In October 2019, President Trump and Vice Premier Liu held a joint press conference announcing that a Phase 1 agreement had been reached in principle and indicated that an additional Phase 2 agreement and possibly a Phase 3 agreement would occur thereafter, as the two nations continued to negotiate beyond what was described in Phase 1. For those who cheered when the agreement was signed, it is a kind of species between two great powers, as evidenced by the depth and completeness, and improves the very unfortunate status quo. While there are much-anticipated problems, but ultimately not in the final text, the current agreement cannot in any way eliminate the uncertainties of international trade resulting from the trade war, particularly for companies that currently produce goods in China for customers in the United States. It can also lay the groundwork for further negotiations. However, the importance of the agreement in resolving bilateral issues and not as a temporary ceasefire should not be overstated. The deal leaves tariffs on about $360 billion in Chinese imports, with the government`s leverage hoping to generate concessions in the future. The 18-language chapter, which represents one-fifth of the comprehensive agreement, imposes various obligations on trade secrecy, drug-related intellectual property, geographical indications, trademarks, patents, e-commerce infringement and enforcement of pirated and counterfeit goods. The theft of IP and trade secrets has long been a concern of American companies and one of the main triggers of the Trump administration`s customs escalation. The agreement contains provisions for the protection of confidential information that are considered trade secrets – U.S. companies feel that this is not sufficiently protected by Chinese law.
Considerable progress has also been made in protecting drug-related intellectual property. The agreement also calls on China to present an “action plan to strengthen intellectual property protection” within 30 days of the agreement`s entry into force.Back to Blog