Have you ever wondered how shanzhai products in China are near exact replicas of the original? ‘Shanzhai’, meaning fake copy of something, seems to be inevitable in China where nearly everything is made here. If things are going to made here, the Chinese people have to know how to make it. Mixing together factors of access to designs, a culture of corruption and quick money and poorly enforced intellectual property rights, there’s no better place to make and sell fake stuff.

Rampant piracy of luxury goods to consumer electronics has lead to billions of dollars in losses for major brands.

A court in south China has jailed three people for stealing the design to Apple’s iPad 2 tablet computer and using it to manufacture counterfeits, state press said. The theft from a plant run by Foxconn (Apple manufacturer), late last year resulted in fake iPad 2 tablets being sold in China before Apple’s official launch of the product.

A court in Shenzhen city last week sentenced Xiao Chengsong, the legal agent of Maita Electronics, to 18 months in prison and fined him 150,000 yuan ($21,789) for buying the design from two Foxconn workers. Xiao allegedly paid 200,000 yuan for the iPad 2 design.

Foxconn employee Lin Kecheng, was sentenced to 14 months and fined 100,000 yuan, while another worker identified as Hou Pengna was given a two-year sentence suspended for one year and fined 30,000 yuan.

All three were convicted of the crime of violating commercial secrets.

So perhaps the only way to stop or at least dampen shanzhai products, is to stop making things in China. But that is a far fetched idea.

Jason Lim

Jason is an Australian born Chinese living in Beijing, specializing in entrepreneurship, start-ups and the investment eco-system in China, especially in the tech and social area.

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