[Federal Register Volume 70, Number 173 (Thursday, September 8, 2005)]
[Notices]
[Pages 53410-53412]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-17751]


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OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE

[Docket No. 301-121]


Modification of Action Under Section 301(b); Out-of-Cycle Review 
Under Section 182; and Request for Public Comment: Intellectual 
Property Laws and Practices of the Government of Ukraine

AGENCY: Office of the United States Trade Representative.

ACTION: Modification of action under Section 301(b); out-of-cycle 
review under Section 182; and request for public comment.

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SUMMARY: The United States Trade Representative (``Trade 
Representative'') has determined that an appropriate response to the 
Government of Ukraine's adoption of important improvements to its 
legislation protecting intellectual property rights (``IPR'') is to 
terminate the 100% ad valorem duties currently in place on Ukrainian 
exports. In addition, the Office of the United States Trade 
Representative (``USTR'') is conducting an out-of-cycle review 
(``OCR'') under Section 182 (commonly referred to as the ``Special 
301'' provision) of the Trade Act of 1974, as amended (``Trade Act'') 
focused on whether Ukraine has implemented fully the legislative 
improvements and has otherwise strengthened IPR enforcement. At the 
conclusion of the OCR, the Trade Representative will determine whether 
to revoke the identification of Ukraine as a priority foreign country 
(``PFC'') and accordingly to change Ukraine's status on the Special 301 
list, and whether to restore Ukraine's benefits under the Generalized 
System of Preferences (``GSP''). USTR requests written comments from 
the public concerning these matters.

DATES: The termination of increased duties is effective with respect to 
articles entered, or withdrawn from warehouse, for consumption on or 
after August 30, 2005. Comments should be submitted by 5 p.m. on 
October 14, 2005.

ADDRESSES: Comments should be addressed to Sybia Harrison, Special 
Assistant to the Section 301 Committee, and sent (i) electronically, to 
[email protected], with ``Ukraine-IPR'' in the subject line, or (ii) 
by fax, to (202) 395-9458, with a confirmation copy sent electronically 
to the email address above.

FOR FURTHER INFORMATION CONTACT: For questions concerning procedures 
for filing comments in response to this notice: Sybia Harrison, Staff 
Assistant to the Section 301 Committee, USTR, (202) 395-3419; for 
questions concerning the Special 301 out-of-cycle review: Jennifer Choe 
Groves, Director for Intellectual Property and Chair of the Special 301 
Committee, USTR, (202) 395-4510, Laurie Molnar, Director for European 
and Mediterranean Trade Affairs, USTR, (202) 395-4620, or Stephen Kho, 
Associate General Counsel, USTR, (202) 395-3150; for questions 
concerning procedures under Section 301: William Busis, Associate 
General Counsel and Chairman of the Section 301 Committee, USTR, (202) 
395-3150; and for questions concerning entries: Teiko Campbell, Program 
Officer, Office of Trade Compliance and Facilitation, U.S. Customs and 
Border Protection, Department of Homeland Security, (202) 344-2698.

SUPPLEMENTARY INFORMATION:

