INEOS is suing state-owned Chinese oil and petrochemical company Sinopec and some of its associated businesses for allegedly violating patents.
INEOS said Sinopec Ningbo Engineering Company had broken a long established technology agreement which, together with alleged misuse of trade secrets by other Sinopec companies, had enabled it to build a series of acrylonitrile plants in China without INEOS’ consent.
“We want to take our best technology to China but we need to know that it will be protected,” said INEOS chairman Jim Ratcliffe. “The prolific building of acrylonitrile plants in China will destroy our business.”
INEOS, which has otherwise excellent relationships with Sinopec and with China, said in a statement on March 21 that it had no choice other than to protect its intellectual property.
“Unless we protect our hard-won intellectual property, which includes trade secrets and patents, covering technology, design and operations, ultimately we will see the demise of INEOS,” said Jim.
INEOS fears China’s actions will cause major harm to its acrylonitrile business which generates up to $500million in profit every year and supports about 5,000 jobs in America, the UK and Germany.
INEOS currently leads the global market for the production of acrylonitrile, the key building block for carbon fibre. The important molecule is also the key ingredient in ABS polymer, which is used in many everyday applications from children’s toys and computer monitors to white goods.
INEOS’ acrylonitrile technology provides the basis for over 90% of the world’s production. SNEC, a Sinopec company, has had a licence to use that technology since 1984.
INEOS, which is pursuing parallel actions in the Beijing High Court and through arbitration in Sweden, said it had ‘every confidence’ in China’s intellectual property system because it now files more patents than any other country.
Sinopec denies INEOS’ claims.