The Special 301 Report, released by the Office of the United States Trade Representative (USTR) on April 30, 2026, is the product of an annual review conducted pursuant to Section 182 of the Trade Act of 1974, as amended by the Omnibus Trade and Competitiveness Act of 1988 and the Uruguay Round Agreements Act. The Report identifies trading partners whose acts, policies, or practices deny adequate and effective protection of intellectual property rights or deny fair and equitable market access to U.S. persons relying on intellectual property protection. Trading partners are placed into categories reflecting the degree of concern: Priority Foreign Country, Priority Watch List, or Watch List. USTR reviewed over 100 trading partners for the 2026 Report, identifying Vietnam as a Priority Foreign Country for the first time in thirteen years, placing six countries on the Priority Watch List, and placing nineteen countries on the Watch List.
The 2026 Report reflects several notable changes in country placement. Argentina and Mexico were moved from the Priority Watch List to the Watch List based on improvements in IP policy, Bulgaria was removed from the Watch List, and the European Union (EU) was added to the Watch List. The EU’s addition reflects concerns regarding the provisional agreement on the EU General Pharmaceutical Legislation, issues related to geographical indications, and the implementation of legislation affecting digital copyright. Ambassador Jamieson Greer stated that using enforcement tools to address unfair trade practices is a top priority, and Ambassador Rick Switzer indicated that USTR will continue to press trading partners to resolve IP-related trade barriers through negotiations for Agreements on Reciprocal Trade and other engagements.
China remains on the Priority Watch List in 2026 and continues to be subject to monitoring under Section 306 of the Trade Act of 1974. The Report states that the pace of reforms in China aimed at addressing intellectual property protection and enforcement remained slow during 2025. USTR identifies ongoing concerns regarding implementation of China’s amended Criminal Law, Copyright Law, and Patent Law, as well as long-standing issues involving technology transfer, trade secrets, counterfeiting, online piracy, patent and related policies, bad faith trademarks, and geographical indications. The Report notes that statements by Chinese officials tying intellectual property rights to Chinese market dominance, including President Xi’s October 2024 reference to an intellectual property path with “Chinese characteristics,” raise concerns about whether IP protection and enforcement will apply fairly to foreign right holders in China.
On technology transfer, the Report references the October 2025 initiation of a Section 301 investigation to determine whether China has fully implemented its commitments under the United States-China Economic and Trade Agreement (Phase One Agreement), including those related to technology transfer and intellectual property. On trade secrets, the Report identifies continued weak judicial enforcement, incomplete implementation of the amended Criminal Law, and concerns regarding the April 2025 joint interpretation issued by the Supreme People’s Court and Supreme People’s Procuratorate, which requires a showing of actual losses or illegal gains to meet the criminal threshold for trade secret misappropriation. The Report also identifies concerns about potential unauthorized disclosures of trade secrets and confidential business information by government personnel and third-party experts.
The Report identifies China as the world’s leading source of counterfeit and pirated goods, with China and Hong Kong together accounting for over 87% of the value of counterfeit and pirated goods seized by U.S. Customs and Border Protection in Fiscal Year 2025. The Report describes the widespread manufacture, domestic sale, and export of counterfeit goods, including counterfeit medicines, fertilizers, pesticides, and under-regulated pharmaceutical ingredients. Additional areas of concern identified in the Report include the availability of counterfeit goods on e-commerce platforms, online piracy facilitated by mini Video on Demand facilities and illicit streaming devices, restrictions on foreign investment in online publishing and audiovisual services, patent prosecution transparency, standards-setting processes, “secure and controllable” policies affecting information and communications technology products, geographical indications administration, and judicial transparency, including the decreased publication of court decisions over the past five years.
For ease of reference, the China section is reproduced below. The full text is available here (English only).
China remains on the Priority Watch List in 2026 and is subject to continuing monitoring pursuant to Section 306 of the Trade Act of 1974, as amended (19 U.S.C. § 2416).
