Special 301 Report


The Special 301 Report is prepared annually by the Office of the United States Trade Representative USTR under Section 301 as amended of the Trade Act of 1974 The reports identify trade barriers to US companies and products due to the intellectual property laws, such as copyright, patents and trademarks, in other countries Each year the USTR must identify countries which do not provide "adequate and effective" protection of intellectual property rights or "fair and equitable market access to United States persons that rely upon intellectual property rights" Under the Special 301 provisions PubL 93–618, 19 USC § 2242 amended into Section 301 of the Trade Act of 1974 by section 1303 of the Omnibus Trade and Competitiveness Act of 1988,[1] the USTR must also undertake annual surveys of foreign countries' intellectual property laws and policies[2] The Special 301 Report was first published in 1989[3]

By statute, the annual report must identify a list of "Priority Foreign Countries", those countries judged to have inadequate intellectual property laws; these countries may be subject to sanctions In addition, the report contains a "Priority Watch List" and a "Watch List", containing countries whose intellectual property regimes are deemed of concern

Contents

  • 1 Preparation
    • 11 Complaints by US companies
    • 12 NGO submissions
  • 2 Designations
    • 21 Priority Foreign Country
    • 22 Priority Watch List and Watch List Countries
    • 23 Historical designations
  • 3 Effects
    • 31 WTO dispute settlement proceedings
  • 4 Criticism
    • 41 Lobbying power
    • 42 Trade warring
  • 5 See also
  • 6 Bibliography
  • 7 References
  • 8 External links

Preparation

The Special 301 Sub-Committee of the Trade Policy Staff Committee TPSC advises the US Trade Representative on which countries to designate as "priority foreign countries" or to include in the watchlists The Special 301 Sub-Committee is chaired by the Office of the United States Trade Representative USTR and its members include the Department of Commerce, the Patent and Trademark Office, the Department of State, the Department of Health and Human Services, the Department of Agriculture, the Copyright Office, the Council of Economic Advisers, and other agencies US companies provide extensive comments in the annual National Trade Estimate Report The Special 301 Sub-Committee also takes the views of foreign governments and the views of US embassies on intellectual property rights[4]

Complaints by US companies

US companies and intellectual property owners, including copyrights, patents and trademarks, can submit complaints to the Trade Compliance Centre, which provides a template for such complaints, or the country or industry desk at the International Trade Administration ITA of the US Department of Commerce The ITA then reviews trade-related complaints with co-operation from the Office of General Counsel and the US Patent and Trademark Office The complaint can not be in relation to disputes between companies on intellectual property rights, but must be about instances where a country has violated an international agreement with the United States Complaints can be made in relation to the intellectual property law of the country, judicial or administrative procedures that discriminate against the US company, and failure to enforce intellectual property laws, particularly in relation to trade in counterfeit goods, and lately online copyright infringement Complaints do not need to reference specific international agreements or provisions that are being breached Complaints will focus on a country's failure to protect the intellectual property rights of a US company or lack of intellectual property rights relates market access Complaints are expected to include a description of the efforts the company has made to enforce its intellectual property rights in that country and provide estimates of economic losses resulting from the infringement of intellectual property rights in that country[5][6]

Most countries included in the Priority Watch List and Watch List between 1996 and 2000 were requested by Pharmaceutical Research and Manufacturers of America PhRMA or the International Intellectual Property Alliance IIPA[7] According to Andres Guadamuz of the University of Edinburgh, the IIPA, which represents the US media industry, urged the US government to consider countries like Indonesia, Brazil, and India for inclusion in the Special 301 Watchlist in early 2010 because they either mandated or suggested the use of open-source software[8]

NGO submissions

In 2010, NGOs such as PhRMA, Oxfam, and MSF made submissions to the USTR[9]

Designations

Priority Foreign Country

Special 301 Report 2013   Priority Foreign Country   Priority Watch List   Watch List   Section 306 Monitoring   Status Pending

A Priority Foreign Country is the worst classification given to "foreign countries that deny "adequate and effective" protection of intellectual property rights IPR or "fair and equitable market access" to US persons relying upon IPR protection" under the Trade Act On 13 March 2001, the United States Trade Representative designated Ukraine as a Priority Foreign Country [1] citing the massive amounts of unlicensed CDs sold in Europe that originate from the Ukraine In 2011 and 2012 no countries were classified as a Priority Foreign Country however Paraguay was made subject to Section 306 Monitoring In 2013, Ukraine was reinstated to Priority Foreign Country In 2014, the USA was in talks with the WTO to enlist India as a "Priority Foreign Country" especially for the pharmaceutical sector

