Book Pirating in Taiwan

Book Pirating in Tjaiwan

by David Kaser

University of Pennsylvania Press Philadelphia

Copyright © 1969 by the Trustees of the University of Pennsylvania Library of Congress Catalog Card Number: 69-12289

To Jane who makes all things right

SBN 8122-7591-8 Printed in the United States of America

&©

Preface

My concern for the subject of this; report has developed out of two earlier research interests. The!first, which has engaged my attention for more than a decade and about which I have written several books and shorter papers, is the history of the American publishing industry during the period when it was peopled with the world's most prolific book pirates. The second and more recent related interest has been the state of the contemporary publishing industry in the Orient. Prior to the present study I had the privilege of participating in two surveys of book activities in the Far East, and it!was during them that I first came face-to-face with large-quantity modern book piracy. The confluence of these two research interests whetted my curiosity to learn more about book piracy and smuggling where it is most rampant today; namely, on the island of Taiwan. With benefit therefore of a generous v the two industries could increase rather than decrease their contacts to their mutual benefit. Third, the American industry continued and expanded its efforts to alert the legislative branch of government to the gravity of the piracy situation. Letters and visits to senators and representatives, individually and in committee, went forward from members of the industry, and a rather high level of congressional interest and concern was generated in the matter. Although the Congress was not in any better position than the State Department to take positive, curative action, it could be, as later developments would indicate, a valuable ally insofar as helping to elicit Chinese action was concerned. A fourth front opened up by the American industry was a broad-gauge publicity campaign designed to educate the public to the piracy issue. Among actions recognized as having potential effectiveness in contributing partially to the general public education on the problem were continued letters to congressmen; the publication of articles by authors whose works were being pirated; the solicitation of support from educational associations whose author members were losing much in royalty payments; and articles in the public press. Recognition of the problem by the jpublic at large began promptly to manifest itself with increasing frequency, and this recognition was indeed overdue and healthy. Stories appeared in The Wall Street Journal on March 15, 1960; in The New York Times on March 21, March 25, and April 4; on March 22 in The Times of London; and in Time magazine of April 4. It is understandable that these stories almost uniformly and exclusively presented the American view of the piracy problem, but at least one statement in the public press chided

62

BOOK PIRATING IN TAIWAN

the American industry for its self-righteous and inflexible position. The Baltimore Sun on March 26 observed that: The United States cannot protest with a completely clear conscience since its own record in the matter of book burglary is terrible. While this country was largely an importer of literature, it imported with a free hand and with little compensation to authors. When America's own literary productions began to attract world attention they were pirated in their turn, and the United States continued to hold aloof from the Berne Convention of 1886, under which most civilized countries afforded reciprocal protection to the authors of member nations, though it made many bilateral copyright treaties. Such public utterances were understandably unwelcome by American publishers, and the files of at least one major news source contain a letter written that week by an important industry spokesman requesting permission to read any story it might propose to print to assure that it "fairly represents the industry position" in the matter. An interesting difference existed between the English clamor in the nineteenth century for American copyright protection and the current American drive for Chinese protection. Whereas in the 1800's it had been authors who had led the fight for copyright, it was now almost entirely a publishers' fight. This difference resulted, at least in part, from the fact that the concept of a publisher as an author's agent responsible for looking after his interests was now much more fully developed than it was 150 years ago. It is probably more difficult, however, to develop public sympathy for the violated rights of multimillion-dollar publishing firms than it is for grubbing, impoverished, individual authors. This likelihood began to become apparent to the industry in early 1960, and it reoriented somewhat its public statements to reflect it. In a letter protesting piracy to the Secretary of State dated March 4, written jointly by Curtis G. Benjamin, then president of the ABPC, and Alden H.

AMES AND INDUSTRY RESPONSE

63

Clark of the ATPI, it was pointed out that the people most immediately affected and the heaviest losers from piratical traffic were authors. Five days later it was acknowledged in a meeting of the adhoc subcommittee on Taiwan Piracy of the Joint Foreign Trade Committee that publishers are rich in the eyes of many, and care should therefore be taken to make it clear that a major share of the industry's concern over the piracy problem was in the names of the many authors it represented. Doubtless another reason for author unconcern has been that the organized association of authors, the Authors League, has consisted primarily of literary authors, whereas the impact of Formosan piracy was largely in the area of scientific, technical, and professional books, the authors of which have had no organization. At any rate, spontaneous author concern has been surprisingly absent throughout the period of Taiwan piracy. Indeed, to be pirated in Taiwan has become to some authors a kind of badge of accomplishment and attainment, similar to being banned in Boston. The protests have uniformly come from the industry. As much as the American industry would like to have seen the Republic of China join other nations in signing the Universal Copyright Convention, the realists within it recognized that it would not happen soon. In their aspirations for a solution most American publishers concurred withj Wiley's Frank Forkert, who wrote in late 1959: I think the most imperative thing is that we stop the distribution of these books from Formosa toi other places. Once this has happened, and we have secured practical and reasonable protection under the laws of Formosa, perhaps we can then once again consider how to supply more inexpensive books to Formosan students. Hopefully, these developments would take place given proper industry pressure qn the diplomatic and legislative arms of the

64

BOOK PIRATING IN TAIWAN

United States Government and a satisfactory program of public education in the matter. To that time, however, the industry did not feel that it had aroused sufficient attention to the piracy problem on these fronts to elicit from them any helpful contributions to a solution. Morale was at a low ebb.

T4U 6 The Political and Diplomatic Fronts

Concern for the problem of Chinese piracy, as has been implied, ranged from limited to mild within the Department of State prior to 1960. Each specific complaint from the American industry was thoroughly checked out through the Taipei Embassy, but there was seldom as much real initiative in efforts to resolve the issue as the New York publishers would like to have seen. Much of the State Department's lack of enthusiasm for the subject doubtless arose out of a basic feeling of helplessness. The only possible resolution that could satisfy all American publishers—although certainly not the official industry position in the matter—would be for the Republic of China to sign the Universal Copyright Convention. This the GRC did not feel it could afford to do, and the State Department was reluctant to attempt to force it to do so, notwithstanding certain "hardline" opinions to the contrary within the American industry. There have in fact always been reservations among some American officials that signing the UCC would be in the best interests either of China or of the West. It has been important to Western interests for its information to flow as freely as possible into developing areas, and certainly the Taipei pirates were assuring such a flow into China. This view, for good reason amounting almost to pure heresy in the eyes of the New York industry, was seldom expressed, although it did emerge clearly in the aforementioned devil's-advocate editorial in the Baltimore Sun. We read constantly [its author observed] of the tremendous amounts of money and effort the Soviet Union is

66

BOOK PIRATING IN TAIWAN

putting into its scheme to flood the bookstalls of Asia with cheap literature, often in English. There is a lot to be said from the propaganda angle for a system under which Asian? can get, at a price they can afford, an American rather than a Soviet encyclopedia for technical or political work. Ambivalence therefore manifested itself in report after report from the State Department to the American industry on its complaints. State, in fact, uniformly concluded each such report with a paragraph urging that as part of any solution there should be the authorization by Americans of low-priced reprints for the Taiwan markets. The Department of State was as concerned as anyone about the loss of American property, but it also saw more clearly than some the need to preserve Taiwan's easy access to the information it needed. Given these apparently contradictory motivations, State Department officials worked long and hard and unpublicized to explain, to cajole, to wheedle, to educate the Chinese government into taking a new look at its piratical trade in search of a reconciliation that would be more palatable to Western book interests. Its efforts, as will be seen later, were not wholly unsuccessful, but because it had to lay its own foundations for building a body of ethical concern for the problem within GRC, its successes were slow in coming and modest when they arrived. Certainly they were neither prompt nor substantive enough to assuage the ire of an indignant American publishing industry. For these reasons the industry increasingly turned its attentions from the State Department to the Congress in its hopes for action in the matter. Being an elected body, the Congress has always been more responsive to the concerns of its constituency, and for the same reason it has never been quite as sensitive as State to the problems and needs of foreign nations. This has been especially true when those nations were receiving United States financial assistance, and the Republic of China

THE POLITICAL AND DIPLOMATIC FRONTS

67

was at the time a substantial recipient of such aid. Because of its control over appropriations, moreover, the wishes of the Congress weigh heavily in the determination of the success of all Federal programs; it simply will not fund what it does not like, so it was important for the State Department to have its programs liked. The American publishers' work with the Congress went well. As has been mentioned, Senator jThomas J. Dodd approached the State Department in mid-August 1959, and Bruce Brett's testimony before the Senate Appropriations Committee a week later prompted a strongly worded directive to the Department of State to "exert every effort in an attempt to have piracy discontinued." Soon thereafter Senator William Fulbright asked the State Department to testify on the matter before his Foreign Relations Committee, and Congressman Walter H. Judd, one of the pillars in the so-called "China Lobby," became sufficiently exercised about the problem to arrange an appointment to discuss it with the Chines^ Ambassador. As a result of this focusing of congressional attention on Taiwan piracy, together with the historical concern for the matter on the diplomatic level, and augmented by growing awareness and interest in the issue on the part of the public at large, several specific and forceful actions were t^ken by the American government to mitigate the situation during 1959 and 1960. These included: (1) threatened discontinuation of Mutual Security Aid to China; (2) the actual termination of the so-called Informational Media Guarantee; (3) a customs ban on importation into the United States of Taiwan reprints; and (4) a conference on the issue which brought together American industry representatives and high-level diplomatic officials of the GRC. Each of these developments will be discussed here in some detail. The first action—threatened discontinuation of aid to China—has already received some attention in this monograph. Bruce Brett's statement to the Senate Appropriations

68

BOOK PIRATING IN TAIWAN

Committee during its deliberations concerned with aid to China contained judiciously placed italics when he said that the ABPC-ATPI did not believe that "appropriations limitations are at this time necessary." The considered implication was clear that such limitations on Mutual Security Aid, without which the Republic of China would then have been in desperate straits, might soon become necessary. This testimony and its impact upon the congressional committee was forwarded home promptly by the Chinese Embassy in Washington and served as an incentive to GRC officials to seek more vigorously a solution to the piracy issue. Also, the United States Information Service in Taipei issued a press release on Mr. Brett's testimony, attaching his full text as news background. Both Chinese and English-language newspapers in Taipei carried the story, and these stories contributed to the growing consciousness on the part of the Chinese of United States anxiety over the piracy issue. The second forceful Washington action designed to prod the Republic of China to do something concrete about piracy was the discontinuation of the Informational Media Guarantee. The IMG was a U.S. Information Agency program under which countries which lacked dollars could purchase American informational materials and pay for them with their own normally nonconvertible currencies. With authority based upon a bilateral agreement between the United States and the government of a participating country, the USIA contracted with American book exporters to buy from them the otherwise nonconvertible foreign currency which they received in payment for the books, periodicals, motion pictures, and other eligible materials they supplied to dealers in the foreign country. In other words, the retail purchaser of such material in a foreign country paid his local dealer at the regular commercial price in his own currency, this same currency was remitted to the American exporter who then sold it for dollars to the U.S. Treasury, which in turn sold it to the USIA for meeting local expenses in its country of origin.

