Six practical webinars for cooperation in or with China: This series of webinars offers insights in the what, how and with whom of the Chinese market. China has not been idle in the past year. It is waiting impatiently for new cooperation or the resumption of contacts with European companies. Cleantech Route China supports the internationalization strategy of  Flemish cleantech companies. With the correct knowledge and support there are many opportunities for Flemish companies. Through this series of webinars Cleantech China Route supports companies to achieve a flourishing cooperation in or with China.

Target group: All Flemish companies may subscribe. The webinars are accessible and suitable for companies in every phase of their internationalization process.

• Your company has only just started exploring the opportunities of the Chinese market, or
• You already covered part of the way

Practical: 

• During sessions of 1.5 hours a keynote speaker gives his or her view on the topic of the day.
• Supplemented by the insights  and experiences of additional speakers or a panel, you will receive a comprehensive view in a short time.
• During each webinar there is an opportunity to ask questions.
• Cleantech Route China has the support of the Flanders-China Chamber of Commerce, the EU SME Center and the China IPR SME Helpdesk

Programme: overview dates and topics

See which topics are interesting for your company and choose one or more of the six webinars. You need to subscribe for each webinar separately also if you want to join the whole series.

More information is available in Dutch at: https://www.cleantechroutechina.be/evenementen 

The Expo Central China 2021 will be held in Taiyuan City, Shanxi Province on May 21-23, 2021. The Expo will serve as a driver to boost the high-quality development of Central China and help the region join in domestic and international cooperation at a high level. It will also facilitate the new development paradigm featuring “dual circulations”, with domestic circulation as the mainstay and domestic and international circulations reinforcing each other. The Expo will include events like exhibitions, displays, investment and trade negotiation etc.

For more details about services, please visit Expo Central China 2021’s official website:

http://www.expocentralchina.org.cn/index.html 

The Flanders-China Chamber of Commerce, the EU-China Business Association, the China IPR SME Helpdesk and the China Chamber of Commerce / EU organized a webinar focused on “How to Protect Your Trade Secrets in China” on 13 April 2021.

Mr Peter Sczigel of the China IPR SME Helpdesk introduced the Helpdesk and the webinar’s speakers to the participants. He also introduced a few factsheets and business guides about mainland China which can be downloaded from the Helpdesk’s website. 

Ms Gwenn Sonck, Executive Director of the FCCC and EUCBA, gave a brief presentation of both organizations. She also said that the Chamber attaches much importance to IPR in China. Companies doing business with China should also have an IPR strategy in their China business plan. China has already become a leader in innovation in several areas, such as the internet industry and artificial intelligence. Speaking about innovation and speed, in Beijing, shops, restaurants and communities have signs showing the inoculation rate of the inhabitants or employees. Already 50% of the city’s population  has been vaccinated and the aim is to go to 70% – which is the threshold for herd immunity – by the end of May. This is something we can only dream of. According to the IMF, GDP growth in China will be 8.4% this year, which would be the highest in 10 years. Foreign investments in China have also increased by 6.2%. China overtook the U.S. and became the world’s top destination for FDI and will be one of the main drivers of growth this year. More business opportunities will also arise as the EU-China investment agreement will be signed, the most ambitious agreement that China has ever concluded with a third country. It will broaden market access and provide a better business environment for investors in Europe and China.

Mr Valentin de le Court, IPR Expert at the China IPR SME Helpdesk and leader of the China desk at Daldewolf, a Belgian business law firm, talked about the importance of keeping your secrets secret. It is a hot topic in China for several reasons. Trade secrets are used to protect highly valuable information. The world’s most valuable resource is no longer oil, it is data. How do you protect data? Through trade secrets confidentiality. Hardly a week goes by without reports about alleged trade secret theft by Chines individuals, state-sponsored hackers and employees. The topic of trade secrets has been included in the EU-China trade agreement, so there is also a political dimension. In the past year we have witnessed a very intense legislative dynamism when it comes to trade secrets protection in the U.S., the EU and China.  

