Chinese market ‘too big to ignore’ despite IP concerns

For Nicolas Correa, the CEO and president of Correa, a machinery manufacturing company, Chinese dubious practices over intellectual property are not an abstract problem “We trained a Chinese employee for a year in Spain to become chief assembly officer in our factory in China”,he told during the China International Import Expo (CIEE).

Chinese market ‘too big to ignore’ despite IP concerns

But in less than 24 hours after his return to China, the employee disappeared. “He did not even wait for a week!” Correa said.

This example illustrates the formal and informal forced transfer of know-how and stealing of intellectual property that have become ‘hot issues’ in the relationship between China on the one side, and the US and Europe on the other.

During the opening ceremony of the CIIE, the Chinese government’s initiative to uphold rules-based international trade, Chinese president Xi Jinping said that “we will enhance the credibility of our Intellectual Property framework”.

To that end, he said, the country would put in place “a punitive compensation system to increase the costs for offenders.

The Chinese leadership took advantage of the Expo to show its willingness to improve Intellectual Property Rights complaints. 

The government made special arrangements to protect the IPR of goods and services displayed at CIIE. Among others, the organisers set up information and dispute settlement offices on site to mediate in conflicts.

“In our view, these are signs of commitment to honour the pledges President Xi Jinping made during the Boao forum to protect IPRs and align China’s practices with International economic an trading rules,” Ernst & Young consultancy said in a report published on Wednesday.

European and US companies attending the CIIE confirmed they were suffering the consequences of these practices. “Problems exist,” said a member of a multinational company who was reluctant, like many others, to speak on the record given how “sensitive” the issue is.

Despite the stealing of companies’ best secrets, or the difficulties of operating in the Chinese market, half a dozen firms consulted stressed the importance of remaining in China.