4. Research questions and research hypotheses
As shown in the literature review, there is a lack of analysis on trademark in general, and consequently none for Hong Kong and Taiwan. Rather, much research has been conducted on China as a whole and on global counterfeit. Patents and copyright have garnered much attention and numerous studies, but trademark is generally left aside.
‧
國
立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
We aim to shed light where, to date, there has been none. We ask: what are the strategies that Hong Kong and Taiwan use to fight against counterfeit? To what extent may these different strategies be considered efficient and effective? What could be done to improve such legislation?
By comparing two specific events which occurred in these two different places we will tackle their current strategies, their policies, and their efficiency, as well as the areas which could be improved to finally institute a new comprehensive approach to trademark protection.
In summary:
1) What is trademark counterfeiting and why such an issue?
Through the trademark sub-category, we will illustrate the very concept of modern coun-terfeiting and its importance.
2) What are Hong Kong and Taiwan’s governments’ reactions to the problem?
We will use our two examples of seized goods in 2015 and 2018 and extrapolate to Hong Kong and Taiwan at national levels, and then detail the strategies both places use in their efforts to eradicate the phenomenon. Our two news items will serve as entry points to the strategies – through institutionalization and sociology of organizations – that both countries implemented.
3) What alternative for a more efficient and comprehensive strategy?
Finally, we will highlight which existing structures and organizations are the most effi-cient in fighting against infringed goods and consider what areas could be improved. This pro-cess will help us specify a more international and holistic approach to tackle the problem. We will use the EU as an example of a multinational system and draw parallels where possible.
!
5. Methodology
As with most research into illegal or criminal trafficking, we have an extremely limited amount of information to work with. Thus, quantitative methods or statistical analysis seems in-appropriate given core uncertainties about the legitimacy, veracity, and objective truth of the available data. Whereas Hong Kong gives a few numbers and attempts transparency, Taiwan gives no communication. We therefore chose to pursue a qualitative analysis.
‧
國
立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
Consequently, three points of view were possible: that of the traffickers, that of the brands, and finally that of the institutions. Obtaining information that is valid from the point of view of cri-minals is not only dangerous but also of questionable scientific quality. In other words, if mation directly given by criminals could be obtained, how could it be trusted? Obtaining infor-mation directly form brands is also almost impossible, but for different reasons: brands do not want to disclose that which could harm their brand or carry legal consequences. What informa-tion is available is more qualitative than quantitative. Moreover, the brand perspective is already well-represented in published research. Ergo, the institutional perspective is the most valuable contribution to the field: the information, although limited, can still be cross-checked against other sources such as official organizational publications and press articles. Although we expect the publications to carry bias – governments are strongly motivated to signal active work and progress – we can still glean from them institutional motives and draw comparisons between the two countries.
!
5.1. A Comparison between places and events
With this research, we may assess behavior in two different realms: the organizational and the strategic. We narrow our focus to Hong Kong and Taiwan, and then compare and contrast places, events – two seizures of counterfeit goods as reported by respective media, orga-nizations, and institutions. A coherent methodology thus requires some degree of consistency between the events and response; too much disparity in, say, chronology and nature would intro-duce too many obfuscating variables and differences. Therefore, these two specific places carry enough similarities to provide useful entry points for analysis.
!
5.1.1. Why these two articles?
The use of these two events are a matter of availability rather than choice. As mentioned previously, few sources are available and informational quality is low. Only events and cases that could be cross-checked would be suitable. In other words, as the institutions are generally
‧
國
立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
our main source of information, press articles are effectively the only other source of inde-pendent information on the work and role of institutions in practice.
Seizures are few, so their disclosure in the press is equally rare. Before settling on our cases, we attempted to gather as many reports on recent seizures as possible of comparable reporting quali-ty and characteristics. Yet, only these two cases stood out as sufficient to be emblematic and re-presentative. While we could have simply compiled a list of all cases regardless of quality, we believe this would be intellectually dishonest. Reported seizures do not transparently represent the traffic on the ground. Traffic must be incredibly well organized to be so pervasive, and the seizures represent only a tiny part of the true extent. Moreover, often seizures are not representa-tive of the traffic; the quality and quantity of goods discovered can differ considerably from what is available on the black market. In general, the goods found are not the best copies available; the best copies are better concealed and often pass into mainstream distribution channels unnoticed.
