (which had confirmed that the
defendants’ acts constituted an infringement), refused
to provide IP protection to layout designs of PCBs
due to the lack of regulatory or legislative grounds,
and, more specifically, rejected the plaintiff’s claim
that PCB layout designs be protected under the
copyright law because designs have functional
characteristics but lack cultural or spiritual elements
which the copyright law is supposed to protect.21
The current status is that Chinese law may only
provide partial protection to the layout design of
PCBs. How to protect PCB layout design is still in a
nascent stage, unclear and unsettled under China’s
intellectual property system.
Rights in Layout Designs on PCBs - Testing the
Parameters of Current IP Laws
IP Protection based on Copyright
Copyrights provide a wide range of protection to the
right owner, ranging from the right to make copies,
right to prepare derivative works, to distribution
rights, and moral rights, all of which substantially
preclude the possibility of infringement in various
possible ways. Moreover, a copyright lasts for the life
of the author plus several decades.22
The question is, does the current copyright regime
in leading industrial nations protect layout designs on
PCBs? Layout designs could be argued to be artistic
works to attract artistic copyright. The argument
could be made that the PCB is a 3-dimensional
reproduction of artistic work found in the printed
circuit diagrams. Alternatively, since the diagram
contains notations, it could be alleged that the PCB
gives form to the information represented as literary
work of the diagram. The analogy with a literary work
is however, somewhat limited, as the notations may
merely be regarded as the equivalent of a plot; or of a
detailed plot; or of a first draft; or of a final draft.23
Nevertheless, a simple survey shows that most major
jurisdictions do not provide copyright protection to
layout designs of PCBs.24
The main feature in the copyright regime of many
leading industrial jurisdictions is that the work should
have some aesthetic quality. Layout designs on PCBs
are generally utilitarian in character. In the US25 and
leading European jurisdictions, emphasis is placed on
the aesthetic quality of the work to qualify for
protection under copyright law. In the UK, however,
there had been willingness to extend copyright
protection to works of utilitarian nature that were not
aesthetic in character.26
US Copyright Law
US copyright law does not protect the mechanical
or utilitarian aspects of works.27 Rather, copyright
protects pictorial, graphic, or sculptural authorship
which can be identified separately from the utilitarian
aspect of an article. If the layout design on a PCB is
for aesthetic rather than functional purposes, the
aesthetic features may be copyrightable but the
functional features may not. As PCBs serve the
particular purpose of determining electrical and
electronic performances of the larger device in which
the PCB is used, the layout design of PCBs can hardly
be said to be aesthetic in quality. The US is also one
of the few countries which have a registration system
for copyright. The US Copyright Office has been
allowed to protect artistic drawings, notwithstanding
that they may afterwards be utilized for articles of
manufacture.28 It is the practice of the US Copyright
SHEN: PROTECTING LAYOUT DESIGNS ON PRINTED CIRCUIT BOARDS
Office to make a determination as to whether the
work submitted is a work of art, or falls within one of
the other categories of work (or subject matter) for
which copyright protection exists. In other words, the
question of whether the application has an additional
mechanical or utilitarian function is not considered. In
practice, registering layout designs of PCBs has never
achieved a success due to the functional natures of
these designs.29
French and German Copyright Law
Artistic works and designs essential to achieving a
technical result, or forms exclusively dictated by their
function are not protected by copyright in France as
well. The French courts prefer the view that when a
shape or design (appearance) is solely functional, the
condition of originality of the work is lacking.30
German courts31 have imposed a further
requirement for applied art, employed in the
design of useful objects, that the work of the
designer must be something out of the ordinary and
must show the artist’s personal ideas. A PCB drawing
is unlikely to have sufficient personal artistic content
because the diagram is dictated by the electrical
functionality of the device in which the PCB would be
used. Article 2(2) of the German Copyright Code has
been interpreted by the German courts to the effect
that works are only protected by copyright if they
show a sufficient level of creativity.32 As a PCB will
in most cases be designed to achieve a technical
result, there is insufficient personal intellectual
creation for copyright protection. It is unlikely that
copyright protection would extend to the PCBs
themselves. Even if copyright did exist in a circuit
diagram, copying a PCB itself, without having used
the drawing, would not under German law be
considered as infringing copyright in the drawing.33
Japanese Copyright Law
Under Japanese law, there would be no copyright
protection for PCBs because it is not the type of work
in which copyright subsists. Article 2(2) of the
Copyright Act defines artistic works to include
‘articles of artistic craftsmanship.’ The legislators
considered that works, which are intended for use as
models or designs of mass produced articles, should
be protected under other industrial property law.34
Three Japanese cases support this proposition. First,
the Shinobu Building case35 concerning the copyright
in drawings for the design of a house, in which the
court denied copyright because the drawing failed to
423
express the author’s cultural or spiritual thoughts,
separated from its utility or functionality. Secondly, in
the Blueprint machine case36, the plaintiff owned
copyright in a blueprint drawing for a machine but the
defendant made a machine from a copied drawing. It
was held that not all the features in the plaintiff’s
drawing were dominated by utilitarian considerations,
and the manufacture of the machine did not infringe
copyright because this otherwise would lead to
copyright protection for the utilitarian functions
performed by the machine. The Court concluded that
the production of the defendant’s machine did not
infringe the copyright in the plaintiff’s blueprint.
Thirdly, in the Wood-Grain pattern case37, the
plaintiff made and sold paper on which a wood-grain
master pattern was used. The Tokyo High Court
denied the existence of copyright in the master
pattern. Rather, it was held that since the master
pattern is a mass-produced industrial article for a
utilitarian purpose, it does not constitute ‘pure art’.38
The master pattern did not fall under the category of
literature, art or music, and was not copyrightable.
Thus, in practice, there may be copyright protection in
a drawing for PCBs, but only if and to the extent that,
the features in the drawing are not dictated by the
utilitarian and/or technical function of the item. For
PCBs, this might indeed exclude roughly everything
from copyright protection.
UK Copyright Law
Under English law,39 there is no requirement that
artistic works need to be aesthetic in character. Thus,
functional circuit diagrams could be ‘artistic works’,
as artistic works include drawings. It seems that
English law is the only regime where layout designs
in PCBs may find copyright protection.40
Nevertheless, as a matter of practice, copyright
protection may be unavailable to layout designs on
PCBs because of the difficulties in proving
infringement. One critical criterion in determining
whether artistic copyright is infringed is the visual
similarity between the allegedly infringing product
and the artistic work.41 The right-holder needs to
make a PCB with a different visual appearance from
the circuit drawing, but having the same circuits and
functionality.
Another argument that can be made in favour of
copyright protection is by relying on literary copyright.
The circuit diagram on which the PCB is based, or the
list of notations on the diagram may constitute a
literary work. The issue is thus whether a circuit
424
J INTELLEC PROP RIGHTS, SEPTEMBER 2013
diagram, a list of components together with a special
notation for their interconnection, is entitled to
copyright as a literary work.42 In Anacon Corporation
Limited v Environmental Research Technology Limited
and Anor,43 Jacob J held that it was possible for circuit
diagrams relating to an electronic dust meter to be both
artistic works and literary works. However, critique
against this holding has been directed at the possible
subversion of the idea/expression dichotomy in
copyright law. Copyright has always been summarily
described as protecting expression and not ideas.
Thus, if the list of notations in circuit diagrams is
held to be a literary work and infringement of such
work could be by producing a circuit that corresponds
to the functionality described in the notations,
then what is being penalized is the copying of
the ideas in the notations and not the expression of the
notation as such.44 Doubt has also been expressed as to
whether a work could have dual copyright protection
i.e., as an artistic work and a literary work.45 However,
for a while, it seemed that layout designs on
PCBs could indeed be protected under English
copyright law. This was placed in serious doubt
following the leading case of Mackie Designs v
Behringer Studio Equipment UK Ltd.46
In Mackie Designs, Pumfrey J was faced with the
issue that layout designs on PCBs ought to be protected
under designs law rather than copyright law. The
Copyright, Designs and Patents Act 1988 (CDPA),
provides that there is a defence to an infringement of
copyright action if protection for the subject matter in
question should be sought under the designs law
(Section 51). Thus, copyright protection should not be
available to what can be described as ordinary
functional commercial articles whose design is
intended to be given a shorter term of protection under
designs law than under copyright protection. The
Mackie Designs case held that this is the effect of
Section 51 of CDPA and this principle applies to all
industrially produced articles including PCBs.
Although Lambretta Clothing Co v Teddy Smith Ltd47
suggested that copyright protection could still subsist in
certain aspects of a design drawing, where a PCB is
concerned, it would still be difficult to argue for any
extent of artistic copyright protection as a PCB was
essentially an industrial design which had to be taken
as a whole. Thus, protection for layout designs had to
be sought under designs law. It was argued in
Mackie Designs that as designs law intended to protect
the shape or configuration of articles, it did not cover
circuit diagrams that related more to lists and
arrangement of elements on the PCB.48 These lists and
arrangements could be protected as literary copyright.
Pumfrey J however, rejected the argument and held
that
circuit
diagrams
were
design
diagrams within the meaning of designs law. Although
this decision did not go so far as to decide on whether
design diagrams ceased to have any copyright
protection as a literary work, the de facto effect of this
decision
was
to
deprive
layout
designs
of copyright protection.
