The Office of the US Trade Representative has published its annual Special 301 Report, confirming that many of our trading partners are routinely stealing America’s intellectual property and thus flouting trade rules. They have been doing so with impunity for years.
With the U.S. economy increasingly dependent on innovation, this theft is a clear and present threat to our technology, entertainment and pharmaceutical industries – to name a few. As the administration rightly stresses in the report, “the administration is resolved to call out foreign countries and expose 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.”
The report identifies China, India and Indonesia as routine violators of U.S. copyright and patent protections. It also notes that IP enforcement in other nations including Argentina, Canada, Korea, Japan, Malaysia, and Saudi Arabia is “lacking.” For example, it notes that many of these nations “do not provide adequate or effective border enforcement against counterfeit and pirated goods.” Price controls were also identified as a major problem.
By some estimates this piracy represents an estimated $500 billion a year loss of revenue to American companies. This costs jobs and reduces the investment in tomorrow’s technologies by American companies.
In other words, many nations, including some of our close allies, are free-riding at the expense of American consumers, workers, and shareholders.
It is notable that Canada has landed on the “Priority Watch List”, a level reserved this year for the worst offenders like China and Russia.
We believe in the benefits of free trade and wish to see trade barriers reduced across the globe. But this report by the USTR underscores the need for the Trump Administration to make intellectual property protections a high priority in NAFTA negotiations, as well as in negotiations with China, Japan and Korea.
Stealing of America’s intellectual property is entirely antithetical to the idea of “free trade.” We hope to see NAFTA and other trade deals resolved in a way that enhances world trade but also protects our intellectual property in the global marketplace.