{"id":1794,"date":"2023-11-22T19:51:54","date_gmt":"2023-11-22T19:51:54","guid":{"rendered":"https:\/\/verywellsecurity.com\/?p=1794"},"modified":"2023-11-22T19:51:56","modified_gmt":"2023-11-22T19:51:56","slug":"digging-into-the-ustrs-2023-special-301-report-on-intellectual-property-ip-theft","status":"publish","type":"post","link":"https:\/\/verywellsecurity.com\/en-us\/cyber-security\/digging-into-the-ustrs-2023-special-301-report-on-intellectual-property-ip-theft\/","title":{"rendered":"Digging Into the USTR\u2019s \u201c2023 Special 301 Report\u201d on Intellectual Property (IP) Theft"},"content":{"rendered":"<figure style=\"width: 1870px\" class=\"wp-caption alignnone\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/verywellsecurity.com\/wp-content\/uploads\/2023\/09\/security-protection-anti-virus-software-60504.jpeg\" alt=\"Security\" width=\"1880\" height=\"1253\" \/><figcaption class=\"wp-caption-text\">Security<\/figcaption><\/figure>\n<p>American Intellectual Property (<a href=\"https:\/\/welcometobora.com\/glossary\/intellectual-property\/\">IP<\/a>) Theft is up this year. Luckily, there\u2019s a watchdog for that, and this year, they had a lot to say.<\/p>\n<p>Every year, the Office of the United States Trade Representative (USTR) publishes an update on trade barriers to U.S. companies due to intellectual property (IP) laws. Known as the\u00a0<a href=\"https:\/\/ustr.gov\/sites\/default\/files\/2023-04\/2023%20Special%20301%20Report.pdf\">Special 301 Report<\/a>, it\u2019s been around since 1989 and lists its &#8220;Priority Foreign Countries&#8221;, or countries judged to be a threat due to inadequate intellectual property laws.<\/p>\n<p>Let\u2019s dig into the issue of American IP Theft and what this 2023 report brings to the table.<\/p>\n<h2>The State of American IP Theft in 2023<\/h2>\n<p>The<a href=\"https:\/\/www.iprcenter.gov\/\">\u00a0National Intellectual Property Rights<\/a>\u00a0Coordination Center (IPRCC) reported that:<\/p>\n<ul>\n<li>Cases against IP Theft are up by 21%<\/li>\n<li>Indictments increased by 99%<\/li>\n<li>Convictions are up by 29%<\/li>\n<\/ul>\n<p>And on the whole, domestic IP Theft has gone from costing us (only) $ 822.3 million to a whopping 1.12 billion. That\u2019s an increase of 36%.<\/p>\n<p>It doesn\u2019t take another annual report to put the pieces together. We\u2019re in the spike of the digital revolution, taking on more hyper-distributed environments, hybrid work ecosystems, and computing complexity than ever before. The attack surface has\u00a0<em>blown up<\/em>. Zero Trust is the new watchword, and data protection is more critical than ever.<\/p>\n<p>Amid all this confusion, our trade secrets \u2013 critical in many ways not only to our bottom line but to National Security \u2013 are getting stolen from right under our noses. Here\u2019s how.<\/p>\n<h2>How IP Theft Works<\/h2>\n<p>According to data security company Cyberhaven,\u00a0<a href=\"https:\/\/www.cyberhaven.com\/guides\/top-ip-theft-statistics\">IP Theft<\/a>\u00a0happens in the following ways;<\/p>\n<ol>\n<li><strong>Unauthorized Access |<\/strong>\u00a0Hackers break into a business\u2019 information systems \u2013 the center of data and data management \u2013 by compromising access credentials. It is then that they carefully exfiltrate sensitive information, like trade secrets. However, sometimes proprietary information is publicly accessible (and the company doesn\u2019t even know it). That\u2019s why all the data doors need to be watched.<\/li>\n<li><strong>Misappropriation of Disclosures |<\/strong>\u00a0It\u2019s often beyond the bounds of the law to disclose sensitive information to third parties, such as in a business deal or bidding war. Not everyone honors the law.<\/li>\n<li><strong>Misuse by Employees |\u00a0<\/strong>Good employees can go bad, especially under economic pressure. External threat\u00a0<a id=\"_Int_2wDkRxHh\"><\/a>actors prey on workers who have recently experienced layoffs, and internal discontent can lead to those closest divulging a company\u2019s secrets.<\/li>\n<\/ol>\n<p>Now that we know what\u2019s being done, let\u2019s discover this year\u2019s top offenders.<\/p>\n<h2>Key Points of the 2023 Special 301 Report<\/h2>\n<p>The 2023 Special 301 Report documents the USTR\u2019s findings of more than 100 trading partners and represents intensive global research and cross-collaboration.<\/p>\n<h2>Who Made the Priority List?<\/h2>\n<p>By law, the USTR must provide a list of countries that do not provide &#8220;adequate and effective&#8221; protection of intellectual property rights or &#8220;fair and equitable market access to United States persons that rely upon\u00a0<a href=\"https:\/\/books.google.com\/books?id=jET8hh-48PAC\">intellectual property rights<\/a>&#8220;. Countries that made this year\u2019s watchlist include:<\/p>\n<ul>\n<li>Argentina<\/li>\n<li>Chile<\/li>\n<li>China<\/li>\n<li>India<\/li>\n<li>Indonesia<\/li>\n<li>Russia<\/li>\n<li>Venezuela<\/li>\n<\/ul>\n<p>And 18 more, enumerated in the report.<\/p>\n<p>This is the equivalent of a diplomatic nudge to \u201cget on the ball\u201d in terms of IP regulation and enforcement. As stated on the\u00a0<a href=\"https:\/\/ustr.gov\/about-us\/policy-offices\/press-office\/press-releases\/2023\/april\/ustr-releases-2023-special-301-report-intellectual-property-protection-and-enforcement\">official USTR website<\/a>, \u201cThese countries will be the subject of particularly intense bilateral engagement during the coming year.