US and Chinese negotiators are trying to resolve a long-running dispute between semiconductor rivals Micron Technology and Fujian Jinhua as part of a larger trade agreement between the world’s two largest economies, according to people briefed on the negotiations.
The people added that a resolution of the various charges and counter-charges involving Micron and Fujian Jinhua was one of a series of “confidence-building” measures the two sides want to include in a memorandum of understanding, which could pave the way for a final agreement to the continuing US-China trade war.
Vice Premier Liu He, China’s lead negotiator, and US trade representative Robert Lighthizer are due to wrap up their third round of face-to-face trade talks in almost as many weeks on Friday in Washington, after which Mr Liu will meet US President Donald Trump.
The people briefed on the talks said concrete agreements on long-running commercial disputes could help Mr Trump sell a larger trade deal that may be light on difficult structural reforms of the Chinese economy and a stringent enforcement mechanism, both of which have been stubbornly resisted by Mr Liu’s team.
Other confidence-building measures under discussion include an easing of Chinese restrictions on imports of US polysilicon, a component of solar energy panels, which Beijing implemented in retaliation for US tariffs on imported solar cells.
In a tweet on Thursday, Mr Trump also indicated that he might be willing to reduce the pressure his administration has been putting on Huawei, the Chinese telecoms group, which could similarly help pave the way for a trade deal.
People briefed on the talks have said Chinese officials have asked for Washington and Beijing’s dispute over the company to be resolved in a “parallel track” to the trade negotiations.
President Xi Jinping is seeking the release of Meng Wanzhou, Huawei’s chief financial officer and the daughter of company founder Ren Zhengfei, who is in Canada pending her possible extradition to the US on charges of alleged bank fraud related to sanctions against Iran.
In response, the Chinese government has detained two Canadian nationals on national security charges.
The long-running feud between Micron, based in Idaho, and Fujian Jinhua, based in Fujian province, is regularly cited by US officials as an example of the Chinese government’s alleged failure to protect foreign investors’ technologies and other intellectual property.
At an Oval Office meeting late last month between Mr Trump and Mr Liu, Mr Lighthizer said the two negotiating teams were focused on “the most important issues” including “forced technology transfer, intellectual property protection . . . and enforcement, enforcement, enforcement”.
As their dispute escalated over the past year, Micron and Fujian Jinhua have received strong support from their respective governments.
The US Commerce Department banned US exports and technology transfers to Fujian Jinhua, in a measure that could force the company to stop production by next month.
In a separate case, the US Justice Department filed criminal charges against Fujian Jinhua for allegedly conspiring with Taiwan’s UMC to steal Micron’s technology.
Fujian Jinhua, UMC and the Chinese government have strenuously denied the charges.
For its part, Micron is the subject — alongside South Korean rivals Samsung Electronics and SK Hynix — of a Chinese government anti-monopoly investigation into alleged price-fixing. A Chinese court also moved last year to halt the sale of dozens of Micron products that Fujian Jinhua and UMC alleged had infringed on their patents.
Micron has denied the charges and appealed against the court decision, which it said was sought by Fujian Jinhua and UMC in retaliation for the three companies’ disputes.