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EU launches WTO case against China over Huawei, Xiaomi tech infringements
- Brussels sues Beijing for allegedly penalising European firms for seeking to protect their patents from Chinese patent theft in foreign courts
- It follows a high-profile lawsuit over China’s alleged economic coercion of Lithuania, which was filed to the World Trade Organization last month
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Finbarr Berminghamin Brussels
The European Union has launched a lawsuit against China, claiming that it is using domestic courts to undermine intellectual property laws and allowing Huawei, Xiaomi and other telecoms giants to secure cut-price technology licences.
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A World Trade Organization (WTO) case lodged in Geneva on Friday said Beijing was using new legal mechanisms known as “anti-suit injunctions” to prevent international companies from suing Chinese counterparts in foreign courts for their use of technology without licences or permission.
Firms that have made complaints – including Sharp, Ericsson and Nokia – have been threatened with daily fines of €130,000 (US$148,000) or criminal charges, meaning executives could be jailed in China for non-compliance, according to the EU.
Brussels officials said Chinese firms such as Huawei, Xiaomi, ZTE and Oppo had taken advantage of these injunctions – which were ushered in by a Chinese supreme court ruling in August 2020 and subsequently approved by the National People’s Congress – to cut their licensing fees in half.
The EU sees it as part of an overall Chinese strategy to transfer technology for 3G, 4G and 5G to China for a reduced fee, but also to set global rules governing intellectual property protection.
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Officials said they had raised the issue with China at the WTO, bilaterally and in various other legal forums, but not had a satisfactory response from Beijing.
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