Background

The Office of the U.S. Trade Representative’s annual Special 301 report on trading partners’ intellectual property rights protection and enforcement efforts “seeks to be a positive catalyst for change” but omits the previous year’s warning of possible enforcement measures against countries that fail to address U.S. concerns.

China

USTR said China has taken some steps toward implementing its IPR-related commitments under the bilateral phase one trade agreement, including publishing several draft legal and regulatory measures, finalizing over a dozen, and amending its patent law, copyright law, and criminal law. However, USTR added that “these steps toward reform require effective implementation and fall short of the full range of fundamental changes needed to improve the IP landscape in China.” Further, longstanding problems such as bad faith trademarks and counterfeiting persist, and worrying developments such as broad anti-suit injunctions issued by Chinese courts have emerged. Moreover, Chinese officials have made high-level statements suggesting that IPR should be linked to national security and that the external transfer of IPR in certain technologies should be prevented.

Priority Watch List

Trading partners on the PWL present the most significant concerns regarding insufficient IPR protection or enforcement or actions that otherwise limit market access for persons relying on IPR protection. Argentina, Chile, China, India, Indonesia, Russia, Saudi Arabia, Ukraine, and Venezuela, all of which were on the PWL in the 2020 report, remain on the PWL this year. USTR said it will develop an action plan with benchmarks for each of these countries that has been on the PWL for at least one year to encourage progress on high-priority IPR concerns.

Watch List

The following trading partners are on the WL and merit bilateral attention to address underlying IPR problems: Algeria, Barbados, Bolivia, Brazil, Canada, Colombia, Dominican Republic, Ecuador, Egypt, Guatemala, Kuwait, Lebanon, Mexico, Pakistan, Paraguay, Peru, Romania, Thailand, Trinidad & Tobago, Turkey, Turkmenistan, Uzbekistan, and Vietnam. 

Algeria was moved from the PWL to the WL due to steps its government has taken to engage and cooperate with stakeholders, improve enforcement efforts, and reduce IPR-related market access barriers. The United Arab Emirates was removed from the WL after it resolved concerns about IPR protection of pharmaceutical products, made progress on longstanding IPR enforcement concerns, and began publishing annual IPR enforcement statistics.

Out-of-Cycle Reviews

OCRs focus on identified challenges in specific markets. Successful resolu­tion of these issues can lead to a positive change in a trading partner’s Special 301 status outside of the typical timeframe for the annual review, while failure to address these concerns or further deterioration within the specified timeframe can lead to an adverse change in status. However, USTR has no current plans to conduct any OCRs in 2021.

For more information on pursuing or mitigating IPR-related import restrictions, please contact attorney Lee Sandler via email or at (305) 894-1000.

Copyright © 2021 Sandler, Travis & Rosenberg, P.A.; WorldTrade Interactive, Inc. All rights reserved.

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