U.S. Ramps Up Piracy Battle Against China

The move at the WTO comes a day after U.S. Trade Representative Susan Schwab said American companies were losing billions of dollars annually from piracy levels in China that ''remain unacceptably high.''

GENEVA (AP) - The United States filed two new complaints against China at the World Trade Organization on Tuesday over copyright policy and restrictions on the sale of American movies, music and books, trade officials said.

The move at the WTO comes a day after U.S. Trade Representative Susan Schwab said American companies were losing billions of dollars annually from piracy levels in China that ''remain unacceptably high.''

The Chinese Commerce Ministry on Tuesday expressed ''strong dissatisfaction'' at the U.S. action.

''The two cases have been formally submitted,'' said Magda Siekert, a spokeswoman for the U.S. mission to international organizations in Geneva. The formal requests for consultations were not immediately made available.

The U.S. submissions Tuesday trigger a 60-day consultation period during which trade negotiators from both countries will try to resolve the two disputes. If that fails, the U.S. can ask for the WTO to establish investigative panels. It would likely take years for any retaliatory sanctions to be authorized.

One case contends that Beijing's lax enforcement of copyright and trademark protections violates WTO rules, Schwab told reporters in Washington on Monday. The other argues that Beijing has erected WTO-illegal barriers to the sale of U.S.-produced movies, music and books in China.

''Excessively high legal thresholds for launching criminal prosecutions offer a safe harbor for pirates and counterfeiters,'' the office of the USTR said on its Web site. ''Pirates and counterfeiters who structure their operations to fit below those thresholds face no possibility of criminal sanction.''

China is one of the world's biggest sources of illegally copied goods ranging from movies, music and designer clothes to sporting goods and medications. But the WTO's scope would focus on whether Beijing has taken sufficient action to stamp out intellectual property theft.

''The Chinese government has always been firm in protecting intellectual property rights and attained significant achievements in this respect,'' Commerce Ministry spokesman Wang Xinpei said in a statement.

Wang criticized the U.S. action and said it ''will seriously undermine'' economic and trade relations between the two countries.

The second case _ focusing on China's obligations under the General Agreement on Trade in Services and the terms which it entered the global commerce body in 2001 _ alleges that Beijing has failed to remove import and distribution restrictions on copyrighted U.S. goods including newspapers, magazines, CDs, DVDs and video games.

For some products, distribution is limited to Chinese state-owned companies, the U.S. contends. For others, foreign companies face restrictive requirements that do not extend to Chinese competitors.

The new cases are the latest move against China on the part of the Bush administration, which is trying to deal with rising political anger over America's soaring trade deficit, which set a record for the fifth consecutive year in 2006 at US$765.3 billion. The imbalance with China grew to US$232.5 billion, the highest ever with a single country.

The administration filed a WTO case earlier this year against China's use of government subsidies to support Chinese companies.

It also joined with Canada and the European Union last October in asking the 150-member body to formally investigate China's tariffs on the import of foreign auto parts. A first decision in that case _ which came as a five-year transition period following Beijing's entry into the WTO was ending _ is expected later this year.

Democrats, who won control of both the House and Senate last fall with campaigns that attacked Bush trade policies, said Monday that tougher action was still needed.

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