The Trump administration is preparing to open an investigation into China’s trade practices, multiple news outlets report on Wednesday, citing sources with knowledge of the plans.
The move would mark a continued shift away from emphasizing cooperation with China on North Korea above all else, as Trump has repeatedly signaled he is unhappy with Beijing’s policy prescription for dealing with Pyongyang.
The probe would be launched by using a domestic law which empowers Washington to raise tariffs within months, following an investigation. Others have warned that circumventing the WTO to unilaterally impose tariffs could lead to sanctions.
Perhaps more consequential to US companies that have had success in China than formal sanctions would be Beijing’s informal response. Companies such as Apple, rely heavily on cultivating a close relationship with authorities and could become collateral damage.
Chinese policy has emphasized the development of essential technology for the future, such as semiconductors, medical devices and driverless cars, but the country still relies on technology transfer from trading partners to achieve many of their goals in the fields. The Chinese government has demanded US companies to cut licensing fees for patents and to set up joint ventures to do business in China.