The Commissioning Party's Use of Copyrighted Works in China

Website: www.haiwen-law.com

Designs, logos and other artistic works may be created for various purposes. For example, an entity may engage a design firm to design a stylized word for the purpose of its use as a trademark; a publisher may commission a production company to design various pictures or drawings for use in its monthly magazine; a hotel may request an artist to create its name plate in Chinese calligraphy; an international company may entrust an advertising firm to sponsor a TV show to be aired by a local TV station to promote its brand awareness.

In these situations, invariably there are questions of who owns the copyrighted works created and who has the right and on what terms to use such copyrighted works during the term of the agreement and beyond.

In most situations, a contract is signed between the relevant parties for the use of copyrighted works. The contract may be in the form of a 'commissioning contract', an 'entrustment contract', an 'agency agreement', or simply a 'cooperation contract' in the Chinese context. In a recent advertising sponsorship contract established between a Beijing-based subsidiary of an international media company (party B) and a local TV station (party A) for the purpose of sponsoring a Chinese cuisine program, the two parties entered into an agreement for sponsorship and production of programs specifying, among other things, that since the programs are entrusted by party A to party B, all copyright in the programs shall be owned jointly by the two parties. If either party A or party B wishes to re-air the programs on other channels, or wishes to permit others to air the programs, it shall obtain the prior consent of the other party.

In some other situations, whether a contract exists or not needs to be determined based on the facts of the case. This was an issue in a recent case with the Guangxi High People's Court, where the appellants included a Chinese cigarette company, which owns the trademark 'Zhen Long' (真龙), or 'Real Dragon', for its cigarette products. The appellant lost its first instance case with an artist who created an advertisement line consisting of the words '天高几许问真龙', meaning literally