The IFPI describes as "inexplicable" a Chinese court's ruling in favor of Bejing-based Web portal Baidu in a copyright-violation lawsuit filed by the international labels group against the portal.

The IFPI describes as "inexplicable" a Chinese court's ruling in favor of Bejing-based Web portal Baidu in a copyright-violation lawsuit filed by the international labels group against the portal.

According to reports, the First Intermediate Court in Beijing ruled that the service did not constitute an infringement as its music files were downloaded from third-party Web servers.

In a statement released in London Nov. 17, IFPI chairman/CEO John Kennedy said he was "amazed" by the judgment, details of which were not available at press time.

"(It) is totally out of step with Chinese law and with court decisions made against similar services around the world," Kennedy said. "IFPI will be appealing this ruling, and we are confident it will be overturned. Baidu senior manager of investor relations Lesley Zhang, meanwhile, says Baidu is pleased with the court's decision.

"We believe that this decision will encourage expanded cooperation between music and Internet companies, thereby benefiting the development of both industries and helping to bring an ever increasing range of licensed entertainment content to China's Internet users," Zhang says.

The case against Baidu was filed on behalf of Gold Label (EMI), Go East (Universal), Cinepoly (Universal), EMI, Warner, Universal and Sony BMG and concerned a total of 195 sound recordings.

The claims in the cases, which were consolidated at two hearings at the Beijing No. 1 Intermediate Court in September 2005, concerned Baidu's alleged infringement of the labels' public transmission right by providing "deep links" to Web sites offering unauthorized downloads.

"China has the potential to be a huge market for the domestic and international music industry, but if it is going to realize that potential then it is essential that the courts respond effectively in the face of the blatant infringement of record companies' intellectual property rights," Kennedy said.