Mackie Designs showed that the policy objectives
surrounding copyright law in England moved closer to
those of other leading industrial nations, i.e.
differentiating between works of a utilitarian nature
and works of expression of a more aesthetic nature, so
that different forms and lengths of protection could be
given to either. This process followed from the
historical development of IP law which adopted a
categorization approach to different types of
subject matter for protection under different regimes of
statutory laws.49 Thus, the refinement of differentiating
utilitarian shapes and configuration for protection
under designs law, from works of expression in
copyright law, is historically consistent. However, it
may be argued that integration of various parts of IP
law may come about, as cases involving multicharacter works50 have highlighted the artificiality of
categorizing different parts of the work for protection
under different IP regimes, and there may be no holistic
IP perspective with regard to these works. Further, the
recent case of Lambretta Clothing seems to suggest in
obiter dicta that design rights and copyright protection
could subsist over different aspects of a work, though
they should not be totally overlapping, as Section 51 of
CDPA prohibits the total overlap.51 As PCBs are
usually found in electronic or electrical devices, and
there may be patent protection for the device, design
protection for the shape of the device; so what happens
to the protection of the PCB itself? Do the PCBs have
to conform to an existing category of IP law in order to
be protected, or will the law move towards
comprehensive protection for whole articles or
products? It may be desirable to consider a
comprehensive regime of industrial property protection
in the future, but as of now, it is argued that under the
dominant categorization approach in IP law, it is
possible to give layout designs on PCBs IP protection
as a category on its own, by creating a sui generis right
for layout designs.
SHEN: PROTECTING LAYOUT DESIGNS ON PRINTED CIRCUIT BOARDS
IP Protection under Patent Law
Can layout designs on PCBs be protected under
patent law? A patent is a highly desirable form of IP
right in terms of the monopoly conferred and a wide
range of computer technology covered.52 Since PCBs
are chiefly concerned with industrial function, is it
possible that the design is patentable so that PCB
manufacturers could have a monopoly over their
layout designs? A closer look at the parameters of the
patent regime suggests otherwise.
In major jurisdictions, such as the US, the UK and
Australia, novelty and inventive steps are necessary
criteria to satisfy before something may be patentable.
The novelty test determines whether the claimed
invention is patentable or not. In theory, ‘novelty’
means that an invention must be different from all
published articles, known techniques, and market
products. In practice, novelty is established by
applying a set of technical rules to determine if a
patent applicant was really the first to make the
invention. It is difficult for layout designs on a PCB to
be viewed as an invention, as it is usually just a
modification of the prior art. The chief difficulty for
PCBs to pass this test is that the differences between
two PCBs may be very minor from a technical
viewpoint, as the circuit designs may be quite similar.
This is notwithstanding the difference in effects and
performance of electrical devices in which PCBs are
used. Such applications of intellectual effort are more
akin to industrial design than invention. The layout of
the cells of a customized chip and their
interconnection may be the product of tremendous
hard work embodied as a mask work, but hardly
meets the standard of inventiveness in patent law.53
Patent law also requires the invention to be
non-obvious (35 USC §103, 1982). An invention will
only merit a patent if it is a significant enough
technical advance over the prior art.54 Like the test of
novelty, new layout designs on PCBs are usually not a
fundamental technical advance over the prior art. In
other words, the technical difference between the new
invention and prior art is not likely to be obvious. US
patent law stipulates a utility requirement that the
invention must be a new and useful process or
composition of the matter (35 USC §101, 1982).
There seems little doubt that the circuitry incorporated
in PCBs may be new and of useful industrial
application. Nevertheless, other criteria for
patentability of PCBs may be difficult to satisfy. The
reason why patent law does not cover layout designs
425
on PCBs seems to be that the level of innovation
provided by a layout design is below the threshold
that patent law protection requires. As mentioned
earlier, PCBs are usually component parts found in
electronic or electrical devices. Patent law, however,
is mainly tailored towards the protection of these
whole devices but not such constituent parts such as
PCBs within devices.
Further, the patent application system requires a
long time for searches and comparison with prior art
before an application may succeed. The layout
designs of PCBs have a very short lifespan and it is
likely that particular layouts may become obsolete
when the application is still pending. Thus, patent
protection, although comprehensive, is unlikely to be
suitable for layout designs on PCBs.
Many countries have a ‘petty patent’ or ‘utility
model’ system55 to protect and reward small
inventions such as functional improvement or useful
articles.56 Although a utility model is a registered
industrial property right which confers on its owner
exclusive protection for a technical invention, it is not
a desirable option for layout designs on PCBs for two
reasons. First, the invention still cannot easily meet
the tests of novelty57 due its low level of
inventiveness on account of the technical similarity
among PCBs. Second, the owner may be prevented
from actually making, using, or selling his own
invention if it overlaps with a related patent owned by
someone else. Given the technical similarities in
PCBs, reliance on a petty patent system is not
desirable for PCBs and it may be in the
manufacturer’s interests that the scope of patent law
does not cover PCBs.
IP Protection based on Design Rights
Design protection is intended for the industrial
designs of products which may have a relatively short
commercial lifespan and thus deserve a shorter period
of protection than copyright.
Industrial designs are protected in the US under
registration statutes largely based on rudimentary
patent law concepts.58 If an applicant submits certain
representations of a new and original design for an
article of manufacture, the law would grant a
monopoly over the design for a certain period.59 In the
EU and UK, there are two design protection regimes,
the registered and unregistered design regimes.
The registered design regimes generally provide for
the protection of designs that have novelty or
individual character.60 In the UK, the Registered
426
J INTELLEC PROP RIGHTS, SEPTEMBER 2013
Designs Act 1949 also requires designs to have eye
appeal and not to be dictated solely by function.61
The layout of the PCBs is unlikely to be regarded as
novel or individual in character as PCB layouts are
often similar and dictated solely by the different
functional variations the layouts are intended to
achieve. It can also hardly be said that layout designs
on PCBs have eye appeal. In fact, it is not intended to
have eye appeal as the layout serves particular
functions and technical purpose.62
Under the registered design regime, a design right
does not subsist in the features or configuration of an
article that is intended to be connected to another
article to enable it to function. Circuit layouts are
intended to be attached to a device in order for the
device to function. On the whole, it is unlikely that
layouts of PCBs would be regarded as falling within
the scope of the registered designs regime.63
The registered designs regime provides for a longer
period of protection than unregistered designs.64
However, as layout designs of PCBs generally have a
short commercial lifespan, it would be sufficient for
manufacturers’ purposes if protection could be sought
under unregistered designs. The next issue to consider
is whether the unregistered designs regime in Europe
and the UK offer layout designs of PCBs protection.
The EU’s unregistered design right is only available
for 3 years for designs that would qualify for the
registered regime. Thus, layouts may for the reasons
argued above, not meet the criteria in the EU.65
However, the UK unregistered design right is
meant for technical designs and is not intended to
only provide eye appeal (Part III, CDPA). The
unregistered design right is provided for in the CDPA,
and covers a wide range of technical product shapes.
As there is no requirement of eye appeal or aesthetic
quality, it may be argued that layouts of PCBs could
fall within the unregistered design regime and thus, be
protected in the UK as an unregistered design for 10
years. However, there may be several obstacles to
show that there is clear protection under the
unregistered designs regime.
First, the design must not be commonplace. It is
uncertain what this means, but this requirement could
be construed loosely as merely ‘not copied’. If so, any
originally produced layout design on a PCB, albeit
similar to another original layout, may not be denied
protection as such.66 However, protection under the
regime is excluded if the design is a ‘must-fit’ or
‘must-match’, i.e. that its shape or configuration is
totally dependent on its connection to another article
or the appearance of another article of which the
design forms an integral part. It is arguable if layouts
on PCBs would be caught by the ‘must-fit’ or ‘mustmatch’ exceptions as they are required to be
connected to the main complex product and thus, the
design may be dependent upon the connection to or
appearance of the main product.67
Moreover, the extent of protection of a layout on
PCBs as a design right would depend on what the
infringement means. Section 226 of the CDPA 1988
defines infringement as making articles to the design,
or making design diagrams in order to make articles,
such that the copying design is exactly or
substantially the same as the copied design. As far as
PCBs are concerned, design diagrams indicate the
existence of various components and circuits but they
do not define the layout per se. Thus, a person could
copy the diagram and yet produce a layout which
appears different from the first layout. Would this
amount to infringement? Case law68 seems to indicate
that the threshold for ‘substantial similarity’ is rather
high and thus, if a design taken as a whole does not
look similar to the eye, even if individual component
features may look similar, there is still no
infringement. There is every possibility that it would
be difficult for infringement actions to be mounted
successfully if a design diagram is copied but the new
layout looks different from the original layout. The
judgment of the eye criteria in design rights does not
satisfy the purpose of protecting the intellectual
efforts behind layout designs on PCBs.
The underlying problem with fitting layout designs
into the concept of ‘design’ in the unregistered design
regime is that the nature of intellectual effort applied
in layout designs is quite different from industrial
design of mass produced articles. The nature of the
intellectual effort in layout designs is a pure
application of engineering understanding, whereas the
intellectual effort in industrial design of commercial
products is for the purpose of marketing (i.e. in
distinguishing between brands and manufacturers of
the same types of products), even if it encompasses
application of engineering understanding. This is why
elements of designs law which seek to identify the
unifying characteristics of industrial designs do not
quite encompass the characteristics of layout designs
on PCBs. Thus, it may also be sounder to consider if
applications of engineering effort ought to be
protected under a new category of IP protection.
