US ANNUAL REPORT FOCUSES ON CHINA'S IP PROTECTION

June 02, 2008 | BY

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The United States Trade Representative (USTR) has issued the 2008 Special 301 Review of its trading partners' levels of IP protection.The report focused…

The United States Trade Representative (USTR) has issued the 2008 Special 301 Review of its trading partners' levels of IP protection.

The report focused foremost on China and Russia, reflecting the size of the US's economic relationships with those countries and their political importance. Though China is still the subject of complaints from the US over the failure of its criminal system to provide effective deterrence against wilful counterfeiting and piracy, the country was praised for tackling software piracy.

“China is the most important of the US's trading partners so sees greater scrutiny. That said, its problems are greater,” said Nicholas Redfearn, head of Rouse & Co International's practice in Asia.

Issues of most importance globally this year include counterfeiting and piracy, internet piracy, counterfeit pharmaceuticals, transhipment of pirated and counterfeit goods and the use of legal software by government ministries.

Redfearn commented: “Whereas many years ago, a nation could get away with putting in place the right legislation, the USTR now will study detailed reports from a cross section of industries, setting out precise concerns over practical matters from the number of criminal convictions and border seizures to the ease of dealing with pirate trademark registrations, or preserving pharmaceutical regulatory data secrecy.”

Countries that are US trading partners but fail to provide adequate IP protection include China, India, Pakistan and Thailand. Indonesia, Malaysia, Philippines, South Korea, Taiwan and Vietnam have been criticized for weak enforcement against trademark counterfeiting and copyright piracy.

Apart from the specific counterfeiting and piracy problems arising from the criminal threshold requirements, the report focused on counterfeit pharmaceutical production, notorious fakes markets like the Beijing Silk Market and the Yiwu wholesale market, the sheer scale of IP violation in China, specific optical media, the Internet, software copyright piracy issues, the lack of strong customs export border protection, the lack of consistent civil court protection for IP and the narrow scope of patentable subject matter.

“The Special 301 review is not a discrete event. Over the year there will be discussions with all of these trading partners over the problems identified. Indeed Taiwan will be the subject of a specific out of cycle review mid year,” Redfearn said.

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