Position America to Compete and Thrive Worldwide

The country that wins the innovation race wins the future. Other countries are challenging U.S. leadership in innovation in the competition to secure capital and talent, bring new products and services to market, set technology standards, and dominate strategic technologies. The country must understand the scope of their efforts and respond to their actions while promoting market access for U.S. innovations as well as rules to protect those innovations and investments.

The global competitive landscape for innovation leadership continues to evolve. Increasingly, countries with competitive innovation profiles undertake large-scale strategic planning, rulemaking, subsidy and investment initiatives to attain leadership in emerging technologies. Countries compete with the United States to secure capital and talent, gain an edge in the market for new products and services, and establish standards and rules of the road for emerging and strategic technologies.

Unfortunately, some countries aggressively pursue innovation leadership in ways that undercut terms set by international trade agreements and seek to push standards and rules that can undermine U.S. innovation and leadership. Some engage in unfair trade and commercial practices designed to advance their innovation at the expense of U.S. companies through heavy-handed data localization requirements, intellectual property theft, barriers to market access, discriminatory licensing requirements and technology transfer demands. These systematic efforts distort fair competition and create an uneven playing field for U.S. firms in innovation-intensive industries, including industries with serious implications for U.S. critical infrastructure and national security.

While the current multilateral trade rules and trade and investment agreements may not address all these issues fully, the commitments made should be upheld and new commitments should be negotiated to address unfair trade, investment, and regulatory practices that harm U.S. innovation. The opportunity to compete on a level playing field according to principles of fair and open market access not only positions U.S. firms and innovators to succeed in the global innovation economy but also promotes an open culture of innovation worldwide, to the benefit of all. The United States must continue its legacy of leadership setting the rules of trade in a manner that promotes and protects U.S. innovation. 

Leading U.S. firms are competing in global markets and face challenges stemming from unfair and market-distorting practices.

Unfair trade practices, failure to comply with existing commitments and discriminatory rules impose high costs on U.S. firms, the economy and vital U.S. interests.

International agreements and commitments can establish common standards and best practices for innovative technologies. 

Policy Recommendations

  1. Combat intellectual property theft. The United States should strengthen commitments, monitoring, enforcement and penalties surrounding domestic and international rules to protect intellectual property from theft, counterfeiting, forced transfer and infringement by working with international partners and foreign governments to:
  2. Uphold and reinforce norms of intellectual property protection. The United States and its international partners should expand enforcement capacity for intellectual property protection and promote meaningful compliance.
  3. Eliminate technology transfer requirements, including compulsory licensing, and regulatory preferences for indigenous innovation. The United States and its international partners should seek a level playing field by eliminating technology transfer requirements and other regulatory measures that contribute to forced or coerced technology transfer.
  4. Counter technology restrictions by partnering with like-minded countries and negotiating commitments on forced technology transfers. The federal government should work with like-minded countries through engagement and negotiations to counter technology restrictions, protectionist cybersecurity rules, data localization requirements, and requirements for businesses to transfer technology and intellectual property as a condition to access foreign markets.
  5. Lead in the development and enforcement of international commitments, standards, norms and best practices. The federal government and U.S. companies should lead in the development and enforcement of international commitments, standards, norms and best practices for the development and application of emerging technologies to create a stable and level playing field. Examples include cybersecurity, digital privacy, data flows, blockchain, internet of things, and energy and the environment.
  6. Strengthen participation in international standards setting. The federal government and U.S. companies should expand participation in international standards-setting bodies to prevent the development and adoption of discriminatory international and country-specific standards or commitments.
  7. Counter the use of foreign subsidies targeting innovative technologies. The United States and its international counterparts should create and strengthen domestic and international rules to discipline government provision of subsidies to domestic companies that distort competition. 

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