Since the adoption of the open-door policy in 1978, China has absorbed huge amount of foreign investments. Billions of dollars have been poured into China market to set up as many as 350,000 foreign-invested enterprises in the country in the past 22 years. At the same time, China comes to realize from what has happened in the highly developed countries that advanced technology is essential to drive the country to modernization. Greater importance has been attached to the introduction of advanced technology from the industrialized nations. Under the policy of encouraging the acquisition of sophisticated or advanced foreign technology, foreign investors are allowed to contribute their technology to the joint ventures in China as part of their investments in these entities. With this practice, it seems to be necessary for foreign investor to be informed of the relevant intellectual property issues in the establishment and management of a joint venture or wholly owned subsidiary in China.
