U.S.-CHINA TRADE

United States Has 

Secured

Commitments in Key 

Bilateral Dialogues, 

but U.S. Agency 

Reporting on Status 

Should Be Improved

Report to Congressional Requesters

February 2014

GAO-14-102

United States Government Accountability Office
United States Government Accountability Office

Highlights of GAO-14-102, a report to 

congressional requesters

February 2014 

U.S.-CHINA TRADE

United States Has Secured Commitments in Key 

Bilateral Dialogues, but U.S. Agency Reporting on 

Status Should Be Improved

Why GAO Did This Study

China is the largest destination for U.S. 

exports outside North America and

also the source of the largest U.S. 

bilateral trade deficit. The countries 

engage in two high-level dialogues to 

address trade barriers and crosscutting economic issues. These are the 

JCCT, co-led for the United States by 

Commerce and USTR, and the 

economic track of the S&ED, led by 

Treasury. GAO was asked to review 

China’s bilateral trade commitments 

made in these dialogues. This report 

(1) describes trade and investment 

commitments China has made at the 

JCCT and S&ED; (2) describes U.S. 

agency tracking of China’s 

implementation of these commitments; 

and (3) evaluates U.S. agency 

reporting on implementation. GAO 

analyzed documents, including public 

fact sheets stating commitments; 

interviewed officials, industry 

representatives, and other experts; 

used a structured process to 

categorize commitments; and reviewed 

reports officials identified as reporting 

implementation status of commitments.

What GAO Recommends

To improve understanding of progress 

through the bilateral dialogues in 

increasing access to China’s markets, 

USTR, in conjunction with Commerce 

and Treasury, should work to improve 

reporting on China’s implementation of 

JCCT and S&ED trade and investment 

commitments. In written comments, 

USTR and Commerce did not directly 

agree or disagree with the 

recommendation, but raised several 

concerns. USTR maintained current 

reporting is comprehensive and 

Commerce noted resource constraints. 

GAO continues to believe improved 

reporting would benefit policymakers.

What GAO Found

GAO identified 298 trade and investment commitments made by China in the 

U.S.-China Joint Commission on Commerce and Trade (JCCT)—184 since 

2004—and the U.S.-China Strategic and Economic Dialogue (S&ED) and its 

predecessor—114 since 2007. The commitments range from affirmations of open 

trade principles to sector-specific actions. GAO identified 11 issue areas to 

characterize the content of each commitment. The prominence of issue areas, 

measured in number of commitments associated with an issue area, differs 

between the dialogues, reflecting differences in the dialogues’ structure and 

focus. Intellectual property rights commitments are among those most common 

in the JCCT and investment commitments are among those most common in the 

S&ED. (For a detailed inventory of commitments and their categorization, see 

GAO-14-224SP.)

U.S. Agency Roles in the JCCT and S&ED

U.S. agencies track commitment implementation through several means, 

including outreach to domestic stakeholders, issue-based working groups with 

China in the JCCT, and consultations in advance of S&ED annual meetings. No 

single document is used to track implementation, according to U.S. officials. In 

addition, although there have been calls to use metrics such as exports and 

sales in developing commitments, agencies identified only one such commitment 

in the dialogues and cited challenges in identifying appropriate data.

Although several reports on trade barriers present information on JCCT and 

S&ED commitments, information on commitment implementation in these reports 

does not provide a clear and comprehensive picture of progress across the 

dialogues. The Office of the U.S. Trade Representative (USTR) produces these 

reports with assistance from other agencies, including the Departments of 

Commerce (Commerce) and Treasury (Treasury). GAO’s analysis of 10 software 

commitments from 2008-2011 shows, for example, that the implementation 

status of most could not be clearly identified. More comprehensive reporting 

would give Congress and other policy makers a clearer understanding of 

progress and the role of the dialogues as they continue to assess challenges in 

the U.S.-China relationship.

View GAO-14-102. For more information, 

contact David Gootnick at (202) 512-3149 or 

gootnickd@gao.gov.
Page i GAO-14-102 China's Bilateral Trade Commitments

Letter 1 

Background 2

China Has Made Commitments in a Number of Trade and 

Investment Areas and Sectors 6

Agencies Use Various Means to Track Implementation 12

Lack of Comprehensive Information on Implementation of 

Commitments across Reports Limits Understanding of Progress 16

Conclusions 23

Recommendation for Executive Action 23

Agency Comments and Our Evaluation 24

Appendix I Objectives, Scope, and Methodology 26

Appendix II Comments from the Department of Commerce 35

Appendix III Comments from the Office of the U.S. Trade Representative 36

Appendix IV GAO Contact and Staff Acknowledgments 41

Tables

Table 1: Key Annual Reports Addressing Trade Barriers with 

China 18

Table 2: List of Issue Areas Identified in GAO’s Analysis of 

China’s JCCT Commitments (2004-2012) and S&ED 

Trade and Investment Commitments (2007-2013) 29

Figures

Figure 1: U.S. Agency Roles in the JCCT and S&ED 4

Figure 2: Issue Areas Identified within China’s JCCT 

Commitments (2004-2012) and S&ED Trade and 

Investment Commitments (2007-2013) 8

Contents
Page ii GAO-14-102 China's Bilateral Trade Commitments

Abbreviations

APEC Asia-Pacific Economic Cooperation

Commerce Department of Commerce

GPA Government Procurement Agreement of the World 

 Trade Organization

JCCT U.S.-China Joint Commission on Commerce and Trade

NTE National Trade Estimate Report on Foreign Trade 

 Barriers

OSTP Office of Science and Technology Policy

S&ED U.S.-China Strategic and Economic Dialogue

SED U.S.-China Strategic Economic Dialogue

State Department of State

Treasury Department of the Treasury

USDA U.S. Department of Agriculture

USTR Office of the U.S. Trade Representative

WTO World Trade Organization

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Page 1 GAO-14-102 China's Bilateral Trade Commitments

441 G St. N.W.

Washington, DC 20548

February 11, 2014

The Honorable Dana Rohrabacher

Chairman

Subcommittee on Europe, Eurasia, and Emerging Threats

Committee on Foreign Affairs

House of Representatives

The Honorable Frank Wolf

House of Representatives

The Honorable J. Randy Forbes

House of Representatives

Since China joined the World Trade Organization (WTO) in 2001, trade 

between the United States and China has grown substantially, with China 

now the largest destination for U.S. exports outside North America. 

However, U.S. imports from China exceed exports by more than $300 

billion, making the U.S. trade deficit with China significantly larger than 

with any other trading partner. Despite actions by China to open its 

markets to the United States, formidable barriers remain. The 

governments of the United States and China are engaged in a number of 

forums that address trade issues, including two cabinet-level bilateral 

dialogues—the U.S.-China Joint Commission on Commerce and Trade 

(JCCT) and the U.S.-China Strategic and Economic Dialogue (S&ED).

The JCCT, initiated in 1983, focuses on addressing bilateral trade matters 

and promoting commercial opportunities. The S&ED, established in 2009, 

represents the highest-level bilateral dialogue to discuss a broad range of 

both strategic and economic issues. (The S&ED was preceded by the 

Strategic Economic Dialogue [SED] in 2006 through 2008.) Some 

observers and policy makers have raised questions about what 

commitments China has made and implemented as a result of these 

dialogues as well as what tangible benefits for the U.S. economy the 

dialogues have produced.

You asked us to review issues related to China’s JCCT and S&ED trade 

and investment commitments. In this report, we (1) describe the 

commitments China made at the JCCT and the trade and investment 
 

Page 2 GAO-14-102 China's Bilateral Trade Commitments

commitments China made at the S&ED,1 (2) describe U.S. agency 

tracking of China’s implementation of these commitments, and 

(3) evaluate U.S. agency reporting on the status of commitment 

implementation.

To address these objectives, we analyzed documents and interviewed 

U.S. officials, industry representatives, and other experts. To describe the 

commitments, we analyzed public JCCT and S&ED fact sheets issued by 

the U.S. government to identify individual commitments made by China, 

including those made jointly with the United States, and categorized them 

by trade issue areas using a structured review process.2 To describe U.S. 

agency tracking of commitment implementation, we obtained and 

analyzed documentary and testimonial evidence on relevant agency 

activities. To evaluate U.S. agency reporting on implementation status, 

we reviewed key reports that U.S. officials identified as containing their 

assessments of the implementation of commitments made in these 

dialogues, and discussed the results with officials and other experts. 

(Appendix I provides more detailed information on our scope and 

methodology.) In addition, an inventory of the commitments we identified 

and their categorization by issue area is provided in an online esupplement, GAO-14-224SP. 

We conducted this performance audit from May 2012 to February 2014 in 

accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.

Since 1979, when the United States and China signed a bilateral trade 

agreement, China’s economy has grown at an unprecedented rate, as 

has China’s bilateral economic engagement with the United States. In 

 

1

For simplicity of exposition, when we refer to “trade and investment commitments China 

made at the S&ED” we mean commitments made by China in the SED in 2007 and 2008 

and in the S&ED from 2009 through 2013.

2

According to senior officials from the Department of Commerce, Office of the U.S. Trade 

Representative, and the Department of the Treasury, the commitments presented in the 

fact sheets are the official commitments negotiated with the Chinese government.

Background
 

Page 3 GAO-14-102 China's Bilateral Trade Commitments

recent years, China’s economy grew an average of 10 percent a year, 

and in 2010 China replaced Japan as the world’s second largest 

economy. Total U.S.-China trade increased from $2 billion in 1979 to 

$536 billion in 2012. China is currently the second largest U.S. trading 

partner, the third largest U.S. export market, and the largest source of 

U.S. imports.

