Akin Gump Strauss Hauer & Feld LLP

01/14/2020 | Press release | Distributed by Public on 01/14/2020 20:33

Clete Willems Quoted in Media on “Phase One” US-China Trade Deal

The South China Morning Post has quoted Akin Gump public law and policy partner Clete Willems in the article 'Trade war: China, US may not release full details of phase one deal set for signing this week.' The article reports that the details of the 'phase one' trade deal between the United States and China, expected to be signed this week, may not all be released to the public.

According to the article, among the aspects of the deal not likely to be released are specific targets for Chinese commodity purchases.

'You will get the top line categorical numbers, but not the individual product lines,' said Willems. He did confirm, however, that there would be purchases of poultry and beef - estimated at $1.5 billion apiece - with American farmers gaining re-entry to the market after years of being left out in the cold due to China's ban on certain hormones and additives used in US farming.

Willems was also quoted in the Barron's article 'A U.S.-China Trade Deal Is About to Be Signed. Investors Can't Rest Easy.' While the 'phase one' trade deal could end for now the threat of additional tariffs between the United States and China, the article reports that certain sectors and companies could still see plenty of volatility.

Willems, meanwhile, spoke about some of the specific facets of the deal, saying it includes substantive structural commitments that are likely to be broader and deeper than people expect as well as a reduction in some tariffs that have already been announced.

Among some of the deal's likely components, Willems said, are enforceable commitments from China to halt so-called forced tech transfers-the practice of requiring companies to turn over their intellectual property, enter joint ventures or license technology at below-market terms. He said there will also likely be detailed provisions for China to undertake appropriate judicial proceedings to enforce trade-secret laws as well patent extensions for U.S. pharmaceuticals in China. In addition, Willems expects commitments by Beijing not to manipulate its currency and an agreement to buy more U.S. agricultural products.

In discussing how the deal will be enforced, Willems said, 'To the extent there is any concern about the enforcement mechanism it has to do with its durability, not rigor. At some level, China is going to have to do what says it is going to do.'

Speaking with the Financial Times for the article 'US plans to restart forum for economic talks with China,' Willems commented on the importance of Washington and Beijing continuing to talk after the implementation of the deal.

'In a time of considerably heightened tensions between the US and China, it's critical that the two sides remain in touch at high levels as much as possible to try to solve their many problems. This should not replace the trade talks themselves, but is important regardless of what happens in phase two,' said Willems.