Support Marketplace

Trademarks prevent Chinese contract bids

Beijing, CHINA: A US and a Chinese flag wave outside a commercial building in Beijing, 09 July 2007. US Secretary of State Condoleezza Rice 06 July 2007 accused China of flouting the rules of global trade in its headlong economic expansion as the US administration 'has not been hesitant' to deploy trade tools against China, including a complaint lodged with the World Trade Organization over copyright piracy.

TEXT OF STORY

STEVE CHIOTAKIS: Now the global perspective, what's happening in business and economics around the world and how it affects the U.S. The European Union today's unveiled a new trade plan, a major piece of which focuses on China. Europe wants to convince Beijing to allow more foreign companies to bid on Chinese government contracts -- a tough task for Europe, and the U.S.

As Marketplace China Bureau Chief Rob Schmitz reports.


ROB SCHMITZ: China insists it gives foreign companies unfettered access to bid on contracts like those for state-owned enterprises and local government projects. But the country has refused to sign an international treaty that requires a more open bidding process. That's frustrated U.S. corporations who would love a piece of China's gigantic government contract pie. But for years, companies interested in bidding on public contracts in China were required to register their trademarks in China. Jim McGregor, author of "One Billion Customers," says you might as well give the Chinese the blueprints to your product.

JIM MCGREGOR: I talk to a lot of senior executives and I've talked to a number of CEOs of tech companies in the last six months, and they may still be smiling when they come to Beijing, but behind closed doors, they're reassessing their business. Because it's no longer, "Will you lose your technology in the China market?" it's now, "Will you lose your technology in the China market, and will it come back and destroy part of your business globally." That's the worry.

SCHMITZ: Because of China's policies, few foreign companies end up bidding on government contracts, leaving billions in potential revenue out of reach.

In Shanghai, I'm Rob Schmitz, for Marketplace.

About the author

Rob Schmitz is Marketplace’s China correspondent in Shanghai.

Comments

I agree to American Public Media's Terms and Conditions.
With Generous Support From...