SHEN: PROTECTING LAYOUT DESIGNS ON PRINTED CIRCUIT BOARDS
The existing categories of IP protection do not
clearly protect layout designs on PCBs. And since
such protection is unsatisfactory, the author argues
that IP protection should be given to PCBs, and as
such can be in the form of a sui generis right, which
may be analogous to the sui generis protection given
to mask works on semi-conductors in many
jurisdictions. This would also be consistent with the
categorization tradition in the development of IP law.
Justification for a Sui Generis IP Protection
Regime for Layout Designs on PCBs
Analogy to Sui Generis Protection for Mask Works of
Semiconductors
Layout designs are the application of engineering
effort and discretion, upon study of circuit diagrams, to
the actual electrical layout on a circuit board. Such
layouts are a creation of intellectual effort, arguably no
different from putting pen onto paper to write a novel.
The unique nature of the application of intellectual
effort in creating layout designs has caused the US to
enact legislation to recognise a sui generis IP right
in the layout designs of semiconductor chips. The US
Semiconductor Chip Protection Act 1984, in the form
of an amendment to the Copyright Act, contains a
new Chapter 9 entitled ‘Protection of semiconductor
chip products’, which protects the original mask
works made for actual layouts fixed on the silicon
pieces found in ICs. Although PCBs are different
from ICs and may be simpler in layout or less
expensive to produce, the work done for laying out a
PCB and the work done in laying out an integrated
circuit, that is protected by the US legislation, are in
nature, rather similar. Both entail the application of
engineering effort and discretion in laying out various
circuits and components, no matter how minute, onto
a surface. In the case of semi-conductor chips, a
silicon surface is used, while in the case of PCBs, a
metallic board is used. Ignoring the complexities
involved in manufacturing an integrated circuit, the
key commonality between the PCB and the IC is that
their purposes are defined by the layouts found in
them, and such layouts are not generic. Every layout
may be unique depending on the application of
engineering effort and planning for the purposes
intended to be achieved. The US Congress
recognized that the nature of IP in a layout was
unique and did not fit easily into categories of
existing IP law and therefore created a sui generis IP
right for the protection of layouts in integrated
circuits.69
427
This protection has since been accorded in other
jurisdictions such as Australia that enacted the Circuit
Layouts Act 1989 for ICs, and is recognized by the
WTO as an IP right that deserves protection. The
TRIPS Agreement requires member States to provide
protection for independently created industrial designs
that are new or original.70 More importantly, the
TRIPS Agreement borrows from the IPIC Treaty in
establishing minimum standards for protection of
layout designs of ICs.71 According to Article 4 of the
TRIPS Agreement, ‘each Contracting Party shall be
free to implement its obligations under this Treaty
through a special law on layout designs on integrated
circuits or its law on copyright, patents, utility
models, industrial designs, unfair competition or any
other law or a combination of any of those laws.’
Although the TRIPS Agreement left the issue open as
to whether layout designs on semiconductor chips
could be protected under existing IP regimes or
needed a sui generis regime, most jurisdictions have
created a separate IP regime for layout designs.
However, the UK adopted a peculiar position by
enacting the Design Right (Semiconductor
Topographies) Regulations 1989 under the CDPA.
The protection of the pattern of layouts is accorded as
a design right and not a sui generis layout right as in
other jurisdictions. Although the scope of protection
is not unduly affected as reproduction of the layout is
prohibited, it remains a question as to whether the
concept of ‘design’ in the parent Act [Section 213(1),
CDPA] actually encompasses layout designs. This is
because unregistered designs cannot be totally
functional and layout designs could be products of
purely functional considerations.
The UK categorization of topography rights under
the designs regime is problematic. In many other
jurisdictions, it is recognized as a unique right and as
submitted here, rightly so. If layouts in ICs deserve
protection, then it is arguably anomalous that layouts
of PCBs, which are of the same type of, though not
necessarily the same degree or intensity of intellectual
effort, are not protected per se in any jurisdiction to
date. As discussed, current legal protection, if any, is
derived from copyright in circuit diagrams or design
rights. Why is there such an anomaly?
Before the passing of the Semiconductor Chip
Protection Act 1984, the semiconductor industry in
the US was fraught with financial trouble as it faced
stiff competition from the Japanese. The Act was the
effect of political lobbying in order to protect the
428
J INTELLEC PROP RIGHTS, SEPTEMBER 2013
interests of the US industry which had spent
tremendous money and effort in research and
development (R&D) in integrated circuits.72
Effectively, the protection of layout rights may
indirectly be a form of protection for the R&D
investment in ICs.73
The regulatory or legislative reason to
differentiating layout designs of ICs and PCBs lies in
the fact that a large number of countries have not
provided a separate law for layout designs of ICs but
achieve IP protection through copyright, patent, utility
model, industrial design or unfair competition law, or
any other law or combinations thereof. Neither the
TRIPS Agreement nor the IPIC Treaty secured a
globally uniform and separate regime for the IP
protection of ICs, the lesson of which justifies a call
for a sui generis regulatory regime for layout designs
of PCBs. There are some shortcomings in current
statutory protection offered to integrated circuits. For
instance, the current protection regime for
semiconductor chips in the US is a hybrid one. It has
some features of a patent law regime while filing with
the Register of copyrights, though not mandatory, is a
prerequisite to the jurisdiction of the federal courts in
a civil action. Further, the remedies for violations of
any mask work owner’s exclusive rights are similar to
those afforded for infringement of copyrights. The
owner is entitled to receive actual damages as well as
the infringer’s profits to the extent not already taken
into account in the computation of actual damages.
Statutory damages as well as injunctive relief are also
available (17 USC §911). This patent-plus-copyrighttype of hybrid regime, also available in the EU,74
appears confusing to jurists and practitioners. In
addition, due to the lack of a uniform regime, states
usually adopt the protection regime with some homemade features. In particular, some countries require
some form of registration in order for the protection to
be available while other countries require no
formalities.75 Having in place a sui generis and
uniform protection regime for layout designs of PCBs
can help avoid regulatory arbitrages and stimulate
technological innovation. Here, the availability of IP
protection for innovations resulting from investment
in R&D gives innovators and investors incentives and
means to finance and apply R&D.
Does this therefore, mean that protection of layout
efforts depends on the amount of expense in R&D
that has gone into the layout design? One should not
push the investment protection of investment
argument too far. This is because it would result in
justification for protection of intellectual effort where
much investment could be found, and otherwise, if
the level of investment is not high enough. It is
understandable that the higher the investment levels,
the greater the potential losses to an enterprise if piracy
occurs to cream off the profits that would otherwise be
used to recoup the investment. This would also create
an adverse climate for research and innovation which
would result in net social losses. However, the amount
of investment should not be used as a determining
factor for IP protection as it presents two problems.
First, where will the line be drawn? If a certain amount,
greater or smaller, is determined to deserve IP
protection or otherwise, it may result in rigid and
onerous arrangements in a corporation’s innovative
strategy, corporate finance options and accounting
aspects. Would a company be compelled only to
commit to large R&D projects and thus incur higher
expenditure and develop higher needs for corporate
finance, perhaps getting into higher indebtedness?
Would corporations indulge in creative accounting to
relate many varieties of expenditure to R&D in order to
boost the investment level for innovation? Second,
investments in any industry may be an uncertain and
fluctuating phenomenon, and the amount of investment
in any industry should not be used as a determinant
factor to justify IP protection. Further, this would
create a climate for more and open lobbying for IP
protection and allow the development of IP law to be
determined more by political pressure than principled
reasoning and sound analysis. Finally, granting IP
protection for new technological or engineering efforts
where there are large investments would operate as a
disincentive for the smaller enterprises which do not
attract that much investment, from developing
innovative engineering or technological works that
may deserve sui generis IP protection. Thus, favouring
industries with large investments would create an
unhealthy discrimination that would result in social
losses to a large extent, and would further marginalize
the small and medium sized enterprises.
Many manufacturers of PCBs do not attract as
much investment as manufacturers of ICs. This is
because ICs are designed to perform complex
functions and are usually found in complex devices
such as personal computers while PCBs may be made
for the simplest electrical device such as the
calculator. There is also not one concentrated industry
for PCBs which may explain the lack of concentrated
SHEN: PROTECTING LAYOUT DESIGNS ON PRINTED CIRCUIT BOARDS
lobbying effort in the US. However, apart from the
realities of the political process, it is important to
recognize the principles behind giving PCBs IP
protection. The jurisprudential and economic
justification for granting layout designs on PCBs a
sui generis IP right, are elaborated below.
429
The degree to which IP protection should be granted
would be examined in the light of the economic
justifications for granting such protection.
Locke’s theory is a basic framework on which the
grant of IP protection may be justified but who should
be entitled to what scope of protection is usually
determined by more rational economic principles.
