The 2009 USTR Special 301 Report has moved Canada from the basic 'Watch List' of countries with records of IP abuse to the 12-strong 'Priority Watch List' of those with deeper causes for concern.
The USTR said that the decision reflected 'increasing concern about the continuing need for copyright reform, as well as continuing concern about weak border enforcement.' As a consequence, Canada has become the only developed Western democracy on the Priority Watch List a distinction that is likely to trouble its trading partners. USTR IP and innovation assistant Stanford McCoy admitted that there had been much debate over the decision. 'Canada has never been put on the Priority Watch List before,' he said. 'The decision was not an easy one but we believed that high standards are appropriate in Canada.'
The US Trade Representative himself, Ron Kirk, said: 'As US rights holders, businesses and workers suffer losses from international piracy, counterfeiting, and other forms of IP theft, the Special 301 Report provides a critical policy tool for focusing on urgent problems that undermine one of America's great strengths in the global economy our innovation and creativity. In this time of economic uncertainty, we need to redouble our efforts to work with all of our trading partners even our closest allies and neighbours such as Canada to enhance protection and enforcement of IP Rights in the context of a rules-based trading system.'
Kirk also raised concerns over the influence of the economic crisis on China's commitment to IP Rights. While patent activity has continued to increase there, Kirk said that IP officials have let the innovation community down by proposing softer enforcement measures in order to preserve jobs. Russia was also criticised for failing to meet the terms of a bilateral IP Agreement sealed with the US in 2006. One country, though, made a breakthrough: South Korea was removed from the Watch List, marking the first time it had not appeared on either that or the Priority List in the report's history.
Several US-based IP groups have welcomed the USTR's decision to downgrade Canada. Eric H Smith, President of the International Intellectual Property Alliance (IIPA), said in a statement: 'Canada remains woefully behind the rest of the developed world (and many countries in the developing world as well) [and] needs to act now to address long-standing deficiencies in its system for legal enforcement of IP Rights.'
