Could China Change IP Law Dynamic Around The World?
Trump’s biggest gripe with China is that the competitive country doesn’t give it’s fair share when involving itself in the political and economic processes of the rest of the world — it’s why the Trump administration began a devastating trade war that put the world economy at risk. That war has shown few benefits, if any. But that might be changing: China recently proposed a new set of protections for intellectual property.
These new IP protections could accomplish two things: First, they could appease the Trump administration and help put an end to the trade war. Second, they could influence IP laws around the world.
Beijing made the announcement last Sunday, but failed to provide enough details for us to draw any detailed conclusions. According to China, the goal of the new guidelines is to increase intellectual property protections and increase enforcement of IP law. More importantly, those who break the newly proposed laws would be subject to punishments much more severe than before.
The Trump administration has made its opinion on Chinese IP theft abundantly clear. According to Trump officials, these thefts (allegedly made in large part by the Chinese government) have diminished United States GDP by billions of dollars. On top of that, the officials assert that Chinese thefts have resulted in the loss of thousands of jobs for U.S. workers.
Chinese officials have always rigorously contradicted these accusations, instead asserting that the alleged thefts never occurred — and that any trade secrets handled were the result of negotiations already made between the two countries.
Chief Asia Market Strategist Stephen Innes for AxiTrader said, “China is definitely offering up some pretty attractive olive branches. [China knows] if they don’t make structural concessions, Trump will likely levy more tariffs.” Innes also says that Trump simply wants “something to beat his chest about.”
This is not the first time China has promised significant change, which is why some are reluctant to take the news with anything other than a giant grain of salt. Those paying attention know how long it could take for the proposed changes to be enacted into law. In December 2018, the Chinese government implemented another round of legislation to protect foreign intellectual properties, but the changes won’t take place until sometime next year.
And some analysts say that all of these changes are much more likely superficial because they wouldn’t work for China’s government. They’re talking about the aforementioned structural changes that should reduce China’s role in its own economy — something that seems impossible.
The biggest takeaway is this: China is obviously ready to play ball with the Trump administration, and both sides want a swift end to trade-related hostilities.