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Archived updates for Monday, January 24, 2005

Taiwan Moves Off USTR's Priority Watch List

On January 18, 2005, U.S. Trade Representative Robert B. Zoellick announced the results of USTR's Intellectual Property Rights (IPR) Out-of-Cycle Reviews (OCRs) of Poland and Taiwan. As a result of the findings, Poland will remain on the Watch List, and Taiwan will be moved from the Priority Watch List to the Watch List due to the progress it has achieved.

In the 2004 "Special 301 Report" released on May 3, 2004, fifteen trading partners, including Taiwan, were placed on the Priority Watch List and thirty four trading partners, including Poland, were placed on the Watch List. The Report highlighted a series of continued concerns regarding the lack of adequate protection and enforcement of intellectual property in Poland and Taiwan.

The Trade Act of 1974 requires the Office of the US Trade Representative to identify annually those countries that deny adequate and effective protection for IPR or deny fair and equitable market access for persons that rely on intellectual property protection. Countries are placed into a hierarchy of categories, with the ranking of Priority Foreign Country reserved for the worst situations: (1) Priority Foreign Country; (2) Section 306 monitoring; (3) Priority Watch List; or (4) Watch List.

In the most serious cases, countries identified as Priority Foreign Countries can be subjected to a Section 301 investigation and face the possible threat of trade sanctions. These are countries that fail to enter into good faith negotiations or make significant progress in bilateral or multilateral negotiations to provide adequate and effective protection of IPR. Currently, one country (Ukraine) is designated to be in this category and remains subject to $75 million in sanctions. Countries that were previously designated a Priority Foreign Country but entered into good-faith negotiations and/or are making progress are placed under Section 306 monitoring; currently the People's Republic of China and Paraguay fall into this category.

Placement of a trading partner on the Priority Watch List or Watch List indicates that particular problems exist in that country with respect to IPR protection, enforcement, or market access for persons relying on intellectual property. Although the Special 301 review occurs annually each April, out-of-cycle reviews may be conducted at any time to evaluate changes and developments in particular countries.
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