China to raise penalties on IP theft in trade war compromise

Beijing will also look into lowering the thresholds for criminal punishments for those who steal IP

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Chinese President Xi Jinping last week said his nation wants to work toward a phase-one trade agreement with the US that is based in part on “equality”. Photo: DPA

Published: 4:15pm, 25 Nov 2019Updated: 9:26am, 11 Dec 2019

China has said it will raise penalties on violations of intellectual property (IP) rights in an attempt to address one of the sticking points in trade talks with the United States.

The world’s second largest economy will also look into lowering the thresholds for criminal punishments for those who steal IP, according to guidelines issued by the government on Sunday. It did not elaborate on what such moves might entail.

The US wants China to commit to cracking down on IP theft and stop forcing American companies to hand over their commercial secrets as a condition of doing business there. China said it is aiming to reduce frequent IP violations by 2022 and plans to make it easier for victims of transgressions to receive compensation.

The two countries are working toward a partial trade deal and leaving the more controversial issues for later discussions. China’s chief trade negotiator spoke last week about the country’s plans for reforming state enterprises, opening up the financial sector and enforcing IP rights – issues at the core of US demands for change in China’s economic system.

“Strengthening IPR protection is the most important content of improving the IPR protection system and also the biggest incentive to boost China’s economic competitiveness,” according to the guidelines. Local governments will be required to implement the strengthening of IP rights, it said.