2020 Report to Congress On China’s WTO Compliance

2020 Report to Congress On China's WTO Compliance

United States Trade Representative January 2021

2020 Report to Congress On China's WTO Compliance

United States Trade Representative January 2021

2020 USTR Report to Congress on China's WTO Compliance

TABLE OF CONTENTS

FOREWORD .................................................................................................................................................... 1

EXECUTIVE SUMMARY .................................................................................................................................. 2

U.S. ASSESSMENT OF CHINA'S WTO MEMBERSHIP ..................................................................... 4

China's WTO Accession ................................................................................................................................... 4 Expectations of WTO Membership .................................................................................................................. 5 China's Record in Terms of Complying With WTO Rules ................................................................................ 6 China's Record in Terms of Transitioning to a Market Economy .................................................................. 8

U.S. STRATEGY FOR ADDRESSING TRADE DISTORTIONS CAUSED BY CHINA ............... 13

REVIEW OF TRADE MECHANISMS USED TO ENGAGE CHINA .............................................. 21

Bilateral Dialogues ................................................................................................................................................. 21 Multilateral Fora ..................................................................................................................................................... 22 Enforcement ............................................................................................................................................................. 24

U.S. Laws .......................................................................................................................................................... 24 WTO Litigation ................................................................................................................................................ 24

KEY U.S. CONCERNS ....................................................................................................................................... 27

Non-tariff Measures ............................................................................................................................................. 27 Industrial Plans ............................................................................................................................................. 27 State-Owned Enterprises .............................................................................................................................. 29 Industrial Subsidies ...................................................................................................................................... 30 Fisheries Subsidies ...................................................................................................................................... 31 Excess Capacity ............................................................................................................................................. 31 Indigenous Innovation .............................................................................................................................. 32 Technology Transfer ..................................................................................................................................... 33 Investment Restrictions .............................................................................................................................. 34 Administrative Licensing .............................................................................................................................. 34 Standards ..................................................................................................................................................... 35 Secure and Controllable Policies .............................................................................................................. 36 Encryption ..................................................................................................................................................... 37 Competition Policy ....................................................................................................................................... 37 Pharmaceuticals ............................................................................................................................................. 38 Medical Devices ............................................................................................................................................. 40 Cosmetics ..................................................................................................................................................... 40 Export Restraints ...................................................................................................................................... 42 Value-added Tax Rebates and Related Policies ....................................................................................... 42 Import Ban on Remanufactured Products .............................................................................................. 42 Import Ban on Recyclable Materials ...................................................................................................... 43

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