2016 USTR List Of ‘Notorious’ Markets: Stream Ripping, Taobao And Switzerland 21/12/2016 by William New, Intellectual Property Watch 1 Comment Share this:Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Facebook (Opens in new window)Click to email this to a friend (Opens in new window)Click to print (Opens in new window)The United States Trade Representative’s office today released its annual “notorious markets” for intellectual property-infringing goods, with a list of 21 online and 12 physical markets worldwide. Many of the online sites are based across Europe, including several in Switzerland, but also in Russia and China as in the past. A big feature is China’s Taobao website, and a focus on new methods like stream ripping. The 27-page USTR 2016 ‘Out-of-Cycle’ Notorious Markets report is available here [pdf]. This is the sixth year of the report, which grew out of the USTR Special 301 process for assessing foreign protection of US intellectual property. Technology in the field is ever-changing, and this year USTR highlighted “emerging models,” the official said, like stream ripping, in which licensed streaming content is recorded and redistributed without authorisation, and piracy apps. A popular stream-ripping site, youtube-mp3.org, has been added to the list. But the report appears to have stepped back from last year’s inclusion of domain name registrars (IPW, North America, 6 March 2016). Perhaps the biggest name in this year’s list is Taobao.com of Alibaba in China, which was relisted despite company claims of progress. “The Taobao.com e-commerce platform is an important concern due to the large volume of allegedly counterfeit and pirated goods available and the challenges right holders experience in removing and preventing illicit sales and offers of such goods,” the report states. A USTR official said in a call with journalists that they are seeking more information from the Alibaba company about what it is doing, but said, “Ultimately what we’re seeing is just not enough progress.” “While recent steps set positive expectations for the future, current levels of reported counterfeiting and piracy are unacceptably high,” the report says. “Not only do counterfeit and pirated goods pose a grave economic threat to US creative and innovative industries, undermining the Chinese and global market for legitimate US products, substandard counterfeits such as auto parts pose a potential public health threat to unsuspecting consumers.” Also back on the list this year is The Pirate Bay, whose re-emergence is of “symbolic importance,” the report says. The USTR report does not dwell in subtle questions of access to knowledge or changes in society’s way of using and sharing information. The report makes a point of mentioning positive developments wherever they were found, including the closure of problem markets or new national laws to improve enforcement. The physical markets it mentions are from every continent, some repeats and some new. The report gives an example of KAT (Kickass Torrents), which it says was “was allegedly one of the most popular and lucrative illegal piracy sites in the world until it was taken down by a US law enforcement action in cooperation with foreign law enforcement agencies. The principal operator was arrested and indicted. Following the enforcement action against KickassTorrents, another popular piracy site, Torrentz.eu, shut down voluntarily.” Perhaps a surprise country linked to several online markets is Switzerland. The report refers to three, including Private Layer-hosted Sites, including The-Watch-Series.to and Projectfree-tv.to. “This group of websites, all hosted by Switzerland- and Panama-based Private Layer, is an example of the popularity among a wide variety of pirate sites of certain Swiss hosting services,” it says. “Switzerland has announced plans to close a loophole in its law that restricts enforcement against pirate sites. However, at this time, right holders report that Switzerland is an increasingly popular host country for such sites.” Much of the information used by USTR to identify markets comes from US industry. The report is not legally binding, nor does it carry any direct sanctions for being listed, but USTR points out that it can lead to criminal action against owners of the markets. “Tens of millions of American jobs and several trillion dollars of our gross domestic product rely on American creative and innovative industries,” USTR Michael Froman said in a statement. “The marketplaces, tactics, and schemes that undermine and threaten America’s creative industries change quickly and require our constant attention. Our Notorious Markets List highlights key examples of online and physical markets all over the world that are linked to significant infringement of American businesses’ intellectual property rights. The 2016 List takes stock of emerging infringement models and adds stream-ripping sites and piracy apps to the list of the most damaging digital marketplaces.” “This Notorious Markets List illustrates the seriousness of copyright piracy and trademark counterfeiting in online marketplaces,” said Froman. “The 2016 List underscores the need for accountable governments everywhere to take on these forms of piracy and counterfeiting at every stage of the global supply chain to prevent final products that put health and safety of end-consumers at risk.” The incoming Trump administration is predicted by many to be more aggressive on enforcement. It remains to be seen how they handle the issues of Special 301 and the notorious markets. Industry Hails Report David Hirschmann, president and CEO of the US Chamber of Commerce’s Global Intellectual Property Center, issued a statement about the report: “Today’s report on notorious markets underscores the growing problem we face in a global economy where counterfeiting and piracy have exploded in recent years. According