On November 1, 2018, U.S. Attorney General Jeff Sessions announced the creation of a “China Initiative” aimed at identifying priority Chinese trade theft cases for investigation and enforcement. In prepared remarks, Sessions emphasized that “This theft is not just wrong; it poses a grave threat to our national security. And it is unlawful.” The new initiative comes after several high-profile investigations of Chinese enterprises and citizens concerning espionage and theft of key U.S. technologies and intellectual property. It would also appear that this new action directed at China is yet another approach President Trump and his administration are taking in an effort to address what it views as China’s unfair intellectual property and technology transfer policies and practices.
The new China Initiative will be led by Assistant Attorney General John Demers, who currently leads the Department of Justice’s (DOJ) National Security Division, and will include cross-functional support from various U.S. Attorneys and members of the Federal Bureau of Investigation. In a published fact sheet, Sessions established several goals for the initiative, including:
- Identify priority trade secret theft cases, ensure that investigations are adequately resourced and work to bring them to fruition in a timely manner and according to the facts and applicable law;
- Develop an enforcement strategy concerning non-traditional collectors (e.g., researchers in labs, universities and the defense industrial base) that are being coopted into transferring technology contrary to U.S. interests;
- Apply the Foreign Agents Registration Act (FARA) to unregistered agents seeking to advance China’s political agenda, bringing enforcement actions when appropriate;
- Equip U.S. Attorneys with intelligence and materials they can use to raise awareness of these threats within their districts;
- Implement the Foreign Investment Risk Review Modernization Act (FIRRMA) for DOJ (related to national security reviews of certain foreign direct investment in U.S. companies holding critical technology);
- Identify opportunities to better address supply chain threats, especially ones impacting the telecommunications sector, prior to the transition to 5G networks;
- Identify Foreign Corrupt Practices Act (FCPA) cases involving Chinese companies that compete with U.S. businesses;
- Increase efforts to improve Chinese responses to requests under the Mutual Legal Assistance Agreement (MLAA) with the United States; and
- Evaluate whether additional legislative and administrative authorities are required to protect our national assets from foreign economic aggression.
In concluding his remarks, Sessions stated, “We will not allow our sovereignty to be disrespected, our intellectual property to be stolen, or our people to be robbed of their hard-earned prosperity. We want fair trade and good relationships based on honest dealing. We will enforce our laws—and we will protect America’s national interests.”