SHANGHAI, June 28 -- As China strengthens its commitment to protecting intellectual property rights (IPRs), multinational corporations are increasingly enthusiastic about investing in the country.

In April this year, the Shanghai Third Intermediate Court announced a landmark ruling, imposing a fine of 600 million yuan (about 84.2 million U.S. dollars) and sentencing five individuals to imprisonment for up to nine years for infringements of LEGO toy sets.

"We are extremely pleased with this conviction," said Robin Smith, vice president of the LEGO Group and general counsel for China and the Asia-Pacific region. Smith emphasized that the Chinese government's persistent and robust efforts in IPR protection and enforcement, exemplified by this case, are instrumental in fostering a level playing field for all businesses operating in China, including but not limited to the LEGO Group.

"In general, in comparison to other countries, I would say China is doing very well," said Smith, reflecting on his six years of working experience in Shanghai, overseeing the company's legal affairs across the Asia-Pacific.

The LEGO Group is not the sole beneficiary of China's enhanced IPR protection. "Robust IPR protection for innovative drug patents is crucial for the business environment and encourages multinational companies to invest more in China, bringing innovative medicines to the Chinese market alongside global releases," said Liu Hongqiang, vice president of intellectual property at Bayer (China) Ltd.

Liu highlighted the substantial investment of time and capital required to develop new pharmaceuticals, contrasting it with the minimal cost of imitation, thus making the selection of research and development (R&D) centers a cautious decision for multinational pharmaceutical firms.

China, particularly Shanghai's ongoing advancements in IPR protection, has bolstered Bayer's confidence. Earlier this year, the company's consumer health division pledged a 20 million euros (about 21 million U.S. dollars) investment to establish the China Center for Innovation & Partnership in Shanghai, according to Liu.

Shanghai's relentless improvements in IPR protection have significantly influenced the Britain-based firm Reckitt's decision to establish its latest Global R&D Centre of Excellence in the eastern Chinese metropolis.

On Tuesday, the company announced an investment of over 300 million yuan in the R&D center, marking a major milestone in its development in China and underscoring its enduring commitment to the country.

Spanning over 8,000 square meters, this new center will join the ranks of the company's nine global centers of excellence and is slated to become operational by 2026.

"If you are not delivering in China, you're not delivering in the world. If you're not in China, you can't deliver in 'China Speed,'" noted Arjun Purkayastha, senior vice president of Reckitt Greater China, adding that China is at the core of the company's long-term strategy, not just as a top market but also as an innovation hub.

Shanghai has instituted an IPR protection mechanism specifically for foreign-funded enterprises, aiming to build the city into a global IPR protection hub. According to the municipal intellectual property office, Shanghai is steadfast in providing equal protection for both domestic and international market entities, consistently enhancing the IPR protection system, and rigorously combating infringement and relevant illegal activities.

Over the past three years, Shanghai has addressed over 60 administrative rulings concerning foreign-related patent disputes and investigated and handled more than 1,000 cases of foreign-related trademark infringement.

The proportion of Chinese patent holders experiencing infringement remained relatively low at 6.7 percent in 2023, indicating an enhanced capability among patentees to defend their rights and the ongoing strengthening of IPR protection, according to the latest patent survey report released by the China National Intellectual Property Administration.

Data from the Ministry of Commerce indicates that the number of newly established foreign-invested enterprises in China increased by 19.2 percent year on year in the first four months of 2024, maintaining a robust growth trajectory. A total of 16,805 foreign-invested enterprises were established across the country during this period.