Navigating the Waters of Tradee Secrett Protectionn in Chinaa

Abstract

In 2013, the U.S. economy experienced an estimated $300 billion in losses from trade secret misappropriation. This value may understate the problem, as many U.S. companies don’t report the misappropriation of their trade secrets, either because they fear damaging their reputation, they worry about crippling their business relationships, or they don’t even recognize any misappropriation occurred until years later. ​As a result, the problem of ​trade​ ​secret misappropriation​ is becoming worse each year. In 2009 alone, ​U.S. companies engaging in business within China reported losses of approximately $48.2 billion in sales, royalties, or licensing fees alone due to intellectual property infringements. ​Two years later, the Office of the ​National​ Counterintelligence Executive (ONCIX) reported that more “​economic​ espionage”, including ​trade​ ​secret​ ​misappropriation​, occurs in China than anywhere else in the world. China’s problem has not been its ability to ratify treaties or to pass ​laws​ respecting ​intellectual property​ ​rights​, but its willingness and capacity to enforce these obligations. In this paper, we will explore the scope of ​trade​ ​secret​ ​misappropriation​ in China and what can be done about the problem. We will explore how ​intellectual​ ​property​ ​rights​ have developed in modern China. In addition, we will discuss what current challenges ​international business owners face when trying to seek remedies for ​trade​ ​secret​ ​misappropriation​ in China. And last, we will highlight recent ​reforms​ and how business owners can help take steps to prevent ​misappropriation​ from occurring in the first place. It is important to note that the paper discusses The People’s Republic of China only. Hong Kong and Macau have their own ​laws​ and policies for protecting ​trade​ ​secrets.