Jurisprudential Justification
The jurisprudential justification of everyone having
a right over the labour of his own body is widely
accepted and is the structural rule that determines
what kind of IP rights may be created.76
Although the application of engineering efforts
and discretion to layouts on PCBs is the application
of labour to matter that would produce an
industrial product, Locke’s labour theory would
justify proprietary protection for these intellectual
efforts as they are as much in nature, a labour of
one’s own body as effort expended pursuant to
the aesthetic and non-profit. Furthermore, there is
also the recognition that IP rules are designed to
reflect the wrongness of allowing one person to take
over and reap another’s rewards from the other’s
intellectual or marketing efforts.65
However, there is the danger of bringing Locke’s
theory too far. One is that whether Locke’s theory
could justify intellectual protection over any
miniscule application of labour.77 Excessive
protection may result in rent-seeking and exploitation.
This may be particularly true as the beneficiaries of IP
privileges are often private corporations and are
motivated by profit-making. The concentration of
rights in the hands of private corporations may create
an inequitable balance of interests and an over
distribution of rights into the hands of private
corporations. It has been particularly argued that
today’s IP protection has gone too far and
overcompensated the commissioners of intellectual
effort rather than protect actual individual creators
and users who add to the intellectual efforts by
incorporating their own.78 As far as PCBs are
concerned, it is clear that engineering effort is needed
to put a layout together, and whether the production
of the layout is for individual or industrial
exploitation, it would seem that IP protection would
be in the spirit of the jurisprudential justification. It is
the degree of IP protection that needs to be refined to
the extent that such protection would strike a balance
between freedom of information and exclusivity in
rights to exploit the fruit of one’s intellectual labour.
Law and Economics Principles Underlying IP Protection
The law and economics approach to justifying IP
protection of PCBs is that the conferment of
proprietary rights would incentivize innovation and
exploitation of innovation, so that the optimal value of
the intellectual effort could be harnessed in order to
maximize wealth for the individual, which, in Adam
Smith’s world, would result in maximization of
wealth for all in a free market.65 In modern terms, the
full exploitation of innovation would result in social
gains for everyone. It is noted that in absence of
copyright protection in the Elizabethan era, novelists
were not deterred from producing great works of
literary merit.
However, in this day and age, much intellectual
efforts go towards development of better and more
satisfactory commercial and industrial products, and
the entities undertaking the development of
innovations are generally private enterprises. Private
enterprises are motivated to engage in innovation and
development because of the potential rewards from
commercializing the end products. The motivation for
an author of a Victorian era novel is quite different in
nature from the profit motivation of private enterprises
engaged in R&D. IP protection would ensure that these
enterprises would be able to put these products into the
commercial market in return for a fair price that would
help recoup expenses in R&D. A perennial reason why
IP protection, as statutory intervention in the free
market, is needed is that consumers are not willing to
pay the average total cost of the knowledge product.79
Thus, without statutory intervention granting a form of
protection that will cause the price to be raised,
producers of IP would not be motivated to engage in
R&D for commercial purposes.
IP protection is particularly pressing for private
enterprises as there could have been much capital that
has been expended for such processes and piracy
would be much more damaging to an enterprise than
to a novelist in the Elizabethan times.80 Many private
enterprises are also accountable to capital suppliers
and are pressured to generate profits out of products
430
J INTELLEC PROP RIGHTS, SEPTEMBER 2013
which are the result of R&D. The intellectual effort
by private enterprises in innovation and development
is different in nature from personal intellectual effort
in writing a novel or creating a piece of art. The latter
frequently requires much less capital expenditure
compared to the investment capital needed today for
R&D. Thus intellectual effort today is very much tied
to investment expenditure into it, and there is a clear
demarcation between the investors and the producers
of the innovative efforts. With this demarcation, there
is often pressure from investors, whether corporate
shareholders, venture capitalists or the government
authorities, to ensure the success of the product,
which is measured by the profitability of the product
upon commercialization. Piracy would most certainly
undermine that profitability and success and would be
an immense threat to investors if the legal
infrastructure does not provide protection against it. If
the investment capital is reduced because of the
indifferent legal climate to piracy, private enterprise
innovation would be adversely affected.81
The arguments from the point of view of law and
economics would support protection for the
manufacturers of PCBs. Printed circuit boards are the
backbone of the electrical and electronic design of
many devices and innovation in industrial products for
commercial exploitation has always been led by private
enterprises for the objective of profit-making upon
successful commercial exploitation. One cannot doubt
the social benefits to consumers of better and more
improved electrical and electronic devices as modern
life and business activity are so heavily dependent on
them. The drive to improve or to innovate would be
severely impaired if externalities such as piracy
threaten the making of profits upon launch of these
products. Thus, for manufacturers of PCBs, IP
protection would be very important in fuelling further
R&D in order to result in better electrical or electronic
devices for consumer use. Piracy may allow consumers
to make a short term gain in lower prices for
comparable industrial products but the stemming of
innovative drive would prove to be a long term net
social loss for consumers. Therefore, regulatory
intervention should be secured to provide IP protection
to avert the possible externality and allow private
enterprises to continue turning out innovations and
improvements that would be socially beneficial.
In some areas of IP law, IP protection is not limited
to only preventing piracy. Patent law, for example,
grants monopolistic rights of exploitation, so that
partial appropriation of information for further use by
others would be a subject of infringement. The grant
of patent monopolies is an incentive to industrial
innovation. The protection of IP rights in the above
context is treated as the exercise of a policy decision
to prefer the commercial producers of information to
the non-commercial producers of information, which
would result in a systematic loss of personal
autonomy to appropriate information for private and
creative use.82 If one seeks to strike a balance in IP
laws so that IP laws protect the information goods in a
knowledge economy and yet retain a credible sphere
of public domain and permitting of fair use; it is often
in the utilization proprietary rights appropriately, and
providing for limitations in the duration of protection,
and providing for defences to actions for IP
infringements and forms of compulsory licensing.
As far as PCBs are concerned, it is perhaps
unrealistic to grant a patent type of monopoly over
layout designs as the justification for a monopoly
often requires lengthy investigatory processes on the
part of the regulator to ensure its uniqueness. Layout
designs in PCBs often have a short lifespan.
Monopoly rights are also not appropriate as layout
designs may be produced similarly by the independent
efforts of different people and are intended to be used
for different electrical or electronic devices. It may
thus be over-protectionist to grant monopolies over
layout designs. It is proposed here that layout designs
in PCBs may be granted a sui generis type of IP
protection, in order to protect the entire layout from
being copied, similar to the type of protection granted
to layout designs of ICs in the US, and proposed in
TRIPS. A generous reverse engineering defence is
also proposed so that it allows others to study the
layout and perhaps produce improvisations and
improvements to the layout. This is similar to the
scope of protection found in the US legislation
protecting layout designs of integrated circuits. In this
way, the investment and innovative efforts behind the
production of the PCBs could be safeguarded but
users of the information contained in the layout could
become creators of other layouts and such
improvements would result in a net social gain while
protecting manufacturers from piracy.
Some quantitative research in the US has sought to
draw a correlative link between investment in R&D
and level of economic growth. The findings suggest
that more economic growth is found where
investment in research and innovation take place. As
SHEN: PROTECTING LAYOUT DESIGNS ON PRINTED CIRCUIT BOARDS
R&D activities are motivated by sufficient intellectual
protection for the resulting knowledge products, IP
protection for efforts in R&D would be a right step in
the promotion of national economic wellbeing.83 A
comprehensive and strong IP protection regime
allows for private enterprises to engage in aggressive
R&D that benefits domestic economies on the whole,
by improving products for export and shifting the
balance of payments positions.84 Some quantitative
research has also pointed towards the observation that
the level of IP protection itself bears a direct
correlation to private investment stimulation whether
domestic or in terms of foreign direct investment
(FDI), which in turn affects the economic
development of a country.85 On a more microscopic
level, the protection of creators of IP ensures their
economic survival and employment at a fair return.
On the other hand, as PCBs are used in a variety of
electrical and electronic devices, from the simplest
low-end types to complex and sophisticated devices,
there are many types of manufacturers and a large
spectrum of investment weightage in each particular
case. Where the amount of capital needed for a
particular type of PCB is not significant, piracy may
not have that much of a devastating effect as the
profit margins may be small anyway and such
manufacturers may move on to a variation of layout
easily so that the exercise of their own initiatives
would suffice to combat piracy. If that is the case, the
cost of protecting such layouts may be too prohibitive
for the regulator as registrations would probably have
a very short life and may not need enforcement of
protection. In this case, it is proposed that a system of
protection for layouts of PCBs should be open to be
opted in- i.e. that manufacturers who do not wish
to take advantage of the protection may on their
own accord do so.86
It is noteworthy that many manufacturers of
PCBs may be multinational companies with
many businesses, which set up factories for
production of these boards in less developed
jurisdictions. As such, since IP protection is to
a large extent territorial, home protection would not
be useful unless recognition is given by the other
country. Such less developed jurisdictions may have
vested interests not to protect the PCBs of foreign
developers as local copies could provide a source of
import substitution and help in elevating standards of
living where it may not be possible because of
prohibitively expensive imports.
431
There are general arguments against protection of
the economic interests of creators of IP where it may
result in monopolistic behaviour and adversely affect
competition which is a social good.87 However,
conferring IP protection does not necessarily mean
conferment of monopoly status.88 IP protection could
be extended in a way so as not to prevent similar
products with different intellectual efforts applied to
them from competing in the market so that consumers
could still benefit from competitive prices.89 In the
case of PCBs, one could take a cue from the scope of
protection given to ICs and see that competition is not
stifled. Integrated circuit layouts are protected as to
the entire layout and copying would be infringement.
