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China, EU to negotiate trade terms next year

China and the EU will meet early next year to address „gaps” in China's follow-through on some international trade commitments, European Union Trade Commissioner Peter Mandelson said.

Europe will ask China to fulfill more of its obligations as a World Trade Organization member by allowing more access to service markets and doing more to address piracy of intellectual property, Mandelson said. „We are satisfied China is implementing the bulk of its WTO accession commitments, but there are gaps, for example, on access to certain service markets” and protection of intellectual property, Mandelson said in a telephone interview from Beijing today.

EU officials hope the talks will make progress on issues including protection of copyrights and trademarks belonging to European brands in China. Both the EU and the US have threatened to challenge China through the WTO over lax enforcement. Such violations account for as much as €360 billion ($460 billion) in unlawful trade a year, the EU has said. Mandelson and Chinese Vice Premier Wu Yi agreed to hold talks in January during a meeting on Friday, Mandelson said.

Discussions will aim to update trade and investment agreements made in 1985, and the EU will not ask for „extensive new tariff reductions,” Mandelson said. In some areas of trade and investment, „conditions are improving, but suffer from extensive government restrictions in China,” Mandelson said. „The terms of reference for the negotiations which Wu Yi agreed should be put in place over the next month will reinforce present reciprocal agreements.”

Mandelson met with Commerce Minister Bo Xilai earlier this week and accused China of backtracking on WTO commitments to protect intellectual property rights and of turning a blind eye to violations. China joined the WTO five years ago. Chinese companies including state broadcaster CCTV have failed to pay royalties to European music rights holders, Mandelson said November 8. (Bloomberg)