U.S. Formally Begins Probe of China Technology Transfer
18 August 2017 - 10:57PM
Dow Jones News
By William Mauldin
WASHINGTON -- President Donald Trump's trade chief on Friday
formally launched an investigation into Chinese efforts to secure
technology and Beijing's treatment of intellectual property.
U.S. Trade Representative Robert Lighthizer said he notified Mr.
Trump Friday that he would launch the probe, which could result in
trade sanctions. He made the announcement just four days after Mr.
Trump directed Mr. Lighthizer to look into the matter.
"After consulting with stakeholders and other government
agencies, I have determined that these critical issues merit a
thorough investigation," Mr. Lighthizer said in a statement.
In addition to probing Chinese efforts to obtain U.S. technology
and intellectual property, the investigation under Section 301 of a
1974 trade law will also look into whether Beijing supports
cyberintrusion to obtain trade secrets or technology in ways that
harm American companies, the trade representative's office
said.
The case is the first formal China trade action taken by a
president who has long blasted the country for what he says are
improper commercial practices. On Monday as he signed the
directive, Mr. Trump said: "This is just the beginning."
White House aides said the probe could run for a year before any
decisions are made on imposing trade sanctions.
The move is part of a broader, complex diplomatic strategy of
juggling Washington's competing policy goals with China, balancing
the desire for more cooperation in controlling North Korea against
a desire to curb the $347 billion U.S. trade deficit with
China.
Mr. Trump set the process for the probe in motion on Monday,
just three days after he spoke by phone with Chinese President Xi
Jinping, and a few hours after China announced it would ban imports
of North Korean coal, iron, and seafood, enforcing United Nations
sanctions aimed at curbing Pyongyang's nuclear-weapons program.
China vowed to fight back and defend its interests if the U.S.
takes any measures that harm the economic and trade
relationship.
"China definitely won't sit back and watch," a Ministry of
Commerce representative said in a statement posted on the
ministry's website Tuesday. "China will absolutely take appropriate
actions to defend its legitimate rights."
In targeting Chinese intellectual-property practices, the Trump
administration is picking up an issue that has becoming
increasingly alarming to U.S. companies in recent years. They are
worried in particular about the combination of China's explicit
industrial policy seeking self-sufficiency in a range of tech
sectors like robotics and semiconductors -- articulated in its
"Made in China 2025" initiative -- along with a range of formal and
informal requirements for foreign companies to share proprietary
material with Chinese partners.
Mr. Lighthizer's office said Friday it will accept written
comments on the investigation through Sept. 28 and hold a hearing
in October.
Jacob M. Schlesinger contributed to this article
Write to William Mauldin at william.mauldin@wsj.com
(END) Dow Jones Newswires
August 18, 2017 17:42 ET (21:42 GMT)
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