Degradation of IPR protection leads to trade demotion for Chile

Degradation of IPR protection leads to trade demotion for Chile U.S. Trade Representative Susan C. Schwab on Tuesday said that Chile has been elevated from 'Watch List' to 'Priority Watch List' status following a Special 301 Review that examined in detail the adequacy and effectiveness of intellectual property rights protection in the South American nation.
   The determination is the result of an 'Out-of-Cycle Review' announced in the April 2006 Special 301 Report, Schwab's office said in a statement.
   'Chile's importance as a U.S. trading partner continues to grow, due in no small part to our Free Trade Agreement,' Schwab said. 'As such, our expectations for Chile's respect of intellectual property rights are quite high. This review reflects our concern that Chile is not protecting sufficiently intellectual property. Chile has a tremendous interest in improving its IPR track record, and we look forward to working with Chile to bring that about.'
   The review concluded, in part, that Chile remains unwilling to address the concerns of patent holders, who report that Chile has authorized the marketing of patent-infringing pharmaceutical products, and has failed to provide an appropriate and effective mechanism through which patent holders may seek to prevent marketing in such cases.
   The trade representative's office remains concerned, as well, by reports that Chile has relied inappropriately on undisclosed test and other data submitted in connection with the approval of innovative drug products in order to approve generic versions of these drugs. In addition, Chile's commitment to the vigorous enforcement and prosecution of intellectual property theft of copyrighted goods appears to be significantly diminishing.
   The review revealed increased rates of pirated sound recordings, software and films, as well as an expansion of Internet-based piracy. While some Chilean government officials are attempting to address specific aspects of these problems, the political will and a comprehensive government strategy for reversing recent trends towards higher levels of infringement appear to be lacking, the office said. The concerns highlighted in this OCR are further reinforced because Chile is overdue in enacting legislation to implement certain intellectual property-related obligations reflected in the U.S.-Chile Free Trade Agreement.