EU: Companies lose money in China market

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BRUSSELS -- European businesses lose billions of euros in China every year because of lax intellectual property rights protection, according to a European Commission report published Tuesday.

The report said that about 95% of audiovisual materials sold in China are pirated copies, the highest in the entire Asia-Pacific region. It urged the Chinese authorities to clamp down on piracy by: boosting deterrence actions, including the criminal sanctions for pirates; simplifying bureaucracy so that administrative and judicial authorities can co-operate rather than compete on dealing with piracy; scrapping burdensome and discriminatory procedures for foreign right holders; and boosting resources available to those involved in registering and enforcing IPR.

As for the EU, the report said the EC should offer as much policy advice and technical assistance in dealing with piracy as possible. But it added that the EU also should strengthen its message to the Chinese authorities, reminding them of the danger and risks piracy poses. If Beijing fails to act, the report said the EC should consider a lawsuit at the World Trade Organization.

The report said that the rampant piracy of movies and music is partly due to lack of ability to buy the genuine product, which is caused by market access restrictions (for example, a quota system allows only 20 foreign films each year to share in the grosses from Chinese cinemas).

While these restrictions target foreign film and music suppliers and investors, they adversely affect legitimate domestic and foreign players alike, the report said.

The fast-growing rate of Internet access also plays a huge role in the worsening of the problem, the report said, citing the alarming development of such Web sites as the Baidu portal offering illegal downloads.

"Given the global reach of these sites, some of which are operated by publicly listed companies, content owners can no longer feign ignorance," it said. But while legal action is technically possible, China currently lacks the legal facilities to pursue such high-tech crimes.




By Leo Cendrowicz


BRUSSELS -- European businesses lose billions of euros in China every year because of lax intellectual property rights protection, according to a European Commission report published Tuesday.

The report said that about 95% of audiovisual materials sold in China are pirated copies, the highest in the entire Asia-Pacific region. It urged the Chinese authorities to clamp down on piracy by: boosting deterrence actions, including the criminal sanctions for pirates; simplifying bureaucracy so that administrative and judicial authorities can co-operate rather than compete on dealing with piracy; scrapping burdensome and discriminatory procedures for foreign right holders; and boosting resources available to those involved in registering and enforcing IPR.

As for the EU, the report said the EC should offer as much policy advice and technical assistance in dealing with piracy as possible. But it added that the EU also should strengthen its message to the Chinese authorities, reminding them of the danger and risks piracy poses. If Beijing fails to act, the report said the EC should consider a lawsuit at the World Trade Organization.

The report said that the rampant piracy of movies and music is partly due to lack of ability to buy the genuine product, which is caused by market access restrictions (for example, a quota system allows only 20 foreign films each year to share in the grosses from Chinese cinemas).

While these restrictions target foreign film and music suppliers and investors, they adversely affect legitimate domestic and foreign players alike, the report said.

The fast-growing rate of Internet access also plays a huge role in the worsening of the problem, the report said, citing the alarming development of such Web sites as the Baidu portal offering illegal downloads.

"Given the global reach of these sites, some of which are operated by publicly listed companies, content owners can no longer feign ignorance," it said. But while legal action is technically possible, China currently lacks the legal facilities to pursue such high-tech crimes.
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