A 2013 report by a commission co-chaired by Jon Huntsman, ambassador to China under President Barack Obama and Trump's nominee to be Russian envoy, pegged the losses from USA intellectual property theft at hundreds of billions of dollars annually that cost the USA economy millions of jobs.
US President Donald Trump and Chinese President Xi Jinping (R) shake hands prior to a meeting on the sidelines of the G20 Summit in Hamburg, Germany, July 8, 2017.
During a media briefing on Saturday, administration officials rebutted the suggestion the trade action was meant to pressure China - North Korea's main trading partner and economic lifeline - to do more to rein in Pyongyang, even though Trump himself has said he would go easier on trade concerns with Beijing if they agreed to help put the squeeze on North Korea.
The administration official who confirmed that Trump would sign the order contended it was unrelated to the showdown with North Korea. "The action being taken on Monday is a reflection of the president's firm commitment to addressing this problem in a firm way".
"We would like to emphasize that the Chinese government has always attached importance to intellectual property protection", a spokesman said.
Senate Democratic leader Chuck Schumer took issue with that assessment. "To make an announcement that they're going to decide whether to have an investigation on China's well-documented theft of our intellectual property is another signal to China that it is OK to keep stealing".
According to a third senior administration official, these investigations could take as much as a year before the US Trade Representative could come out with its determination. "I think China can do a lot more" to help curb North Korea, "and I think China will do a lot more", Trump told reporters at his golf course in Bedminster, N.J., on Thursday. He said it would be premature to speculate on actions that could eventually be taken against China, and added that the issue could be resolved through "negotiated agreement". It was apparently put on hold while the USA lobbied China and other U.N. Security Council members to impose new sanctions on North Korea.
Trump will direct US Trade Representative Robert Lighthizer to determine whether any Chinese laws, policies or practices discriminate against or harm American innovators and technology companies, the officials said. Trump made addressing the USA trade deficit with China a centerpiece of his campaign a year ago and has suggested raising tariffs on goods from China.
"An important question going forward will be whether US companies and trade associations who have highlighted the problem will actually come forward and assist our government in the investigation" - Michael Wessel, member of the U.S.
The Section 301, which was passed in 1974 and heavily used in 1980s and early 1990s, would allow the US president to unilaterally impose tariffs or other trade restrictions against foreign countries.
The process can bypass World Trade Organization procedures for adjudicating grievances. "If China helps us, I feel a lot different toward trade".
The US officials said "Chinese commercial policy has a major goal, the acquisition and the absorption of the intellectual property of the United States and other countries around the world". The technology sector has been especially hard hit in IP disputes.