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The way this works out is this. You are the Chinese government. The following are some of your objectives:
1. How do we assert our tyranny and absolute lack of respect for any democratic form of existance?
2. How do we assert being the unwarranted cynosure for capitalist companies?
3. How do we abuse this unique position rendered to us by stupid companies?
4. How do we help our legal system, our cyber-squatters, and in general anyone who will benefit, grab money from these companies?
The answer: The New Law. While one country goes around abusing the internet with stupid laws that disallow you from "annoying people anonymously", another is being very smart.
Now you own a company called cBay. You become very famous in the US. The erstwhile Wall Street Journal publishes a snippet that you might be eyeing China, the next big market (always the next, for the last guzillion years). And then, lo and behold, some dude in Shangai registers your domain cBay.cn .
Across the ocean, somewhere in Europe, say, someone does the same thing with .uk
You hire the UK government and its laws, if necessary the EU and its laws to beat the crap out of this guy and wrestle the domain from him, and maybe, also get him to pay the legal charges for the whole tussle.
Roll back to China. You sue this guy using China's ridiculous if nothing else, legal system. You fight for two years. Who ends up the loser?
If only the Indian government were 10% as smart as the Chinese government.
But given how the Indian Judiciary system delivers rapidfire justice.....