Furthermore, seizures are not always publicized. Often, they simply fade into an aggregate num-ber or percentage then reported by customs. Finally, the fragmented and disaggregated nature of modern online and social media makes compiling an exhaustive list of cases with suitable quality a fool’s errand. We therefore chose to focus on two emblematic cases of comparable quality and aspect to best illustrate the role, the advantages, the work, and the limits of the actors involved in the fight against counterfeiting. While possibly less ambitious in scope, this project compensates with intellectual honesty and depth.
For each selected case, we conducted as exhaustive a survey as possible with available reporting in order to select the article with the most complete and richest information. The articles around each subject are all available in the appendix.
!
5.1.2. Why are they comparable and to what extent?
As previously mentioned, we chose to ground our understanding of the issue through case study. We will consider as many details, facts, and generally types as appropriate and possible.
Each case will correspond to a research area. From there, we will examine each case by itself, as well as the subsequent response in each place. We expect that the responses, the strategies, the
‧
國
立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
institutions, and the policies mobilized and proper to each place are products of idiosyncratic lo-cal conditions. In other words, from similar facts we shall observe how lolo-cal variations yield dis-parate outcomes.
Our two cases cover recent events. For Hong Kong, we have a seizure of fake luxury goods in Admiralty worth HKD $1M from December 2015. For Taiwan, we have a seizure of fake goods, including copies of luxury products, worth NT $10M from January 2018. From these cases we shall examine the response of the different organizations at stake in the two locations, identify general themes where appropriate, and then recommend improvements. Because the cases are recent, we believe the data and response represent present conditions.
!
5.2. Two comparable places?
Is it reasonable to treat Hong Kong and Taiwan as comparable places, especially when there is no international consensus? Taiwan, whose constitutional name is the Republic of China, is only recognized by 18 states including the Holy See and must work constantly to maintain this small international representation. Though the island maintains relations with many states, the vast majority are relatively informal. These states recognize Taiwan as a province of China but not as an independent state. The People's Republic of China, for its part, claims sovereignty and will threaten or penalize countries that say otherwise. Since 2005, the Anti-Secession Law has clarified China's position on any Taiwan declaration of independence. Taiwan’s domestic gover-nance is, for all intents and purposes, not subject to any oversight by or interference from China, but its relationship with China prevents Taiwan from obtaining any official representation in IOs.
Thus, fewer countries recognize Taiwan, preferring its all-powerful neighbor. In our work, we position Taiwan as a space with sufficient autonomy and independence to follow its own model in political, economic, and legal terms.
Hong Kong is another particular space. From the retrocession of this former British protectorate in 1997, it has operated according to the principle of a single China, two systems. The goal was then to maintain a semblance of autonomy and freedom – particularly in terms of economy, jus-tice, and expression – for at least fifty years following the handover. These exceptions, plus its
‧
國
立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
quasi-democratic Parliament, allowed Hong Kong to present itself as an entity distinct from Chi-na, and to sign bilateral agreements with other states. These exchanges involved economic, fis-cal, and legal systems different from China, and allowed Hong Kong to establish itself as the fi-nancial center of Asia. However, recently China exerted more direct control over the city-state, thus violating the spirit of the original handover treaty. This changes not only the practical status of Hong Kong, but also the entire legal system already in place. Because most of our sources and our case study precede these recent changes, so we chose to regard Hong Kong as strong in its autonomy.
With these points in mind, our research treats these two spaces as two states, in that they are rela-tively independent entities, legally, politically, and economically. This is a methodological bias based on the facts as stated above and not the result of specific political demands. However, we will not forget their special relationship and connections to China. Indeed, all these parameters are essential to understand the states of counterfeit traffic in these places.
For these reasons, we chose to analyze Hong Kong and Taiwan together. Even though Taiwan is a larger state and more autonomous than its neighbor, their geographic proximity as well as their political ties with China naturally led us to regroup them. They also have to face similar issues in relation to customs and infringed goods with China and between each other. Thus, we compare these two different places together, employing small-N comparative methods. We shall thus fo-cus on exact processes and structures with qualitative methods and evidence. We shall examine the strategies and structures used and implemented by these places in response to this specific issue.
This type of study lends itself to heuristic analysis. In other words, we use induction and intuitive understandings of politics and society to explore deeper, complex processes and relationships.
Examination through case study offers opportunity to highlight differences between reality and theory, as well as structural and judicial factors.