THE POLITICAL AND DIPLOMATIC FRONTS

69

The IMG program had long been an important device for maintaining the flow of needed American information into developing countries. It had operated smoothly in some twenty countries since its establishment following World War II, and the dollar-short and information-hungry Republic jof China had understandably been a substantial beneficiary of it! According to Bank of Taiwan statistics, there were in 1959 alone $340,000 worth of "active" contracts involved in the IMG program on the island. Its importance to the continued growth of the Republic's economy at that time can be readily understood. In August of 1959 it was decided in Washington —especially in view of increasing worldwide competition for limited IMG funds—that a firm action that could be taken as an expression of concern for book piracy would be the discontinuation of the IMG program in Taiwan. This move was made with the approbation of many representatives of the American publishing industry, although there was also considerable Equivocation in the United States government as to its overall | wisdom. Nonetheless on August 13 the Department of State notified the Embassy in Taipei that the IMG program in Taiwan would be suspended in fiscal year 1960, but it allowed the Embassy to pass the bad news on to GRC officials as and when it deemed best. Perhaps understandably, this news was received with minimal enthusiasm in the Mission in Taipei, and a decision was made there not to notify the Chinese government immediately of the program's termination. The fact, however, soon became known because within a few weeks Chinese book importers began receiving notices that their IMG contracts were not being renewed. Booksellers sought the reasons for the cutoff from the Chinese Foreign Ministry, which in turn asked the same questions of USIS and Embassy officials. In the ensuing dialogue between United States and Chinese officials concerning the IMG cutback, the Embassy diplomatically:

70

BOOK PIRATING IN TAIWAN

1. admitted that the program had indeed been terminated with respect to Taiwan but that the GRC had not yet been notified because there was hope in some quarters that it might be at least partially reinstated; 2. announced that its termination in Taiwan was only part of worldwide curtailment of the IMG program which was necessitated by reduced congressional appropriations; 3. finally hinted that the flagrant book piracy existing in Taiwan may have had something to do with the suspension of the IMG program there. The Chinese Foreign Ministry officials were greatly troubled by the IMG discontinuation and pointed out in reply that: 1. Publications imported under the program were important to the economic and cultural growth of China. 2. Continuity in the program was important, and once it stopped it would require much effort to have it reestablished. 3. As implemented, the curtailed IMG program discriminated against Free China, a faithful ally in the Cold War, while such Communist nations as Poland continued to benefit from it. 4. It would be almost impossible for the GRC to allot adequate dollars from its short supply of foreign exchange to maintain the necessary importation of American books. 5. GRC's recent action in the Encyclopedia Britannica case was evidence of its concern for the piracy problem. 6. IMG's suspension would work a real hardship on many firms that had little or nothing to do with piracy. In view of these points, the GRC sought reconsideration of the decision to suspend the IMG program in Taiwan. This lengthy interchange of considerations, many of which bordered upon the irrelevant, was simply the polite way of doing business. Both sides understood fully that

THE POLITICAL AND DIPLOMATIC FRONTS

71

the IMG curtailment would never have taken place if Chinese booksellers had not trafficked in unauthorized reprints. All of the secondary points, of course, were valid too, especially the final one that the IMG suspension would punish the wrong parties. A large share of IMG imports were magazines rather than books, and the Formosan Magazine Press and Fu Tar Hong, who between them controlled 95 percent of the Taiwan magazine market, suffered especially. They could not understand why they should be thus singled out for persecution since they were not even involved in book publishing. Furthermore, it was argued that suspension of the IMG would make book importation more difficult and therefore render piracy even more attractive than it had been before. IMG discontinuation thus was clearly recognized for what it was—a strong protest, regardless of consequences, from the United States to the Republic of China concerning the book piracy activities. Both the American Embassy and the Ideal U.S. Information Service, had of course, to ponder the impact of IMG suspension not only upon the specific matter of book piracy but upon the entire spectrum of country and program objectives for Taiwan as well. They frankly doubted that suspension was in the best interest of total country objectives, and they urged Washington to reconsider. At the same time, however, they stressed in their continuing discussion with GRC officials that United States concern for piracy would not be assuaged until there was: 1. actual incorporation into the copyright law of certain revisions in its implementation procedures; 2. reduction in the cost of book registration for copyright; 3. revision of the law so as to limit and simplify censorship examination for copyright registration; 4. the provision by law of more severe penalties for book pirates; 5. positive action by the GRC to halt the exportation from Taiwan of unauthorized reprints.

72

BOOK PIRATING IN TAIWAN

All in all, the discussions over the IMG suspension were salutary. They made it amply clear to officials of the Government of the Republic of China that the United States publishing industry, the State Department, the Congress, and the American people themselves were coming rapidly to a point where they would no longer tolerate piracy of their books, whether legally or illegally, and that they would take any steps necessary to see it end. The American book industry was anxious, however, that the government of the United States not put all its faith in hoped-for Chinese action to end the Taiwan reprinting problem. In addition to the pressure brought to bear upon the Chinese through discontinuation of the IMG and the threat of termination of Mutual Security Aid, New York book interests also sought relief from the problem of reprint importation through the Bureau of Customs. In a joint letter dated February 11, 1960, addressed to Secretary of State Christian A. Herter, writers Curtis G. Benjamin representing the ABPC and Alden H. Clark of the ATPI reminded him that importation of pirated books into the United States was illegal. Although they recognized that it would doubtless prove extremely difficult for the Customs Service to catch small shipments, they hoped that a way would be found to control their importation to some extent. It should be noted that this letter was written five days before the news broke of the quantity importation of books into Ames, Iowa. On March 7, the ABPC and ATPI approached the Bureau of Customs direct with a request that customs officers be instructed to stop and search all shipments from Taiwan book dealers and seize books of American authorship on the grounds that they were being imported in violation of the manufacturing clause of the United States Copyright Law. Upon deliberation the Bureau determined and reported three weeks later that it could indeed, under section 107 of the Copyright Law (17 U.S. Code 107) and Section 11.21 of the Customs Regulations, prohibit importation of unauthorized reprints if

THE POLITICAL AND DIPLOMATIC FRONTS

73

they bore copyright notices. However, in the absence of such copyright notices in the pirated editions, customs could only deny admittance to those titles for which the copyrights had been recorded individually with the Bureau by the original copyright holders. This latter process would be admittedly cumbersome, but the Commissioner of Customs was sympathetic, and he pledged to work on the problem. He concluded his reply by stating that "the Bureau appreciates the serious firiancial threat which this piracy represents to the American publishing community, and steps have been taken which it is hoped will greatly reduce or eliminate this unlawful practice." The determination by Customs that, in the absence of copyright notice, it could only act if individual titles were registered with it was a blow to American publishers, because in both direct cost and overhead such registration would have been prohibitively expensive. This procedure required that a publisher pay to the Customs Bureau a fee of $75 and furnish no fewer than 1,000 title cards for every title in his lists that he wished to see protected! As was pointed out in a joint XBPC-ATPI letter to Senator Carl Hayden, Chairman of the Committee on Appropriations, on June 2, 1960: "A publisher with an extensive list of books would be obliged under this system to pay total fees of $75,000 to $150,000 and to supply from 1,000,000 to 2,000,000 cards." Clearly this could hot be done. Despite its opinion that it could not act against unregistered book importations lacking copyright notices, the Bureau of Customs did proceed vigorously in cases where! it felt it was on solid legal ground. By early May 1960, a considerable volume of seizures had built up in customs offices around the country. In a fair number of the shipments some of the books bore the illegal copyright notices whereas others did not, and a delay developed in customs handling of such shipments while the Bureau studied its best action regarding them. Eventually it was decided that the books which lacked the notice and for which no fee or title cards had been received should be turned

74

BOOK PIRATING IN TAIWAN

over to the addressee, the balance of course remaining impounded. Despite the fact that some books thereafter continued to get through this net, the further fact that many were confiscated and others delayed made book importation from Taiwan a very risky business and tended to discourage prospective American book purchasers from attempting to meet their needs through Chinese sources. In connection with this discussion, an interesting and pertinent press release was distributed by the Treasury Department fully two years later. It is quoted here in full: TREASURY DEPARTMENT WASHINGTON, D.C.,

THE POLITICAL AND DIPLOMATIC FRONTS

75

owners failed to record their copyrights with the Bureau of Customs. The present action is being taken by Customs because it appears that the flow of pirated books has risen to the point where the Government is justified in taking across-the-board action to enforce the copyright law, even though copyright owners may not have protected their copyrights fully by recording them with Customs. Books found to be in violation of the Copyright law will be seized by Customs and destroyed. Commissioner Nichols recommends, especially to college students, that no more books be ordered from Taiwan and Hong Kong.

June 18, 1962 IMMEDIATE

RELEASE

CUSTOMS COMMISSIONER ORDERS PIRATED BOOKS DETAINED Commissioner of Customs Philip Nichols, Jr., has taken action under the copyright and customs law to stem the flow of pirated books into the United States. The Commissioner has instructed Customs officers to detain all books in the English language imported from Taiwan and Hong Kong until it can be determined whether their importation would be in violation of the copyright law. Recently it has been found that many books written and copyrighted in the Unitel States are being unlawfully reproduced in Taiwan and Hong Kong and shipped to the United States for sale at prices lower than the American publishers' prices. A large number of these are college textbooks^ Commissioner Nichols said that pirated copies of American books have succeeded in entering the United States primarily because the American copyright

By this time the importation of unauthorized Taiwan reprints had somewhat subsided, but the action was nonetheless welcome even at that late date by American publishers. As a fourth concrete action on the government level, the United States book trade sought and received a fulldress discussion of the piracy matter with Chinese Embassy officials in Washington. The meeting took place on September 13, 1960, with the American industry represented by!Warren Sullivan, Curtis Benjamin, L. L. Bruggeman, Bruce Brett, Dan Lacy, and Robert Frase. Present for the Embassy \tere Dr. Yi-Seng Kiang, Minister of Embassy, Dr. W. Y. Tsao, Cultural Counselor, and two junior officials. Mr. Sullivan, then chairman of the ABPC-ATPI Joint International Trade Committee, spoke for the American book trade. He indicated that he : and his colleagues were gratified at the recent actions of the Government of the Republic of China in reducing some of the worst piratical abuses and expressed hope that they might provide a framework for more satisfactory relationships in the future— leading ideally to accession by the GRC to the Universal Copyright Convention. Specifically and for the time being, however, he pointed out two things: (1) that the requirements for local

76

BOOK PIRATING IN TAIWAN

registration for copyright protection in the Republic were both too costly and too cumbersome for the American industry, and (2) that nothing short of a total and effective embargo on book exportation from Taiwan could be acceptable to the American trade. Minister Kiang responded that a major impediment in the way of Chinese adherence to the UCC was fear of being cut off from the use of foreign material in translation; that the American views on registration procedures would be forwarded to Taipei but that ten times the price of a book was not intended to be a discriminatory fee; it had been set by law and was certainly not exorbitant for domestic publications. He then presented a document addressed by the booksellers of Taipei to the American industry proposing an authorized American book reproduction program in Taiwan. The proposal—about which more will be said later—had been prepared by a consortium of booksellers in Taiwan and had been received shortly before the meeting. Following discussion of various points in the proposal, the meeting adjourned ;with the understanding that it would be reviewed in detail and a counterproposal filed with the Embassy for return transmission to the Taiwan association. These then were four offensive actions taken at the governmental level in response to the threat of large-scale losses to rampant Taiwan piracy. Financial aid to the Republic of China had been curtailed, and further cuts were being publicly discussed. Importation of Taiwan reprints into the United States was being hampered, if not halted. And a diplomatic offensive had been mounted through the Chinese Embassy. The next step was up to the Chinese.

