The Motor & Equipment Manufacturers Association (MEMA) recently voiced its support for President Donald Trump’s proposed investigation of Chinese trade policies on intellectual property.
Trump signed an executive order Monday instructing U.S. Trade Representative Robert Lighthizer to determine whether an investigation is warranted under Section 301 of the 1974 Trade Act.
The act allows a president to impose trade restrictions or tariffs if he believes the United States has been the victim of unfair trade practices.
An investigation would focus on trade policies that forces foreign companies to form partnerships with Chinese companies and share intellectual property in exchange for having access to the Chinese market.
“The value and strength of a brand is also what makes it vulnerable to counterfeiters,” MEMA said. “Counterfeit goods from China are an ongoing challenge for motor-vehicle parts manufacturers. China is a manufacturing hub that acts as an important source of imports, with many MEMA member companies maintaining a presence in China and working with Chinese government agencies to coordinate efforts to fight counterfeit goods.”
Intellectual theft has cost the United States as much as $600 billion, the Trump Administration said.
It could take up to a year to complete a report, the results of which could lead to trade sanctions with or without World Trade Organization intervention.