FC: U.S. says Ukraine turns blind eye to piracy, levies tariffs

[Declan McCullagh <declan () well com>]

[Summary: In response to the Ukraine government's "failure to enact an
optical media licensing regime that would preclude the piracy of such
products," the U.S. government has levied 100 percent tariffs on
Ukraine exports such as fuel oil, sneakers, paper, and diamonds. --Declan]

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http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=2002_register&docid=01-32231-filed

[Federal Register: January 2, 2002 (Volume 67, Number 1)]
[Notices]               
[Page 120-121]
> From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr02ja02-131]                         

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OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE

[Docket No. 301-121]

 
Determination of Action To Increase Duties on Certain Products of 
Ukraine Pursuant to Section 301(b): Intellectual Property Laws and 
Practices of the Government of Ukraine

AGENCY: Office of the United States Trade Representative.

ACTION: Notice

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SUMMARY: The United States Trade Representative (Trade Representative) 
has determined that appropriate action to obtain the elimination of the 
acts, policies, and practices of the Government of Ukraine that result 
in the inadequate protection of intellectual property rights includes 
the imposition of prohibitive duties on the annexed list of Ukrainian 
products.

EFFECTIVE DATES: A 100 percent ad valorem rate of duty is effective 
with respect to the articles of Ukraine described in the Annex to this 
notice that are entered, or withdrawn from warehouse, for consumption 
on or after January 23, 2002. In addition, any merchandise 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''.

FOR FURTHER INFORMATION CONTACT: Kira Alvarez, Office of Services, 
Investment and Intellectual Property, Office of the United States Trade 
Representative (202) 395-6864; David Birdsey, Office of European 
Affairs, Office of the United States Trade Representative, (202) 395-
3320; or William Busis, Office of the General Counsel, Office of the 
United States Trade Representative, (202) 395-3150. For questions 
concerning product classification, please contact the General 
Classification Branch, Office of Regulations and Rulings, U.S. Customs 
Service, (202) 927-2388, and for questions concerning entries, please 
contact Yvonne Tomenga, Program Officer, Office of Trade Compliance, 
U.S. Customs Service, (202) 927-0133.

SUPPLEMENTARY INFORMATION: In a notice published on April 6, 2001 (66 
FR 18,346), the Office of the United States Trade Representative 
(``USTR'') announced the initiation of an investigation under sections 
301 to 309 of the Trade Act of 1974, as amended (the Trade Act), 
regarding the Government of Ukraine's intellectual property protection 
laws and practices, including the Government of Ukraine's failure to 
use existing law enforcement authority to stop the ongoing unauthorized 
production of optical media products and failure to enact an optical 
media licensing regime that would preclude the piracy of such products. 
See 66 FR 18,346 (April 6, 2001). In a notice published on August 10, 
2001, USTR announced that the Trade Representative had determined that 
these acts, policies, and practices of Ukraine with respect to the 
protection of intellectual property rights are unreasonable and burden 
or restrict United States commerce and are thus actionable under 
section 301(b) of the Trade Act. See 66 FR 42,246 (Aug. 10, 2001). The 
notice also announced that the Trade Representative had determined that 
appropriate action to obtain the elimination of such acts, policies, 
and practices included the suspension of duty-free treatment accorded 
to products of Ukraine under the Generalized System of Preferences.
    The August 10, 2001 notice announced that further action might 
include the imposition of prohibitive duties on products of Ukraine to 
be drawn from a preliminary product list. USTR invited interested 
persons to submit written comments and to participate in a public 
hearing on September 11, 2001. Because the development of the final 
product list involved complex and complicated issues that required 
additional time, the Trade Representative determined under section 
304(a)(3)(B) of the Trade Act to extend the investigation by 3 months, 
or until December 12, 2001. The public hearing was postponed and held 
on September 25, 2001. See 66 FR 48,898 (Sep. 24, 2001).
    On December 11, 2001, the Trade Representative determined under 
section 304(a)(1)(B) of the Trade Act that appropriate action under 
section 301(b), in addition to the prior suspension of GSP benefits, 
included the imposition of 100 percent ad valorem duties on Ukrainian 
products with an annual trade value of approximately $75 million. The 
level of sanctions is based on the level of the burden or restriction 
on U.S. commerce resulting from Ukraine's inadequate protection of U.S. 
intellectual property rights.
    The Ukrainian parliament was scheduled to vote on an Optical Disc 
Licensing (ODL) law on December 20, 2001, and the Government of Ukraine 
assured in writing that it would make best efforts to ensure passage of 
the law. In light of these developments, the Trade Representative 
determined under section 305(a)(2)(A) of the Trade Act that substantial 
progress was being made and that a delay was necessary or desirable to 
obtain a satisfactory

[[Page 121]]

solution, and postponed implementation of the action until December 20, 
2001.
    On December 20, 2001, however, the Ukrainian parliament voted down 
the ODL law. Consequently, on that same day the Trade Representative 
announced that he was imposing prohibitive duties on Ukrainian products 
with an annual trade value of approximately $75 million, and announced 
the final product list on the following day.

