China faces trade cases

WASHINGTON --

The Bush administration announced new trade cases against China yesterday over copyright piracy and restrictions on the sale of American movies, music and books.
Standing near a table of pirated movie DVDs, music CDs and books, U.S.

Trade Representative Susan Schwab said American companies were losing billions of dollars annually from piracy levels in China that "remain unacceptably high."
She said the United States would file the two cases today with the World Trade Organization, the Geneva-based organization that oversees trade disputes.
One case will contend that Beijing's lax enforcement of copyright and trademark protections violates WTO rules, and the other will argue that Beijing has erected WTO-illegal barriers to the sale of U.

S.-produced movies, music and books in China.
The action marked the latest move against China on the part of the Bush administration, which is trying to deal with rising political anger over soaring U.

S. trade deficits.
The trade cases exposed a split in the business community: The film, music and book publishing industries supported the move while some other industries were concerned over whether the aggressive approach to China could result in retribution.

In her news conference, Schwab acknowledged that different industries favor different approaches. She noted that the software industry scored a big victory last year when China agreed to sell all computers with operating software. "Where we are making progress, there is no need to litigate," she said.

The U.S. trade deficit set a record for the fifth consecutive year in 2006 at $765.

3 billion. The imbalance with China grew to $232.5 billion, the highest ever with a single country.

Earlier this year, the administration filed a WTO case against China's use of government subsidies to support Chinese companies. The administration on March 30 announced it was imposing penalty tariffs on Chinese glossy paper imports in a case that broke a 23-year precedent, barring U.S.

companies from seeking protection in cases involving nonmarket economies such as China.
Democrats, who won control of both the House and Senate last fall with campaigns that attacked Bush trade policies, said yesterday that tougher action was still needed.
"Late is better than never," said Sen.

Charles Schumer, D-N.Y. "I hope this is just the beginning of a much-stronger administration stance on China's nonstop violations of free-trade rules.

" Schumer and a group of other senators are drafting legislation to penalize China for manipulating its currency to gain trade advantages.
Sen. Sherrod Brown, D-Ohio, called the timing of the new cases "certainly suspicious" given that they come when the administration is asking Congress to renew Bush's fast-track authority, which allows him to negotiate trade deals for expedited consideration by Congress.