China and Russia top list of worst copyright violators

China and Russia are the two worst foreign infringers of U.S. software and music copyrights and they should remain on the U.S. government's priority watch list, a group representing the software, music, books, and movie industries said Monday.

The International Intellectual Property Alliance (IIPA) put out the figures as part of its recommendations to the U.S. Trade Representative. It asked government officials to keep both countries on its Priority Watch List when it meets to discuss the annual Special 301 review of copyright piracy. The list is compiled each year, and nations placed on the list are watched closely for signs of improvement. Failure to take action can result in countries losing certain duty-free trade privileges.

The IIPA said the worst 60 foreign music and software pirating nations cost industry members $15.25 billion last year, compared to $15.83 billion in year earlier. The figure could be as much as $35 billion if the U.S. and the rest of the world are included, IIPA estimated. The figures are based on statistics supplied by member associations.

China topped all rivals on the IIPA most-wanted list by pumping out $2.21 billion worth of pirated goods last year, mainly business software, according to IIPA figures. Russia ran a close second at $2.18 billion, it said. China's 2006 figure marks a slight improvement over the previous year, when the IIPA estimated its piracy at $2.37 billion, but Russia took a sharp turn for the worse. In 2005, Russian copyright piracy only cost IIAP members $1.76 billion, the group said.

Music, software and movie trade groups view the Special 301 process as the best means available for them to encourage greater copyright protection globally, IIAP said.

The group recommended that 16 countries, including Canada, China, Mexico, and Russia, be placed on the Priority Watch List, putting them up for the highest degree of scrutiny. Canada and Mexico, the U.S.'s border neighbors, are two of its biggest trading partners.

Italy escaped an IIPA recommendation for the priority list despite hosting the third worst copyright infringement problem, by value, on the group's list. Italy pirated $1.43 billion worth of U.S. software and songs last year, down slightly from $1.62 billion the year before, according to the IIPA. The group said its decision to recommend a country for the top list is based on the total amount and on efforts to improve.

IIPA recommended that Italy be placed on the Special 301 Watch List, along with 27 other countries or territories.

The IIPA is comprised of seven business associations, including the Business Software Alliance (BSA), Motion Picture Association of America (MPAA) and Recording Industry Association of America (RIAA). In all, the associations represent over 1,900 U.S. companies.