Some of these have been effective,  particularly the Special 301 process that identifies inadequate IP  protection in other countries and the Intellectual Property Rights (IPR)  Training Coordination Group. NIPLECC members are from five agencies and  consist of: (1) Commerce’s Undersecretary for Intellectual Property and  Director of the United States Patent and Trademark Office; (2)  Commerce’s Undersecretary of International Trade; (3) the Department of  Justice’s Assistant Attorney General, Criminal Division; (4) the  Department of State’s Undersecretary for Economic and Agricultural  Affairs; (5) the Deputy United States Trade Representative; and (6) the  Department of Homeland Security’s Commissioner of U.S. Customs and  Border Protection. Coordination efforts involving IP law enforcement through NIPLECC have  not been as successful as other efforts. The IP Coordinator is also serving as the coordinator for STOP. STOP Has Energized U.S. Efforts, but Its Impact and Long- Term Viability Are Uncertain

STOP has energized U.S. efforts to protect and enforce IP and has initiated  some new efforts, however its long-term role is uncertain. One area where  STOP has increased efforts is outreach to foreign governments. Industry representatives  generally had positive views on STOP, although some thought that STOP  was a compilation of new and on-going U.S. agency activities that would  have occurred anyway. STOP’s lack of permanent status as a presidential  initiative and lack of accountability mechanisms could limit its long-term  impact. For example, the  United States and the European Union (EU) have formed the U.S.-EU  Working Group on Intellectual Property Rights, and in June 2006, the  United States and European Union announced an EU-U.S. Action Strategy  for Enforcement of IP Rights meant to strengthen cooperation in border  enforcement and encourage third countries to enforce and combat  counterfeiting and piracy. We  believe that accountability mechanisms are important to oversight of  federal agency efforts and can contribute to better performance on issues  such as IP protection. IP Enforcement Efforts at the Border Illustrate Challenges Facing STOP

One of STOP’s five goals is to increase federal efforts to seize counterfeit  goods at the border, but work we are conducting for this Subcommittee  illustrates the kind of challenges that STOP faces in achieving its goals. CBP and ICE are responsible for border enforcement efforts, but their top  priority is national security. CBP IP Seizures Have Increased in Number but the Estimated Value Has Fluctuated

STOP documents cite increases in IP-related seizures as a positive  indicator of its efforts to stop counterfeit goods at the border. In-Bond System Faces Persistent Control Weaknesses and Has Been Used to Circumvent IP Laws

The in-bond system has been identified by CBP and ICE officials as a  mechanism that has been used to circumvent import and IP laws and  regulations, presenting an enforcement challenge.
Why GAO Did This Study

U.S. goods are subject to substantial counterfeiting and piracy, creating health and safety hazards for consumers, damaging victimized companies, and threatening the U.S. economy. In 2004, the Bush administration launched the Strategy for Targeting Organized Piracy (STOP)--a multi-agency effort to better protect intellectual property (IP) by combating piracy and counterfeiting. This testimony, based on a prior GAO report as well as from observations from on-going work, describes (1) the range and effectiveness of multi-agency efforts on IP protection preceding STOP, (2) initial observations on the organization and efforts of STOP, and (3) initial observations on the efforts of U.S. agencies to prevent counterfeit and pirated goods from entering the United States, which relate to one of STOP's goals.

What GAO Found

STOP is the most recent in a number of efforts to coordinate interagency activity targeted at intellectual property (IP) protection. Some of these efforts have been effective and others less so. For example, the Special 301 process--the U.S. Trade Representative's process for identifying foreign countries that lack adequate IP protection--has been seen as effective because it compiles input from multiple agencies and serves to identify IP issues of concern in particular countries. Other interagency efforts, such as the National Intellectual Property Law Enforcement Coordination Council (NIPLECC), are viewed as being less effective because little has been produced beyond summarizing agencies' actions in the IP arena. While STOP has energized IP protection and enforcement efforts domestically and abroad, our initial work indicates that its long-term role is uncertain. STOP has been successful in fostering coordination, such as reaching out to foreign governments and private sector groups. Private sector views on STOP were generally positive; however, some stated that it emphasizes IP protection and enforcement efforts that would have occurred regardless of STOP's existence. STOP's lack of permanent status and accountability mechanisms pose challenges for its long-term impact and Congressional oversight. STOP faces challenges in meeting some of its objectives, such as increasing efforts to seize counterfeit goods at the border--an effort for which the Department of Homeland Security's Customs and Border Protection (CBP) and Immigration and Customs Enforcement are responsible. CBP has certain steps underway, but our initial work indicates that resources for IP enforcement at certain ports have declined as attention has shifted to national security concerns. In addition, prior GAO work found internal control weaknesses in an import mechanism through which a significant portion of imports flow, and which has been used to smuggle counterfeit goods.