MOC welcomes WTO ruling on payment card dispute

BEIJING -- A spokesman for the Ministry of Commerce on Monday welcomed a ruling by a World Trade Organization dispute panel set up following accusations by the United States against China's handling of cross-border electronic payments.

In a report published by the WTO on Monday, the dispute panel dismissed US accusations concerning China UnionPay's market status at home, ruling that measures by China have not barred foreign service providers from entering the Chinese market, Shen Danyang said.

The ruling also rejected the US view that foreign service providers can provide cross-border supply of electronic payment services into China. The panel judged that foreign service providers must meet the requirements under China's Schedule of Specific Commitments on Services, Shen said.

"However, China takes reservations in the panel's ruling that the electronic payment service belongs to the 'all payment and money transmission services' that China pledged to open up when joining the WTO," Shen added.

The spokesman said that China will seriously review the panel's report, and will properly deal with the ensuing work related to the case in accordance with the WTO's dispute settlement procedures.

On Sept 15, 2010, the United States filed a consultation request with the WTO's dispute settlement body, saying that Chinese measures related to electronic payment services violated its commitment to the General Agreement on Trade in Services.

The United States alleged that China permits only China UnionPay to supply electronic payment services for payment card transactions denominated and paid in yuan in China.

Either side can appeal within 60 days after the initial ruling. If they do so, the WTO's Appellate Body will issue a final ruling within 90 days. If neither side appeals, the ruling by the dispute settlement panel will be final.

China UnionPay is a bankcard association established in March 2002. At present, the Shanghai-headquartered UnionPay has about 400 domestic and overseas associate members.