BRUSSELS – At a time of growing misunderstanding with China, the European Commission announced today, Friday 18 February, that it has opened a new dispute with Beijing before the World Trade Organization. In this case, the matter concerns the very delicate field of patent protection in the high-tech sector. In the eyes of many observers, the story confirms the Chinese attempt to defend and strengthen its technological sovereignty.
Brussels accuses the Chinese government of hindering European companies whenever they want to seek justice in European courts when their patents are used illegally or without appropriate compensation. “European companies have the right to seek justice on fair terms when their technology is used illegally,” said European Commission Vice President Valdis Dombrovskis in a statement.
A legal, economic and political affair
According to Brussels, from 2020 the Chinese judiciary has decided to issue orders that prevent European companies from defending their interests in Western courts. In fact, the Chinese courts argue that the final goods are often produced in China and that the jurisdiction therefore lies with the Chinese courts. They use the threat of heavy fines to dissuade European companies from turning to their national judiciary.
They hide behind this trend two goals. The first is cheap. In this way, the Chinese authorities want to try to snatch low rates when, for example, Huawei negotiates the purchase of particular Western technology with a European counterpart. The second goal is more political: China wants to impose new world standards in intellectual property litigation, as well as defend its technological sovereignty.
From a financial point of view, the damage involved is considerable – estimates speak of billions of euros. According to information gathered here in Brussels, the matter has been dealt with bilaterally with Beijing in various circumstances and in various formats, but without success. This is why the European Commission has decided to discuss it in the WTO. If after an initial phase of consultations the nodes remain on the table, the matter will be entrusted to an arbitration.