History of the 301 Investigation

    On March 12, 2001, the Trade Representative identified Ukraine as a 
PFC under Special 301. The PFC identification was based on deficiencies 
in Ukraine's acts, policies and practices regarding IPR protection, 
including weak enforcement, as evidenced by alarming levels of piracy 
of optical media products (such as CDs and DVDs), and the failure of 
the Government of Ukraine to enact adequate and effective IPR 
legislation to address optical media piracy. The Trade Representative 
simultaneously initiated an investigation (Docket 301-121) under 
Section 301(b) of the Trade Act in order to investigate these IPR 
protection issues. See 66 FR 18,346 (April 6, 2001).
    In August 2001, the Trade Representative determined that the acts, 
policies, and practices of Ukraine with respect to IPR protection were 
unreasonable and burdened or restricted United States commerce, and 
were thus actionable under section 301(b) of the Trade Act. As an 
initial action in response, the Trade Representative suspended GSP 
treatment accorded to products of Ukraine, effective August 24, 2001. 
See 66 FR 42,246 (Aug. 10, 2001).
    In December 2001, the Trade Representative took the additional 
action of imposing 100% ad valorem tariffs on certain Ukrainian exports 
with an annual trade value of approximately $75 million, effective 
January 23, 2002. The trade value of the action was based on the level 
of the burden on U.S. commerce resulting from Ukraine's inadequate 
protection of U.S. IPR. See 67 FR 120 (Jan. 2, 2002).
    In July 2005, USTR notified in writing representatives of U.S. 
copyright industries that, pursuant to Section 307(c) of the Trade Act, 
the suspension of Ukraine's GSP benefits would terminate unless USTR 
received a written request for a continuation from one or more 
representatives of U.S. copyright industries prior to the four-year 
anniversary of the GSP suspension (i.e., prior to August 24, 2005). 
U.S. copyright industry representatives responded in writing prior to 
August 24, 2005 by requesting that the GSP suspension remain in place 
until USTR determines that Ukraine has adequately improved IPR 
enforcement. Accordingly, the suspension of GSP benefits continued 
under Section 307(c) of the Trade Act.
    Since 2001, the Government of the United States has been working 
with the Government of Ukraine to address the IPR protection issues 
that are the subject of this investigation. In particular, the United 
States has been encouraging Ukraine (i) to improve its IPR legislation, 
and (ii) to enhance enforcement of existing IPR laws by, for example, 
shutting down pirate optical disc factories.

[[Page 53411]]

Ukraine's July 2005 Legislation and Termination of 100% ad valorem 
Duties

    On July 6, 2005, the Ukrainian parliament approved a package of 
important amendments to its Laser-readable Disc Law (the ``optical 
media amendments'') that strengthen Ukraine's licensing regime and 
enforcement capabilities to stem the illegal production and trade of 
optical media products. President Yushchenko signed the amendments into 
law on July 26, 2005, and they were formally promulgated on August 2, 
2005.
    Section 307(a) of the Trade Act authorizes the Trade Representative 
to ``modify or terminate any [Section 301] action, subject to the 
specific direction, if any, of the President * * * if * * * such action 
is being taken under Section 301(b) and is no longer appropriate.'' In 
passing the optical media amendments, the Government of Ukraine has 
addressed one of the two issues (those being inadequate IPR legislation 
and inadequate IPR enforcement) that were the basis of the PFC 
designation and the Trade Representative's finding that Ukraine's 
inadequate IPR protections were actionable under Section 301(b). The 
Trade Representative has determined that an appropriate response to 
Ukraine's adoption of the optical media amendments is to terminate the 
100% ad valorem duties that have been in place since January 2002. As 
set out in the Annex to this notice, the termination of 100% ad valorem 
duties is effective with respect to articles entered, or withdrawn from 
warehouse, for consumption on or after August 30, 2005. Prior to 
terminating the 100% ad valorem duties, USTR consulted with U.S. 
copyright industries and at this time is providing an opportunity for 
public comment.

Out-of-Cycle Review and Next Steps

    The other action previously taken under Section 301--the August 
2001 suspension of Ukraine's GSP benefits--will continue pending the 
results of the OCR of Ukraine's Special 301 status. The OCR focuses on 
whether Ukraine has fully implemented the optical media amendments and 
has otherwise improved its IPR enforcement.
    At the conclusion of the OCR, the Trade Representative will 
consider (1) whether to take action under section 182(c)(1)(A) of the 
Trade Act, which authorizes the Trade Representative to revoke the 
identification of any foreign country as a PFC at any time; and (2) 
whether to terminate the suspension of GSP benefits. As specified 
below, USTR seeks public comments in relation to the OCR and the 
possible restoration of Ukraine's GSP benefits.

