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 SECTION I. DEVELOPMENTS IN INTELLECTUAL PROPERTY RIGHTS PROTECTION AND ENFORCEMENT

An important part of the mission of the Office of the United States Trade Representative (USTR) is to support and implement the Administration's commitment to aggressively protect American intellectual property (IP) overseas. Infringement of intellectual property rights (IPR) causes significant financial losses for rights holders and legitimate businesses around the world. It undermines key U.S. comparative advantages in innovation and creativity, to the detriment of American businesses and workers. In its most pernicious forms, IPR infringement endangers the public. Some counterfeit products, such as semiconductors, automobile parts, and medicines, pose significant risks to consumer health and safety. In addition, trade in counterfeit and pirated products often fuels cross-border organized criminal networks and hinders the sustainable economic development of many countries.

Because fostering innovation and creativity is essential to U.S. prosperity, competitiveness, and the support of an estimated 40 million U.S. jobs that directly or indirectly rely on IPR-intensive industries, USTR works to protect American inventiveness and creativity with all the tools of U.S. trade policy, including this Report.

Positive Developments

The United States welcomes the following important steps by our trading partners in 2012 and early 2013:

 Bahamas – The United States welcomes recent action by the Copyright Royalty Tribunal to pay royalties due to U.S. rights holders. These royalties had been collected under a now repealed provision of the 1998 Bahamian Copyright Law which until 2009 allowed the government-owned Cable Bahamas to retransmit and sell pay television programming of U.S. rights holders without their authorization. The United States notes, however, that royalties have yet to be paid to representatives of songwriters for the public performance of their works under this regime. The United States looks forward to such action in the near term.

Brunei Darussalam – Brunei has been removed from the Watch List in 2013. Brunei has significantly increased its focus on IPR protection and enforcement in recent years, through substantial and meaningful enforcement efforts, including both civil and – for the first time – criminal actions. Brunei recently created its first patent office and enacted patent law amendments that significantly strengthen its patent regime. Brunei has also announced recently that it is taking steps to join the WIPO Internet Treaties. While concerns remain in some areas, including with respect to Brunei's implementation of data protection regulations and IPR border enforcement, particularly against transshipments, the United States is removing Brunei from the Watch List in recognition of the significant IPR legal reforms and commitments referenced above. The United States will continue   9