News / Asia

US Businesses Concerned about Investment Restrictions, IP Rights in China

TEXT SIZE - +
William Ide

The head of a coalition of American businesses operating in China says investment restrictions and concerns over intellectual property rights are key issues for companies doing business there.  

When John Frisbie, president of the U.S.-China Business Council, accompanied more than a dozen top American CEOs to China earlier this month, Chinese restrictions on foreign investment was a major issue for both sides. "I think the investment area is one that is highly important for both economies and that reducing investment barriers, again there's a lot on their side; there's probably some things that could be done here, reducing investment barriers would probably help both economies because more direct investment creates jobs.  No doubt about it," he said.

Speaking with reporters here in Washington this week, Frisbie said its time for China to begin addressing this problem and reduce investment restrictions. "China has a pretty extensive list of industry sectors or particular product areas where foreign investors are limited to having to do a joint venture with a Chinese partner or even in some cases hold a minority share in a joint venture with a Chinese partner," he said.

Under such arrangements, U.S. companies worry that they will be forced to transfer technology and sensitive information to their Chinese partners.

Frisbie says that in addition to investment, intellectual property rights and equal treatment were among other key issues American business leaders urged China to address.

He says that although U.S. companies say a nine-month anti-piracy campaign launched by Beijing late last year was helpful, a permanent and tougher effort is needed.  "Basically, adopt the international standard on criminal penalties as a tougher deterrent, criminal penalties in cases of commercial scale.  China hasn't done that yet," he said.

American business leaders say they hope to see substantive progress on these and other issues when U.S. and Chinese officials hold their latest round of U.S.-China Joint Commission on Commerce and Trade talks in Chengdu, China next week.

The U.S.-China Business Council has more than 200 members, and includes major American corporations as well as smaller businesses such as law firms and consultants.  According to a recent survey of its members, foreign investment restrictions and intellectual property rights were among the top 10 concerns of U.S. businesses in China.

John Frisbie says that although some of the challenges American companies face involve Chinese government policies, others are not. "Pretty consistently, the top issue is HR [human resources], the ability to hire people in the environment and keep them, where there're a lot of companies, including Chinese companies chasing the same talent, the turnover pressures that creates for companies the comp [compensation] and ben [benefits] pressures that creates for companies.  If you're trying to run a business in China, that's probably your top headache," he said.

Another issue that limits a company's ability to expand in China, Frisbie says, is the myriad of licenses businesses need and the problems they face in receiving those licenses in a fair and timely manner.

He says the rising cost of labor, materials, land, utilities and taxes are also among the biggest concerns for American companies doing business there. "Each year, we ask companies to rate how any particular issue has faired over the last 12 months; you know, better, worse the same.  The one that was at the top of the list for deterioration over the past year was cost increases.  It is getting more expensive to do business in China," he said.

But rising costs, Frisbie adds, affects companies in different ways.  Firms that use China as a low-cost manufacturing base might move their operations elsewhere.  Companies whose sole focus is the Chinese market will likely stay.

But according to the  U.S.-China Business Council, most of its members saw double-digit revenue growth in China last year.

You May Like

Multimedia Anti-Keystone XL Protests Continue

Demonstrators are worried about pipeline's effect on climate change, their traditional way of life, health and safety More

Thailand's Political Power Struggle Continues

Court gave Prime Minister Yingluck Shinawatra until May 2 to prepare her defense over abuse of power charges but uncertainty remains over election timing More

Malaysia Plane Search Tests Limits of Ocean Mapping Technology

Expert tells VOA existing equipment’s maximum operating depth is around 6 kilometers as operation continues on ocean bed for any trace of MH370 More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Pet Kangaroo Helps Spread Environmental Messagei
X
Penelope Poulou
April 22, 2014 5:53 PM
Children’s author Julia Heckathorn travels the world to learn about different ecosystems and endangered animals. She pours her knowledge into children’s books, hoping the next generation will right the environmental wrongs of our times. As in many children's books, the main character in Heckathorn's stories is an animal. Unlike those other characters, though, this one is real - a kangaroo, that lives in the author’s backyard. VOA’s Penelope Poulou has more.
Video

Video Pet Kangaroo Helps Spread Environmental Message

Children’s author Julia Heckathorn travels the world to learn about different ecosystems and endangered animals. She pours her knowledge into children’s books, hoping the next generation will right the environmental wrongs of our times. As in many children's books, the main character in Heckathorn's stories is an animal. Unlike those other characters, though, this one is real - a kangaroo, that lives in the author’s backyard. VOA’s Penelope Poulou has more.
Video

Video Pro-Russian Separatists Plan 'Federalization Referendum' in Eastern Ukraine

Pro-Russian separatists in eastern Ukraine say they plan to move forward next month with a referendum vote for greater autonomy, despite the Geneva agreement reached with Russia, the U.S. and Ukraine to end the political conflict. VOA's Brian Padden reports from the city of Donetsk in Eastern Ukraine.
Video

Video Pope Francis Hopes Dual Canonizations Will Reconcile Church

On April 27, two popes - John the XXIII and John Paul II - will be made saints in a ceremony at St. Peter’s Square. VOA religion correspondent Jerome Socolovsky says the dual canonization is part of the current pope’s program to reconcile liberals and conservatives in the Roman Catholic Church.
Video

Video In Capturing Nature's Majesty, Film Makes Case for Its Survival

French filmmaker Luc Jacquet won worldwide acclaim for his 2005 Academy Award-winning documentary "March of the Penguins". Now Jacquet is back with a new film that takes movie-goers deep into the heart of a tropical rainforest - not only to celebrate its grandeur, but to make the case for its survival. VOA's Rosanne Skirble reports.
Video

Video Boston Marathon Bittersweet for Many Runners

Monday's running of the Boston Marathon was bittersweet for many of the 36,000 participants as they finished the run that was interrupted by a double bombing last year. Many gathered along the route paid respect to the four people killed as a result of two bombings near the finish line. VOA's Carolyn Presutti returned to Boston this year to follow two runners, forever changed because of the crimes.
Video

Video International Students Learn Film Production in World's Movie Capital

Hollywood - which is part of Los Angeles - is the movie capital of the world, and many aspiring filmmakers go there in hopes of breaking into the movie business. Mike O'Sullivan reports that regional universities are also a magnet for students who hope to become producers or directors.
Video

Video Pacific Rim Trade Deal Proves Elusive

With the U.S.-led war in Iraq ended and American military involvement in Afghanistan winding down, President Barack Obama has sought to pivot the country's foreign policy focus towards Asia. One aspect of that pivot is the negotiation of a free-trade agreement among 12 Pacific Rim nations. But as Obama leaves this week on a trip to four Asian countries he has found it very difficult to complete the trade pact. VOA's Ken Bredemeier has more from Washington.
Video

Video Autistic Adults Face Housing, Job Challenges

Many parents of children with disabilities fear for the future of their adult child. It can be difficult to find services to help adults with disabilities - physical, mental or emotional - find work or live on their own. The mother of an autistic boy set up a foundation to advocate for the estimated 1.2 million American adults with autism, a developmental disorder that causes communication difficulties and often social difficulties. VOA's Faiza Elmasry reports.
AppleAndroid