Expert: Regulating Google in accord with WTO norm

14:26, March 12, 2010      

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Overseas media reports recently claimed that some non-governmental organizations (NGO) are accusing the Chinese government of being in breach of its WTO obligations in regulating Google China's services and urged the U.S. government to take China to the WTO to settle the dispute.

"These accusations are groundless, as China's regulations on Google are based on relevant Chinese laws and are in accord with its promises to the WTO," said Zheng Zhihai, secretary general of the Society for WTO-Studies.

National treatment

As a provider of online information retrieval services, Google specializes in "online information and data processing" and "online information and data retrieval" which belong to value-added telecommunication services, according to WTO rules and Chinese laws and regulations. China set clear restrictions on the above services in its promises to the WTO. First, foreign companies are not allowed to provide cross-border services. Instead, they have to establish joint ventures in China and own no more than 50 percent of the total stake. Only qualified joint ventures are entitled to the national treatment.

The full name of Google China is Beijing Guxiang Information Technology Company, and it is a joint venture between Google Ireland and Beijing Feixiangren Information Technology Company. Google Ireland and Beijing Feixiangren Information Technology Company each hold 50 percent of the total shares of Google China. Google China is subject to the above-mentioned restrictions set by the Chinese government, and provides services to Chinese clients via It is entitled to the market access and national treatment in China since its entry into the Chinese market. In the fourth quarter of 2009, its market share in China had jumped to nearly 36 percent from 13 percent in early 2006.

Opening up the market not "zero supervision"

It is not the promises of market access and national treatment that Google is disputing, but the legal right of the Chinese government to supervise the Internet, or more precisely, the right to review web content. According to the rules of the WTO, all of its members are entitled to legal supervision, including the review of web content. In addition, under the General Agreement on Trade in Service (GATS), regulatory measures such as web content review, which apply to all service providers, are approved if they are reasonable, objective, and impartial. It is worth noting that China treats all enterprises, either domestic-funded or foreign-funded, with equality and without any discrimination, and there is no violation of national treatment.

However, some American companies and business associations think that "China should open the market fully and without limits," quite a biased and unconscionable view. All member countries of the WTO, either developed or developing, have always stressed that market access is made up of 2 indivisible aspects: it should be open on the one hand, but under legal management on the other hand. Although the American industries of banking, insurance, and telecommunications are open to the other WTO members, the U.S. has never given up its supervision of financial institutions and telecommunications enterprises. Furthermore, it is more important for developing countries like China to open up the market under legal supervision.

In conclusion, the purpose of China's supervision of the Internet is to build a healthy and harmonious Internet, to protect youth from illegal and harmful content, and to prohibit some people from using the Internet to do things that may endanger China's national security, but not to restrict trade with other countries. Google tries to dispute China's supervision of the Internet by using the rules of the WTO, but it clearly has taken the wrong way, with untenable arguments.

By People's Daily Online
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