The governments of the United States and China have established two 

important bilateral dialogues—the JCCT and S&ED, which discuss and 

resolve trade and investment matters, including reducing trade barriers 

for U.S. firms and investors.3 (See figure 1 for the organization of the 

JCCT and the S&ED.) According to senior U.S. officials, the United States 

also engages with China at all levels of government in other bilateral 

interactions, such as formal and informal conversations at U.S.-China 

summits. In addition, the two governments discuss trade and investment 

issues in multilateral forums, such as the WTO and the Asia-Pacific 

Economic Cooperation (APEC) forum.4

 

3

According to the Office of the U.S. Trade Representative, trade barriers, broadly defined, 

are government laws, regulations, policies, or practices that either protect domestic goods 

and services from foreign competition, artificially stimulate exports of particular domestic 

goods and services, or fail to provide adequate and effective protection of intellectual 

property rights.

4

APEC is the primary economic forum in the Asia-Pacific region. Established in 1989 and 

comprising 21 member economies, including the United States, APEC aims to facilitate 

economic cooperation and to expand trade and investment throughout the region. WTO 

standing committees are issue-based groups that meet regularly to permit WTO members 

to exchange views, work to resolve questions of members’ compliance with commitments, 

and develop initiatives aimed at systemic improvements.
 

Page 4 GAO-14-102 China's Bilateral Trade Commitments

Figure 1: U.S. Agency Roles in the JCCT and S&ED

Note: On the U.S. side, the Department of Agriculture and the Office of the U.S. Trade 

Representative (USTR) co-chair the agriculture working group and the sanitary and phytosanitary 

working group, the Environmental Protection Agency and Commerce co-chair the environment 

working group, and Commerce and USTR chair or co-chair the remaining working groups.

The JCCT, established in 1983, is the main bilateral dialogue for 

addressing trade matters and promoting commercial opportunities 

between the two countries. Since 2004, the U.S. Secretary of Commerce, 

the U.S. Trade Representative, and China’s Vice Premier for foreign trade 

have co-chaired the JCCT.5 The dialogue, which has multiple working 

groups focusing on specific issue areas, operates year-round and 

culminates in an annual plenary meeting that alternates between the 

United States and China. The two most recent JCCT plenary meetings 

took place in December 2012 in Washington, D.C., and in December 

2013 in Beijing, China.

The S&ED, established by the Presidents of the United States and China 

in April 2009, represents the highest-level bilateral dialogue to discuss a 

broad range of issues between the two nations. The S&ED addresses 

 

5

The JCCT was co-chaired by the U.S. Secretary of Commerce and China’s Minister of 

Commerce from 1983 through 2003, when the two sides agreed to elevate the dialogue’s 

leadership in order to address high priority trade issues more effectively.
 

Page 5 GAO-14-102 China's Bilateral Trade Commitments

bilateral, regional, and global economic and strategic issues, both 

medium and longer term. Under the S&ED, the two sides meet once a 

year, alternating between Washington, D.C., and Beijing. The fifth S&ED 

meeting was held in Washington, D.C., in July 2013. The S&ED has 

strategic and economic tracks; the U.S. Secretary of State and China’s 

State Councilor for foreign affairs co-chair the strategic track, and the 

U.S. Treasury Secretary and China’s Vice Premier for foreign trade cochair the economic track. From 2006 through 2008, the S&ED was 

preceded by the SED, in which the two governments discussed the most 

important economic, but not political, issues in the bilateral relationship.

The S&ED’s economic track has four pillars, one of which focuses on 

trade and investment,6 and addresses short, medium, and longer term 

economic issues. In setting S&ED priorities, the Department of the 

Treasury (Treasury) and the National Security Staff lead an interagency 

process, working closely with the Department of Commerce (Commerce), 

the Office of the U.S. Trade Representative (USTR), and other agencies, 

on trade and investment issues. According to Treasury officials, 

discussions of S&ED economic track issues continue throughout the year 

between the annual plenary meetings.

Agencies report the outcomes of the JCCT and S&ED dialogues through 

public statements in the form of fact sheets that present commitments 

made by the United States and China. These fact sheets are issued 

following the conclusion of the JCCT and S&ED annual meetings. 

Commerce and USTR issue a JCCT fact sheet following the JCCT annual 

meeting; Treasury issues jointly with China an S&ED fact sheet for the 

economic track that presents the joint commitments negotiated by the 

United States and China following the S&ED annual meeting. Treasury 

also issues a U.S. fact sheet that discusses the benefits of the 

commitments for U.S. workers and companies. The Department of State 

(State) issues the fact sheet for the S&ED strategic track. According to 

senior U.S. agency officials, these fact sheets outline the official 

commitments negotiated with the Chinese government.

In addition to reporting commitments, the JCCT and S&ED fact sheets 

have in recent years included sections that identify cooperative or 

 

6

The other three pillars of the S&ED’s economic track focus on macroeconomic 

cooperation, global economic governance, and financial markets. The United States and 

China discuss financial services trade issues under the financial markets pillar.
 

Page 6 GAO-14-102 China's Bilateral Trade Commitments

exchange activities between the United States and China.7 (These are 

referred to as “cooperative activities” in JCCT fact sheets and 

“institutional arrangements” in S&ED fact sheets.) According to 

Commerce officials, JCCT cooperative activities are undertaken with the 

goal of advancing U.S. priorities and are often crucial for developing 

successful policy commitments from China. They may involve discussions 

with public and private sector participants focusing on issues or areas at 

the pre-commitment level. For example, in 2009, China and the United 

States held a program, pursuant to JCCT commitments, with public and 

private participants to discuss legal liability for intellectual property rights 

infringement that occurs on the Internet. There were JCCT commitments 

related to this issue in 2010 and 2012 that resulted, according to U.S. 

officials, in the Supreme People’s Court’s publication of a judicial 

interpretation stating that those who facilitate online infringement will be 

held jointly liable for that conduct. Similarly, the S&ED allows for activities, 

such as consultations or technical exchanges, that are separate from 

commitments but allow the two sides to engage in a dialogue on a range 

of issues. For example, in 2012 the United States and China agreed to 

expand technical exchanges under the U.S.-China Transportation Forum 

and enhance coordination under the APEC framework.

China has made 298 trade and investment commitments since 2004 in 

the JCCT and S&ED, ranging from statements affirming open trade 

principles to statements that focus on trade actions specific to a sector.8

The prominence of issue areas across the commitments differs between 

the dialogues, reflecting differences in the dialogues’ structure and focus.

Some commitments reaffirm prior commitments and some commitments 

acknowledge progress since the previous year’s meeting.

 

7

Some commitments that are not presented in the fact sheets as “cooperative activities” 

also focus on cooperation. For example, a commitment in the 2010 JCCT fact sheet states 

that China and the United States agreed to work closely to cooperate and conduct 

information exchange concerning counterfeit drug activities and agreed to provide 

information about cases of counterfeit drugs through regulatory channels.

8

The “S&ED commitments” in our analysis refer to trade and investment commitments 

China made at the S&ED and its predecessor, SED. They do not include S&ED strategic 

track commitments or economic commitments outside of the trade and investment pillar.

China Has Made 

Commitments in a 

Number of Trade and 

Investment Areas and 

Sectors
 

Page 7 GAO-14-102 China's Bilateral Trade Commitments

We identified 184 commitments in the JCCT since 2004 and 114 trade 

and investment commitments in the S&ED since 2007 that involve China 

or China and the United States.9 The commitments include statements 

affirming open trade principles, statements of policy intent, and 

statements that focus on trade actions specific to a sector. U.S. officials 

stressed that not all commitments are of equal value and significance.10

We examined the JCCT and S&ED commitments to provide an overview 

of their areas of emphasis and other characteristics. We identified 11 

issue areas to characterize the content of each commitment, including 

sector-specific issues. Fifty-four percent of the JCCT commitments and 

48 percent of the S&ED trade and investment commitments were related 

to two or three issue areas. See figure 2 for the list of issue areas and 

number of commitments related to each issue area. Table 2 in appendix I 

describes each issue area and provides examples of commitments.

 

9

We excluded commitments that involved only the United States.

10Our analysis does not address the relative significance of the commitments.

Prominent Issue Areas 

Include Intellectual 

Property Rights for JCCT 

Commitments and 

Investment for S&ED 

Trade and Investment 

Commitments
 

Page 8 GAO-14-102 China's Bilateral Trade Commitments

Figure 2: Issue Areas Identified within China’s JCCT Commitments (2004-2012) and S&ED Trade and Investment 

Commitments (2007-2013)

Note: We categorized commitments that did not fit the 11 issue areas as “other.” We assigned up to 

three issue areas to each commitment because many commitments were related to more than one 

issue area. Thus, the numbers shown in this figure exceed the total number of commitments we 

identified for each dialogue, 184 commitments for the JCCT and 114 trade and investment 

commitments for the S&ED. See GAO-14-224SP for a full inventory of commitments and their 

categorization.
 

Page 9 GAO-14-102 China's Bilateral Trade Commitments

At the JCCT, a large share of commitments are related to intellectual 

property rights (62 commitments or 34 percent)11 and technical and 

regulatory barriers to trade (45 commitments or 24 percent). China has 

made commitments related to both of these issue areas every year since 

2004, with at least 20 percent of commitments related to intellectual 

property rights and at least 10 percent of commitments related to 

technical and regulatory barriers to trade. In addition, 110 commitments 

(or 60 percent of all China’s JCCT commitments) refer to a specific 

sector, including 28 commitments related to pharmaceuticals and medical 

devices, 19 commitments related to agriculture, and 18 commitments 

related to software use.12

For the S&ED, 70 percent of the trade and investment commitments are 

related to one or more of the following three issue areas: investment (30 

commitments or 26 percent), multilateral issues (26 commitments or 23 

percent), and transparency (24 commitments or 21 percent).

