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 authority, including providing for more effective provisional relief.

China's courts have issued some significant decisions on enforcement of copyright, in particular rights in works transmitted over the internet. That said, the underlying problem of obtaining effective enforcement remains. We will be monitoring China's actions to address these problems to ensure that the laws as enacted are consistent with China's WTO obligations and that China applies its laws to provide more effective protection of intellectual property rights. We will continue our active program of bilateral consultations and work through the WTO and WIPO as well.

 Both internally and at its borders, Paraguay denies adequate and effective protection for copyrights, and trademarks and patents. Paraguay was identified as a Priority Foreign Country in January 1998. The subsequent Section 301 investigation terminated with the signing of a comprehensive Memorandum of Understanding (MOU) on the protection of intellectual property. Unfortunately, the implementation of the MOU has been inadequate, and Paraguay continues to be a regional center for piracy and counterfeiting and a transshipment point to the larger markets bordering Paraguay, particularly Brazil, where the sales of pirated copyright products in optical media and other formats have been of particular concern. Notable examples of Paraguay's mixed record on honoring its MOU commitments include the passage ofa new copyright law that addressed most of the U.S. concerns, but nevertheless designates copyright piracy as a private rather than a public action, thus requiring legal action by the offended party to seek redress. A subsequent law remedied the situation by appointing three specialized intellectual property prosecutors in Paraguay with the ability to pursue copyright infringement cases as "public" actions, but subsequently the government ordered the prosecutors to devote their time to other cases. Also, despite issuing a decree on December 31, 1998, requiring government use oflegitimate software, in compliance with the MOU, the government nevertheless missed the decree's deadline to legalize software and also failed to inventory installed software. To date, the U.S. Government has had no indication that the Government of Paraguay provides TRIPS-consistent protection for industrial designs, the layout-designs of integrated circuits, or undisclosed information (trade secrets and test data). The United States is concerned with these lapses in the implementation of the MOU and will seek consultations with Paraguay in the near future to review these concerns. If no progress is made on these issues in the coming year, the U.S. Government may have no choice but to reactivate the Section 301 investigation.

 Argentina has fulfilled some, but not all, of its long-standing commitments to the United States on intellectual property. Most notably, in October 2000, Argentina began issuing pharmaceutical patents. However, other parts of its patent, as well as its copyright, and trade secrets regimes are still not up to international standards. Its lax enforcement against piracy, counterfeiting and unauthorized use of protected seed varieties remains a problem. Argentina's lack of patent protection for pharmaceutical products has been a very contentious bilateral issue since 1987,