By Kevin E. Noonan --
In April, Ambassador Katherine Tai, U.S. Trade Representative (USTR), issued the 2024 Special 301 Report. In a press release, the USTR stated that "[m]any of the issues highlighted in the Special 301 Report demand collaborative efforts from our allies and partners" and additionally, "[m]any of my counterparts share the goal of making sure that trade supports the interests of our people, and one of the most dangerous types of IP violations involves counterfeit goods that pose health and safety risks." Unlike last year, this version of the press release did not mention the Biden Administration's support for the WTO IP waiver, but instead noted that "the Biden-Harris Administration has continued its policy of declining to call out countries for exercising TRIPS flexibilities, including with respect to compulsory licenses, in a manner consistent with TRIPS obligations."
The press release accompanying the Report notes that its review of Ukraine (which has been the subject of criticism in prior versions of the Report's "Watch List"; see below) continues to be suspended due to "full-scale invasion of Ukraine in February 2022." It mentions removal from the Watch List of the Dominican Republic and Uzbekistan due to "significant" and "sustained" progress, respectively, in "addressing concerns" and resolving "longstanding issues" with regard to IP protection and enforcement. On the other hand the People's Republic of China (PRC) was placed on the Priority Watch List (wherein a heightened level of scrutiny is applied) due to "many serious concerns regarding IP protection and enforcement," including stakeholder concerns about the PRC's implementation of its IP laws as well as "long-standing issues like technology transfer, trade secrets, bad faith trademarks, counterfeiting, online piracy, and geographical indications." And while recognizing "progress" in India-U.S. trade policy involving "certain issues with trademark infringement investigations and pre-grant opposition proceedings" the press release notes that "numerous long-standing concerns remain" in "inadequate IP enforcement, including high rates of online piracy, an extensive trademark opposition backlog, and insufficient legal means to protect trade secrets" with this country. The press release also announces placing Vietnam on the Watch List for becoming "a leading source of online piracy" including "currently host[ing] some of the most popular piracy sites and services in the world that target a global audience."
Also included in the press release are a number of "cross-cutting issues" highlighted in this year's 301 Report, that include "counterfeit products, including counterfeit medicines, [that] can pose harms to the citizens of the trading partners where those counterfeit products are consumed"; that "the United States continues to respect its trading partners' rights to grant compulsory licenses in a manner consistent with the provisions of the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement) and the Doha Declaration"; there being "ongoing concerns related to online piracy and broadcast piracy"; "[persistent c]oncerns with the European Union's aggressive promotion of its exclusionary geographical indications (GI) policies"; and that the USTR "continues to engage trading partners to address concerns on IP protection and enforcement" that include Trade and Investment Frameworks and bilateral agreements with "Armenia, India, Kazakhstan, Kyrgyz Republic, Paraguay, Peru, Tajikistan, Thailand, Turkmenistan, Ukraine, Uzbekistan, and Vietnam."
According to the Executive Summary of the Report, "[a] priority of this Administration is to craft trade policy in service of America's workers, including those in innovation- and creativity-driven export industries." The Summary further contains the exhortation that:
The Report serves a critical function by identifying opportunities and challenges facing U.S. innovative and creative industries in foreign markets and by promoting job creation, economic development, and many other benefits that effective IP protection and enforcement support. The Report informs the public and our trading partners and seeks to be a positive catalyst for change. USTR looks forward to working closely with the governments of the trading partners that are identified in this year's Report to address both emerging and continuing concerns and to build on the positive results that many of these governments have achieved.
