‘China should provide a level playing field for IP protection and enforcement,’ the U.S. trade representative said in a report.
China remains on the priority watch list of the Office of the U.S. Trade Representative (USTR), the agency announced on April 29, saying that the country’s pace of addressing IP protection and enforcement “remained slow” in 2024.
USTR’s annual report now lists eight countries on its priority watch list for IP violations and concerns, after moving Mexico to the list from its watch list. The lists are compiled annually based on research and analysis of more than 100 trading partners.
“Americans take great pride as the world’s leading innovators and creators,” U.S. Trade Representative Jamieson Greer said in a statement.
“Our trading partners must address the concerns identified in the Special 301 Report and stop those stealing the intellectual property of hard-working businesses and individuals.
“President [Donald] Trump has a track record of empowering our innovators and workers, and this comprehensive report is a basis for the United States to take trade enforcement action against those not playing fairly.”
Communist China has been on the priority watch list for most years since the Special 301 Report was first issued in 1989. This year, the USTR said there are “serious concerns” about several longstanding issues, including technology transfer, trade secrets, counterfeiting, online piracy, copyright law, patent and related policies, bad-faith trademarks, and geographical indications.
“China should provide a level playing field for IP protection and enforcement, refrain from requiring or pressuring technology transfer to Chinese companies at all levels of government, open China’s market to foreign investment, and embrace open, market-oriented policies,” the report reads.
USTR said the phase-one trade agreement, signed in January 2020 during the previous Trump administration, included several Chinese commitments, such as trademarks, copyrights, and pharmaceutical-related IP.
“China has failed to implement or only partially implemented a number of these commitments,” the report reads. “The United States continues to closely monitor China’s progress in implementing its commitments under the Phase One Agreement.”
In the report, USTR noted that China continues to be the “world’s leading source of counterfeit and pirated goods,” citing data from the U.S. Customs and Border Protection (CBP).
In fiscal year 2024, CBP seized more than 32 million counterfeit items, which would have been worth more than $5.4 billion if they had been genuine. Counterfeit goods from China and Hong Kong accounted for about 90 percent of the total quantity seized.
USTR said that counterfeiting activities in China have increased as the country’s economy declines.
“The production, distribution, and sale of counterfeit medicines, fertilizers, and pesticides, as well as under-regulated pharmaceutical ingredients, remain widespread in China,” the report reads.
The report highlights a new development in March, when China’s State Council issued the “Provisions on the Handling of Foreign-Related Intellectual Property Disputes.” USTR called the latest Chinese measure “troubling” because it “seemingly legitimizes political intervention in IP disputes.”
“This new measure authorizes Chinese government agencies to take countermeasures against and impose restrictions on foreign entities that ‘use intellectual property disputes as an excuse to contain and suppress China’ and also to ‘take discriminatory restrictive measures against Chinese citizens or organizations,’” the report reads.
Aside from China and Mexico, the USTR’s priority watch list also includes Argentina, Chile, India, Indonesia, Russia, and Venezuela.
The watch list includes Algeria, Barbados, Belarus, Bolivia, Brazil, Bulgaria, Canada, Colombia, Ecuador, Egypt, Guatemala, Pakistan, Paraguay, Peru, Thailand, Trinidad and Tobago, Turkey, and Vietnam.
Last month, Sen. Tom Cotton (R-Ark.), chairman of the Senate Select Committee on Intelligence, took to social media platform X to mark World Intellectual Property Day, which is celebrated annually on April 26.
“This World IP Day, remember: China doesn’t innovate—it steals. From semiconductors to biotech, they’re looting American ideas to build their military. I’ll keep fighting to stop it,” Cotton wrote.
In January, Cotton and his Senate colleagues reintroduced the Restoring Trade Fairness Act, which aims to revoke China’s permanent normal trade relations status.