Ongoing Challenges and Concerns
In 2025, the pace of reforms in China aimed at addressing intellectual property (IP) protection and enforcement remained slow. The United States continues to have concerns about implementation of the amended Criminal Law, Copyright Law, and Patent Law. Concerns remain about longstanding issues, including technology transfer, trade secrets, counterfeiting, online piracy, copyright law, patent and related policies, bad faith trademarks, and geographical indications. China needs to complete the full range of fundamental changes that are required to improve the IP landscape in China.
Statements by Chinese officials that tie IP rights to Chinese market dominance continue to raise strong concerns. In an October 2024 letter to the 2024 International Association for the Protection of Intellectual Property World Congress, President Xi reiterated China’s aspiration to become a global IP powerhouse and noted that China has blazed a path of IP rights development with “Chinese characteristics.” In May 2024, the National Inter-Ministerial Joint Meeting on the Construction of an IP Power issued the “2024 Promotion Plan for the Construction of an IP Power,” which notes the priority of “deeply participating in global IP governance” and directs the Supreme People’s Procuratorate to carry out “prosecution to protect enterprises” in order to serve “technological self-reliance” in key core technologies and emerging industries. During a September 2025 conference hosted by the China National Intellectual Property Administration (CNIPA), China’s lead technology enterprises underscored their role in a centralized effort to promote China’s IP norms and judgments to shape global IP rules, even arguing that Beijing’s judicial and administrative actions should become accepted “world rules.” Such statements recall long-standing concerns about requiring or pressuring technology transfer from foreign individuals or companies to Chinese companies, as well as about whether IP protection and enforcement will apply fairly to foreign right holders in China. China should provide a level playing field for IP protection and enforcement, refrain from requiring or pressuring technology transfer to Chinese companies at all levels of government, open China’s market to foreign investment, and embrace open, market-oriented policies.
Under Section 301 of the Trade Act of 1974, as amended (19 U.S.C. § 2411) (Section 301), the Office of the United States Trade Representative (USTR) has been taking action to address a range of unfair and harmful Chinese acts, policies, and practices related to technology transfer, IP, and innovation. USTR has also successfully pursued dispute settlement proceedings at the World Trade Organization (WTO) to address discriminatory licensing practices. The United States and China signed the United States-China Economic and Trade Agreement (Phase One Agreement) in January 2020, which included commitments to address numerous long-standing concerns in the areas of trade secrets, patents, pharmaceutical-related IP, trademarks, copyrights, geographical indications (GIs), and technology transfer. China has failed to implement or only partially implemented a number of these commitments. The United States continues to closely monitor China’s progress in implementing its commitments under the Phase One Agreement.
China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation
In 2018, USTR reported that its investigation under Section 301 found that China pursues a range of unfair and harmful acts, policies, and practices related to technology transfer, IP, and innovation. These include investment and other regulatory requirements that require or pressure technology transfer, substantial restrictions on technology licensing terms, direction or facilitation of the acquisition of foreign companies and assets by domestic firms to obtain cutting-edge technologies, and conducting and supporting unauthorized intrusions into and theft from computer networks of U.S. companies to obtain unauthorized access to IP.
In March 2018, the United States initiated a WTO case challenging Chinese measures that deny foreign patent holders the ability to enforce their patent rights against a Chinese joint-venture partner after a technology transfer contract ends and that impose mandatory adverse contract terms, which discriminate against, and are less favorable for, imported foreign technology as compared to Chinese technology. Consultations took place in July 2018, and a panel was established to hear the case at the United States’ request in November 2018. In March 2019, China revised certain measures that the United States had challenged in its panel request, including the Regulations on the Administration of Import and Export of Technologies. The United States considered that China’s actions had sufficiently addressed U.S. concerns, and the authority of the panel expired on June 9, 2021.
