China Programme • Volume 12 • Number 39 • 19th November 2008
China to Ease Restrictions on Foreign News Providers
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China agreed last week to loosen state controls on news services and providers of financial information, putting an end to a trade dispute with Canada, the EU and the US. A new regulatory framework will be put in place by 1 June next year, according to memorandums of understanding that China struck with each of the complainant countries.
”I am very pleased we have been able to sign an agreement with China today to allow financial information suppliers like Bloomberg, Dow Jones and Thomson Reuters to operate in China free of unfair restrictions that threatened to place them at a competitive disadvantage,” US Trade Representative Susan Schwab said in a statement.
EU Trade Commissioner Catherine Ashton echoed Schwab’s sentiments: “Today’s agreement ensures that investors and market operators will be able to receive comprehensive and objective financial information. This shows what can be achieved when interested parties cooperate in search of solutions.”
The agreements settle a WTO dispute in which Brussels, Ottawa and Washington faulted Beijing for adopting discriminatory restrictions against foreign providers of financial data.
In 2006, Beijing renewed the monopoly held by the state news agency Xinhua, effectively preventing foreign providers of financial information services from dealing directly with Chinese clients. All foreign financial information suppliers were required to operate through a government agency controlled by Xinhua News Agency, a direct competitor of the foreign suppliers of financial information.
The EU and the US initiated dispute settlement procedures at the international trade body in March 2008; joint consultations were held in April. A few months later, Canada also filed a complaint against Beijing.
Under the agreements announced last week, China will employ a fair and transparent approach to licensing. Responsibility for regulating financial information services will be passed from Xinhua News Agency to an independent regulator, as required under the terms of China’s entry into the WTO. Beijing has promised that the new regulator will only request information from financial information suppliers that is relevant and that adequate protection will be provided when dealing with confidential business information.
Additionally, the requirement that foreign suppliers do business through an agent will be eliminated. Beijing further confirmed that foreign suppliers of financial information will face no obstacles when setting up commercial establishments in China.
”This outcome is particularly significant in these volatile financial times,” USTR Schwab added. “It shows that the WTO and the rules of the multilateral trading system are successfully resolving major international trade problems,” she said.
ICTSD reporting; “China settles WTO info row with US, EU, Canada,” REUTERS, 13 November 2008; “China settles financial info dispute with EU, US, Canada,” AGENCE FRANCE PRESSE, 13 November 2008.
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