China establishes new ‘trade secret protection regulations’… Establishment of grounds for sanctions against foreign companies and individuals

"If trade secrets are violated, import/export, investment, and entry are controlled... Investigate whether there is a security threat."

(Beijing = Yonhap News) Correspondent Jeong Seong-jo = The Chinese government has decided to create a new law to regulate 'trade secret infringement' by foreign companies.

On the 26th, China's Ministry of Commerce released the draft of the 'China Special Regulations for Trade Secret Protection' (hereinafter referred to as 'Regulations') on its website and began the process of collecting opinions.

The regulation, which consists of a total of 10 provisions, stipulates that the Chinese government can take action if a 'foreign entity' (foreign company, other organization, or individual) infringes on China's trade secrets in trade or other activities, and at the same time, if there is a harm or realistic threat to China's sovereignty, security, and development interests.

If a foreign entity infringes on China's trade secrets and threatens its sovereignty, security, or development interests, China can take measures such as ▲ restricting or banning the import and export of cargo and technology related to China ▲ restricting or banning investment in China ▲ restricting or banning entry into China ▲ imposing fines.

The regulations also specify that if a foreign entity infringes trade secrets, China's Ministry of Commerce has the authority to investigate whether sovereignty, security, and development interests have been violated, and that if it does not cooperate with the investigation, the Ministry of Commerce can make its own decision.

This move by the Chinese government comes amid a situation in which the United States has recently taken issue with the 'theft of trade secrets' by Chinese companies.

On the 19th, the U.S. State Department sanctioned five Chinese companies involved in the theft of trade secrets related to Google's artificial intelligence (AI) technology.

Then, China's Ministry of Commerce countered that the rapid development of Chinese AI companies was the result of long-term commitment to basic research and continued investment in innovation, and had nothing to do with the theft of trade secrets, and urged the United States to stop slandering and pressuring Chinese companies.