From the "301 clause" to see the "Sino-US trade war"

On March 22, 2018, US time, with the signing of a "Memorandum of China's Economic Aggression" by US President Trump, the "Sino-US Trade War" kicked off again and quickly occupied the headlines. The United States announced that it would apply the "301 clause" to impose large-scale tariffs on high-tech goods worth about $60 billion million exported from China to the United States, while restricting Chinese enterprises' investment and mergers and acquisitions in American enterprises. China responded strongly and announced that it would impose tariffs on US imports of Chinese agricultural products worth about 3 billion yuan, which makes people feel strongly that China is a high-tech power, while the United States is a traditional agricultural country. Premier Li Keqiang said in his speech that the trade war is contrary to trade principles and hopes that the United States will not be sentimental and that China will strictly protect intellectual property rights.

Although the two countries are rubbing their hands, politicians will always reach an understanding at the last minute. This is not the main point of this article-we are concerned about what is the "301 clause? Why can the United States use what it says and uses so willfully that it does not hesitate to start a direct trade war with China? How is the trade war linked to intellectual property? How to deal with the" Sino US trade war "? Many people may have such questions in their hearts, and then the author will unveil them one by one.

1. on the "301 Clause"

The definition of "301 clause" is narrow and broad. The "301 clause" in the narrow sense refers to section 301 of the US Trade Act of 1974, also known as the "general 301 clause". The broad "301 provisions" cover the contents of sections 1301-1310 of the 1988 Comprehensive Trade and Competition Act, including "general 301 provisions", "special 301 provisions" and "super 301 provisions" and related supporting measures. Among them, the "special 301 clause" mainly stipulates the protection of intellectual property rights and the market access of intellectual property, while the "super 301 clause" mainly focuses on the foreign trade barriers of the United States. The "General 301 Clause" forms the basis of the other "301 Clauses", while the other "301 Clauses" are specific refinements of the content of the "General 301 Clause.

The "301 Clause" stipulates that the Office of the United States Trade Representative (USTR) has the right to initiate investigations into what it considers to be "unfair" or "unreasonable" trade practices carried out by other countries against the United States, and has the right to recommend that the President of the United States take unilateral sanctions based on the results of the investigation, Including imposing retaliatory tariffs, restricting imports, stopping the implementation of relevant agreements, and withdrawing trade preferences. That is, the President of the United States and the Trade Representative have absolute discretion, without any evidence or "arbitration" by any institution. Once the investigation procedure is initiated, as long as the United States is "convinced", "determined" or "determined", the United States can unilaterally initiate "trade sanctions". Therefore, in essence, the "301 clause" is a means for the U.S. government to use trade policies to expand exports and force other countries to accept its trade rules through sanctions. It was once regarded as a "nuclear weapon" for the United States to conduct trade protection and deterrence ".

In August 2017, USTR officially launched a trade investigation into China in the field of intellectual property rights, focusing on whether China infringes on US intellectual property rights and forces the United States to transfer technology to China, which is the scope of the "special 301 clause.

2. Counts the "Article 301 Investigation" Launched by the United States against China"

Since the beginning of the 20th century, before this "301 clause investigation", the United States has conducted a total of five "301 clause investigations" against China, including two "general 301 clause investigations" and three "special 301 clause investigations":

1. "Special 301 Provisions Survey" 1991"

In April 1991, the United States launched a "special 301 clause investigation" in the field of intellectual property rights, focusing on the defects of China's patent law and the lack of protection of American copyright, trademark and trade secret. After negotiations, the two sides signed an agreement on the protection of intellectual property rights in 1992. China has successively revised the Patent Law and the Trademark Law, and promulgated the Anti-Unfair Competition Law.

2. "General Terms of 301 Survey" 1991"

In October 1991, the United States launched a "general terms of 301 investigation" on China's market access, focusing on the unfair trade barriers encountered by American goods in the process of entering the Chinese market. After negotiations, the two sides reached an agreement in 1992, in which China promised to remove trade barriers on some US goods in the next five years.

