High-ranking representatives of the U.S. and Chinese governments convened in Hangzhou on 28-29 October for the 20th annual meeting of the U.S.-China Joint Commission on Commerce and Trade. According to a press release from the Office of the U.S. Trade Representative, the two sides achieved modest progress in a number of areas, including trade in pork products, clean energy, distribution services, government procurement, intellectual property rights, information security, medical devices, pharmaceuticals, and travel and tourism.

Probably the most important achievement by the U.S. delegation was a commitment by China to re-open its market to U.S. pork products and live swine, which had been banned in the mainland following an H1N1 influenza (swine flu) outbreak. Mainland China was the third largest foreign market for U.S. pork in 2008 with total exports of about 400,000 metric tonnes worth some US$690 million. However, the H1N1-related ban on U.S. pork resulted in a 50 percent drop in shipments during January-August 2009, although sales are now expected to rebound strongly during the next few months. China still maintains a ban on U.S. pork produced with ractopamine, an FDA-approved feed additive that reportedly improves efficiency in pork production but that mainland Chinese authorities consider unsafe.

A USTR fact sheet outlined the following additional specific commitments.

• Agriculture. The U.S. Department of Agriculture and China’s Ministry of Agriculture  announced a memorandum of understanding on co-operation in agriculture, which renews the Joint Committee on Cooperation in Agriculture and provides additional opportunities for MOA and USDA to engage on co-operative agricultural issues.
• Clean Energy. China agreed to eliminate local content requirements on wind turbines.
• Distribution Services. China announced that it is in the process of concluding its licensing procedures for certain qualified direct selling services companies.
• Government Procurement. China will require that products produced in the mainland by foreign invested enterprises are treated as domestic products and will issue rules in this regard. The U.S. and China will establish a multi-agency working group to regularly conduct discussions on issues involving government procurement and purchases by state-affiliated enterprises and organisations and private parties that make purchases in accordance with national strategic objectives. In addition, China committed to submit a revised offer as early as possible in 2010 to accede to the World Trade Organisation Government Procurement Agreement.
• Information Security. China confirmed in working group discussions that the compulsory certification testing and certification rules for 13 categories of information security products announced in April 2009 apply only to products procured by mainland Chinese government agencies. China agreed to establish a dialogue with the U.S. regarding global practices for trade in information security products.
• IPR. China gave assurances that it will impose maximum administrative penalties on Internet infringers and has begun a four-month campaign to clamp down on Internet piracy. Chinese authorities recently issued a notice conveying to state-run libraries the importance of strengthening protection of copyright-protected academic and medical journals. China also agreed to work closely with the U.S. to resolve U.S. concerns about a new Ministry of Culture circular relating to on-line music distribution that is creating serious problems for the U.S. music industry. Finally, the Intellectual Property Working Group identified next steps on key issues, including: China’s further promotion of software legalisation of enterprises and exchanges of information on measures for promoting software legalisation; China’s establishment of a broadcast tariff rate as soon as possible; and opportunities for interested rights holders and government experts to provide feedback on China’s new Patent Law amendments and new implementing regulations.
• Medical Devices. China committed that product recall regulations will not be duplicative or redundant and the Ministry of Health and the State Food and Drug Administration will be the relevant authorities for medical device recalls. China committed to adopt a risk-based approach that will not automatically lead to clinical trials for medical devices in a given class and will consider the use of results from a clinical trial conducted outside of the mainland to support a local clinical trial exemption. China will accept a prior approval document of a medical device issued by a foreign country regardless of its exporting origin, country of manufacture or legal manufacture to satisfy any prior approval registration requirement. It will also consider an exemption from requiring product samples to be tested in mainland Chinese test labs prior to approval if the manufacturer demonstrates compliance with international standards and provides sound scientific evidence. Moreover, Chinese authorities will strive to implement regulations, rules and notices that are consistent with guidance documents for medical devices issued by the Global Harmonisation Task Force and the Asia Harmonisation Working Party.
• Pharmaceuticals. China will continue to strengthen its oversight and enforcement of active pharmaceutical ingredients and counterfeit pharmaceuticals by undertaking initiatives such as the establishment of a drug master file system, enforcement of record-keeping requirements for companies that manufacture and sell APIs, and regulation of unregistered mainland Chinese companies advertising and marketing APIs at foreign trade shows and on the Internet. China agreed to share information with the FDA on the activities of the Interagency Coordination Conference. China and the U.S. also agreed to continue the dialogue on pharmaceutical data protection.
• Travel and Tourism. The U.S. and China agreed to implement the second phase of the MOU that opened the market for the sale of packaged leisure travel from China to the U.S. to include an additional 12 jurisdictions, bringing the total to 21. The two sides will hold a high-level meeting of the JCCT Tourism Working Group in January 2010 to sign a programme of work that will enhance travel under the MOU.
• Miscellaneous. The U.S. and China also launched a new vice minister-level dialogue focused on innovation and industrial policy and agreed to: (1) continue anti-monopoly talks under the U.S. Trade and Development Agency; (2) hold a government-to-government exchange of information on dietary supplement regulation by 31 March 2010; (3) hold the second U.S.-China Environmental Industries Forum in October 2010 and a second U.S.-China E-Scrap Recycling Summit in May 2010; (4) hold a forum addressing the expansion of travel distribution services in mainland China, including computer reservation system technology; (5) hold a green building standards seminar by March 2010; (6) jointly hold a programme with public and private participants to discuss the issue of intermediary legal liability on the Internet and exchange information about handling bad faith trademark registration practices; (7) convene a public-private meeting by February 2010 on standards and conformity assessment procedures; and (8) continue co-operation on transparency and administrative rulemaking and formulate a 2009-2010 work plan to enhance transparency and predictability for market participants.