As part of the Phase One Agreement, China agreed to provide effective access to Chinese markets without requiring or pressuring U.S. persons to transfer their technology to Chinese persons. China also agreed that any transfer or licensing of technology by U.S. persons to Chinese persons must be based on market terms that are voluntary and mutually agreed, and that China would not support or direct the outbound foreign direct investment activities of its persons aimed at acquiring foreign technology with respect to sectors and industries targeted by its industrial plans that create distortion. In addition, China committed to ensuring that any enforcement of laws and regulations with respect to U.S. persons is impartial, fair, transparent, and non-discriminatory. USTR continues to work with stakeholders to evaluate whether these commitments have resulted in changes in China’s ongoing conduct at the national, provincial, and local levels.
In May 2022, USTR launched a statutorily mandated four-year review of the tariffs that had been imposed on Chinese imports as a result of the Section 301 investigation into China’s unfair acts, policies, and practices related to technology transfer, intellectual property, and innovation. As part of this review, USTR examined the effectiveness of the tariff actions in achieving the objectives of the original investigation, other actions that could be taken, and the effects of those actions on the United States economy, including consumers. In May 2024, USTR issued a report that found that China’s unfair acts, policies, and practices had continued and, in some cases, had worsened.
In October 2025, USTR initiated a Section 301 investigation to determine whether the rights of the United States under the Phase One Agreement are being denied or an act, policy, or practice of China violates or is inconsistent with the provisions of, or otherwise denies benefits to the United States under, the Phase One Agreement. USTR will examine whether China has fully implemented its commitments under the Agreement, including those related to technology transfer and intellectual property, and what action, if any, should be taken in response.
Trade Secrets
Stakeholders report that the Chinese judicial system’s enforcement of trade secret protections continues to be weak, and implementation of the amended Criminal Law remains incomplete. On April 24, 2025, the Supreme People’s Court (SPC) and Supreme People’s Procuratorate (SPP) jointly issued Interpretation of Several Issues Concerning the Application of Laws for Handling Criminal Cases of Infringement upon Intellectual Property Rights, which requires a showing of actual losses or illegal gains to meet the criminal threshold for trade secret misappropriation. Further changes are needed to add “other serious circumstances” as an additional, catch-all category for triggering criminal investigations and prosecutions, and to update a related standard issued by the SPC and Ministry of Public Security. Although China amended the Anti-Unfair Competition Law in June 2025, the amendments did not increase the administrative penalties for trade secret misappropriation. Also, administrative penalties for trade secret misappropriation are no substitute for strengthening criminal enforcement of trade secrets. Moreover, stakeholders continue to identify significant enforcement challenges, including high evidentiary burdens, limited discovery, difficulties meeting stringent conditions to enforce agreements related to protection of trade secrets and confidential business information against theft, and difficulties in obtaining deterrent-level damages awards.
China needs to address concerns regarding the risk of unauthorized disclosures of trade secrets and confidential business information by government personnel and third-party experts, which continue to be a serious concern for the United States and U.S. stakeholders in industries such as software, manufacturing, and cosmetics. The draft Guiding Opinions on Strengthening the Protection of Trade Secrets and Confidential Business Information in Administrative Licensing was published for public comment in August 2020 by the Ministry of Justice but has not been finalized. U.S. stakeholders continue to express concerns about the potential for discriminatory treatment and unauthorized disclosure of their information by local authorities under the proposed expansion of administrative trade secret enforcement. In April 2025, the State Administration of Market Regulation (SAMR) issued draft Regulations on Protection of Trade Secrets, but the provisions include broad, undefined exceptions that could undermine trade secret enforcement.
Manufacturing, Domestic Sale, and Export of Counterfeit Goods
China continues to be the world’s leading source of counterfeit and pirated goods. For example, a 2022 report identified China and Hong Kong as the largest exporters of counterfeit foodstuffs and cosmetics, accounting for approximately 60% of counterfeit foodstuffs customs seizures and 83% of counterfeit cosmetics customs seizures.38 China and Hong Kong, together, accounted for over 87% of the value measured by manufacturers’ suggested retail price of counterfeit and pirated goods seized by U.S. Customs and Border Protection in Fiscal Year 2025.39 Counterfeiting activities have increased as economic conditions have declined within China. The failure to curb the widespread manufacture, domestic sale, and export of counterfeit goods affects not only right holders but also the health and safety of consumers. The production, distribution, and sale of counterfeit medicines, fertilizers, and pesticides, as well as under-regulated pharmaceutical ingredients, remain widespread in China.
