Chinese customs officials say import, export ban on iPad would be 'difficult'

Posted:
in iPad edited January 2014


Chinese customs authorities have indicated to Proview, the Chinese company that is locked with Apple over the iPad trademark in the country, that a ban on the importation and exportation of Apple's touchscreen tablet would be "difficult to implement" because of the popularity of the device in the region.



Proview Technology (Shenzhen) chairman Yang Long-san told Reuters on Wednesday that Chinese consumers' love of Apple products and the size of the market would make such a ban unwieldy. Lawyers for the company said on Tuesday that they had filed requests to block imports and exports of the iPad, a move that could grind worldwide sales of the device to a halt.



"The customs have told us that it will be difficult to implement a ban because many Chinese consumers love Apple products. The sheer size of the market is very big," Yang said.



He added that the company has applied to "some local customs" for the ban, but the local departments will need to report to their headquarters in Beijing.



Proview sued Apple over the iPad trademark in China last year, and Apple has had little success in fighting back. The iPad maker believes that it purchased the rights to the trademark in China years ago through a deal with Proview's Taiwanese division.



“We bought Proview’s world-wide rights to the iPad trademark in 10 different countries several years ago,” Apple spokeswoman Carolyn Wu said this week. “Proview refuses to honor their agreement with Apple in China.”



Proview has responded with a complicated argument asserting that a subsidiary in Shenzhen owned the China rights and was not present at the negotiations.











Yang went on to hint that an out-of-court settlement would be the best way to resolve the disagreement. However, Xie Xianghui, a lawyer for Proview, indicated earlier this week that the company had yet to make any proposals to Apple.



"We are now focusing our work on upholding rights and haven't made negotiation proposals to Apple yet. As for the reasons, you should ask Apple," said Xie.



The New York Times suggested on Tuesday that the threat of an import/export ban and recent seizures of iPad units in smaller Chinese cities can be taken as warnings from Proview of the "havoc it could wreak" should Apple continue to fight this legal battle. If that is indeed the case, then Yang's mention of an out-of-court settlement may be a public attempt by the company to bring Apple to the negotiating table.



Officials from China's Administration of Industry and Commerce seized 45 iPad units last week in Shijiazhuang, Hebei. Authorities in Xuzhou, a small city in Jiangsu Province, confiscated devices earlier this week, according to another Proview lawyer. Several Chinese retailers, including Amazon China, also appear to have halted sales of the iPad online, according to local magazine The Beijinger.





Chinese officials inspect iPad 2 units after confiscating them. | Credit: Hebei Youth Daily







A settlement from Apple could help Proview International Holdings, the parent company of Proview Technology (Shenzhen), reverse its current fate. The company is in danger of being de-listed from the Hong Kong stock exchange and has run into financial trouble in recent years.



[ View article on AppleInsider ]

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Comments

  • Reply 1 of 63
    sflocalsflocal Posts: 5,511member
    This rumor, if true, gives me a feeling that Proview's case is going to get flushed down the toilet.



    Popcorn in hand watching the events unfold!
  • Reply 2 of 63
    Apple should just send them a bill for 45 units. ...They may even qualify for a bulk discount.
  • Reply 3 of 63
    tofinotofino Posts: 697member
    Just change the name. Not that big of deal.



  • Reply 4 of 63
    blursdblursd Posts: 123member
    Notice the reasoning here. "We probably won't do it because it would be 'too difficult.'" Not "We won't do it because it complete bull@#$%."



    Proview claims they hold the trademark to the iPad name in China ... great. Apple owns the trademark everywhere else, so there's nothing illegal about producing iPads in China and exporting them to countries where Apple does own the trademark (this is sidestepping the issue of whether or not Proview actually has a legitimate claim to the China trademark of the term "iPad").



    If China were to ban the exportation of all iPads from the country over a domestic trademark dispute the backlash would be devastating. EVERY foreign company that has production in China would immediately start looking for alternate production facilities in friendly countries - which is a MAJOR source of China's economy and growth.



    China is ballsy when it come to stealing intellectual property and technology, but they're not suicidal - banning the exportation of the iPad would bring the world down on China, and China doesn't like being in the unfavorable spotlight.
  • Reply 5 of 63
    It very much looks like one subsidiary of Proview sold the rights to Apple, when the rights were owned by another subsidiary of Proview.



    In such a scenario, it seems logical that the 2 subsidiaries of Proview should slug it out in court - and maybe one of the subsidiaries owes a lot of money to the other. But that would really be left hand paying right hand - at a time when both hands are poor!



    Why deal with logic, when there is the rich hand of Apple, you have a very cooperative legal system! I have read that the Chinese legal system is impossible to navigate - but I guess that only applies to outsiders.



    I cannot even imagine that the Chinese legal system actually entertains such a lawsuit - let alone allowing units to be seized and considering an import/export ban on the iPad! Quite obviously, everyone has a stake in Proview's extortion game.



