Trapped in China's Shadow? Intellectual Property Protection in Post-WTO-Accession Russia

Abstract: Russia's December 2011 accession to the World Trade Organization means that it has agreed to implement and enforce intellectual property (IP) laws in accordance with the Agreement on Trade-Related Aspects of Intellectual Property. This gives some hope that foreign enterprises, frequently victims of IP infringement in Russia, will receive protection. Yet the parallel experience of China, which acceded in 2001, tempers that enthusiasm because the WTO has been ineffective in stopping infringement there. This Note compares China's and Russia's historical attitudes toward IP rights, economic incentives to adopt Western standards, and institutional challenges to assess the extent to which the WTO's performance in China can predict its efficacy in curtailing counterfeiting and piracy in Russia.IntroductionOn December 16, 2011, the Ministerial Conference of the World Trade Organization (WTO) voted to allow Russia entry into the Or- ganization as a full member.1 Russia's accession presents a momentous contribution to the WTO's goal of creating a unified system of liberal- ized trade: as the last global economic power to join the organization, Russia will bring an estimated ninety-seven percent of international trade under the WTO's regime.2 The vote is most significant, however, to Russia itself, closing its nearly twenty-year accession campaign.3 For Russia, WTO membership represents both symbolic international po- litical acceptance and the more tangible benefit of increased global economic integration.4Developed countries and their business interests also expect to benefit from Russia's WTO membership through improved investment conditions.5 Nevertheless, such enthusiasm is tempered by Russia's poor record regarding intellectual property (IP) protection.6 Weak IP enforcement enables Russian firms to copy patented technology and copyrighted material at great cost to rightholders in developed econo- mies such as the United States and European Union (EU) ? Such fears are particularly great following China's failure to uphold similar rights after its 2001 WTO accession.8 As a result, negotiations leading up to Russia's accession vote focused on committing Russia to measures pro- tecting IP rights.9 Yet the question remains: when Russia's pledges are put into practice, will they be upheld?10Part I of this Note addresses the historical and economic backdrop against which the likelihood of improved Russian IP enforcement must be assessed. It focuses on Russia's accession campaign and the role that its poor IP enforcement played in framing negotiations. Part II dis- cusses the state of existing Russian IP protections, as well as changes proposed during bilateral pre-accession negotiations with developed countries. It lays out a framework for assessing Russia's potential com- pliance by comparison with China, which shares several common traits as a large country transitioning into a market economy. Part III ana- lyzes whether Russia can live up to its commitments under the WTO's Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) and bilateral agreements, despite facing the challenges of economic development. Part III will further explore if and how tech- nology-exporting nations can ensure that Russia fully respects their companies' IP rights through the WTO.I. BackgroundA. Russia: From GATT Skeptic to WTO ApplicantFollowing the turmoil of the Second World War, twenty-four states convened in 1947 to sign the General Agreement on Tariffs and Trade (GATT).11 They sought mutually-beneficial reductions in trade barriers for the purpose of "raising standards of living . . . and expanding the production and exchange of goods."12 Although many of the world's largest political and economic powers, including the United States, the United Kingdom, and France, signed the treaty, the Soviet Union (USSR) refused out of fear that opening its economy to international interference would threaten its commitment to a communist non- market economy. …