Chapter V "Protection of Intellectual Property Rights Related to Foreign Trade" of the Foreign Trade Law of the People's Republic of China (the "Foreign Trade Law"), revised on December 27, 2025, stipulates trade policy tools concerning the protection of intellectual property rights (“IPR”) involved in foreign trade. In addition, the Provisions of the State Council on the Handling of Foreign-Related Intellectual Property Disputes (Decree No. 801 of the State Council, the "Provisions"), which came into force on May 1, 2025, also outlines provisions for addressing foreign-related intellectual property disputes in connection with foreign trade.

Together, these regulations constitute a policy toolkit for IPR protection in China's foreign trade sector by delineating the oversight powers of authorities such as the Ministry of Commerce of the People's Republic of China ("MOFCOM") and institutionalizing a system of diversified policy tools, including trade investigations, restrictive measures, and countermeasures. This article elaborates on the specifics, applicable conditions, and implementation paths of the aforementioned policy tools from an international trade perspective.

I. Trade Investigation Tools

Pursuant to the aforementioned regulations, trade investigation tools mainly focus on the following three core aspects:

(I) Investigation of IPR Infringement by Imported Goods

Article 32 of the Foreign Trade Law and Article 14(1) of the Provisions clearly stipulate that MOFCOM is authorized to initiate an investigation where "imported goods infringe intellectual property rights and harm the foreign trade order". Such investigations primarily target IPR infringement acts in cross-border of goods, which are comparable to the Section 337 investigations initiated by the U.S. International Trade Commission (ITC) against imported products involving IPR. To date, China has yet to conduct any investigations or imposed any trade prohibitions or restrictions on imported products involving IPR infringement.

Compared with traditional civil IPR infringement cases, IPR infringement investigations under the Foreign Trade Law place greater emphasis on assessing the impact of the infringing acts on China's foreign trade order, which include the import volume of infringing goods, relevant domestic industries, and the fair market competition environment. The investigation process comprises key stages, including establishing facts of infringement, identifying the infringing parties, and tracking the import and export of infringing goods. Possible measures may include prohibiting or restricting the import of infringing products during customs clearance. In the future, China may initiate such investigations as a new trade investigation tool to enforce IPR protection upon entry of products.

(II) Investigation of IPR Abuse

To address widespread abuse of IPR in international trade, Article 34 of the Foreign Trade Law and Article 14(2) of the Provisions confer upon MOFCOM the power to investigate specific abusive practices. Specifically, the investigation targets three typical forms of conduct by IPR owners: 

(i) prohibiting licensees from challenging the validity of the IPR in the license contract; 

(ii) imposing mandatory package licensing; 

(iii) stipulating exclusive grant-back clauses in license contracts.

Compared with antitrust regulations, investigations under the Foreign Trade Law focus more specifically on the impact of these practices on China's foreign trade order, with a more targeted scope of application, and can serve as an effective supplement to competition law regulation.

(III) Investigation of Unfair Treatment in IPR Protection

To protect Chinese IPR on a global scale, Article 35 of the Foreign Trade Law and Article 14(3) of the Provisions establish a targeted investigation mechanism. Where "other countries or regions deny national treatment to Chinese individuals or organizations in terms of IPR protection or fail to afford adequate and effective protection for goods, technologies, or services originating from China", MOFCOM may initiate an investigation in accordance with the law.

Essentially, such investigations embody the "principle of reciprocity" for IPR protection in international trade. They involve the IPR legal framework, law enforcement practices, and results of specific case handling in the target countries or regions, aiming to comprehensively assess how IPR protection for Chinese entities is implemented locally. From a perspective of practice, this investigation mechanism provides a preliminary assessment tool for China to address discriminatory treatment in foreign IPR protection and may function similarly to the U.S. Section 301 in the IPR sphere, laying factual ground for the subsequent adoption of trade remedial measures.

II. Prohibitive and Restrictive Measures

On the basis of trade investigations, the Foreign Trade Law and the Provisions specify a series of restrictive measures aimed at eliminating the harms caused by IPR-related illegal acts.

(I) Restrictions on the Import of Infringing Goods

In response to IPR infringement by imported goods, Article 32 of the Foreign Trade Law explicitly provides that MOFCOM may take restrictive measures of "prohibiting the import of relevant goods produced or sold by infringers within a certain period of time". The term "infringers" herein includes both overseas producers and sellers of goods, as well as domestic import agents and other relevant entities. This measure directly targets the cross-border circulation of infringing goods and can quickly block the entry of infringing goods into the domestic market.