The Report is promulgated pursuant to Section 182 of the Trade Act of 1974, as amended by the Omnibus Trade and Competitiveness Act of 1988 and the Uruguay Round Agreements Act (enacted in 1994). The 1988 amendments were directed particularly "to provide for the development of an overall strategy to ensure adequate and effective protection of intellectual property rights and fair and equitable market access for United States persons that rely on protection of intellectual property rights" because "the absence of adequate and effective protection of United States intellectual property rights, and the denial of equitable market access, seriously impede the ability of the United States persons that rely on protection of intellectual property rights to export and operate overseas, thereby harming the economic interests of the United States." The Report "provides an opportunity to put a spotlight on foreign countries and the laws, policies, and practices that fail to provide adequate and effective IP protection and enforcement for U.S. inventors, creators, brands, manufacturers, and service providers, which, in turn, harm American workers whose livelihoods are tied to America's innovation- and creativity-driven sectors." Specific concerns motivating the Report include:
(a) challenges with border and criminal enforcement against counterfeits, including in the online environment; (b) high levels of online and broadcast piracy, including through illicit streaming devices; (c) inadequacies in trade secret protection and enforcement in China, Russia, and elsewhere; (d) troubling "indigenous innovation" and forced or pressured technology transfer policies that may unfairly disadvantage U.S. right holders in markets abroad; and (e) other ongoing, systemic issues regarding IP protection and enforcement, as well as market access, in many trading partners around the world. Combating such unfair trade policies can foster American innovation and creativity and increase economic security for American workers and families.
The Trade Representative is required under the Act to "identify those countries that deny adequate and effective protection for [intellectual property rights] (IPR) or deny fair and equitable market access for persons that rely on intellectual property protection." The Trade Representative has implemented these provisions by creating a "Priority Watch List" and "Watch List." Placing a country on the Priority Watch List or Watch List is used to indicate that the country exhibits "particular problems . . . with respect to IPR protection, enforcement, or market access for persons relying on intellectual property." These Watch Lists are reserved for countries having "the most onerous or egregious acts, policies, or practices and whose acts, policies, or practices have the greatest adverse impact (actual or potential) on the relevant U.S. products."
Pursuant to the Act the USTR reviewed "more than 100" of this country's trading partners and identified seven countries on a "Priority Watch List" (increased by one from last year) and another 20 countries on the "Watch List" (decreased by two from last year), all relating to deficiencies in intellectual property protection in these countries. The Priority Watch List in the 2024 Report includes Argentina, Chile, China, India, Indonesia, Russia, and Venezuela. On the Watch List this year are Algeria, Barbados, Belarus, Bolivia, Brazil, Bulgaria, Canada, Colombia, Ecuador, Egypt, Guatemala, Mexico, Pakistan, Paraguay, Peru, Thailand, Trinidad & Tobago, Turkey, Turkmenistan, and Vietnam (Dominican Republic and Uzbekistan being removed from the list this year).
The Report contains two Sections (on "Developments in Intellectual Property Rights Protection and Enforcement" and "Country Reports") and two Annexes on particular issues (the statutory bases of the Report, and government technical assistance and capacity building efforts).
The Report cites (and emphasizes) significant progress in several U.S. trading partners, including:
• Dominican Republic, which has made "significant progress on addressing concerns with intellectual property (IP) enforcement and transparency," including "increased enforcement actions and interagency cooperation on combating signal piracy, improved resource allocation for agencies, made publicly available enforcement-related statistics, increased the number of specialized IP prosecutors, and worked with various U.S. agencies to receive training and technical assistance."
• Bulgaria, which passed legislation directed towards imposing criminal penalties for individuals who "create conditions for online piracy."
• Peru, which amended its organized crime laws to apply to intellectual property crimes.
• India, which finalized its patent law to permit pre-grant oppositions, updates reporting of patent working requirements, and decreased reporting time for foreign applications, which the Report asserts "have the potential to reduce long-standing burdens on patent applicants."
• China, which established a new authorization procedure for foreign documents (previously subject to a lengthy apostille protocol) to shorten approval time to "a few days."
• Indonesia, whose Directorate General for Intellectual Property and enforcement authorities collaborated with foreign enforcement agencies (including INTERPOL, the U.S. Department of Justice and Korean authorities) to arrest purveyors of an illicit Internet protocol television service.
• Armenia acceded to the International Union for the Protection of New Varieties of Plants Convention, which mandates member countries to grant IP protection to breeders of new plant varieties. There are now 62 member countries to the convention.
• Saint Vincent and the Grenadines acceded to the WIPO Copyright Convention.
