USTR Releases 2004 Report on Worldwide Intellectual Property Protection

Originally published Summer 2004

When developing a global strategy for intellectual property (IP) protection, one of the factors a company should consider is whether the targeted countries provide an environment conducive to the enforcement of IP rights. A company generally should not expend significant amounts of time and money to obtain IP rights outside of the United States if those rights cannot be used effectively to secure or maintain a competitive advantage. (See, for example, "Foreign Patent Filing: Protecting Your Technology in a Global Environment" in the Spring 2004 issue of the Intellectual Property Observer - to view this online, please click on the 'Next Page' link provided at bottom of this page.)

Without assistance, it may be difficult for a company to evaluate the legal protection for IP in foreign countries of interest. One resource, however, is available to everyone with access to the web. Under the Trade Act of 1974, the office of the United States Trade Representative (USTR) is required to identify those countries that either fail to adequately and effectively protect IP or deny fair and equitable market access to U.S. persons that rely on IP protection. The results of the USTR's study are published annually as the USTR's "Special 301" reports. This year's edition of the report can be found at http://www.ustr.gov/reports/2004-301/special301.htm.

The report provides a short discussion of each country that the USTR deems guilty of inadequate IP protection or of disadvantaging U.S. actors relying on IP rights and identifies particular problems in those countries.

Countries are deemed "Priority Foreign Countries" if they have the "most onerous and egregious acts, policies and practices which have the greatest adverse impact" on the relevant U.S. products and are not engaged in negotiations with the USTR to address these issues. In the report for 2004, the only Priority Foreign Country is Ukraine, due to widespread optical media piracy and an inadequate IP law regime.

If the USTR is able to negotiate an agreement with any of the Priority Foreign Countries to address its perceived violations, Section 306 of the Trade Act requires the USTR to monitor the country's compliance with the agreement. These so-called "Section 306" countries are separately identified in the report. This year's Section 306 countries are...