In accordance with the Trade Act of 1974, the Office of the United States Trade Representative (USTR) has released its annual Special 301 Report detailing the adequacy and efficacy of intellectual property protection and enforcement protocols among international trade partners. While several countries demonstrated incremental progress, government officials confirmed that a variety of threats ranging from the theft of trade secrets to the degradation of authorized royalty management agencies continue to stalk the global marketplace.

For the first time in 11 years, the USTR was forced to create a new Priority Foreign Country designation on account of Ukraine's inability to root out the use of pirated software within its public sector and foster equitable market access for trade partners demanding strong copyright enforcement. Report authors also cited serious concerns over the misappropriation of U.S. trade secrets by Chinese nationals.

The Asian nation joins nine other countries on the USTR Priority Watch List, with 30 additional trade partners included on the standard Watch List.

"The actions reflected in this year's report send a message to all trading partners on the Priority Watch List and the Watch List that the United States is prepared to use the Special 301 process to its full effect, both to recognize positive action and, where necessary and appropriate, to identify deterioration of the IPR (intellectual property rights) protection and enforcement systems that play such a vital role in international trade," Acting U.S. Trade Representative Demetrios Marantis explained.

In terms of positive action, Canada was transferred back down to the standard Watch List this year in acknowledgement of its ongoing efforts to rehabilitate its copyright management system. At the other end of the spectrum, however, countries which pose appreciable risks and continually demonstrate an attitude of noncompliance could warrant unilateral trade sanctions from the U.S.