The US has indicated that two cases on TRIPS and distribution rights will be brought against China. Here are my two cents on the two cases:
1st case: According to TRIPS Article 61, Members must provide remedies for IPR violation, which shall include imprisonment and/or monetary fines sufficient to provide a deterrent, but this is only supposed to be "consistent with the level of penalties applied for crimes of a corresponding gravity". The question is what are "crimes of a corresponding gravity" with being caught with 500 CDs in hand. This is where the US will have to come up with some really good argument.
2nd case: With regard to the importation of books, newspapers, periodicals, electronic publications and audio and video products, China has not reserved them for state trading. Thus the US should have a case. China can, however, raise a defense for the protection of the public morals under GATT Art. XX, but the big question will be whether the measures China take are "necessary" to achieve such goal. This will drag the WTO into sensitive political issues and I think WTO probably will be very cautious here.
To summarize, if the US win both cases, people in China might no longer be able to buy a pirated copy of the "Red Dragon" off the street corner 10 days after its release, but they will instead be able to go into the cinema to watch "Red Corner" 10 years after it was released.