Continuing on a positive note, the Report identifies "illustrative best IP practices" by U.S. trading partners. These include "cooperation and coordination among national government agencies involved in IP issues is an example of effective IP enforcement," citing Saudi Arabia, Brazil, Indonesia, South Africa, and the Dominican Republic, for activities including "creat[ion of] the permanent National Committee for the Enforcement of Intellectual Property to coordinate IP enforcement" (Saudi Arabia), Brazil's National Council on Combating Piracy and Intellectual Property Crimes, Indonesia's expansion of its Intellectual Property Task Force, South Africa's coordination of agencies in enforcement raid against counterfeit goods, and the Dominican Republic's efforts to coordinate agencies for IP enforcement, cooperation and information sharing. The Report also points out "specialized IP enforcement units" in the Philippines and India.
IP awareness and educational campaigns were also discussed, including those in Spain, Algeria, the United Arab Emirates, Indonesia, Thailand, the Philippines, Uzbekistan, Kazakhstan, and Brazil, as well as "active participation of government officials in technical assistance and capacity building" in Indonesia, Morocco, Saudi Arabia, Oman, Qatar, Paraguay, the Philippines, Thailand, Kenya, Nigeria, the Dominican Republic, Peru, and Bulgaria. The important role of micro, small, and medium-sized enterprises (MSMEs) in the global economy, and efforts by U.S. trading partners (including the United Kingdom, India, Liberia, and the Dominican Republic) to provide technical and other assistance, to these entities was also mentioned.
Multilateral and bilateral initiatives are discussed in the Report. This section of this year's Report focuses on initiatives under the World Trade Organizations TRIPS Council to "cover often unexplored areas connected to IP and innovation" which included "cross-border cooperation among IP offices, research collaboration across borders, and incubators' and accelerators' support of startups operating in a cross-border environment." Also discussed were efforts by the U.S. towards a "positive" (presumably, more effective) pandemic response, mentioning a report on access to COVID-19 diagnostics and therapeutics by the U.S. International Trade Commission (see "International Trade Commission Issues Report on COVID-19 IP Waiver"). Bilateral efforts cited in the 301 Report include Trade and Investment Framework Agreements (TIFAs) with more than 50 U.S. trading partners, which include Peru, Thailand, Paraguay, Ukraine, Vietnam, India, Armenia, and a group of Central Asian countries. Regional initiatives included in the Report are the Asia-Pacific Economic Cooperation (APEC) Intellectual Property Experts Group having the theme of "Creating a Resilient and Sustainable Future for All" and "discussions with APEC economies on effective practices for enforcement against illicit streaming in a U.S.-led initiative on illicit streaming" (each of which were also cited in last year's Report). Also continued from last year are a series of workshops, including a "Roundtable on Copyright and Creativity in the Digital Economy," a "Workshop on Geographical Indications and Preservation of Common Names," one on "Leveraging Industrial Design Protections for Small-and-Medium Sized Enterprises," and a "Green Technology One Day Program." Regarding what the Report terms "trade preference programs" are the Generalized System of Preferences (GSP) program, the African Growth and Opportunity Act, the Caribbean Basin Economic Recovery Act, and the Caribbean Basin Trade Partnership Act. The Report mentions pending reviews under these programs of IP practices in South Africa and Indonesia.
Turning to specific issues of concern, trademark counterfeiting is said to harm "consumers, legitimate producers, and governments . . . particularly [with regard to] medicines, automotive and airplane parts, and food and beverages that may not be subject to the rigorous good manufacturing practices used for legitimate products." The Report accuses infringers, motivated by higher profit margins, of disregarding product quality and performance. The Report recites a litany of negative consequences to legitimate producers and their employees (including diminished revenue and investment incentives), adverse employment impacts, and reputational damage when consumers purchase fake products, as well as increased costs for firms to enforce their intellectual property rights and loss of tax revenues generated by legitimate businesses to governments. The potential for health and safety risks associated with counterfeiting are further discussed in the 2023 Review of Notorious Markets for Counterfeiting and Piracy according to the Report.
