Beijing Vows Action To Combat Piracy --- Washington Calls Measures An Incremental Package; A Bid to Avert New Tariffs
By Neil King Jr.
961 words
12 July 2005
The Asian Wall Street Journal
A1
English
(c) 2005 Dow Jones & Company, Inc. To see the edition in which this article appeared, click here http://awsj.com.hk/factiva-ns
BEIJING -- China agreed to take steps to crack down on piracy of U.S. products as part of a package of incremental market reforms meant to ease mounting anti-China sentiment in the U.S. Congress.
Taking a tough tone at the end of a one-day round of trade talks here, U.S. Commerce Secretary Carlos Gutierrez called the measures "only one step," and said the Bush administration would watch closely in coming months to "be sure that commitments translate into results."
Both the Bush administration and the Chinese government are eager to deflect calls in Congress to impose punitive tariffs or other protections against soaring Chinese exports to the U.S. One sign of progress, the U.S. delegation said, would be a decrease in the growing U.S. trade deficit with China, which topped $160 billion last year and has been widening even more briskly this year.
The meetings didn't address such hot-button issues as China's fixed monetary system, which some critics say gives Chinese exports an unfair edge, or the proposed $18.5 billion purchase of U.S. oil company Unocal Corp. by a Chinese rival, Cnooc Ltd., which has raised public anxieties in the U.S. Instead, the focus was squarely on stemming China's frequent violations of international patent and trademark rules, a chief trade irritant that costs U.S. companies billions of dollars in lost sales.
Yesterday's talks, part of the annual U.S.-China Joint Commission on Commerce and Trade, also included U.S. Trade Representative Rob Portman and U.S. Agriculture Secretary Mike Johanns, along with Chinese Vice Premier Wu Yi.
After the meetings, U.S. officials outlined the new steps that China promised to take, several of which remained vague.
The Chinese government agreed to increase the number of criminal prosecutions for intellectual-property violations and to conduct more robust raids against counterfeit goods at trade fairs and against any movie DVDs being sold in China before their official release. Copies of "War of the Worlds," for example, have been selling briskly in Beijing for more than a week even though the movie has just begun playing in theaters. China also promised to implement new rules that would allow officials to arrest and prosecute people who are exporting counterfeit goods. Chinese counterfeits of U.S.-branded products, ranging from car parts to adhesives and golf clubs, have eroded sales of their legitimate U.S.-made versions in many parts of the world.
On the agricultural front, the Chinese agreed to allow in the last remaining strain of U.S. genetically modified corn, a type sold by Monsanto Co. and known as NK603. U.S. officials said the move was significant because lack of approval for this variety, one of eight now allowed in, threatened to hold up future sales of U.S. corn. China so far imports no significant amount of U.S. corn, but that could change as the market grows.
The U.S. negotiators temporarily defused a looming battle over U.S. software sales to China. Under impending regulations, Chinese government agencies would be required to purchase only domestic computer software in a bid to give the nascent industry a boost. The U.S. estimates that the government software market totals more than $8 billion.
The Chinese government, according to a U.S. statement, agreed to delay issuing software rules "as it further considers public comments and makes revisions" in keeping with World Trade Organization rules. The Bush administration, meanwhile, hopes to nudge Beijing into joining the WTO government-procurement agreement, which would open its software market to outside competition.
On other fronts, the Chinese agreed to put forward rules to open their market for the first time to direct door-to-door sales by companies such as Amway Corp. or Mary Kay Inc., the U.S. cosmetics company. China also agreed to publish, by the end of the year, a detailed list of all forms of subsidies it offers to business and agriculture, as is required of other members of the WTO.
China also said it would appoint an "ombudsman" to its embassy in Washington to deal in particular with U.S. complaints over trademark piracy and counterfeiting.
Chinese officials declined to discuss yesterday's talks, but some have said recently that the government has already taken steps to crack down on piracy. Beijing passed new laws last year extending the range of criminal violations, and it has conducted a number of high-profile raids against factories and shops selling fakes.
But U.S. officials said much remains to be done on the piracy front and that actions over the last year, while welcome, have hardly made a dent. "I'd give them a good grade on effort but not on outcome," said Mr. Portman, the top U.S. trade official and, until recently, a member of Congress. "I commend them for trying, but in other places like Hong Kong and Korea there has been much more success."
Mr. Portman said the U.S. would keep a close eye on the number of piracy prosecutions. But he said the best measure of success "will be an increase of sales of U.S. trademarked and patented products."
Lu Jinyong, a professor of international trade at the University of International Business and Economics in Beijing, said China is evolving quickly on the piracy issue. "China also has realized the importance of protecting intellectual property rights," he said. "Rampant piracy not only hurts foreign brands, but also handicaps China's own innovation capability."
