Shift from imitation to stronger intellectual‑property posture

China’s IP Transformation

China’s intellectual property (IP) regime has entered a new, more assertive phase, shedding its historical image of imitation and lax enforcement in favor of a strategic, innovation-driven posture. This transformation, guided by the 15th Five-Year Plan (2026–2030), is intensifying legislative reforms, judicial rigor, and corporate mobilization to secure technological sovereignty amid an increasingly fraught geopolitical landscape. Recent developments highlight how IP governance is now inseparable from the broader U.S.–China tech rivalry, embedding IP protection at the heart of economic growth, national security, and international trade dynamics.

From Imitation to Innovation: Legislative and Institutional Reinforcement

China’s commitment to strengthening its IP framework is more resolute than ever, with the 15th Five-Year Plan explicitly positioning IP strategy as a key pillar for economic modernization and global integration. Key steps include:

Enhanced legal frameworks and reforms enacted over the past year have tightened protections for innovators and streamlined dispute resolution. This legislative momentum reflects Beijing’s goal to align domestic IP regimes with high-standard international norms, smoothing China’s participation in global trade and investment.
Specialized IP courts in major hubs (Beijing, Shanghai, Shenzhen) continue to mature, handling more complex and cross-border cases with growing professionalism. Their expanded jurisdiction and improved transparency boost confidence among domestic and foreign innovators.
Official crackdowns on counterfeiting and infringement are increasingly publicized, signaling a break from prior eras of perceived leniency. These actions reinforce the government’s message that IP violations undermine China’s innovation ambitions and economic stability.

Strategic IP Accumulation in Emerging Technologies

China is aggressively building its domestic IP portfolio to reduce reliance on foreign technology and assert leadership in critical sectors:

Chinese entities now dominate global patent filings in semiconductors, AI, biotechnology, and brain-computer interface (BCI) technologies, reflecting a strategic prioritization of future growth industries.
A notable advance reported recently involves the development of a smaller, faster, and more energy-efficient transistor for AI chips, underscoring progress in overcoming semiconductor bottlenecks critical to hardware IP self-sufficiency.
Industry giants like Huawei are rapidly scaling domestic AI chip production, supported by policies promoting indigenous innovation and comprehensive IP development.
Brain-computer interface research in China continues to close the technology gap with the U.S., positioning China as a global leader in this emerging field with significant IP and security implications.

Geopolitical Frictions and the Expanding IP Battlefield

The intensification of U.S.–China tech competition has transformed IP governance into a frontline of geopolitical contestation, with several recent flashpoints illustrating this complexity:

The Anthropic Claude AI incident, where three Chinese companies were accused of illicitly distilling the proprietary Claude AI model, exemplifies the challenges of protecting cloud-based AI IP in a globally interconnected environment.
Reports that DeepSeek, a Chinese AI startup, circumvented U.S. export controls by training AI models on Nvidia’s Blackwell chips despite bans highlight enforcement challenges in restricting sensitive semiconductor technology transfer.
China’s imposition of export controls on 40 Japanese entities over dual-use goods signals reciprocal escalation and growing contestation over critical supply chains and dual-use technology governance.
The semiconductor export dispute involving Singapore-based Nexperia, owned by a Chinese company, underscores the fragility of chip supply chains amid investigations and regulatory scrutiny from multiple governments.
Espionage cases such as the arrest of Ji Chaoqun, dubbed “China’s Perfect Spy,” deepen mistrust by illustrating ongoing illicit efforts to acquire sensitive U.S. IP and technology.
Chinese official rhetoric increasingly frames the AI and semiconductor rivalry with the U.S. as a geopolitical contest, amplifying both propaganda and strategic competition dimensions.

Corporate and Supply-Chain Adaptations to a Complex IP Environment

Multinational corporations and governments are recalibrating strategies to mitigate IP risks and geopolitical uncertainties:

Foreign firms are tightening contractual IP protections, enhancing due diligence, and embedding robust risk management to prevent unauthorized technology transfer and IP leakage.
There is a noticeable trend toward diversifying R&D and manufacturing beyond China, adopting multi-hub innovation models that balance market access with IP security. Empirical studies show increased adoption of digital intelligence tools to secure supply chains and manage geopolitical risks.
Globally, investment screening and export controls are intensifying, reflecting heightened awareness of the nexus between IP, national security, and economic policy.
Chinese companies are responding by restructuring overseas operations, as exemplified by MGI Technology’s divestiture of its U.S. subsidiary amid rising geopolitical tensions.
Supply-chain shifts include Apple’s accelerated diversification away from Taiwan-based suppliers following classified U.S. intelligence warnings about potential geopolitical instability, underscoring the strategic imperative to protect IP and maintain production continuity.
Beijing’s recent pushback against major U.S. brands such as Apple and McDonald’s signals a recalibrating corporate-state relationship that could reshape market access and IP enforcement dynamics within China.

Rising Political Frictions Amplify IP Risks and Market Access Challenges

Recent reporting from the South China Morning Post and other sources underscores an environment of deepening political distrust even as diplomatic efforts pursue stable engagement:

U.S. officials warn of “deep distrust” between Washington and Beijing, complicating efforts to stabilize ties ahead of high-level summits.
This political distrust permeates technology and IP domains, intensifying scrutiny on Chinese electric vehicles’ potential access to U.S. roads and raising broader questions about market access, regulatory barriers, and IP security.
As the U.S.–China tech competition evolves into a new era, IP governance is increasingly entangled with diplomatic, security, and economic strategies, making coherent policy coordination essential.

Implications: IP Governance at the Nexus of Innovation and Geopolitics

China’s evolving IP posture is no longer merely a domestic economic matter but a critical front in the global technological and geopolitical struggle:

The intersection of legislative reform, judicial enforcement, export controls, and corporate strategy creates a complex ecosystem where IP protection is both a driver and a battleground of strategic competition.
Stakeholders must navigate competing imperatives—fostering innovation, protecting IP, managing export control risks, and maintaining international cooperation—amid escalating geopolitical tensions.
The adoption of advanced digital intelligence for supply-chain security and diversified innovation footprints reflects pragmatic adaptation to a volatile environment.
The ongoing U.S.–China technology rivalry, including contentious debates over AI, semiconductors, and dual-use technologies, promises to keep IP governance at the forefront of international economic and security policy agendas.

Conclusion

China’s transformation from an IP imitator to a confident, assertive innovator with a fortified IP regime is now unmistakably deepening under the 15th Five-Year Plan. Legislative enhancements, judicial modernization, and visible enforcement actions are building a more credible and strategic IP environment that fuels domestic innovation and attracts foreign participation. However, recent developments—from AI model misappropriation and export-control circumvention to corporate restructuring and geopolitical friction—highlight the multifaceted and high-stakes nature of IP governance amid intensifying U.S.–China tech competition.

The framing of technological rivalry as a geopolitical contest, combined with rising domestic pushback against foreign corporate influence, adds layers of complexity for multinational corporations and policymakers alike. Successfully navigating this evolving landscape requires sophisticated, coordinated strategies that balance innovation imperatives with security realities and geopolitical sensitivities.

As China advances its technological capabilities and deepens IP protections, the IP domain will remain a critical and contested front in the global struggle for technological supremacy well into the coming decade.

Sources (22)