Under the amended Section 301 of the Trade Act of 1974 the USTR must by April 30 of each year:

"identify 1 those foreign countries that A deny adequate and effective protection of intellectual property rights, or B deny fair and equitable markets access to United States persons that rely upon intellectual property protection, and 2 those foreign countries identified under paragraph 1 that are determined by the Trade Representative to be priority foreign countries"[1][10][11]

The Act defines "priority foreign countries" as:

"those foreign countries - A that have the most onerous or egregious acts, policies, or practices that i deny adequate and effective intellectual property rights, or ii deny fair and equitable market access to United States persons that rely upon intellectual property protection, B whose acts, policies, or practices described in subparagraph A have the greatest adverse impact actual or potential on the relevant United States products, and C that are not i entering into good faith negotiations, or ii making significant progress in bilateral or multilateral negotiations to provide adequate and effective protection of intellectual property rights"[1][11]

The Uruguay Round Agreement Act furthermore states that countries may be identified under Special 301 "taking into account the history of intellectual property laws and practices of the foreign country, including any previous identifications" and "the history of efforts of the United States, and the response of the foreign country, to achieve adequate and effective protection and enforcement of intellectual property rights" It also states that compliance with the World Trade Organization's Agreement on Trade-Related Aspects of Intellectual Property Rights TRIPS does not preclude a country from being identified as denying "adequate and effective protection of intellectual property rights"[10][11]

The USTR acts on the information available at the time and can identify new "priority foreign countries" on an annual basis The Special 301 Sub-Committee of the Trade Policy Staff Committee conducts additional reviews throughout the year for countries that "merit additional monitoring" The Trade Act of 1974 requires that the USTR must start investigations within 30 days of a country being identified as "priority foreign country", unless the USTR concludes that such an investigation "would be detrimental to United States economic interests" Unless the "priority foreign country" is regarded as being in breach of a trade agreement, including the Agreement on Trade-Related Aspects of Intellectual Property Rights TRIPS, investigations must conclude within six months, with the possibility of a three-month extension[11] Reasons for extension include "substantial progress in drafting or implementing legislative or administrative measures that will provide adequate and effective protection of intellectual property rights" by the "priority foreign country"[11][4] If the USTR believes that a trade agreement is being breached the USTR must conclude the investigation within 18 months, or within 30 days after the "dispute settlement procedure" has finished If the USTR concludes that a trade agreement is being breached, "retaliation actions" may be taken under Section 301 of the Trade Act of 1974[4]

Priority Watch List and Watch List Countries

Two non-statutory categories have been created in addition to the statutory category of "priority foreign country", which once identified as such needs to be investigated and if found in breach with a trade agreement is subject to possible "retaliation actions" under Section 301 of the Trade Act of 1974 "Priority Watch List" and "Watch List" countries are identified by the annual Special 301 Report "Priority Watchlist countries" are judged by the USTR as having "serious intellectual property rights deficiencies" that require increased USTR attention "Watch List" countries have been identified by the USTR as having "serious intellectual property rights deficiencies" but are not yet placed on the "Priority Watchlist" The USTR can move countries from one list to the other, or remove them from the lists, throughout the year[4]

Historical designations

The International Intellectual Property Alliance keeps these statistics since 1989

