According to a top US trade official, US is considering action against China at the WTO over subsidies and video, music and other forms of piracy. Deputy US trade representative Karan Bhatia, speaking at a House of Representatives hearing, stated that last year US had almost filed a case against China at the WTO. However, it had agreed to hold the case as China wanted more time for bilateral discussion.
As a result of rampant piracy by Chinese firms, US software, music and book publishers lose billions of dollars every year.
According to the US, the subsidies offered by Chinese government to its industries, including steel, paper and wood industries, are against the WTO agreements and are making their products artificially cheap. For example, China returns half of the taxes collected from Steel companies in China, if they export more than 70% of their produce. Such artificially lowered product prices are damaging industries in other countries.
Japan has also extended support to US over this issue. China is Japan's largest trade partner.
If WTO rules against China, US and other countries can impose retaliatory tariffs on Chinese imports.
