WTO: China discriminates against foreign card companies

People withdraw money from ATMs in Chongqing Washington is calling the ruling a win, even though the WTO did not agree with the US on all claims

Related Stories

The World Trade Organization (WTO) has ruled that China discriminates against foreign credit-card and debit-card providers.

A panel of the trade body said China maintains a monopoly on yuan-denominated payment cards which breaks WTO rules.

Only one company, China UnionPay, is allowed to process domestic currency transactions.

This limits foreign providers such as Visa and Mastercard.

There is a 60-day period in which either side can appeal against the ruling.

Greater participation

The Obama administration first lodged the complaint in 2010.

US companies have been trying to get greater access to the massive China market.

Start Quote

Today's win highlights that tackling unfair Chinese trade practices has been a priority of this president”

End Quote Jay Carney White House press secretary

Currently, they can only issue cards in partnership with Chinese banks and China UnionPay.

Visa said in a statement that the company is "hopeful that this ruling will pave the way for international payment companies to participate in the domestic payments marketplace in China".

Political battle

The decision by the WTO is being hailed as a "win" by the US government. The trade gap with China has become a campaign issue in the upcoming elections.

"Today's win highlights that tackling unfair Chinese trade practices has been a priority of this president," said Jay Carney, White House press secretary.

Tim Reif from the US Trade Representative's office said the ruling would support about 6,000 jobs if it goes through.

However, the WTO did not agree with all the claims raised by the United States.

The panel ruled that China UnionPay had a monopoly on yuan payment cards issued and used in China, but stopped short of saying it was an "across-the-board monopoly supplier" for all transactions made in local currency.

Mr Reif, however, said China would still have to fix the discrimination in the system.

More on This Story

Related Stories

The BBC is not responsible for the content of external Internet sites

More Business stories

RSS

Features

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.