Baidu.com, China's largest search engine, yesterday filed the paperwork to list on the Nasdaq in the United States, in another step towards its planned US$80 million initial public offering slated for next month.
Analysts expect a positive reaction to the listing, despite legal risks arising from the firm's MP3 search function, which accounts for 22 per cent of its internet traffic.
A recent US Supreme Court ruling said that companies can be held responsible for the illegal file-sharing activities of their customers. The company is already a defendant in two copyright infringement cases in China connected with its MP3 and movie search services.
Baidu uses search algorithms to link to MP3 files hosted on third-party servers, which play in a Baidu-branded pop-up window.
Its prospectus therefore speaks of 'increased risks of being subject to copyright infringement claims relating to our MP3 search service.
'We may be required to change our business model and service offerings ... which would adversely affect our business prospects.'