Intellectual Property:

Strategy for Targeting Organized Piracy (STOP) Requires Changes for Long-Term Success

GAO-07-74: Published: Nov 8, 2006. Publicly Released: Dec 8, 2006.

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U.S. government efforts to protect and enforce intellectual property (IP) rights are crucial to preventing billions of dollars in losses and mitigating health and safety risks from trade in counterfeit and pirated goods. These efforts are coordinated through the National Intellectual Property Law Enforcement Coordination Council (NIPLECC), created by Congress in 1999, and the Strategy for Targeting Organized Piracy (STOP), initiated by the Bush administration in 2004. This report describes the evolution of NIPLECC and STOP, assesses the extent to which STOP addresses the desirable characteristics of an effective national strategy, and evaluates the challenges to implementing a strategy for protecting and enforcing IP rights. GAO examined relevant documents, interviewed agency and industry officials, and assessed STOP using criteria previously developed by GAO.

Although NIPLECC and STOP originated under different authorities, the lines between them have become increasingly blurred. NIPLECC is a coordinating council, while STOP is a strategy involving coordination led by the National Security Council. While NIPLECC has struggled to define its purpose, STOP generated coordination and attention to IP protection from the outset. Congress gave NIPLECC an oversight role, funding, and an IP Coordinator as its head in 2005, but STOP remains prominent. Their functions, however, increasingly overlap. The IP Coordinator regularly conducts STOP activities and speaks for STOP before Congress and private industry. Most significantly, NIPLECC recently adopted STOP as its strategy. STOP is a good first step toward a comprehensive integrated national strategy to protect and enforce IP rights and has energized protection efforts. GAO found, however, that STOP's potential is limited because it does not fully address the characteristics of an effective national strategy, which GAO believes helps increase the likelihood of accountability, as well as effectiveness. STOP does not fully address characteristics related to planning and accountability. For example, its performance measures lack baselines and targets. STOP lacks a discussion of costs, the types and sources of investments needed, and processes to address risk management. Finally, STOP lacks a full discussion oversight responsibility. The current structures present several challenges to implementing a long-term strategy. First, NIPLECC retains an image of inactivity, and many private sector groups GAO interviewed were unclear about its role. STOP, despite its energy and prominence, lacks permanence beyond the current administration. Second, NIPLECC's commitment to implementing an effective strategy is unclear. For instance, NIPLECC's recent annual report does not explain how it plans to provide oversight. NIPLECC officials have sent mixed signals about STOP's role, with one saying STOP should include metrics to measure progress, and another calling STOP an account of administration efforts, not a strategy.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: In October 2008, Congress passed the Prioritizing Resources and Organization for Intellectual Property Act (P.L.110-403) establishing the Intellectual Property Enforcement Coordinator (IPEC) and requiring the IPEC to work with relevant federal agencies to create a joint strategic plan against counterfeiting and piracy. The act outlined specific content requirements that reflect the characteristics of an effective national strategy as outlined by GAO. During congressional deliberation and in committee reports about the Act, the sponsoring committee cited this and other GAO reports and testimony on the subject. In June 2010, the IP Enforcement Coordinator (IPEC), working across numerous federal agencies and departments with significant input from the public, released a 2010 Joint Strategic Plan on Intellectual Property Enforcement. The plan addresses all 6 desirable characteristics of a national strategy. For example, the joint strategic plan provides information on the plan's purpose, scope, and methodology; whereas, STOP did not provide information on its methodology. Unlike STOP, the plan includes a description of priorities (called "categories of focus") for carrying out the plan's objectives. It also describes the "action items" to be employed to achieve these priorities. In addition, the plan established five performance indicators for IP protection and enforcement and reported that this initial list is subject to modification based on the U.S. government's experience collecting and analyzing indicators. Unlike STOP, the plan also identifies agencies responsible for reporting enforcement activities on an annual basis as well as other activities. While STOP did not address the desirable characteristic encompassing resources, investments and risk management, the joint strategic plan provides some information on resources, investments, and risk management. The plan identifies the sources of domestic and overseas federal resources and state, local and private effort and discusses where resources should be targeted. Although the plan did not include actual estimates of the resources needed to fulfill the plan's priorities because of data collection and analysis was still in progress, the plan included a strategy for data collection and analysis needed to establish resources estimates. The plan stated that the IPEC will collect annually the amount of U.S. government resources spent on IP enforcement personnel, technologies, programs, and other efforts. The joint strategic plan also identifies organizational roles and responsible departments and agencies and specifically identifies sources for about two thirds of the 33 action items. Ensuring efficiency and coordination is a stated priority and the joint strategic plan outlines 6 actions items specifically related to coordinating federal, state, local, private sector, and international resources. Problem definition and risk assessment are also provided in the joint strategic plan, and unlike STOP, provides a discussion on of the quality of the data. Lastly, the plan addresses integration, by associating its goals with specific member agencies.

    Recommendation: To improve STOP's effectiveness as a planning tool and its usefulness to Congress, the IP Coordinator, in consultation with the National Security Council and the six STOP agencies, including the Departments of Commerce, Homeland Security, Justice, and State; and the Office of the U.S. Trade Representative; and the Food and Drug Administration, should take steps to ensure that STOP fully addresses the six desirable characteristics of a national strategy.

    Agency Affected: National Intellectual Property Law Enforcement Coordination Council (NIPLECC)

  2. Status: Closed - Implemented

    Comments: In October 2008, Congress passed the Prioritizing Resources and Organization for Intellectual Property Act (S. 3325) clarifying the oversight and accountability responsibilities in implementing a national intellectual property (IP) strategy. This act created the IP Enforcement Coordinator (IPEC) to serve within the Executive Office of the President. The act outlines the IPEC's duties and includes specific efforts to enhance interagency coordination, such as the creation of an interagency advisory committee (chaired by the IPEC), and the development of a comprehensive joint strategic plan. The act abolished NIPLECC and eliminated the IP Coordinator position, replacing it with the IPEC and the interagency advisory committee. The act includes mechanisms to hold the IPEC and participating agencies accountable for implementing the joint strategic plan and clarifies their oversight roles. For example, the act calls for the IPEC to report to the President and on IP enforcement programs and the implementation of the joint strategic plan. In addition, the IPEC must submit a joint strategic plan to Congress every three years Congress and an annual report on the activities of the advisory committee no later than December 31 of each calendar year. The annual report must include information on progress made in implementing the plan and fulfillment of the plan?s priorities as well as an assessment of the successes and shortcomings of the efforts of the federal government, including advisory committee members. The act also sets out content requirement for the joint strategic plan, including the identification of the departments and agencies that will be involved in implementing the plan?s priorities.

    Recommendation: To clarify NIPLECC's oversight role with regard to STOP, the IP Coordinator, in consultation with National Security Council and the six STOP agencies, including the Departments of Commerce, Homeland Security, Justice, and State; and the Office of the U.S. Trade Representative; and the Food and Drug Administration, should clarify in the STOP strategy how NIPLECC will carry out its oversight and accountability responsibilities in implementing STOP as its strategy.

    Agency Affected: National Intellectual Property Law Enforcement Coordination Council (NIPLECC)

 

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