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 Congress should ask U.S. trade officials to report on whether they
had power to sanction companies that benefited from stealing trade
secrets, the U.S.-China Economic and Security Review Commission said
in its annual report to Congress.
"If authorities do not exist, they should provide a proposal to
address such problems," said the commission, a bipartisan advisory
body that monitors economic and security relations between the
United States and China.
The United States accused five Chinese military officers in May of
hacking into American companies to steal trade secrets.
Prosecutors said the suspects targeted companies including Alcoa Inc
<AA.N>, Allegheny Technologies Inc <ATI.N>, United States Steel Corp
<X.N>, Toshiba Corp <6502.T> unit Westinghouse Electric Co and the
U.S. arm of solar manufacturer SolarWorld AG <SWVKk.DE>, some of
which had filed unfair trade claims against Chinese rivals.
The leaders of the commission said hacking from China was
continuing. "It remains unabated," commission Chairman William Shea
told a news conference previewing the massive report.
There were actions companies could take, like setting up fake
information accounts to divert hackers' attention, he said, but for
most the benefits of doing business in China outweighed the cost of
hacking.
The report said Chinese companies benefited from a host of unfair
trade practices, including subsidies and limits on foreign
investment, that violated at least the spirit of Beijing's World
Trade Organization commitments and contributed indirectly to a loss
of U.S. manufacturing jobs.
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The commission also pointed out a worrying increase in U.S. imports
of pharmaceuticals and pharmaceutical ingredients from China, given
the prevalence of "fake and substandard" drugs.
Although the U.S. Food and Drug Administration was expanding its
team of China-based drug inspectors, slow action on visa
applications meant there were currently only two full-time and
one-part-time FDA inspectors for China’s entire drug industry,
commission Vice Chairman Bill Reinsch said.
(The story corrects fifth paragraph to show that not all victims had
filed trade cases.)
(Reporting by Krista Hughes and Patricia Zengerle; Editing by Lisa
Von Ahn)
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