USTR Designates Vietnam as Priority Foreign Country for Intellectual Property Violations, First in 13 Years

The Office of the United States Trade Representative (USTR) announced on April 30 that it has designated Vietnam as a Priority Foreign Country (PFC) for intellectual property (IP) rights violations. This marks the first time in 13 years that any country has been placed in this highest concern category, reserved for nations with the most egregious IP-related acts, policies, and practices that adversely impact US products.

According to the USTR, the PFC designation is applied to countries that have not engaged in good faith negotiations or made significant progress toward providing adequate and effective IP rights protection. Vietnam's inclusion signals serious concerns over its IP enforcement regime and the potential harm to American businesses and innovation.

The USTR stated it will decide within 30 days whether to initiate a formal investigation under Section 301 of the Trade Act of 1974. Should an investigation commence, the USTR plans to request consultations with Vietnamese authorities to address and resolve the issues that led to the PFC designation.

This development comes amid a broader global context of IP enforcement, with the USTR also updating its priority watch list and watch list categories. Notably, Argentina and Mexico were removed from the priority watch list due to demonstrated improvements in their IP protections. Mexico welcomed its removal, which coincides with preparations for a trilateral review of the United States-Mexico-Canada Agreement (USMCA) scheduled for 2026.

Countries remaining on the priority watch list include China, India, Chile, Indonesia, Russia, and Venezuela. The watch list, a tier below the priority watch list, now includes 19 trading partners, with the European Union newly added in the latest report.

The USTR's annual Special 301 Report serves as a key tool in identifying and addressing global IP challenges. The elevation of Vietnam to Priority Foreign Country status underscores the US government's heightened focus on combating IP infringement and protecting American intellectual property rights in critical markets.

Vietnam's designation could lead to increased trade tensions and potential retaliatory measures if negotiations fail to yield satisfactory improvements. The USTR's forthcoming decision on initiating a Section 301 investigation will be closely watched by stakeholders in the international trade and IP law communities.

This report reflects the US administration's ongoing commitment to enforcing IP rights globally and ensuring fair trade practices that support innovation and economic growth.