The WTO on Monday ruled against China in a copyright protection dispute with the US — a move hailed by Washington as “an important victory.”
“The Panel recommends ... that China bring the Copyright Law and the Customs measures into conformity with its obligations,” the WTO dispute settlement panel said in the ruling.
The clash over intellectual property rights (IPR) was the fourth case involving a formal US challenge to trade practices in China, whose ballooning trade surplus and handling of counterfeit goods has in recent years been a political flashpoint.
The US had claimed in its complaint first filed in 2007 that Beijing’s legal structure for protecting and enforcing copyright and trademark protections is unfairly deficient and does not comply with WTO rules.
Chinese-made counterfeit goods — from software and DVDs to luxury leather goods and watches — are widely available in the US.
Washington’s complaint targeted alleged shortcomings in patent protection for imported products in China, as well as in Chinese copyright law.
It also claimed that some counterfeit goods seized by Chinese authorities find their way back into the market.
On Monday, the WTO ruled that Chinese copyright law and some customs measures failed to provide sufficient protection.
However, it fell short of ruling that Beijing made it too difficult for pirates and counterfeiters to be prosecuted.
Acting US Trade Representative Peter Allgeier said in a statement it was “disappointing” that the panel failed to establish that China’s criminal law imposed overly high thresholds for prosecution.
But he described the overall ruling as an “important victory.”
“These findings are an important victory because they confirm the importance of IPR protection and enforcement, and clarify key enforcement provisions of the TRIPS Agreement,” Allgeier said.
The TRIPS agreement refers to trade rules on the issue of intellectual property agreed by WTO member states.
“Having achieved this significant legal ruling, we will engage vigorously with China on appropriate corrective actions to ensure that US rights holders obtain the benefits of this decision,” Allgeier said.
Meanwhile, Chinese Ministry of Commerce spokesman Yao Jian (姚堅) said in a brief statement yesterday that Beijing had made great progress in curbing piracy and expressed regret that the WTO panel had not found in China’s favor in areas such as copyright law.
He welcomed the panel’s decision against one major US claim, that copyright pirates had no fear of criminal prosecution because the Chinese government’s threshold for bringing a case was too high.
But Yao, in one of his government’s first comments on a China-US trade dispute since US President Barack Obama took office last week, also promised that China would work with the international community to resolve the issue.
“As we strengthen our work on domestic intellectual property rights, we will continue to promote international exchanges and cooperation, in order to encourage the healthy development of trade relations,” he said without elaborating.
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