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WTO Cites China for Piracy Lapse

14 Oct, 2008 By: Erik Gruenwedel

The World Trade Organization has faulted China for not prosecuting individuals who produce smaller quantities of pirated movie DVDs, music CDs and other consumer products.

Under Chinese law, pirates can avoid prosecution by replicating below a minimum threshold of 500 units per infringed item.

The Geneva-based WTO’s disputes settlement panel reportedly found the Chinese law did not specifically violate the organization’s rules, among other findings, according to The Associated Press.

The United States, which last April filed antipiracy complaints against China with the WTO, said the threshold enticed pirates to operate smaller production runs in order to circumvent the law.

The complaints alleged that China's burgeoning black market helped put a premium on pirated U.S. DVDs, CDs, software and books aided in part by severe government restrictions on the legitimate sale of Hollywood movies and printed material.

China, which decried the U.S. action with the WTO, did issue a crackdown on street vendors selling pirated packaged media during the Beijing Olympics.

China and the United States are expected to challenge the preliminary ruling, on which the WTO isn’t expected to make a final decision this year.

The Motion Picture Association of America (MPAA) claims U.S. copyright industries lost an estimated $2.3 billion in revenue to piracy in China in 2005. Nine out of every 10 DVDs sold in China is allegedly an illegal copy.

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