Finally, a small-N comparison, especially ours, will better address case peculiarities without the pressure to over-generalize places that, though similar, still retain unique historical, political, and
‧
國
立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
social characteristics. Namely, though both maintain special ties with mainland China, such ties do not imply complete standardization and consistency between all three, nor can the ties them-selves be considered standardized.
!
Limitations
Even if comparison may be proper, naivete with respect to theory and reality is inexcu-sable. Hong Kong and Taiwan can be compared in that they are obviously geographically close, of different size but of a similar order of magnitude. However, Hong Kong is attached more di-rectly to its Chinese neighbor than Taiwan, which benefits from relative insularity. This is an im-portant detail, particularly for the distribution networks of goods. Also, Taiwan benefits from a relatively more established autonomy than its neighbor Hong Kong. In other words, and espe-cially since the re-election of Tsai Ying-Wen, Taiwan has turned away from China as its key partner while the People's Republic of China exerts even more naked authority over Hong Kong.
We expect our research will require future updates in order to reflect these new realities. Finally, with Hong Kong a city-state and Taiwan a detached island not recognized as a nation by most states, mixing and exchanges between locals and foreigners does not occur on the same scale, especially after the 2020 riots in Hong Kong and the coronavirus epidemic. Exchanges are signi-ficantly less than before.
!
5.3. How to compare them?
As John Stuart Mill explained in "A system of Logic", volume 1 (Mill 2011), "the sim-plest and most obvious modes of singling out from among the circumstances which precede or follow a phenomenon, those with which it is really connected by an invariable law, are two in number. One is, by comparing together different instances in which the phenomenon occurs. The other is by comparing instances in which the phenomenon does occur, with instances in other respects similar in which it does not. These two methods may be respectively denominated, the method of agreement, and the method of difference." Therefore, we will apply his method of dif-ference when comparing Hong Kong and Taiwan, where counterfeit flows are similar, but
reac-‧
國
立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
tions and treatment differ. The locations are comparable, and through our case studies we will point out the similarities in the presence of fake goods in each region. However, official res-ponse varies, and must stem from each region’s unique features. Using this method, we will later on acknowledge a crucial, determining factor for the outcomes one observes in one of the cases.
The method of difference provides stronger evidence for causal explanations and is specifically adapted for regional and area studies: Hong Kong and Taiwan have obvious similarities and thus qualify for this handling. Therefore, if the struggle against counterfeit appears more efficient in some locations than others, it follows that local response carries greater weight than ties with mainland China. Local socio-economic factors prevail.
To strengthen our methodology around comparison, we will go further than Mill and follow Adam Przeworski, and Henry Teune’s "The Logic of Comparative and Social Inquiry" (Prze-worski, Adam, and Teune 1970). More than just the method of difference, we will apply "Most Similar System Design", which shows how similar systems – for us, Hong Kong and Taiwan – can yield disparate outcomes. We will thus isolate significant factors for study and omit irrele-vant ones.
! !
5.4. How to choose them?
As Charles Ragin and Howard Becker stated in 1992 (Ragin and Becker 1992), “there is little consensus on what constitutes a case and the term is used broadly”. What matters is the
“limitation of attention to a particular instance of something”. For our purpose, cases are not chosen to render judgement on established theories, and thereby approve or reject them, but ra-ther to present cases that are indicative of the illicit trade and government response. In 1991, Mi-chael Burawoy (Burawoy 1992) and his colleagues theorized the extended case method as the purpose to discover flaws in and then modify existing social theories. They saw it as a way to rebuild or improve theory instead of approving or rejecting it. Consequently, we shall not render binary judgement on hypotheses, but rather find the limitations of the existing strategies and
‧
國
立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
build towards a coherent global model. From each case study we will examine local reactions, infer global trends, and identify opportunities for improvement.
We thus propose a multi-level analysis: at the institutional level on how and what strategies the different actors at stake implement, at the organizational level on what is at stake in the process, and then the efficiency of the whole system. Throughout, we must be mindful of the differing politics and realities. The juridical systems and institutions differ widely. Accordingly, reality may deviate from theory. Finally, let us recognize the limitations on observable fact: we only have two cases to study and only as external observers. We can thus proceed with illustration but should not pretend that our study is exhaustive. The cases shall rather be considered as samples of the underlying system, and so may we, with confidence, peek into areas that would remain otherwise unknown. At the very least, we may state the known unknowns and unknown unk-nowns (Danchev 2009, 188).
!
6. Significance of the research and limitations of the study