    This should a major lesson to all companies that insist on manufacturing in China. It makes tremendous sense to have some diversity - even if it comes at a much higher cost. For a company like Apple, this is a no brainer. Especially if it means they have enhanced production at a time when production is their number one constraint.



    Brazil is a good first step, but Apple should also look at other markets like Thailand, Indonesia, Malaysia, India, etc. And more importantly, Apple should look to diversify outside of Foxconn - what Proview did today, Foxconn could attempt tomorrow - and Foxconn is infinitely more connected in the establishment than Proview ever was.
  • Reply 6 of 63
    matrix07matrix07 Posts: 1,993member
    Quote:
    Originally Posted by macarena View Post


    And more importantly, Apple should look to diversify outside of Foxconn - what Proview did today, Foxconn could attempt tomorrow - and Foxconn is infinitely more connected in the establishment than Proview ever was.



    That's also my impression. Foxconn is more powerful than Proview ever be. It could turn back and bite Apple one day.
  • Reply 7 of 63
    Quote:
    Originally Posted by matrix07 View Post


    That's also my impression. Foxconn is more powerful than Proview ever be. It could turn back and bite Apple one day.



    Like Samsung... But Foxconn is a different kind of company than Samsung and I don't really foresee Foxconn trying to develop, manufacture and market their own-branded products.
  • Reply 8 of 63
    Quote:
    Originally Posted by macarena View Post


    It very much looks like one subsidiary of Proview sold the rights to Apple, when the rights were owned by another subsidiary of Proview.



    In such a scenario, it seems logical that the 2 subsidiaries of Proview should slug it out in court - and maybe one of the subsidiaries owes a lot of money to the other. But that would really be left hand paying right hand - at a time when both hands are poor!



    Why deal with logic, when there is the rich hand of Apple, you have a very cooperative legal system! I have read that the Chinese legal system is impossible to navigate - but I guess that only applies to outsiders.



    I cannot even imagine that the Chinese legal system actually entertains such a lawsuit - let alone allowing units to be seized and considering an import/export ban on the iPad! Quite obviously, everyone has a stake in Proview's extortion game.



    This should a major lesson to all companies that insist on manufacturing in China. It makes tremendous sense to have some diversity - even if it comes at a much higher cost. For a company like Apple, this is a no brainer. Especially if it means they have enhanced production at a time when production is their number one constraint.



    Brazil is a good first step, but Apple should also look at other markets like Thailand, Indonesia, Malaysia, India, etc. And more importantly, Apple should look to diversify outside of Foxconn - what Proview did today, Foxconn could attempt tomorrow - and Foxconn is infinitely more connected in the establishment than Proview ever was.



    Well summarized. Indeed alot of MNCs didn't learn their lessons until a hefty price-tag comes along.



    Putting everything in one basket, esp. China where nothing cannot be changed with the right 'negotiations' and 'connections'.



    Those who have done business deals in China will know...
  • Reply 9 of 63
    Questions:



    1. What does global Proview say about this issue? They know that they sold the name so why don't they ask the Chinese group to stand down?



    2. The iPad product that Proview supposedly makes, is that sold exclusively in China?





    Proview is skating on thin ice. If they don't invite all their subsidiaries to their international negotiations, that's their problem.

    Proview China is behaving like greedy Somali Pirates and should not be negotiated with.

    They are only causing problems for other Chinese retailers who will no doubt turn against them.



    Time will tell.
  • Reply 10 of 63
    gtrgtr Posts: 3,231member
    I like this bit.

    Quote:
    Originally Posted by AppleInsider View Post


    Yang went on to hint that an out-of-court settlement would be the best way to resolve the disagreement.



    "Give me my bribe, please"
  • Reply 11 of 63
    "The company is in danger of being de-listed from the Hong Kong stock exchange and has run into financial trouble in recent years" The last legal gasp of a dying company with no credibility looking

    for press of any kind.Apple will slice and dice all allegations with excellent legal representation in a

    court of law they have a fine stable of patent and trademark attorneys to protect intellectual property worldwide.They should acquire Interdidital(IDCC) to be even better at it.
  • Reply 12 of 63
    ajitmdajitmd Posts: 365member
    Quote:
    Originally Posted by macarena View Post


    It very much looks like one subsidiary of Proview sold the rights to Apple, when the rights were owned by another subsidiary of Proview.



    In such a scenario, it seems logical that the 2 subsidiaries of Proview should slug it out in court - and maybe one of the subsidiaries owes a lot of money to the other. But that would really be left hand paying right hand - at a time when both hands are poor!



    Why deal with logic, when there is the rich hand of Apple, you have a very cooperative legal system! I have read that the Chinese legal system is impossible to navigate - but I guess that only applies to outsiders.



    I cannot even imagine that the Chinese legal system actually entertains such a lawsuit - let alone allowing units to be seized and considering an import/export ban on the iPad! Quite obviously, everyone has a stake in Proview's extortion game.



    This should a major lesson to all companies that insist on manufacturing in China. It makes tremendous sense to have some diversity - even if it comes at a much higher cost. For a company like Apple, this is a no brainer. Especially if it means they have enhanced production at a time when production is their number one constraint.



