WTO Panel to Investigate Chinese IP Protection and Enforcement
The US said it recognised China had made the protection of IPR a priority and had taken active steps to improve IPR protection and enforcement. The US added that bilateral discussions on matters related to the panel request had not resulted in a mutually agreed solution which was the reason for the panel request.
China declared it was regrettable that the US asked for a panel a second time and added that it remained confident China's measures were consistent with WTO rules. China stated that the US attempted to impose on developing countries extra obligations going beyond the TRIPS Agreement. China concluded it would defend its interests throughout the process.
The countries that reserved their third party rights are Japan, Mexico, the EC, Chinese Taipei and Argentina.
The four matters on which the United States requested consultations are:
- the thresholds that must be met in order for certain acts of trademark counterfeiting and copyright piracy to be subject to criminal procedures and penalties;
- goods that infrige intellectual property rights that are confiscated by Chinese customs authorities, in particular the disposal of such goods following removal of their infringng features;
- the scope of coverage of criminal procedures and penalities for unauthorized reproduction or unauthorized distribution of copyrighted works; and
- the denial of copyright and related rights protection and enforcement to creative works of authorship, sound recordings and performances that have not been authorized for publication or distribution within China.
The United States claims that in relation to the four above-mentioned matters possible inconsistencies with the TRIPS Agreement arise as follows:
- The lack of criminal procedures and penalties for commercial scale counterfeiting and piracy in China as a result of the thresholds appears to be inconsistent with China's obligations under Articles 41.1 and 61 of the TRIPS Agreement.
- The requirement that infringing goods be released into the channels of commerce under the circumstances set forth in the measures at issue appears to be inconsistent with China's obligations under Articles 46 and 59 of the TRIPS Agreement.
- Authors of works whose publication or distribution has not been authorized (and whose publication or distribution is therefore prohibited) appear not to enjoy the minimum standards of protection specially granted by the Berne Convention in respect of those works (and may never enjoy such protection if the work is not authorized, or is not authorized for distribution or publication in the form as submitted for review).
- The rights of authors of works whose publication or distribution is required to undergo pre-publication or pre-distribution review appear to be subject to the formality of successful conclusion of such review.
- To the extent that the Copyright Law also denies protection of so-called related rights to performers and producers of sound recordings during the period of any pre-publication or pre-distribution, the Copyright Law appears to be inconsistent with China's obligtaions under Article 14 of the TRIPS Agreement.
- To the extent that different pre-distribution and pre-authorization review processes for Chinese nationals' works, performances (or their fixations) and sound recordings than for foreign nationals' works, performances (or their fixations) and sound recordings result in earlier or otherwise more favourable protection or enforcement of copyright or related rights for Chinese authors' works, Chinese performers' performances (or their fixations) and Chinese producers' sound recordings, the measures at issue appear to be inconsistent with China's obligations under Article 3.1 of the TRIPS Agreement.
- To the extent that Article 4 of the Copyright Law causes foreign authors of works whose publication or distribution has not been authorized not to enjoy the rights granted to Chinese authors, the measures at issue appear to be inconsistent with China's obligations under Article 9.1 of the TRIPS Agreement (with respect at least to China's obligations to comply with Articles 5(1) and 5(2) of the Berne Convention).
- To the extent that Article 4 of China's Copyright Law makes it impossible for rightsholders to enforce their copyrights or related rights with respect to works, performances or sound recordings that have not been authorized for publication or distribution, China appears to act inconsistently with China's obligations under Article 41.1 of the TRIPS Agreement.
- To the extent that wilful copyright piracy on a commercial scale that consists of unauthorized reproduction — but not unauthorized distribution — of copyrighted works, and vice versa, may not be subject to criminal procedures and penalties under the law of China, this would appear to be inconsistent with China's obligations under Articles 41.1 and 61 of the TRIPS Agreement.
On 20 April 2007, Japan requested to join the consultations. On 25 April 2007, Canada and the European Communities requested to join the consultations. On 26 April 2007, Mexico requested to join the consultations. Subsequently, China informed the DSB that it had accepted the requests of Canada, the European Communities, Japan and Mexico to join the consultations.
For more information on the WTO's sipute resolution process, see
- The basics: how disputes are settled in WTO
- Computer based training on dispute settlement
- Text of the Dispute Settlement Understanding