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 During the past year, Taiwan passed a number of new laws meant to strengthen the protection of intellectual property rights and bring the economy into compliance with its obligations under the TRIPS Agreement. These include certain amendments to its patent and copyright laws as well as new legislation to license the production of optical media, although the U.S. Government was disappointed that the optical media legislation was weakened before passage. Despite these positive steps, the lax protection of IPR in Taiwan remains very serious. U.S. companies report significant problems in being able to protect and enforce their intellectual property rights. Taiwan is one of the largest sources of pirated optical media products in the world. Its copyright law needs strengthening in a number of areas to deal with growing piracy. Corporate end-user piracy remains at a high level. Taiwan also suffers from trademark counterfeiting, including that of pharmaceuticals. Taiwan has only begun to take the steps necessary to enforce these new laws, particularly the optical media management statute. Nonetheless, the United States remains encouraged by the passage of these laws and the important first steps that have been taken in terms of implementation. The United States will continue our dialogue with Taiwan on the protection and enforcement of intellectual property rights during the coming year to help improve the situation.

URUGUAY

Uruguay's efforts to reform its outdated copyright and patent laws have been dominated by slow and uneven progress, which has resulted in an intellectual property rights regime that does not appear to be in compliance with Uruguay's TRIPS obligations. Specifically, Uruguay needs to update its 1937 copyright law to clarify that software is protected as a literary work, among other deficiencies. Movement towards a comprehensive copyright law stalled in 2001, and the U.S. Government is concerned about a flawed, software-only bill, which is moving forward. The United States is heartened by the increase in raids and prosecutions against piracy since 2000. However, inadequate civil remedies and lax border enforcement have caused high piracy rates to persist, and have allowed Uruguay to become a major transshipment point for pirated products. The United States urges Uruguay to ratify the WIPO Internet Treaties, enact TRIPS and WIPO-compliant copyright legislation, and remedy provisions of its patent law that appear to violate its TRIPS obligations.

ARMENIA

Armenia has several remaining steps to take to fulfill its intellectual property rights commitments under the 1992 U.S.-Armenia Trade Agreement. In addition, the Armenian intellectual property regime does not appear to be TRIPS-consistent in its current form, so certain changes may have to be made in preparation for Armenia's accession to the WTO. At present, Armenia does not provide any protection or rights to U.S. and other foreign sound recordings or clearly provide retroactive protection for works or sound recordings under its Copyright Law. In addition, there is weak enforcement of