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Article: China’s Free Trade Agreement Approach to Intellectual Property: The Future of China’s Rules under the Belt and Road Initiative

An article co-authored by Herbert Smith Freehills China International Business and Economic Law (CIBEL) Centre’s Co-director Associate Professor Heng Wang and CIBEL PhD student Zhenyu Xiao has been published in the Law Science, Volume 2019 Issue 2.

Intellectual Property (IP) rules have played an increasingly important role in international trade. The challenges in WTO multilateral negotiations and the reinvigoration of regionalism accelerate the development of various free trade agreements (FTAs) including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). The FTA models developed by major advanced economies such as the US and the EU may profoundly shape the future of IP law globally.

Using a comparative methodology, the article “China’s Free Trade Agreement Approach to Intellectual Property: The Future of China’s Rules under the Belt and Road Initiative” analysed Chinese, the US and the EU’s approaches to IP rules under their FTAs and if China will develop its own FTA model on IP. The article also explores how to resolve potential IP problems between China and other countries under the Belt and Road Initiative.

The authors found that both the US and the EU have developed their FTA models, which featured WTO-plus obligations and stringent enforcement. They largely converged despite differences in areas such as geographical indications. On the other hand, China has not developed its own FTA model on IP. Instead, it largely followed the WTO norms.

“On one hand, China has few rules beyond the WTO’s Agreement on Trade-Related Aspects of Intellectual Property Rights and other international treaties. On the other hand, unlike the US, whose FTAs are often based on its domestic law, China currently does not seek to promote its domestic IP law through its FTAs. Rather, it focuses on the collaboration between parties involved in the FTAs.”

The article finally argued that China may consider developing its own FTA model, but this requires a careful balance between rights protection and public interest, and between legal transplant and rule innovation.

“It should not only focus on the rules themselves, but also on the real questions the rules deal with. This needs more research on how China is likely to be affected by the US and EU’s IP rules in the future and how China may develop or create its own IP rules.”

Associate Professor Heng Wang’s current research focus is on China’s approach to international economic legal order, including the BRI and the possible Central Bank Digital Currency (CBDC). His recent research on China’s Approach to the Belt and Road Initiative and How May China Respond to the U.S. Trade Approach? Retaliatory, Inclusive and Regulatory Responses deal with relevant topics and are in English.

Zhenyu Xiao is a third-year PhD student at CIBEL. Her research focus is on investment treaties and Chinese law. She is currently doing her research on “The Evolution of Settlement of Investor-State Disputes in China: A Coherent and Conscious Approach?” under the supervision of Associate Professor Heng Wang and Dr Jonathan Bonnitcha of UNSW Law.