Differences in the number of commitments associated with specific issue 

areas across the two dialogues may reflect differences in the dialogues’ 

structure and focus. According to U.S. officials, the JCCT has had greater 

focus on bilateral trade issues and sectors, in contrast with the S&ED, 

where trade and investment issues have been discussed within a broader 

range of economic and strategic issues. In addition, our analysis shows 

that statements of joint actions by China and the United States are more 

common at the S&ED (75 percent). According to Treasury officials, this 

reflects the broad economic focus and cross-cutting discussions of the 

S&ED’s economic track. The majority of China’s JCCT commitments (76 

percent) involve China alone.

Commitments in the two dialogues generally do not specify timeframes 

although according to U.S. officials, many commitments are either 

expected to be implemented by the next annual meeting or are 

considered to be ongoing. According to Commerce officials, that would be 

 

11As defined in the WTO’s Agreement on Trade-Related Aspects of Intellectual Property 

Rights, intellectual property rights include copyright and related rights as well as protection 

of trademarks, geographical indications, industrial designs, patents, integrated circuit 

layout-designs, and undisclosed information, including trade secrets.

12If the same commitment was made repeatedly in different years, we counted it as a 

separate commitment in each year.

Expected Timeframes of 

Commitment 

Implementation
 

Page 10 GAO-14-102 China's Bilateral Trade Commitments

the case, for example, for a commitment by China to provide fair 

treatment to foreign investors.13 According to Treasury officials, in the 

S&ED the two sides work under the general assumption, unless stated 

otherwise, that each year’s S&ED commitments are to be implemented by 

the next S&ED meeting.14 Some JCCT and S&ED commitments do 

specify a timeframe. Of the commitments we identified, timeframes were 

specified in 17 percent of China’s 184 JCCT commitments and 18 percent 

of China’s 114 S&ED trade and investment commitments. For example, 

at the 2011 JCCT meeting, China agreed to publish procedures for 

telecommunications network access license and radio type approval by 

the end of 2011. At the 2013 S&ED meeting, China committed to submit a 

new revised offer to join the WTO’s Government Procurement Agreement 

(GPA) by the end of 2013.15

Our analysis shows continuity of issues and objectives pursued at the two 

dialogues from 2004 through 2013. Some specific commitments have 

been made repeatedly, while others have evolved.

Within S&ED issue areas, some commitments have been reaffirmed over 

time. For example, in investment—which is associated with 26 percent of 

China’s S&ED trade and investment commitments—the United States 

and China committed to bilateral investment treaty negotiations each 

year, with commitments becoming increasingly specific. The 2013 

commitment stated that the bilateral investment treaty will provide 

 

13Commerce officials further noted that U.S. understanding of when commitments are to 

be implemented is shaped by the larger context of those commitments. For example, 

these officials observed that China’s legislative calendar has a bearing on the U.S. 

government’s understanding of when China is to implement legislative changes discussed 

in JCCT commitments.

14The joint 2013 S&ED fact sheet explicitly stated that “[t]he two countries reached 

consensus to work expeditiously to implement the commitments made and, as the Special 

Representatives of the Economic Track, directed their respective economic teams to take 

concrete steps before the next Strategic and Economic Dialogue to do so.” 

15The GPA is a plurilateral agreement that currently covers the United States and 41 other 

WTO members. China is not yet a party to the GPA. The agreement requires GPA parties 

to provide most-favored-nation and national treatment to the goods, services and 

suppliers of other GPA parties and to conduct their procurement in accordance with 

procedures designed to ensure transparency, fairness and predictability in the 

procurement process. China has committed in its WTO accession agreement that all of its 

central and local government entities will conduct their procurements in a transparent 

manner until China completes its accession to the GPA.

Some Commitments Have 

Been Reaffirmed and 

Others Have Evolved
 

Page 11 GAO-14-102 China's Bilateral Trade Commitments

national treatment at all phases of investment, including market access 

(“pre-establishment”), and be negotiated under a “negative list” 

approach.”

16 In another example, China repeatedly affirmed its intent to 

follow the generally accepted principles and practices of sovereign wealth 

funds.

Other commitments illustrate how efforts to address trade barriers in an 

issue area or sector have evolved over time. For example, the United 

States has secured multiple commitments in both the JCCT and S&ED 

concerning the terms under which China will accede to the GPA. These 

have become increasingly specific, moving from initially seeking China’s 

commitment to submit a revised accession offer to subsequently seeking 

commitments related to the specific elements of such an offer. USTR 

reported U.S. concerns with each offer in its annual National Trade 

Estimate Reports on Foreign Trade Barriers (NTE) for 2011 through 

2013:

• At the May 2010 S&ED, China committed to submit a revised offer to 

accede to the GPA by July of that year, which it did. However, USTR 

reported that China could improve its next offer by, among other 

things, including sub-central entities and certain state-owned 

enterprises.

• At the December 2010 JCCT, China committed to submit a second 

revised offer—whose content would be based on intra-governmental 

consultations on the entities to be subject to the agreement—to join 

the GPA before the WTO Committee on Government Procurement’s 

final meeting in 2011. USTR reported that China submitted the offer 

but that it excluded too many state-owned enterprises.

• At the May 2012 S&ED, China committed to submit a new 

comprehensive revised offer that responded to the requests of the 

 

16Pre-establishment refers to the entry of investments and investors of one member 

country of a trade or investment agreement into the territory of another. Each member 

country allows investors of other member countries to establish an investment in their 

territory on terms no less favorable than those that apply to domestic investors (national 

treatment) or investors from third countries (most-favored-nation treatment). Preestablishment is rarely granted without exceptions since every country has sensitive 

sectors where foreign investment is not permitted. A negative list approach requires that 

discriminatory measures affecting all included sectors of a trade or investment agreement 

be liberalized unless specific measures are set out in the list of reservations.
 

Page 12 GAO-14-102 China's Bilateral Trade Commitments

GPA parties to the WTO Committee on Government Procurement 

before the committee’s final meeting in 2012. China submitted its third 

revised offer in November 2012.

China’s commitments in software have also evolved over time. We 

identified 22 software-related commitments—18 in the JCCT beginning in 

2004 and 4 in the S&ED beginning in 2011. In 2004, China committed to 

extend an existing ban on the use of pirated software in central and local 

governments. This commitment continued in subsequent years with the 

inclusion of state-owned enterprises in 2006. In 2010, China committed to 

establish software asset management systems for government agencies 

and to allocate budgetary funds for purchasing, upgrading, and replacing 

agency software, and in 2012, China confirmed that it required stateowned enterprises to use legitimate software. In the S&ED, China 

committed to strengthening inspections to ensure legitimate government 

software use in 2011 and to extending software management pilot 

projects to the enterprise sector in 2012.

U.S. agencies track the implementation of commitments through various 

means including interactions with their Chinese counterparts and 

outreach to industry. U.S. agencies identified JCCT working groups and 

mid-year reviews, discussions with Chinese officials while developing joint 

fact sheets prior to S&ED meetings, U.S. industry associations and 

companies, and U.S. officials based in China as key sources for 

information on progress. U.S. agencies use several tracking documents 

that capture information on the status of some commitments over time 

and do not have a single document that encompasses either dialogue. In 

addition, U.S. agencies have sought to identify commercial metrics such 

as increased sales to use as indicators of implementation progress where 

possible, but cited challenges in identifying appropriate data.

U.S. agencies collect information on the status of commitment 

implementation through several means, including ongoing engagement 

with their Chinese counterparts in preparation for meetings, and regular 

outreach to domestic stakeholders. One important source of tracking 

information is the 16 JCCT working groups. The working groups each 

comprise U.S. and Chinese officials; some focus on specific industries, 

such as steel, and some on trade issues such as intellectual property. 

According to U.S. agency officials and documents, the JCCT has added 

working groups in response to changes in the trade relationship—for 

example, adding the Trade and Investment Working Group which covers 

Agencies Use Various 

Means to Track 

Implementation

U.S. Agencies Track 

Information on 

Implementation through 

Several Means
 

Page 13 GAO-14-102 China's Bilateral Trade Commitments

a range of trade and investment issues.17 U.S. agencies obtain updated 

information on implementation status from their Chinese counterparts at 

working group meetings. For example, Commerce and USTR officials 

received information from working group meetings about Chinese actions 

taken to shut down websites selling counterfeit medicines, in response to 

2010 and 2011 JCCT commitments. Intellectual Property Rights working 

group officials stated that their working group has been instrumental in 

following the implementation of commitments to reduce end-user piracy of 

software by government agencies and state-owned enterprises.

The Office of Science and Technology Policy (OSTP) tracks 

implementation of commitments China makes at the Innovation Dialogue 

which are part of the overall S&ED commitments. Established in 2010 at 

the request of the U.S. and Chinese leaders of the S&ED, the Innovation 

Dialogue is a forum to share best practices in promoting innovation.18 The 

dialogue established a working group of U.S. and Chinese private sector 

experts and government officials, which monitors implementation of 

commitments and advises on barriers to successful implementation.19

U.S. government officials also analyze commitment implementation while 

preparing the joint fact sheet for the coming year’s S&ED plenary 

meeting, according to Treasury officials. Treasury solicits and compiles 

input from key U.S. federal agencies on their priorities, which it 

exchanges with its Chinese counterparts. They then negotiate the 

wording of the joint fact sheet. This process can identify information on 

the status of past commitments, as well as in some cases on follow-on 

commitments. USTR and Treasury officials stated that participants 

actively negotiate JCCT commitment language immediately before and

during the JCCT plenary meetings, and Treasury officials said that joint 

 

17The groups are active to varying degrees; the Intellectual Property Rights working group 

meets twice a year while the Steel Dialogue has met four times since its creation in 2005.

18The Innovation Dialogue is led by the Director of the U.S. Office of Science and 

Technology Policy and China’s Minister of Science and Technology.

