The Obama administration is weighing complaints from U.S. payments companies that China is violating trade rules by shutting them out of its $723 billion payment-processing market, trade representative Ron Kirk said Friday.

Kirk said the United States has not yet decided whether to file a complaint with the World Trade Organization over the rules, which block companies such as Visa Inc., American Express Co., MasterCard Inc., Discover Financial Services and First Data Corp. from processing credit- and debit-card transactions in China.

Those companies have alleged in recent weeks that China is violating pledges, made when joining the WTO in 2001, to allow full access to that market, according to people familiar with the talks who asked not to be identified because the U.S. is still considering the issue.

"We have been approached by some in our industry," Kirk said. "We've been doing our diligence."

The case highlights the rising tensions between the two countries, adding to disputes on issues from currency policy to import duties to Internet censorship.

In January, U.S. trade associations accused China of developing policies that favor local companies.

"If the government was looking to get tough on China, this is a solid case to take on," David Hartridge, a senior trade policy adviser for the law firm White & Case LLP in Geneva and a former WTO official, said in an interview.

At stake is a market in which payment card purchases surged have more than 26-fold since 2002, according to Terry Xie, an analyst at Mercator Advisory Group in Maynard, Mass. Card spending, excluding automated teller machine transactions, jumped to $722.7 billion in China last year and may reach $1.2 trillion by 2012, Xie said. That would be almost half the payments Visa processed worldwide in 2009.

"China is still very much a cash-based society," said Adam Frisch, an analyst with Morgan Stanley. "You have a market that over the long term could be an immense opportunity."

U.S. lawmakers such as Sen. Charles Schumer, a New York Democrat, have called for moves to counteract China's economic policies. The two countries have disputed the value of China's currency, the U.S. has imposed duties that China has called protectionist and the Obama administration has backed Google Inc.'s decision to stop abiding by China's online censorship rules.

A complaint with the WTO would be the second by the Obama administration against China. A U.S. filing last year said limits on exporting raw materials give Chinese manufacturers an unfair advantage.

"This is a very important issue for each of the companies affected," said John Frisbie, president of the U.S.-China Business Council, a trade group in Washington. "If there are WTO violations and we have winnable cases, then we should bring them."

China does not let foreign banks issue cards denominated in its currency, build networks to support such cards or process point of sale transactions. Foreign banks must "co-brand" with Chinese operators to supply these services and execute payments through China UnionPay Data Co., the country's only payment network.

"The issue is a bilateral, government-to-government trade issue and should therefore be answered by the U.S. Trade Representative," Denise Dunckel, a Visa spokeswoman, said by e-mail.

Some China residents have had access to local credit cards since 1985, when the Bank of China introduced the nation's first card, Xie said. When China joined the WTO in 2001, it promised to grant foreign access to "all payment and money-transmission services, including credit, charge and debit cards," by Dec. 11, 2006.

A spokesman for China's Commerce Ministry, had no comment, and a spokesman for China's embassy in Washington, said he was not aware of any complaint on payment processing. Representatives of MasterCard, First Data, Amex and Discover declined to comment.

While U.S. companies say they are denied entry to China's market, China UnionPay, created by People's Bank of China in 2002, is expanding worldwide.

The company, owned by more than 80 of the nation's largest banks and other state-owned enterprises, has access to payment markets in more than 70 countries and aims to make its cards "acceptable all across the globe," China UnionPay President Xu Luode said in September. "My next step isn't any nation — it's the world," he said.

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