Research On Issues Of Intellectual Property Rights In Sino-US Trade Friction

Developing Sino-US economic and trade relations serves the fundamental interests of both peoples. Following the establishment of diplomatic relations between the People's Republic of China and the United States, bilateral economic and trade ties have grown fast, featuring complement and mutual benefit. Occasionally, however, frictions and differences took place. Along with China economic developing increasingly and products having more competitive power, the trading friction between America and China was also intensified increasingly. At present, the issue of intellectual property rights much too stressed by the United States has been the main friction form in the economic and trade relations between the two countries.The paper introduce the actuality, the reason and countermeasure of intellectual property disputes in the Sino-US trade frictions. There are four parts in the paper.The first part was written to introduce documents on intellectual property rights and the paper structural. Some points is: intellectual property rights will be of great benefit to development of high and new technology. But intellectual property rights arose disputes of international benefit.The second part is about evolvement of intellectual property disputes and peculiarity in Sino-US intellectual property friction . The Section 337 investigation has been became the focus of Sino-US intellectual property issue. According to statistics, more patent-based complaints have been filed at the US International Trade Commission (ITC) against Chinese companies in 2003 than of companies from any other country in the world except the United States. Of the first 400 ITC investigations (conducted between 1972 and 1998), only five (about 1 per cent) were against companies from China. During the year 2003 alone, in contrast, almost 25 per cent of all cases were against Chinese companies. There were 2 investigations only a celendar month from 1 to 31 January 2008. Chinese companies are set to feel the strong power of the Section 337 investigation in the recently years, as more patent-based complaints are expected to be filed at the ITC against Chinese companies. This will likely become a future tendency as China's integration into the US market continues to intensify. The ITC is an agency of the US government that investigates allegations of unfair trade practices if unfair practices are found. Investigations of unfair trade practices based on violations of US patents and other intellectual property rights (IPR) related to imported products are referred to as "Section 337 cases" ,because they are based on section 337 of the US Tariff Act of 1930. Most recent Section 337 cases have involved patent infringement. Chinese companies attempt to enter or increase their presence in the US market, other participants in the market will use intellectual property, such as patents, copyrights and trademarks, to either block access to the market or obtain licence fees from Chinese companies. For example, many companies generate large patent portfolios to create what some analysts have called "non-tariff trade barriers." These barriers are then used, either properly or improperly, to block or control entry into the US market. Section 337 investigations can bring very serious impact to Chinese companies as Chinese companies faced with Section 337 investigations are not only exposed to very significant expenses and business disruptions, but also face one of the most potent remedies under US international trade law. Section 337 investigations move very quickly and frequently involve complex factual and legal issues. Therefore, such proceedings can be quite expensive and draw heavily on the resources of companies that are named as respondents in Section 337 investigations. Although the ITC does not award damages in Section 337 investigations, the ITC can issue exclusion orders and cease and desist orders. Exclusion orders can block importation of accused goods from a specific company. There are means to overcome such orders, but they can be difficult and expensive.The third part is given the reasons of intellectual property friction. The reasons of Sino-US intellectual property disputes are: The first is a natural consequence of China's growing emergence as a major force in manufacturing, research and development and international trade; The second is non-balance in the Sino-US trade; The last is different systems in the Sino-US intellectual property rights.The last part is about measures that will be taken to face intellectual property disputes by Chinese companies and government . What can Chinese companies and government do, facing the severe situation? there is no way to absolutely prevent a Section 337 case from being filed against a company, but there are steps that a company can take to minimize the chances of such a case and minimize the impact of Section 337 investigations if cases are filed. One positive trend that seems to be developing is an increased willingness by Chinese companies to face the section 337 investigation. Chinese companies can actually also utilize Section 337 to protect their own interests in the US market. At the same time, China government not only improve intellectual property systems, but also encourage Chinese companies to enhance the ability of independent innovation.