However, independent efforts arriving at the same
layout or similar layout would not be infringement
and a generous reverse engineering defence that
allows reverse engineering on existing integrated
circuits so that improvements or enhancements could
be made would not be infringement as well. Such a
scope of protection would seek to prevent piracy and
encourage innovation.90
Another objection to granting IP protection would
be the excessive control over information in the
public domain. A balance of interests has to be struck
because only when some information is in the public
domain can all access it and ‘stand on the shoulders of
a giant in order to see farther than the giant himself.’80
Thus, excessive protection of IP would severely
restrict the amount of information in the public
domain which can be appropriated for use for the
benefit of all.91 Many IP regimes have developed
exceptions and defences in order to strike the balance,
and compulsory licensing legislation to prevent
monopolistic use.92 Where layouts of ICs are
concerned, the scope of protection itself, i.e. the entire
layout only and not parts thereof, and a generous
reverse engineering defence have sought to strike a
balance. A similar extent of protection would be
appropriate for PCBs.93
It has been commented that information is by its
nature capable of generating more and other
information due to human ingenuity in understanding,
application and interpretation.94 Thus, IP protection
regimes would not imprison or suppress information.
In fact, with the controls exerted by IP regimes,
information generation could be paced in such a
manner so that its growth in the public domain could
be subject to flexible or structured arrangements and
not be out of control.95 An example would be
432
J INTELLEC PROP RIGHTS, SEPTEMBER 2013
information expressly dedicated to the public domain,
such as open source software, which delineates
the exact scope of public rights of appropriation.
As far as PCBs are concerned, controlling the
flow of information regarding layouts for electrical
functions through legislation conferring sui generis
IP rights for layout designs is also desirable as such
controls would encourage innovative effort and
reverse engineering instead of mere copying and
mass-production for quick profits.
Special Considerations with respect to China
An issue that arises in particular when considering
PCBs is that much of the manufacturing of PCBs for
electrical devices designed by big multinational
names actually takes place in many developing
jurisdictions such as China where cost of labour and
land may be less. As such, the intellectual content of
the layout flows to these jurisdictions and may be
susceptible to piracy, especially for use by the
domestic industries and acts as a form of import
substitution. China could argue that piracy should be
treated differently as pirated items may be limited to
the domestic market and does not affect the
manufacturer’s export business, and that it cannot
afford to pay the high premiums for those goods
whose cost of intellectual R&D may be passed on in
consumer prices.96 The potential deprivation of China
of advances in technology or innovation due to its
relative poverty is a strong argument indeed for
looking into whether IP protection, which protects
manufacturer’s profits by protecting the results of
their intellectual labour, could be modified for China.
Some manufacturers adopt an approach to
categorize different batches of the same product for
different markets, using different packaging or labels.
The products intended for the Chinese markets may
be cheaper than their counterparts intended for the
more developed countries. However, manufacturers
face the additional problem of finding that cheaper
parallel imports often find their way into the markets
that are not designated for them, and IP protection
does not extend to protection of distributorships in
various markets.
It is doubtful that China may benefit from having
laxer IP regimes even if that may seem beneficial to
the domestic market in the short run. This is because
China could lose out on long term FDI and transfer of
intellectual knowledge. Private enterprises need good
legal infrastructures, predictable legal regimes and
political stability to induce them to invest. Thus,
maintaining sufficiently stringent IP laws is
necessary to ensure that FDI stays. Such FDI is
necessary for the transfer of knowledge to China,
and only when such knowledge is transferred can
China be helped along in their advancement. As
already pointed out, ‘weak IP institutions discourage
technology-intensive, knowledge-rich FDI, licence,
and trade from the industrial countries to the
developing countries.’97
WTO has also adopted a similar philosophy as it
regards the harmonization of IP laws in different
jurisdictions, towards higher standards, as being
necessary to facilitate freer trade and capital flows.
Thus, with the impetus of trade facilitation, IP laws
are on the path of convergence98 for many
jurisdictions, and it is unlikely that China would be
able to maintain an independent stand.99 Although the
TRIPs Agreement does not yet contain IP protection
for layout designs of PCBs, it may be argued that as
IC layouts have been granted recognition for
protection, it may be a matter of time before layout
designs are given sui generis rights as a form of IP.
The problems of piracy in China may also prompt
manufacturers of PCBs to seek greater protection over
layout designs per se. Protection for PCBs would
allow more FDI into China which can grow on the
backbone of industrial development that is facilitated
by the presence of foreign manufacturers, and bring
about greater economic wellbeing and greater
advancement in knowledge, which, when the time is
ripe, may be further improved by Chinese scientists
and innovators using their own intellectual effort. The
transfer of knowledge to China also facilitates the
growth of knowledge elites in China.
One may argue that in the short run, only the
better-off in China may be able to enjoy the more
advanced products because of the higher price, and
the less well-off would not even be able to buy
cheaper imitations from a pirate competitor in order to
advance their own welfare. In the Cancun round of
trade negotiations, it was agreed that certain drugs
could be produced cheaply under compulsory
licensing of the relevant patents, by developing
jurisdictions so that they can be more widely available
at a cheaper rate in order to combat the AIDS crisis in
Africa.100 It is worth noting that the concession to IP
protection in this case was fuelled by a grave human
need that was so pressing that IP rights ought to give
way. The same kind of pressing need cannot be
SHEN: PROTECTING LAYOUT DESIGNS ON PRINTED CIRCUIT BOARDS
argued for appropriation of industrial knowledge to
make cheap pirated copies of electrical devices.
In addition, the lack of IP protection is a
slippery slope for China. China’s lack of a sound
IP protection infrastructure would pose as an indirect
encouragement for domestic piracy activities for short
term consumer gains. However, this may adversely
affect the development of knowledge elites in the
economy. Knowledge talent may migrate to other
jurisdictions where the IP protection is stronger. The
procrastination in adopting a sound IP infrastructure
may cause losses of domestic innovative talent, in
addition to a potential loss of FDI. What may be
gained in the short run is heavily outweighed by the
gains in the long run. It has been widely recognized
that there is a strong correlation between technology
and economic growth.101 Nevertheless, knowledge
without systematic protection is worse because
innovation will be retarded. This is also the case in
relation to China that the development of IP rights is
closely related to the development of trade and FDI102
since high piracy rates at between 85 and 93 per cent
across all sectors in China103 seriously discourage
FDI. Stronger IP protection, based on the economic
theories of the incentives to invest,104 disclose105 and
innovate,106 give more confidence to foreign investors
by improving their financial performance and
competitiveness so as to boost FDI into China.
Conclusion
The IP laws of many jurisdictions and the
TRIPS Agreement do not currently provide IP
protection for layout designs of PCBs. This article
presents arguments in favour of protection of layout
designs of PCBs as an independent sui generis right.
The author has shown how in various cases,
protection is sought under analogical reasoning in
copyright or design law. However, these existing
categories do not quite extend their coverage to layout
design rights, and with the recognition of layout
design rights in ICs in the US, Australia and in
TRIPS, it is time that layout design rights be
recognized as a sui generis right for PCBs in more
countries including China. Various arguments have
also been made from a jurisprudential and economic
view as to why layout design rights are appropriate
subject matter for IP protection, and why although
there may be arguments in favour of developing
jurisdictions to keep layout design rights for PCBs
outside the fold of IP protection, instituting protection
433
would be in the long run, a benefit to these
jurisdictions and that the problems faced by these
jurisdictions are not eradicated by less IP protection
per se.
Arguing for a sui generis protection for layout
designs of PCBs may trigger concerns over the
potential effect of such a separate regime since sui
generis protection is usually ineffective given the fact
that cases filed for legal protections in some countries
such as China and the US have been relatively limited.
There are domestic and international dimensions to this
concern. Internationally, there is a lack of mutual
recognition between the states for works of foreign
origin. For example, the US statutes provide that
protection in the US for works of foreign origin would
not be available unless the country of which the author
or owner is a national, granted equivalent rights in that
country to works that originated in the US. Similarly,
the EU Directive left to the discretion to the Member
States the determination of ownership of topography
rights where the semiconductor product is designed by
an employee, and the Member States must also decide
whether or not to extend protection to works which
have not been created by national or habitual residents
of the Member States. Other regional efforts to
coordinate efforts in this field have materialized. The
Association of South East Asian Nations merely
referred to extension of cooperation to layout designs
of ICs without offering any concrete plans.107 The IPIC
Treaty’s failure to come into effect left this problem
unsolved. This again reiterates the necessity to have a
uniform protection regime not only in each home
country but also at the international level.
Domestically, registration with the competent
authority establishes a presumption that a mask work
is protected. The significance of this requirement is
that (i) whether a layout design meets the relevant
standards for protection is a matter that is left for the
market to resolve through civil litigation following
registration; and (ii) it places the burden of proof on a
party challenging the entitlement to protection
[17 USC §908(f)]. In addition to legal costs and
procedural hassles, satisfying the burden of proof
poses a great legal and technical challenge. The pace
of technological developments also affects patterns
and behaviour of IP infringements. The development
of the semiconductor industry is so fast that copying
layout designs from someone else does not help
infringers survive the competition in the
marketplace.108 This is also the case for IC
J INTELLEC PROP RIGHTS, SEPTEMBER 2013
434
registration. In 2012, for example, there were
1.648 million trademark registration applications
but only 1,778 registration applications for ICs.109
The technical reason for this is that registered ICs
soon become less valuable to both owners and
infringers. One may argue that instead of spending so
much on filing for protection of ICs, it may be more
sensible to maintain the competitive edge by
developing newer ICs. This, while questioning the
effectiveness of legislative IP protection, still does not
justify leaving out regulatory or legislative protection
in this area altogether.
