BeijingReviewreportersZhouXiaoyanandZhangShasharecentlyheldanexclusiveinterviewwithWang,apartnerofthefirm,onthecausesoftheSection301investigation,theresultsofthehearingandChina鈥檚achievementsaroundintellectualpropertyright(IPR)protection.Aneditedexcerptoftheinterviewfollows:BeijingReview:WhatisaSection301investigation?AftertheWorldTradeOrganizationwasestablishedin1995,mostcountries鈥攊ncludingtheUnitedStates鈥攑romisedtodefuseconflictsthroughmultilateraltrademechanismsandputthesetypesofinvestigationsaside.WhyistheU.S.wieldingthestickofaSection301investigationagain?WangZhengzhi:Theinvestigationreferstothe301stprovisionoftheU.S.TradeActof1974,knownasSection301.TheUnitedStatesoftenquotestheprovisiontoretaliateagainstcountriesconsideredtoactinanunreasonableandunfairmannerintrade.
Illustratedinthe301stprovisionindetail,aSection301investigationaimstoprotectU.S.domesticindustries.FromtheU.S.perspective,thelawwasissuedtoprotectthenationalinterestsandtradeprofitsofU.S.enterprises.
Therefore,allU.S.tradepartnersmaybetargetedandbiggeroneswillbeinvestigatedmorefrequentlysincetheprovisionisnotadopteduntilthetradevolumereachesacertainlevel.Recently,thebilateraltradevolumebetweenChinaandtheUnitedStateshasgrownrapidly.Therefore,theSection301investigationhasbeenadoptedmoreoftenagainstChina.
Theinvestigationwillgeneratemanyeffectsanditsaimsaremultiple.First,thelawprotectsU.S.industries,whichisthereasonwhyitissupportedbymanyinthecountry.Italsocracksdownonrivalcountriessincecontain-ingcompetitorsistakenforgrantedinmarketcompetition.
TheMadeinChina2025strategyisanotherreasonfortheSection301investigation.CountriessuchastheUnitedStatesarepayingcloseattentiontothepolicyandwouldnotliketoseeagrowingrival.Asaresult,ithastakenvariousmeasurestocontainChina鈥檚growth.
WiththeeffortsfromyouandMr.Lian,whatwasachievedatthepublichearinginmidMay?
Allstakeholderswereentitledtoparticipateinthehearing.Therefore,ChinesestakeholdersmadetheirdemandsheardandrevealedtherealconditionsofChineseIPRprotectiontotheU.S.sidefacetofaceinordertoprotecttherightsofChineseenterprises.
First,werefutedthestatementthatChinaisweakonIPRprotectionandprovidedseveralpersuasivecases.ThenwepointedoutthatitisgroundlesstosaythatforeigncompaniescanonlydobusinessinChinathroughequityjointventureswithChineseenterprises.
OuropinionswerethusdeliveredtoU.S.officialsandthedirectinteractionmadethefactsclearer.
WhateffortshavebeenmadebyChinatoimproveIPRprotectionandwhatachievementshavebeenscored?
Overthepastdecades,ChinahasdefinitelymadegreatprogressinIPRprotectionwithmeasuresincludingestablishingacomplete,sophisticatedlegalsystem,increasingpenaltiesonIPRinfringements,strengtheninglawenforcementandraisingpeople鈥檚awarenessofIPRprotection.
First,China鈥檚IPRprotectionlawsboastahigh-levelandsophisticatedsystem.ThePatentLawissuedin1983,theTrademarkLawin1987andtheCopyrightLawin1990arethethreepillarsofChineseIPRlaws.TheyareonaparwithIPRlawsofcountrieswiththehighestlevelofIPRprotection,especiallythecivillawsysteminGermany.WedrewlessonsfromtheachievementsofGermanIPRlawsandsettledtheframeworkofourlawsinthe1980s.
Second,wehavecontinuouslystrengthenedIPRprotectionbyimprovingthejudicialsystem.Forexample,wearefortifyingthepenaltiesonIPRinfringementsandhavestipulatedrelevantcriminallawsinatargetedmannertolowertheirthreshold.Inlessthan30years,ChinahastakenmanymeasurestoimplementlawsandimprovethejudicialsystemtoensuretheeffectsofIPRprotection.
Third,ChinahasstreamlinedgovernmentadministrationstoimproveIPRlawenforcement.GovernmentadministrationwasoverhauledearlierthisyearandIPRprotectionhasbeencommissionedtomarketsupervisionauthorities.TheStateIntellectualPropertyOfficehasbeenmergedwiththeStateAdministrationforIndustryandCommercetobecometheStateAdministrationforMarketRegulation,inchargeofimplementingpatentlaws,trademarklaws,andfoodandmedicinelaws.Thishelpssolvetheproblemscausedbyalackofenforcementstaff.
