Asian Countries Continue to Dominate USTR 301 Report

12 October 2012

On May 2, 2011, the Office of the United States Trade Representative (USTR) published its annual review of the global state of intellectual property rights protection and enforcement, with Asian nations continuing to dominate the Priority Watch List, occupying six of the 12 slots. Asian nations on the Priority Watch List include China, India, Indonesia, Israel, Pakistan and Thailand.

China’s enforcement of IPR, as well as the implementation of its WTO obligations, remains a top priority for the US. According to the report, China made constructive commitments related to intellectual property generally, and software legalization specifically, in late 2010 and early 2011, and the report states that the US is looking to see “significant and measureable progress” on these commitments in the coming year.

The report praised the efforts of China’s Special Campaign, stating that if this leadership structure was followed permanently, lasting improvements in IPR enforcement could be achieved. However, the report went on to raise particular concerns regarding the development of China’s indigenous innovation and other intellectual property-related industrial policies, in particular those that require or encourage US parties to transfer their IPR to Chinese parties or to Chinese subsidiaries of US firms. The report stated that China should adopt policies that eliminate improper government intervention in intellectual property licensing and other lawful contractual business arrangements, and that welcome exports to and investments in China, irrespective of where the intellectual property in the products and services is owned or developed.

India also remains on the Priority Watch List, with the USTR concerned that although the country made incremental progress in 2010, the introduction of a Copyright Amendment Bill did not fully implement the WIPO Internet Treaties. The report goes on to state that India continues to have a weak legal framework, and ineffective overall IPR enforcement persists, and that India needs to take steps to improve the efficiency of judicial proceedings, and strengthen its criminal enforcement regime.

Indonesia remains on the Priority Watch List because “enforcement efforts were insufficient to keep pace with Indonesia’s piracy and counterfeiting problem,” particularly with respect to counterfeit pharmaceutical products and other counterfeit hard goods.

A failure to fully implement the Understanding on IPR that Israel and the US concluded in 2010 means Israel joins the Priority Watch List this year. As part of the Understanding, Israel committed to strengthen its laws on protection of pharmaceutical test data and patent term extension, and to publish patent applications promptly after the expiration of a period of eighteen months from the time an application is filed. Although Israel has submitted legislation to the Knesset regarding the protection of pharmaceutical test data, this has not yet been enacted, and to date Israel has not submitted legislation to the Knesset regarding patent term extension or patent publication.

In Pakistan, according to the report, widespread copyright piracy as well as trademark counterfeiting persist, resulting in the country remaining on the Priority Watch List.

Thailand remains on the list for the fourth year in a row, with the report stating that Thailand “failed to make substantial progress on several key pieces of legislation, including legislation to address landlord liability, legislation regarding unauthorized camcording of motion pictures in theatres, and legislation to provide Thai Customs officials with the authority to seize suspect goods absent a formal complaint by a rights holder.” The report also warns that Thailand has not enacted amendments to the Copyright Act that would have implemented the WIPO Internet Treaties. The report concludes that while IPR public awareness and education has improved, enforcement efforts in Thailand remain weak and non-deterrent, with piracy and counterfeiting, and the theft of cable and satellite signals, rampant in the country.

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