19This dialogue has also resulted in negotiation of new commitments. In a commitment 

reported in the 2012 S&ED fact sheet, and negotiated in the Innovation Dialogue, China 

committed to treat intellectual property owned or developed in other countries in the same 

manner as intellectual property owned or developed in China. According to OSTP officials, 

following concerns raised by the private sector concerning tax preferences that appeared 

to favor Chinese firms, the Innovation Dialogue negotiated a new commitment by China to 

review these preferences.
 

Page 14 GAO-14-102 China's Bilateral Trade Commitments

fact sheet language is also actively discussed during the time of the 

S&ED plenary meetings.

In addition, in 2010, the United States and China instituted a mid-year 

review within the JCCT as an additional tool to track commitment 

implementation and to prepare for annual plenary meetings. According to 

a USTR official and our review of mid-year review agendas, the review 

focuses on selected priority commitments from the previous year and 

proposing outcomes for the upcoming plenary.

U.S. officials observed that discussions of the status of particular 

commitments take place across a wide range of settings aside from those 

directly related to the JCCT and S&ED. Treasury officials stated that they 

follow up on the implementation of certain types of S&ED commitments in 

various meetings with their Chinese counterparts, citing government 

procurement issues as particularly relevant for discussions with their 

counterparts at the Ministry of Finance, which leads on the issue. One

agency cited mechanisms for engaging their Chinese counterparts, such 

as memoranda of understanding with provisions related to 

implementation of JCCT commitments. U.S. reports cited forums such as 

WTO standing committees and the APEC forum as examples of meetings 

where JCCT and S&ED trade and investment commitment 

implementation may be discussed. For example, according to WTO 

documents, China reported to the WTO Committee on Government 

Procurement that it expected to submit a revised offer on government 

procurement to the committee before the end of 2013, consistent with its 

2013 S&ED commitment.

U.S. agencies obtain information on implementation status from U.S. 

industry and U.S. officials abroad. U.S. officials based in Washington told 

us they work with U.S. industry associations and companies in developing 

information on an ongoing basis on China’s implementation progress. For 

example, USTR solicits written submissions from interested parties 

through the issuance of Federal Register notices issued in conjunction 

with the preparation of annual mandated reports. U.S. officials based in 

China provide information on implementation status in reporting to 

headquarters while preparing annual mandated reports on trade issues, 

such as the Special 301 Report (on intellectual property rights protection) 

and the NTE. Embassy staff submits cables on key issues that include 

discussions of the status of trade barriers raised in the JCCT. U.S. 

officials serving in China obtain feedback from industry representatives 

based in that country. For example, locally based industry representatives 

provided information to U.S. embassy officials that China had effectively 
 

Page 15 GAO-14-102 China's Bilateral Trade Commitments

implemented a 2009 JCCT commitment to eliminate redundant medical 

device product recall regulations. According to Treasury officials, they 

regularly solicit government and industry sources for information on 

S&ED priorities in preparation of and after each dialogue.

U.S. agency officials stated that they use various documents to track the 

status of implementation over time and that there is no single, 

consolidated document or system that captures the status of 

implementation of JCCT or S&ED commitments. USTR officials said that 

the preparation of documents used to brief senior officials in advance of 

formal meetings—such as annual plenary meetings, mid-term reviews, 

and ad hoc high level meetings between U.S. and Chinese officials—is 

one of the processes used for tracking the status of implementation. 

According to representatives of the JCCT’s Intellectual Property Rights 

working group, briefing papers, together with other sources, also serve as 

a useful record of the status of implementation, and can help to facilitate 

knowledge transfer in the event of personnel turnover.

According to Commerce officials, a Commerce staff person, designated to 

help coordinate Commerce’s JCCT activities, maintained a spreadsheet 

for the official’s own use in tracking follow-up on China’s JCCT 

commitments. The official used the spreadsheet to identify actions taken 

on the commitments made in the current year and to facilitate briefing 

senior officials in advance of meetings. Commerce officials stated that 

this spreadsheet is not an interagency document and does not constitute 

a department or interagency position on the status of implementation of 

commitments.20

Some policymakers and private sector representatives have asked the 

administration to use commercial metrics (e.g., exports and sales) to track 

commitment implementation where possible. According to a senior 

agency official, framing commitments in terms of commercial results such 

as increased sales can focus attention on the ultimate goal of increased 

exports rather than on individual trade barriers, which may be removed 

but replaced by different trade barriers.

 

20As an example of a different tracking approach, State Department officials stated that 

they do use a single spreadsheet to track the status of commitments made in the strategic 

track of the S&ED. They cited a document they maintain which has in the past been 

shared with officials at other agencies. 

Various Documents Track 

Separate Aspects of 

Implementation Status

Agencies Generally Have 

Not Used Commercial 

Metrics to Track 

Implementation of 

Commitments
 

Page 16 GAO-14-102 China's Bilateral Trade Commitments

Although agency officials identified one JCCT or S&ED commitment 

directly linking a commercial metric (increased sales) to implementation, 

they cited the difficulty in identifying appropriate commercial metrics 

generally. In a 2012 S&ED commitment concerning intellectual propertyintensive industries, the United States and China committed to create 

environments for their respective markets in which the level of sales of

legitimate intellectual property-intensive products and services would 

increase in line with the two countries’ status as globally significant 

producers and consumers.21 In addition, officials indicated that it is easier 

to measure implementation of commitments that entail concrete and 

transparent legal actions – such as enactment of a law or other measure, 

or accession to a treaty – than to measure implementation of 

commitments to reaffirm existing policies or to a general policy direction.

USTR includes information in nine reports on trade barriers generally and 

efforts to address them, but does not provide comprehensive information 

to Congress and the public on the status of implementation of JCCT and 

S&ED trade and investment commitments. The reports focus on various 

aspects of trade barriers and market access and have different areas of 

focus and structures. Our analysis of selected commitments indicated that 

reporting on implementation status is not comprehensive because the 

reports are sometimes not clear and complete. This lack of 

comprehensive information makes it more difficult for policymakers to 

understand the progress made by the implementation of these 

commitments in removing trade barriers. 

 

21In 2012, Commerce identified the industries that most intensively use patents and 

trademarks as well as those responsible for most of the creation and production of 

copyrighted materials. Commerce defined the 75 industries that were the most patent, 

trademark, and copyright intensive as “intellectual property-intensive.” 

Lack of 

Comprehensive 

Information on 

Implementation of 

Commitments across 

Reports Limits 

Understanding of 

Progress
 

Page 17 GAO-14-102 China's Bilateral Trade Commitments

USTR reports on the status of trade barriers and market access broadly 

through nine reports, which it identified as the source for public 

information on JCCT and S&ED commitment implementation.22 In its 

strategic plan for fiscal years 2013 through 2016, USTR identifies these 

reports as important for building congressional support for the 

administration’s trade agenda by helping Congress gain a comprehensive 

understanding of the efforts the administration undertakes to dismantle 

trade barriers.23 Further, it characterized the reports as important to the 

agency’s commitment to transparency and accountability to Congress 

and stakeholders. In addition, the administration has identified the work of 

these bilateral dialogues in removing trade barriers in China as critical to 

the success of the national goal of doubling exports by the end of 2014.

The nine reports respond to statutory requirements and have different 

focuses and structures.24 The China WTO Compliance report, the only 

one focusing solely on China trade issues, examines the status of 

commitments made by China in connection with its accession to the 

WTO. Since 2008, the China WTO Compliance report has included a 

section on bilateral engagement that describes the outcomes for the 

present year; information on the status of past commitments is not 

included in that section but can be found in other sections of the report. 

Others among the nine reports have a worldwide scope and may include 

information on a specific sector, trade barrier, or policy area, including 

information on China and on the JCCT and S&ED commitments where 

appropriate. Section 1377 Review of Telecommunications Agreements, 

for example, focuses on trade barriers in a specific sector and the NTE 

 

22Specifically, USTR states that, collectively, the reports identify the major trade barriers to 

U.S. exports and the administration’s efforts to dismantle them through negotiation, 

consultation, and dispute settlement. The JCCT and the S&ED are bilateral consultative 

mechanisms.

23While USTR is statutorily mandated to report on the status of trade barriers and market 

access, it is not required to report on the status of implementation of JCCT and S&ED 

commitments.

24The number of reports responding to specific requirements has changed over time. For 

example, until 2010, the administration met the requirement for the National Trade 

Estimate Report on Foreign Trade Barriers with one report. Since then it has responded 

with three reports (Report on Sanitary and Phytosanitary Measures, NTE, and Report on 

Technical Barriers to Trade). Additionally, the administration addressed a reporting 

requirement on greenhouse gas technologies with stand-alone reports in 2006 and 2007 

and subsequently addressed the requirement with an appendix to the NTE report.

USTR Describes JCCT 

and S&ED Commitment 

Implementation Status in 

Several Trade-Related 

Reports
 

Page 18 GAO-14-102 China's Bilateral Trade Commitments

identifies key barriers to U.S. trade and describes barriers in a number of 

countries. Table 1 provides an overview of the nine reports.

Table 1: Key Annual Reports Addressing Trade Barriers with China

Report Subject Structure 

Year first 

issued

Report to Congress on 

China’s WTO Compliance

Reports annually on China’s progress in 

complying with commitments made in 

connection with its accession to the WTO. 

The report also describes U.S. efforts to 

reduce trade barriers with China through 

bilateral and multilateral forums, U.S. 

enforcement actions, and priority issues.

Divides China’s WTO commitments into 

9 broad categories, including trading 

rights, services, and agriculture.a

The only one of the nine reports that 

focuses on China.

2002

National Trade Estimate 

Report on Foreign Trade 

Barriers

Identifies the most important foreign barriers 

to U.S. trade and provides some information 

on some of the actions taken to eliminate 

them.

