US files case over China piracy

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The US is to file a formal complaint against China at the World Trade Organization (WTO) over high levels of copyright piracy and counterfeiting.

A spokeswoman said the case was being lodged to tackle China's failure to enforce laws on copyright violation.

US software, music and book publishers say they lose billions of dollars of sales in China as a result of piracy.

In a separate WTO case, the US is to challenge market curbs in China to the sale of US movies, music and books.

We will continue to welcome dialogue with China in an effort to resolve these issues US trade representative Susan Schwab

US trade representative Susan Schwab said piracy and counterfeiting levels in China "remain unacceptably high."

"Inadequate protection of intellectual property rights in China costs US firms and workers billions of dollars each year."

"Because bilateral dialogue has not resolved our concerns, we are taking the next step in requesting WTO consultations. We will continue to welcome dialogue with China in an effort to resolve these issues," she said.

According to the US government, despite official Chinese promises of a crackdown fake software, DVDs, some luxury goods, car parts, shoes and other goods are still widely available throughout the country.

The US has been threatening a WTO complaint against China since 2005.

The other complaint accuses Chinese distribution rules of making it difficult for cultural goods such as books and Hollywood films to reach Chinese consumers.

Sanctions threat

The complaints are to be filed at WTO headquarters on Tuesday.

A 60-day consultation period follows for negotiators to try to resolve the disagreements.

If this fails, panels will rule on the case. This could allow the US - if it wins - to impose economic sanctions on Chinese goods.

The move is being seen by some as a result of pressure over the rising US trade deficit - which stood at $765.3bn (£390.1bn) for 2006.

China had a surplus of $232.5bn in trade with the US - the highest ever seen from one nation.

The Motion Picture Association of America welcomed the move from Washington, saying that it lost about $2.3bn in revenue in China due to pirating in 2005, saying only 10% of DVDs sold there were legal.

"China is, by virtually any and every measure, the world's largest marketplace for pirated goods," the association's chairman Dan Glickman said.

Critical

Observers have said that the efforts to increase pressure on Beijing have come about because the Democrats - many of who are critical of China's trade methods, have control of the House of Representatives and the Senate.

In June 2006, European Union Trade Commissioner Peter Mandelson made a fresh call for China to do more to improve market access and cut down on piracy.

He warned China would face a backlash in Europe unless it did more to "apply rather than circumvent the rules".