China censured over pirated software

 

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By Stuart Turton and Reuters

Posted on 27 Jan 2009 at 10:48

The World Trade Organisation has ruled that China must stop turning a blind eye to the widespread sale of pirated software.

The ground-breaking ruling requires that China destroy counterfeit software after it has been confiscated by authorities, and offer greater legal protection to foreign copyright.

The ruling is intended to break the current cycle of distribution, which often sees confiscated software back on the streets within days of its initial seizure.

The US launched the dispute in 2007 out of frustration at rip-offs of software, films and other trademarked property openly available in Chinese cities.

The International Intellectual Property Alliance, a coalition of US music, movie, book and software industry groups, estimates that piracy in China costs them more than $3.7 billion in lost sales.

"Today, a WTO panel found that a number of deficiencies in China's Intellectual Property Rights regime are incompatible with its WTO obligations," says acting US Trade Representative Peter Allgeier. "We will engage vigorously with China on appropriate corrective actions to ensure that US rights holders obtain the benefits of this decision."

The US failed to persuade the WTO panel on one main point of its case: that Chinese copyright pirates and counterfeiters have no fear of criminal prosecution because the government's threshold for bringing a case is too high.