Generally, individual countries grant and enforce IP rights. Intellectual property is any innovation, commercial or artistic, or any unique name, symbol, logo, or design used commercially. Intellectual property rights protect the interests of the creators of these works by giving them property rights over their creations. Patent: Exclusive rights granted to inventions for a fixed period of time, whether products or processes, in all fields of technology, provided they are new, not obvious (involve an inventive step), and have utility (are capable of industrial application). Copyright: A set of exclusive rights subsisting in original works of authorship fixed in any tangible medium of expression now known or later developed, for a fixed period of time. For example, works may be literary, musical, or artistic. Trademark: Any sign or any combination of signs capable of distinguishing the source of goods or services is capable of constituting a trademark. Such signs, in particular, words including personal names, letters, numerals, figurative elements and combinations of colors as well as any combination of such signs are eligible for registration as trademarks. Trade secret: Any type of valuable information, including a formula, pattern, compilation, program device, method, technique, or process that gains commercial value from not being generally known or readily obtainable; and for which the owner has made reasonable efforts to keep secret. Geographical indication: Indications that identify a good as originating in a country, region, or locality, where a given quality, reputation, or other characteristic of the good is essentially attributable to its geographic origin. “Pirated copyright goods” means any goods that are copies made without the consent of the right holder or person duly authorized by the right holder. “Counterfeit goods” means any goods, including packaging, bearing, without authorization, a trademark that is identical to a trademark validly registered for those goods, or that cannot be distinguished in its essential aspects from such a trademark, and that thereby infringes the rights of the owner of the trademark in question. While determining the exact magnitude of the problem is difficult, industry groups suggest that counterfeiting and piracy are on the rise and that an increasingly broad range of products, from auto parts to razor blades, and from vital medicines to infant formula, are subject to counterfeit production. High profits and low risk have drawn in organized criminal networks and technology has facilitated the manufacture and distribution of counterfeit and pirated products, resulting in a global illicit market that competes with genuine products. Although the public is often not aware of the issues and consequences surrounding IP theft, many counterfeit products raise serious public health and safety concerns, and the annual losses that companies face from IP violations are substantial. Legal protection of IP varies greatly around the world, and several countries, including China, India, and Thailand are havens for the production and sale of counterfeit and pirated goods. Under its annual Special 301 process, the United States has designated China, India, and Thailand as Priority Watch List countries, meaning that they are not providing an adequate level of IP protection or enforcement, or market access for persons relying on IP protection. Priority Watch List countries are the focus of increased bilateral attention regarding IP issues. China, India, and Thailand are also members of the World Trade Organization (WTO) and must comply with the WTO’s Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), which provides minimum standards for IP protection and enforcement. Seven federal agencies, and entities within them, undertake the primary U.S. government activities in support of IP rights overseas. These agencies are: Commerce, State, DOJ, DHS, HHS, USTR, and the U.S. Agency for International Development (USAID). Key entities include Customs and Border Protection (CBP), the Food and Drug Administration (FDA), Immigration and Customs Enforcement (ICE), the Federal Bureau of Investigation (FBI), the International Trade Administration (ITA) and USPTO. USPTO and DOJ recently established positions overseas that have IP protection and enforcement as their primary mission, in order to enhance U.S. efforts. USPTO created its IP attaché program to address country- specific and regional IP problems in key parts of the world. USPTO’s first IP attaché was posted in Beijing, China, in 2004. USPTO added an attaché in Beijing, China, in 2006; and an attaché in Guangzhou, China, in 2007. During 2006 and 2007, USPTO also expanded the program to five other countries: Egypt, Thailand, Russia, Brazil, and India. Since then, the Egypt position has been eliminated and a new position in Doha, Qatar, is in the planning stages. Table 1 shows the current IP attaché positions, their country and post locations, and their geographic areas of coverage. The IP attachés work on a range of IP activities in coordination with other federal agencies, U.S. industry, and foreign counterparts. At the time of our audit work