Section 337 and GATT and the Akzo Controversy: A Pre- and Post-Omnibus Trade and Competitiveness Act Analysis

The burgeoning of new technology such as semiconductor chips, computer software, genetic engineering, pharmaceuticals and other chemical processes raises important international trade issues for the protection of intellectual property rights. Inadequate protection has left the door open for pirating and counterfeiting. Section 337 of the United States Tariff Act of 1930 ("Section 337") protects intellectual property rights from international pirating and counterfeiting. It provides a mechanism for excluding fringing imports from the United States marketplace.

In Re United States Litigation between E.I. Dupont de Nemours & Co. and Akzo N.V., the EC Commission determined that the procedure followed under Section 337 contradicts Article III of GATT and is an illicit commercial practice by the United States Government. Contrary to the EC Commission's determination, Section 337 does not conflict with the United States obligations under Article III of GATT. Nor do the substantive amendments to Section 337 by the Omnibus Trade Act create a conflict with Article III of GATT.