Imposition of Prohibitive Duties

    The Trade Representative has determined that appropriate action 
under section 301(b) of the Trade Act is to impose a 100% ad valorem 
rate of duty on the articles of Ukraine described in the Annex to this 
notice, effective with respect to goods entered, or withdrawn from 
warehouse, for consumption on or after January 23, 2002. Accordingly, 
effective January 23, 2002, the Harmonized Tariff Schedule of the 
United States (HTS) is hereby modified in accordance with the Annex to 
this notice. In addition, any merchandise 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.
    The scope of this action under section 301 is governed by the HTS 
nomenclature for the preexisting HTS subheadings identified in 
parentheses for each of the new Chapter 99 subheadings in the Annex to 
this notice. The verbal product descriptions for the new Chapter 99 
subheadings in the Annex are not definitive. Issues regarding the 
classification of particular products would be decided by the U.S. 
Customs Service under its usual rules and procedures for product 
classification.

William L. Busis,
Chairman, Section 301 Committee.

Annex

    The Harmonized Tariff Schedule of the United States (HTS) is 
modified by adding in numerical sequence the following superior text 
and subheadings to subchapter III of chapter 99 to the HTS. The 
subheadings and superior text are set forth in columnar format, and 
material in such columns is inserted in the columns of the HTS 
designated ``Heading/Subheading'', ``Article Description'', and 
``Rates of Duty 1-General'', respectively.

------------------------------------------------------------------------

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                ``Articles the product of Ukraine:.........
    9903.27.01  Distillate and residual fuel oils                   100%
                 (including blended fuel oils) and wastes
                 of distillate and residual fuel oils
                 (whether or not blended) (provided for in
                 subheading 2710.19.05,
                 2710.19.10,2710.99.05 or 2710.99.10)......
    9903.27.02  Rare gases, other than argon (provided for          100%
                 in subheading 2804.29.00).................
    9903.27.03  Germanium oxides and zirconium dioxide              100%
                 (provided for in subheading 2825.60.00)...
    9903.27.04  Carbides of silicon (provided for in                100%
                 subheading 2849.20.10 or 2849.20.20)......
    9903.27.05  Other mineral or chemical fertilizers,              100%
                 containing nitrates and phosphates
                 (provided for in subheading 3105.51.00)...
    9903.27.06  Pigments and preparations based on titanium         100%
                 dioxide (provided for in subheading
                 3206.11.00 or 3206.19.00).................
    9903.27.07  Other uncoated, unbleached kraft paper and          100%
                 paperboard, in rolls or sheets, weighing
                 225 g/m2 or more (provided for
                 insubheading 4804.51.00)..................
    9903.27.08  Other footwear with outer soles of rubber,          100%
                 plastics or composition leather and uppers
                 of leather (provided for in subheading
                 6403.99.60, 6403.99.75 or 6403.99.90).....
    9903.27.09  Other footwear with outer soles of rubber           100%
                 or plastics and uppers of textile
                 materials, with open toes or open heels,
                 or of the slip-on type (provided for in
                 subheading 6404.19.35)....................
    9903.27.10  Diamonds, unsorted (provided for in                 100%
                 subheading 7102.10.00)....................
    9903.27.11  Diamonds, nonindustrial (provided for in            100%
                 subheading 7102.31.00 or 7102.39.00)......
    9903.27.12  Catalysts in the form of wire cloth or              100%
                 grill, of platinum (provided for in
                 subheading 7115.10.00)....................
    9903.27.13  Unrefined copper; copper anodes for                 100%
                 electrolytic refining (provided for in
                 heading 7402.00.00).......................
    9903.27.14  Other unwrought aluminum alloys (provided           100%
                 for in subheading 7601.20.90).............
    9903.27.15  Other refrigerating or freezing equipment;        100%''
                 heat pumps (provided for in subheading
                 8418.69.00)...............................
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[FR Doc. 01-32231 Filed 12-31-01; 8:45 am]
BILLING CODE 3190-01-P



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