'Enforce piracy penalties or face consequences.'

The office of the U.S. Trade Representative (USTR) has sent China a letter warning that the country needs to enforce its criminal penalties for piracy or face penalties as a WTO member.

USTR announced Oct. 26 it had forwarded the letter "in accordance with a provision of the TRIPS (trade related intellectual property) agreement that requires one WTO member to respond to a request from another member for information about compliance with this agreement." USTR said it was "seeking information thus far unavailable" to WTO members and private rights holders, such as the Recording Industry Assn. of America (RIAA) about why the rampant piracy in that country continues.

While diplomatic in wording, the message, say insiders, is clear -- explain why you haven't cleaned up your act, or face future trade consequences.

Mitch Bainwol, chairman/CEO of RIAA, who recently traveled to Beijing, said the Chinese leaders he met admitted the problem is "intolerable," and said in the light of China's WTO obligations, the letter is meant to express the Bush administration's growing impatience with its intellectual property piracy problem.