Geneva (FT) -- The appeals body of the World Trade Organisation has upheld an earlier ruling against China's restrictions on imports of US films and music, rebuffing Beijing's claim that the restrictions were necessary to protect public morals.
Monday's verdict, which is final, also opens the way for US and other foreign companies to sell mobile ring tones and music over the internet in China. This rapidly growing market, already worth half a billion dollars annually, is currently barred to non-Chinese companies.
Ron Kirk, US trade representative, said: "Today America got a big win. We are very pleased that the WTO has found against China's import and distribution restrictions on US movies, music, DVDs and publications."
The ruling comes at a time of escalating trade tensions between the US and China, which is under international pressure to let its currency appreciate.
In September, the administration of Barack Obama imposed punitive tariffs on imports of Chinese tyres and, more recently, duties on Chinese steel pipes. This month China imposed duties on some steel imports from the US and Russia, and has opened an inquiry into US imports of poultry, cars and car parts.
Both countries have chosen to make the WTO their main forum for resolving disputes rather than risk a trade war. China has brought six cases to the WTO since joining the trade watchdog in 2001, five against US measures.
Last week, the US announced China had agreed to withdraw export subsidies on a range of Chinese-branded products, ending a dispute filed with the WTO last December. A panel requested by the US, European Union and Mexico to investigate Chinese curbs on raw material exports was established on Monday.
China will be given time to comply with the latest ruling, but if it fails to do so it could be liable for US trade sanctions equivalent to the estimated value of trade lost.The WTO has not challenged China's right to censor foreign films and publications, nor is Beijing required to lift the quota it imposes of just 20 foreign films a year. But it will now have to allow US and other foreign companies to import films, music and books into China, rather than channel all imports through state-owned entities, and permit US/Chinese joint ventures to distribute music over the internet.http://www.cnn.com/2009/BUSINESS ... uling.ft/index.html |