In summary, this article advocates protection to be
granted to layout designs of PCBs for the sake of
legitimate and righteous safeguard, and is of the view
that the scope of such protection could achieve a
satisfactory balance between the interests of
protecting the innovative efforts and investment
behind the manufacture of PCBs and the interests of
the general public in competition, consumer
protection and fair use of information. IP protection
given to layout designs in PCBs, as this article has
argued, would not unduly affect developing countries’
interests. These arguments are certainly relevant to
China, its telecommunications sector, and more
importantly, its technological developments and
innovations in a long run. To compromise on the
development of international IP protection in order
to solve symptomatic problems in developing
jurisdictions is not an apt solution.
5
6
7
8
9
10
Acknowledgement
The author thanks Zhang Jieying, Li Xianteng,
Jin Jie and Miao Jin for their research assistance on
Chinese law issues herein. The author also thanks
Shanghai Education Commission for a research grant
under the Eastern Scholarship Scheme, and Shanghai Jiao
Tong University for financial aid under the International
Cooperation Program (Grant No.: 2012-1.5.3.22).
References
1
2
3
4
PCBs are more correctly referred to as printed wiring board
or etched wiring board.
Article 2(i) of the IPIC Treaty; Article 2(1) of the PRC
Regulations on the Protection of Layout Designs of
Integrated Circuits.
Prior to PCBs, components were connected together with
wires, in a scheme called ‘point-to-point’ wiring. It was
messy and unreliable when compared to PCBs.
Article 2(ii) of the IPIC Treaty; Article 2(2) of the PRC
Regulations on the Protection of Layout Designs of
Integrated Circuits.
11
12
13
In terms of IP law, it is reasonable to assume that
configuration means the relative arrangement of parts of an
article. Although, configuration is not just another way of
expressing shape, the difference between configuration and
shape has long puzzled both judges and practitioners, Jacob
L J in Lambretta Clothing Co Ltd v Teddy Smith (UK) Ltd
[2005] RPC 88.
Zhang Jialiang, Global PCB manufacturing capacity is
moving to Mainland China with a market share of 16% in
2016, China Electronics Newspaper (in Chinese), 20 April
2012, p. 10.
Li Xiaolan, News from the CPCA Conference in Shanghai
2012, Futongban Bullets (in Chinese), issue 2, 2012. The
figures here are calculated according to the central parity rate
of Renminbi against US dollar set by the People’s Bank of
China on 8 March 2013 at the rate of US$ 1 = RMB 6.2719,
http://www.pbc.gov.cn/publish/zhengcehuobisi/637/2013/20
130308092011785919470/20130308092011785919470_.html
(8 March 2013).
Countries meeting in Washington DC in 1989 adopted a
Treaty on the Protection of IP in Respect of Integrated Circuits
(the IPIC Treaty) prepared under the auspices of the World
Intellectual Property Organization. However, opposition from
the US and Japan, the world’s two largest producers of
integrated circuits, doomed the IPIC Treaty to failure.
The State Intellectual Property Office (SIPO), whose duty is
to oversee the overall planning and coordination of
international IP matters, on 18 September 2001 issued the
Regulations for the Protection of Layout Designs of
Integrated Circuits Implementing Rules, which came into
effect on 1 October 2004.
Applicants for a layout design right must comply with
detailed rules and submission requirements, including
providing sample ICs. Rights in the layout design of an
integrated circuit only become valid when they have been
registered with SIPO. SIPO will refuse to register the layout
design if the right in respect of a layout design has not been
applied for within two years of that layout design having
been put into commercial use anywhere in the world. An
application for a layout design may be rejected if the layout
design does not meet the relevant statutory definitions for an
‘integrated circuit’ or ‘layout design’. SIPO may
compulsorily license a layout design right to third parties
without the holder’s consent where it is for non-commercial
public use. It can also grant a compulsory licence where the
holder has been found to have engaged in unfair competition
by the court or a government authority, Provisions for the
Protection of the Layout Design of Integrated Circuits 2001
and the Implementing Rules for the Provisions for the
Protection of the Layout Design of Integrated Circuits 2001.
The Copyright Law was enacted in 1991 and amended in
2002 to bring into closer harmony with TRIPS and the Berne
Convention. While it is structurally similar to copyright laws
in most other countries in the world, the drafting is more
general and flexible.
http://www.chinaipr.gov.cn/guidescopyarticle/guides/civilla
w/civilfaq/200701/240595_1.html (8 March 2013).
Foreign copyright owners can take advantage of copyright
laws as long as they satisfy certain requirements. For
instance, the work must be first published in China, the
author must be a national or a resident in a jurisdiction which
SHEN: PROTECTING LAYOUT DESIGNS ON PRINTED CIRCUIT BOARDS
14
15
16
17
18
19
20
21
22
23
24
25
has gained an international treaty or agreement to which
China is a signatory, Article 2, Copyright Law.
Article 52 in the PRC Copyright Law 1991 prescribed that:
‘The term ‘reproduction’ as used in this Law shall mean the
act of producing one or more copies of a work by printing,
photocopying, copying, lithographing, making a sound
recording or video recording, duplicating a recording, or
duplicating a photographic work, or by other means. The
term ‘reproduction’ as used in this Law shall not cover the
construction or the manufacture of industrial products on the
basis of drawings of engineering designs and product
designs, and descriptions thereof”. This article then explicitly
precluded the construction or the manufacture of industrial
products under the PRC Copyright Law. However, Article 52
was taken away in the new version of the Copyright Law.
The right of reproduction is now defined in Article 10(5) of
the new Copyright Law, which reads that ‘the right of
reproduction, that is, the right to produce one or more copies
of a work by printing, photocopying, lithographing, making a
sound recording or video recording, duplicating a recording,
or duplicating a photographic work, or by other means.’
Article 2, PRC Patent Law. The Patent Law was enacted in
1991, amended in 2000 to bring the law into closer
conformity with TRIPS, and was further amended in 2008.
Article 2, Regulations for the Implementation of China’s
Patent Law.
Article 2, PRC Anti-Unfair Competition Law,. This definition
lacks practical value; also Article 10bis, the Paris Convention.
Article 10, PRC Anti-Unfair Competition Law. Business
secrets are defined as ‘undisclosed technical or business
information that is unknown to the public and may be used
for economic gain, and is of practical value and for which the
rightful party has adopted measures to maintain its
confidentiality’.
Article 12(2) of PRC Anti-Unfair Competition Law
providing that reverse engineering means to obtain the
related technical information on the products in technical
methods by way of disassembling, mapping or analysing the
products gotten from public channels.
Article 12(1) of Interpretation of the Supreme People’s Court
on Some Matters Concerning the Application of Law in the
Trial of Civil Cases Involving Unfair Competition providing
that obtaining business secrets through development and
research by reverse engineering shall not be ascertained as an
infringement upon business secrets.
People’s Court Cases Collection (People’s Court Publisher
2008) (in Chinese) 327.
Seventy or 95 years from first publication in the case of
entity authors, or 120 years from the year of creation,
whichever occurs first. The duration of copyright protection
has evolved generally moving in the direction of a longer
term of protection.
Aubrey Max Sandman v Panasonic UK Ltd and Matsushita
Electric Industrial Co Ltd, 21 January 1998 (unreported).
It is not intended to provide a full scale of survey concerning
copyright protection of PCBs. Instead, only several major
industrial countries (including common and civil law
jurisdictions cross Europe, America and Asia) are selected in
terms of the reputable levels of copyright protection they have.
Mazer v Stein, 347 US 201, 98 L. Ed. 630, 74 S. Ct. 460
(1954). In the UK, however, copyright protection had been
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
435
given to utilitarian works of designs before the law of
designs gained ground.
British Leyland Motor Corporation Ltd & Anor v Armstrong
Patents Co Ltd & Anor [1986] A.C. 577.
Novel and inventive industrially produced articles, which are
utilitarian in purpose and character, even if artistically made
or ornamented, can be protected by patent law in the US.
Section 53, 17 USCA (1927).
A preliminary review of the copyright records conducted
online to check whether a PCB has ever been copyrighted in
the US Copyright Office did not yield any results.
Two cases that followed this approach are SA Parlux v SA
Maroquinerie Hirsch, a decision of the Tribunal of Paris
dated 15 May 1990 and the decision of the Cour de Cassation
(French Supreme Court) in Ets Quinson and Les Grands
Chais de France v Roland Chateau, dated 17 July 2001.
In Germany, copyright would generally subsist in a drawing.
Silberdistel, 22 June 1995, German Federal Court of Justice;
Explosionszeichnung, 28 February 1991, German Federal
Court of Justice; Brombeer-Muster, 27 January 1983,
German Federal Court of Justice.
The relevant German copyright provision is Article 2 of the
German Copyright Act, which defines ‘protected works’ as:
(1) Protected literary, scientific and artistic works shall
include, in particular:
1. works of language, such as writings, speeches and
computer programs; …
2. works of fine art, including works of architecture
and of applied art and plans for such works; …
3. illustrations of a scientific or technical nature, such
as drawings, plans, maps, sketches, tables and
three-dimensional representations.