Stakeholders continue to express concerns about the production, distribution, and sale of counterfeit medicines and unregulated active pharmaceutical ingredients (APIs), as well as about the Drug Administration Law and Criminal Law, which give local officials substantial discretion in allowing companies that export unapproved drugs to escape liability or face lighter penalties. As the top manufacturer and a leading exporter of pharmaceutical ingredients, China still lacks effective regulatory oversight. In particular, China does not regulate manufacturers that fail to declare an intent to manufacture APIs for medicinal use. It also does not subject exports to regulatory review, enabling many bulk chemical manufacturers to produce and export APIs outside of regulatory controls. Furthermore, China lacks central coordination of enforcement against counterfeit pharmaceutical products and ingredients, resulting in ineffective enforcement at the provincial level and with respect to online sales.
Availability of Counterfeit Goods Online, Online Piracy, and Other Issues
China’s e-commerce markets, the largest in the world, remain a source of widespread counterfeits as infringing sales have migrated from physical to online markets. Right holders also raise concerns about the proliferation of counterfeit sales facilitated by the confluence of e-commerce platforms and social media in China. This trend is now well-established as the popularity of ecommerce has led many sellers to maintain both a physical and online presence, or to shift to online platforms entirely, which offer short-form video, live stream, and e-commerce functionalities that allow sellers of counterfeit goods to evade detection. Right holders continue to report difficulties in receiving information and support from platforms in investigations to uncover the manufacturing and distribution channels of counterfeit goods and sellers, as well as onerous evidentiary requirements and excessive delays in takedowns. Counterfeiters continue to exploit the use of small parcels and minimal warehouse inventories, the separation of counterfeit labels and packaging from products prior to the final sale, and the high volume of packages shipped to the United States to escape enforcement and to minimize the deterrent effect of enforcement activities.
Widespread online piracy also remains a major concern, including in the form of “mini Video on Demand (VOD)” facilities that screen unauthorized audiovisual content, illicit streaming devices (ISDs), and unauthorized copies of or access codes to scientific journal articles and academic texts. As a leading source and exporter of systems that facilitate copyright piracy, China should take sustained action against websites and online platforms containing or facilitating access to unlicensed content, ISDs, and piracy apps that facilitate access to such websites.
There was no progress in 2025 on finalizing amendments to the E-Commerce Law, which were issued by SAMR for public comment in August 2021. The draft amendments to the E-Commerce Law include changes that would extend the deadline for right holders to respond to a counternotification of non-infringement, and impose penalties for fraudulent counter-notifications and penalties that restrict the business activities of platforms for serious circumstances of infringement. Although noting improvements under the draft amendments, right holders have raised concerns about the failure to codify the elimination of liability for erroneous notices submitted in good faith, as well as proposed changes that would allow reinstatement of listings upon posting an ambiguous and poorly defined guarantee.
China’s most recent version of its Foreign Investment Negative List, which entered into force in January 2022, continues to maintain prohibitions on foreign investment in online publishing and online audiovisual programming (with the exception of services under China’s WTO accession commitments), as well as radio and TV broadcasting, transmission, production, and operation. The Foreign Investment Negative List does not restrict foreign investment in online music services.
Also, right holders report significant obstacles to releasing content in China, including limited windows to submit content for review, a non-transparent content review system, and significantly slowed processing and licensing of content for online streaming platforms. Another challenge has been burdensome requirements for documentation of chain of title and ownership information. These barriers have severely limited the availability of foreign content, prevented the simultaneous release of foreign content in China and other markets, and created conditions for greater piracy. Right holders also report that a draft bill published in March 2021 could restrict participation of foreign companies in production, distribution, and broadcasting of radio and television programs, including when provided online. Also, China’s extension of its content review system to cover books intended for distribution in other markets has imposed heavy burdens on foreign publishers.
