CHINA: China's counterfeiting poses a major problem for European competitiveness, and is now extending to products like foods and birth control pills

Europe's trade chief Peter Mandelson met with officials from China's Intellectual Property Office on Wednesday (November 8) to urge the export giant to provide full access to its patent rights information for other countries and intensify the crackdown on rampant counterfeiting. Mandelson's visit to the mainland is aimed at pushing China to drop to barriers to foreign investment more quickly and take on more responsibilities as a fast-emerging economic powerhouse - including effective Intellectual Property Rights (IPR) protections. Mandelson has said he has no intention of straining relations by suing China at the World Trade Organisation (WTO) for falling behind on its obligations. Speculation is swirling that the United States is on the point of launching a WTO case against China for failing to protect intellectual property. But Mandelson is taking a less confrontative approaching - instead calling on China to stamp out widespread illegal copying of music and other kinds of intellectual property. The problem, he said, is growing. "The problem is no longer confined to fake luxury items, but now includes fake foods and drinks, fake electrical appliances, fake car and aircraft parts, fake medicines, birth control pills - many of which are destined for the developing world," Mandelson told a news conference on Wednesday (November 8). He also came down hard on China for not paying royalties for European music played at the nation's most popular entertainment venues. "Chinese karaoke bars don't pay royalties on European music. This is not acceptable to us. It costs about 40 million euros a year for European music rights holders, and we want this situation remedied as well," said Mandelson. IPR violations were unfair trade practices, he said. "The trade in ideas, like any other trade, should be fair trade. And I urge the Chinese state authorities to strengthen their cooperation with us in combating the unfair trade in ideas," said Mandelson. European officials and companies complain their spread into China is being stymied by investment restrictions and widespread illegal copying of designer bags and clothes, patented technology and other kinds of intellectual property. And the problem is not restricted to European markets. U.S. movie, music and other copyright industry companies claim they lost more than $2.6 billion in China last year because of pirates who control 85 to 90 percent of the market. The European Union and China are due to launch talks in January over a broad new agreement to nurture closer economic and political cooperation. With bilateral trade more than doubling since 2000 and the European Union saddled with a Chinese trade deficit of more than 100 billion euros (128 billion US dollars), Brussels is seeking changes to bilateral trade rules to expand its sales and investment opportunities.

ITN Source | November 8, 2006

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