China, Russia and 10 other nations were targeted by the US for failing to sufficiently protect US producers of music, movies and other copyrighted material from widespread piracy.
The Bush administration on Monday placed the 12 countries on a "priority watch list" that will subject them to extra scrutiny and could eventually lead to economic sanctions if the administration decides to bring trade cases before the WTO.
Taiwan and another 30 countries were placed on lower level monitoring lists, indicating the concerns about copyright violations in those nations did not warrant the highest level of scrutiny.
"We must defend ideas, inventions and creativity from rip-off artists and thieves," US Trade Representative Susan Schwab said in a statement accompanying the report that highlights problems US companies face around the world with copyright piracy.
The annual Special 301 Report said that China has a special stake in upgrading its protection of intellectual property rights, given that its companies will be threatened by rampant copyright piracy as they move to increase their own innovation.
For Russia, the report said the US will be closely watching to see how the country fulfills the commitments it made to upgrading copyright protection as part of a US-Russia accord reached last year, which was seen as a key milestone in Russia's efforts to join the WTO.
In addition to Russia and China, the 10 countries placed on the priority watch list were Argentina, Chile, Egypt, India, Israel, Lebanon, Thailand, Turkey, Ukraine and Venezuela.
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