Countries particularly called out in the Report in this regard include China, India, and Turkey, from whom counterfeit "semiconductors and other electronics, chemicals, medicines, automotive and aircraft parts, food and beverages, household consumer products, personal care products, apparel and footwear, toys, and sporting goods" enter the global stream of commerce. Also involved are "transit hubs" in countries including Hong Kong, Kazakhstan, Singapore, and Turkey that distribute counterfeit goods to third-country markets that include Brazil, Kenya, Mauritius, Mexico, Nigeria, Paraguay, and Russia. Citing a 2021 Organisation for Economic Co-operation and Development (OECD) and European Union Intellectual Property Office (EUIPO) study entitled Global Trade in Fakes: A Worrying Threat, the Report states that the "global trade in counterfeit and pirated goods reached $464 billion in 2019, accounting for 2.5% of the global trade in goods for that year," with China (and Hong Kong) being the largest country of origin for counterfeit and fake goods. Also of concern in the Report is Singapore border enforcement for weakness and "lack of coordination between Singapore's Customs authorities and the Singapore Police Force's Intellectual Property Rights Branch" (concerns voiced last year and earlier) and Bangladesh as "one of the top five source economies for counterfeit clothing globally."
Counterfeit pharmaceuticals remain a particular concern as a growing problem with "important consequences for consumer health and safety [that are] exacerbated by the rapid growth of illegitimate online sales . . . [and] contributes to the proliferation of substandard, unsafe medicines that do not conform to established quality standards." Most of these goods confiscated by the U.S. were sourced from India, Singapore, and China, the Report alleges, and transshipped through China, India, Pakistan, Indonesia, the Philippines, and Vietnam. The Report also states that counterfeit U.S. brand-name medicines amount to 38% of global counterfeit medicine seizures and that "substandard or falsified medical products comprise 10% of total medical products in low- and middle-income countries" (although the Report qualifies this statement with the caveat that "it may not be possible to determine an exact figure" for the latter statistic). These trends are increasingly exacerbated by use of on-line pharmacies, with illicit providers comprising "between 67% to 75% of web-based drug merchants" according to a 2020 study. And these counterfeit items are being distributed by "legitimate express mail, international courier, and postal services to ship counterfeit goods in small consignments" rather than large cargo ships, making detection and enforcement more difficult.
The Report addresses these concerns by summarizing U.S. efforts to combat these counterfeits:
The United States continues to urge trading partners to undertake more effective criminal and border enforcement against the manufacture, import, export, transit, and distribution of counterfeit goods. The United States engages with its trading partners through bilateral consultations, trade agreements, and international organizations to help ensure that penalties, such as significant monetary fines and meaningful sentences of imprisonment, are available and applied to deter counterfeiting. In addition, trading partners should ensure that competent authorities seize and destroy counterfeit goods, as well as the materials and implements used for their production, thereby removing them from the channels of commerce. Permitting counterfeit goods, as well as materials and implements, to re-enter the channels of commerce after an enforcement action wastes resources and compromises the global enforcement effort.
The Report identifies countries such as Turkey, Pakistan, Columbia, Ecuador, Indonesia, Canada(!), and Turkmenistan as having practices that fall short of adequate efforts to stem the flow of counterfeit goods across borders.
Online and broadcast piracy are also discussed, the Report noting that "[t]he increased availability of broadband Internet connections around the world, combined with increasingly accessible and sophisticated mobile technology, has been a boon to the U.S. economy and trade." But such "technological developments have also made the Internet an extremely efficient vehicle for disseminating pirated content, thus competing unfairly with legitimate e-commerce and distribution services that copyright holders and online platforms use to deliver licensed content." Sources of online piracy mentioned in the Report include Argentina, Bulgaria, Canada, Chile, China, Colombia, India, Mexico, the Netherlands, Pakistan, Poland, Romania, Russia, Switzerland, Thailand, and Vietnam, estimated as costing the U.S. economy "at least $29.2 billion and as much as $71 billion in lost revenue each year."
