When China joined the World Trade Organization (WTO) in 2001, it made a wide range of commitments to protect intellectual property and to treat foreign companies the same as indigenous Chinese companies. Some WTO members, principally the United States (U.S.), have accused China of violating its commitments in order to advance its own technological development. Although much has been written about China’s potential violations of various types of intellectual property rights, including patents, trademarks, and copyrights, this Note focuses on China’s potential violation of trade secret and know-how aspects of intellectual property rights.

The United States, in its Section 301 report and the 2017 United States Trade Representative (USTR) Report to Congress on China’s WTO Compliance, makes several complaints against China. They allege that China forces foreign companies to transfer technology to Chinese companies, for example, as a condition for granting a joint venture agreement; that the Chinese government gives more favorable treatment to Chinese companies than to foreign companies in certain circumstances; that China is using outbound investment to acquire foreign technology; and that China engages in cyber intrusions to steal intellectual property from U.S. companies in order to benefit Chinese companies.

This Note analyzes potential WTO claims against China based on these allegations, as well as possible defenses that China could raise, and finds that there are several possible claims that could be brought against China that are likely to succeed. The Note concludes by analyzing Professor Jennifer Hillman’s statements that bringing a WTO case against China would accomplish more than unilateral action by the United States because a WTO case would be more likely to bring about comprehensive fundamental reform in China and restore confidence in the WTO. This Note finds that a WTO case would likely increase confidence in the WTO, but that the United States would likely have to accept partial reform from China, because bringing China into full compliance with its commitments would require China to fundamentally reform the basic structure of its government, which is extremely unlikely to happen. However, partial reform is better than no reform. With China in the WTO, there is at least a mechanism for holding China accountable, which would not exist if China was no longer a member. In the end, this partial reform may be the best outcome that can be expected.

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