  • PFC: Priority Foreign Country
  • PWL: Priority Watch List
  • WL: Watch list
  • Monitoring: Section 306 Monitoring
  • Pending: Status Pending
  • : Indicates a change in categorisation
Country 2006[12] 2007[13] 2008[14] 2009[15] 2010[16] 2011[17] 2012[18] 2013[19] 2014[20]
Algeria WL PWL PWL PWL PWL PWL PWL
Argentina PWL PWL PWL PWL PWL PWL PWL PWL PWL
Bahamas WL
Barbados WL WL
Belarus WL WL WL WL WL WL WL WL
Belize PWL WL
Bolivia WL WL WL WL WL WL WL WL WL
Brazil PWL WL WL WL WL WL WL WL WL
Brunei WL WL WL WL
Bulgaria WL WL WL
Canada WL WL WL PWL PWL PWL PWL WL WL
Chile WL PWL PWL PWL PWL PWL PWL PWL PWL
China PWL PWL PWL PWL PWL PWL PWL PWL PWL
Colombia WL WL WL WL WL WL WL WL WL
Costa Rica WL WL WL WL WL WL WL WL WL
Croatia WL
Czech Republic WL WL
Dominican Republic WL WL WL WL WL WL WL WL WL
Ecuador WL WL WL WL WL WL WL WL WL
Egypt PWL PWL WL WL WL WL WL WL WL
European Union WL
Finland WL WL WL WL WL WL
Greece WL WL WL WL WL WL WL
Guatemala WL WL WL WL WL WL WL WL WL
Hungary WL WL WL WL
India PWL PWL PWL PWL PWL PWL PWL PWL PWL
Indonesia PWL WL WL PWL PWL PWL PWL PWL PWL
Israel PWL PWL PWL PWL Pending PWL PWL WL
Italy WL WL WL WL WL WL WL WL
Jamaica WL WL WL WL WL WL WL WL WL
Kuwait WL WL WL WL WL WL WL WL WL
Latvia WL
Lebanon PWL PWL WL WL WL WL WL WL WL
Lithuania WL WL
Malaysia WL WL WL WL WL WL
Mexico WL WL WL WL WL WL WL WL WL
Norway WL WL WL WL WL
Pakistan WL WL PWL PWL PWL PWL PWL PWL PWL
Paraguay Monitoring Monitoring Monitoring Monitoring Monitoring Monitoring Monitoring WL WL
Peru WL WL WL WL WL WL WL WL WL
Philippines WL WL WL WL WL WL WL WL
Poland WL WL WL WL
Romania WL WL WL WL WL WL WL WL WL
Russia PWL PWL PWL PWL PWL PWL PWL PWL PWL
Saudi Arabia WL WL WL WL
South Korea WL WL WL
Spain WL WL WL WL
Taiwan WL WL WL
Tajikistan WL WL WL WL WL WL WL WL WL
Thailand WL PWL PWL PWL PWL PWL PWL PWL PWL
Trinidad and Tobago WL WL
Turkey PWL PWL WL WL WL WL WL WL WL
Turkmenistan WL WL WL WL WL WL WL WL WL
Ukraine PWL PWL WL WL WL WL PWL PFC PFC
Uzbekistan WL WL WL WL WL WL WL WL WL
Venezuela PWL PWL PWL PWL PWL PWL PWL PWL PWL
Vietnam WL WL WL WL WL WL WL WL WL

Effects

In response to countries being included on the Special 301 Report Watchlists the US government may initiate dispute settlement proceedings at the World Trade Organisation WTO or other relevant trade agreement, including the North American Free Trade Agreement NAFTA The US government can also eliminate tariff preferences unilaterally granted, such as the Generalized System of Preferences GSP[4][5]

If the US investigation concludes that a country has violated a trade agreement Section 301 of the Trade Act of 1974 allows the US government to impose unilateral trade sanctions if the country is not member of the World Trade Organisation WTO or any other trade agreement establishing dispute settlement provisions, such as free trade agreements, which are relevant to the alleged violation Unilateral trade sanctions under section 301 were imposed on December 20, 2001, on Ukraine by imposing a prohibitive tariff on metals, footwear, and other imports because the USTR concluded that the country had failed to enact legislation to enforce copyright in relation to music CDs and their export[4][5]

According to the International Intellectual Property Alliance IIPA the Special 301 Report and the Watchlists is used to pressure other nations to adopt stricter copyright laws and take a more active role in combating copyright infringement[21]

WTO dispute settlement proceedings

The USTR has used the Special 301 Reports to initiate formal dispute settlement proceedings at the World Trade Organisation WTO if it believes a country does not comply with the Agreement on Trade-Related Aspects of Intellectual Property Rights TRIPS WTO dispute settlement proceedings are initiated when the country's noncompliance with TRIPS is judged to be too narrow to make the country a "priority foreign country" The countries against which the USTR intends to pursue dispute settlement proceedings are announced every April in the Special 301 Report[4]

Criticism

Lobbying power

Peter Drahos, a law professor at the Centre for Commercial Law Studies at Queen Mary University of London's School of Law, has called the Special 301 Report "a public law devoted to the service of private corporate interests"[22] It explicitly protects and acts in favor of US intellectual property owners, most often large corporations, against any foreign national policy or unofficial action that does not conform, even in its domestic legislation, to the United States' position on international copyright and IP Threat of action under Special 301 has been used to insert US trade lobby backed advisers into states' domestic legislative process in order to ensure compliance with US trade norms One of the most direct examples comes from a former US trade lobbyist, speaking in 1993:

