The movie industry got a big boost Monday from the World Trade Organization on film distribution in China.
Siding with the U.S., a WTO appeals board reconfirmed that Chinese restrictions on the way foreign movies and other content can be distributed inside the country violate trade rules.
As set up, the Chinese curbs have three effects. First they require studios to use one of two state-owned distributors. Second, distributors (not the studios) get to pick the movies to distribute. Third, because the studios have to work with only two distributors, they have little ability to play one off the other in pricing distribution.
American and industry officials called the decision a major victory, but said once the board’s decision is formally adopted by China, it’s up to China what changes will take place.
The Chinese Embassy in Washington did not answer a call seeking comment