Additionally, it is critical that China fully implement the terms of the 2012 United States-China Memorandum of Understanding (MOU) regarding the importation and distribution of theatrical films and abide by its commitment to negotiate further meaningful compensation that China owes the United States.
The United States continues to urge all levels of the Chinese government, as well as state-owned enterprises, to use only legitimate, licensed copies of software. The United States also urges the use of third-party audits to ensure accountability, as China committed to provide under the Phase One Agreement.
Patent and Related Policies
Right holders raised concerns that, although the Patent Law allows the filing of supplemental data to support disclosure and patentability requirements, the rules for accepting post-filing data are opaque and patent examiners have applied an overly stringent standard to reject such data. In addition, the China National Intellectual Property Administration’s (CNIPA) administrative Patent Reexamination and Invalidation Department (PRID) and Chinese courts reportedly reject supplemental data based on unduly stringent requirements for acceptance of such data, resultingin potentially improper invalidity decisions. Such decisions can also lead to automatic dismissal of parallel patent infringement proceedings in China’s courts.
Following the implementation of a mechanism for the early resolution of potential pharmaceutical patent disputes in 2021, right holders have expressed concerns about the lack of transparency in decisions issued by CNIPA, the cumbersome registration system, and the lack of any penalties for erroneous patent certification statements. Right holders continue to raise concerns that they had identified prior to implementation, such as regarding the scope of patents and pharmaceuticals covered by the mechanism, the lack of clarity about what could trigger a dispute under the mechanism, potential difficulties in obtaining preliminary injunctions, the length of the stay period, and the possibility of bias in favor of Chinese companies. Stakeholders report that they lack remedies if a follow-on manufacturer submits an erroneous declaration that prevents a patent owner from using the early resolution mechanism, while the manufacturer concurrently seeks to invalidate that same patent at CNIPA’s PRID. Stakeholders also report that a follow-on manufacturer is allowed to submit a patent certification statement claiming that a patent is invalidated, even if the CNIPA invalidation decision is still under judicial review.
In January 2024, the Implementing Regulations of the Patent Law entered into force. CNIPA also issued supporting documents, such as amended Patent Examination Guidelines. Right holders continue to express concern about the implementation of patent term extensions for unreasonable marketing approval delays, including the definition of “new” drugs covered by the system, scope of eligible patents, and limits on the type of protection provided.
Obstacles to patent enforcement continue to include lengthy delays in the court system, the reported unwillingness of courts to issue preliminary injunctions, an undue emphasis on administrative enforcement, burdensome invalidity proceedings, onerous evidentiary requirements, and ambiguity about whether a patentee’s right to exclude extends to manufacturing for export.
With respect to patent prosecution, right holders continue to express concerns about the lack of transparency and due process, including a lack of notice of third-party submissions or the opportunity to respond, despite the reliance of examiners on arguments from such submissions. Long-standing concerns also include a lack of harmonization between China’s patent grace period and international practices.
Stakeholders continue to express concern regarding the 2019 Human Genetic Resources Administrative Regulation and the 2020 Biosecurity Law, along with the Implementing Rules for the Regulations on the Management of Human Genetic Resources that entered into effect in May 2023. These measures mandate collaboration with a Chinese partner and shared ownership of patent rights arising out of any research generated by using human genetic resource materials in China. According to stakeholders, these measures create uncertainty about the type of research that would trigger the sharing of IP rights, a need for greater clarity on the requirements for approved IP arrangements, and the risk of being pressured to transfer technology to Chinese companies. These measures also impose non-transparent requirements for government approval before any transfer of data outside of China. Right holders continue to raise concerns about the lack of transparency in government pricing and reimbursement processes for pharmaceutical products.
With respect to standards, China should establish standards-setting processes that are open to domestic and foreign participants on a non-discriminatory basis, eliminate unreasonable public disclosure obligations in standards-setting processes, and provide sufficient protections for standards-related copyrights and patent rights.