(2) Personal intellectual creations alone shall constitute
works within the meaning of this Law.
Teruo Doi, International Intellectual Property Law of Japan
(Sijthoff & Noordhoff, Alphen aan den Rijn, The
Netherlands), 1980.
Shinobu v Kobata, Fukushima District Court, 9 April 1991.
Tanaka Sekkei v Himi Suisan Kakogyo Kyodo Kumiai, Osaka
District Court, 23 February 1979.
Dai Nippon Insatsu v Takwbayashi Shoji, Tokyo High Court,
17 December 1991.
It refers to art created with the primary purpose of expressing
beauty as a subject of artistic appreciation.
It is worth noting that the English Courts have never decided
that copyright subsists in the PCBs themselves. Rather, the
issues have been (i) whether or not copyright subsists in the
drawings used in designing the PCBs; and (ii) whether by
copying the PCBs itself, copyright in the circuit drawing
used in the design of the PCBs has been infringed.
However, a commentator argues that artistic works should gain
protection on the basis on its artistic character, as based on the
context of whether such works are created against the social
background of the art world. This would provide a coherent
characterization of artistic works instead of the list approach in
legislation which represents a collection of works termed as
artistic works without a central unifying characterization. This
reasoning would also exclude most utilitarian works from
‘artistic works’, including engineering drawings, Booton
David, Framing pictures: Defining art in UK Copyright Law,
Intellectual Property Quarterly, 1 (2003) 38.
436
J INTELLEC PROP RIGHTS, SEPTEMBER 2013
41 Anacon in Aubrey Max Sandman v Panasonic UK Ltd and
Maisushita Electric Industrial Co Ltd, 21 January 1998
(unreported).
42 The UK copyright system was unique in extending protection
in a two-dimensional drawing to its three-dimensional
counterpart, LB Plastics v Swish [1979] RPC, 551.
43 Anacon Corporation Limited v Environmental Research
Technology Limited and Anor Unreported, Ch.D, 21 April
1994 (which equated the information derived from the
original copyright work with the work itself).
44 Hall Susan, Multimedia- Does Anacon provide a route to
future protection, Entertainment Law Review, 5 (1994) 191.
45 Electronic Techniques (Anglia) Ltd v Critchley Components
Ltd [1997] FSR 401; Anacon in Aubrey Max Sandman v
Panasonic UK Ltd and Maisushita Electric Industrial Co
Ltd, 21 January 1998 (unreported).
46 Mackie Designs v Behringer Studio Equipment UK Ltd
(1999) 22 (7) IPD 22069 (Ch D).
47 Lambretta Clothing Co v Teddy Smith Ltd [2005] RPC, 6.
48 It was thought that the holding in Anacon giving circuit
diagrams the status of literary works, i.e. in the list of
notations, would provide an argument excepting from
designs law circuit diagrams, which deal with ‘shape and
configuration’,
Anacon
Corporation
Limited
v
Environmental Research Technology Limited and Anor
Unreported, Ch.D, 21 April 1994 (which equated the
information derived from the original copyright work with
the work itself).
49 The crystallization of IP categories began as early as the
1830s and it became well established that the different
categories of IP were to be treated differently with the
entrenchment of statutes dealing with these different
categories of IP separately; Sherman Brad & Bentley Lionel,
The Making of Modern Intellectual Property Law
(Cambridge University Press), 1999, Chapters 5 and 6.
50 Especially multi-media works, Stamatoudi Irini A, Copyright
and Multimedia Products: A Comparative Analysis
(Cambridge University Press), 2002; Reiling Ron,
Intellectual property regimes for the information age:
Policies of the United States, the European Union and the
World Intellectual Property Organization, Boston University
Journal of Science and Technology Law, 3 (Spring) (1997) 1,
where it is highlighted that one of the difficulties of
protection of multi-media works is that different components
of the work are subject to different rights and licences.
51 Case comments by Mallinson Roland & Young Clare,
Industrial plagiarism and the gap in design protection,
European Intellectual Property Review, 27 (2005) 68.
52 According to the UK Patents Act 1977, computer technology
which provides new or improved features may be protected
by patent by drafting claims to ‘a computer system or
apparatus including means for performing the new or
improved feature.’
53 The techniques adopted in fabricating and manufacturing
circuits may be protected by the patent system.
54 Section 3, UK Patents Act 1977; Haberman v Jackal [1999]
FSR 683.
55 The ‘petty patent’ or utility model is without prejudice to any
laws relating to design rights, other distinctive signs,
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
copyright, patents, typefaces, topography of semi-conductor
products, civil liability or unfair competition; EU’s amended
proposal of 25 June 1999 COM (99) 309 final.
EU does not have a Europe-wide system of protection and
the UK, Luxembourg and Sweden do not at present have a
system of utility model protection. See the Reform of the
Law relating to Copyright, Designs and Performers’
Protection, Cmnd 8302 (the 1981 Green Paper); U
Suthersanen, A brief tour of utility model law, European
Intellectual Property Review, 20 (2) (1998) 44.
In addition to novelty, non-obviousness and usefulness are
necessary requisites for the grant of the petty patent; 35
United States Code, Sections 102 and 103. Novelty is judged
based on the prior art as of the date of invention. See also the
EU’s proposed Directive on the Protection of Utility Models.
The US Design Patent Act 35 USC §§ 171-73 authorizes
design patents for anyone who ‘invents any new, original and
ornamental design for an article of manufacture,’ subject to
other provisions of the Patent Act.
The TRIPS Agreement provides that the owner of a protected
industrial design shall have the right to prevent third parties
from making, selling, or importing articles bearing or
embodying the design for at least ten years.
Articles 5-7 of the European Designs Directive.
Section 1C(1), and Articles 9-10 of the Community Designs
Regulations.
Valeo Vision Societe Anonyme & Anor v Flexible Lamps
Limited (Patents Court, 24 June 1994).
Valeo Vision Societe Anonyme & Anor v Flexible Lamps
Limited (Patents Court, 24 June 1994), it was held that the
parts of a design that are not exclusively dependent on mustmatch criteria could be protected as a registered design.
The protection for registered designs is 25 years while
unregistered designs are protected for 10 years.
Cornish William R and Llewellyn David, Intellectual
Property: Patents, Copyrights, Trademarks and Allied
Rights, 5th edn (Sweet & Maxwell, London), 2003, para 1-40
& 14-30.
This is arguable though. Spavin Robert, The absence of
effective UK protection for non-European designs under the
CDPA 1988, European Intellectual Property Review, 22 (1)
(2000) 30.
The must-fit exception was argued in Ocular Sciences Ltd v
Aspen Vision Care Ltd [1997] RPC 289 and Parker v Tidball
[1997] FSR 680.
C&H Engineering v Klucznik [1992] FSR 421, Guild v
Eskander [2003] FSR 23, though Guild did not decide on the
point of substantial similarity, as the court found that the
judge in the lower court had used the wrong articles for
comparison to determine substantial similarity, and thus had
to overturn the judgment.
Before this, Intel tried to argue for protection of topography
rights in layouts of integrated circuits based on copyright.
Intel tried to register topographies with the Copyright Office
but the application was rejected. Samuelson Pamela and
Scotchmer Suzanne, The law and economics of reverse
engineering, Yale Law Journal, 111 (7) (2002) 1575 at 1599.
The requirement that the design be ‘independently created’ is
taken from both copyright and design laws. Dinwoodie
SHEN: PROTECTING LAYOUT DESIGNS ON PRINTED CIRCUIT BOARDS
71
72
73
74
75
76
77
78
79
Graeme, Federalized functionalism: The future of design
protection in the European Union, American Intellectual
Property Law Association Quarterly Journal, 24 (1996) 611.
Articles 35-38. Through being incorporated into the TRIPS
Agreement, a number of provisions from the IPIC Treaty
have become binding on WTO Members.
Burk Dan L, Tailoring patent policy to specific
industries, The Sixth Annual Honourable Helen
Wilson Nies Memorial Lecture, Paper 11 (2003)
http://scholarship.law.marquette.edu/nies_lectures/11/
(8 March 2013).
The rationale for protecting semiconductor chips although
they are not patentable is to give a period of exclusivity for
enterprises to recoup their investment costs. The recouping
of investment expenses could be undermined severely if the
exclusivity is not conferred, Burchfiel Kenneth J, The
constitutional intellectual property power: Progress of useful
arts and the legal protection of semiconductor technology,
Santa Clara Law Review, 28 (3) (1988) 473, 536.
Directive 87/54/EEC; OJ 1987 L/24/36.
Among the EU members, the requirements are diverse, e.g.,
the UK, Sweden and Belgium require no formalities while
Spain and Italy required registration as well as a compulsory
marking with a suitable symbol.
Locke’s theory of labour, Spector Horacio M, An outline of a
theory justifying intellectual and industrial property rights,
European Intellectual Property Rights, 8 (1989) 270.
Early cases in England confronted with the protection of
publishers’ rights illustrated how the early judges wrestled
with notions of proprietary enjoyment of one’s mental labour
and the scope and duration of such protection. There seems
to be a form of almost commonsensical consensus on some
form of IP protection and the controversies lie more in the
extent of such than the existence of such. Sherman Brad and
Bentley Lionel, The Making of Modern Intellectual Property
Law (Cambridge University Press) 1999, Chapter 1.