The Carrot and the Stick: Reactions on Taiwan

As a result of these many efforts to combat Chinese piracy on the parts of the American publishing community, the Department of State, the Congress, and the public press in the United States, GRC officials came gradually to recognize that they would have eventually to deal substantially and constructively with the problem, and that the sooner it could be done the better. This recognition was either quite prompt in developing, or it was inordinately slow, depending upon the stance one takes in viewing what had to take place. The fact that the international ethical considerations involved in pirating had never really occurred to anyone in China prior to 1955, for example, was a great deterrent to action; an enormous amount of public education had to take place before sufficiently widespread concern for the matter could be generated there to warrant action. Another factor which tended to delay action on the part of the Chinese was simply that the Oriental concept of urgency differed considerably from that of the West; time perspective was different. Things generally have seldom been done there at the same rapid rate of accomplishment that is sought in the West, although the degree of differentiation lessens with each passing year. Still a third point that has to be borne in mind was that any changes that were to come had to suffer the painstaking scrutiny of the GRC bureaucracy which, as have all bureaucracies, moved excruciatingly slowly; it required time, time, time, to bring together and appraise the multiplicity of diverse thoughts, considerations, and interests which would interplay with the changes to be made. From this viewpoint, one might marvel that any

78

BOOK PIRATING IN TAIWAN

changes in the piracy situation were accomplished at all. To the American book interests that awoke every morning poorer because of lost royalty revenue, the month after month after month that passed without positive, remedial, reportable action dragged on interminably. To them the long periods of apparent inaction by the GRC represented nothing short of calculated and gross unconcern for the international thievery that it thus condoned. Whichever of the two views one chooses to take with regard to the promptness or slowness of response, action did indeed occur. Chronologically the first major step taken by the GRC against the pirates has already been reported here. It was the authorization for registration of the Encyclopedia Britannica in the late summer of 1959. This registration was not an inconsiderable matter to the GRC as it required agreement among authorities in several of the ministries; it required decision-makers to think in ways new to China regarding the fundamental purposes of registration and censorship examination; and it was taken in opposition to some wealthy and powerful interests in Taiwan. The period was one of great and often painful soulsearching for the participants, and the ultimate judgment—although it may have appeared minor in the eyes of some American observers—had enormous impact and bore the great weight of important precedent on its shoulders. Concurrent with EB deliberations in the executive Yuan of the GRC, there was also extensive expenditure of effort in the legislative Yuan to draft new regulations for enforcing China's copyright law. Embassy and other American officials had long been informed when they sought redress in piracy cases that the legislative Yuan was working on a revision of the enforcement regulations, but the American publishing industry remained dubious that if and when new legislation was passed it could be helpful to them. The long-awaited revision of the Regulations for the Enforcement of the Copyright Law of the Republic of China was finally promulgated as of August 10, 1959. Translations were made immediately and rushed home by the American

REACTIONS ON TAIWAN

79

Embassy, where the Department of State distributed copies into the eager hands of industry representatives. By this time, however, the American industry had waited so long for relief from the piracy problem that it would probably not have been appeased by anything short of an exact copy of the United States law. Certainly the few modest improvements incorporated into the new law were not adequate to satisfy them. Upon careful examination it appeared that substantive alterations had been made only in two places. A new Article 10 for the first time made it clear that foreign language books could indeed by copyrighted by registration and? the payment of fees—-a question which had been in dispute earlier in the year with respect to the Encyclopedia Britannica. And a new Article 13 authorized local government officials to seize books printed in violation of copyright and to take other "effective administrative measures." These were steps in the right direction, but they were certainly not enough to make the American industry happy. Furthermore, the new regulations retained as Article 8, Section 1, the controversial requirement that the "registration fee for a literary work shall be ten (10) times that of the list price of the work in question" or five times in the case of an adopted textbook. One American publisher, after studying the revised law, expressed as follows the frustration felt by the entire industry: ! What we need at this time, and for some time to come, is practical copyright protection in Formosa. Irrespective of the State Department's viewpoint, I feel that U.C.C. acceptance by Formosa can solve the problem easily and in accordance with international procedure and practice. This means a revision of their laws to coincide with the U.C.C. agreement. The current laws are inadequate and we all know it. What can we do about it now? Most annoying to the American publishing community was the gnawing recognition that it could really do nothing at all to force Chinese accession to the UCC principle. Such accession could

80

BOOK PIRATING IN TAIWAN

only come over a period of time with enlightened Chinese self-interest. As in the case of the EB decision, the GRC was proud of its revision of the enforcement regulations. It felt that, since it would patently increase the costs of some books in Taiwan, it would be recognized widely as an act of magnanimity, a concession to world opinion, and a manifestation of good faith. Such, however, was not to be the case, because few persons beyond the diplomatic level saw it in these terms. The American publishing community certainly did not, and through its effective access to the public press the industry largely determined the course of American public thinking in the matter. It was shortly after the EB decision and revision of the enforcement regulations, both favorable to United States book interests, that Chinese government officials first learned of the IMG termination, and many felt that it represented somewhat shabby treatment. In response simply to the American Embassy's explanations of the grievances of Western publishers, the Republic of China had just concluded two actions which i t felt to be substantial peacemaking steps, only to be slapped immediately with actual termination of aid for not having done more. There was understandable bitterness in some Chinese circles over this apparent lack of appreciation for the difficult improvement of the recent past and now the international "blackmail" of aid suspension to force still more concessions. Bitterness or no bitterness, however, the Republic of China simply had in 1959 to retain United States aid; this was a very real and undeniable fact of national survival. It was not yet able at that time to determine alone its economic future, so the GRC suppressed its pride—not easily done anywhere but especially difficult in the Orient—and began searching for additional ways of mollifying American interests concerning book piracy. While they were searching, the case broke of quantity book exportation to Ames, Iowa. Several times previously the American Embassy had queried GRC officials as to

REACTIONS ON TAIWAN

81

how they rationalized allowing the pirates to ship books off; the island of Taiwan. If indeed it were true, the Embassy ihad reasoned, that the Chinese would not sign the UCC only so that the Chinese people could have cheap reprints, this could hardly be valid ground for permitting the reprints then to be exported. Now that the great hue-and-cry about exportation arose following the Ames incident, the Embassy again raised the stale argument. The logic of the point, plus the increase of j sincere concern in Taiwan for the piracy issue, plus the fear Ithat the United States might further curtail all-important financial aid to China, weighed heavily upon Ministry officials in Taipei as they pondered the problem of exportation of their low-priced reprints. Again their deliberations were complicated by the fact that the export trade was an extremely lucrative one, and large monied interests pressed government officials hard to retain the profitable status quo. The weight of world opinion, however, won out over money, and on March 23, 1960, the GRC made the most momentous decision it has ever made regarding its book industry. The following day Dan Lacy, Managing Director of the American Book Publishers Council, distributed a terse bulletin to members of the Council and of the Joint Foreign Trade Committee. "Word has just been received," he wrote, "thati the cabinet of the Chinese Nationalist Government has issued a decree banning the export from Formosa of all reprinted bdoks in all foreign languages. Further details will be supplied as they become available." Details of the decision turned up the following day in The New York Times. Orders banning exportation from Taiwan of foreign-language reprints had indeed been issued by the executive Yuan's Foreign Trade and Exchange Control Commission. Enforcement of the regulation was assigned by the order to the Bank of Taiwan, the Customs Service, and the Post Office. Despite the order, the Times was quick to point out, the GRC did not intend soon to join the UCC. "Government

82

BOOK PIRATING IN TAIWAN

sources in Taipei," it added, "said there were many problems and considerations involved in that decision, but they refused to elaborate." The news of the export ban by the executive Yuan came concurrent with extensive discussion in the legislative Yuan of the need for copyright law revision, and the combined publicity given to the two actions created for the first time in Taiwan widespread public awareness of the piracy issue. The China Post, the island's only English-language newspaper at that time, carried long articles on piracy in its issues of March 25, 27, 28, 29, 30, and April 2, 3, 6, 7, 9, and 10. Indeed the April 7 issue of the paper carried no less than two long press releases, a letter to the editor, and thirty-six column inches of editorial on piracy. The vernacular press also devoted considerable space to the subject, manifesting clearly the ferment of public concern there for the controversy. Most of the Taipei publicity concerning piracy was favorable to United States interests. The legislative Yuan summoned some thirty local book dealers, authors, and publishers to a meeting on March 26 for an exchange of views on a proposed revision of the copyright law. Vice-Minister of Interior Chi Yuan-Pu opened the meeting with a warning that if book piracy were not stopped in time, "the consequences would be very serious," and he expressed the desire for new legislation that would offer protection to authors and copyright owners. Prominent author Chen Chi-Yin stated that he had heard Taipei reprints of Western books referred to sarcastically as "the most famous special product of Taiwan" and that he felt shamed by such comments; he urged that the new law contain severe penalties for piracy. On March 28 Minister of Interior Tien ChiungChin quoted publicly from the Baltimore Sun editorial of two days previous which had extolled the propaganda value to the United States of cheap Chinese reprints but, he added quickly, "our book dealers should not use this as an excuse for pirating American books and selling them in the United States." This

REACTIONS ON TAIWAN

83

latter point need no longer have been made, of course, since exportation had been banned five days earlier. The Interior Minister, who himself held a Ph.D. degree from the University of Illinois, expressed hope that "our book dealers would take the initiative" in negotiating an agreement with American publishers wherein low-priced reprints of their books could be made in Taiwan. This view was publicly echoed on March 31 by noted political commentator Tao Hsi-Sheng. This agitation spawned charges andj countercharges, rumors and half-truths, rejoinders, and surrejoinders. On April 2 a statement was published, attributed to Director of Police Administration Huang Yu, giving the impression that the MOI was about to impound all unauthorized reprints in Taiwan. This rumor, which could only have been that, since there was no law under which such seizure could be made, may have resulted from a police order two days earlier requiring all Taipei booksellers to supply an inventory of the American books which they had reproduced in the several years preceding. The order bred understandable apprehension within the trade that such a list might well be preliminary to more drastic police action. It may have been, of course, that Police Director Huang's statement was intentionally publicized in exaggerated form in order to galvanize the local book trade into sjome kind of defensive action to counter the rapidly developing consensus against piracy. If that were its purpose, it was remarkably successful, because the trade rose up immediately and to a man to assure that its bookstocks would not suffer confiscation. They retained an attorney, Li Chin-Fang, to represent their interest; they held a news conference of their own; and on April 4 they addressed a long, lucid, open letter to United States Ambassador Everett F. Drumwright presenting their case in the matter. Spokesman for the Taipei book trade in the press conference and author of its letter was Sun Kuo-Jen of Rainbow-Bridge Book Company. The interesting Mr. Sun, although never having been in the United States, had nonetheless studied carefully the English language instruction books he

