The U.S. Trade Representative’s Office warned Thursday that China had to do more to prevent intellectual property theft, stating that country has not implemented any reforms and remains a “hazardous and uncertain environment” to operate in. A USTR official indicated that the Trump administration could pursue additional tariffs against China if reforms don’t happen.
The designation comes as the USTR is set to resume ongoing trade talks with China with meetings in Beijing next week.
“Our clear message to China is that it should address all problems identified in the Special 301 report. We will continue to consider all available avenues,” a USTR official told reporters. The official said that the administration would consider Section 301 tariffs, which President Trump has used to place tariffs of 10 to 25 percent on $250 billion of Chinese goods.
The USTR released an annual report on intellectual property protection on Thursday, which reaffirmed that China was on its “priority watchlist.” The report stated that despite promises by Beijing to reform the “results to date have disappointed” and its refusal to do more “suggest that China intends to continue business as usual.”
[Related: China: US ‘selfish’ about intellectual property rights]
The report states that, while China did enact some modest reforms to its judicial system in the last few years, it has not amended other key laws that facilitate the intellectual property violations, including online piracy, counterfeiting, and registering trademarks in bad faith, among other actions. Additionally China has refused to curb the sale and export of counterfeit goods, the administration alleges.
U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin are scheduled to travel Beijing next week to continue trade talks and their counterpart, Chinese Vice Premier Liu He. Liu will travel to the Washington, D.C. the following week with the aim of wrapping up the talks.
The talks have been snagged over issues regarding the enforcement of the deal, because the U.S. has pushed for imposition of tariffs without retaliation from China as the mechanism. Trump has also indicated that the U.S. wants to keep at least some of the existing tariffs against China in place. Mnuchin has said that the talks are close to wrapping up.