We live in a knowledge-based, information-based, ever more digitized economy. Looking at the S&P500 of the best performing companies in the world, in 1975, intangible assets represented 17% of corporate value, rising to 90% in 2020. Intangible assets are playing a key role in today’s economy. The value of a company is determined by its capacity to innovate and to appropriate, control, exploit and monetize the results of its innovation. The law provides two important tools to manage the results of your innovation. First, intellectual property rights, including trademarks, patents, copyrights, and design rights. An IP right is an exclusive right, a monopoly that is granted. The second tool is trade secrets. They are not IP rights, so no exclusive right is granted, but they protect you against unlawful acts. 

A patent is an exclusive right granted for an invention. It enables the patent holder to exclude others from making, using, offering for sale or selling the invention without the patentee’s authorization. The invention must be new, inventive and applicable industrially. A patent is public information, available in patent registries. In return you get an exclusive right for a limited time. The main characteristic of a trade secret is that it is confidential. The protection of a trade secret is mainly factual. That will depend on the nature of the information and the way it is handled. Once it is known, it is not protected anymore and you lose the competitive advantage that you had. Trade secrets can cover a wide variety of information, not only technical, but also commercial and financial information. IP rights grant you an exclusive right, trade secrets provide protection against unlawful acts. Trade secrets and IP are complementary. Innovative EU firms use both patents and trade secrets, but they use more trade secrets than patents for protecting innovations. 

Risks related to trade secrets have increased over the years. Trade secret thefts are on the rise because there is an increased flow of information. This is due to several factors: internet and digitization, open innovation, globalization of supply chains, the mobility of workers, and hacking. The biggest risk to trade secrets is not hackers, but people close to the business, such as employees, ex-employees and business partners. The majority of trade secret cases are among people that know each other.  

How to protect your trade secrets? It requires an appropriate legal framework and an internal strategy for the management and protection of trade secrets. Over the past years there was a global awareness of the need to reinforce the protection of trade secrets, including in the U.S., the EU and China. The legal framework has improved, but most EU businesses still lack a clear internal management and protection strategy for trade secrets, which is the only way for effective protection. You need to have a trade secret action plan including five actions: audit, inventory, improvement, education, and monitoring and reacting. 

In China, the centerpiece of trade secrets protection is the Anti-Unfair Competition Law (AUCL), revised in 2017 and 2019. There is also a set of other laws and regulations that can have an impact. Several rules were adopted last year by the Supreme People’s Court (SPC). In China there is a clear political will to strengthen trade secrets protection and enforcement. Looking at article 9 of the AUCL, we see that the definition of “trade secret” has been broadened to include all commercial information, not limited to technical and business information. The scope of trade secrets misappropriation has been expanded to include hacking and indirect infringement. Who is liable for misappropriation has also been clarified. There is no limitation to “business operators” and now includes individuals, legal persons and non-legal organizations. A Supreme People’s Court interpretation was issued in September 2020, providing guidance to courts on how to treat trade secrets cases and to companies on how to protect their trade secrets. 

Trade secrets protection requires trade secrets identification. Under Chinese law a trade secret is commercial information such as technical information, business information and etc. that are not known to the public, have commercial value and for which reasonable efforts to maintain secrecy have been made by the rights holder. EU law roughly presents the same approach. It is a broad and open notion. The SPC clearly identifies typical information that may qualify as trade secrets, including technical and business operation information. Almost any kind of information can qualify as a trade secret. The second requirement is secrecy and confidentiality. The information is not widely known and not easily accessible. The ease of access to the information is the key criteria to assess whether information is confidential or not. The third requirement is to assess the commercial value of the information. It is information that has practical or potential market value because it is not known to the public and it must provide a competitive advantage because of its secrecy. The last requirement is vey important: to adopt reasonable steps to keep the information secret. Protection of trade secrets is not automatic, you need to take proactive measures. If you don’t adopt protection measures, information will not qualify as a trade secret, and you won’t be protected. You will need to convince a judge that you adopted measures to prevent what happened. Concerning the required measures there is no size fits all. The judge will not expect the same measures from a start-up as from a multinational. 

Reasonable steps to implement include contracts, training and regulations, physical barriers, access management, IT measures, HR management  and other reasonable measures of confidentiality. A non-disclosure agreement (NDA) is a good start, but is not enough. Trade secrets infringement includes obtaining trade secrets through theft, fraud, coercion, electronic intrusion or other improper means and disclosing, using, and allowing others to use illicitly acquired trade secrets. It also includes the second degree infringer. Remedies include civil enforcement and administrative / criminal enforcement. The maximum statutory damages have increased to CNY5 million or €650,000. There are specialized IP courts and an IP division at the Supreme People’s Court. The main difficulty of enforcement is evidence. The win rate in China is relatively low but difficult to asses. In an SPC judgement of February 26, 2021, the highest ever damages for a trade secrets case of CNY159 million were awarded. 