84

BOOK PIRATING IN TAIWAN

purveyed, and he spoke and wrote English as though he were born and reared in Omaha. This facility, coupled with his rapier-quick mind, blunt outspokenness, and effervescent sense of humor, plus many years of experience as a Customs official during which he had learned thoroughly the labyrinthine ways of accomplishing one's ends in a bureaucracy, made him the ideal person to state the local trade's position. Mr. Sun's letter, signed not only by himself but by eight of his colleagues in the trade as well, was a good one. The points made in it have all been presented at one place or another in this monograph, so they will not be repeated here. It amounted, however, to a position paper for the Taiwan trade. It began with a reminder that Chinese students could not afford books at Western prices and that for Taiwan reprinters to make them available for less was in no way illegal in China unless they had been duly registered with the MOI. It explained that time and again, when Chinese bookdealers had sought reprint authorization from American publishers, they were either refused or their appeals had brought no reply. It pledged to defend its bookstocks against illegal seizure by the police while reaffirming the trade's "readiness to work together with any American publisher toward an amicable solution of the problem." In closing, the straight-talking Mr. Sun queried the Ambassador as to the veracity of rumors that American aid was being used as a lever to pry copyright concessions from the GRC. Again it was the Director of Police, Huang Yu, who got the blame for rumor-mongering. Mr. Huang, according to Mr. Sun's letter: told us in person on April 2 that the United States is "cutting back aid funds to the Republic of China because of unauthorized reprinting of American books in Taiwan." While we do not doubt the authenticity of a clearcut statement from a responsible official of our Government, we cannot believe that Your Excellency and your Government would use American aid as both the carrot and the stick to

REACTIONS ON TAIWAN

85

deprive the 30,000 college students in Taiwan of the source of cheap textbooks. The text of the letter was released to the press, and there it was, squarely put before the world: Would the United States really terminate aid to this end? It was Director Huang's lot to have publicly to deny the rumor. In the China Post for April 7 he disclaimed even mentioning United States aid during his meeting with the trade. "I am not an official in charge of U.S. aid," lie said. "There was no reason whatsoever for me to mention that." At the same time, the Minister of the Interior was having to deny the other rumor attributed to his hapless Police Director: namely, that the police were preparing to impound unauthorized reprints: I have no knowledge of such a claim [avowed Minister Tien] and I doubt if Director Huang has ever made such a statement. While we are not planning to confiscate those reprinted books already on the local markets, we are also trying our best to make it possible for textbooks to be reproduced here in the future for sale to Chinese students through negotations between local publishers and foreign copyright owners. So much therefore for the denials. It should not be assumed that all voices heard in this Donnybrook supported the American position. Letters to the editor decried the high prices of Western books. Thi Taipei newspapers reprinted almost the entire Baltimore Sun editorial within thirty-six hours of its appearance in the Maryland city. Surely, opined Western interests, such an editorial aided and abetted the enemy! Tao Po-Chuan, leading member of the control Yuan, China's supreme watchdog organ, reminded the public that the reproduction of Western books in Taiwan "does not constitute a legal problem since China is not a party to the

86

BOOK PIRATING IN TAIWAN

International Copyright Convention," and he warned the GRC not to issue any capricious or arbitrary orders making the police ban the sale of such books. Dr. Hsieh Min-Shan, respected dean of the Chung-Yuan College of Science and Engineering, issued a public plea on behalf of Chinese students pointing out that they would be in great difficulty if the sale of Taipei facsimile textbooks were to be outlawed by police action. In the midst of all this frenetic concern on the part of the Taiwan trade, the Taipei District Court handed down a verdict on April 8, 1960, convicting five persons for book piracy. The first, a professional book pirate, was sentenced to a year in prison and fined N.T. $1,500 (U.S. $37.50); three others were imprisoned for ten months and fined N.T. $900 apiece; and the last—a distributor only—was fined N.T. $1,500. Word of the convictions appeared the following day in The New York Times, and it inspired some in the American industry to think that perhaps the days of book piracy in Formosa were really coming to an end, although many old Chinawatchers were frankly doubtful. Their doubts were confirmed when the full story became known several days later and it was determined that the convictions had been for pirating copyrighted Chinese books and that no Western reprints had been involved. During the peak din of this skirmish with the pirates at least two American publisher's representatives were present in Taipei. Between April 1 and April 10 Norman J. Wright of Henry M. Snyder & Company, and Rudolph Coons of D. Van Nostrand were moving in and out of the bookstores and appropriate government offices, asking questions of the pirates and generally raising the level of anxiety even higher than it would have been otherwise. Their reports home represent masterful reporting of the fever pitch to which concern had risen. Describing the two-day period between the rumor and the denial that the police were to confiscate reprints, Mr. Wright wrote: All retail stores were given long forms on which they had to list every pirated book in stock. They

REACTIONS ON TAIWAN

87

were to be taken off sale until a "royalty arrangement" could be made. . . . Consequently, as I walked down the street, I saw that every bookstore had the blue-bound pirated copies piled on the floor, listing and counting them. On several occasions I saw peddicabs containing fat little Chinese women and all that the peddicab could hold of the Merriam Unabridged Dictionary, darting frantically on their mission of getting rid of books as fast as possible. For example, the Michener Hawaii had been selling for about U.S. $1.75. Last week it was selling for 45^ in the booksellers' attempt to get rid of as many as possible before the police swooped in. Somehow the three-week battle ended as suddenly as it had begun, and when the smoke cleared and the results were calculated, it appeared that American interests had won a partial victory only, but a very important one; nonetheless. Exportation of books from Taiwan was now clearly illegal, but piracy on the island was still permissible if the copyright owner failed to register his right with the MOI. And the registration fee remained at ten times the price of the book—still too high to attract the interest of American publishers. There was now widespread concern and understanding of the issue in China, and five booksellers had received the severest penalties anyone could remember having been levied for piracy, although of Chinese books. Furthermore, the legislative Yuan had gained a wealth of commentary pro and con to aid its deliberations on a new copyright law. If only the Government of the Republic of China could make its book export ban stick and thereby contain piracy to the island, Americans felt, the continuing struggle to cope with it would have assumed much more manageable proportions and the three weeks would have been well spent. But that was a big IF.

NEGOTIATIONS FLOUNDER

And Never the Twain . . . .. Negotiations Flounder In his April 10, 1960, report from the Orient to his home office, D. Van Nostrand's Rudolph Coons expressed his "admiration for the speedy action which our State Department got in securing the ban on export of pirated editions outside Formosa." But, he added, "it is to be hoped that enforcement of this ban will receive similar support." Old China hands in the book industry almost unanimously shared a jaundiced view of the likelihood of enforcement. In reporting the export embargo, Publishers' Weekly on April 4 expressed its doubts that the blockades would be taken seriously: The effectiveness of this enforcement remains, of course; to be seen. American publishers who voiced skepticism about the policing of the new law noted that the South China Sea has been an area rife with piracy of one sort or another for many centuries. It is problematical whether Formosan authorities will be effective in stopping the export of pirated editions to Far Eastern and Southeast Asian markets. The same dubious attitude pervaded the entire American book community. Feelings in the Taiwan book industry, however, were mixed. Several firms—notably Southeast (through its subsidiaries), Far East, Tan Chiang, Eurasia, and Universal—had been caught by the suddenness of the export ban. They had tooled up and produced for the export market which was now cut off from them, and their warehouses were full of newly minted books in editions much larger than the island of Taiwan could absorb alone. If they were going to abide by the ban, huge

89

chunks of their capital would be tied up in stocks of books which would be essentially unsalable. Here indeed would be great irony: the other developing countries of the Orient were desperate for inexpensive sources of information while;the Taiwan warehouses were full of cheap facsimile textbooksj doomed to be pulped because it was illegal to move them. As the proprietors of the large reprint firms surveyed the wreckage of the industry which they had soj recently built, they reacted in different ways. Several frankly faced the fact that exportation was now illegal, took their losses, and reverted to making much smaller profits in the legitimate supplying of the domestic markets. Others, while refusing personally to export, found themselves delivering with no-questions-asked large quantity invoices to distribution fronts which had no visible markets anywhere on the island. Still others continued blatantly to export, although this last group was small. Mr. Coons, for example, in his letter of April 10 told of his discussion with perhaps the most notorious Taiwan pirate, who was outspoken and vehement in defense of his right to reprint without permission or payment. "You will never succeed in stopping it," he asserted. Twice I caught him saying that he has had a perfect right to export and is doing so right along; each time I asked him if he was still exporting after the ban of March 23rd—and each time he backed down, saying no, not since March 23rd (but without great conviction of tone). . . . Subsequent developments have indicated that this particular pirate did not at that time discontinue exporting books and indeed may not have done so yet. Under pressure from the several GRC ministries most involved, the period became one of negotiation, as the Taipei booksellers tried again and again to work out arrangements by which they could gain authorization to reprint American books. Grand schemes, panaceas, and comprehensive pro-

90

BOOK PIRATING IN TAIWAN

posals to resolve the issue, of course, were nothing new. Almost everyone involved had at one time or another been his own panacea-maker, but efforts had uniformly come to naught. Proposals had much more frequently been framed by Asians than by Americans. Whereas before, however, efforts to negotiate had been limited almost entirely to individual booksellers who sought to gain rights for their respective firms, there was now some incipient concerted activity on the part of the entire Taiwan book industry. The first indication of their banding together on the reprint problem was their press conference of April 2 and their open letter to the United States Ambassador on April 4, 1960. Although that letter had been signed by only nine of twenty-nine known pirates, the signers represented the largest and most powerful firms. Many of the smaller reprinters, it must be remembered, produced only one or two books a year and were totally ignorant of the meaning of the problem. The first major comprehensive proposal was put forth by an aggregation of major booksellers calling themselves the Taipei Book and Educational Supplies Association. It was their proposal that was presented cold to American industry representatives when they called on the Chinese Embassy in Washington on September 13, 1960. Although there can be little doubt that the timing of the proposal and the way in which it was produced out of thin air as it were, and without warning, was carefully calculated to upset the balance of the American visitors, it also constituted a serious effort on the part of the Taipei book trade to get something moving on the issue. This document presented a rather simple plan for the wholesale legitimization of the Taipei industry. It proposed that all negotiations for reprint authorization in Taiwan should be concluded through the so-called Taipei Book and Educational Supplies Association. American publishers were not to "reject applications for reproduction submitted by the Association" and were to "receive royalties at a certain percent of the amount in New Taiwan Currency accruing from the pro-

NEGOTIATIONS FLOUNDER

91

ceeds of the actual sale." Royalties would be paid on books already produced on the basis of the volume of sales!from the date of concluding the agreement being proposed. Registrations with the MOI would be filed by the Association. Regardless of what else the proposal accomplished, it had put the American industry deputation off its stride. It went home promising to study the proposal and to supply a counterscheme as soon as possible. Following a careful review of the document by the Joint International Trade Committee, its chairman, Warren Sullivan, replied for the industry a month later. His letter of October 12, 1960, addressed to Dr. Yi-Seng Kiang, First Minister of the Embassy of the Republic of China, was conciliatory in tone and optimistic in outlook. Rather than being a counterproposal, however, the letter was a simple response to several specific matters in the original proposal. Mr. Sullivan's opening observation was that "the general terms of the agreement, subject to such reservations or comments as are hereafter mentioned, are satisfactory, and we hope that they will lead the way toward mutually satisfactory publishing relations between our countries." He pointed out, however, that the American Book Publishers Council and the American Textbook Publishers Institute could not control the actions of their members so as to meet the stipulation that all American firms would accept all requests for authorization— and only those—that were made through the Taipei Association. The Council and Institute could recommend policy to their members, but they could not enforce it. "There may be circumstances," Mr. Sullivan stated, "in which the American publisher would find it impossible to grant rights because he had already assigned them elsewhere. For example, he might have sold reprint rights to a Japanese publisher for a marketing area that included China." The proposed royalty rate was satisfactory so long as provision was included for the full conversion of payments into U.S. dollars. He requested a list of the members of

