- addition to the work described above, the United States anticipates engaging with its trading partners in trade-related initiatives such as the U.S.-EU Summit, in the G-8, and in the Asia Pacific Economic Cooperation (APEC), Organization for Economic Cooperation and Development (OECD) and other multilateral and regional fora.
Trade Secrets and Forced Technology Transfer
This year's Special 301 Report reflects increased emphasis on the need to protect trade secrets. Companies in a wide variety of industry sectors – including information and communication technologies, services, biopharmaceuticals, manufacturing, and environmental technologies – rely on the ability to protect their trade secrets and other proprietary information. Indeed, trade secrets are often among a company's core business assets, and a company's competitiveness may depend on its capacity to protect such assets.
The theft of trade secrets and other forms of economic espionage, which results in significant costs to U.S. companies and threatens the economic security of the United States, appears to be escalating. If a company's trade secrets are stolen, its past investments in research and development, and its future profits, may be lost. Moreover, trade secret theft threatens national security and the U.S. economy, diminishes U.S. prospects around the globe, and puts American jobs at risk.
For these reasons, the United States is concerned by the apparent growth of trade secret theft, particularly in China. Thefts may arise in a variety of circumstances, including those involving departing employees, failed joint ventures, cyber intrusion and hacking, and misuse of information submitted to government entities for purposes of complying with regulatory obligations. In practice, remedies under Chinese law are difficult to obtain. The U.S. National Counterintelligence Executive has stated that "Chinese actors are the world's most active and persistent perpetrators of economic espionage." Public reports, such as a recent report published by the independent information security firm Mandiant have further indicated that actors affiliated with the Chinese military and Chinese Government have systematically infiltrated the computer systems of over one hundred U.S. companies and stolen hundreds of terabytes of data, including all forms of trade secrets, such as proprietary technology, manufacturing processes, and confidential business information.
The United States urges its trading partners to ensure that they have robust systems for protecting trade secrets, including deterrent penalties for criminal trade secret theft. USTR will monitor developments in this area. For example, a notable positive development was Taiwan's amendment of its Trade Secrets Act, effective in February 2013, to increase criminal and civil penalties for corporate IP theft, including enhanced sanctions of up to 10 years imprisonment for trade secrets stolen and transferred to other countries. The United States welcomes Taiwan's positive action on this important issue.
On February 20, 2013, the U.S. Intellectual Property Enforcement Coordinator issued the Administration Strategy on Mitigating the Theft of U.S. Trade Secrets. The Strategy highlights U.S. efforts to combat the theft of trade secrets that could be used by foreign governments or
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