The United States on Friday formally launched a trade investigation into China's intellectual property practices and forced transfer of American technology, which President Donald Trump had called for this week.

"On Monday, President Trump instructed me to look into Chinese laws, policies, and practices which may be harming American intellectual property rights, innovation, or technology development," US Trade Representative Robert Lighthizer said in a statement.

"After consulting with stakeholders and other government agencies, I have determined that these critical issues merit a thorough investigation."

Foreign companies have long complained about Beijing's failure to protect know-how and patents, and in some cases forcing firms to share information with domestic partners as the price for doing business in the massive Chinese market.

But they also have been timid about pressing too hard for their governments to take action, for fear of losing access to China.

But "Washington will turn a blind eye no longer," Trump insisted on Monday.

"We will safeguard the copyrights, patents, trademarks, trade secrets and other intellectual property that is so vital to our security and to our prosperity," he said.

America, he added, will no longer tolerate Beijing's "theft" of US industrial secrets.

Lighthizer is launching the investigation under Section 301 of US trade law, which addresses intellectual property.

Beijing this week fired back, warning that "everybody will lose" in the event of a trade war between the world's two largest economies.

The United States is China's second-largest trading partner after the European Union, and had a deficit of nearly $310 billion last year

Source: AFP