The US government yesterday announced its intention to file two legal complaints with the World Trade Organisation (WTO) against China to stem the high levels of piracy there and tackle limited market access.
US trade representative Susan Schwab said that insufficient protection for intellectual property rights in China has led to losses of billions in sales for US software, music and film companies.
The US government estimates that piracy costs its economy between US$200bn and US$250bn a year, with up to US$24bn lost alone from sales of pirated goods in China.
According to a 2004 report conducted by the International Intellectual Property Alliance, Chinese piracy levels in business software was at 91pc and piracy across the board in China between 1999 and 2004 was estimated to be at levels over 90pc.
In response to US pressure the Chinese government has extended the criminal penalties applicable to pirates of CDs, DVDs and other audiovisual meterials. Rather than incurring a fine, anyone now caught with over 500 counterfeit DVDs will face up to three years in prison.
This move by the Chinese legal system came after Jon Dudas, the director of the US Patent and Trademark Office, on a visit to Beijing last month urged Chinese officials to introduce steeper penalties.
The second complaint by the US government is in relation to their market access to China. The US government pointed out that when China joined the WTO it promised to open up its market but still only certain authorised state-owned companies can import DVDs, books and CDs, according to Schwab.
By Marie Boran