"Jamaica had no intellectual property law, but they wrote one with our help Similarly the Dominican Republic I sat down with their lawyer and together we wrote their copyright law" [23]

Such methods of drafting national-level legislation inevitably raise questions about undue influence from the private sector Lobbyists for the IP industry have been successful in their efforts to secure legal backing in foreign countries to already existing regimes such as TRIPS, and private corporations are now able to act as watchdogs to foreign national legislation on behalf of the US government[citation needed]

Trade warring

Most countries included in the Priority Watch List and Watch List between 1996 and 2000 were requested by Pharmaceutical Research and Manufacturers of America or International Intellectual Property Alliance[24] For example, Finland was blacklisted in retaliation to unanimously adopted legislation requiring the tax-funded Social Insurance Institution to reimburse the cost of medications only up to the price of the cheapest generic Intellectual property is not violated, as this affects all manufacturers equally; nevertheless, this retaliatory measure has had a negative impact on investment decisions unrelated to the pharmaceutical industry[25]

See also

  • Anti-Counterfeit Trade Agreement ACTA
  • Doha Development Round
  • Generalized System of Preferences
  • International Trade Administration
  • Notorious Markets
  • United States International Trade Commission
  • United States Commercial Service
  • Trade Act of 1974
  • Section 301 of the Trade Act of 1974
  • South Korea-United States relations

Bibliography

  • Masterson, John T 2004 International trademarks and copyright: enforcement and management American Bar Association ISBN 978-1-59031-359-6 

References

  1. ^ a b c "19 USC 2242 - Identification of countries that deny adequate protection, or market access, for intellectual property rights" gpogov 
  2. ^ Shayerah, Ilias; Fergusson, Ian F 2008 Intellectual Property Rights and International Trade Nova Publishers p 43 ISBN 978-1-60456-562-1 
  3. ^ "1989 Special 301 Report" PDF USTR 1989-05-25 Retrieved 2013-04-08 
  4. ^ a b c d e f g Masterson 2004, p 20
  5. ^ a b c Masterson 2004, p 21
  6. ^ Masterson 2004, p 22
  7. ^ Sell, Susan K 2003, Private Power, Public Law, Cambridge University Press, pp 126–129 
  8. ^ When using open source makes you an enemy of the state, Bobbie Johnson, guardiancouk, 23 February 2010
  9. ^ "The US Special 301 Reports, 1989-2010" USTR Knowledge Ecology International Retrieved 2013-04-08 
  10. ^ a b Masterson 2004, p 18
  11. ^ a b c d e Masterson 2004, p 19
  12. ^ "2006 SPECIAL 301 REPORT" PDF Retrieved 13 December 2014 
  13. ^ "2007 SPECIAL 301 REPORT" PDF Retrieved 13 December 2014 
  14. ^ "2008 SPECIAL 301 REPORT" PDF Retrieved 13 December 2014 
  15. ^ "2009 Special 301 Report" PDF Retrieved 13 December 2014 
  16. ^ "2010 Special 301 Report" Retrieved 13 December 2014 
  17. ^ "2011 Special 301 Report" Office of the United States Trade Representative April 2011 p 2 Retrieved 29 August 2011 
  18. ^ "2012 Special 301 Report" PDF USTR April 2013 Retrieved 2013-04-08 
  19. ^ "2013 Special 301 Report" PDF USTR May 2013 Retrieved 2013-05-25 
  20. ^ "2014 Special 301 Report" PDF Retrieved 13 December 2014 
  21. ^ "Copyright Industries Urge Greater Global Protection of American Jobs and Exports Threatened by Piracy" PDF IIPA 2010-02-18 Retrieved 2013-04-08 
  22. ^ Peter Drahos, Information Feudalism, The New Press, 2002, p89
  23. ^ Peter Drahos, Information Feudalism, The New Press, 2002, p87
  24. ^ Sell, Susan K 2003, Private Power, Public Law, Cambridge University Press, pp 126–129 
  25. ^ "Hätähuuto: Suomi luisuu takapajulaksi" in Finnish Kauppalehti 2010-06-15 Retrieved 2013-04-08 

External links

  • The Office of the United States Trade Representative Official website
  • Special 301 Report, 2016 published on April 30, 2016
  • Flynn, Sean May 1, 2013 "What is Special 301 A Historical Primer" infojusticeorg American University Washington College of Law 
  • "The US Special 301 Reports, 1989-2010" USTR Knowledge Ecology International  alongside supporting documents
  • Section 301 of the Trade Act


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