China's Commerce Ministry on Thursday criticized a U.S. decision to launch a trade probe of Beijing's technology policy as an attack on the global trading system and said it will "resolutely defend" Chinese companies.
Trade groups welcomed President Donald Trump's Aug. 14 order to look into whether Beijing improperly requires companies to hand over technology as a condition of market access. U.S. Trade Representative Robert Lighthizer announced a formal investigation this week.
The action improperly applies U.S. law instead of international rules and is "the destruction of the existing international trade system," said a ministry spokesman, Gao Feng, at a news briefing.
"We are strongly dissatisfied with this unilateral and protectionist practice and will take all necessary measures to resolutely defend the legitimate rights and interests of the Chinese side and Chinese enterprises," said Gao.
Beijing requires automakers and other foreign companies in China to work through joint ventures, usually with state-owned partners. They often are required to give technology to partners that might become competitors.
More than 20 percent of 100 American companies that responded to a survey by the U.S.-China Business Council, an industry group, said they were asked to transfer technology within the past three years as a condition of market access.
Foreign business groups complain companies are being squeezed out of promising Chinese markets or pressured to hand over technology for electric cars and other emerging industries.
Trump said in April he was setting aside trade disputes while Washington and Beijing worked together to persuade North Korea to give up nuclear weapons development. But American officials have resumed criticizing Chinese policy in recent weeks.