---
Qiu Haixu contributed to this article.
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By Neil King Jr.
961 words
12 July 2005
The Asian Wall Street Journal
A1
English
(c) 2005 Dow Jones & Company, Inc. To see the edition in which this article appeared, click here http://awsj.com.hk/factiva-ns
BEIJING -- China agreed to take steps to crack down on piracy of U.S. products as part of a package of incremental market reforms meant to ease mounting anti-China sentiment in the U.S. Congress.
Taking a tough tone at the end of a one-day round of trade talks here, U.S. Commerce Secretary Carlos Gutierrez called the measures "only one step," and said the Bush administration would watch closely in coming months to "be sure that commitments translate into results."
Both the Bush administration and the Chinese government are eager to deflect calls in Congress to impose punitive tariffs or other protections against soaring Chinese exports to the U.S. One sign of progress, the U.S. delegation said, would be a decrease in the growing U.S. trade deficit with China, which topped $160 billion last year and has been widening even more briskly this year.
The meetings didn't address such hot-button issues as China's fixed monetary system, which some critics say gives Chinese exports an unfair edge, or the proposed $18.5 billion purchase of U.S. oil company Unocal Corp. by a Chinese rival, Cnooc Ltd., which has raised public anxieties in the U.S. Instead, the focus was squarely on stemming China's frequent violations of international patent and trademark rules, a chief trade irritant that costs U.S. companies billions of dollars in lost sales.
Yesterday's talks, part of the annual U.S.-China Joint Commission on Commerce and Trade, also included U.S. Trade Representative Rob Portman and U.S. Agriculture Secretary Mike Johanns, along with Chinese Vice Premier Wu Yi.
After the meetings, U.S. officials outlined the new steps that China promised to take, several of which remained vague.
The Chinese government agreed to increase the number of criminal prosecutions for intellectual-property violations and to conduct more robust raids against counterfeit goods at trade fairs and against any movie DVDs being sold in China before their official release. Copies of "War of the Worlds," for example, have been selling briskly in Beijing for more than a week even though the movie has just begun playing in theaters. China also promised to implement new rules that would allow officials to arrest and prosecute people who are exporting counterfeit goods. Chinese counterfeits of U.S.-branded products, ranging from car parts to adhesives and golf clubs, have eroded sales of their legitimate U.S.-made versions in many parts of the world.
On the agricultural front, the Chinese agreed to allow in the last remaining strain of U.S. genetically modified corn, a type sold by Monsanto Co. and known as NK603. U.S. officials said the move was significant because lack of approval for this variety, one of eight now allowed in, threatened to hold up future sales of U.S. corn. China so far imports no significant amount of U.S. corn, but that could change as the market grows.
The U.S. negotiators temporarily defused a looming battle over U.S. software sales to China. Under impending regulations, Chinese government agencies would be required to purchase only domestic computer software in a bid to give the nascent industry a boost. The U.S. estimates that the government software market totals more than $8 billion.
The Chinese government, according to a U.S. statement, agreed to delay issuing software rules "as it further considers public comments and makes revisions" in keeping with World Trade Organization rules. The Bush administration, meanwhile, hopes to nudge Beijing into joining the WTO government-procurement agreement, which would open its software market to outside competition.
On other fronts, the Chinese agreed to put forward rules to open their market for the first time to direct door-to-door sales by companies such as Amway Corp. or Mary Kay Inc., the U.S. cosmetics company. China also agreed to publish, by the end of the year, a detailed list of all forms of subsidies it offers to business and agriculture, as is required of other members of the WTO.
China also said it would appoint an "ombudsman" to its embassy in Washington to deal in particular with U.S. complaints over trademark piracy and counterfeiting.
Chinese officials declined to discuss yesterday's talks, but some have said recently that the government has already taken steps to crack down on piracy. Beijing passed new laws last year extending the range of criminal violations, and it has conducted a number of high-profile raids against factories and shops selling fakes.
But U.S. officials said much remains to be done on the piracy front and that actions over the last year, while welcome, have hardly made a dent. "I'd give them a good grade on effort but not on outcome," said Mr. Portman, the top U.S. trade official and, until recently, a member of Congress. "I commend them for trying, but in other places like Hong Kong and Korea there has been much more success."
Mr. Portman said the U.S. would keep a close eye on the number of piracy prosecutions. But he said the best measure of success "will be an increase of sales of U.S. trademarked and patented products."
Lu Jinyong, a professor of international trade at the University of International Business and Economics in Beijing, said China is evolving quickly on the piracy issue. "China also has realized the importance of protecting intellectual property rights," he said. "Rampant piracy not only hurts foreign brands, but also handicaps China's own innovation capability."
---
Qiu Haixu contributed to this article.
Document AWSJ000020050711e17c0000g
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