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MEMA Responds to Trump Administration Announcement of Additional 301 Tariffs on China

Date: July 11, 2018

MEMA opposes using tariffs to curb intellectual property (IP) theft and believes that the current, continued, and expected retaliatory tariffs could negate the Trump administration’s recent successful work on behalf of American companies, such as tax reform. The protection of intellectual property is a critical issue for MEMA and its members, and for decades MEMA has advocated for strong global protections of IP investments. However, MEMA fears that escalating this back-and-forth with a major trade partner will not resolve the issue at hand: intellectual property rights (IPR) protection is critical to the sustained success of the motor vehicle parts manufacturing industry, the largest sector of manufacturing jobs in the United States.

Motor vehicle parts manufacturers conduct almost one‐third of the annual $18 billion investment by the automotive industry in research and development. Motor vehicle parts are particularly vulnerable to counterfeiting and IP theft activities. Strong IPR protections are needed to encourage companies to support important research and development investment and to foster innovation as IPR owners are provided certainty that their inventions and technological advancements will be safe from infringers.

But these tariffs are taxes that hurt U.S. companies, put jobs at risk, and negatively impact consumers. Instead, MEMA supports stronger bi-lateral engagement where China and the U.S. work together to protect the valuable IP of our members, or leveraging the powerful relationships the U.S. has with other trading partners to pressure China to enforce their own IP laws and comply with international IP laws and regulations.

In May, MEMA testified before the United States Trade Representative (USTR) against these tariffs. During its testimony, MEMA highlighted that IP theft protections are critical but argued tariffs on motor vehicle parts manufacturers will be ineffective in obtaining these goals. To the contrary, such prohibitively high tariffs on these products will disproportionately harm U.S. businesses, including the motor parts and equipment manufacturers MEMA represents.

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