A particular form of copyright piracy (particularly of music), termed "stream-ripping," is practiced (or ineffectively prevented) in Canada, Korea, Mexico, Nigeria, Russia, South Africa, Switzerland, the Report asserts. Illicit streaming devices (ISDs) "continue to pose a direct threat to content creators, sports leagues, and live performances, as well as legitimate streaming, on-demand, and over-the-top media service providers" while illicit Internet Protocol Television (IPTV) services "unlawfully retransmit telecommunications signals and channels containing copyrighted content through dedicated web portals and third-party applications that run on ISDs or legitimate devices." These technologies contribute "notable levels of piracy" in high levels in Argentina, Brazil, Canada, Chile, China, Guatemala, Hong Kong, India, Indonesia, Iraq, Jordan, Mexico, Morocco, Singapore, Switzerland, Taiwan, Thailand, United Arab Emirates, and Vietnam, with China being identified as a "manufacturing hub" for these devices and Iraq as a source of satellite receivers "pre-loaded with pirate IPTV apps." Signal theft remains a problem in Brazil, Argentina, and Honduras.
Also noted were the use of camcorders to produce expropriated contend, in Russia, India, and China, with impediments to counteracting such illicit activities found in Argentina, Brazil, Ecuador, Peru, and Russia (which don't effectively criminalize such activities), in contrast to laws now in effect in Canada, Japan, the Philippines, and Ukraine; the Report cites approvingly a report from the Asia-Pacific Economic Cooperation (APEC) on effective practices for addressing these problems.
The significance of the problem was synopsized in the Report as follows:
In addition to the distribution of copies of newly released movies resulting from unauthorized camcording, other examples of online piracy that damage legitimate trade are found in virtually every country listed in the Report and include: the unauthorized retransmission of live sports programming online; the unauthorized cloning of cloud-based entertainment software through reverse engineering or hacking onto servers that allow users to play pirated content online, including pirated online games; and the online distribution of software and devices that allow for the circumvention of technological protection measures, including game copiers and mod chips that allow users to play pirated games on physical consoles. Piracy facilitated by online services presents unique enforcement challenges for right holders in countries where copyright laws have not been able to adapt or keep pace with these innovations in piracy.
Difficulties in trade secret protection have its own subsection of the Report. The problems of adequately protecting trade secrets have arisen "in a wide variety of industry sectors, including information and communications technology, services, pharmaceuticals and medical devices, environmental technologies, and other manufacturing sectors, [that] rely on the ability to protect and enforce their trade secrets and rights in proprietary information" and include theft of "business plans, internal market analyses, manufacturing methods, customer lists, and recipes" that "are often among a company's core business assets," according to the Report. The Report states that trade secret protection (or lack of it) is a particular problem in Russia, China, and India, and "[l]ack of legal certainty regarding trade secrets also dissuades companies from entering into partnerships or expanding their business activities in these and other countries. While "[t]he United States uses all trade tools available to ensure that its trading partners provide robust protection for trade secrets and enforce trade secrets laws," according to the Report, only Taiwan was mentioned as having made successful efforts in protecting trade secrets since the last Special 301 Report.
The United States-Mexico-Canada Agreement (USMCA) has "the most robust protection for trade secrets of any prior U.S. trade agreement" according to the Report. The United States-China Economic and Trade Agreement (Phase One Agreement) has several trade secret commitments, the Report states, including "expanding the scope of civil liability, covering acts such as electronic intrusions as trade secret theft, shifting the burden of producing evidence, making it easier to obtain preliminary injunctions to prevent use of stolen trade secrets, allowing criminal investigations without need to show actual losses, ensuring criminal enforcement for willful misappropriation, and prohibiting unauthorized disclosure of trade secrets and confidential business information by government personnel or third-party experts." The Report reiterates the U.S. government's support for continued work by international organizations (including the Organisation for Economic Co-operation and Development) to support trade secret protections.
