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 also needs to protect confidential test data and pharmaceutical products by linking the marketing approval process to the patent registration process.

The United States remains seriously concerned over the continued high rate of production and export of pirated optical disc media, counterfeiting, lack of effective patent and data protection for pharmaceutical products, and lax enforcement. USTR will conduct an out-of-cycle review in the fall to evaluate Malaysia's progress in addressing these concerns.

MEXICO

During the past year, Mexico took significant steps to improve IPR protection. The United States commends Mexico for resolving the "linkage" issue between the Mexican Institute of Industrial Property and the Ministry of Health by implementing in September 2003 a Presidential decree that requires applicants for safety and health registrations to show proof of a patent and proof that test data were obtained in a legitimate manner. In addition, Mexico enacted legislation classifying piracy as an organized crime, and has created a special IPR prosecutor within the Office of the Attorney General (PGR). However, lax enforcement at both the criminal and administrative level, and particularly against copyright piracy and trademark counterfeiting, remains a serious problem. Companies continue to report high rates of counterfeiting of trademarked products. Despite continuing to raise long-standing concerns over these issues, many trademarks owners in Mexico still have problems with enforcement and case administration. When counterfeit items are discovered, injunctive relief measures issued against trademark infringers are often unenforceable.

Copyright piracy remains a major problem in Mexico, with U.S. industry loss estimates growing each year and totaling $712 million in 2003 – the second largest level of losses in the hemisphere. Pirated sound recordings and motion pictures are widely available throughout Mexico, crippling legitimate copyright-related businesses. Strong concerns remain over the amendments to Mexico's copyright law passed by the Congress in July 2003 and still in the process of implementation. These amendments failed to address the comprehensive reforms needed by Mexico to (1) effectively implement the obligations of the WIPO Copyright Treaty and the WIPO Performances and Phonograms Treaty (Mexico is a member of both treaties); and (2) address deficiencies in Mexico's copyright law, such as the failure to provide for national treatment and inadequate provisions regarding the scope of exclusive rights. The United States urges Mexico to take the necessary steps to resolve the current deficiencies.

Enforcement against piracy and counterfeiting in Mexico remains weak, and the few raids by Mexican authorities result in convictions of or deterrent penalties against pirates or counterfeiters. To strengthen enforcement, the United States urges Mexico to expand anti-piracy and anti-counterfeiting efforts against commercial distribution, street piracy and counterfeiting in all major cities; impose strong criminal penalties and destroy seized products, and increase the speed of administrative and judicial actions. In addition, the recently adopted organized crime law should be aggressively used to combat IPR infringements. We hope that previously held bilateral discussions on IPR can be revitalized to provide a constructive and productive forum to address and resolve these IPR concerns in an effective manner.

PERU

There are continuing concerns with respect to Peru's IP regime over the lack of data protection, weakened patent protection, widespread piracy of copyrighted works, and lack of effective IPR enforcement. Both the United States Government and U.S. industry remain concerned with Peru's failure to provide a period of exclusivity for undisclosed test data submitted for marketing approval of pharmaceutical and