Traders of the Caribbean

[Dredinvestments]

China might appeal WTO ruling on film import

China says it might appeal WTO ruling on movie, music imports, insists trade `unimpeded'

By Joe Mcdonald, AP Business Writer
On Wednesday August 12, 2009, 11:58 pm EDT

BEIJING (AP) -- China said Thursday it might appeal a World Trade Organization ruling that it improperly restricts distribution of foreign movies, music and books and insisted it does not impede imports.

A WTO panel ruled Wednesday in a case brought by the United States that China violates free-trade rules by forcing importers of foreign media products to route them through Chinese state-owned companies.

"The Chinese side feels regret at the ruling by the experts group," Commerce Ministry spokesman Yao Jian said in a written statement. "The Chinese side will conscientiously assess the expert group's ruling and does not rule out the possibility of an appeal."

Yao's statement said "the channels for China's import market for published materials, movies and music are completely unimpeded."

The case is sensitive for Beijing because the communist government insists on controlling the content of movies, music, books and other media. It comes at a time when the government is trying to build up China's state-owned film studios and other media to promote the ruling party's views at home and abroad.

The conflict is one of a series between the United States and China, respectively the world's largest and third-largest economies, over access to each other's markets for goods ranging from tires to poultry.

Foreign movies, music and other cultural products are popular in China's fast-growing media market. Foreign film and music suppliers complain that import controls have helped to fule the expansion of China's thriving black market in pirated copies by limiting customers' access to legitimate products.

China defended its media controls as needed to ensure removal of offensive content and protect public morals.

The WTO ruling said Beijing should allow foreign companies to distribute master copies of books, magazines and newspapers to customers in China; wholesale electronic publications and receive the same conditions and charges as Chinese companies for distributing reading materials.

The ruling said Beijing was allowed to continue requiring imported films to go through one of two government-designated distributors -- a condition that does not apply to Chinese titles.

The WTO panel also rejected a U.S. argument that Chinese censorship of music hampered sales.

Beijing agreed when it joined the WTO in 2001 to treat foreign and domestic companies equally. But foreign companies in a range of industries complain that they face barriers to imports and investment.