US: China's theft of trade secrets a major concern

Posted at 05/01/14 8:22 AM

WASHINGTON - Washington said Wednesday that China's efforts to steal US trade secrets are of "significant concern" as it again listed the country as a major violator of intellectual property rights.

In its annual "Special 301" report on IP rights violators, China led 10 countries on the US Trade Representative's "priority watch list", marking its 25th year on the list.

Despite some improvement in cooperation over combating counterfeit products and software and entertainment piracy, the USTR said, China is still the center of huge losses for US rights holders.

IP rights holders still face "serious obstacles" to enforcing their rights in all forms inside China, the report said.

The most serious problem is trade secret thefts, which go on both inside and outside China.

"Conditions are likely to deteriorate as long as those committing such thefts, and those benefiting, continue to operate with relative impunity," the USTR said.

The thieves can use the stolen secrets to boost their competitive advantage and even to enter into business relationships with the victims, it said.

"The United States strongly urges the Chinese government to take serious steps to put an end to these activities and to deter further activity by rigorously investigating and prosecuting trade secret thefts conducted by both cyber and conventional means," the USTR said.

Also perennially present on the priority watch list were Chile, India, Indonesia, Thailand and Turkey, mostly accused of turning blind eyes to widespread piracy of software, entertainment and branded goods.

The others on the list were Russia, Algeria, Pakistan and Argentina.

The USTR meanwhile praised Italy and the Philippines for enforcement progress that saw them removed from the broader "watch list" of 27 countries with high levels of violations of IP rights.

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