FOR IMMEDIATE RELEASE
May 11, 2000

Coalition for Intellectual Property Rights (CIPR) Executive Policy Chair Mary Ann Alford stated today that the placement of Russia on a list of countries that the United States claims fails to adequately protect intellectual property rights (IPR) underscores the vital importance intellectual property (IP) protection plays in both attracting foreign investment and maintaining a sound economic system based on private enterprise.

Russia was placed on the “Special 301 Priority Watch List” by United States Trade Representative (USTR) Charlene Barshefsky in her annual review of intellectual property protection by U.S. trading partners.  Placement on the “Watch List” is one of the first steps in a process that could ultimately lead to retaliatory trade sanctions by the United States.

”IPR violations not only hurt businesses in Russia, but cost the Russiangovernment billions of rubles in uncollected revenues from counterfeit products evadingtaxes and duties,” said Alford.  “IPR violations are barriers to new investment and impede Russia’s efforts to join the World Trade Organization.

The USTR report states that in Russia, despite “commendable official efforts to improve the enforcement climate,” criminal enforcement of IPR remains minimal.  The report specifically cites the lack of protection of well-known marks and the unauthorized production of CDs and CD-ROMs as “serious and growing problems.”

Under Section 301 of the U.S. trade law, USTR is required to report to the U.S. Congress each year and identify those countries that do not adequately protect the rights of intellectual property holders.  This report is called the “Special 301 Annual Review.”

USTR places countries on a “301 Watch List” that warrant “special attention” because they maintain IP practices or barriers that are a concern to the U.S.  Countries are placed on a “Priority Watch List” if the U.S. believes that their policies and practices need “active work” for resolution and close monitoring.  Those countries with the most “onerous or egregious acts, policies or practices” resulting in the greatest adverse impact on U.S. producers are designated by USTR as “Priority Foreign Countries.”  These countries are potentially subject to a Section 301 investigation and, ultimately, to retaliatory trade sanctions by the United States.

Thirty-nine countries were placed on the USTR “Watch List” this year with Latvia, Lithuania and Kazakhstan appearing for the first time.  Russia and Ukraine, as in previous years, were placed on the USTR “Priority Watch List.”  However, in the May 1 report, USTR identifies Ukraine for potential “Priority Foreign Country” status.  According to the USTR report, the United States is working closely with Ukraine to improve Ukraine’s IPR regime; however, if substantial progress is not made by August 1, 2000, Ukraine will be identified as a “Priority Foreign Country.”

CIPR, a coalition of major international firms, business associations, and professional groups has been working with Patent and Trademark Office (PTO) directors and other senior officials in Russia and other CIS countries, and the Baltics, on addressing a number ofproblems, including those raised in the USTR 301 Special Report.  “Under Dr. Alexander Korchagin, Rospatent has been a leader in efforts to strengthen IPR enforcement in Russia, and progress has been made in improving IPR protection in Russia,” stated CIPR Executive Policy Chair Alford.  “However, the report accurately highlights the significant problems that still remain in protecting foreign and domestic IP owners in Russia, including criminal enforcement, counterfeit products and protection of well-known marks.”

“The addition of Latvia and Lithuania, as well as Kazakhstan, to the Watch List now means that 12 of the 15 countries of the former Soviet Union have been cited by USTR for inadequate intellectual property protection,” added Alford.  “Clearly, much work remains to be done.  Through combined public-private efforts, these problems can be overcome and Russia and other CIS and Baltic countries can establish effective and responsive IPR enforcement regimes.”

In announcing the 2000 annual review, USTR Ambassador Charlene Barshefsky warned that the Clinton administration “remains concerned about certain failures to comply fully with WTO agreements” and would uphold its “commitment to aggressive enforcement of intellectual property rights.”

“More than ever, enforcement and implementation are the keys to protecting intellectual property,” said Tim Trainer, President of the International AntiCounterfeiting Coalition (IACC).  “It is not enough that a country’s laws comply with international obligations on paper.”  IACC is an Associate Member of CIPR.

CIPR is a private-public partnership working to improve the protection and enforcement of industrial intellectual property rights in the Baltic States, Russia, Ukraine, Kazakhstan and other CIS countries.  CIPR activities and resources focus at the various levels of government and include legislative initiatives; enforcement efforts; legal, judicial and regulatory reform; economic and opinion research; public education; and, coalition building among both the public and private sectors.

CIPR provides support to initiatives by public officials, regulators and legislators who are committed to reforming and advancing intellectual property rights; building transparent, non-discriminatory and aggressive enforcement regimes; and, adherence to international intellectual property conventions and treaties.  The state Patent and Trademark Office (PTO) Directors-General from Belarus, Kazakhstan, Kyrgyzstan, Latvia, Lithuania, Moldova, Russia and Ukraine officially support CIPR and actively participate in the Coalition’s programs and activities. CIPR also cooperates with the World Intellectual Property Organization (WIPO), United Nations Economic Cooperation Commission and World Customs Organization (WCO), among others.  CIPR is accredited with formal Observer Status by the Intergovernmental CIS Interstate Council on Industrial Property Protection.

The full USTR 2000 Special 301 Report can be downloaded from USTR’s website at www.ustr.gov/new/special.html.