Is organized by country and by nine 

categories including import policies, 

government procurement, intellectual 

property rights, and investment 

barriers.b

1985

Special 301 Report Identifies trade barriers related to intellectual 

property rights and categorizes countries 

according to three levels of concern, with 

Priority Foreign Country designating the 

highest level.c China has been on the 

Priority Watch List since 2005. 

Provides overview of global intellectual 

property issues and trends and also 

country-specific trends.d

According to USTR, elements of an 

action plan are included in the 

Intellectual Property Rights working 

group discussions of the JCCT.e

1989

Section 1377 Review of 

Telecommunications 

Agreements

Indentifies trade barriers related to 

compliance with trade agreements relevant 

to the telecommunications sector (e.g., 

General Agreement on Tariffs and Trade).

Has focused on issues such as limits on 

foreign investment, competition.

Not organized by country.

1989

Report on Technical 

Barriers to Trade

Identifies standards-related barriers to U.S. 

exports; provides a focal point for U.S. 

efforts to resolve standards-related barriers; 

and documents actions underway.f

Includes general information on 

standards-related measures and 

chapters on each of 17 countries, plus 

the European Union. Identifies the JCCT 

as a key bilateral forum to resolve 

standards-related issues.

2010

Report on Sanitary and 

Phytosanitary Measures

Identifies sanitary and phytosanitary barriers 

to U.S. exports; provides a focal point for 

U.S. efforts to resolve standards-related 

barriers; documents the actions underway.g

Describes unwarranted measures and

explains why they impose barriers to 

trade, and how the United States is 

seeking to address them.

2010

Subsidies Enforcement 

Annual Report to the 

Congress

Describes the activities of the U.S. subsidies 

enforcement program.

Describes multilateral subsidy 

negotiations and ongoing enforcement 

and monitoring; report includes a 

section on China’s WTO subsidy 

notification obligations.

1996

Trade Policy Agenda and 

Annual Report of the 

President of the United 

States on the Trade 

Agreements Program

Provides an update on the trade 

agreements program and articulates the 

national trade policy agenda for that year.h

Describes the President’s trade agenda 

for coming year and reports on last 

year’s activities. Includes discussions for 

specific regions and countries.

1957
 

Page 19 GAO-14-102 China's Bilateral Trade Commitments

Report Subject Structure 

Year first 

issued

Report by the Office of the 

United States Trade 

Representative on TradeRelated Barriers to the 

Export of Greenhouse Gas 

Intensity Reducing 

Technologies 

Provides an update on the progress made in 

removing the trade barriers that U.S. 

exporters of green technologies face in the 

top 25 greenhouse gas emitting developing 

countries. The report also aims to describe 

U.S. efforts to reduce these barriers.

Since 2008, report has appeared as an 

appendix to the NTE report. For specific 

trade barriers in top emitting developing 

countries—which include China—see 

relevant sections of the NTE and 

Special 301 reports.

2006

Source: cited reports, the Office of the U.S. Trade Representative.

Notes:

a

These categories are (1) trading rights, (2) services, (3) import regulation, (4) export regulation, (5) 

internal policies affecting trade, (6) investment, (7) agriculture, (8) intellectual property rights, ( and (9) 

legal framework.

b

The nine categories are: (1) import policies, (2) government procurement, (3) export subsidies, (4) 

lack of intellectual property protection, (5) service barriers, (6) investment barriers, (7) governmenttolerated anti-competitive conduct, (8) trade restrictions affecting electronic commerce, and (9) other 

barriers. Other barriers are those that encompass more than one category (e.g., transparency) or 

affect a single sector).

c

USTR indicates concern with a trade barrier related to intellectual property rights by placing countries 

on a “Priority Watch List” or “Watch List.” The United States focuses its bilateral diplomatic efforts to 

improve intellectual property rights protection on Priority Watch List designees. Those countries that 

have the most egregious policies, acts, or practices with respect to intellectual property rights 

protection are designated as “Priority Foreign Countries.” 

d

USTR stated that the China section of the Special 301 report is the most comprehensive in the report 

and provides a means to track progress on issues.

e

The United States develops action plans and similar programs to address intellectual property rights 

issues in various contexts, including the Special 301 process. According to USTR, these plans and 

programs establish benchmarks, such as legislative, policy, or regulatory action by which to measure 

progress in improving intellectual property rights protection. In May 2011, USTR invited any country 

appearing on the Special 301 Priority Watch List or Watch List to negotiate a mutually agreed action

plan designed to lead to that country’s removal from the relevant list.

f

According to the introduction to the report, standards-related measures are documents and 

procedures that set out specific technical or other requirements for products or processes as well as 

procedures to ensure that these requirements are met.

g

Sanitary and phytosanitary measures, which are measures that governments apply to protect 

human, animal, or plant life or health from risks arising from the entry or spread of plant- or animalborne pests or diseases, or from additives, contaminants, toxins, or disease-causing organisms in 

foods, beverages, or feedstuffs.

h

According to the International Trade Commission, “the trade agreements program includes ‘all 

activities consisting of, or related to, the administration of international agreements which primarily 

concern trade and which are concluded pursuant to the authority vested in the President by the 

Constitution’ and congressional legislation.” 

USTR officials told us that the WTO Compliance report is the primary 

report on the status of the implementation of commitments, and the other 

eight reports contain additional information on some commitments. USTR 

prepares these nine reports with assistance from Commerce, Treasury, 
 

Page 20 GAO-14-102 China's Bilateral Trade Commitments

and other agencies on the Trade Policy Staff Committee.25 Such 

assistance includes reporting from U.S. embassies, reviewing drafts to 

ensure accuracy and, in the case of the China WTO Compliance and 

Special 301 reports, holding public hearings to obtain private sector 

views. For instance, a senior Treasury official told us that Treasury 

participates in the preparation of the China WTO Compliance report by 

reviewing a draft for accuracy.

In addition to this public reporting, Commerce, USTR, and Treasury 

officials stated that they inform stakeholders on the status of 

implementation through briefings to industry associations and to members 

of Congress and their staffs, participation in congressional hearings, and 

briefings to the trade advisory committees. Further, agency officials said 

they have briefed Congress repeatedly on broader U.S. engagement with 

China. Agency officials told us that while they did not generally provide 

reports to accompany the briefings, they may bring fact sheets, remarks, 

and recent speeches; we did not identify additional regular documentary 

reporting on the status of implementation of JCCT and S&ED 

commitments beyond the public reports.

Our review of reporting on implementation status revealed challenges to 

obtaining clear and comprehensive information. For some commitments, 

the reports lack information on the status of implementation and for some 

the reporting is not clear.26 Additionally, differences in the formats of the 

reports make locating information on a given commitment or issue area 

across reports difficult in some cases. The lack of detailed information on 

China’s progress in implementing certain commitments makes it difficult 

 

25Key agencies involved in this process include Commerce (including the Patent and 

Trademark Office), Treasury, State, and USDA. This interagency structure, called the 

Trade Policy Committee, led by USTR, has two subordinate bodies—the Trade Policy 

Review Group (a management-level committee) and the Trade Policy Staff Committee (a 

senior staff-level committee subordinate to the management-level committee). Numerous 

subcommittees under the Trade Policy Staff Committee have also been established to 

facilitate interagency coordination on a variety of trade issues. According to USTR, the 

Trade Policy Staff Committee’s Subcommittee on China meets in order to evaluate and 

coordinate U.S. engagement of China in the trade context and includes representatives 

from Commerce, Treasury, State, and USDA.

26We reviewed reporting for commitments made in 2010 and 2011 at the JCCT and 

S&ED, as well as reporting for all software legalization commitments made from 2008 

through 2011.

Reports Lack Clear and 

Comprehensive 

Information on Status of 

Implementation of JCCT 

and S&ED Trade and 

Investment Commitments
 

Page 21 GAO-14-102 China's Bilateral Trade Commitments

for Congress and other stakeholders to fully understand the progress the 

United States is making in reducing trade barriers.

Our analysis found several instances of incomplete reporting on the 

status of specific commitments related to market access barriers in 

sectors, such as software, and in cross-cutting areas such as industrial 

policy.27 For example,

• We identified 9 commitments from the 2008-2011 JCCT, and 1 from 

the 2011 S&ED related to software legalization.28 Based on our

analysis of the nine reports identified above, we were not able to 

clearly identify the implementation status of most of these specific 

commitments. For example, USTR has not reported on whether China 

has increased resources devoted to conducting audits and 

inspections as it committed to do at the 2011 JCCT.

• A second software legalization example illustrates a lack of clarity 

across reports on implementation status. At the 2011 JCCT, China 

committed to complete software legalization programs at the 

provincial level by the middle of 2012 and to publish the results of its 

software audits. The 2013 NTE report indicated that, because of a 

lack of published information, USTR could not verify that China had 

completed a program to ensure provincial governments used legal 

software. However, the 2013 Special 301 report, issued a month later, 

stated that China had completed the program. In addition to the 

difference regarding completion status of the legalization program at 

the provincial level, it is unclear whether China has implemented its 

related commitment to publish the results of audits. Thus, it cannot be 

determined whether the gap in implementation is one of program 

completion or one of reporting.

• There has not been reporting on implementation of commitments

concerning certain Chinese industrial policies. Specifically, at the 

2011 JCCT, China committed to ensure open and transparent 

processes for developing standards for smart-grid products and 

 

27USTR has reported that one of its priority concerns in China is problematic industrial 

policies and that the beneficiaries of these policies are certain state-owned enterprises. 

28According to USTR, software legalization refers to the goal of controlling the 

unauthorized copying of large numbers of legally obtained software programs by 

government agencies and state-owned enterprises.
 

