Piracy is still the big concern for Seattle's software and information-technology companies. The World Trade Organization meeting in Hong...

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Piracy is still the big concern for Seattle’s software and information-technology companies. The World Trade Organization meeting in Hong Kong helps spotlight the problem with China, where more than 90 percent of software is pirated, the Business Software Alliance says.

As a condition to joining the WTO in 2001, China agreed to tougher anti-piracy laws. But enforcement has lagged, and piracy in China remains more pervasive than just about anywhere in the world.

In July, China promised to make government offices — from Beijing to the local level — use only licensed software by the end of the year, with state-owned companies to follow in 2006. But there’s been little change.

“There has been no perceptible reduction in counterfeiting and piracy in China,” Jon Dudas, undersecretary of commerce for intellectual property, said last month. “Chinese goods continue to constitute over 65 percent of all illegal goods seized at U.S. borders.”

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The American Chamber of Commerce in Shanghai said 80 percent of its members still think China’s intellectual-property protections are ineffective.

Efforts to force better compliance are going on in the WTO, but not at the negotiating table. The U.S. reportedly has asked China, through a WTO mechanism, to detail what it is doing to halt piracy, a step that could lead to a trade case against China.

“There is a responsibility for WTO members to prohibit the kind of piracy that we see throughout China,” U.S. Trade Representative Rob Portman said in Beijing last month.


Worldwide last year, for every two dollars’ worth of software purchased legitimately, one dollar’s worth was obtained illegally.

Source: IDC survey

“China may have been meeting the very specific letter of the law, but we’d like to see more in terms of the spirit of the WTO.”

In Seattle, a hub for converging broadband and digital technologies, entrepreneurs stand to gain from better protection, said Lew McMurran, director of government and external affairs at WSA, the state’s software trade association.

But Chinese companies developing their own products also stand to gain.

“You’ve got a lot of people in China who are cranking out intellectual property,” McMurran said. “As innovation starts to take off, their court system has to weigh in. That will start to lead toward a more uniform enforcement.”