The issuance of anti-suit injunctions by Chinese courts in standard essential patent (SEP) disputes has not occurred in recent years, but the issue continues to raise due process and transparency concerns for right holders, including regarding how such rulings may favor domestic companies over foreign patent holders. High-level political and judicial authorities in China have called for extending the jurisdiction of China’s courts over global IP litigation and have cited the issuance of an anti-suit injunction as an example of the court “serving” the “overall work” of the Chinese Communist Party and the Chinese State. Moreover, Chinese courts appear increasingly interested in exercising jurisdiction in cases involving SEPs, raising concerns that China seeks to establish itself as the forum for SEP litigation in order to favor domestic companies.
The National People’s Congress (NPC) passed amendments to the Anti-Monopoly Law (AML), which entered into effect in August 2022. Right holders have raised concerns about the implementation of the amended AML, particularly regarding the draft implementing rules that define anti-competitive behavior in the development of standards and the licensing and implementation of SEPs. Right holders stated concerns that AML enforcement can be misused for the purpose of depressing the value of foreign-owned IP in key technologies, including by finding violations of the law with respect to the licensing of patents without actual harm to competition or the competitive process.
In November 2024, SAMR released the final version of the Anti-Monopoly Guidelines in the Field of Standard Essential Patents. Stakeholders have raised concerns about the potential misuse of anti-monopoly enforcement to favor domestic companies, especially in cases involving complex technologies.
It is critical that China’s AML enforcement be fair, transparent, and non-discriminatory; afford due process to parties; focus on whether there is harm to competition or the competitive process, consistent with the legitimate goals of competition law; and implement appropriate competition remedies to address the competitive harms. China should not use competition law to advance noncompetition goals.
China’s “Secure and Controllable” Policies
China continues to build on its policies for “secure and controllable” information and communications technology (ICT) products under the Cybersecurity Law (CSL) and the Cryptography Law. In 2022, the Cyberspace Administration of China issued final implementing measures for conducting cybersecurity reviews under the CSL. Right holders continue to raise concerns about the invocation of cybersecurity as a pretext to require disclosure of trade secrets and other types of IP and to restrict market access. Furthermore, encryption laws, which impose mandatory approval requirements with unclear exemptions, create an uncertain business environment for foreign companies.
U.S. right holders should not be forced to choose between protecting their IP against unwarranted disclosure and competing for sales in China. Going forward, China must not invoke security concerns in order to erect market access barriers, require the disclosure of critical IP, or discriminate against foreign-owned or -developed IP.
Industrial Designs
In 2022, China acceded to the Hague Agreement Concerning the International Registration of Industrial Designs. As a positive development, the Implementing Regulations of the Patent Law, which entered into force in January 2024, clarified the connection between international design application procedures and domestic procedures.
Geographical Indications
In January 2024, China finalized the Measures for Protection of Geographical Indication Products. The new measures fail to require the identification of individual components of multicomponent terms that are being considered for GI protection when GI applications that contain multi-component terms are published for opposition. Without this information, interested parties may assume that all individual components of multi-component terms in an application for GI protection will also be protected as GIs, which imposes onerous burdens on parties seeking to oppose such applications. In addition, right holders continue to raise concerns about certain trademark examination cases that involve the use of common names. CNIPA released an Implementation Plan for the Geographical Indication Protection Project in January 2024 to promote the development of China’s GIs. It is critical that China ensure full transparency and due process with respect to the protection of GIs, including safeguards for common names, respect for prior trademark rights, clear procedures to allow for opposition and cancellation, and fair market access for U.S. exports to China that rely on trademarks or the use of common names.