(II) Regulatory Measures for Abuse of Intellectual Property Rights

With respect to acts of abuse of IPR that harm the fair competition order in foreign trade, Article 34 of the Foreign Trade Law empowers MOFCOM to "take necessary measures to eliminate the harms". Given the lack of precedents, the specifics of these measures remain undefined. It is probable that they may include prohibitive or restrictive sales measures at the trade level to compel the actors to change their behavior. Unlike antitrust penalties, such measures focus more on the immediate restoration of the trade order, so they opt to a combination of administrative guidance and mandatory intervention to facilitate a quick elimination of misconducts.

(III) Restrictions on Cross-Border Evidence and Data Transfer

In response to cross-border service of documents and evidence collection, Articles 12 and 13 of the Provisions set forth targeted restrictive measures. On the one hand, it is clarified that "the service of documents and conduct of investigations and evidence collection within the territory of China shall be carried out in accordance with the international treaties concluded or acceded to by China and the relevant domestic legal provisions", and no organization or individual may conduct service of documents or evidence collection within the territory of China in violation of legal provisions.

On the other hand, it is required that when organizations or individuals within the territory of China provide IPR-related evidence or materials to foreign parties, they must comply with laws and regulations concerning the protection of state secrets, data security, personal information protection, and the administration of technology export; where approval by the competent authority is required in accordance with the law, the requisite approval procedure must be undertaken.

III. Countermeasure Tools: Safeguards against Overseas Discriminatory Measures

The Foreign Trade Law outlines general countermeasures in the trade domain. Furthermore, Articles 15 and 17 of the Provisions specify targeted countermeasures, underpinned by the objectives of safeguarding national sovereignty, security, and development interests, and establishing a legal tool for China to respond to overseas discriminatory restrictions on IPR.

(I) Countermeasures against Entities Implementing Discriminatory Measures

Article 15 of the Provisions clearly states that where a foreign country, in violation of international law and the basic norms governing international relations, uses IPR disputes as a pretext to contain or suppress China, imposes discriminatory restrictive measures on Chinese citizens or organizations, or interferes in China's internal affairs, the relevant departments of the State Council may, in accordance with laws such as the Law on Foreign Relations of the People's Republic of China and the Anti-Foreign Sanctions Law of the People's Republic of China, include organizations or individuals that directly or indirectly participate in formulating, deciding on, or implementing the discriminatory restrictive measures in the countermeasure list, and impose corresponding countermeasures and restrictions.

(II) Accountability and Restrictions on Illegal Assisting Acts

To block the cross-border implementation of overseas discriminatory measures, Article 16 of the Provisions establishes a supporting accountability mechanism: first, it explicitly stipulates that "no organization or individual shall implement or assist in the implementation of discriminatory restrictive measures imposed by a foreign country on Chinese citizens or organizations on the pretext of IPR disputes"; second, it provides that where the aforementioned obligation is violated and the legitimate rights and interests of Chinese citizens or organizations are infringed upon, the victim may file a lawsuit with a people's court in accordance with the law, requesting the infringer to cease the infringement and compensate for losses. This clause constructs a countermeasure barrier at the level of regulating the conduct of market entities and urges all types of entities to refuse to cooperate with improper overseas measures by pursuing civil liability.

(III) Comprehensive Regulation of Acts Endangering National Interests

Article 17 of the Provisions further clarifies that for acts that use IPR disputes to endanger China's sovereignty, security, or development interests, the Chinese government may take corresponding measures in accordance with laws such as the National Security Law of the People's Republic of China and the Law on Foreign Relations of the People's Republic of China. Such measures form a cross-sectoral toolbox, authorizing multiple departments to jointly take comprehensive countermeasures and measures.

IV. Coordinated Implementation of Policy Tools

The aforementioned trade investigations, restrictive measures, and countermeasures form a comprehensive, coordinated system of "prevention-investigation-regulation-countermeasure". In practice, government departments such as MOFCOM will strengthen their inter-agency coordination and enhance the effectiveness of policy tools through information sharing, joint law enforcement, and other means.

In conclusion, the policy toolkit established by Chapter V of the Foreign Trade Law and the Provisions is formal, targeted, and acts as a potent deterrent, providing legal and policy instruments for the Chinese government to manage IPR in a foreign trade context.