The last year has seen continued progress in the protection of intellectual property rights (IPR) and the making of IPR a priority by the Chinese government. Strong statements by State Council leaders have demonstrated the governments understanding of the widespread economic losses suffered by Chinese and foreign firms alike due to IPR violations. Moreover, the State Council clearly understands that the lack of IPR protection is a severe constraint on the development of creative products. Investments in R&D cannot be made without a reasonable assurance that the resulting intellectual property will be protected long enough to earn an economic return. Software designers, authors, filmmakers, musicians, and others cannot earn a living if their products are immediately pirated. Additionally, the export of counterfeit and pirated products is expected to increase as trade is stimulated by China's accession to the World Trade Organization (WTO), increasing the risk of friction with trading partners and damage to China's international reputation. The high priority given to IPR protection by the State Council has been expressed in its continual promulgation of legislation, administrative regulations, and enforcement guidelines.