United States' Unfair Competition Acts and Software Piracy – Which Asia-Pacific Countries Are at Risk and Recourse Do They Have?

Despite widespread fears, traditional forms of protectionism – such as import tariffs - have not substantially increased since the onset of the 2008 economic crisis. However, as a response to domestic economic pressures, countries like the United States have resorted to less-transparent potentially discriminatory trade policies, of which the Unfair Competition Acts issued in Washington State and several other states are recent examples. These acts allow the United States government and private entities operating where these acts apply to take action against foreign competing producers who are found to use illegal IT software in their production processes. The passing of these acts augment the existing federal legislation by making allowing focused legal action on the basis of misappropriation of software.Non-compliance with these acts can lead to severe sanctions such as import bans, which may have devastating effects not only for the exporter but also for the laborers and other stakeholders involved. Countries can assess their potential exposure to the acts by using seemingly simple indicators such as piracy rates and the share of their exports of manufactured goods to the United States in the overall such exports. Using these metrics, it appears that exports from countries such as China, India, Indonesia, Thailand, Sri Lanka, and Viet Nam, are relatively exposed to adverse effects from the legislation. Countries with piracy rates below the regional average such as Japan and the Republic of Korea also face risks largely influenced by the fact that they export goods which to which the United States reacts more sensitively to including automotives, aviation, food and agriculture, and beverages