The 18-page chapter, which represents one-fifth of the entire agreement, calls for various obligations on trade secrets, pharmaceutical intellectual property, geographical indications, trademarks, patents, e-commerce violations and enforcement against piracy and counterfeit goods. The theft of intellectual property and trade secrets has long been a concern of U.S. companies and has been one of the main triggers of the Trump administration`s escalation of tariffs. The agreement contains provisions for the protection of confidential information that is considered a trade secret – U.S. companies believe this is not sufficiently protected by Chinese law. Considerable progress is also being made with regard to the protection of pharmaceutical protection of intellectual property products. The agreement also calls on China to present an “action plan to strengthen intellectual property protection” within 30 days of the agreement`s entry into force. On December 13, 2019, the United States and China announced that they had reached a Phase One trade agreement. On January 15, 2020, President Trump and Chinese Vice Premier Liu He signed the U.S.-China Economic and Trade Agreement (“the Agreement”) at the White House. In the deal, China promised to sharply increase its imports from the U.S. in response to U.S.
demands. However, no agreement has yet been reached on industrial policy reforms and subsidies requested by the United States from China, nor on the lifting of additional tariffs on Chinese products claimed by China from the United States. Future negotiations on these issues are expected to face great difficulties. Meanwhile, much of the tariffs for companies exposed to the cost of the trade war remains less optimistic. Several multinationals have already relocated partial operations to third countries in ASEAN. So far, the trade war between the U.S. and China has mostly taken the form of reciprocal tariff increases. Although both sides have avoided further tariff increases and a de facto “ceasefire” has been put in place, many challenges remain and the way forward to end the trade war remains challenging. The 96-page agreement consists of eight chapters on intellectual property rights, technology transfer, food and agricultural products, financial services, foreign exchange regulation, trade expansion, dispute settlement and final provisions. It covers the main themes of the Section 301 investigation launched by the USTR against China in 2017. Below you will find a reading of the main provisions of the agreement. The original text in Japanese was published on February 19, 2020.
While this will help reduce the trade deficit between the US and China, the resulting decline in “net” exports (exports based on GDP minus imports) is expected to put pressure on the Chinese economy. Fourth, the opening up of financial services is good news for both sides, as the related commitments coincide with the opening up of the financial industry, which China has been promoting very proactively in recent years. Nevertheless, last week, the two countries announced that they would resume twice-annual talks on trade and economic issues, which were a convention under previous U.S. presidents.