Wednesday, August 12, 2009
In a dispute brought in 2007 by the United States against China, a World Trade Organization (WTO) dispute resolution panel issued its report today finding China in violation of its commitments under the Chinese Accession Protocol, the General Agreement on Tariffs and Trade (GATT) 1994 and the General Agreement on Trade in Services (GATS) with respect to the importation and distribution of certain publications and audiovisual materials. The U.S. alleged that various Chinese measures that reserve, to certain Chinese state-designated and wholly or partially state-owned enterprises, the right to import films for theatrical release, audiovisual home entertainment products, sound recordings and publications violated WTO rules because the measures imporperly restricted who is eligible to import such materials into China. The U.S. also alleged that various Chinese measures that impose market access restrictions or discriminatory limitations on foreign service providers seeking to engage in the distribution of publications and certain audiovisual home entertainment products violate WTO rules because they treat foreign parties less favorably than Chinese distributors. Pursuant to Article 3.8 of the Dispute Settlement Understanding (DSU), violation of obligations under one or more WTO Agreements constitutes a prima facie case of nullification or impairment of benefits under the Agreements. In accordance with normal WTO practice, the panel recommended that the Dispute Settlement Body (DSB) request that China bring the relevant measures into conformity with its WTO obligations. The panel's report will now go to the DSB for adoption, unless one or both parties appeal to the WTO Appellate Body. For more information on China-Measures Affecting Trading Rights and Distribution Services for Certain Publications and Audiovisual Entertainment Products, click here.