\u201d Not doing so could lead to potentially damaging economic outcomes down the road.<\/p>\n<p>Now, let\u2019s dig into some of the highlights of the report.<\/p>\n<h2>Concerns Over Online Piracy<\/h2>\n<p>Ongoing concerns over both online and broadcast piracy listed in the report included illicit streaming devices (and related piracy apps), stream-ripping, pirated content being distributed by cable providers, and illegal Internet Protocol television (IPTV) services. Stakeholders in the entertainment industry and other creative sectors continue to underscore that sales of their content are intrinsic to their livelihoods. No trade secrets here, but illicit IP capture all the same \u2013 as well as a dent to the nation\u2019s economy\u00a0<em>and<\/em>\u00a0the\u00a0<a href=\"https:\/\/www.trade.gov\/media-entertainment\">world\u2019s largest industry<\/a>.<\/p>\n<h2>Major Legal Reforms<\/h2>\n<p>Thailand gets kudos for amendments to the Copyright Act, in force as of August 2022. Vietnam receives similar praise for its own amendments to the IP Code, in effect as of this past January. And Nigeria ranks highly for adopting the Copyright Act, 2022 in March of 2023. For all the \u201cone step(s) back\u201d, this is surely \u201ctwo steps forward\u201d. Or three.<\/p>\n<h2>China Draws Concern<\/h2>\n<p>IP protection and enforcement is touch-and-go when it comes to our (<a href=\"https:\/\/www.bloomberg.com\/graphics\/2023-mexico-china-us-trade-opportunity\/\">typically<\/a>) highest trading partner. Right holders have expressed concern over the adequacy and effectiveness of laws securing intellectual property, such as in China\u2019s handling of the Copyright Law, Patent Law, Criminal Law, and IP protections in general. Concerns also abound about \u201clong-standing issues\u201d like counterfeiting, technology transfer, trade secrets, bad faith trademarks, and the like.<\/p>\n<h2>Bulgaria Makes the List<\/h2>\n<p>Bulgaria failed to properly investigate and prosecute instances of online piracy cases, allowing criminal investigations and even prosecutions to proceed with just a subset of the available evidence. They also failed to properly address these shortcomings. For that reason, they made the 2023 Priority List, with the USTR set to review them further to see if they make any progress towards compliance.<\/p>\n<h2>Belarus Legalizes Illegal Activity<\/h2>\n<p>In Belarus, you can now legally use certain copyrighted works\u00a0<em>unlicensed<\/em>\u00a0if the right holder belongs to a foreign state \u201ccommitting unfriendly actions\u201d. This is open for interpretation, which makes it such a sandpit. Additionally, it allows the Belarusian government to keep any royalties from said unlicensed usage and divert them to their general coffers (or the Lukashenka regime). They are also on the Watch List as a sanction for supporting Russia in their unprovoked invasion of Ukraine.<\/p>\n<h2>IP Theft, Cybersecurity, and Commerce<\/h2>\n<p>Now in its 34<sup>th<\/sup>\u00a0year, the USTR\u2019s Special 301 Report provides another finger on the pulse of (what is now) digital crime. Perhaps the stuff of manila envelopes and illicit meetings in the report\u2019s early years, the war on IP Theft is now fought largely on the battleground of digital dark alleyways.<\/p>\n<p>And that moves cybersecurity up to a position of prominence, if not supremacy. Once a \u201ckey part of business\u201d, cybersecurity \u2013 data protection, IP theft monitoring and detection, malware prevention, and the like \u2013 is now business itself.<\/p>\n<p>Now, a modern company cannot do business without a digital presence. Now, a company\u2019s ability to stay viable for the next<em>\u00a0year\u00a0<\/em>(let alone 30) is based on its ability to secure its assets in cyberspace. And now, it\u2019s understandable that countries whose economies rely largely on multinational corporations would only want to play ball with those willing to play by the same rules.<\/p>\n<p><strong>Author Bio:<\/strong><\/p>\n<p>An ardent believer in personal data privacy and the technology behind it, Katrina Thompson is a freelance writer leaning into encryption, data privacy legislation and the intersection of information technology and human rights. She has written for <a href=\"https:\/\/www.welcometobora.com\/\" target=\"_blank\" rel=\"noopener\">Bora<\/a>, Venafi, Tripwire and many other sites.<\/p>\n","protected":false},"excerpt":{"rendered":"","protected":false},"author":1,"featured_media":1703,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13,6],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.13 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Digging Into the USTR\u2019s \u201c2023 Special 301 Report\u201d on Intellectual Property (IP) Theft<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/verywellsecurity.com\/en-us\/cyber-security\/digging-into-the-ustrs-2023-special-301-report-on-intellectual-property-ip-theft\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta 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