92

BOOK PIRATING IN TAIWAN

the Taipei Association and pointed out that guarantees would need to be included in any agreement that would assure the policing of nonmember Taiwan publishers as well as members. He assumed that the Association was seeking reprint rights for sale in China only. In concluding, Mr. Sullivan stated that ultimate adherence to the UCC by China was still considered the most desirable solution by the American industry, but "in the interim," he allowed, "an agreement along the lines we are considering here will be fruitful." There can be no doubt that some American publishers had misgivings about the plan. Fear was widespread, for example, that the proffered periodic royalty reports of certain Taipei booksellers would contain fictitious sales figures and that payment would therefore be made on only partial editions. Indeed an ancient and almost honorable Oriental tradition would seem to come near forcing the falsification of such royalty reports; it was the widespread custom among many Asian business firms of maintaining two sets of account books—one correct set and a second one showing considerably less business activity for the benefit of the tax collector. Taxes, in fact, have been known in some cases to be set higher than was necessary because officials recognized that they would only be able to collect on incomplete reports anyway. If any Taiwan booksellers were reporting short to the tax collector therefore, they would certainly not then buy official currency exchange for royalty payment on the correct level of sales. This would in effect be creating one paper document testifying to the falsification of another paper document, and the Taiwan industry was much too smart to do a thing like that. If they falsified one, they would certainly falsify the second to agree with it. Nonetheless, despite these and other similar doubts as to the workability of the scheme, the ABPC-ATPI reaction to the Taiwanese proposal was hopeful, cordial, and sincere. Regrettably, however, nothing ever came of the negotiations. For all practical purposes they ended then and there, and the reason for their termination is unclear. One can

NEGOTIATIONS FLOUNDER

93

speculate with some confidence that the reason was a j lack of adequate consensus and cooperation within the Taiwan book industry. Cooperation is never easy to attain in Asian countries, where one's responsibilities are often thought of as being to his family and business and to little else. Allegiance to an industry —or to a profession, or a place, or a society—is seldom strong, and promising cooperative efforts of many kinds have often broken down in their early stages as participants dissipated their energies maneuvering for positions of personal power or profit to the detriment of their colleagues. Because of the poor records which cooperative enterprises have posted in the Orient, few people there place much faith in them; usually therefore they are weak and short-lived. Such appears to have been true in the case of the proposal of the Taipei Book and Educational Supplies Association. Minister Kiang was unable even to acknowledge Mr. Sullivan's counterproposal until five months after it had been received, and when his reply was filed it was a great disappointment to the American industry. Although he agreed that Taiwan publishers were interested in gaining authorization to print only for the Taiwan market and that royalty payments could be converted into U.S. dollars, he could offer little else. As regards the Taipei Book and Educational Supplies Association, he reported that it is now in the process of reorganization and when completed is expected to have a combined membership of more than one thousand (1,000) individuals and concerns. The list is not available at the present time. No more mention of a Taiwan booksellers' association was to be forthcoming for five years. Old China hands said "We told you so." Little occurred in subsequent months to encourage American publishers to hope for an early resolution to the piracy problem. The status quo continued on all fronts. For a time the American industry retained a Taipei attorney to act in a

94

BOOK PIRATING IN TAIWAN

sense as its lobbyist to guide improvements in the situation through the halls of the Chinese government. Among improvements encouraged upon him by his American clients were reduction in the fee for the registration of books with the MOI; severer penalties for pirates; stricter enforcement of the book export ban; and other similar actions. Despite his competent and extensive efforts, however, nothing changed. The American industry once again took its plea for action to the Congress. On September 7, 1962, Edward E. Booher, president of the McGraw-Hill Book Company, testified for the ABPC and the ATPI before the Senate Appropriations Committee studying foreign aid appropriations. His message was the same as had been delivered by the industry before, and in its published report the Committee made the same reference to the problem as it had made before, "The Department of State is requested to continue efforts. . . ," it began. One thing that was changing, however, was the incidence of piracy. Relentlessly and continuously the number of Western books in print in Taiwan editions grew and grew, until it stood in the fall of 1962 fully at 2,000. The impudence of the infamous pirate firm, Far East Book Company, manifested itself again when its winter 1961 Catalogue of Books appeared and it displayed as its cover the colophon of the Viking Press. This well-known device, a Viking ship scudding before the wind, had been drawn for the Press by Rockwell Kent at the time of its founding. Since it was a registered trademark, the Press consulted its attorneys to determine if legal action would be desirable, and it dispatched seven hundred photo-offset copies of the device to the Customs Bureau to aid in its efforts to intercept parcels of pirated books. When it was later determined that the emblem had also been used by such other Taipei firms as Far East's subsidiary, the American Book Company, and Literature House, the Viking Press gave up the idea of attempting litigation in the case. In late 1962 the American book industry decided that the time had come to put China's copyright law to the

NEGOTIATIONS FLOUNDER

95

test. Chinese officials had since the 1959 revision been claiming that there was now adequate protection available in Taiwan to the American publishers who would take the trouble to register their books with the Ministry of Interior. McGraw-Hill had registered two of its most important titles—Paul A. Samuelson's Economics, An Introductory Analysis on April 16, 1962, and The Encyclopedia of Science and Technology on June 21, 1961. The problem to McGraw-Hill was not only one of cumbersome negotiations but of substantial cost as well. It cost thd firm $160 to register the Samuelson book, and the latter title, a ten-volume set which retailed in the United States at $175, cost; $1,750 in registration fee alone. In addition McGraw-Hill paid out $950 in attorney's fees to get the registration made and was required to deposit two copies of the work. The complaint by American firms that registration was prohibitively expensive was amply demonstrated by the case of this Encyclopedia which thus cost almost $3,000 all told. Eventually both Samuelson's Economics and the Encyclopedia of Science and Technology wen; pirated. McGraw-Hill's Taipei attorney, Ruchin Tsar, first! instituted legal proceedings in the case of the former title. Mr. Tsar, who had come to Taiwan from the China Mainland where he had attended Soochow University, was a very gracious yet competent and forceful attorney. He had served many Amejrican firms and causes, and he was a good choice to handle this first test case involving piracy of a registered foreign book. Mr. Tsar on July 18, 1962, filed a written complaint with the MOI that Taipei bookstores had pirated the Samuelson book. The police, apprised of the complaint in due time, raided four stores on October 3 and seized twenty-one pirated copies from two of them as evidence; they raided again on October 23 but found nothing. On November 29 the Taipei District Court handed down indictments against the two booksellers. They were Hsiao Sheng-Meng of the same Book World Company that had first pirated the Encyclopaedia Britannica in Taiwan, and Liu Ching-Ti of the Lucy Bookstore, now wife of

96

BOOK PIRATING IN TAIWAN

Southeast's Choh Chin-Shin, the second Taiwan reprinter of the EB. On January 19, 1963, the Court found the defendants guilty as charged, and they were sentenced accordingly. Mr. and Mrs. Hsiao were fined N.T. $300 apiece (totaling U.S. $15), and Miss Liu was fined N.T. $600. Although the fines do not appear monetarily to have fitted the crime, the meaning of the conviction cannot be calculated in dollars alone. One Chinese observer pointed out shortly after the case had been concluded that The significance of this judgment is not to be measured in terms of the severeness of the sentence, but rather in the light of the authoritative condemnation of the act of book piracy by the court. Likewise the pain suffered by the book pirates is not to be measured in the amount of the fine, but rather in terms of the dishonor and inconvenience they have received. The Foreign Exchange and Trade Control Commission of the GRC shortly thereafter suspended the foreign exchange transaction rights of the two convicted bookstores, and the Book World Company subsequently left the business of reprinting books entirely. The case, however, was not to end there. The convicted booksellers appealed their case to the Taiwan High Court where during the spring they argued that the District Court judgment should be set aside for lack of evidence. The defendants produced their business records showing that there were neither invoices nor vouchers for Samuelson's Economics. Pleading for the prosecution, Mr. Tsar promptly refuted that since the defendants were aware that the sale of the reprint was an illicit business, they would naturally avoid the use of legitimate invoices and vouchers for it, and that the lack of such documents was not conclusive evidence of their not having been sold; that the discovery and seizure of pirated editions on display at their places of business created a presumption of guilt

NEGOTIATIONS FLOUNDER

97

which shifted the burden of proof to the defendants to prove with evidence their innocence. In this case, however, the appellate court on May 15 found for the defendants on insufficiency of evidence and overturned the lower court's judgment. Morale plummeted when news of the acquittal reached the New York publishing community. Some bitterly assumed that there had been a deliberate miscarriage! of justice —and such there may have been—but in defense of the appellate court decision it must be pointed out that there are no such elaborate rules of evidence in Chinese law as there are in the West and that the probative value of evidence is therefore decided in the light of the judge's "moral convictions" born of his "daily experience and logic." Regardless of the legitimacy of the judgment, however, the likelihood of further negotiations between the American and Taiwan book industries was much reduced by it. The general feeling in the American industry was that serious discussions were no longer possible because, without practical legal protection of their rights, American firms would be negotiating under duress. j It also appeared at the time that attorney Tsar had fared little better in his case against the pirate of the Encyclopedia of Science and Technology. Its registration had almost wholly removed the pirated edition from the open shelves of the Taipei bookstores, but it was available almost everywhere clandestinely. Mr. Tsar filed a written complaint of the piracy on November 5, 1962, and the police made several raids on three Taipei bookstores but found nothing. Eventually Mr. Tsar himself was allegedly able to purchase a set in fifteen volumes from Miss C. C. Tang of the University Book Store near the campus of National Taiwan University. He reported paying N.T. $1,600 (U.S. $40) for the Encyclopedia and was able to get a receipt for the sale. On March 13, 1963, the Taipei District Procuratorate preferred indictment against Miss Tang on two counts: (1) book piracy, and (2) forgery for selling books bearing the names of the editors without their consent. The Taipei District Court, however, on May 22

98

BOOK PIRATING IN TAIWAN

found for the defendant who argued that the receipt she had written was not for a pirated set but for a second-hand set of the Western edition of the Encyclopedia which she was disposing of at the request of an unidentified third party. The implication of the judgment was that a receipt for a pirated book could only be admitted in evidence if it stated that the book being sold was a pirated edition. This acquittal came only two days after the successful appeal by the defendants in the Samuelson case, and poor Mr. Tsar had to deliver both items of bad news to his New York client in the same letter. Again the most experienced New York heads wagged knowingly. Now, however, it was the prosecution's turn to appeal. Mr. Tsar filed immediately for an appeal in the Encyclopedia case, which then remained pending for a long time before the Taiwan High Court. On June 30, 1964, the High Court finally reversed the decision of the District Court in the matter and fined the defendant 400 silver dollars (U.S. $30). It should be noted in this connection that, although it has since been increased to two years imprisonment, the maximum punishment for copyright infringement under the law at that time was only 500 silver dollars. Thus the punishment meted to Miss Tang was in its context considered quite severe. The possibility of appealing the Samuelson case, however, was vague. It was not really possible to appeal a decision of the Taiwan High Court where the defendants had been acquitted, unless the case were a felony, which it was not. The only recourse left was for the Procurator General, if he were convinced that the judgment was in obvious contravention of the law, to bring an extraordinary appeal before the Supreme Court, and this would obviously be a very serious move. Nonetheless, and despite its severity, such action was under consideration for a long time. The GRC was greatly embarrassed by the two nearly concurrent acquittals, and the executive Yuan ordered the Procurator General to study carefully the possibility Of taking the Samuelson case before the Supreme Court. The matter was several times discussed in the Cabinet but, as the

NEGOTIATIONS FLOUNDER

99

United States, China has an independent judiciary system, and rather delicate handling of the case was required. Pressure for the extraordinary appeal was eventually much relieved by the High Court's favorable ruling on the Encyclopedia case in mid1964. The two cases did not settle much. It! now appeared that American publishers had some protection,) although not as much as they would have liked. They continued to hold the opinion that they could not authorize Chinese reprinting without guarantees that piracy would end. The GRC, on the other hand, continued to refuse to outlaw piracy without guarantees that cheap reprints would continue to be available. Several years slipped by with this impasse remaining the same.