Legislative, Administrative, and Judicial Issues
A long-standing concern has been that Chinese courts publish only selected decisions rather than all preliminary injunctions and final decisions. Moreover, the number of verdicts uploaded online has consistently decreased over the past five years, further hampering transparency and making it more difficult for right holders to determine how China protects and enforces foreign IP. In January 2024, the SPC admitted to the decrease in case publications and announced the launch of a National Court Judgments Database. Initial details shared in December 2023 indicated the database would not be available to the public, and the SPC has yet to clarify the extent to which case decisions will be accessible to the general public or foreign firms. Additional concerns include interventions in judicial proceedings by local government officials, party officials, and powerful local interests that undermine the authority of China’s judiciary and rule of law. In January 2024, amendments to the Civil Procedure Law entered into effect that expanded the jurisdiction of Chinese courts in cases involving foreign parties. A judiciary truly independent from the Communist Party of China is critical to promote rule of law in China and to protect and enforce IP rights. Right holders also expressed concerns about the increased emphasis on administrative enforcement, as authorities often fail to provide right holders with information regarding the process or results of enforcement actions. The transfer of administrative IP cases for criminal enforcement remains uneven, as administrative authorities may be reluctant to transfer cases where they can collect large fines and criminal enforcement authorities reportedly lack the budget for warehousing counterfeits and investigations.
China has taken steps to develop “social credit” systems for IP that punish infringers through the use of social credit penalties, such as addition to a blacklist and potential joint punishment by a wide range of agencies. These measures lack critical procedural safeguards, such as sufficient notice to the entity targeted for punishment, clear factors for determinations, and opportunities for appeal. The United States continues to object to any use of the “social credit system,” including in the field of IP.
Right holders continue to raise concerns about their ability to meet consularization and notarization requirements for documents submitted to the Beijing Intellectual Property Court and in other IPrelated proceedings. As a positive step, the Convention of 5 October 1961 Abolishing the Requirement of Legalisation for Foreign Public Documents (Apostille Convention) entered into force with respect to China in November 2023. However, in 2025, right holders continue to report inconsistent implementation, including instances where Chinese courts still required burdensome legalization procedures for certain court foreign documents, hampering the efficiency of civil litigation to resolve IP disputes.
Developments, Including Progress and Actions Taken
Legislative, Administrative, and Judicial Developments
In 2025, the NPC and its Standing Committee issued several legislative reforms, including draft amendments to the Trademark Law and Anti-Unfair Competition Law, but these actions continue to fall short of addressing key IP concerns. Despite some positive reports from right holders of courts issuing higher damage awards for IP infringement, insufficient damage awards are still a concern. China also has yet to address right holder concerns with respect to preliminary injunctive relief, evidence production, evidentiary requirements, establishment of actual damages, burdensome thresholds for criminal enforcement, and lack of deterrent-level damages and penalties.
In December 2025, the NPC released a draft amendment to the Trademark Law for public comment. The draft amendment contains some positive changes, including expanded enforcement authority for county-level governments, improved tools to address bad faith trademarks, and greater clarity on registrability, use obligations, and administrative enforcement. However, the draft amendment still falls short of addressing other long-standing concerns, particularly regarding stronger civil remedies and systemic deterrence against repeat bad faith actors.
In June 2025, the NPC issued amendments to the Anti-Unfair Competition Law, which came into effect on October 15, 2025. Despite the positive introduction of new restrictions on using influential third-party brands as search keywords, stronger regulation of fake reviews and malicious online conduct, and increased pressure on platforms to monitor and address IP-related unfair practices, other outstanding concerns were not addressed, such as low penalty ceilings for trade secret misappropriation and the lack of enhanced damages for bad faith violations, among other issues.
The persistent lack of transparency and the potential for political intervention with the judicial system, as well as the continued emphasis on administrative enforcement in China, remain as critical concerns. Adding to these concerns, in March 2025, the State Council of China issued the Provisions on the Handling of Foreign-Related Intellectual Property Disputes, a troubling measure that seemingly legitimizes political intervention in IP disputes. This measure authorizes Chinese government agencies to take countermeasures against and impose restrictions on foreign entities that “use intellectual property disputes as an excuse to contain and suppress China” and also to “take discriminatory restrictive measures against Chinese citizens or organizations.” The measure further prohibits any organization or individual from implementing or assisting in implementing foreign IP enforcement actions deemed “discriminatory restrictive measures,” or else be liable for civil damages. In March 2025, CNIPA released a 2025 Working Plan for IP Administrative Protection that, among other provisions, called for enhanced monitoring and early warning of Section 337 investigations at the U.S. International Trade Commission. In December 2025, China amended the Foreign Trade Law, adding provisions that appear to grant the State Council authority to intervene in IP cases.
