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Reports: Split decision from WTO on U.S. priacy claims against China (Updated) - October 13, 2008

The official report has not yet been released, but both AP and Reuters moved stories over the weekend citing U.S. trade officials claiming that a World Trade Organization panel has faulted China for not prosecuting DVD and CD pirates. The "interim findings" are the result of a series of complaints filed with the world trade body last year by the Office of the U.S. Trade Representatives. USTR officials were not immediately available to confirm the reports.

The news apparently isn't all good for the U.S., however. According to the reports, the panel found that China's threshold of 500 infringing copies for bringing criminal charges in trademark counterfeiting cases did not violate WTO rules.

According to AP:

The WTO panel faulted China for not prosecuting pirates who copy CDs and DVDs before they are passed by censors, one trade diplomat who had reviewed the interim ruling said Thursday.

But Washington suffered a setback as the panel found that Chinese thresholds for prosecuting piracy do not break WTO rules, the official said.

The U.S. claims the thresholds allow pirates of everything from designer clothes to medicines to tailor their operations to avoid prosecution by staying just below the minimum level of 500 infringing copies.

The report is scheduled to be released next month. Under WTO rules, either party can challenge the interim findings before a final report is issued.

UPDATE: A spokesman for the Motion Picture Assn. of America said the group had been asked by the USTR not to comment on the ruling at this time. Which I suppose means I shouldn't expect a comment from the USTR's office, either.

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