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The 2005 "Special 301" annual review examines in detail the adequacy and effectiveness of intellectual property rights (IPR) protection in 90 countries. Based on a lengthy process of information-gathering and analysis, the United States Trade Representative (USTR) has identified 52 countries that are designated in the categories of Priority Foreign Country, Section 306 Monitoring, Priority Watch List, or Watch List. The Special 301 Report reflects the Administration's resolve to take consistently strong actions under the Special 301 provisions of the Trade Act.

This Administration is determined to ensure the adequate and effective protection of intellectual property and fair and equitable market access for U.S. products. The designations and corresponding requisite measures announced today result from close consultations with affected industry groups, other private sector representatives, and Congressional leaders, and demonstrate the Administration's commitment to use all available methods to resolve IPR issues.

Addressing weak IPR protection and enforcement in China continues to be one of the Administration's top priorities. These IPR issues, outlined in the China section of the Special 301 Report, are critical in light of the rampant counterfeit and piracy problems that plague China's domestic market and the fact that China has become a leading exporter of counterfeit and pirated goods to the world. In the China section of the Special 301 Report, we are announcing the results of the out-of-cycle review conducted in early 2005. This year's Special 301 Report also sets forth the United States' plan to work with U.S. industry and other stakeholders to further build a factual record and to develop arguments with an eye toward utilizing World Trade Organization (WTO) procedures to bring China into compliance with its WTO Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement) obligations, to invoke the transparency provisions of the TRIPS Agreement, to elevate China to the Priority Watch List, and to maintain Section 306 monitoring. We will be monitoring closely China's IPR activities throughout the coming year.

USTR notes the continued need for Ukraine to take effective action against significant levels of optical media piracy and to implement intellectual property laws that provide adequate and effective protection. As a result, Ukraine will continue to be designated a Priority Foreign Country, and the $75 million in sanctions, first imposed on Ukrainian products on January 23, 2002, will remain in place. Ukraine's failure to protect IPR jeopardizes its efforts to join the WTO and undermines its ability to attract trade and investment. The United States notes with optimism, however, that Ukraine has recently renewed efforts to enact needed optical media legislative amendments, and has expressed its commitment to resolving IPR issues. The United States encourages Ukraine to enact necessary IPR laws and regulations as well as increase its enforcement efforts to combat piracy, and today announces the commencement of a Special 301 out-of-cycle review to monitor Ukraine's progress in providing effective copyright protection and IPR enforcement.