‘Forced tech transfer’ has to stop or be regulated, says EU ambassador to China, by Huileng Tan.

Beijing sometimes forces foreign companies to hand over their technological know-how in exchange for access to its massive domestic market. The administration of U.S. President Donald Trump has demanded that China cease forced tech transfers, which have become a flashpoint in the U.S.-China trade war.

“This has to stop or to be regulated,”  Nicolas Chapuis, ambassador of the EU delegation to China] told CNBC at the European Chamber Annual Conference 2018 in Beijing.

“Of course if a company wants to open its tech books to a Chinese company — all right, that’s not an issue, but it has to be regulated so that there is no so-called ‘forced tech transfer,'” Chapuis said.

Beijing has claimed it will step up protection of intellectual property rights, but experts point out that the country still wields its state-controlled legal system to take whatever trade secrets it wants for its own companies.

One of those asymmetries that has to stop, even if it takes tariffs for a while.