Trump Cautious on China Inquiry Over Intellectual Property Theft

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It is not clear how much time the additional step will add to the process. If approved, the investigation is expected to take as long as a year, officials said.

The delay was welcomed by those who have been worried about the president’s protectionist tendencies. The Trump administration was expected to move directly into the investigation, so the memorandum reflects the more measured approach the administration also appears to be taking with steel and aluminum.

“If this is the expression of Trumpian economic nationalism, most trade advocates are going to breath a sigh of relief,” said Scott Lincicome, an international trade attorney at the law firm White & Case.

The White House has sent mixed messages on the policy, as Mr. Trump’s campaign-rally denunciations of China collide with the complexities of a codependent geopolitical relationship. The president has publicly linked the issue of trade fairness with his calls on China to pressure North Korea to drop its weapons program and inflammatory rhetoric. Yet he and President Xi Jinping of China did not discuss this latest action in a phone conversation Friday night, and officials told reporters on Saturday that addressing intellectual property theft had been on their agenda since the president took office.

“This is a critical action, and long overdue,” said Michael Wessel, a member of the U.S.-China Economic and Security Review Commission, a bipartisan group created by Congress in 2000 to monitor trade and security issues between the world’s two largest economies.

“China’s been engaged in the theft and forced transfer of U.S. technologies and intellectual property for years,” added Mr. Wessel, a former Democratic congressional staff member. “An important question going forward will be whether U.S. companies and trade associations who have highlighted the problem will actually come forward and assist our government in the investigation or whether they will hide the facts, fearful that our government won’t follow through, that the Chinese will retaliate against their interests or that they’ll have to admit what’s happened to their critical assets.”

If the investigation finds evidence of wrongdoing, Mr. Trump could retaliate against China with tariffs or other punitive measures that have yet to be determined. Officials, speaking to reporters on the Saturday conference call, said their intention was not to punish Beijing but to negotiate an agreement that clawed back some of the estimated $600 billion in intellectual property theft officials estimate is perpetuated by China.

The policy shift, led by Mr. Trump’s economic adviser, Peter Navarro — a longtime critic of Beijing’s trade practices and the author of a recent book, “Death by China” — is unrelated to the continuing effort to persuade China to act more forcefully in the North Korea crisis, a senior administration official said.

Despite Mr. Trump’s promises to be tougher than previous presidents on trade, his administration has proceeded with a great degree of caution.

The United States is scheduled to embark next week on its first round of renegotiations of the North American Free Trade Agreement. So far, however, its expressed goals are not drastically different than what was agreed to in the Trans-Pacific Partnership trade pact that Mr. Trump has attacked.

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