overseas in March 2009, both IP attaché positions in Beijing were vacant, with the two IP attachés departing in August and November of 2008, respectively. According to USPTO, the IP attaché in Guangzhou helped manage the office in Beijing in the absence of an IP attaché there; and from December 2008 through August 2009, on a regular basis, USPTO headquarters sent attorneys with expertise and experience on China IP matters from the Office of IP Policy and Enforcement to Beijing on short-term assignments to manage the office. In March 2009, USPTO officials told us that a candidate had been selected to fill one of the vacant attaché positions. The new attaché arrived in early September 2009. USPTO stated that it intends to fill the other vacancy in Beijing and will be putting out a vacancy announcement in the near future. DOJ placed two federal prosecutors with IP expertise to serve as IPLECs, in Bangkok, Thailand, and Sofia, Bulgaria, in January 2006 and November 2007, respectively. The IPLECs are tasked with advancing the criminal enforcement of laws in their respective regions through a combination of training, technical assistance, and outreach. The IPLEC in Thailand also serves as a DOJ attaché and thus, according to DOJ officials, performs case work, including investigations on IP. Although IP is a central part of the mission of the IPLEC in Thailand, as DOJ attaché, this person is also responsible for a range of DOJ functions beyond IP. In addition to the IP attachés and the IPLECs, there are a variety of other types of U.S. government personnel posted overseas who perform IP functions. For instance, State economic, political, and public affairs officers may be involved in IP activities at posts. ICE and CBP attachés may also be involved. Other personnel such as FBI legal attachés, Commerce’s Foreign Commercial Service (FCS) officers, FDA investigators and technical experts, and USDA Foreign Agricultural Service officers are among the other U.S. government personnel that may be involved in IP activities at posts. As described in our February 2009 report, the various U.S. personnel posted overseas conduct a range of activities related to IP enforcement and protection within their agencies’ respective roles and responsibilities. These responsibilities generally include advancing U.S. IP policy, dialoguing with foreign counterparts on IP, providing training and technical assistance, supporting U.S. companies, facilitating enforcement of IP laws and regulations, and conducting public awareness campaigns. Table 2 elaborates on these responsibilities and the types of activities they entail, and provides examples of how such activities are undertaken by U.S. personnel in China, India, and Thailand. The U.S. government has identified weak enforcement as a key IP issue in the three case study countries; however, weaknesses also persist in their IP laws and regulations. According to the U.S. government, enforcement of existing IP laws and regulations and adjudication of suspected infringements are limited and inconsistent and penalties are not typically sufficient to serve as an effective deterrent. U.S. government documents and U.S. officials we interviewed cited several factors that contribute to this limited and inconsistent enforcement including flawed enforcement procedures; a lack of technical skills and knowledge of IP among police, prosecutors, and judges; a lack of resources dedicated to IP enforcement efforts; and the absence of broad-based domestic support for strong IP enforcement. While acknowledging progress in recent years, the U.S. government also continues to cite various weaknesses in the three countries’ IP laws and regulations that need to be addressed. The U.S. government has identified weak enforcement as a key IP issue in China, India, and Thailand. According to the U.S. government, the extent to which existing IP laws and regulations are enforced and pursued through the courts in the three case study countries is limited and inconsistent. According to various U.S. officials we interviewed overseas, enforcement tends to be particularly weak and inconsistent outside of major commercial centers. For instance, some U.S. officials in China noted that cases of IP enforcement are much more common in large cities such as Beijing and Shanghai than in other parts of the country. In India, U.S. officials noted that IP enforcement is weak in much of the country with significant variations in the level of enforcement among India’s 28 states. While the three countries have taken some steps to demonstrate an increased emphasis on IP enforcement, various U.S. officials in the three countries stated that there continues to be an uneven commitment to such efforts. A range of U.S. officials and private-sector representatives we met with made the point that all three countries are increasingly looking to be centers of innovation and that there is a growing awareness that domestic production of IP is important for their economic development. As this process occurs, various U.S. officials and private-sector representatives we interviewed believe that the three countries will have a greater incentive for strong IP enforcement.