Page 22 GAO-14-102 China's Bilateral Trade Commitments

technologies. USTR has not reported on the status of implementation 

of this commitment, despite having a specific report that describes 

progress in greenhouse gas reducing technologies. The greenhouse 

gas reports issued in 2012 and 2013 do not describe the steps taken 

in the JCCT regarding this issue.

• USTR has not reported on the implementation of some commitments 

made by China related to its use of technical standards to favor 

domestic suppliers. In the 2011 JCCT, China reported on the 

development and publication of revised safety standards for medical 

devices, acknowledged the value of closer cooperation with the 

United States on those standards, and committed to participate in an 

information exchange program with the United States in 2012. The 

status of that commitment was not addressed in either the 2012 or

2013 reports.

• Reporting on implementation of China’s commitments to reform stateowned enterprises has been incomplete. In the 2010 S&ED, China 

committed to continue its reform of these entities by, among other 

actions, inviting non-public and foreign investors to take equity stakes 

in them. China also committed at the 2010 JCCT that all enterprises in 

China, including state-owned enterprises, will make purchases and 

sales based solely on commercial considerations. As part of that 

same commitment, it committed to leave such decisions to those 

entities and to provide equal treatment to public and private 

enterprises. USTR has not reported on the status of implementation of 

these commitments in any of the nine trade-related reports.

In addition to incomplete or unclear reporting on the status of 

implementation of some commitments, differing report structures make it 

difficult in some cases to obtain information across reports. For example, 

we found reporting relevant to a 2010 S&ED commitment on new energy 

technologies discussed in the import barriers section of the NTE report’s 

chapter on China, whereas the WTO Compliance report discussed it 

under investment. Similarly, with respect to a 2012 JCCT commitment by 

China to issue a catalogue for the purchase of official use vehicles, the 

WTO Compliance report discussed the commitment in the intellectual 

property rights section, and the NTE report discussed it in a newly 

created category for the China chapter of the report, “Indigenous 

Innovation, Technology Transfer and Strategic Emerging Industry 

Barriers.” 
 

Page 23 GAO-14-102 China's Bilateral Trade Commitments

In interviews and documents, agency officials emphasized the need to 

balance reporting on the status of implementation of commitments with 

the requirement to avoid disclosures that would disadvantage the United 

States in ongoing consultations. For example, in the NTE report, USTR 

indicates that it does not provide estimates of the impact of trade barriers 

that are the subject of ongoing consultations to avoid disrupting them. In 

the case of the trade agenda, USTR may submit classified information to 

Congress in confidence, if it deems necessary.

The absence of clear and complete reporting on the status of 

implementation of commitments makes it difficult for policymakers to gain 

a comprehensive understanding of the progress made toward reducing 

trade barriers through the implementation of commitments from the 

dialogues. Moreover, accountability is reinforced through public reporting 

of agency results and, if appropriate, confidential reporting to Congress.

China has made a significant number and wide array of commitments to 

the United States in the JCCT and S&ED, high-level bilateral U.S.-China 

dialogues which address trade issues. While information on the 

commitments is available from agency fact sheets, information on the 

status of implementation is not presented in a manner that provides a

comprehensive understanding of China’s overall progress in 

implementing the commitments. Although at least nine reports present 

information on the status of U.S. efforts to decrease trade barriers with 

China, in some cases referencing the JCCT and S&ED, obtaining specific 

information on implementation status from the reports presents 

challenges. These nine reports aim to provide a comprehensive picture of 

the administration’s efforts to address trade barriers through consultative 

mechanisms such as the JCCT and S&ED. Without comprehensive 

reporting—easily accessible in one location and complete—it is difficult 

for external parties to understand the progress being made in removing 

barriers to this very important export market through bilateral dialogue. 

More consolidated and complete information on the status of China’s 

implementation of its JCCT commitments and S&ED trade and 

investment commitments would give policymakers a better basis to 

identify areas of success or failure. 

To improve policymakers’ and the public’s understanding of progress 

through bilateral dialogues in increasing access to China’s markets, we 

recommend that the U.S. Trade Representative, in conjunction with the 

Secretary of Commerce and the Secretary of the Treasury, work to 

Conclusions

Recommendation for 

Executive Action
 

Page 24 GAO-14-102 China's Bilateral Trade Commitments

provide clearer and more comprehensive reporting on the status of 

China’s implementation of its JCCT and S&ED trade and investment 

commitments. This reporting should include more complete information 

on the status of implementation of these commitments, as well as a more 

clearly identified source for consolidated information, which could be an 

existing report.

We provided a draft of this report to Commerce, USTR, Treasury, State, 

USDA, and OSTP. Commerce and USTR provided written comments 

which are reproduced in appendixes II and III. Commerce, USTR, 

Treasury, USDA, and OSTP provided technical comments which we 

incorporated as appropriate.

Neither Commerce nor USTR directly agreed or disagreed with our 

recommendation. Commerce stated that it would take GAO’s ideas and 

findings under careful consideration, but expressed concern regarding our 

conclusion that lack of comprehensive reporting makes it difficult for 

external parties to understand progress made in bilateral trade dialogues 

with China. It further observed that assessments of reporting needs 

should include consideration of resource requirements. We agree that 

resource considerations are a key factor in agency approaches to 

reporting, but believe that steps to make information on commitment 

implementation status more comprehensive and accessible can be taken.

USTR stated that it welcomed GAO’s suggestions and would consider 

them carefully, but identified several concerns. First, USTR expressed its 

view that some commitments are more noteworthy than others and 

counting and categorizing commitments can be misleading when used as 

the basis for conclusions about the relative significance of issue areas. 

We agree that not all commitments are of equal significance and reflected 

that view in our draft report. We believe, however, that summary 

quantitative information is one useful tool for conveying information about 

the issues addressed in these dialogues.

USTR commented that the report’s discussion of agencies’ tracking of the 

implementation of China’s commitments is generally accurate, but stated 

that the role of U.S. stakeholders such as industry associations and 

companies is not adequately reflected in the report. We agree that such 

organizations are an important source of information on commitment 

implementation and have added additional information in the report to 

reflect their role.

Agency Comments 

and Our Evaluation
 

Page 25 GAO-14-102 China's Bilateral Trade Commitments

With respect to U.S. agency reporting on commitment implementation, 

USTR stated that in its view the Administration’s written reporting 

currently provides congressional policymakers and other stakeholders 

comprehensive information on China’s implementation of JCCT and 

S&ED commitments, and stated that it also meets with those parties on 

these issues. It stated that not all JCCT and S&ED commitments warrant 

discussion in the reports, but acknowledged that GAO’s analysis identifies 

commitments whose implementation status should be reported on and 

has not been. Based on extensive analysis of agency reporting on the 

implementation of these commitments, we concluded that information on 

the status of commitments made in these bilateral dialogues with China is 

not complete and easily accessible, which can make it difficult for 

policymakers to identify areas of success and failure and assess options 

for moving forward. We recognize that meetings with policymakers and 

stakeholders are also an important part agency communication on these 

issues. 

We are sending copies of this report to the appropriate congressional 

committees; the U.S. Trade Representative; the Secretaries of 

Commerce, the Treasury, State, and Agriculture; the Director, Office of 

Science and Technology Policy; and other interested parties. The report 

also is available at no charge on the GAO website at http://www.gao.gov.

If you or your staff has any questions about this report, please contact 

David Gootnick at (202) 512-3149 or gootnickd@gao.gov. Contact points 

for our Offices of Congressional Relations and Public Affairs may be 

found on the last page of this report. Key contributors to this report are 

listed in appendix IV.

David Gootnick

Director, International Affairs and Trade
Appendix I: Objectives, Scope, and 

Methodology

Page 26 GAO-14-102 China's Bilateral Trade Commitments

In this report, we (1) describe the commitments China made at the Joint 

Commission on Commerce and Trade (JCCT) and the trade and 

investment commitments China made at the Strategic and Economic 

Dialogue (S&ED),1 (2) describe U.S. agency tracking of China’s 

implementation of these commitments, and (3) evaluate U.S. agency 

reporting on the status of commitment implementation.

To conduct this review, we interviewed knowledgeable U.S. government 

officials from the Department of Commerce (Commerce), the Office of the 

U.S. Trade Representative (USTR), the Departments of the Treasury 

(Treasury), State (State), and Agriculture (USDA) as well as the Office of 

Science and Technology Policy (OSTP) in Washington, D.C., and in 

Beijing, China (via a videoconference). We also interviewed 

representatives of trade associations and research organizations.

To describe the commitments, we conducted a detailed review of the fact 

sheets issued at the conclusion of annual meetings at the JCCT from 

2004 through 2012, the S&ED from 2009 through 2013, and the SED 

from 2006 through 2008. Commerce and USTR issue a JCCT fact sheet; 

Treasury issues jointly with China an S&ED fact sheet for the economic 

track that presents the joint commitments negotiated by the United States 

and China. (Treasury also issues a U.S. fact sheet that discusses the 

benefits of the commitments for U.S. workers and companies.) According 

to senior Commerce, USTR, and Treasury officials, the fact sheets 

present the commitments negotiated between the U.S. and Chinese 

governments. In addition to presenting the commitments, the fact sheets

also contain details of cooperative activities between the two countries. 

We used the joint fact sheets for our analysis of China’s S&ED 

commitments because, according to senior officials, they reflect the two 

governments’ understanding of the results of the S&ED plenary meeting. 

For the S&ED, we limited our analysis to China’s commitments in the 

trade and investment pillar of the dialogue’s economic track.2 In our 

analysis, “S&ED commitments” refer to the trade and investment 

 

1

The “S&ED commitments” in our analysis refer to trade and investment commitments 

China made at the S&ED and its predecessor, the Strategic Economic Dialogue (SED), 

which took place from 2006 through 2008.

2

The other three pillars of the S&ED’s economic track focus on macroeconomic 

cooperation, global economic governance, and financial markets. The United States and 

China discuss financial services trade issues under the financial markets pillar.

