President Donald Trump participates in a meeting on trade with governors and members of Congress at the White House, April 12, in Washington, DC. (Chris Kleponis – Pool/Getty Images)

India would continue to remain on the U.S.’ Priority Watch List for longstanding challenges in its IP framework and lack of sufficient measurable progress, the USTR said, April 27, alleging that the country remains one of the world’s most challenging major economies in the area, writes Lalit K. Jha.

In its latest 2018 Special 301 Report, the U.S. Trade Representative has placed 12 countries on its Priority Watch List.

In addition to India, other countries on the list are Algeria, Argentina, Canada, Chile, China, Colombia, Indonesia, Kuwait, Russia, Ukraine, and Venezuela.

The Intellectual Property (IP) issues in these countries will be the subject of intense bilateral engagement during the coming year, the USTR said in its report.

Special 301 Report identifies U.S. trading partners that do not adequately or effectively protect and enforce IP rights or otherwise deny market access to its innovators and creators that rely on protection of their IP rights.

India “remains on the Priority Watch List this year for longstanding challenges in its IP framework and lack of sufficient measurable improvements, particularly with respect to patents, copyrights, trade secrets, and enforcement, as well as for new issues that have negatively affected U.S. right holders over the past year,” the USTR said.

India remains one of the world’s most challenging major economies with respect to protection and enforcement of intellectual property, it said.

Defending its decision to put India on the Priority Watch List, the USTR said the longstanding IP challenges facing U.S. businesses in India include those which make it difficult for innovators to receive and maintain patents in India, particularly for pharmaceuticals.

Among other issues include India’s enforcement action and policies that are insufficient to curb the problem, copyright policies that do not properly incentivize the creation and commercialization of content, and an outdated and insufficient trade secrets legal framework.

New and growing concerns, including with respect to reductions in transparency by India’s pharmaceutical regulator through the removal of a requirement that applicants submit information about a product’s patent status, continue to generate skepticism about whether India is serious about pursuing pro-innovation and -creativity growth policies, the USTR said.

At the same time, the report takes note of the several steps being taken by the Indian Government to improve its IP environment.

In 2017, India continued to carry out high-level initiatives involving IP, including the 2016 National IP Policy and Startup India, it said.

“While these and other Modi Administration initiatives have acknowledged the important role innovation and creativity play in India’s development, they have failed to draw a direct link to specific IP reforms that would best help achieve these goals,” the USTR observed.

“Over the past year, despite administrative actions aimed at improving India’s IP system, India has yet to address key longstanding deficiencies in its IP regime,” the report alleged.

In particular, India has yet to take steps to address longstanding patent issues that affect innovative industries.

Companies across different sectors remain concerned about narrow patentability standards, the potential threat of compulsory licensing and patent revocations, as well as overly broad criteria for issuing such licenses and revocations under the India Patents Act, it said.

“India’s overall levels of IP enforcement remain deficient, and the lack of uniform progress across the country threatens to undercut the positive steps that certain states have taken,” the report said.

“Although India has made some administrative improvements and others are in progress, overall levels of trademark counterfeiting remain high, and U.S. brand owners continue to report significant challenges and excessive delays in obtaining trademarks and efficiently utilizing opposition and cancellation proceedings, as well as quality of examination issues.”

The U.S., it said, continues to urge India to join important international treaties and agreements that could improve aspects of India’s IP regime.

China remains on the Priority Watch List for the 14thconsecutive year. Longstanding and new IP concerns merit increased attention, including China’s coercive technology transfer practices, range of impediments to effective IP enforcement, and widespread infringing activity including trade secret theft, rampant online piracy, and counterfeit manufacturing, it said.

The annual report calls on U.S. trading partners to address IP-related challenges with a special focus on the countries identified on the Watch List and Priority Watch List.