The Study On The Compulsory And Discriminatory Character Of China's Technology Transfer Policy

In 2018,the United States issued the "Section 301 Report" on China,accusing China,s technology transfer policy of being compulsory(that is,there are"forced technology transfer requirementsand)and discriminatory(that is,there are"discriminatory licensing restrictions"which violate the principle of national treatmen treatment under WTO).The compulsory and discriminatory character identification of China',s technology transfer policy needs to be discussed separately,but both can be examined under the international technology transfer rules within the WTO framework.In the case of discriminatory accusations,the US invoked the TRIPs clause and referred it to the WTO Dispute Settlement Body(DS542);for the compulsory accusations,although the US did not explicitly invoke it,its legal basis is actually technology transfer performance requirements prohibition rules.As a new trend in international rules on technology transfer,the technology transfer performance requirements prohibition rules are attempted to be derived from the clauses of principle,technology transfer clauses and other performance requirements prohibition rules of TRIPs and TRIMs.Since it is not expressly provided in the text,and there is no bilateral investment treaty between China and the United States which can establish this rule,the US cannot invoke this rule against China directly.But looking for its roots,the compulsory accusations of China' s technology transfer policy can also be placed under the WTO framework for analysis.Therefore,on the basis of summarizing the relevant rules of technology transfer in WTO,this paper attempts demonstrate whether China' s technology transfer policy has compulsory or discriminatory character according to the international arbitration practice,WTO rules of technology transfer and the context of China5 s technology transfer policy,showing a mode of thinking with "dual character",that is,China's technology transfer policy is falling into a "grey areas":On the one hand,through demonstration,evidence can be found to prove the non-compulsory and non-discriminatory character of China' s technology transfer policy.(1)Non-compulsory character:In terms of Chinese laws and regulations,there is no compulsory technology transfer provision;in terms of institutions and policies that may result in the "negative effect" of compulsory technology transfer,there are two different criteria in arbitration practice to judge whether they are "compulsory".After a comprehensive analysis,it should not be considered compulsory.(2)Non-discriminatory character:although the accusations from the US seem to be established by comparing the four provisions which were accused violate the principle of national treatment with the relevant provisions of the Contract Law,it can be found through explanation that Article 29.3 of Regulations of the People's Republic of China on the Administration of the Import and Export of Technologies(TIER)is consistent with the relevant provisions of the Contract Law and there is no differential treatment;article 24.3 and article 27 of the TIER ostensibly restricts the right of both parties to the technology import and export contracts to agree on matters relating to technological improvement,but as far as the final result is concerned,it does not violate the principle of national treatment under WTO,as the parties have a right to choose the lex causae;the rationality of Article 43.2(4)of Regulations for the Implementation of the Law of the People's Republic of China on ChineseForeign Equity Joint Ventures(JV Regulations)can be found in Article 30 of the TRIPs.Therefore,it can be said that China's international technology transfer policy is not discriminatory.On the other hand,there is uncertainty in the application of the cognizance criteria of "compulsion"in arbitration practice,and there is something questionable in the justifications of the discriminatory character,which provides a handle for the accusations from other countries.(1)The implementation of China' s technology transfer policy does lead to the negative impact of "forced technology transfer",its compulsory identification results depend on which kind of cognizance criterias will be adopted by the arbitral tribunal;(2)In addition to the legality of Article 29.3 of the TIER,the defences against the other three clauses may not be supported by the arbitral tribunal.Therefore,China' s technology transfer policy is actually in a "grey areas" on compulsory and discriminatory issues.The reason for this phenomenon is that China's technology transfer policy tends to encourage foreign investors to transfer technology and protect domestic vulnerable enterprises,due to various theoretical foundations and practical needs.Although the content that is apparent inconsistent with the WTO rules has been cleared when China joined the WTO,other rules with the above-mentioned tendencies are being questioned with the development of economic strength and scientific and technological innovation ability of China:internally,these rules gradually deviate from the basic status quo and development requirements of the state and domestic enterprises;externally,these rules are gradually challenged by factors such as equal treatment pursued by developed countries.As far as the current national conditions are concerned,the implementation of this type of protective rules is not necessary.Combining with the latest legislative practice,China's technology transfer policy is and should be further developed to a higher level.