    Brazil is a good first step, but Apple should also look at other markets like Thailand, Indonesia, Malaysia, India, etc. And more importantly, Apple should look to diversify outside of Foxconn - what Proview did today, Foxconn could attempt tomorrow - and Foxconn is infinitely more connected in the establishment than Proview ever was.



    Very true, Apple is a company with a market cap of $500B, including $100B in cash. All of this is vulnerable to a corrupt dictatorial regime and the companies it is involved with. The supply chain is optimized for profits and has few back-up plans and almost no margin of safety. There are all kind of risk like supply chain risks, political risks, natural upheavals, etc.



    Worse is the supply chain feeding the competition. The economies of scale paid by Apple can feed the competition like Samsung, Speaking of which, Apple is fighting them in court. Meanwhile, Apple single sources the A class of CPUs to them, buy their panels and even finances them. Duh!



    Strategically, Apple should have invested in the Good Ol' USA. Yes, it would have required a huge investment in automation, but economies of scale in automation would have been made for the cost of labor. Look, even Samsung is building a chip plant here in Texas. Instead of Samsung, how about IBM, TXN or even Intel (for a price). They have much more integrity and would unlikely to double cross Apple like Samsung did.
  • Reply 13 of 63
    Seems like a desperate "All in" kind of move!
  • Reply 14 of 63
    Quote:
    Originally Posted by alexkhan2000 View Post


    Like Samsung... But Foxconn is a different kind of company than Samsung and I don't really foresee Foxconn trying to develop, manufacture and market their own-branded products.



    The point is not whether Foxconn will ever make and market their own branded products. What if there is a dispute in the future? Foxconn, with all its foxconnections in the Chinese establishment will be able to really turn the screws into Apple. If Apple has Foxconn as their sole manufacturing partner, they would be well and truly f***ed if Foxconn turns against them. They need some buffer against this. And the only way is if Apple has other partners in other countries.
  • Reply 15 of 63
    Quote:
    Originally Posted by copeland View Post


    Seems like a desperate "All in" kind of move!



    Kind of... except that even their "All" is pretty insignificant. They are in even worse situation than Kodak was, when Kodak attempted their shakedown of Apple.



    But who knows what they can pull off in China!
  • Reply 16 of 63
    Quote:
    Originally Posted by macarena View Post


    The point is not whether Foxconn will ever make and market their own branded products. What if there is a dispute in the future? Foxconn, with all its foxconnections in the Chinese establishment will be able to really turn the screws into Apple. If Apple has Foxconn as their sole manufacturing partner, they would be well and truly f***ed if Foxconn turns against them. They need some buffer against this. And the only way is if Apple has other partners in other countries.



    Apple is not the only large company to use Foxconn, not by a long shot. You think Foxconn would jeopardize their lucrative contracts industry wide with a power play?
  • Reply 17 of 63
    djsherlydjsherly Posts: 1,031member
    Quote:
    Originally Posted by macarena View Post


    It very much looks like one subsidiary of Proview sold the rights to Apple, when the rights were owned by another subsidiary of Proview.



    If that's the case, then Apple hold as much ownership over the trademark than the party who sold it to them. Nemo dat and all that jazz.



    Quote:
    Originally Posted by macarena View Post


    In such a scenario, it seems logical that the 2 subsidiaries of Proview should slug it out in court - and maybe one of the subsidiaries owes a lot of money to the other. But that would really be left hand paying right hand - at a time when both hands are poor!



    Really the onus would be on apple to sue the first party for perpetuating a fraud.



    As for all the people baying for an immediate pull out from china. Kiss goodbye your iPads for a good twelve months whilst the manufacturing capacity comes online elsewhere. Apple won't do that.
  • Reply 18 of 63
    This is much ado about nothing. While the media may see it as something feeding their inane 24/7 cycle, there really is no story here. Just a very small company trying to get its 10 million or so. Next.
  • Reply 19 of 63
    "... The economies of scale paid by Apple..." "... but economies of scale in automation..."



    Seems like today is "economies of scale" quotes for this poster...but...that really doesn't hold up since the manufacturing process evolves rapidly in Apple's approach and requires quick adaptability, which S. Jobs made a big issue of in dealing with outsourcing. For example the wildly popular and now copied unibody form was built on the back of a heavy manufacturing process in including extrusion and milling by Catcher.



    "... Instead of Samsung, how about IBM, TXN or even Intel..."

    "Strategically, Apple should have invested in the Good Ol' USA. "



    Seems like an interest in investing in the "Good Ol' USA" may sound folksy but almost certainly chip manufacturing considerations, among thousands of other process decisions bear on financial, quality and innovative considerations, pipeline of already existing manufacturers, agility in change and on and on. A bit simplistic approach to complex enterprise decisions.
  • Reply 20 of 63
    If Proview did get a ban of the iPad in China...well that's easy. They just need to make Chinese manuals, boxes and the iPad itself without the word "iPad" on it. Everyone will still call it an iPad and life goes on.
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