to the latest statistics from the OECD and the U.S. Chamber’s own global counterfeiting report, the counterfeit good trade has almost doubled since 2008, accounting for an estimated $461 billion annually. These numbers represent a very real threat to legitimate businesses, millions of jobs, and the safety and security of billions of consumers around the globe. “Identifying the sources of the problem is half the battle; USTR’s report provides valuable intel governments can use to address these issues in a coordinated manner. The business community stands ready to work with partners around the world to tackle these challenges that threaten the safety, validity, and access of global markets.” Recording Industry Association of America (RIAA) Chairman and CEO Cary Sherman commented in a statement: “We appreciate the important work of Ambassador Froman and his staff in highlighting some of the worst-of-the-worst sites that traffic in unauthorized music and other creative works. The multitude of harms committed by these markets go far beyond the immediate negative impact on the livelihoods of the music community, and include threatening jobs, undermining economic growth, deceiving consumers, and jeopardizing a key US competitive advantage – American creativity.” “In particular,” Sherman added, “we are especially grateful that USTR has cited illicit stream ripping as a priority issue, specifically calling out youtube-mp3.org. Stream ripping is a considerable and growing threat for the entire music community, with one study estimating a 50% increase in the usage of these sites. This new report rightly shines a much-needed spotlight on this specific type of notorious market, which robs songwriters, artists and labels of the royalties they would have earned from licensed streaming services.” “Today’s report also calls attention to growing concerns regarding the use of reverse proxy services by notorious markets to obscure the location of their hosting provider. These unacceptable tactics employed by many illicit website operators are designed to frustrate detection and enforcement efforts by music creators when their work is being stolen,” Sherman said. “We also note that USTR has appropriately acknowledged progress by markets that have taken positive steps to provide access to legitimate US content,” the RIAA CEO continued. “We thank USTR and other agencies for their hard work on this report and their continued commitment to intellectual property rights protection and enforcement generally.” The American Apparel & Footwear Association hailed the action against Taobao. Rick Helfenbein, president and CEO of the AAFA, said in a statement: “Today’s action shines a renewed spotlight on the considerable concerns we and others continue to see on Alibaba platforms. In the coming year, we will work with our members, USTR and other government agencies, outside stakeholders, and Alibaba itself to seek sustained improvements that lead to the permanent removal of counterfeits from these online platforms.” “USTR’s Special 301 Report identifies physical and online marketplaces that promote the sale of counterfeit merchandise around the world, AAFA said. “In 2015, USTR requested that Alibaba 1) simplify processes for rights holders to register and request enforcement action, 2) make good faith takedown procedures generally available, and 3) reduce timelines for takedowns and issuing penalties for counterfeit sellers. Additionally, USTR referenced Alibaba’s enforcement program’s lack of transparency. “During the month of October, AAFA supplied USTR with detailed comments to explain the prevalence of counterfeits on Alibaba’s platforms, and the impact of these counterfeits on the industry, on workers, and on consumers,” the group added. “In addition to Alibaba platforms, AAFA identified a total of 118 marketplaces in this year’s submission and rebuttal comments. A number of these additional marketplaces have been cited in the USTR report. AAFA also joined with 17 global organizations in a letter to USTR regarding Alibaba.” The International IP Alliance, a consortium of rights holder industries, said in a statement that the 2016 USTR report “includes some markets not previously listed, such as Rarbg.to, a popular torrent website hosted in Bosnia and Herzegovina; and several previously-identified markets, such as Rapidgator.org, a cyberlocker hosted in Russia, that continue their piratical activities unabated. The report also notes certain markets that, because of the notoriety in past listings and follow up enforcement, have closed.” IIPA Counsel Steven J. Metalitz said: “We commend USTR and the inter‐agency for their outstanding work in identifying notorious markets for copyright piracy, including, for the first time, a focus on stream ripping sites, recognized in the report as an emerging trend in digital copyright infringement. The process of identifying specific online and physical markets is a vital tool that can encourage marketplace operators and responsible governments to take action against these blatant infringers, as demonstrated by the fact that some previously-identified markets have been removed from the list. Taking action against markets that are polluted with piracy is a win for both consumers and rights holders, allowing legitimate foreign markets to flourish, thereby enabling greater access to legal content, including literary works, music, movies and TV programming, video games, software, and other products and services.” Share this:Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Facebook (Opens in new window)Click to email this to a friend (Opens in new window)Click to print (Opens in new window) Related William New may be reached at email@example.com."2016 USTR List Of ‘Notorious’ Markets: Stream Ripping, Taobao And Switzerland" by Intellectual Property Watch is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.