The US has raised the pressure on China to improve market access for foreign companies with the release of a highly critical report examining Beijing’s policies on the eve of bilateral trade talks in Washington.

A package of Chinese policies aimed at encouraging local innovation are “expected to make it difficult for foreign companies to compete on a level playing field in China”, said the International Trade Commission, a US government agency, in a report released on Monday night just ahead of the annual meeting of the Joint Commission on Commerce and Trade.

The ITC report is the first of two which, on the request from the US Senate, will attempt to measure the impact of intellectual property rights infringement in China and Chinese innovation policies on the US economy. If the second one, due next May, diagnoses sizeable damage to US companies and jobs, it could become the basis for US trade action against Beijing.