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China patents (and China utility models count for 1/6 of a patent).

Licensing doesn't help. It used to be that you could transfer granted patents. You can still do that, but it is now discounted if the patent is transferred instead of being filed in the name of the local company in the first place. Anyone who wishes to play the game in China needs to file in the name of a local entity. (Don't do a joint venture over there...but that is another issue.) In other words, it is usually best to assign the rights to the application before it is filed. As far as I can tell, the PRC tax authorities treat that as if the patent were invented in China. (By the way, the China tax authorities change the rules almost yearly, so what I say now may be obsolete in the next go-round.

"If you have no technology (you make lollipops or toothbrushes), do you pay the higher rate anyway because you have no IP to transfer?" Yes, but you can always file 6 utility models (which are not examined for novelty) on each product line you have. Lollipops and toothbrushes can be patented as well!

"Also, is the requirement of showing use merely a variant of our "Best Mode" requirement? Isn't the quid pro quo of patents to disclose how the invention is made or used?" No. They don't care about best mode. They care that their people have high tech jobs. They don't want a company to transfer a patent merely to enforce that patent against another company, thereby shutting down jobs in China. They want the patent to be practiced...their primary focus is jobs. So, you get the tax benefit if you are employing people with the patented concept.

I agree that much of the problem is difficult to address directly as part of a trade deal. However, I think even partial concessions would progress, and could be called a victory.

In my opinion, this is a golden opportunity for countries like Vietnam. Trump could really drive change in China if he and Shinzo Abe flew to Vietnam (and maybe a few others) and announced a major 3-way trade deal. China would have to worry about that...and they might grant some major concessions. Vietnam has a lot of potential, I think. But, as we've seen with India, it is always hard to predict when potential will become actual. The one thing China has that India does not, is a reliable power grid. Vietnam and other countries like them would do well to invest heavily in their infrastructure...I'm talking major investment. Companies are looking for an alternative to China, but the options are limited, as China has cheap labor and good infrastructure.