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Title: Analysis of Enforcement Mechanism of Section 337 of the US Tariff Act through Perspectives in Law and Economics
Authors: Yu, Yang
Zhang, Lei
Keywords: Section 337;Patent infringement;Trade remedy;Law and Economics
Issue Date: May-2012
Publisher: NISCAIR-CSIR, India
Abstract: The analyses made in this article aim at providing distinct explanations and making some predictions on the enforcement mechanism of Section 337 of the Tariff Act of 1930 of the United States from three specific perspectives in the domain of law and economics. Firstly, from the perspective of cost-benefit analysis, it is apparent that the utilization of this enforcement mechanism is the more rational choice for patent holders and exclusive licensees to prohibit and prevent patent infringement in import trade compared with patent litigation in federal district courts. Secondly, from the perspective of negative externalities, it could be ascertained that negative externalities would possibly be incurred by the issuance and enforcement of the general exclusion order issued by the US International Trade Commission (ITC). Whether evaluated by Pareto-efficient or by Kaldor-Hicks-efficient standards, economic inefficiency would potentially be incurred by the issuance and enforcement of general exclusion order especially from the global perspective. Some other institutional measures should be designed and implemented to assure that the possible negative externalities and economic inefficiency caused by general exclusion order should be regulated and restrained to the greatest extent. Finally, from the perspective of path dependence, it can be concluded that the legal institution of Section 337 has been locked-in after the history of 90 years’ development. Consequently, even if there would be another dispute against Section 337 adjudicated by the Dispute Settlement Body of the WTO in the future, Section 337 would not be totally abolished or substantially derogated.
Page(s): 209-217
ISSN: 0975-1076 (Online); 0971-7544 (Print)
Appears in Collections:JIPR Vol.17(3) [May 2012]

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