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 production capacity expanded alarmingly during the past year, from fewer than a dozen illicit production lines a year ago to at least 70 today. This capacity is far in excess of Indonesia's domestic demand. It is becoming increasingly apparent that, as other countries in the region intensify their fight against copyright infringement, audio and video pirates are finding refuge in Indonesia. Trademark infringement is a growing problem, with famous U.S. trademarks appearing on products ranging from televisions to blue jeans, which is detrimental to U.S. mark owners. The Indonesian judicial system remains an ineffective mechanism for enforcing intellectual property rights. The United States presented the Indonesian Government in January 2001 with an action plan for intellectual property protection on which we expect to work with Government of Indonesia in the coming months.

 While the United States is gratified by reports that illicit commercial-scale production of optical media in Israel may have fallen substantially, Israel's domestic market for copyright goods remains dominated by pirated music, video and software CDs. Further, Israel is part of an enormous transshipment network for pirated versions of Russian-language software, as well as audio and video CDs and cassettes. While enforcement of copyright has improved in the public sector, enforcement against piracy in the private sector needs to be strengthened further. Israel has demonstrated that it is serious about addressing piracy and has translated this commitment into action by increasing its special police intellectual property rights enforcement units, but these units remain too small and underfunded to be effective. Even when they do act, convictions are rare and do not result in deterrent penalties. Patent protection in Israel is inadequate. In May 2000, the Minister of Health approved regulations permitting the parallel import of pharmaceuticals protected by patents. Further, Israel allows generic pharmaceutical manufacturers to obtain marketing approval based on confidential test data submitted by innovator pharmaceutical firms. Israel's failure to protect this data, generated at great expense by the innovators, appears to be a violation of its obligations under Article 39.3 of TRIPS. We have continuing consultations with the Israeli Government on intellectual property issues, and we hope these will soon bear fruit. If there is no progress in the data protection area, the United States will need to consider other options for encouraging Israel to remedy this situation.

 In February, Korean President Kim announced a stepped-up copyright enforcement program, with special enforcement periods set for March-April and September-October, including investigations of government agencies, universities, and corporations for unauthorized use of copyrighted software. The Korean Government also announced that it will establish a standing organization to enforce intellectual property rights, particularly copyright piracy, on an on-going basis. The United States welcomes these positive developments. Unfortunately, it is too soon to judge their effectiveness. The first special enforcement period is still underway and questions remain about whether the enforcement program is transparent and non-discriminatory, as well as whether the stepped-up enforcement effort will be sustained. We also look to the Government of Korea to effectively address the widespread piracy of U.S. trade and educational books.

In January 2001, the Korean Government enacted amendments to strengthen its patent and trademark laws. While this is encouraging, there remain a number of weaknesses in Korea's