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August 14, 2009

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China may fight WTO decision on publications

CHINA may appeal a ruling by the World Trade Organization supporting a US complaint against the country's regulations on imported books, films and music, the Ministry of Commerce said yesterday.

"China regrets that the WTO did not reject the US complaint. We will conduct a serious evaluation of the ruling, and we can't rule out the possibility of an appeal," ministry spokesman Yao Jian said.

He said China has carried out its obligations governing the entry of foreign publications, and the channels for these products are operating smoothly.

The United States brought a complaint to the global trade watchdog in April 2007 saying China was not providing enough access for imports of publications and other creative content. The case involves publications such as books and newspapers, audio and video products including CDs, DVDs and games, and music downloading services.

"China has always fulfilled its obligations for market access, and the channels for foreign publications, films, and audio-visual products entering the Chinese market are extremely open," Yao said.

In a report on Wednesday, the WTO said China cannot use "censorship concerns" to justify trade barriers on books, films and audio-video products, as the practice violates the rules of the trade organization. It called on China to allow US companies to partner with Chinese enterprises to distribute their products, instead of permitting them to sell only through assigned channels, usually state-owned distribution networks.

The WTO panel did not support Washington in all its claims and declined to rule on others it agreed with China were outside its mandate, Reuters reported. The ruling, for instance, did not reject China's import quota of 20 foreign films each year.

Both sides now have 60 days to lodge an appeal. If so, it would be heard by a higher body within the WTO, which could uphold or reverse all or part of the ruling.

Sun Lijian, an economics professor at Shanghai's Fudan University, said the WTO decision neglected the fact that books and films are different from ordinary imports because of their ideological content.

"Products such as books and films are related to the security of our culture," Sun said. "China is very careful about the introduction of such products. In the government's view, the limit has nothing to do with monopoly practices or trade barriers."

Combined with unrelated US complaints that China's tire exports are harming American manufacturers and jobs, Sun said it is urgent for China to use WTO rules to defend Chinese interests.


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