USTR Declines to Name India Priority Foreign Country in Report, But Emphasizes Pharma Violations
Thirty-seven countries are included on the U.S. Trade Representative (USTR) Special 301 Watch List for 2014, with 10 designated as Priority Watch List countries. China and India are among those designated as Priority Watch List countries in the report released on April 30. The report criticizes Chinese protection and enforcement of trade secrets, and claims India is a particularly poor environment for intellectual property protection. But USTR declined to name India a Priority Foreign Country, the most severe classification of an intellectual property rights violator, despite recent speculation that the pharmaceutical industry would mount enough pressure to force that classification.
Sign up for a free preview to unlock the rest of this article
Export Compliance Daily combines U.S. export control news, foreign border import regulation and policy developments into a single daily information service that reliably informs its trade professional readers about important current issues affecting their operations.
There remains uncertainty over the India intellectual property climate across a spectrum of sectors, said USTR. “The United States continues to encourage India to strengthen civil IPR enforcement by increasing judicial efficiency and reducing court backlogs through electronic case management, fast-track procedures, specialized judges, and similar reform measures, said the report. “The United States supports India’s efforts to initiate criminal investigations and launch raids at counterfeit goods markets; combat the manufacture, sale and distribution of counterfeit medicines; initiate investigations and judicial actions against Internet piracy; and seek deterrent sentences against persons or entities engaging in copyright piracy and trademark counterfeiting.”
The Obama administration sees opportunity in engaging with a new Indian government as a result of elections there in mid-May, said a USTR official on a background conference call with reporters on April 30. USTR corroborated that stance in an April 30 blog post (here). Investment access and strengthened intellectual property protection are priorities for that renewed engagement, said the official. India remains a primary location for the manufacture, sale and distribution of counterfeit pharmaceuticals, according to the report. USTR aims to conduct an Out-of-Cycle Review of India in order to heighten scrutiny and engagement of trade practice in the country, said the official.
The International Intellectual Property Alliance (IIPA) nonetheless praised the Special 301 Report for targeting IP violations, particularly in the Indian music, publishing and software industries. "This year’s placement of India on the Priority Watch List with an Out-of-Cycle Review highlights the increasing importance of the role of IP in the development of the world’s second most populous country," said IIPA counsel in an emailed press release. "India needs to step up its efforts to ensure IP protection and enforcement in the country supports its own right[s] holders as well as those from abroad."
Chinese government entities are misusing information submitted by industry to steal trade secrets, the report said. Trade secret theft also occurs in China when employees depart companies and joint ventures fail, and through cyber intrusion and hacking, among other means, said USTR. “Such thefts are occurring not only inside but also outside China for the competitive advantage of Chinese state-owned and private companies,” says the report. “Conditions are likely to deteriorate as long as those committing such thefts, and those benefitting, continue to operate with relative impunity, often taking advantage of the theft in order to enter into unfair competition or disadvantageous business relationships with their victims.”
Geographical indicators (GI) have emerged as a USTR concern, as well, the report said. Last month, nearly half of the U.S. Senate asked the Obama administration to demand removal of the GI regulations through a Transatlantic Trade and Investment Partnership agreement (see 14040906). “The U.S. government is actively involved in promoting and protecting access to foreign markets for U.S. exporters whose products are identified by common names or generic terms, like Parmesan and mozzarella for cheese,” said the report.
Although USTR designated Ukraine a Priority Foreign Country in 2013, the report says the Obama administration will take no further action in light of recent turmoil in the country. USTR also announced the removal of the Philippines, Italy and Israel in the report. -- Brian Dabbs