Intellectual Property Plays a Role in U.S.-China Trade Relations

An investigation into China’s intellectual property policies was launched by U.S. Trade Representative Robert Lighthizer. The investigation was prompted by China’s policies that purportedly require foreign tech companies to turn over sensitive data and secrets in order to do business in China. The investigation was brought under a rarely used provision of the Trade Act of 1974 that gives the U.S. great latitude to impose trade restrictions upon China. Since the U.S. does not have a free trade agreement in place with China, it can, depending on the outcome of the investigation, unilaterally impose sanctions upon China, provided that the World Trade Organization does not intervene claiming that the China’s policies, namely forced technology transfer, falls under its purview.