Saudi Arabia: 2018 Special 301 Report's "Watch-List": An Analysis Of The Inclusion Of Saudi Arabia And The UAE

Last Updated: 26 June 2018
Article by Manel Ben Said

Special 301 Report (the "Report") is a United States congressional mandated document that reflects the U.S. Administration's views on the protection and enforcement of U.S. intellectual property (IP) rights globally. The Report is compiled by the U.S. Trade Representative (USTR) and is published annually. It purports to "call out foreign countries and expose the laws, policies, and practices that fail to provide adequate and effective IP protection and enforcement for U.S. inventors, creators, brands, manufacturers, and service providers".

The 2018 Report lists thirty-seven states under two separate categories – a "Priority Watch List" and a "Watch List". The Priority Watch List i.e. classifies those states, which have major shortcomings and drawbacks on IP protection and therefore require further attention, cautioning and improvement of their IP enforcement and laws. The Priority Watch List, in the 2018 Report currently hosts twelve states. In contrast, the Watch List classifies those countries, which are facing certain deficiencies in the enforcement of IP rights as identified in the Report. The Watch List in the 2018 Report currently hosts 25 states, including Saudi Arabia and the UAE – for the first time. Kuwait is a long-serving veteran of the Priority Watch List, while Egypt is similarly a well-seasoned attendee of the Watch List.

What the Report says

The Report covers a wide range of issues, which, in the view of the USTR, must be addressed to ensure that U.S. persons and entities, who rely on IP protection, gain "fair and equitable market access" in the countries in question.

Saudi Arabia

Some of the issues raised by the Report include:

  • the lack of enforcement against the use of unlicensed software;
  • deterioration in protection for pharmaceutical products;
  • concerns regarding IP enforcement are increasing, including concerns related to difficulty in obtaining information on the status of enforcement actions and investigations; and
  • lack of seizure and destruction of counterfeit goods.

Primarily, the Report includes Saudi Arabia due to an alleged deterioration in IP protection for pharmaceutical products. The Report details that in recent years, Saudi Arabia has granted marketing approvals for domestic companies to produce generic versions of pharmaceutical products, which are under patent protection either in Saudi Arabia or in the GCC. Allegedly, these market approvals were granted, despite innovators' data being protected under Saudi Arabia's laws against unfair commercial use. The Report suggests that these approvals, conflict with Saudi Arabia's domestic laws and raise significant questions about the transparency of marketing approvals and predictability of patent protection in Saudi Arabia. A further concern raised in the Report was the alleged continued use of licensed software by the Saudi government.

United Arab Emirates

For the UAE, the Report's main points for concern include:

  • recent policy changes that may weaken IP protection for pharmaceutical products;
  • lack of a mechanism to allow copyright licensing and royalty payments; and
  • high trademark filing fees that are cost-prohibitive.

The Report recognises that some UAE enforcement authorities (i.e. Dubai) seize and destroy counterfeit goods, however it highlights that significant copyright piracy and trademark infringement concerns remain.

Much like in the case of Saudi Arabia, the Report calls out the UAE for allowing the domestic manufacture of generic versions of pharmaceutical products, which are still under patent protection in the U.S. In this regard, the U.S. relies on the Decree 404 system that recognises the country of origin patent protection for pharmaceutical products. The Report alleges that the UAE no longer views the measures adopted through this decree as valid.

Other concerns raised with regards to the UAE include the lack of IP infringement prosecutions; a lack of permanent staff solely dedicated to counterfeit enforcement; a lack of enforcement action without specific, written complaints from the right holders; and a lack of transparency and available information related to raids and seizures of pirated and counterfeit goods. Moreover, the report notes that despite the existence of implementing regulations, the UAE has yet to grant the necessary operating licenses to establish Collective Management Organisations (CMOs) to allow copyright licensing and royalty payments. Finally, the report raises concerns over the high trademark filing fees in the UAE, which are the highest in the world and considered cost-prohibitive to protecting trademarks in the UAE.

