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Beijing court rules Yahoo China violates IPR

Fri Dec 21, 4:11 AM ET

SHANGHAI (Reuters) - A Beijing court has upheld a ruling that Yahoo China violates Chinese law by facilitating mass copyright infringement through music downloads, the International Federation of the Phonographic Industry (IFPI) said. ADVERTISEMENT

"The ruling against Yahoo China is extremely significant in clarifying copyright rules for Internet music services in China," said the IFPI, which aims to combat piracy and promote copyright laws.

Officials at Yahoo China could not be immediately reached for comments.

Early this year, music industry leaders including Warner Music Group Corp sued Yahoo China for alleged copyright infringement involving more than 200 unlicensed songs, seeking damages of 5.5 million yuan ($747,100).

Beijing's No. 2 Intermediate Court said in April that Yahoo China, part-owned by Yahoo Inc, one of the world's biggest Internet companies, should bear some responsibility for the copyright infringement, although the music was downloaded from servers of third-party Web sites.

The court ordered Yahoo China to delete links to free Web sites offering music downloads and to pay about 200,000 yuan for facilitating distribution of unlicensed songs by other sites. Yahoo China then said it would appeal against the verdict.

The Beijing Higher People's Court upheld the April ruling on Thursday, under new Chinese copyright laws which entered into force in 2006, the IFPI said in an e-mailed statement dated December 20.

Despite enormous market potential, music sales in China totaled $76 million in 2006, less than 1 per cent of the global recorded music market, the IFPI statement said.

The IFPI, which represents the world's music companies, estimates that about 85 percent of all music consumed in China is pirated.

More than 99 per cent of all music downloading in China infringes copyrights, the statement said.

In November, Chinese Internet search leader Baidu.com was cleared of helping users to download music illegally in a case brought by some of the world's largest music companies.

"China could be a fantastic digital music market if Internet companies like Yahoo China, and their owners, commit themselves to respecting copyright and protecting creators and producers," it said.

Chinese online business-to-business portal Alibaba absorbed Yahoo's China business in 2005 and Yahoo Inc bought a key stake in Alibaba, the parent of Hong Kong-listed Alibaba.com.

(Reporting by Charlie Zhu; Editing by Edmund Klamann)