THE SMUGGLING OF BOOKS

<m 9

With Opium and Gold: The Smuggling of Books

If only the GRC could contain the distribution of pirated reprints to the island of Taiwan. . . . Few outside observers felt it could do so, and indeed many Chinese themselves felt that the export embargo was simply a paper concession to American pressure which was never intended to be fully enforced. The profits in book exportation were large, and the penalties for violation of the ban were slight, so there was incentive for the practice to continue. Almost all officials of the GRC, however, took the ban very seriously. The order which placed foreign-language books on the export control list was issued by the Foreign Exchange and Trade Control Commission on March 23, 1960, and was ratified by the Cabinet on the day following. On March 25 the Inspectorate General of Customs issued to the Customs Offices at the ports of Keelung in the north and the down-island harbor of Kaohsiung, as well as in the air terminals at Taipei and Tainan, instructions to seize books that were not properly cleared for export. This order involved the examination of the baggage of all outgoing passengers, as is the normal practice in Taiwan, and of outgoing packages at the time customs declarations were made prior to their final sealing. On April 19 the Directorate General of Posts ordered the Postmasters to seize and return to the sender any foreign-language books being mailed to an overseas address. It was recognized that a likely loophole existed here, however, because of the difficulty of detecting packages of books unless they were unusually large shipments, and it was believed that most book shipments were small. Although the United States

101

Post Office released word on April 8 that it had already intercepted fifteen packages of books originating in Taiwan, raising apprehension in the States that the ban was not being enforced, it is clear that they were mailed prior even to the initial order of March 23 and certainly before the Taiwan postal embargo was instituted on April 19. Little has been said to this time about the substantial sale of pirated English-language reprints to American personnel resident and transient in Taiwan. United States servicemen and their families, employees of government agencies, contractors, and others in the private sector, missionaries, and tourists, all constituted an enormous English reading market, and the number of best-sellers reprinted on the island rose rapidly to fill their demands alone. Several well-stocked bestseller bookstores were soon established on Chungsljan Road North near the American compound and close to the President and Grand Hotels which are popular with American transients. Far from limiting their buying, however, to popular trade books, this group had also been purchasing many of the bargain-priced text and reference volumes to be taken or sent back to the United States. An effective export ban would have to! take this group of resident American nationals into account as wfell as the native Taiwanese,, and in April the GRC advised the United States Army Postal Office (APO) to take such steps as appeared necessary to keep printed books from the APO mails. An instruction was immediately issued by the Commander of the United States Taiwan Defense Command instructing U.S. personnel concerning the nonmailable nature of publications that violated American copyrights and warning of the severe penalties that could be imposed for mailing such matter. It forbade the use of military postal facilities for the shipment of pirated books from Taiwan, and it ordered officers who were authorized to certify gifts and to sign customs declarations not to sign for any packages containing such literature. The American Embassy distributed a similar advisory document to all

102

BOOK PIRATING IN TAIWAN

United States government agencies in Taiwan. With these measures the volume of book exportation from the island began rapidly to dwindle. Exportation did not end entirely, but what remained was driven underground. The GRC invited submission of hard evidence of contravention of the ban so that it could take action against smugglers, but such evidence was difficult to come by. There were some efforts by Western book interests at entrapment. In March; Joseph Marks of Doubleday ordered and received by mail a copy of Webster's Unabridged Dictionary from Tan Chiang, but the package was postmarked in Taipei on March 23, a day prior to ratification of the ban. Some fifty pirated reprints were received from Tan Chiang on the Iowa State University campus on April 22, but they too had been shipped prior to the ban. In general, suspicious-looking packages being shipped from Taiwan to American addresses were soon being quite carefully and effectively screened by GRC agencies. It soon appeared, however, that the same degree of scrutiny was not being given in the Chinese customs and mails to packages being shipped elsewhere in the world. Hong Kong especially turned up as a frequent recipient of Taiwan reprints and was in fact rather often used by smugglers in the early days of the ban as a mail drop for illicit transshipments to United States patrons. A typical example of this subterfuge was supplied to the ABPC-ATPI by the storied Hong Kong investigator, F. W. Kendall, who had been retained by the Council and Institute to watchdog the Hong Kong scene. On July 19, 1960, he furnished photographs of a package of pirated Taiwan books that had come into his possession bearing a mail cancellation stamp reading "Taiwan 28-6-60 Keelung," indicating that it had been posted in the Formosan port city more than two months after the postal ban had been promulgated. The return address was "331 Kung Leung Road, Keelung," but it was written on a slip of paper pasted onto the package, which, when

THE SMUGGLING OF BOOKS

103

removed, revealed beneath it the name and address of [Taiwan's best known pirate-smuggler, Far East Book Company, j Hong Kong was ideally situated in several respects to serve conspiratorially for Taipei book smugglers. On August 10, 1963, the London trade paper Bookseller carried another report on the subject from the intrepid Mr. Kendall. He wrote: The fact remains that ships' crews on vessels plying between Taiwan and Hongkong are ostensibly the most educated seamen in the world. In one classic case Ito my certain knowledge, each member of a ship's crew ntimbering 36, brought into Hongkong a complete set iof the Encyclopaedia Britannica. Multiply this by 20 to 30 sailings a month and you reach a healthy aggregate. This is by no means the only way of importing books. A recent seizure made by Hongkong Customs authorities involved a number of packing cases manifested as salt vegetables. These in fact contained over 1,000 pirated books including Oxford dictionaries. This particular shipment of smuggled books had arrived in Hong Kong aboard the Hai An out of Keelung and Was consigned,- strangely enough but in the best Oriental tradition, to a Kowloon jade broker. j Taiwan books were not being smuggled into Hong Kong alone. In August 1962 there was considerable concern about their extensive sale in Australia where they turned up in use at a government installation and at several universities. Apparently their distribution there was rather widespread, especially in Auckland. They also went in large numbers to Macao which, as Hong Kong, served as an ideal mail drop for transshipment. One Macao operative was closed out by GRC action in June of 1963. A certain Mr. Chan was alleged to have been using a Taipei Post Office Box for the illegal exportation of pirated books through a Macao cohort, but the GRC had only

104

BOOK PIRATING IN TAIWAN

circumstantial evidence of his activities. It therefore had the Post Office cancel his P.O. Box, and word was soon passed that Mr. Chan was losing money because of his inability to receive and fulfill book orders from foreign countries. Any place, of course, and anyone could serve as a mail drop, and Publishers' Weekly on August 20, 1962, quoted a letter received from a Taipei pirate in response to an order from the United States. The bookseller regretted that the U.S. Customs Dept. announced recently they would not allow our friends' shipment of books into U.S.A. We hope you can give us your relatives' or friends' address not in U.S. (such as Canada, South America, Europe or some other places outside U.S.A.), so that we may . . . send your books to them, and when they receive the books, they send them to you. We believe by this way you will receive your books. . . . We think this is the excellent way. . . . Could this have been written with tongue-in-cheek? Probably not. ,: The rapidly growing higher education industry in Korea made that country a good market for smuggled reprints, too. In mid-1963 Henry M. Snyder & Company's East Asian representative reported that Korea was "flooded" with Taiwan piracies, and although the term "flooded" may be subject to differing interpretations, there is no question but that some such books went there in the early days of the ban. The S.S. President Lincoln, for example, arrived in Pusan Harbor in mid-July 1963 carrying eleven cases of Taiwan books consigned to a firm in Seoul, and it was alleged, although never verified, that the books were pirated reprints. This gossip prompted closer surveillance of the trade in Korea, and several months later it was rumored that an "industrial company" in Seoul had ordered 6,568 books to be delivered by the same Taipei shipper. Upon learning of the rumor, GRC officials confirmed that such a shipment was scheduled to leave Keelung on the S.S. Washington Bear of the Pacific Far East Lines. A special joint inspection detail was dispatched

THE SMUGGLING OF BOOKS

105

from Taipei to Keelung Harbor, and a thorough examination was made of the suspect shipment when it was presented for customs clearance. Each of eight cases was broken open and checked closely against the cargo manifest, but each contained Chinese language books only. One must draw his own conclusions as to what had happened. And books went elsewhere. . . . About this same time Van Nostrand's representative reported a loophole of a different kind in the Customs Bureau's coverage. He described his experience with it as follows: Chinese students going for studies abroad are ailowed to take with them one copy each of texts that must receive the stamped prior approval of the Ministry of Education, otherwise Customs officials confiscate them at th£ time of departure. This provision is, however, not observed as students in Taiwan do export books. On the plane sitting with me were two Taiwan students going to Seoul. Each had a bulging pair of hand bags loaded with books. They got off the plane with these in Tokyo, but returned to the plane without the bags. Books of Taiwan origin similarly turned up in larger or smaller quantities almost any place there was a Chinese community for the Taiwan smugglers to do business with: Indonesia, the Philippines, Singapore, Thailand, and elsewhere. A thorny problem continued to be the aforementioned American "smugglers" themselves. A choice example involved the vigorous ingenuity of one of Taipei's best-known pirates who in 1963 sold out his 1,500-copy printing of Webster's Third New International Dictionary by an imaginative but ancient marketing method. He simply hired a boat, loaded it with the books, pulled alongside U.S. warships calling in Keelung harbor, and sold them at N.T. $250 (U.S. $6.25) apiece to American naval personnel aboard. As American servicemen came thus to know of this cheap source of books, it is probably not surprising that they continued on occasion to turn up in use

106

BOOK PIRATING IN TAIWAN

on American college campuses. Foreign students, of course, also contributed to the incidence of such use—as at Cornell in 1964 where a graduate student from Indonesia supposedly purveyed to his colleagues books pirated in Taiwan. When the use of smuggled books on American campuses became known to their administrators, most moved promptly and without fanfare to end the practice. Some, however, received considerable publicity. An example of the latter occurred at Massachusetts Institute of Technology in 1962 where four students were expelled for marketing Taiwan books. These students reportedly established the so-called Tech Textbook Agency to import pirated reprints for sale to college students in the area. The case was broken, however, before any of the books were sold. Evidence of all known cases in which Taiwan reprints had evaded the export ban was handed over promptly to officials of the Government of the Republic of China, which took action to tighten its embargo screen as rapidly as gaps in it came to attention. Given this kind of surveillance, book .smuggling was increasingly throttled between 1960 and 1963, but it did not end entirely.: Indignant and oversuspicious American interests, moreover, were to remain unappeased as long as a single pirated book was finding its way to market off the island, and a similar level of concern was also felt within the ministries of the GRC, which was coming now to feel that its honor was at stake. It had assured Western interests that pirated books would not be permitted out of the country, yet unquestionably some such books were still managing to get to foreign markets. The original 1960 export ban had been repeated and strengthened by the executive Yuan on August 22, 1962, but it had not yet become comfortably effective. In late 1963 therefore the GRC issued two separate orders aimed at resolving the issue once and for all. The more important of the two was signed on October 30. It forbade the carrying off of Taiwan of single copies of books by students, which had been allowed under the 1960 embargo. Far more