Bad Faith Trademarks and Other Trademark Examination Developments
Bad faith trademarks remain one of the most significant challenges for U.S. brand owners in China. Stakeholders noted a shift within CNIPA in 2025 toward stricter examination standards, presumably to combat bad faith trademark filings, but also noted that no official announcements have been made about changes in examination practices. This shift has also reportedly increased the evidentiary burden on legitimate trademark holders and even resulted in preliminary refusals of legitimate trademark applications in the past year.
Stakeholders also continue to express other concerns relating to trademark examination, including regarding unnecessary constraints on examiners’ ability to consider applications and marks across classes of goods and services, as well as the CNIPA Trademark Review and Adjudication Department’s increasing refusal to consider co-existence agreements and letters of consent during the trademark registration or appeal process. They also noted that, in 2025, CNIPA’s Trademark Office continued to erroneously refuse trademark applications on absolute grounds (such as lacking distinctiveness, being deceptive as to product quality or source, and being offensive to socialist morality), which are much more difficult to overcome on appeal and often lead to refusals in future applications for the same trademark. In addition to denying right holders the ability to register their legitimate trademarks, erroneous refusals on absolute grounds significantly impact business operations because, in such cases, the right holder must immediately cease use of the mark even if the product already has launched or face significant potential penalties by administrative enforcement officials. Right holders also continued to report in 2025 that CNIPA is rejecting defensive filings allowed under the Guidelines for Trademark Examination and Trial, denying brand owners a useful proactive tool to defend against bad faith filings.
Stakeholders continue to urge the adoption of reforms to address the difficulties faced by legitimate right holders in obtaining well-known trademark status. The United States urges China to address these concerns from right holders concerning the administration of trademarks.
Patent and Related Developments
China continues to impose unfair and discriminatory conditions on the effective protection against unfair commercial use, as well as unauthorized disclosure, of undisclosed test or other data generated to obtain marketing approval for pharmaceutical products. The United States and China agreed to address this issue in future negotiations. In March 2025, the National Medical Products Administration (NMPA) issued for public comment draft Implementation Measures for Drug Clinical Trial Data Protection and draft Drug Trial Data Protection Procedures, but the draft measures would preclude or condition the duration of protection on whether marketing approval is sought first in China. In January 2026, the State Council issued the Implementing Regulations of the Drug Administration Law, which will take effect in May 2026. The measure provided an upper limit of six years of protection but did not address what period of protection should apply with respect to drugs first approved outside of China.
In December 2025, the SPC issued for public comment a draft Judicial Interpretation (III) on Several Issues Concerning the Application of Law in the Trial of Patent Infringement Disputes. The draft judicial interpretation raises concerns about allowing defendants to relitigate the same prior art issues across multiple forums, creating duplicative proceedings and imposing unnecessary burdens on patent owners.
The large quantities of poor-quality patents that are granted continue to be a concern. Although CNIPA announced in January 2021 the elimination of patent subsidies by 2025, local incentivization mechanisms continue to include subsidies for patent licensing, validity disputes, and litigation that can potentially distort the commercial market for patents.
Copyright Developments
Right holders continue to highlight the need for effective implementation and clarification of criminal liability for the manufacture, distribution, and exportation of circumvention devices, as well as new measures to address online piracy. Stakeholders raised concerns about an increase in the export of pirated content, services, and devices from China in 2025, further contributing to the dissemination and accessibility of infringing content around the world. China has yet to issue a draft or final regulations regarding measures related to the 2021 amendments to the Copyright Law. Right holders continue to report uncertainty about whether these amendments protect sports and other live broadcasts, and recommend clarification in the copyright regulations. While right holders again welcomed some effective, but limited, enforcement actions, such as the annual Sword-Net Special Campaign that targeted online piracy of copyrighted content, they continue to encourage China to develop these periodic campaigns into sustained, long-term enforcement measures.
