The ongoing theft of intellectual property from US firms in China by the CCP: Insights from Ambassador Burns
In a recent interview on CBS News’s “60 Minutes,” US Ambassador to China Nicholas Burns shed light on the challenges faced by American firms operating in China, particularly the issue of intellectual property (IP) protection. According to Ambassador Burns, IP theft continues to be a concern for American companies in China, with every American company fearing such theft.
The Chinese Communist Party (CCP) has long been involved in stealing IPs and trade secrets from companies and institutions as part of its plan to transform China into a technology and IP powerhouse. A report published by the Office of the US Trade Representative in 2018 estimated that Chinese theft of American IP costs between $225 billion and $600 billion annually.
The American Chamber of Commerce in China also highlighted IP challenges in its latest annual business climate report. Cybertheft and IP theft by employees were identified as major concerns for its members in 2023. Additionally, inadequate protection offered by IP-related laws and regulations in China, difficulties in prosecuting IP infringements, and expectations of technology transfer arrangements posed further challenges.
Concerns regarding IP theft have not been limited to the United States alone. Intelligence chiefs from the Five Eyes intelligence-sharing alliance, which includes Australia, Canada, New Zealand, the UK, and the US, jointly warned about the CCP’s IP theft in October of last year.
Ambassador Burns also discussed the Chinese authorities’ raids on consultancy and due diligence companies during an anti-spy crackdown last year. He highlighted Beijing’s implementation of a revised counter-espionage law on July 1, 2022. The broad language used in the amended law raises concerns that American businesspeople could be accused of espionage for engaging in activities that are legal and acceptable elsewhere in the world.
The ambassador further emphasized the significance of the US-China competition, stating that it is the most important and dangerous relationship the United States currently has. He compared the current situation to the Cold War but highlighted that China is a far stronger competitor than the Soviet Union was in the past. This competition, according to Ambassador Burns, is a battle of ideas between America’s belief in democratic society and human freedom versus China’s belief in the strength of a communist state.
New technologies such as artificial intelligence (AI) are driving the military race between the two nations. Ambassador Burns noted that American companies and tech experts are competing in AI, biotech, and quantum mathematics, which will lead to advancements in military technology. The Indo-Pacific region is seen as a crucial strategic area where the two militaries are vying for supremacy.
Ultimately, China’s goal is to replace the United States as the dominant global power. Ambassador Burns made it clear that the US does not want this to happen, as it believes in the superiority of American ideas and democratic values.
The insights provided by Ambassador Burns shed light on the ongoing issue of intellectual property theft faced by American companies operating in China. The concerns raised by the American Chamber of Commerce and the Five Eyes intelligence-sharing alliance further highlight the gravity of the situation. As the US-China competition continues to intensify, it is crucial for American firms to address these IP challenges and find ways to protect their valuable intellectual property rights in order to maintain their competitiveness in the global market.