THE SMUGGLING OF BOOKS

107

significantly, however, it made apprehended smuggler!? liable to criminal action for the first time under the Statute for Punishment of Smuggling, rather than under the foreign exchange and trade control regulations. Thus book smuggling was jnow on a par with the smuggling of opium or gold and was punishable by up to seven years' imprisonment and fines of N.T. $23,000 (U.S. $575), which was truly a small fortune. The second GRC order, issued a week later, added confiscation of detected books to the usual enforcement measures. Postal and custonjs officials had previously simply refused to accept reprinted foreign-language books for export. Following issuance of these orders, the low remaining volume of export was even further curtailed.! Penalties were now much too severe for anyone in the legitimate Taiwan book trade even to consider exporting his wares—and almost all of the firms producing and marketing books there viewed their operations as being legitimate. If anyone in Taiwan were going to be caught exporting from here on, it would have to be either a professional smuggler or a truly unscrupulous member of the clandestine book community, of whom the number has always been small. A few complaints of book smuggling continued to filter into the American publishing industry, but those that could be checked out usually proved to be misunderstandings. One shipment of Taiwan books found in Malaysia ihad been received prior to the new regulations and kept in stock for a while. A book found in Bangkok had been carried off Taiwan by an airline pilot who needed reading matter to while away his energies during a long flight. At least one stock of books seems to have been counterfeited elsewhere—perhaps on the China Mainland—to look like a Taiwan product. But the relatively free international flow of smuggled Taiwan books that had existed in the opening years of the decade clearly was no more. In fact, it was fully seven months later that the next clear-cut case of Taiwan book smuggling in quantity came to light. In mid-July 1964, bookstores in Manila were approached by

108

BOOK PIRATING IN TAIWAN

agents who offered immediate delivery of large quantities of more than one hundred titles of pirated Taiwan reprints. To each prospective buyer the agents either gave the same contact, a Mr. Keh Alfonso, or offered delivery to a certain China Lace Store in Cruz. The publishing community in Manila was immediately aroused at this illicit incursion into their usual sales area and reported the incident promptly to the American Embassy and to the Philippine National Bureau of Investigation. Alfonso Fajatin, the Philippine representative of Feffer & Simons, attempted with some success to track down the smuggler in hopes of buying something from him to be used as evidence. Using a pseudonym and posing as a quantity book purchaser from Cebu City, he managed to contact Keh Alfonso by telephone and made an appointment to meet him near several bookstores at the Cinerama in Azcarraga Street. When Mr. Alfonso, who turned out to be Chinese, arrived at the rendezvous he had three Filipino companions with him. Fajatin became a bit shaky because while they were talking the Filipinos kept lurking behind j him inquiring if he had ready cash to pay for immediate delivery. Fearing that he was about to be attacked and robbed, he claimed he had only two pesos in his pocket but that he would bring rnore cash to a meeting at eight o'clock that night. Understandably, Mr. Fajatin did not attend the second meeting so he never got his evidence, but he confirmed—to his own satisfaction at least—that large stocks of Taiwan reprints were already in Manila awaiting distribution to any interested buyers. Alfredo S. Nicdao, Jr., Philippine representative for Wiley, South-Western, and Rand McNally, reported a short time later that the pirated reprints were available in even larger quantities in the university town of Cebu City in the Southern Islands. Here again it was Keh Alfonso of Manila who was the peddler. The pressure there for the cheap reprints became so great among the students that legitimate bookstores were forced to lay in stocks of them in order to keep their customers. The Philippines had been among the original subscribers to the

THE SMUGGLING OF BOOKS

109

UCC, but the status of its commitment to the Convention was vague and ambiguous, and few American books had (been copyrighted there, so the sale of Taiwan reprints in the Filipino bookstores was at best of doubtful illegality. Theif importer, however, risked being charged under statutes related to unfair competition, economic subversion, and likely tax evasion and customs violations. The issue was worked on at length in official channels involving the Government of the Republic of the Philippines; the American Embassies in Taipei, Manila, and Djakarta (since it was rumored that the pirated books had entered the Islands through Indonesia); and of course by j the GRC, which went to work immediately to determine how the books had got loose from its shores. For a time there was belief in some quarters that they had left Taiwan prior to the October 30 strengthening of the export embargo, but this was unlikely since most smuggling interests did not have the capital to permit such a large stock of contraband to wait long for a buyer. It appeared rather clearly to be a case of current smuggling. A great flurry of concern for smuggling arose in Hong Kong early in 1963. On April 8 Hong Kong police seized several trunks from a seaman aboard the S. S. Nellore, a Pacific & Orient Line ship. The trunks contained 105 Taiwan reprints of American mathematics and science texts which a j sailor had allegedly purchased for U.S. $80 while his ship was Stopped in Keelung. The shipment, apparently destined for a student at New Asia College, was accompanied by two book catalogues from Taipei's Central Book Company. Central, it subsequently developed, had sold the books to a private party who had himself exported them. F. W. Kendall was retained by the ABPC to press piracy charges in Hong Kong, and the sailor involved—one Wong Siu-Ying—turned Crown witness. What started out as a neat, clear case of piracy in Hong Kong, however, soon became extremely complicated. At a simple hearing before a magistrate two weeks later, counsel for the defense attacked the Hong Kong copyright ordinance

HO

BOOK PIRATING IN TAIWAN

itself, claiming that it drew; its support from the British Copyright Act of 1911 which had been extended the next year to the Crown Colony; the 1911 Act, however, had really been superseded in the United Kingdom by a new Act in 1956 which had never been made to apply to Hong Kong. Perhaps therefore there was no copyright protection at all in the colony. With this new development, the court adjourned to study the matter. On May 28, 1965, the charge against Wong Siu-Ying was dismissed, but not on the above basis. It was rather felt that no one of the three facts needed to clinch the case against the defendant had been proved by the prosecution. These were: 1. that the originals of the pirated books were protected by copyright; 2. that the seized books were illegal copies of copyrighted books; 3. that the defendant had ordered the books for purposes of resale. Not only was the defendant released, but all of the 105 pirated books seized from him were returned as well. The case of Regina v. Wong Siu-Ying did nothing to answer the questions raised by the defense concerning the protection of Western copyrights in Hong Kong, but it did make this possible legal loophole widely known among interested parties. Considerable furor ensued in the ABPC especially and in the Department of State regarding the issue, and for some time it appeared that no American books could obtain protection in Hong Kong unless they were first or simultaneously published there. Eventually, however, it became clear that the Crown Colony was covered by the Berne Convention. Although the United States is not signatory to this Convention, protection is at least guaranteed to such American books as are simultaneously issued in any country which is party to it. A majority, of course, of the most salable American books are so issued simul-

THE SMUGGLING OF BOOKS

HI

taneously elsewhere. This particular issue remains somewjhat cloudy today, however. Meanwhile back in Taipei it was clear that smuggling was indeed taking place somewhere, and intensive police investigation of the clues developed by such casesj as those involving Manila and Hong Kong was beginning to bjsar fruit. A "landmark" case broke in Taipei on August 3, 1965. On that date the vernacular and English-language press in Taiwan reported that warrants had been issued for the arrests oij Li Hsi-Hsiung and Huang Ta-Chun, proprietors of the Chinnjien Record Company, for involvement in a smuggling ring which had for two years been exporting pirated books and phonograph records to the other countries of East Asia. Real evidence in the case had apparently been found in May when postal and customs officers in Keelung discovered more than one hundred parcel post packages, weighing from ten to twenty-two poupds each, containing pirated books or records and documented with false customs declarations and incorrect return addresses. Following further investigation the case was remanded to the Taipei District Court which, on November 8, found indictments against a total of twenty-nine persons on from one to five counts, each connected with smuggling. The charges were forgery, fraud, smuggling, dereliction of duty, and violation of the National Mobilization Act. Illegal shipments!, it was determined, had been widely distributed to such places as the Philippines, Hong Kong, Vietnam, the United States, Thailand, Macao, Singapore, Sarawak, and Malaysia. The case came to trial in mid-January 1966, and twenty-one of the twenty-nine persons indicted received severe sentences. The heaviest penalty was drawn by one Lin WuHsiung, chief of the parcel post section of the Taipei Post Office, who was sentenced to seven years' imprisonment. The twentynine-year-old Lin, the Court found, received properties valued at N.T. $288,277 (U.S. $7,200) in return for placing surface mail parcels of smuggled books and records into the airmail

112

BOOK PIRATING IN TAIWAN

bags out of Taipei so they would circumvent the Keelung customs inspection. In addition to Lin's conviction, four other civil servants were found guilty and sentenced, as were three students, one laborer, and twelve businessmen, some of whom were professional smugglers. Perhaps the most interesting conviction so far as this report is concerned, was that of Hsu Yung-Fa, proprietor of the Fair East Book Company. Hsu confessed that he had accepted orders from one of the other defendants for books to be sent to the Philippines, but he claimed that he was ignorant of the laws about smuggling. The Court did not believe his protestations, however, and sentenced him to two months' imprisonment, the lightness of the sentence resulting from the fact that he had abetted rather than committed a crime. Strangely this case of such considerable importance to American publishing interests was never widely publicized in the United States. The general severity of the punishment meted out: to the twenty-one persons found guilty, however, was extensively recognized in Taiwan as clear manifestation that the GRC would not tolerate book smuggling. Since the dramatic disposition of this court case in early 1966 there have been no additional responsibly reported claims of quantity book smuggling from the island.