Survey of Special 301 Provisions, 1994"

In June 1994, the United States once again launched a "special 301 clause investigation" against China in the field of intellectual property rights, focusing on the implementation of China's intellectual property laws and regulations, and requiring China to open its market to American intellectual property products. After negotiations, the two sides signed a memorandum of understanding on intellectual property rights in 1995, and China promised to strengthen intellectual property protection.

Survey on Special 301 Provisions, 1996"

In April 1996, the United States once again launched a "special 301 clause investigation" against China in the field of intellectual property rights. In this investigation, the United States directly adopted sanctions against China. After negotiations, the two sides signed a third memorandum of understanding on intellectual property rights in 1996.

5, 2010 "General Terms of 301 Survey"

In September 2010, the United States launched a "general 301 clause survey" on China's clean energy field, focusing on the laws, policies and subsidies in China's clean energy field. Under the WTO dispute settlement mechanism, China agreed to cancel subsidies for wind power companies that use domestic components.

By analyzing the results of previous investigations, both sides ended with negotiations or consultations and reached an agreement, and the President of the United States finally implemented fewer retaliatory measures. According to statistics, since the promulgation of the 1974 trade law of the United States, the United States has launched a total of 122 "301 clause investigations" against other countries, most of which ended in the victory of the United States. This method has become a sharp weapon for the United States to conduct trade negotiations with other countries.

3. on this "Article 301 Survey"

The intellectual property dispute between China and the United States has a long history. Throughout the previous "301 clause investigations" have focused on the field of intellectual property rights, this "301 clause investigation" is still the case. In April 2017, the United States issued the "2017 Special 301 Report" (hereinafter referred to as the "Report") and once again included my country on the "priority watch list" on the grounds that "China's long-term and latest intellectual property issues are very noteworthy". That is, there are still a large number of acts of piracy and counterfeiting, exporting counterfeit goods, stealing trade secrets and taking technology transfer as market access conditions in China, and China has not yet established an effective intellectual property enforcement system to solve the above problems.

The report clearly identifies the challenges and problems faced by the United States in the field of intellectual property rights in China, including:

1. Insufficient protection of intellectual property rights

The report pointed out that in my country, it is difficult for American intellectual property rights holders to obtain adequate and effective intellectual property protection, and it is difficult to obtain fair and just market access opportunities for intellectual property-intensive products, services and technologies.

2, trade secret protection legislation is insufficient.

The report points out that at present, China is still in a state of insufficient legislation on trade secrets. In some legal provisions and other measures related to the protection of trade secrets, there are problems such as confusion of jurisdiction, difficulty of proof and low civil compensation.

3, piracy, counterfeit goods rampant

The report pointed out that my country still has the problem of exporting pirated and counterfeit goods, and some can also cause health and safety risks. At the same time, the problem of counterfeiting and piracy in our country has spread to the e-commerce market, which accounts for an estimated 40% of global e-commerce sales.

4, the relevant policies are not conducive to the United States.

The report pointed out that my country has established relevant policies to promote independent innovation, but these policies may put American intellectual property-intensive industries at a disadvantage and not benefit American intellectual property rights holders.

It can be seen that insufficient trade secret legislation, piracy and counterfeiting, my country's related policies to encourage independent innovation, etc. are still the focus of the United States, and it has also become a breakthrough point for the United States to launch a trade war against my country.

On March 22, 2018, U.S. time, U.S. President Trump signed a presidential memorandum based on the results of the "Article 301 Investigation" and proposed to take the following actions: First, the United States will launch a WTO lawsuit against my country's discriminatory technology licensing; second, imports from my country Tariffs are imposed on some products, including: high-performance medical equipment, biomedicine, new materials, agricultural machinery and equipment, industrial robots, new generation information technology, new energy vehicles, aviation products, and high-speed rail equipment; the third is to restrict my country's investment and mergers and acquisitions in the United States. It can be said that the "Sino-US trade war" launched by the United States in the name of intellectual property rights is still essentially a political act.

4. on responses

The United States "2017 Special 301 Report" raised many legal issues in our country. Although President Trump is very different from previous presidents after taking office, he does not seem to know how to govern, but he must not be underestimated. Being able to become a tycoon in the United States proves its management ability and EQ. This trade war is obviously strong and weak, and it is estimated that China will make major adjustments to deal with it.