Another subsection of the Report involves "forced" technology transfer, indigenous innovation, and preferences for indigenous IP. These include the following activities, many of which involved governmental action and all of which were mentioned in the 2022 and 2023 Special 301 Reports:
• Requiring the transfer of technology as a condition for obtaining investment and regulatory approvals or otherwise securing access to a market or as a condition for allowing a company to continue to do business in the market;
• Directing state-owned enterprises in innovative sectors to seek non-commercial terms from their foreign business partners, including with respect to the acquisition and use or licensing of IP;
• Providing national firms with an unfair competitive advantage by failing to effectively enforce, or discouraging the enforcement of, U.S.-owned IP, including patents, trademarks, trade secrets, and copyright;
• Failing to take meaningful measures to prevent or to deter cyber intrusions and other unauthorized activities;
• Requiring use of, or providing preferences to, products or services that contain locally developed or owned IP, including with respect to government procurement;
• Manipulating the standards development process to create unfair advantages for national firms, including with respect to participation by foreign firms and the terms on which IP is licensed; and
• Requiring the submission of unnecessary or excessive confidential business information for regulatory approval purposes and failing to protect such information appropriately.
China is particularly recognized for such practices.
As in other years, geographical indications (i.e., country or region of origin limitations primarily for wine and foodstuffs) are discussed, specifically in the EU. This is particularly troubling for trademarks, the Report stating that "[t]he EU GI agenda remains highly concerning because it significantly undermines protection of trademarks held by U.S. producers and imposes barriers on market access for U.S.-made goods that rely on the use of common names, such as parmesan or feta." These practices are particularly troublesome for medium-sized enterprises (MSMEs), according to the Report, because their trademarks are "among the most effective ways for producers and companies . . . to create value, to promote their goods and services, and to protect their brands." In addition, the Report asserts that "[t]rademark systems offer strong protections through procedures that are easy to use, cost-effective, transparent, and provide due process safeguards" and "[t]rademarks also deliver high levels of consumer awareness, significant contributions to gross domestic product and employment, and accepted international systems of protection," all of which are impeded by EU GI practices which "may result in consumer confusion to the extent that it permits the registration and protection of GIs that are confusingly similar to prior trademarks." The Report specifically calls out EU protections for cheese varieties (including feta, danbo, and Havarti) as instances where EU protections fly in the face of these names having been used extensively throughout the world (Argentina, South Africa, and Uruguay for danbo; Australia, New Zealand, the United States, among others, for havarti), which actions undermine the benefits of international standards under the Codex Alimentarius. The resulting trade deficits between the U.S. and EU caused by these restrictions are also mentioned, wherein the EU exported more than $1.1 billion of cheese to the United States last year while the United States exported only about $8.1 million of cheese to the EU.
The EU's efforts are expanding the reach of these GIs from agricultural products and foodstuffs to "apparel, ceramics, glass, handicrafts, manufactured goods, minerals, salts, stones, and textiles," according to the Report. The EU has also used instruments of international organizations (like WIPO) through the Lisbon Agreement for the Protection of Appellations of Origin and the Geneva Act thereof to expand the reach of GIs.
While having little luck dissuading the EU from continuing and expanding its GI practices, the Report cites several bilateral agreements (with Argentina, Australia, Brazil, Canada, Chile, China, Ecuador, Indonesia, Japan, Kenya, Korea, Malaysia, Mexico, Moldova, New Zealand, Paraguay, the Philippines, Singapore, Taiwan, Thailand, Uruguay, and Vietnam, and others) that have a number of provisions aimed at curtailing some of the deleterious effects of GI protection as set forth in detail in the Report.
With regard to pharmaceuticals and medical devices and market access for U.S. products, the Report contends that "[t]he COVID-19 pandemic has highlighted the importance of pharmaceutical, medical device, and other health-related innovation, as well as a lack of widespread, equitable distribution of these innovations," including the need for fighting current as well as future pandemics. The Report thus seems to seek to strike a balance between "adequate and effective protection for pharmaceutical and other health-related IP around the world to ensure robust American innovation in these critical industries to fight" in this and future pandemics and "access to medicines in developing economies [that] is important to development itself."
