A group of leading international record companies have lost their lawsuit against Baidu.com, one of China's largest Internet search engines, for the alleged illegal downloading and sharing of their music.

The seven companies, including EMI, SONY BMG, Warner Music and Universal Music, in 2005, accused Baidu.com of engaging in illegal downloading and playing 137 pieces of music owned by the record companies online without their permission.

They demanded a public apology from Baidu, the suspension of its download service and compensation of 1.67 million yuan (US$226,000).

But the People's High Court of Beijing said in its final rule Sunday that Baidu's service does not constitute an infringement.

Last November, Beijing's First Intermediate Court also ruled that Baidu's service, which provides web links to the music, does not constitute an infringement as all the music is downloaded from web servers of third parties.

The record companies voiced their dissatisfaction at the ruling and appealed to the higher court.

Baidu argued that the MP3 search engine it provided was the same as other search engines providing links to web pages, news and pictures.

Some web servers have put a huge amount of copyrighted music onto the Internet and offered them to millions of netizens without permission from copyright owners.

Baidu said it searched all music file formats through the Internet, such as ".mp3" or ".wav", making no distinction between copyrighted and pirated songs.

(Xinhua News Agency December 31, 2007)