The U.S. International Trade Commission (USITC) recently upheld a decision that found U.S. industry was not harmed by Chinese manufacturers’ infringement of American patents for mobile device displays. In response, the Information Technology and Innovation Foundation (ITIF) released a statement from its president, Robert D. Atkinson.
Atkinson stated: “The USITC’s ruling in this case is disappointing, but sadly, it is not surprising given the law’s outdated parameters. Congress should expand Section 337 of the 1930 Tariff Act to better address unfair trade practices that China uses to capture market share in advanced industries at America’s expense.”
Section 337 gives the USITC authority to block imports if domestic industries are hurt by unfair competition. Atkinson emphasized ongoing challenges faced by U.S. industries in sectors targeted by China, pointing out issues such as intellectual property theft and broader concerns over industrial policy.
“There is no doubt that U.S. industries face unfair competition in the advanced industries that China has targeted with its state-orchestrated campaign of innovation mercantilism. Rampant intellectual property theft has been an integral component of China’s strategy to dominate these industries. USITC should be flexible enough in its findings of harm to recognize that context. To find that Chinese manufacturers are infringing U.S. patents and yet somehow not harming U.S. industry is to miss the forest for the trees,” Atkinson said.
He also noted that while the current case involves mobile display technology, the implications are wider, touching on key sectors critical for economic and national security interests.
“The case at hand happens to be about mobile display technology, but the stakes are much broader. America is engaged in an epochal techno-economic battle with China in a wide range of advanced industries that are strategically important for both economic and national security. Existing strategies to counter China’s industrial predation in these sectors are proving to be ineffective,” he said.
Atkinson called for reforms to Section 337: “Reforming Section 337 can change the game by making IP theft and other unfair trade practices less profitable: When China violates global rules or norms to benefit particular firms, they should be denied access to the U.S. market.”
He referenced previous ITIF commentary on strengthening USITC enforcement powers against unfair trade practices.