Evidence of the U.S. 301 investigation in China is obviously insufficient. In fact, China’s protection of intellectual property continues to increase. China has abundant intellectual resources and a complex market structure. With the recent years, multinational companies have accelerated the pace of setting up R&D institutions in China. China has become an important link in the global technology invention creation value chain.
Insufficient evidence from U.S. China 301 investigation
U.S. 301 investigations in China lacked direct evidence. First, in terms of quantity, only less than 20% of the testimonies provided by the U.S.-China Trade Commission provide opinions on technology transfer in China, which means that more than 80% of the members are majority members. There is no objection to this type of issue.
Second, on the issue of equity, China’s foreign direct investment has changed from a Sino-foreign joint venture to a wholly foreign-owned one. The U.S.-China Trade Committee’s report states that about 75% of U.S. companies can operate in China with 100% equity. It is not subject to joint venture and equity restrictions.
Again, there is currently no U.S. domestic industry filing application and evidence to prove the allegations. On October 9, 2017, the United States did not focus too much on mandatory technology transfer at the public U.S. 301 investigation hearing.
According to the report of the member companies of the China Chamber of Commerce for Import and Export of Machinery and Electronic Products, the contents of the 301 investigation allegedly did not conform to the actual situation. The joint venture of the company and the technology transfer were all negotiated freely. The negotiations were initiated after equal negotiations. It was purely a market activity. And its subordinate departments did not participate in and did not engage in any kind of intervention. In addition, Chinese companies have full autonomy in their investment and acquisition projects, and there is no Chinese government’s promotion or promotion in the process of investment acquisition. Chinese companies have no possibility and means to force US companies to transfer assets and technology to Chinese companies.
On the contrary, the United States’ Export Administration Act imposes very strict regulations on the transfer and export of technology. The U.S. Foreign Investment Commission also has a number of U.S. rules under the “Foreign Investment and National Security Law” and the “Foreigner Mergers, Acquisitions, and Takeovers Regulations.” A large discretionary power decides whether or not to approve a foreigner’s investment in M&A by U.S. companies. In fact, the normal market-based commercial trade and investment behavior of Chinese and U.S. companies is often hampered by the U.S. government.
China has become a hot spot for high-tech companies to compete for investment
China’s intellectual property protection has been continuously strengthened and a relatively complete legal system for intellectual property protection has been established. China has been actively developing cooperation with the United States in the protection of intellectual property rights. China and the United States held three important negotiations on intellectual property issues and signed a memorandum. China has adopted many U.S. Patent and Trademark Bureau professionals' advice when it comes to amending the intellectual property legal system; China's State Intellectual Property Office and the U.S. Patent and Trademark Office signed the Sino-U.S. data exchange agreement in 2012 on patent searches and public housing for both parties. Intellectual property information provides new ways.
In addition, the cooperation between Chinese and US companies in the area of intellectual property rights has also continued to expand. In 2016, between Huawei and Apple, in January 2018, Google and Tencent reached a patent cross-licensing agreement. The legal system of intellectual property protection On the other hand, China has established a relatively complete legal system including the Patent Law, the Trademark Law, the Copyright Law, the Technology Contract Law, and the Science and Technology Achievements Conversion Law, and continues to improve. The intellectual property courts in Beijing, Shanghai, and Guangzhou have been established one after another. The number of intellectual property-related lawsuits has continued to increase, and from the individual cases announced in Guangdong Province, the proportion of Chinese and foreign parties winning similar lawsuits is similar. In addition, China’s patent applications for inventions have leapt to the top in the world. Payment of intellectual property royalties has become an important part of China's service trade deficit, reaching US$28.6 billion in 2017, which is 20% higher than 2016.
As China’s protection of intellectual property continues to increase, it has abundant intellectual resources and a complex market structure. In recent years, multinational corporations have accelerated the pace of setting up R&D institutions in China. China has become an important link in the creation of global technology inventions in the value chain. General Electric proposed 'In China, for China and for the World' (in China, China, and the world) as the vision and positioning of GE China.
U.S. companies have used China's indigenous resources, markets, and platforms to achieve more than expected growth in China through spontaneous technology transfer. For example, U.S. cars have actively transferred technology after entering China and have achieved significant market share in a relatively short period of time. With the improvement of China’s innovation environment and the improvement of innovation levels, the way in which transnational corporations maintain their technological competitiveness has changed, and US companies have actively chosen to increase R&D investment and technology transfer in China’s innovative regions. Apple has established 2 in China. A research and development center, whose CEO announced that it will set up two more R&D centers in China. If it restricts the international circulation of technical knowledge, it will actually limit the innovation of American information technology companies.
Individual cases meet international practice
Individual cases requiring technology transfer conformed to international practice. According to the requirements of the “second supplier” in the “Anti-Monopoly Law” of China, technologies related to the products and services related to the development of the national economy are related to the formation of market monopolies after the merger of enterprises and require technology. Transfer. For example, when U.S. Pfizer merged with Wyeth in the US, the Chinese Ministry of Commerce required the merged enterprise to transfer the technology patent for pig vaccine to Chinese companies.
China requires that the provisions of the open source code conform to international practices. Many countries in the world have requested the company to share the source code with the regulatory authorities for the purpose of maintaining national cyber security, so that they can be included in the government procurement catalog. China requires the open source code to be In consideration of national security to prevent hackers from attacking, it does not mean technology transfer or spillover. As in the disclosure of technology in the patent system, while the government is open, government regulators are responsible for protecting the technology and intellectual property of related companies, but for There are no special requirements or restrictions on these products in the commercial and consumer markets. For example, since Win7 uses a different cloud service than window XP, the government procurement catalog does not include Win7, but the operating system can be legally sold in the Chinese commercial market. .
China has not used the internationally-applicable standard patent compulsory transfer terms. In accordance with international practice and commercial practices, all countries require the owner to transfer the right to use the standard patent. This means that in the high-tech fields such as electronic information, technology-based With rapid development and changes in industry standards, relevant government departments in various countries can impose mandatory authorizations on standard patents, and this is also included in the Chinese “Patent Law.” However, at present, China has not used any standard compulsory patent transfer clauses.