As a lawyer, this article only analyzes the response to the "Sino-US trade war" from a legal perspective.

1 At the Government Level

(1) Improve the legislation and revision of intellectual property rights.

First, the protection of trade secrets. In 2017, my country's General Principles of Civil Law was revised to clearly stipulate that trade secrets are one of the protection objects of intellectual property rights. However, unlike the Copyright Law, the Patent Law and the Trademark Law, trade secrets are not separately legislated. Part of the Anti-Unfair Competition Law. There is no effective regulation on how to provide adequate and effective protection of trade secrets, which leads to the lack of consistency of judicial decisions in trade secret cases, and may lead to the disclosure of trade secrets due to the lack of relevant regulations in the process of dealing with trade secret cases. In view of this, my country should speed up the improvement of trade secret related legislation. At present, related work is underway. The Intellectual Property Committee of the All-China Lawyers Association where the author is located has also been paying attention to and discussing issues related to competition law and trade secret protection.

Second, the protection of patent rights. The latest revision of the "Patent Law" in my country occurred in 2008. With the rapid development of the high-tech field, the current "Patent Law" has a lag, and it is necessary to speed up the improvement of related patent amendments. With the reform of the super-ministry system, the State Intellectual Property Office under the Market Supervision Bureau is also based on this consideration. The author believes that how to strengthen the powers of the Intellectual Property Office in the new era, and coordinate patents, trademarks, geographical indications, intangible cultural heritage, certification trademarks and even copyrights under one department is the direction of the next reform.

Third, on case guidance. China should speed up the introduction of relevant intellectual property case guidance, unify the judicial practice standards of similar cases, and avoid the situation that similar cases are tried in different places and the results are completely inconsistent.

(2) Strengthen the enforcement of intellectual property rights

At present, global trademark counterfeit goods are still produced and sold in large quantities, and technological development has also made the Internet a tool for the rapid dissemination of infringing content, and online piracy and counterfeiting are popular. On the one hand, the government should strengthen network supervision, strengthen law enforcement, and avoid the domestic environment to provide a safe haven for network piracy; on the other hand, strengthen the combination of civil, criminal and administrative tripartite, establish relevant standards for conviction and sentencing, and crack down on piracy and counterfeiting in a timely and severe manner.

2, industry associations and enterprise level

In order to deal with this trade war, for enterprises themselves, they should first make it clear that science and technology and innovation are the primary productive forces, and enterprises should sort out the intellectual property rights enjoyed by enterprises, the registration of the registration and the application of the application, so as to improve their intellectual property layout; secondly, enterprises should actively communicate and negotiate with legal advisers to establish intellectual property protection plans and investment plans in the United States; finally, enterprises should pay attention to exchanges with industry associations and peers, form a joint force in the industry, and actively contact lawyers to collect and retain evidence when they have been impacted, so as to make full preparations for safeguarding their rights in the future.

The author believes that the ultimate goal of the US trade war is to protect its own industries from infringement, to contain the development of relevant high-tech enterprises in China, and to hinder the pace of China's manufacturing 2025. Its essence is to divide the cake between countries. But specific to a certain industry or a certain enterprise, it may be a great harm. Therefore, for the manufacturing industry, both industry associations and enterprises must establish a complete intellectual property reserve, have a perfect and forward-looking intellectual property planning, and transfer the driving force of enterprise development from traditional resources and manpower to technological innovation and R & D investment, which is the truth, which is also in line with the new concept of the transformation of new and old kinetic energy in China.

All in all, although the US government's investigation of the "Special 301 Clause" launched by my country is suspected of being a "wolf in sheep's clothing", it is undeniable that my country's current intellectual property legal system does have many shortcomings compared with other developed countries. I hope to see that this "Sino-US trade war" can help improve my country's intellectual property legal system and change my country's manufacturing industry structure, adjust the unreasonable in the development process and open the market in an orderly manner.

The war has started, only the continuous development and change in the competition can be in the advantage, this article is a personal point of view, for reference only.