The Missing Narrative

The Electronic Frontier Foundation (EFF), an international non-profit digital rights group based in San Francisco, claims that the Report is the result of an opaque process that directly manifests the desires of private industry behemoths, like Hollywood and the pharmaceutical industry. EFF view the Report as a bullying tactic used by the U.S. administration to push countries into adopting stronger IP laws, regardless of whether such laws are in the best interest of the citizens of that country.

The EFF noted that the Report does not differentiate between IP policies that suit highly industrialised nations from those that suit lesser-developed states. Indeed, the appropriate levels of IP protection vary depending on a country's level of development – less industrialised states can experience exacerbated harms from restrictive IP laws, especially when they impede innovation, creativity, access to knowledge and industrial growth.

Even highly industrialised countries like Canada, who are year-on-year included on the Report's Priority Watch-List for allegedly not addressing issues in relation to piracy over the internet, are now tired of the annual shaming of the Report. Indeed in 2017 Canada issued a rebuttal in which it considered "the Special 301 process and the Report to be invalid and analytically flawed because the process relies primarily on U.S. industry allegations rather than empirical evidence and objective analysis".

As a general comment, Saudi Arabia (84 years old) and the UAE (47 years old), are new states in comparison with the U.S (242 years old). Considering the short time spans of both countries' legal regimes, IP protection has developed at a much more rapid rate in those jurisdictions, in comparison to that of the U.S' legal regime. Moreover, as a highly industrialised nation and a net exporter of IP, the U.S. evidently has different interests and agendas that may not always compliment those of the UAE and Saudi Arabia. As importers of IP, Saudi Arabia and the UAE understandably are entitled to pursue varying forms of IP policies, which do not necessarily have to follow suit with those of the U.S. This does not negate, however, from Saudi Arabia and the UAE's ongoing pursuit of better IP protection regimes. Both countries recognise that there is always room for improvement and are progressing in terms of their IP policies.

Indeed, the EFF's Special 404 Report that was compiled in response to the Report, urges governments around the world to be sceptical when considering the recommendations of the Report. The EFF Report recommends to those governments that they prioritise access to culture, economic stimulation and fairness when adopting and enforcing IP laws. That is not to say, however, that one should disregard or dismiss the recommendations in the Report, but rather that fairness and economic stimulation should be taken into considerationwhen implementing IP laws. Below we analyse the Report's claims in connection with Saudi Arabia and the UAE.

Conclusion: Analysis of the Report's findings

Both Saudi Arabia and the UAE can improve their enforcement initiatives against trademark counterfeiting and are taking steps to do so. In Saudi Arabia, trademark enforcement and raid actions are under the jurisdiction of the Anti-Commercial Fraud Department (ACFD) at the Ministry of Commerce and Industry and the officials there have gone to great measures to improve their enforcement practices. However, due to certain structural and organisation changes, the ACFD is now taking longer periods to study complaints and organise raids. The ACFD has also on some occasions rejected 3D trademark infringement complaints arguing that the trademark in question is, in their view, an industrial model. On such occasions, the ACFD referred the matter to a committee, leading to delay before action was taken.

In the UAE, each Emirate has its own Department of Economic Development (DED) with which a brand owner, or their representative, must submit administrative trademark infringement complaints for raid actions to take place. Each Emirate is at a different level of development in terms of the services offered at their DED. The Dubai DED will accept the submission of complaints and payment of the associated fees online, and inspectors are quick to review complaints. The entire process from filing the complaint to conducting a raid action (if the complaint is accepted) does not usually exceed two business days. The Dubai DED has had huge success in 2017, confiscating 26,199,467 pieces of counterfeit goods with an estimated value of AED 1.2 bn. In that respect, Dubai is leading other Emirates in terms of brand enforcement actions. For example, in Ajman, the DED only accepts complaints and payment physically, and this process can be time consuming. Other problems of organisation and lack of training on brand awareness exist in many DED departments within the UAE. Addressing such problems is of outmost importance in order for UAE IP protection to improve.

While the Report is somewhat one-sided and politicised it would be remiss for the UAE and Saudi Arabia not to take heed of some the Report's concerns. However, the approach to IP policy making should stem from principles of fairness and equity while supplementing competing interests of economic growth and access to knowledge. In that respect, the Report falls short of applying those principles and considering such interests.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions