Do your homework, Chinese officials tell Ottawa tech companies

Mark
Mark Brownlee
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Chinese officials tried to allay concerns Tuesday about intellectual property protection for Ottawa companies as economic development officials formally announced a new organization designed to export local technology to Asia.

Invest Ottawa president and CEO Bruce Lazenby, left, and Zhongguancun Development Group general manager Qiang Xu sign an agreement to establish a Chinese incubation centre in Ottawa.

Zhongguancun Development Group, a state-owned enterprise founded by the municipal government of Beijing, will spend $10 million to create a local “incubation centre.” This is designed to give local companies a chance to sell their technology to firms in China.

The announcement comes amidst increasing concern on the part of Canadian firms that they’ll enter the Chinese market only to have the technology they’ve spent years developing stolen from them once they arrive.

However Chinese officials believe it’s also up to local companies to do their research ahead of time so they know what they’re getting into.

“When the Canadian companies make an investment in China, they need to have a well-prepared (plan) of how to protect their intellectual property rights,” said Qiming Wang, a science and technology counsellor with the Chinese embassy in Ottawa.

“Sometimes they find problems because they don’t get well-prepared before they go into China.”

An important component of this involves knowing what to do when an intellectual property problem comes up, he said, including knowing whether or not it’s necessary to go to court.

This represents a chance for China to overcome a reputation it developed when it didn’t do as much to protect intellectual property rights, said the head of Ottawa’s lead economic development agency.

“The reality is that China has some baggage from the days when they did not protect intellectual property,” said Invest Ottawa president and CEO Bruce Lazenby. “We know now they’re working hard to try and change that reputation and this is an opportunity for them to do that.”

He encouraged the companies that decide to do business in China to perform their due diligence before taking their technology overseas.

Mr. Wang insisted there’s another side to the coin, however, since Chinese companies regularly express concern about being treated equally when they open shop in Canada.

He cited misunderstandings about state-owned enterprises as an example. They should be looked upon as companies, he said, rather than as direct offshoots of governments.

Concerns about Chinese state-owned enterprises purchasing Canadian companies were raised during the China National Offshore Oil Co.'s bid for Calgary-based Nexen and led to new federal rules governing such takeovers.

The local branch of the world-wide organization will consist of a Chinese director and three locally-hired staff, Zhongguancun said in a news release. They will initially work out of the Invest Ottawa offices close to Preston Street but hope to eventually move to a bigger space.

Zhongguancun has already met with seven companies during their day-and-a-half of operation, Mr. Lazenby said.

Organizations: Zhongguancun

Geographic location: Ottawa, China, Beijing Preston Street

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  • Kevin Szabo
    December 14, 2012 - 19:52

    It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat. [Man in the Arena, Theodore Roosevelt] Thank you to folks who are trying to make a difference by creating organizations such as Invest Ottawa.

  • Andrew Rees
    December 12, 2012 - 10:38

    Granted, established companies are at risk of loosing control of their intellectual property in jurisdictions like China. Even Cisco, for example, settled a lawsuit with Huawei in 2004 over what they believed to be theft of their intellectual property. That said, I believe the issue of intellectual property protection begins at the 'ah ha' moment and if we expect foreign nations to respect our intellectual property abroad, we must hold ourselves to the same standard and insure the protection of inventors at home. How many of us have witnessed investments [particularly VC investments] in relatively well validated [me too] ideas over more innovative, less well validated ideas followed by the resulting new business laying claim to the more innovative ideas themselves and simply because the offended parties can't justify [afford] a legal battle with them. Oh those bad bad Chinese! How about us bad bad Canadians? Some Canadians to be more specific, not to suggest this doesn't happen elsewhere in the World. Perhaps the solution is for Invest Ottawa, along with some of our local intellectual property law firms, to run regular Boot Camps for aspiring entrepreneurs… so they will be armed with the requisite knowledge to protect their intellectual property before that 'ah ha' moment. Thoughts?

    • Anonytron
      December 12, 2012 - 12:10

      Why do all your ideas lead back to Invest Ottawa being in the picture? Do you work or have interest with Invest Ottawa? It seem to be a far stretch. Also, you seem to be justifying china's ruthless theft of everyone's property by bringing up our bad apples here in Canada? It seems foolish to compare the amount of intellectual property canadians steal compared to china... Maybe Invest Ottawa should open an office in China and relocate? INvest China.

    • Hartman
      December 12, 2012 - 13:33

      Agree with ANONYTRON ... Mr. Rees' consistent references to/endorsements of Invest Ottawa makes me wonder of his affiliation with this organization or Mr. Lazenby. To the point of the Zhongguancun International Incubation Center to be established in Ottawa. Here's a verbatim quote from the Beijing Zhongguancun International Incubator Inc. website about the purpose of these incubators. Infer your own conclusions: "... [the Beijing Zhongguancun International Incubator Inc.] does its best to create an excellent business environment by way of effective all-round incubation services to lure back a growing number of students and assist them in starting businesses. Furthermore, it aims at promoting the commercialization of research results and bringing up first- class technology-based firms and brilliant entrepreneurs. In addition, it takes full advantage of the achievements made by overseas hi-tech firms in order to enhance the comprehensive strength of technology and upgrade its level in the Zhongguancun area." Source: http://www.china.com.cn/market/member/398824.htm

    • Andrew Rees
      December 12, 2012 - 14:26

      @anonytron, @hartman, as a stakeholder, I'm proud to say I'm an advocate of Invest Ottawa [and economic development in general] but, I'm, by no means, a pom pom wielding cheerleader! Perhaps you didn't read this earlier post of mine... "Some very prestigious members of the new Board of Directors for sure... the Mayor, Presidents of our local academic institutions, private enterprises and other economic development organizations, a veritable 'who's who' in Ottawa. That said, hopefully, this new Board comprehends 'its' prestige [as a body], in the eyes 'its' Stakeholders [the citizens of Ottawa], will be a function of Invest Ottawa delivering on its mission "to make Ottawa the best place in Canada to start and grow a knowledge-based business" and more tangibly delivering on a list of specific, measurable, attainable, relevant, time-bound [and well communicated] objectives... you [the new Board] are charged with the efficient and effective use of 'our' tax dollars towards this end. Jeff Westeinde said it best at the launch of Invest Ottawa... "we" [the Board representing the interests of the Stakeholders] "expect great things from Invest Ottawa". So as a Stakeholder, I say a huge 'thank you' to the new Board for assuming this 'huge' responsibility on our behalf [and in such challenging times]. I also say I'm looking forward to your first report at the next Annual General Meeting.". Thanks for giving me the excuse to repost this!

  • jac
    December 12, 2012 - 07:17

    never in a million years would I do business with china... its well known to be a cut and paste shop... byebye IP. sure you get cheap labor, but at the expense of loosing your rights to your product... we're too dumb to realize that here in canada.. gullible fools and naive china is a very very smart country with a strategy. we, fly by the seat of our pants.

  • Anonytron
    December 11, 2012 - 22:22

    Anyone who does business with Zhongguancun Development Group or Invest Ottawa is a fool, and deserves to loose their intellectual property. China is the biggest offender in the whole world when it comes to stealing electronic designs and software, and they have now made it easier to steal from us by setting up show in our own back yard. Anyone with half a brain knows we anyone already has full access to china's markets, without INvest Ottawa needing to take the credit. We are indeed surrounded by fools.

  • Doug Reichenhowzer
    December 11, 2012 - 18:03

    Invest Ottawa must have run out of meetinngs in Ottawa, now they're trying to waste the Chinese's time. Be honest and just rebrand yourself "Invest Meetings".