U.S. considering next move on China piracy
By Doug Palmer
WASHINGTON (Reuters) - The United States gave China more time last year to reduce widespread piracy and counterfeiting of U.S. goods, but is again considering whether to take legal action at the World Trade Organization, a top U.S. trade official said on Thursday.
"Last October, we informed China we would be filing such a case, but then agreed to hold off, with the support of U.S. industry, when China asked for further bilateral discussion," Deputy U.S. Trade Representative Karan Bhatia said at a House of Representatives hearing on China trade issues.
Five months later, "No settlement has been reached," Bhatia said in prepared testimony for the hearing. "If it becomes clear that negotiations will not be successful, then we will proceed with WTO dispute settlement."
The United States has been threatening a WTO complaint against China for failing to enforce U.S. intellectual property rights for at least a year or more.
U.S. software, music and book publishers estimate they lose billion of dollars of sales annually in China because of piracy. Other American companies are also hurt by Chinese sales of counterfeit drugs, auto parts and other goods.
Bhatia said the Bush administration was consulting with Congress and industry before deciding its next move.
"The Chinese government, at a senior level is saying the right thing. China's got laws and regulations. The problem that we're seeing is not very much improvement in terms of piracy and counterfeiting levels," he told reporters.
"Our preference, and I think this is supported by industry, is to obtain real results that resolve problems. And if that is possible through dialogue, that's worth pursuing as a first option," Bhatia said.
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Rep. Sander Levin, a Michigan Democrat who chairs the House Ways and Means trade subcommittee, said the United States had already waited too long before bringing a WTO case.
The United States also should demand China show significant improvement in its protection of intellectual property rights by the time it hosts the Olympics in 2008, Levin said.
Industry groups told the Ways and Means panel they wanted to see substantial progress soon or would support the Bush administration in bringing a case at the WTO.
"We've all been humored by the Chinese government over and over again," said Patricia Schroeder, president of the Association of American Publishers. "I think everybody is prepared to take action if we can't get somewhere."
Dan Glickman, president of the Motion Picture Association of America, endorsed Levin's suggestion of setting the 2008 Olympics as a deadline for significant progress.
"They have an opportunity to show the world they're going to play by the rules or they have an opportunity to show the world that they're going to be an outlaw," Glickman said.
At a separate hearing, Sen. Max Baucus, chairman of the Senate Finance Committee, said the administration would lose Congress' trust if it didn't enforce existing trade rules.
He urged U.S. Trade Representative Susan Schwab to step up the U.S. response to intellectual property right violations in China, a situation he called "embarrassing."
Reuters
