The U.S. Trade Representative's (USTR) office on Wednesday designated Ukraine a "Priority Foreign Country" that failed to protect U.S. intellectual property rights (IPR), signaling that it may consider trade sanctions against Ukraine.
"I regret that the Government of Ukraine has earned the first new Priority Foreign Country designation in 11 years due to its severely deteriorating climate for IPR protection and market access," Acting U.S. Trade Representative Demetrios Marantis said in a statement.
The official urged Ukraine "to reverse recent backsliding and swiftly resolve the problems identified today."
"This designation is the culmination of several years of growing concern over widespread IP theft, including the growing entrenchment of IPR infringement that is facilitated by government actors," the USTR said in this year's Special 301 Report, an annual review of the global state of IPR protection and enforcement.
According to the report, within 30 days from the date of this designation, the USTR will decide whether to initiate an investigation under section 301 of the Trade Act of 1974, which enables Washington to pursue sanctions against a country directly or through the World Trade Organization.
Ukraine lost its eligibility for benefits under the U.S. Generalized System of Preferences (GSP) program, which offers tariff cuts on certain goods imported from developing countries, after it was labeled a Priority Foreign Country by the USTR's office, the report said.
The USTR this year reviewed 95 trading partners and identified deterioration of the IPR protection on relevant U.S. products in 41 countries.