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 markets, including in large markets such as the Gorbushka market and the Rubin Trade Center in Moscow. Despite these improvements, the United States is concerned that hard goods counterfeiting and piracy continue to be widespread, particularly for the motion picture, television and entertainment software industries.

Another important step Russia took was to close down operations of all optical disc plants engaging in production of pirated media located on Russian state-owned restricted access regime enterprises (RARE) sites, pursuant to the 2006 Bilateral Agreement on IPR. According to industry reports, however, warehouses storing pirated CDs and DVDs remain on several government-controlled military-industrial sites. This leaves Russian enforcement agencies and rights holders with limited opportunities to conduct successful raids against such warehouses.

The United States recommends that Russia take steps to address these and other IPR concerns. The United States is concerned that, with respect to piracy over the Internet, significant gaps exist in Russian law and enforcement efforts. This creates obstacles to Russia's ability to keep pace with changing technology. To deal with websites hosting illegal material, the United States encourages Russia to pass notice and take down legislation that addresses all forms of piracy over the Internet and provides for the swift removal of infringing content. In addition, numerous pay-per-download websites as well as cyberlockers, BitTorrent sites, and unauthorized music services, including services affiliated with social networking sites such as vKontakte, reside in Russia. The United States urges Russia to engage in vigorous, sustained, and measureable takedown and enforcement actions, including criminal enforcement actions with deterrent penalties, against existing as well as future infringing sites. Furthermore, intensified criminal investigations and criminal convictions against operators of illegal Internet sites are needed. The United States also urges Russia to assign specially trained personnel and other appropriate resources to a specialized law enforcement unit within Department K of the Ministry of Internal Affairs (MVD) in order to prioritize and improve its enforcement efforts with respect to piracy over the Internet. This unit should work closely with rights holders' representatives to target and to take action against priority infringing websites.

The United States therefore urges Russia to strengthen its overall enforcement efforts, including criminal enforcement efforts, against piracy and counterfeiting. Enforcement continues to vary greatly among regions. According to MVD, the number of raids, and the extent of cooperation with rights holders, decreased in 2010. While Russian police continue to carry out end-user raids against businesses using pirated products, there are indications that such raids are sometimes done on a selective basis. Even where raids are conducted in a sustained and vigorous manner, prosecutions and convictions do not necessarily follow. The United States urges Russia's enforcement officials to increase the number of IPR-related investigations, and prosecutors to seek deterrent penalties in judicial proceedings. The United States encourages Russia to pass legislation establishing a specialized IPR court. The United States looks forward to working together with Russia on continuing education opportunities for judges with respect to IPR.

Concerns have also been raised about Russia's accreditation process for collecting societies. Additionally, recent litigation with respect to the single collecting society accredited to collect royalties on behalf of all performers and record companies (i.e., the All-Russia Organization for Intellectual Property (VOIS)) has introduced uncertainty regarding VOIS's status and the status of the accreditation process generally. The United States looks forward to working with Russia on these and other issues.