China cannot crackdown on counterfeits – 90 percent of Chinese shops have counterfeits

When a local government in Shenyang, China announced a crackdown on counterfeit goods, nintey percent of store owners responded by shutting down, .

This event has grave implications for the future of copyright/counterfeit/patent reform in China.

China can't crackdown on counterfeit goods without putting most stores out of business.

Local authorities clearly learned this lesson, as seen in what they did next. The Shenyang authorities  to the store closures and announced that they were not conducting a crackdown and asked stores to reopen.

This  pretty much sums up the state response:

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Here's a literal translation::

"NOTICE:

On the previous stage, cooperating with the 2012 special event of cracking down on counterfeit goods held by Shenyang Municipal Government has now come to an end. According to an emergency meeting held on August 6th by the Municipal Government, all inspection on the marketplace will now be stopped, in hope of all vendors to resume normal business. If any non-local public security department requests for inspection, they must be escorted by the local police. Otherwise vendors can call 110 to report it as a crime."

While to an outsider that may sound like a sternly worded warning to those selling fakes, its actually the opposite — By ensuring that the inspections of fake-selling shops must be either held by local police or arranged by local police, Shenyang knows they can carefully stage-mange the inspections so nothing changes.

The notice even goes as far as saying any inspections held by an outside body should be reported, as those inspectors are committing a crime!