US says China has fallen short on ‘phase one’ intellectual property commitments
- Office of the US Trade Representative says legal revisions Beijing has made do not produce ‘the full range of fundamental changes needed’
- Agency holds off designating China a ‘priority foreign country’, which would trigger an inquiry that could lead to retaliatory tariffs
The US criticised China on Friday for failing to fulfil commitments it made in the “phase one” trade deal a year ago to improve protections for the intellectual property of American companies.
In its first report under the Biden administration, the office of the US Trade Representative (USTR) acknowledged the revisions China has made in its patent, copyright and criminal laws, as well as the publication of several draft measures concerning IP.
“However, these steps toward reform require effective implementation and fall short of the full range of fundamental changes needed to improve the IP landscape in China,” the report found.
The USTR report identifies countries it says are the most egregious intellectual property violators. In rare cases the agency could designate a nation as a “priority foreign country”, which would trigger an investigation that could lead to retaliatory tariffs or the filing of a dispute with the World Trade Organization.
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China was not labelled a priority foreign country, but remained on the “priority watch list” this year, to be monitored closely for IP-related infringements. No immediate penalty is attached to the priority watch list designation.