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Protecting Intellectual Property Worldwide

THE U.S. GOVERNMENT signaled an increased emphasis on intellectual property (IP) protection and enforcement worldwide with the recent appointment of Victoria Espinel to serve as the first Intellectual Property Enforcement Coordinator, a position created by legislation last year. The U.S. Patent and Trademark Office (USPTO) has created eight IP attaché positions in the past five years, and the Department of Justice (DOJ) has established two Intellectual Property Law Enforcement Coordinator (IPLEC) positions, all of whom serve in U.S. embassies overseas. The attachés work full time on IP in coordination with other federal agencies, U.S. industry, and foreign counterparts. The IPLECs are federal prosecutors with IP expertise; they are stationed in Bangkok, Thailand; and Sofia, Bulgaria.

The U.S. Government Accountability Office (GAO) recently examined IP issues at four posts in three countries—Beijing and Guangzhou, China; New Delhi, India; and Bangkok, Thailand—to assess U.S. IP-protection efforts. The GAO concluded in its report on the issue that there is more work to be done.

China, India, and Thailand continue to be “havens for the production and sale of counterfeit and pirated goods,” the GAO found.

One sign of the lack of progress is that these countries have been designated by the U.S. Trade Representative as Priority Watch List countries, which means they are not providing adequate IP protection or enforcement.

Another issue cited by the GAO is that IP enforcement efforts taken by the governments of these countries tend to be half measures that lack real impact. For example, U.S. officials interviewed in India by the GAO said 23 Indian states have created specialized IP units within their police forces, but only a few of the units have actually become operational. In addition, Thailand established a “specialized IP court,” but the U.S. embassy in Thailand reported that most convictions result in minimal sentences, such as small fines or community service.

The report says that enforcement is particularly weak outside of major commercial centers of the countries. For instance, U.S. officials in China told the GAO that cases of IP enforcement are more common in Beijing and Shanghai than in other parts of the country, and officials in India noted significant variations in the level of enforcement among India’s 28 states.

A lack of knowledge among police, prosecutors, and judges creates a further impediment, according to the GAO. “The U.S. embassy in India has noted that many government prosecutors lack even a basic awareness of IP rights,” the report says.

In Thailand, the Thai police are uncertain what to do after a raid and are reluctant to do the paperwork necessary to turn a strong case over to a prosecutor, and in China officials noted that historically, Chinese judges were not required to have law degrees, and many judicial appointees are former army officers.

“While some U.S. officials we interviewed noted that China has increased the requirements for judges in recent years, the officials said that there continues to be a great deal of inconsistency in judges’ knowledge level and competency,” according to the report.

GAO identified weak IP laws and regulations in the countries as a problem despite progress in recent years. The report cited India’s system for challenging patent applications. Patents cannot be granted until all challenges to the application are resolved, the report notes, but India’s patent law does not set a time frame in which such challenges can be brought against a patent application. “Thus, parties can file sequential challenges to significantly delay patent approvals,” the GAO says.

The U.S. embassy in Thailand told the GAO that there is not a formal system in place there to prevent generic drug producers from being given approval to bring their products to market while the originals are still under patent. The report also said China’s restrictions of the number of foreign films that may enter the market annually (about 20), drives demand for pirated versions because it minimizes legitimate access.

As a part of its study, the GAO talked not only with U.S. officials but also with representatives from the private sector. Despite some of the problems cited already, there was a general sense among those interviewed that the trend line was in the right direction. They said that they expect to see a greater emphasis placed on strong IP enforcement in these countries, since they are all increasingly striving to be centers of innovation, and they recognize domestic protection of IP is important for their economic growth.