Take aways:

• • Trade secrets are widely used
• • Trade secrets enforcement is challenging in China
• • Pay special attention to employees and business partners
• • Prevention is key and pro-active management is the only way to protect your trade secrets.
• • There are positive legislative changes
• • Implement a trade secret action plan

A Q&A session concluded the webinar. 

The first China-developed mRNA Covid-19 vaccine is expected to enter Phase III clinical trials overseas next month, vaccine developer Suzhou Abogen Biosciences confirmed. Production capacity could reach some 120 million doses this year, according to the company’s founder Ying Bo, which will be a major breakthrough in domestic mRNA vaccines’ research and development (R&D). Experts suggest that using different types of vaccines – inactivated, mRNA, or adenovirus ones – to inoculate people could deliver better immunity. Being able to be stored and delivered in the usual range of 2º to 8ºC will make this domestic ARCoV vaccine stand out from Western mRNA vaccines made by Pfizer-BioNTech and Moderna, which require much lower temperatures. “From animal and clinical trial results, we see that ARCoV is fairly competitive with the other two mainstream mRNA vaccines in overseas markets,” Ying said. The producer is applying to start ARCoV’s Phase III trials overseas, likely in Latin American countries, expected in early May. Abogen announced the completion of a B round of financing totaling CNY600 million to accelerate vaccine R&D and production.

Chinese vaccine producer CanSinoBio said hat it had not received any report of blood clots after vaccination of millions of people with its recombinant adenovirus vector Covid-19 vaccine, amid reports that inoculations with the AstraZeneca and Johnson & Johnson’s vaccines were discontinued in several countries. CanSinoBio said that, although its vaccine uses the same technique, it uses a different adenovirus than the other two companies. CanSinoBio uses adenovirus type-5 as vector, a common adenovirus among humans, while AstraZeneca uses a chimpanzee adenovirus and Johnson & Johnson uses an adenovirus type-26.

Fosun Pharma has also submitted clinical trial data of BioNTech’s Covid-19 mRNA vaccine to China’s state regulator for review, in preparation for importing the first foreign-made Covid-19 vaccine. Approval is expected within the next 10 weeks. As some expats in China requested more vaccine options, experts said that approval of such imports could benefit foreigners coming to China. Many expats living in China have wanted some foreign-made vaccines for easier recognition when they return home. Once approved, BioNTech and Fosun would initially plan to supply the vaccine from BioNTech’s state-of-the-art production facilities in Germany, and BioNTech may consider shipping the bulk vaccine substance to the Chinese mainland for further packaging. The vaccine was approved in January for emergency use in Hong Kong.

China’s first biosecurity law went into effect, marking a “major milestone” for upholding the rule of law in areas critical to people’s health, the environment and national security, experts said. The law introduced regulations in eight major categories – infectious disease prevention and control, regulating research and applications related to biotechnology, biological laboratory safety and practices, protecting biological resources and human genetic resources, preventing invasive species and preserving biodiversity, tackling drug resistant microbial infections, deterring bioterrorism, and other activities related to biosecurity. Experts called the law “foundational legislation” that will guide, coordinate and introduce new laws and regulations related to biosafety. China has nearly 100 pieces of legislation and regulation related to biosecurity, according to law firm King & Wood Mallesons. However, many of them are either outdated or are difficult to enforce. In February last year, President Xi Jinping said biosecurity is vital to people’s health and the longterm stability of the country, hence it should be included in the national security system. The law was passed in October. 

This overview is based on reporting by the China Daily, Shanghai Daily and Global Times.

