China promised on Dec. 21 to get tougher on copyright and patent violations, a long-awaited move that may ease U.S. concerns over rampant piracy believed to cost foreign businesses billions of dollars

BEIJING (Reuters) -- China promised on Dec. 21 to get tougher on copyright and patent violations, a long-awaited move that may ease U.S. concerns over rampant piracy believed to cost foreign businesses billions of dollars every year.

In a new interpretation of the law governing intellectual property rights, the country's top court lowered the bar for treating violations as crimes and laid out prison terms of up to seven years for the worst offenders.

The interpretation, debated behind closed doors for much of 2004, aims to address long-standing complaints by the United States and others that China has done little to stamp out piracy of everything from software to golf clubs.

"We should not only sentence such offenders in a determined manner, but also make it economically impossible for the criminals convicted and sentenced to commit the crime again," Cao Jianming, VP of the Supreme People's Court, told reporters.

Cao said the court had firmed up legal definitions of terms such as "without permission of the copyright owner" and "reproducing and distributing" to make it easier to prosecute offenders.

The legal ruling comes amid heightened awareness within China of the pitfalls of counterfeit products, following a fake milk powder scandal that killed 13 babies and made nearly 200 others sick.

A spokesman said the U.S. embassy had taken note of the news and would examine the text carefully with government departments that follow IP issues.

U.S. officials and businesses have complained that so far it has been too difficult to prosecute violators, and successful cases have almost always resulted in modest fines that do little to resolve the problem.

They have also complained that while the central government appears serious about tackling piracy, local officials and police have often been reluctant to act.

Violations are widespread, with DVDs of the latest Hollywood blockbusters selling on the streets for less than $1.

Chinese copyright violations alone cost U.S. companies up to $3.8 billion a year, according to a report issued recently by the office of U.S. Trade Representative Robert Zoellick.

The piracy isn't confined to media, however. Industrial firms such as U.S. car giant General Motors have complained that Chinese companies have copied their designs, and knock-offs of the latest Louis Vuitton and Nike styles can be bought for a fraction of the price of the legitimate product.

Washington has made piracy one of its top trade issues with China, and has pressed Beijing to punish violators with jail terms and even to stage "perp walks," a publicity tactic that parades perpetrators of crimes in front of news cameras.

"Protecting IP rights is necessary not only for China's honoring of its international promises, creating a favorable trade and investment environment and ... improving the quality of the economy," Cao said.