USTR Releases 2009 Special 301 IPR Report

by Mike Godfrey, for LawAndTax-News.com, Washington

01 May 2009

The Office of the US Trade Representative (USTR) has released its annual “Special 301” Report on the adequacy and effectiveness of intellectual property rights (IPR) protection by US trading partners.

The USTR reviewed 77 trading partners for this year’s Special 301 Report. Of these, the USTR has placed 46 trading partners on the Priority Watch List, Watch List, or the Section 306 monitoring list. Trading partners on the Priority Watch List do not provide an adequate level of IPR protection or enforcement, or market access for persons relying on intellectual property protection.

“Today’s Special 301 Report guides our efforts to protect American innovation and creativity around the world,” Ambassador Ron Kirk announced on April 30.

“Our creative and innovative products can hit the global marketplace sometimes with just a keystroke. If we and our trading partners are not vigilant in protecting and enforcing intellectual property rights, they can vanish just as quickly,” he added, continuing:

“As US right holders, businesses, and workers suffer losses from international piracy, counterfeiting, and other forms of IPR theft, the Special 301 Report provides a critical policy tool for focusing on urgent problems that undermine one of America’s great strengths in the global economy – our innovation and creativity.”

“In this time of economic uncertainty, we need to redouble our efforts to work with all of our trading partners – even our closest allies and neighbors such as Canada – to enhance protection and enforcement of intellectual property rights in the context of a rules-based trading system,” he explained.

Significant developments in this year’s Special 301 Report include the following:

• Canada is being elevated to the Priority Watch List for the first time, reflecting increasing concern about the continuing need for copyright reform, as well as continuing concern about weak border enforcement.
• The USTR is also elevating Algeria and Indonesia to the Priority Watch List, reflecting growing concern about the IPR situation in those countries.
• Korea is being removed from the Watch List in recognition of the significant improvements it has made during the past year, and the Korean government’s policy direction of continuing to place a priority on improving its IPR regime. This marks the first time in the history of the report that Korea has not appeared on either the Watch List or the Priority Watch List. The USTR will, however, continue to monitor closely the ongoing problem of Internet piracy in Korea, and will be prepared to consider returning Korea to the Watch List in the future if it does not respond effectively to this challenge through its implementation of newly enacted legislation and other steps.

Again this year, the USTR’s Special 301 Report highlights the prominence of IPR concerns with respect to China and Russia, despite some evidence of improvement in both countries:

• The USTR announced that it would maintain pressure on China by including it on the Priority Watch List. “I am particularly troubled by reports that Chinese officials are urging more lenient enforcement of IPR laws, motivated by the financial crisis and the need to maintain jobs,” Mr Kirk said, adding, “China needs to strengthen its approach to IPR protection and enforcement, not weaken it.”
• The Administration also continues to seek improvements to the intellectual property regime in Russia. The United States is committed to ensuring that Russia fulfills the promises it made to improve its IPR protection and enforcement regimes as part of a bilateral agreement with the United States.

2009 marks the 20th anniversary of the Special 301 Report, which was first issued in 1989 in accordance with the provisions of the Omnibus Trade and Competitiveness Act of 1988.

Other countries on this year’s Priority Watch List include Algeria, Argentina, Chile, India, Indonesia, Israel, Pakistan, Thailand, and Venezuela. Priority Watch List countries will be "the subject of particularly intense engagement through bilateral discussion during the coming year".

Thirty-three trading partners are on the lower level Watch List, "meriting bilateral attention to address the underlying IPR problems": Belarus, Bolivia, Brazil, Brunei, Colombia, Costa Rica, Czech Republic, Dominican Republic, Ecuador, Egypt, Finland, Greece, Guatemala, Hungary, Italy, Jamaica, Kuwait, Lebanon, Malaysia, Mexico, Norway, Peru, Philippines, Poland, Romania, Saudi Arabia, Spain, Tajikistan, Turkey, Turkmenistan, Ukraine, Uzbekistan, and Vietnam.

Paraguay will continue to be monitored under Section 306 monitoring under a bilateral Memorandum of Understanding that establishes objectives and actions for addressing IPR concerns in that country.

Finally, the Administration announced that it will conduct Out-of-Cycle Reviews for Fiji, Israel, the Philippines, Poland, and Saudi Arabia to monitor progress on specific IPR issues.

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