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U.S. Government Issues Annual Report Naming Foreign Countries With Worst IP Protections

WASHINGTON - The Office of the United States Trade Representative (USTR) today issued its annual "Special 301" report which highlights copyright theft concerns in foreign markets, including in particular China, Russia and Canada.

The Recording Industry Association of America’s (RIAA’s) Neil Turkewitz, Executive Vice President, International, offered the following comments on the announcement.

“USTR continues to shine the light on illicit practices around the globe that must be addressed in order to expand trade in legitimate products and services. We thank them and their colleagues in other agencies for their diligence and vision in identifying such practices, and in demanding that U.S. trading partners adopt legal or enforcement reforms designed to achieve better copyright protection, particularly in connection with digital commerce. The U.S. government properly recognizes that enhancing the level of protection on the Internet is a critical objective for the U.S. creative community and for overall U.S. competitiveness. The Internet has the capacity to fuel a cultural renaissance by providing an efficient mechanism for global distribution of recorded music and other cultural materials. Unfortunately, that potential is mired in a sea of digital theft.

CHINA & RUSSIA

“As has been the case for some time, copyright theft in China and Russia continue to be strongly reflected in the report as countries on the Priority Watch List. The Chinese marketplace, long dominated by piracy, has evolved in precisely the wrong manner. The physical market was decimated by piracy, and digital distribution promised a new beginning. Unfortunately, the digital market now closely resembles its physical counterparts, with theft levels well above 90 percent, fueled principally by the deep-linking, unlicensed music services by companies such as Baidu, Sohu and Xunlei who, as major actors in the Internet space, should know better. The Chinese government has recently undertaken some enforcement actions against Baidu, and has committed to reform its legal structure to ensure that those who facilitate copyright infringement like Baidu are held to be as equally liable as those who directly engage in this theft. We look forward to seeing these reforms quickly implemented, and the establishment of conditions in China that will permit U.S. and Chinese creators alike to realize value from the popularity of the materials that they create.

“The picture in Russia is eerily similar to that in China. A physical market long dominated by piracy has now evolved into an online market dominated by piracy. And like China, problems in the Russian online market are primarily fueled by a major Internet actor—vKontakte which, like Baidu, was named as a ‘notorious market’ in USTR’s separate report highlighting piracy hotspots. vKontakte operates a music service wholly premised on the making available of infringing materials, and offers its users a easy interface for locating the infringing music of their choice. This kind of open and notorious theft has no place in today’s world, and the lack of interference from the Russian government is hardly the kind of conduct that one would expect from a country hoping to conclude WTO accession this year.

CANADA

“Canada’s inclusion in the Priority Watch List is certainly warranted, and undoubtedly a source of continued confusion and frustration. Canada is virtually alone in the developed world in failing to bring its copyright standards into line with accepted international standards for the digital age. As a direct result, it has become a haven for many unscrupulous individuals and companies wishing to cash in from providing access to illegal content. We hope that Canada’s new government, when installed, will move quickly to address this harmful anachronism.

SPAIN & ITALY

“We also highlight continuing problems in Spain and Italy. The Spanish music market has been decimated by online piracy during the past five years, fuelled by government policies that made meaningful enforcement impossible. The recent adoption of the Sustainable Economy Law is a greatly welcomed first step in addressing online theft, and we will be monitoring its implementation closely to gauge its impact. The Spanish government has presented a report to USTR outlining the fact that the law will allow them to take action against torrent sites, trackers and linking sites, as well as against sites that host illicit materials. We look to the Spanish government for prompt action, and to restore the rule of law to an environment that has been lawless for too long.

“The online piracy problem in Italy has also been severe, but the government has already taken some significant actions to address it, and the Communications authority appears poised to adopt a regulation that could, if vigorously implemented, have a significant impact in addressing Internet piracy. We will be following the situation closely, and hope to have good news to report in advance of the out-of-cycle review that USTR announced will take place sometime later this year.”

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The Recording Industry Association of America (RIAA) is the trade organization that supports and promotes the creative and financial vitality of the major music companies. Its members are the music labels that comprise the most vibrant record industry in the world. RIAA® members create, manufacture and/or distribute approximately 85% of all legitimate recorded music produced and sold in the United States.

In support of this mission, the RIAA works to protect the intellectual property and First Amendment rights of artists and music labels; conduct consumer, industry and technical research; and monitor and review state and federal laws, regulations and policies. The RIAA® also certifies Gold®, Platinum®, Multi- Platinum™ and Diamond sales awards as well as Los Premios De Oro y Platino™, an award celebrating Latin music sales.

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