China’s GDP grew by 18.3% year-on-year in the first quarter of 2021 to CNY24.9 trillion, the fastest in three decades, with key economic indicators all expanding at over 20%, setting an encouraging start for the year. The data provide an indication of the strength of China’s economic recovery, which has been retaking lost ground since the second half of 2020. The country is likely to record the highest growth among major economies and make the greatest contribution to the global economy in the first quarter, analysts noted. Looking ahead, China’s economy is forecast to keep a stable growth, but may enter “unchartered waters” in the second half of the year as geopolitical tensions keep developing and the marginal effect of global economic recovery has weakened.
Some analysts are upbeat about China’s GDP which might increase by double-digits in the second quarter. For the whole year, the growth rate could reach 9%, analysts said, well above the government-set goal of “above 6%”.

In the first three months of 2020, the Chinese economy contracted by 6.8% due to the coronavirus lockdown. In the first quarter of this year, retail sales soared 33.9%, fixed-asset investment (FAI) jumped 25.6%, and industrial production gained over 24.5%, data released by the National Bureau of Statistics (NBS) showed. In March alone, retail sales jumped 34.2% year-on-year, with the growth rate quickening 0.4 percentage points from the first two months. Industry observers said the data underscores a broadened recovery momentum, particularly in March, which marks a watershed in consumption from “divergent recovery” to “going full swing.” “The pace of the economic recovery in the second and following quarters would rely more on the recovery of the service sector,” Fidelity International said in a note. Building on the momentum, China will continue to make the biggest contribution to the global economy, serving as an engine of growth for the world. Its gap with the U.S. is expected to further narrow. In 2020, China’s economic volume represented about 70% that of the U.S., the Global Times reports. 

After surpassing the U.S. as the world’s biggest recipient of foreign direct investment (FDI) in 2020, China continues to see rapid growth in foreign investment this year, as confidence in the country’ growth prospects and opening-up further improves. The Ministry of Commerce (MOFCOM) reported that the first quarter of 2021 saw the country’s actual use of foreign investment hitting CNY302.47 billion, up 39.9% year-on-year. “Compared with the same period in 2019, the country’s actual use of foreign investment during the first quarter saw an increase of 24.8%,” Ministry Spokesman Gao Feng said. In U.S. dollar terms, China’s actual use of foreign capital in the first quarter reached USD44.86 billion, up 43.8%  year-on-year. Moreover, 10,263 foreign-invested enterprises (FIEs) were established during the period, up 47.8% year-on-year. The figure was 6.7% higher than in the same period in 2019. Zhang Fei, Associate Director of the Institute of Foreign Investment of the Chinese Academy of International Trade and Economic Cooperation, said the data demonstrates the upward momentum of China’s use of foreign capital, considering the number of newly established foreign-invested enterprises and the amount of foreign investment have both swelled significantly no matter how they are compared with the same period last year or in 2019.

“Foreign companies have generally enjoyed high-level profit growth in the China market, which boosted their confidence to keep investing in China, thanks to continuously enhanced negative lists, the ever-improving business environment, and the efforts by local governments at different levels to serve foreign investment projects,” Zhang said. Inflows of foreign capital into high-tech industries, especially high-tech services, keep growing quickly, while sources of foreign investment also expand. Actual use of foreign capital in the services sector rose 51.5% year-on-year to CNY237.79 billion during the first quarter. The high-tech sector’s actual use of foreign capital expanded 32.1% on a yearly basis. The year-on-year growth in high-tech services was 43.9% and in high-tech manufacturing sectors 2.5%. As for the investment sources, inflows of foreign capital from countries participating in the Belt and Road Initiative (BRI) increased by 58.2%, from members of the Association of Southeast Asian Nations (ASEAN) by 60% and from nations of the European Union by 7.5% on a yearly basis in the first quarter. 

The total imports and exports of goods surged 29.2% year-on-year in the first quarter to CNY8.47 trillion. Exports jumped 38.7% from a year earlier and imports climbed 19.3% in yuan terms. The trade surplus expanded 690.6% to CNY759.29 billion. In March alone, China’s exports in dollar terms soared 30.6% in March from a year earlier while imports jumped 38.1%.

China-U.S. trade increased by a striking 61.3% in yuan terms in the first quarter of this year to reach CNY1.08 trillion. This growth outpaced all of China’s other major trading partners including Japan, the EU, and ASEAN. The U.S. trade deficit with China reached CNY472 billion in the first quarter. China’s trade with the EU and ASEAN economies rose 36.4% and 26.1% in the first quarter. 

This overview is based on reporting by the China Daily, Shanghai Daily and Global Times.