Request for Public Comments

    USTR invites public comments on the following matters:
    (i) 100% ad valorem duties--Comments on the termination of the 100% 
ad valorem duties, which (as noted) is effective for entries on or 
after August 30, 2005;
    (ii) GSP benefits--Comments on the suspension of Ukraine's GSP 
benefits, including the effectiveness of the GSP suspension in 
achieving the objectives of the 301 investigation; the effects of the 
GSP suspension on the U.S. economy, including consumers; and the 
possible restoration of GSP benefits upon conclusion of the OCR; and
    (iii) OCR--Comments addressing the Special 301 status of Ukraine in 
the light of Ukraine's enforcement of its IPR laws, including a 
description of any problems with and/or improvements in IPR enforcement 
in Ukraine (including, but not limited to, implementation of the 
optical media amendments) and the effect of such problems and/or 
improvements on U.S. commerce.
    Submitters should feel free to address any or all of the above 
matters. Submitters should make their comments as detailed as possible 
and should provide all necessary information for assessing the 
assertions made in the comments.
    Comments should be submitted by 5 p.m. on October 14, 2005. All 
comments should be addressed to Sybia Harrison, Special Assistant to 
the Section 301 Committee, and sent (i) electronically, to 
[email protected], with ``Ukraine-IPR'' in the subject line, or (ii) 
by fax, to (202) 395-9458, with a confirmation copy sent electronically 
to the email address above. No submissions will be accepted via postal 
service mail.
    Documents should be submitted as either WordPerfect, MS Word, or 
text (.TXT) files. Supporting documents submitted as spreadsheets are 
acceptable as Quattro Pro or Excel files. Submissions should not 
include separate cover letters; information that might appear in a 
cover letter should be included in the submission itself. To the extent 
possible, any attachments to the submission should be included in the 
same file as the submission itself, and not as separate files. Comments 
must be in English.
    In accordance with 15 CFR 2006.15, a submitter may request that 
information contained in a comment be treated as confidential business 
information exempt from public inspection. In such case, the submitter 
must also provide a non-confidential version of the comment. For any 
document containing confidential business information, the file name of 
the business confidential version should begin with the characters 
``BC-'', and the file name of the public version should begin with the 
character ``P-''. The ``P-'' or ``BC-'' should be followed by the name 
of the submitter.

Public Inspection of Submissions

    Within one business day of receipt, non-confidential submissions 
will be placed in a public file open for inspection at the USTR reading 
room, Office of the United States Trade Representative, Annex Building, 
1724 F Street, NW., Room 1, Washington, DC. An appointment to review 
the file must be scheduled at least 48 hours in advance and may be made 
by calling Jacqueline Caldwell at (202) 395-6186. The USTR reading room 
is open to the public from 10 a.m. to noon and from 1 p.m. to 4 p.m., 
Monday through Friday.

William Busis,
Chairman, Section 301 Committee.

Annex

    I. Effective with respect to merchandise entered, or withdrawn from 
warehouse, for consumption on or after August 30, 2005, the imposition 
of 100 percent ad valorem tariffs as provided in subheadings 9903.27.01 
(affecting articles in subheading 2710.19.05, 2710.19.10, 2710.99.05 or 
2710.99.10); 9903.27.02 (affecting articles in subheading 2804.29.00); 
9903.27.03 (affecting articles in subheading 2825.60.00); 9903.27.04 
(affecting articles in subheading 2849.20.10 or 2849.20.20); 9903.27.05 
(affecting articles in subheading 3105.51.00); 9903.27.06 (affecting 
articles in subheading 3206.11.00 or 3206.19.00); 9903.27.07 (affecting 
articles in subheading 4804.51.00); 9903.27.08 (affecting articles in 
subheading 6403.99.60, 6403.99.75 or 6403.99.90); 9903.27.09 (affecting 
articles in subheading 6404.19.35); 9903.27.10 (affecting articles in 
subheading 7102.10.00); 9903.27.11 (affecting articles in subheading 
7102.31.00 or 7102.39.00); 9903.27.12 (affecting articles in subheading 
7115.10.00); 9903.27.13 (affecting articles in heading 7402.00.00); 
9903.27.14 (affecting articles in subheading 7601.20.90); and 
9903.27.15 (affecting articles in subheading 8418.69.00) of the 
Harmonized Tariff Schedule of the United States is terminated.
    II. Effective August 30, 2005, the instruction in the notice of 
January 2, 2002, 67 FR 120, that ``any merchandise

[[Page 53412]]

subject to this determination that is admitted to U.S. foreign-trade 
zones on or after January 23, 2002 must be admitted as ``privileged 
foreign status'' as defined in 19 CFR 146.41'' is terminated.

[FR Doc. 05-17751 Filed 9-7-05; 8:45 am]
BILLING CODE 3190-W5-P