8©

10 Hope Springs Eternal) . . . New Efforts to Bargain

The situation during the first half of the decade of the 1960's cannot be more succinctly described than in the words of Assistant Secretary of State Frederick G. Dutton, who wrote to Senator Carl Hayden, Chairman of the Committee on Appropriations, as follows on August 16, 1963: Since January 1962, the American publishers' groups have coupled any willingness on their part to consider a low-cost reprint arrangement with the condition that the GRC first simplify and reduce the cost of its registration procedures. On its part, the GRC has evidenced a reluctance to change its procedures or to enter into any copyright arrangement unless low-price reprint editions continue to be available. The present situation regarding a reprint program is a stalemate. The one thing, however, that continued to change dufing what was otherwise a standoff was the number of American titles reprinted in pirated editions in Taiwan. By the end of 1963 no fewer than 3,700 such titles were available in print there. A year later the number was reported at 4,600 and was still rising. The climate of opinion in the Republic of China, however, very much favored the negotiation between Taiwan and American book interests of some kind of authorized reprint program which would legitimize the industry there while not substantially increasing the price of books to Chinese students. Furthermore, the GRC was willing to listen constructively to all reasonable requests for modification in its supervision of the local book industry and to make such changes as appeared

114

BOOK PIRATING IN TAIWAN

feasible. Several small but not inconsequential alterations were made by the executive Yuan on August 4, 1963. There were two among them that were of considerable interest to Americans. The first ordered the preparation in English as well as in Chinese of application forms for book registration with the MOI, presumably so that foreign publishers could apply direct for registration of their books without having to go to the expense of retaining a third party to execute the procedures in their behalf; strangely, these English-language forms were still not available well over a year later. The second was that the fee for registration, while remaining for the time being at ten times the price of the book, could thereafter be collected on the basis of the New Taiwan dollar selling price of the Chinese edition when there was one; the purpose of this arrangement was avowedly to encourage Chinese book merchants to contract with foreign publishers for permission to reprint. The next conciliatory steps taken by the GRC were the orders of October 30 and November 6, already discussed, which instituted severe penalties for book smuggling. Also, in November 1963 the Ministry of Interior called all Taiwan publishers to a special meeting and warned them that they would be expected thereafter to adhere to the letter of a law, previously observed more in its breach, requiring that the names of local printers and publishers appear on all pirated books and that all new publications be reported. This move gave the MOI greater efficiency of control over the local book industry. As a follow-up to this meeting the Ministry in June of 1964 staged raids on printers in Taipei, Tainan, Taichung, and Kaohsiung, and confiscated 6,200 copies of pirated books. Chinese newspapers on July 9 reported that "of the seized copies, seven are banned as obscene books, 833 found not bearing copyright notice as prescribed by the Publication Law, and 536 published without license." The legislative Yuan passed a revision of the Chinese domestic copyright law effective July 13, 1964. Although it did not contain changes that contributed greatly to

N E W EFFORTS TO BARGAIN

115

reconciliation of the problems in Chinese-American bobk trade relations, the revision did substantially strengthen the GRC's ability to act against pirates of copyrighted books. Under the revision, for example, the aforementioned convicted pirate of the Encyclopedia of Science and Technology could have been imprisoned for two years instead of receiving the S30 fine reported earlier. The following month the executive Yuan established a high-level study commission to examine the entire range of problems involving the Taiwan foreign-language publishing industry. Minister of Interior Lien Chen-Tung himself was to act as convener, and also represented were to be the executive Yuan Secretariat; the Ministries of Foreign Affairs, Education, Justice, Finance, Communications and National Defense; the Council for International Economic Cooperation and Development; the Foreign Exchange and Trade Control Commission; the Government Information Office; the Taiwan Garrison Command; the Provincial Information Department; and the Provincial Police Department. The China News on August 29, 1964, described the work of the commission as follows: It will meet once a month. Its main job is to find out the current situation of book and record pirating, and if they are exported, how and by whom. The commission will also study how the problem of piracy, which has cost the Republic of China a considerable amount of good will among its American friends, can be solved once for all. The study commission had as its executive secretary one Hsiung Dun-Sheng, director of the MOI's Department of Publications Administration. A lawyer by profession, the young and gracious Mr. Hsiung had learned well the complex dynamics of accomplishment within the executive Yuan. He had earned the acceptance not only of his colleagues in government, but of the people in the Taiwan and American book industries and in the United States government agencies in the Republic of China as well. His diligent surveillance of the Taiwan book

116

BOOK PIRATING IN TAIWAN

trade in recent years has done much toward keeping it under control. Few concrete accomplishments can be attributed to this study commission, but it probably served a useful function nonetheless. In the first place, it generated a high level of concern and a fairly uniform climate of response for the problem within the Cabinet of the GRC. Second, through a carefully prepared program of public education and a judiciously placed series of press releases during 1964 and 1965, it contributed considerably to awareness of the problem among the Chinese people themselves. Articles and editorials appeared in the vernacular press which, although consistently siding with cheap textbooks, generally advocated the elimination of piracy. Most of this press response was due to a calculated effort within the MOI, and under Mr. Hsiung's direct supervision, was designed to condition public opinion to the true issues involved. American publishers meanwhile, concerned over the continuing rise in the cost of producing their Asian editions in Japan, observed increasing GRC control over the book trade and the steady improvement in the quality of Taiwan reprints, and they wondered if a time would come when Nationalist China would serve as a major source of cheap books for Asian students. Their first problem, some felt, would be to find a Taiwanese firm to do business with that had not been tainted by past piracy activities; such firms of course did not exist, and it was unrealistic to expect to find any. Almost all of the Taiwan reprinters had done exactly what good businessmen have always done everywhere—they operated their activities to the limit of the law in the interest of profits and what they felt to be the public good. Onto the New York scene thus obfuscated by conflicting concerns and emotions there came at this time a member of the Taipei Embassy staff to explain the view from the other side. Dr. Harry E. T. Thayer, who had for some time been the American economic officer responsible for handling the problem of Taiwan piracy, met on July 17, 1964, with represen-

NEW EFFORTS TO BARGAIN

117

tatives of the United States industry in the offices of the American Book Publishers Council in New York. At the conclusion of a thorough review of all aspects of the situation and of I GRC actions and attitudes toward it, there was cautious consensus within the group that the possibility of an enlarged authorized reprint program should again be explored. | In this increasingly healthy climate of publr and official opinion, all parties involved came to feel that an era was approaching wherein face-to-face negotiations would be fruitful. American publishers' representatives, of course, had long been trekking in and out of the Republic, but there had been no concerted effort to exchange views and to air complaints between the book industries of the two countries—and no Chinese foreign-language publishers had ever visited the United States. American bookman Bruce Rogers was in Taiwan in early 1964, and his report represented the situation!there in somewhat softer tones than had those of most of his predecessors. "Perhaps the American publishers should take a realistic view of the situation;" he wrote, "and not profess such high moral indignation? Accept the situation and see where advantage can be reaped from it." He pointed out that, if Taiwan reprinters received authorization to do their work: 1. they could, by having been given exclusive rights, register and protect those rights themselves, as is dfrie in other countries; 2. since Taiwan reprinters were ready to pay royalties, American publishers would at least receive x percent of something instead of 100 percent of nothing; 3. American firms could save their legal fees; booksellers would look after the Americans' interests because these would be their own interests as well; 4. American publishers would need to put up no capital and would have no expense. As a culmination of all of these conciliatory actions and views, serious, official, face-to-face negotiations

118

BOOK PIRATING IN TAIWAN

were eventually established between the book industries of the two nations. They began with two visits to Taiwan early in 1965 by senior men from the American book industry. The first was Leo Albert, President of Prentice-Hall International. The stated purpose of his visit was to obtain firsthand information in preparation for a visit by an official representative of the American industry to come shortly thereafter. Mr. Albert made an extensive circuit of calls on officials in the GRC, the American Mission, and the Chinese book industry. His factual report was generally optimistic and indicated that his meetings and conversations with the pirates themselves were healthy. In March of 1965 Basil Dandison, Senior Vice President of the McGraw-Hill Book Company, made an official round of visits to informed persons in Taiwan seeking in the name of American book interests a final resolution of the piracy problem that could be beneficial on both sides of the Pacific. Again a simple but valuable product of the visit was a greater awareness on the parts both of the antagonists and the protagonists of one another's views and problems. By far the most far-reaching outcome of the visits to Taiwan by Messrs. Albert and Dandison, however, was a proposal that the so-called Global Royalty Fund (GRF), an instrumentality of the United States Agency for International Development (AID), be utilized to bring some order out of the chaotic Taiwan publishing community. The GRF had been established in 1964 for the purpose of enabling AID to subsidize, through the payment of requisite royalties, the local production in emerging countries of reprints of books it felt to be in the best interests of the economic and educational objectives of those countries. The proposal now was that Taiwan booksellers might be authorized by American houses to reprint small editions of certain books approved by AID in return for an initial advance against royalties to be paid from the Global Royalty Fund. The likely salutary effects of such a program were envisioned in Mr. Dandison's report to the ABPC-ATPI on April 19, 1965, as follows:

NEW EFFORTS TO BARGAIN

119

The advent of the subsidy made available to U.S. publishers by the U.S.. government should gradually bring order to the reprinting of U.S. textual materials in Taiwan. It should strengthen the reputable publishers and tend to discourage the pirates from engaging in their business. The Ministry of the Interior, which is charged with the responsibility of taking remedial action with piracy, has stated that if sufficient textual materials needed in the English language can be made available by methods agreed upon by the U.S. and Chinese .governments and publishers, the Ministry will work toward eliminating all other unauthorized reprint?. All parties closely involved were impressed with the potentialities of the GRF scheme as applied to Taiwan. AID/Washington promptly concurred in principle and suggested that a sum of $25,000 might be authorized for FY 1)966 to cover royalties, not to exceed $500 per title, on some fifty titles. The Joint International Trade Committee of the American Book Publishers Council and the American Textbook Publishers Institute, which between them represented firms and organizations publishing 95 percent of the books produced in the United States, in August 1965 produced a document recommending to their members appropriate procedures for selling English-language reprint rights to Taiwan booksellers under the GRF plan. In the Republic of China the scheme was hailed as the first clear-cut manifestation that American interests recognized and were seriously concerned about the book needs of Chinese students. Remaining as a major stumbling block to many American firms was knowing just which of the Taipei booksellers could be trusted as business partners and which could not. All had, of course, been pirates and many Americans were inclined to overlook the fact that piracy was legal and instead to imagine extrapolation of that activity to other nefarious activities of innumerable kinds. Most of the people working in the Taiwan book trade in 1965 had been in the industry for a long

120

BOOK PIRATING IN TAIWAN

time. At the head, of course, of everyone's list was Choh ChinShin of Southeast and New Moon, followed closely by Rainbow-Bridge's Sun Kuo-Jen, Tan Chiang's Chiu Ju-Shen, Central's T. K. Lin, Eurasia's Liao Chin-Chin, and Far East's incorrigible Hsu Yung-Fa, all of whom have been mentioned here before. There were some new names too, however, including a former police officer named Jack C. Chow whose Bookcase Shop near the hotel district had reprinted an enviable list of best-sellers; Min Hwa, a professor at the National Medical Institute and owner of the University Book Company which had reprinted medical books; Chen Kuan-Yau, whose Universal Book Company had also reprinted medical books; and Hann Tao-Tsung, whose Hsin Lou Book Company had successfully pirated the World Book in a 1,500-copy edition a year earlier. There were also reprinters in the down-island cities of Tainan, Taichung, and Kaohsiung, and at least one—China Arts Gallery —was working in Keelung. The extent of the work of these several firms is shown in Table I, which lists them all and the number of in-print i English-language titles each contributed to the 1965 combined Taiwan catalogue of books. There was also another newcomer on the scene —one who was destined to shake up the entire Taiwan reprint industry. His name^ was Sueling Li. Born on the China Mainland, he had spent most of his life in the United States, and had received an American education capped with a degree from the Wharton School of Business at the University of Pennsylvania. An American citizen, Mr. Li had worked successfully in several industries both in New York and in Taiwan—including dealing in grain, hog bristles, frozen foods, and other diverse interests. Sueling Li's father—also a man of wide-ranging business talents and interests—was chairman of the board of the old, highly respected Chinese-language publishing house named Chung Hwa, and the younger man came increasingly to share his father's interest in the book industry. He saw especially that English-language reprinting had an enormous potential in Taiwan, if the industry could only somehow be legitimized, and he

Table I. Subject Distribution of Titles Reprinted by Taiwanese Firmsjand Contributed to the 1965 Combined Catalogue of English Language Books In Print in Taiwan

>o o