Appendix I: Objectives, Scope, and 

Methodology
Appendix I: Objectives, Scope, and 

Methodology

Page 27 GAO-14-102 China's Bilateral Trade Commitments

commitments China made in the S&ED in 2009 through 2013 and in the 

SED in 2007 and 2008.

We discussed the fact sheets with cognizant officials from Commerce and 

USTR, the two agencies that jointly lead the JCCT for the United States, 

and from Treasury, which leads the S&ED’s economic track for the United 

States, to obtain an understanding of the information they contain and 

how they are put together. According to senior USTR officials, the 

commitments as presented in the fact sheets are high-level political 

commitments and are the outcomes of the structured dialogues 

established to address and resolve a range of issues. While the outcomes 

documents are not legal instruments, the commitments are taken 

seriously, according to these officials.

To identify the commitments, we separated the fact sheet text describing 

steps taken by China into individual commitments, created a database, 

and systematically analyzed individual commitments. The fact sheets 

state China’s commitments, U.S. commitments, and joint U.S-China 

commitments. We excluded fact sheet text reflecting U.S. commitments, 

but included statements about commitments made jointly by the United 

States and China and by China alone.

We identified 184 JCCT commitments and 114 S&ED trade and 

investment commitments. (An inventory of the commitments we identified 

and their categorization by issue area, described below, is provided in an 

online e-supplement, GAO-14-224SP.) JCCT fact sheets, written by the 

U.S. government, are typically written in bulleted form, with each bullet 

generally considered by us as one commitment. S&ED fact sheets are 

different in that the precise wording of every commitment is negotiated 

jointly by the U.S. and Chinese governments. The 2013 S&ED fact sheet 

listed the trade and investment commitments in bulleted format. Prior to 

that, the commitments were written in paragraphs that included 

statements on multiple topics. The JCCT and S&ED fact sheets vary in 

terms of the number of areas and activities addressed, and in the 

specificity of the statements. We discussed with U.S. agencies ways to 

identify and count specific commitments in fact sheets, and determined 

that there is no single way to do so. For example, an analysis of the 

S&ED fact sheets for 2009 through 2012 might treat a paragraph as a 

commitment. We chose to break some paragraphs into multiple 

commitments, using decision rules that we developed to ensure the 

consistency and completeness of this exercise. These included whether 

the paragraph referred to more than one intended action or discrete 

concept, and whether it specified a deadline. In addition, if the same or 
Appendix I: Objectives, Scope, and 

Methodology

Page 28 GAO-14-102 China's Bilateral Trade Commitments

similarly worded commitment was made in multiple years, we counted it 

anew each time.

After identifying individual commitments, we categorized them by several 

characteristics (issue areas, joint or China-only, deadline). We identified 

11 issue areas to characterize the content of each commitment after an 

iterative review of all of the commitments in our database by several 

analysts. To support development of these categories we used as a 

reference point categories developed in a previous GAO report on 

China’s commitments3 as well as the headers used in JCCT source 

documents. (S&ED fact sheets do not use headers and sub-headers for 

the commitments in the trade and investment pillar.) These were adapted 

and recombined producing a set of categories that took into account the 

specific language of the specific sets of commitments from recent years 

and covered both dialogues. See the list of issue areas with descriptions 

and examples in table 2.

We then assessed each commitment for the issue area(s) it covered. 

Because many commitments covered multiple issue areas, we assigned 

up to three issue areas to each commitment. Ninety-nine of the 184 JCCT 

commitments and 55 of the 114 S&ED commitments were associated 

with two or three issue areas. We identified some commitments that did 

not fit any of the 11 issue areas and categorized these commitments as 

“other.” 

 

3

GAO, World Trade Organization: Analysis of China’s Commitments to Other Members, 

GAO-03-4 (Washington, D.C.: October 2002).
Appendix I: Objectives, Scope, and 

Methodology

Page 29 GAO-14-102 China's Bilateral Trade Commitments

Table 2: List of Issue Areas Identified in GAO’s Analysis of China’s JCCT Commitments (2004-2012) and S&ED Trade and 

Investment Commitments (2007-2013)

Issue area Description of issue area Examples of commitments associated with issue area

1 Government 

procurement

Includes policies for purchase of goods and 

services by government and by stateowned enterprises as well as negotiations 

for China’s accession to the World Trade 

Organization (WTO) Agreement on 

Government Procurement.a

The United States and China recognize the importance of nondiscriminatory government procurement policies. To that end, 

the United States and China agree to strengthen their 

cooperation in order to accelerate China’s accession to the 

WTO Government Procurement Agreement. This will include 

China’s submission, to the WTO Government Procurement 

Committee before the Committee’s October 2009 meeting, of a 

report that sets out the improvements that China will make in its 

revised offer. (S&ED, 2009)

2 High technology 

trade

Includes promotion of U.S. high technology 

exports to China.

Continue cooperation through the JCCT High Technology and 

Strategic Trade Working Group by positively implementing 

“Guidelines for U.S.-China High Technology and Strategic 

Trade Development” and taking appropriate constructive 

measures and working out an action plan to expand and 

facilitate bilateral high-tech and strategic trade. (SED, 2007)

3 Innovation Includes measures promoting “indigenous 

innovation”

b and linkages between 

innovation policies and government 

procurement preferences.

The relevant Chinese departments are conducting further 

modifications to the Implementing Regulations on the 

Government Procurement Law and will seriously take into 

account opinions and suggestions from all sides, including from 

the United States. In government procurement, China will give 

equal treatment to all innovation products produced in China by 

foreign-invested enterprises and Chinese-invested enterprises 

alike. (The United States expressed concerns that under Article 

9 of China’s draft Regulations, product lists could be used to 

provide government procurement preferences to indigenous 

innovation products.) (JCCT, 2010)

4 Intellectual 

property rights

Includes laws and regulations providing for 

the protection and enforcement of 

intellectual property rights, such as 

copyrights, trademarks, and patents.

China and the United States agreed to continue cooperation on 

strengthening library intellectual property rights protection and 

to continue exchanging views and sharing information with 

rights holders about library intellectual property rights protection 

efforts. Specifically, China’s National Copyright Administration 

described its ongoing efforts to investigate complaints by 

academic journal publishers about web-based enterprises’ 

piracy of library academic journals, and agreed to take prompt 

action at the conclusion of its investigations. (JCCT, 2010)

5 Investment Includes laws, regulations, and other 

measures that limit foreign investment, 

such as regulations on mergers and 

acquisitions involving foreign investors.

China commits to provide fair treatment to foreign investors in 

China. China is to focus its security review over mergers and 

acquisitions by foreign capital solely on national security 

concerns and adhere to specific timelines and review 

standards. China is to continue to simplify its foreign investment 

approval system and enhance transparency on a step-by-step 

basis. During the 12th Five Year Plan period, China is to 

implement a more proactive opening-up strategy and expand 

the areas open to foreign investment and the degree of 

openness. (S&ED, 2012)
Appendix I: Objectives, Scope, and 

Methodology

Page 30 GAO-14-102 China's Bilateral Trade Commitments

Issue area Description of issue area Examples of commitments associated with issue area

6 Multilateral issues Includes references to international 

agreements and consistency of domestic 

laws, regulations, and practices with 

multilateral commitments.

China has committed to improve protection of electronic data by 

ratifying and implementing the World Intellectual Property 

Organization Internet Treaties as soon as possible [and] 

extending an existing ban on the use of pirated software in 

central government and provincial agencies to include local 

governments. (JCCT, 2004)

The United States and China recognize that it is critical to follow 

WTO rules when initiating trade remedy investigations and 

imposing trade remedy measures, to prevent their abuse, and 

commit to refrain from using such measures for purposes other 

than trade remedies themselves, including to achieve industrial 

policy objectives. The two sides commit to respect the decisions 

of the WTO dispute settlement mechanism. Both sides commit 

to handle anti-dumping and countervailing duty investigations in 

a fair, objective, and transparent manner. (S&ED, 2012)

7 Open trade 

principles

Includes statements affirming commitment 

to open trade and investment.

Against the background of deteriorating economic conditions 

worldwide, the U.S. and China highlighted the importance of 

and their shared commitment to fighting protectionism and 

promoting open trade and investment. (SED, 2008)

8 Sector-specific 

issues

Includes measures and policies—such as 

custom duties, tariff-rate quotas, export 

subsidies, domestic support, and 

restrictions on imports for health and 

environmental reasons—that limit market 

access for U.S. companies in specific 

sectors or industries.

Agriculture: China agreed to immediately allow seven U.S. 

poultry processing plants to resume exports to China. [The 

United States has] urged China to work to address underlying 

systemic issues to eliminate such problems in the future. 

(JCCT, 2008)

Software: China is to further promote the use of legal software 

by state-owned enterprises, including by strengthening 

supervision of central state-owned enterprises and large stateowned financial institutions by establishing software asset 

management systems; enforcing China’s requirement to 

purchase and use legitimate software by these state-owned 

enterprises; providing budget guarantees for software and 

promoting centralized procurement. The United States and 

China are to strengthen cooperation to address technical 

implementation issues, in order to consolidate the software 

legalization achievements. (S&ED, 2013)

9 Technical and 

regulatory barriers 

to trade

Includes non-tariff trade barriers in the form 

of product standards, technical 

requirements, testing, and certification, as 

well as regulatory barriers to trade.

Technical: China will consider an exemption of requiring 

product samples to be tested in Chinese test labs prior to 

approval if the manufacturer demonstrates compliance with 

international standards and provides sound scientific evidence. 