The Report notes that, paradoxically while the USITC Report evinces the reality that "the price of medicines can be untenably high for some countries" another report shows that "low and middle-income countries maintain the highest tariffs on medicines and pharmaceutical inputs among the World Trade Organization (WTO) Members" and that "large developing countries" (Brazil, India, and Indonesia) have the highest tariffs for these products. Exacerbating these problems are "unreasonable regulatory approval delays and non-transparent reimbursement policies" that "discourage the development and marketing of new drugs and other medical products" according to the Report. The U.S. in the past year has monitored, enforced, or engaged with trading partners (China, Canada, Mexico, Japan and India) in efforts to remedy these impediments to efficient global access to medicines while protecting IP rights. The Report notes that stakeholders have "expressed concerns" about practices in Australia, Brazil, Canada, China, Colombia, Japan, Korea, Mexico, New Zealand, Russia, Saudi Arabia, and Turkey "on issues related to pharmaceutical innovation and market access," providing specific examples for each country.
Trademark issues are also noted in the Report for China and Indonesia or a variety of impediments for protecting trademarks, and in Brazil, Ecuador, Egypt, Spain, Turkmenistan, and Uzbekistan, which "frequently impose unnecessary administrative and financial burdens on trademark owners and create difficulty in the enforcement and maintenance of trademark rights." Formalities and "documentation requirements" (such as "obtaining traditional pen-and-ink signatures, notarized or legalized powers of attorney, and original documents") were noted for Algeria, China, Indonesia, Iraq, and the United Arab Emirates. Other countries "do not provide the full range of internationally recognized trademark protections," including Argentina, Barbados, Belarus, and Indonesia, still others have "reportedly have slow opposition or cancellation proceedings" (India, Malaysia, Pakistan, and the Philippine) or no such proceedings at all (Panama and Russia), and Bangladesh, Iraq, and South Africa have "extreme delays" in processing trademark applications.
In copyright matters, the Report cites "flawed or non-operational" copyright management organizations in several countries, naming India, Kenya and Nigeria, despite efforts in countries including the UAE to improve matters in this regard.
Software concerns included in the Report involve government use of unlicensed software (costing $46 billion globally in 2018 according to The Software Alliance). This issue is particularly noted in Argentina, China, Guatemala, Indonesia, Moldova, Pakistan, Paraguay, Romania, Turkmenistan, Uzbekistan, and Vietnam. The United States "urges trading partners to adopt and implement effective and transparent procedures to ensure legitimate governmental use of software." Under the heading of "Other Issues" the Report notes that the U.S. stakeholders have raised concerns regarding the EU's Copyright in the Digital Single Market and will continue to monitor copyright issues in the EU stemming from implementation thereof, particularly in Bulgaria, Denmark, Finland, Latvia, Poland, and Portugal.
The Report spends less time than in other years on IP and the environment (under the heading of "Intellectual Property and Sustainability) and has a more extensive section on IP and health. This section is focused (as it was last year) on the COVID pandemic and sequelae thereof. The Reports states that the United States "continues to work to fight COVID-19 and is committed to building back a better world, one that is prepared to prevent, detect, and respond to future biological threats, and where all people can live safe, prosperous, and healthy lives." These sentiments extend primarily to avoiding IP (or at least its purported costs), the Report stating that "[t]he United States recognizes the role of voluntary licensing as one mechanism to promote greater access to pandemic response products," specifically citing voluntary licensing through the Medicines Patent Pool (MPP) and licenses with generic manufacturers, with "agreements that do not require the generic manufacturers to pay a royalty to the right holder" (holding out as exemplary licenses to MPP for COVID-19 technologies through the COVID-19 Technology Access Pool (C-TAP) administered by the U.S. National Institutes of Health). The Report identifies "[n]umerous comments in the 2024 Special 301 review process [that] highlighted concerns arising at the intersection of intellectual property (IP) policy and health policy," while at the same time recognizing that "IP protection plays an important role in providing incentives for the development and marketing of new medicines," requiring "[a]n effective, transparent, and predictable IP system . . . for both manufacturers of innovative medicines and manufacturers of generic medicines." What follows these sentiments is a rather extensive discussion of how the WTO under the TRIPS regime has adapted to the dichotomy between international health concerns and IP protection, citing the Doha Declaration as an example (stating that "the United States respects a trading partner's right to protect public health and, in particular, to promote access to medicines for all") and further states that "[t]he United States also recognizes that the TRIPS Agreement provides for additional flexibilities in public health emergencies and other circumstances of extreme urgency within a Member's territory." This section also emphasizes that the United States "also recognizes that the TRIPS Agreement provides for additional flexibilities in public health emergencies and other circumstances of extreme urgency within a Member's territory" under Articles Article 30, Article 31, and Article 31bis and specifically Paragraph 6 of the Doha Declaration. What follows this in the Report is a history of the efforts of certain Member states to impose compulsory licenses on COVID-specific technologies, to which the U.S. has at least somewhat consented but also citing the ITC Report for its conclusions regarding the lack of a need for such licenses (at least at present). The Report notes that in March 2024 the WTO did not extend these provisions (although "discussions in the WTO TRIPS Council have been and will continue to be held with respect to lessons learned regarding pandemic response and preparedness"). This section concludes with a pledge that provisions of U.S. agreements with its trading partners "do not impede its trading partners from taking measures necessary to protect public health."
