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 counterfeit goods, and the piracy of copyright-protected content. Although the U.S. Government has curtailed bilateral engagement with Russia on a myriad of issues in response to Russia's actions in Ukraine, the United States continues to monitor Russia's progress on these and other matters through appropriate channels.

UKRAINE

Ukraine is on the Priority Watch List in 2015. Ukraine was designated a Priority Foreign Country (PFC) in the 2013 Special 301 Report. As described in that report, the three grounds for Ukraine's PFC designation were: (1) the unfair, nontransparent administration of the system for collecting societies, which are responsible for collecting and distributing royalties to U.S. and other rights holders; (2) widespread (and admitted) use of illegal software by the Ukrainian government agencies; and (3) failure to implement an effective means to combat the widespread online infringement of copyright and related rights in Ukraine, including the lack of transparent and predictable provisions on intermediary liability and liability for third parties that facilitate piracy, limitations on such liability for Internet Service Providers and enforcement of takedown notices for infringing online content. Following Ukraine's designation and pursuant to statute, the Office of the U.S. Trade Representative conducted an investigation under Section 301 of Ukraine's IPR acts, policies, and practices, which concluded in March 2014. The U.S. Trade Representative determined that while IPR problems persisted, no adverse actions would be taken against Ukraine because of the political situation in Ukraine at that time. (See Notice of Determination in Section 301 Investigation of Ukraine, 79 FR 14326 (March 13, 2014)). The 2014 Special 301 Report, published a few weeks later, reiterated the severe deficiencies in Ukraine's IPR protection and enforcement.

The three problems identified in the 2013 Special 301 Report have not been resolved. However, in contrast to the period of time leading up to the PFC designation, in the past year the Government of Ukraine has invested additional effort in tackling these problems, in conjunction with other economic reforms. With respect to improving the administration of collecting societies, there is active engagement on legislative reform. No legislation has been passed, however, and the government still accredits "rogue" collecting societies, i.e., societies which do not actually represent rights holders.

With respect to the use of unlicensed software by Ukrainian government agencies, the government reports that some agencies have transitioned to authorized software, but it has not institutionalized any mechanisms to ensure a uniform and permanent transition to use of authorized software.

With respect to improving the government's response to online infringement, Ukrainian officials have participated in law enforcement training, engaged in at least one enforcement action, and 55