Unilateral Tariffs vs. The Rule of Trade Law: The Case of Trade Secrets

President Trump is seeking to apply tariffs to $50 billion of imports of some 1,300 products from China. He is targeting telecommunications and other high-technology sectors where he and others contend that American companies have, in effect, been forced to turn over their technology to Chinese partners – in some cases by revealing their trade secrets – in exchange for being allowed to do business in China and have access to the booming Chinese market. These tariffs are to be imposed outside the legal bounds of the WTO treaty through unilateral actions taken under Section 301 of the US Trade Ac t of 1974.For many of these U.S. allegations about China, however, WTO obligations apply, and could provide more effective recourse.  The various options under the WTO treaty for challenging Chinese trade practices will be explored in more detail in a forthcoming paper. This blog post focuses on one particular WTO obligation, covering trade secrets.The Trump administration has been raising concerns about China ’s failure to protect trade secrets, but evidently ignored so far is Article 39 of the TRIPS Agreement in the WTO treaty, which establishes a WTO obligation for the “Protection of Undisclosed Information.”[1] The United States was among the leaders in advocating the inclusion of Article 39 in the TRIPS Agreement as part of the WTO treaty, but the United States has, to date, not initiated an action in WTO dispute settlement claiming a violation by China of this WTO obli...
Source: Cato-at-liberty - Category: American Health Authors: Source Type: blogs