Siva Vaidhyanathan, Copyrights and copywrongs: The rise
of intellectual property and how it threatens creativity (New
York University Press, New York), 2001; Ghosh Shubha,
The merits of ownership, Harvard Journal of Law and
Technology, 15 (2) (2002) 453 in which Vaidhyanathan’s
book was reviewed.
New knowledge works are usually created at a low cost from
an old work, and yet, producers need to be able to sell at
average total cost in order to make a profit, but consumers
are not willing to pay above marginal cost which is lower
than average total cost, Easterbrook Frank H, Who decides
the extent of rights in intellectual property?, in Expanding the
Boundaries of Intellectual Property: Innovation Policy for
the Knowledge Society, edited by Rochelle Dreyfuss, Diane
L Zimmerman and Harry First (Oxford University Press),
2001, Chapter 16, p. 406.
80 Long Doris E, First, let’s kill all the intellectual property
lawyers! Musings on the decline and fall of the intellectual
property empire, John Marshall Law Review, 34 (2001) 851,
footnote 71.
81 Vaidhyanathan argues that concentration of privileges in the
hands of private enterprises may stifle creativity as IP may
provide overcompensation of rent and stifle the creativity of
those who could stand on the shoulders of preceding
82
83
84
85
86
87
88
89
437
innovation to create enhancements and further developments,
Siva Vaidhyanathan, Copyrights and copywrongs: The rise
of intellectual property and how it threatens creativity (New
York University Press, New York), 2001. Ghosh argues that
IP protection functions as a stimulant to innovation because
it acts as a subsidy, in which case tax advantages to reward
innovative companies would suffice and could arguably
replace the incentives represented by IP protection, Ghosh
Shubha, The merits of ownership, Harvard Journal of Law
and Technology, 15 (2) (2002) 453.
Benkler Yochai, A political economy of the public domain:
Markets in information goods versus the marketplace of
ideas, in Expanding the Boundaries of Intellectual Property:
Innovation Policy for the Knowledge Society, edited by
Rochelle Dreyfuss, Diane L Zimmerman and Harry First
(Oxford University Press), 2001, Chapter 11, p. 274 and 286.
Kieff F Scott, Property rights and property rules for
commercialising inventions, Minnesota Law Review,
85 (2001) 697.
Arai Hisamitsu, Intellectual property policies for the twentyfirst century: The Japanese experience in wealth creation,
1999, quoted in Long Doris E, First, let’s kill all the
intellectual property lawyers! Musings on the decline and fall
of the intellectual property empire, John Marshall Law
Review, 34 (2001) 851, footnote 71.
Sherwood Robert M, Intellectual property systems and
investment stimulation: The rating of systems in eighteen
developing countries, IDEA: The Journal of Law &
Technology, 37 (2) (1997) 261.
It has been argued that for developing countries which may
not fully provide for topography protection for layout designs
of integrated circuits, protection should be afforded
automatically and there should be no need for registration,
Kukkonen Carl A, The need to abolish registration for
integrated circuit topographies under TRIPs, IDEA: The
Journal of Law & Technology, 38 (1) (1997) 105.
Cornish details the arguments against monopolistic behaviour,
such as artificial price propping which results in a
misallocation of resources, a redistribution of wealth in favour
of the monopolist which results in social injustice, and long
term social losses as the monopolist would also not have the
incentive to innovate, having faced no competition to drive
him on, Cornish William R and Llewellyn David, Intellectual
Property: Patents, Copyrights, Trademarks and Allied Rights,
5th edn (Sweet & Maxwell, London), 2003, para 1-44.
The real repugnance lies in the tying arrangements that
manufacturers make with others in order to prevent other
similar products from competing, US v Microsoft Corp, 1998
WL 614485. There is a distinction between the proprietary
protection of IP and tying arrangements that are anticompetitive, DeSanti Susan & Cohen William, Competition
to innovate: Strategies and proper antitrust assessments, in
Expanding the Boundaries of Intellectual Property:
Innovation Policy for the Knowledge Society, edited by
Rochelle Dreyfuss, Diane L Zimmerman and Harry First
(Oxford University Press), 2001.
Berkler opines that the more monopolistic forms of
protection would result in a long run decline in innovation
because commercial entities which have been granted IP
protection would be likely to dig back into its inventory of
used information in order to generate new information, so
438
90
91
92
93
94
95
96
97
J INTELLEC PROP RIGHTS, SEPTEMBER 2013
that the costs of getting information for input in its
innovation would be almost nil. Thus, this pattern of reliance
on no cost past information for innovation would undermine
innovation more than if information were more freely
available and there would be more possibilities in
appropriation of a wide variety of information for
improvement and innovation, Benkler Yochai, A political
economy of the public domain: Markets in information goods
versus the marketplace of ideas, in Expanding the
Boundaries of Intellectual Property: Innovation Policy for
the Knowledge Society, edited by Rochelle Dreyfuss,
Diane L Zimmerman and Harry First (Oxford University
Press), 2001, Chapter 11, 290.
However, see Farber Daniel A and McDonnell Brett H, Why
(and how) fairness matters at the IP/antitrust interface,
Minnesota Law Review, 87 (2003) 1817, where it is argued
that IP protection should be reconsidered in its scope in order
to shift more towards consumer surplus. This is because the
beneficiaries of IP protection are large multi-national
companies and not starving artists and thus, the maximization
of producer surplus is no longer that fair and more consumer
surplus should be created, in order to achieve a fair division of
the economic surplus created by the effect of IP protection.
Lessig Lawrence, The Future of Ideas: The Fate of the
Commons in a Connected World (Random House, New), 2001.
Azucuenaga Mary L, Recent issues in anti-trust and
intellectual property, Boston University Journal of Science
and Technology Law, 7 (1) (2001), in which it is argued that
the balance between anti-trust and IP protection is well
struck so far.
It has also been commented that a sui generis protection for the
semiconductors that has a broad reverse engineering defence
and a well-limited scope is not overbroad and shall protect
from undue piracy while enhancing and fortifying the public
domain, Kastenmeir Robert W & Remington Michael J, The
Semi-Conductor Chip Protection Act of 1984- A swamp or
firm ground, Minnesota Law Review, 70 (1985) 417.
Wagner R Polk, Information wants to be free- Intellectual
property and the mythologies of control, Columbia Law
Review, 103 (4) (2003) 995.
An example of chaos would be the collapse of the Licensing
Presses Act 1662, resulting in the Statute of Anne in 1709
giving copyright grants to authors of works.
http://
www.iprcommission.org/graphic/documents/
final_report.htm (13 May 2013), quoted in foonote 11,
F M ’t Hoen Ellen, The responsibility of research universities
to promote access to essential medicines, Yale Journal of
Health Policy, Law and Ethics, 3 (Summer 2003) 293.
Ryan Michael P, Knowledge economy elites, the
international law of intellectual property, trade and economic
98
99
100
101
102
103
104
105
106
107
108
109
development, Cardozo Journal of International and
Comparative Law, 10 (1) (2002) 271 at 300.
This is not by any means easy, Gervais Daniel J, The
internationalisation of intellectual property - Some
challenges from the very old and the very new, Fordham
Intellectual Property, Media and Entertainment Law
Journal, 12 (4) (2002) 929.
This is severely criticized by Howard Anawalt in his article,
International intellectual property, progress and the rule of law,
Santa Clara Computer and High Technology Law Journal,
19 (2) (2003) 383. Anawalt opines that the WTO being an
international body is not accountable to national peoples and
therefore should not impose IP regimes that interfere with
domestic freedoms to property and access. Critique is also
directed against American dominance in the WTO IP agenda
as the protection would serve American corporate interests but
the agenda does not contain a balanced assessment of how
developing jurisdictions may be affected.
Symptomatic relief, The Economist, September 2003.
Jorgenson Dale W, Information technology and the US
economy, American Economic Review, 91 (2) (2000) 1-32.
Ya Qin Julia, Trade, investment and beyond: The impact of
WTO accession on China’s legal system, in China’s Legal
System: New Developments, New Challenges, edited by
Donald C Clarke, (Cambridge University Press, Cambridge),
2007, p. 166, 179.
Porter Pitman B, China and the international legal system:
Challenges of participation, in China’s Legal System: New
Developments, New Challenges, edited by Donald C Clarke
(Cambridge University Press, Cambridge), 2007, p. 145, 152.
Demsetz Harold, Toward a theory of property rights,
American Economic Review 57 (2) (1967) 347, 348, 359
asserting that the primary function of property rights
is that of guiding incentives to achieve a greater
internalization of externalities.
The theory posits that the prospect of a property right
will induce inventors to seek IP protection, and thereby
disclose their inventions in accordance with IP law’s
disclosure requirements.
Schumpeter Joseph, Capitalism, Socialism, and Democracy
(Routledge, London and New York), 1950, p. 81-110.
Article 3(1), ASEAN Framework Agreement on
Intellectual Property Cooperation (signed on 15 December
1995); Heath Christopher, Intellectual Property Law in
Asia (Kluwer Law International, London, The Hague and
Boston), 2003, p. 259.
Guo He, A commentary on the layout design protection of
integrated circuits in China, Intellectual Property (in
Chinese), Issue 1 (2005).
Report of China Intellectual Property Protection
(in Chinese), 2012.