China’s failure to crack down on pirating of American movies, music and software is costing U.S. businesses billions of dollars and putting jobs at risk, lawmakers and government officials said Wednesday.
“The problems in China run deep,” Chris Israel, the U.S. coordinator for international intellectual property enforcement, said in remarks prepared for delivery before a congressional advisory panel.
“The rising tide of counterfeiting and piracy in China has created enormous challenges for U.S. businesses,” he said, noting that industries dealing with intellectual property employ 18 million Americans.
Beijing says it has some 300,000 people devoted to stopping product piracy. It announced in April the opening of a 50-city network of intellectual property enforcement offices.
But Democratic Rep. Diane Watson told the U.S.-China Economic and Security Review Commission that China was widely thought of as “the model country for intellectual property piracy, and for good reason.”
She called the scope of software piracy in China staggering, citing estimates that for every $2 of software bought legitimately, a dollar’s worth was obtained illegally.
Democratic Sen. Carl Levin, who represents the state of Michigan, which has a large auto industry, said estimates found that the U.S. auto parts industry loses about $12 billion a year to counterfeiters, with China said to be responsible for about 75 percent of those fake auto parts.
Despite Beijing’s expanded efforts to fight the problem, Israel said, “so far, China has not lived up to its responsibility to effectively enforce intellectual property rights.”
The United States, he said, is “left with no choice” but to consider filing a complaint against China to the World Trade Organization for inadequate enforcement of copyright protections.
The United States is using “every trade tool at our disposal” to stop the problem, Israel said. “We consider all options to be on the table.”
The commission meeting comes as many in Congress are voicing misgivings about China’s new international presence, which they say clashes with U.S. interests. Critics allege that China mistreats its citizens, that an undervalued currency hampers U.S. competition, and that China’s growing military strength could lead to conflict involving Taiwan.
Israel praised China for some positive moves on copyright protection, including a court ruling in December in favor of luxury trademark brands that had been fighting to prevent the sales of fake versions of their products.
But he said Chinese efforts to enforce copyright protection are hurt by insufficient political will, corruption and misallocated resources and training.
“Few issues are as important to the current and future economic strength of the United States as our ability to create and protect intellectual property,” he said.