(JCCT, 2009)

Regulatory: China agreed to convene another meeting of the 

U.S.-China Insurance Dialogue before the end of 2005 to 

discuss regulatory concerns and barriers to further liberalization 

of the sector. (JCCT, 2005)
Appendix I: Objectives, Scope, and 

Methodology

Page 31 GAO-14-102 China's Bilateral Trade Commitments

Issue area Description of issue area Examples of commitments associated with issue area

10 Trade remedies Includes subsidies providing economic 

benefit granted by a government to 

domestic producers of goods or services, 

often to strengthen their competitive 

position, as well as laws and regulations 

related to antidumping and countervailing 

duties.

China will provide a detailed accounting of its subsidies to the 

WTO by the end of 2005. (JCCT, 2005)

Both sides decided to prioritize work during the next six months 

in several areas: Launch agreement consultations to facilitate 

Chinese group leisure travel to the United States, continue 

discussions on the possibility of a bilateral investment 

agreement, and strengthen consultation and cooperation on 

China’s market economy status. (SED, 2007)

Both sides agreed to continue consultation through the JCCT 

and other channels on trade remedy rules and procedure. 

(SED, 2008)

11 Transparency Includes efforts to improve the openness of 

China’s trade regime by, for example, 

publishing proposed regulations, providing 

clarifying information on rules, laws, or 

processes, or providing opportunities to 

comment on draft regulations.

China and the United States reaffirm their prior SED outcomes 

on transparency. The United States welcomes China’s 

statement that it will issue a measure in 2011, to implement the 

requirement to publish all proposed trade- and economicrelated administrative regulations and departmental rules on the 

State Council Legislative Affairs Office (SCLAO) website for a 

public comment period of not less than 30 days from the date of 

publication, except as specified in China’s Protocol of 

Accession to the WTO or in public emergency situations. China 

will steadily increase its solicitation of public opinions on 

regulatory documents with a direct influence on the rights and 

obligations of citizens, legal persons, or other organizations. 

(S&ED, 2011)

12 Other Includes statements of cooperation on 

such issues as rules of origin, 

counterterrorism, sub-national cooperation, 

trade financing, market access for U.S. 

small- and medium-sized enterprises, 

Chinese value-added tax (VAT), and 

others.

Both sides agreed to strengthen cooperation on Rules of Origin, 

Customs Trade Partnership Against Terrorism, and the 

protection of cultural relics. (SED, 2008)

China confirmed that a Ministry of Finance-led delegation would 

hold discussions with the United States, beginning in the first

half of 2013, in order to work toward a mutual understanding of 

China’s VAT system and the concepts on which a trade neutral 

VAT system is based. (JCCT, 2012)

Source: GAO analysis of JCCT and S&ED fact sheets; U.S. agency and WTO reports.

Notes:

a

The WTO Government Procurement Agreement (GPA) is a plurilateral agreement that currently 

covers the United States and 41 other WTO members. China is not yet a party to the GPA. The GPA 

applies to the procurement of goods and services by central and sub-central government agencies 

and government enterprises specified by each party, subject to specified thresholds and certain 

exceptions. It requires GPA parties to provide most-favored-nation and national treatment to the 

goods, services and suppliers of other GPA parties and to conduct their procurement in accordance 

with procedures designed to ensure transparency, fairness and predictability in the procurement 

process. China has committed in its WTO accession agreement that all of its central and local 

government entities will conduct their procurements in a transparent manner until China completes its 

accession to the GPA.

b

Indigenous innovation” policies promote the development, commercialization, and purchase of 

Chinese products and technologies and may disadvantage U.S. and other foreign firms and create 

new barriers to foreign direct investment and exports to China. These policies are often embedded in 

government procurement, technical standards, anti-monopoly policy, and tax laws and regulations. 

See U.S. International Trade Commission, China: Intellectual Property Infringement, Indigenous 

Innovation Policies, and Frameworks for Measuring the Effects on the U.S. Economy, Publication 

4199, November 2010.
Appendix I: Objectives, Scope, and 

Methodology

Page 32 GAO-14-102 China's Bilateral Trade Commitments

Many commitments, including 110 JCCT and 11 S&ED commitments, 

were related to specific sectors (see examples for agriculture and 

software in table 2). We identified 15 sectors: agriculture, 

distribution/retail, information technology and security, insurance, new 

energy vehicles, pharmaceuticals and medical devices, postal/courier, 

shipping, software, steel, telecommunications, textiles, transportation, 

travel and tourism, and wind power. We discussed this methodology with 

officials from Commerce, USTR, Treasury, State, and USDA.

To ensure the validity of this analysis we performed multiple sets of 

reviews and checks. Initial testing of subsets of the commitments was 

done by two analysts and a methodologist. The full analysis of all 

commitments was performed by two analysts who cross-checked each 

other’s analysis and reconciled differences through discussion. A 

methodologist provided a spot-check of the analysis. Finally, the full team 

met and discussed in detail every commitment to ensure final consensus 

on the issue area categorization.

To describe how agencies track the status of implementation of 

commitments, we interviewed officials and reviewed documents from 

Commerce, USTR, Treasury, State, USDA, and OSTP. We also 

discussed these issues with U.S. embassy staff in Beijing, via 

videoconference. We discussed with the officials their processes for 

tracking commitment status, and sought corroborating information where 

needed. For example, we sought corroborating information from officials 

concerning their engagement with China in other various bilateral and 

multilateral forums, and their obtaining input from industry stakeholders 

and U.S. government officials based overseas. We corroborated this 

information by reviewing public reports from the outcomes of other 

diplomatic forums such as minutes from World Trade Organization 

standing committee meetings and public comments submitted by industry 

officials in conjunction with agency preparation of public reports.4 We also 

reviewed a cable from the 2010 JCCT mid-year review and a cable about 

the 2010 S&ED annual meeting. Finally, we reviewed agendas for the 

2010-2012 JCCT mid-term reviews. We also interviewed industry 

associations.

 

4

According to USTR, the WTO standing committees meet regularly to allow members to 

exchange views, to work to resolve questions of compliance with commitments, and to 

work to improve the global trading system. The standing committees do not include 

negotiating bodies or dispute settlement panels.
Appendix I: Objectives, Scope, and 

Methodology

Page 33 GAO-14-102 China's Bilateral Trade Commitments

With respect to the use of tools such as tracking sheets to maintain and 

share information on commitment implementation, we discussed agency 

staff-level methods for tracking the status of commitments with officials 

from Commerce. For contextual purposes, we also discussed with State 

officials their process for tracking the status of commitments in the 

strategic track of the S&ED. We discussed with Commerce staff the 

characteristics and use of a tracking document developed by staff for 

compiling information on commitment implementation for use in briefing 

senior officials for key meetings.

To evaluate how U.S. agencies report on the status of commitment 

implementation, we asked agency officials and consulted agency 

documents to identify relevant public documents and other types of 

reports they use to inform the public and Congress on the outcomes and 

status. They identified nine reports that describe administration efforts to 

reduce trade barriers through negotiations, consultations and dispute 

settlement, which are identified in the body of this report. To make 

assessments of the reporting that we identified across the reporting 

documents, we focused primarily on identifying information that 

specifically referenced the status of implementation of the commitment by 

the Chinese government or other relevant Chinese entities. To assess the 

completeness of the reporting, we examined the nine reports for

information on the status of implementation of commitments made in the 

JCCT and the S&ED in 2010 and 2011 and in additional years—2008 and 

2009—related to software legalization. We examined these commitments 

related to software legalization because intellectual property was a 

prominent JCCT issue area and we had identified software earlier in our 

review as a potential illustrative area. For each of these commitments, we 

reviewed reporting subsequent to when the commitment was made. The 

assessment included keyword searches of the nine reports.. For example, 

for a software legalization commitment we performed keyword searches 

using “software,” “legalization,” and other terms specific to the 

commitment. We also did a more general reading of reporting language 

relevant to a given commitment. This analysis was reviewed by a second 

analyst and any differences the reviewer had with the original analysis 

were reconciled.

We reviewed the congressional budget justifications for Commerce, 

USTR, Treasury, and USDA to describe how U.S. efforts to track and 

report on the status of China’s implementation of commitments supported 

agency and administration goals. We also reviewed comments from 

industry representatives submitted in conjunction with the preparation of 

statutory reports.
Appendix I: Objectives, Scope, and 

Methodology

Page 34 GAO-14-102 China's Bilateral Trade Commitments

We conducted this performance audit from May 2012 to February 2014 in 

accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.
Appendix II: Comments from the Department 

of Commerce

Page 35 GAO-14-102 China's Bilateral Trade Commitments

Appendix II: Comments from the Department 

of Commerce
Appendix III: Comments from the Office of the 

U.S. Trade Representative

Page 36 GAO-14-102 China's Bilateral Trade Commitments

Appendix III: Comments from the Office of 

the U.S. Trade Representative
Appendix III: Comments from the Office of the 

U.S. Trade Representative

Page 37 GAO-14-102 China's Bilateral Trade Commitments
Appendix III: Comments from the Office of the 

U.S. Trade Representative

Page 38 GAO-14-102 China's Bilateral Trade Commitments
Appendix III: Comments from the Office of the 

U.S. Trade Representative

Page 39 GAO-14-102 China's Bilateral Trade Commitments
Appendix III: Comments from the Office of the 

U.S. Trade Representative

Page 40 GAO-14-102 China's Bilateral Trade Commitments
Appendix IV: GAO Contact and Staff 

Acknowledgments

Page 41 GAO-14-102 China's Bilateral Trade Commitments

David Gootnick, at (202) 512-3149 or gootnickd@gao.gov

In addition to the individual named above, Celia Thomas (Assistant 

Director), R. Gifford Howland, Shakira O’Neil, Sada Aksartova, Karen 

Deans, David Dornisch, Etana Finkler, and Ernie Jackson made key 

contributions to this report.

Appendix IV: GAO Contact and Staff 

Acknowledgments

GAO Contact

Staff 

Acknowledgments

(320911)
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