Insomefields,IPRprotectioncouldnotreachgrassrootslevelcommunitiesandcountiesbecausetherewerenosectorsinchargeofenforcingrelevantlaws,letaloneprofessionallawenforcers.Makingmarketsupervisionauthorities鈥攚hichhasapowerfulsystemcoveringalmosteverycornerofthecountryresponsibleforIPRprotectionhelpssolvethisproblem.
Fourth,Chinaissparingnoeffortinraisingpeople鈥檚awarenessofIPRprotectioninthewholesociety.Thepublicityhasbeenpromotedwellandnowevenprimaryschoolstudentsknowthatweshouldnotwatchpiratedcopiesofmovies.Withenoughpublicityinplace,Chinesepeople鈥檚awarenessofrespectingIPRshasbeengreatlyraised.
WehavemadelotsofeffortsandachievedalotaroundIPRprotection.WhydoestheUnitedStatescontinuetocriticizeusandusethisasapretextforlaunchingatradewar?
First,theUnitedStatesneedstobemoreob-jective.There鈥檚noperfectsystemintheworld.ForeignbusinessesmaycryfoulwhenevertheyaredisappointedbyChina鈥檚legalsystem,whichmayhaveprotectedthemninetimesoutof10.Weshouldn鈥檛onlyfocusonwhattheysay,butrather,weshouldfocusonwhattheydo.MostforeigncompaniesstillchoosetodobusinessinChinaeveniftheyhavesomecomplaints,meaningthattheyaregenerallysatisfiedwiththebusinessenvironment.
Second,ChinastillneedstoincreasethepromotionofitseffortsandachievementsaroundIPRprotectiontoforeigncountriesthroughallchannels.ItsvoiceisstillnotfullyheardandpeoplefromothercountriesmayholdastereotypeaboutChineseIPRprotection.Therefore,positivepublicityofChineseIPRpro-tection,especiallybymediaoutletswithagoodcommandoftheEnglishlanguage,shouldbelargelystrengthened.Inaglobalizedera,weshouldobjectivelyandproactivelypublicizetotheworldoureffortsandachievementsaroundIPRprotection.
Astradeconflictaccelerates,tensionsintheIPRfieldhavealsoincreased.HowdoyousuggestChineseenterprisesbetterprotectthemselvesanddefendtheirrightsandinterests?
Toputitsimply,theyshouldtakethreemeasures.First,ittakesagoodblacksmithtomakesteel,therefore,Chineseenterprisesneedtostrengthenindependentresearchanddevelopmentandhavetheirowntechnologiesandproducts.
Second,theyshouldprotecttheirinnovationsthroughappropriateapproachesunderthemodernIPRprotectionsystem.It鈥檚necessarytoarmoneselfbeforeenteringabattlefield.
Third,theyshouldcommissionprofessionalstocarryoutIPRinvestigationsbeforeenteringanunfamiliarmarket.ManyChineseenterpriseshavenowstartedtomakeFreedomtoOperateevaluationsbycommissioninglawyerstoinvestigateforeignmarketsbeforelaunchingproductsinthosemarkets.Withoutnecessaryinvestigationsbyprofessionals,manyproblemsmayloom,includingtensionsbetweenrivalsandeventradeconflicts.
Currently,theChina-U.S.tradeconflictisaccelerating.Whatareyourpredictionsonthetradewar?
Tradeconflictswillcontinuetoexistaslongasthereareboundaries,customsandsovereigncountries,andtheymaybecomemorefrequentastradevolumeincreases.
First,IthinkitisnotsurprisingforChinaandtheUnitedStates鈥攖hetwolargesteconomiesintheworld鈥攖ogetintotradeconflicts.Itwillnotstoporbeeliminatedinthenearfuture.
ButIdon鈥檛thinkitwillspiraloutofcontrol.Anyrationaladministration,atleastinChina,wouldpreventthesituationfromgettingtoanextremeandcausingseveredamagetoitsowneconomy.
Tosumup,thingswillnotgetoutcontrolbutthetensionswilllastforsometime.Tradetensionswillbeeasedafterawhilebecause,attheendoftheday,developmentisthecommongoalofbothsides.
CopyeditedbyRebecaToledoCommentsto
WangZhengzhi(left)andLianJiefromtheGlobe-LawLawFirmparticipateinapublichearingofthe301investigationheldinmid-MayinWashington,D.C.COURTESYPHOTO