Perhaps paradoxically, this section is followed by one emphasizing U.S. commitment that the WTO effectively implement TRIPS provisions regarding "certain minimum standards of intellectual property (IP) protection and enforcement" for all Member states (including a discussion of those states that have not yet fully implemented these provisions) and extensions of deadlines in the Agreement for them to do so.
This general portion of the Report concludes with dispute settlement and (IP) enforcement, wherein is announced that "[t]he United States continues to monitor the resolution of concerns and disputes announced in previous Reports" and that "[t]he United States will use all available means to resolve concerns, including bilateral dialogue and enforcement tools such as those provided under U.S. law, the World Trade Organization (WTO), and other dispute settlement procedures, as appropriate" (displaying the stick that is the alternative to the policy "carrots" extended in other portions of the Report). Specifically mentioned are efforts towards China and the EU for activities set forth in other sections of the Report that the U.S. considers contrary to TRIPS IP provisions.
Section II of the Report is a detailed, country-by-country discussion for each country on the Priority Watch List and the Watch List, relating to the activities (or lack thereof) of each country that results in placement of that country on these lists.
As it has for the past several years (and across otherwise very different Administrations), the U.S. Trade Representative's 2024 Special 301 Report provides insights into both the concerns of U.S. IP rights holders and the Administration's intentions to work with other countries to increase protection for IP rights of U.S. IP rights holders. This by itself make the Report informative reading.
For additional information regarding this and other related topics, please see:
• "U.S. Trade Representative Releases 2023 Special 301 Report," May 29, 2023
• "U.S. Trade Representative Releases 2022 Special 301 Report," April 28, 2022
• "U.S. Trade Representative Releases 2021 Special 301 Report," May 23, 2021
• "U.S. Trade Representative Releases 2020 Special 301 Report," May 10, 2020
• "U.S. Trade Representative Releases 2019 Special 301 Report," April 29, 2019
• "U.S. Trade Representative Releases 2018 Special 301 Report," April 29, 2018
• "U.S. Trade Representative Issues 2017 Special 301 Report," May 4, 2017
• "U.S. Trade Representative Issues 2016 Special 301 Report," May 19, 2016
• "U.S. Trade Representative Issues 2015 Special 301 Report," April 30, 2015
• "U.S. Trade Representative Issues 2014 Special 301 Report," May 19, 2014
• "U.S. Trade Representative Issues 2013 Special 301 Report," May 30, 2013
• "U.S. Trade Representative Issues 2012 Special 301 Report," May 1, 2012
• "U.S. Trade Representative Releases Special 301 Report on Global IPR," May 4, 2011
• "U.S. Trade Representative Releases Special 301 Report on Global IPR," May 19, 2010
• "New Administration, Same Result: U.S. Trade Representative's Section 301 Report," May 6, 2009
• "Congressmen Criticize U.S. Trade Representative over Special 301 Report," July 1, 2008
• "U.S. Continues Efforts to Protect Patent Rights Abroad," April 29, 2008
Just to point out that title should be corrected to "2024 Special 301 Report" (not 2023).
Posted by: Iván Poli | June 21, 2024 at 10:00 AM