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copyright infringement. This procedure is mandated by TRIPS Article 50. Retroactive protection for works and sound recordings, also required under TRIPS, is absent from Czech law. Moreover, there has been insufficient improvement over the last year in the enforcement of rights that do currently exist under Czech law. The U.S. is concerned that the situation has the potential to worsen, especially with respect to optical media (CD, CD-ROM, and DVDs) piracy, if courts, prosecutors and police continue to fail in providing effective deterrent enforcement. We look to the Czech Republic to improve its enforcement structure and will conduct an out-of-cycle review of the Czech Republic's progress toward addressing these concerns in September 1999.
Denmark: In 1997, the United States initiated WTO dispute settlement proceedings against Denmark because of concern that Denmark had not implemented the TRIPS obligation requiring provisional remedies, including ex parte procedures in civil enforcement proceedings. Courts must be granted the ability to order unannounced raids in appropriate cases to determine whether infringement is taking place and to preserve evidence of infringements as well as the ability to order that allegedly infringing activities be stopped pending the outcome of a civil infringement case. The availability of provisional relief in the context of civil proceedings is of particular importance to the software industry, as well as other industries dependent upon intellectual property protection. After numerous consultations with the United States, the Government of Denmark agreed to form a special committee to consider amending Danish law to provide this type of remedy. The work of the committee appears to be proceeding in the right direction, and we urge the Government of Denmark to move as expeditiously as possible to adopt appropriate legislative changes in 1999.
Ecuador: Ecuador enacted major legislation in May 1998 that met a number of TRIPS requirements. Ecuador recently established an IPR institute, the IEPI. Although it is not yet fully functional, the IEPI has begun enforcement actions against IP pirates. While the Government of Ecuador issued some pharmaceutical pipeline patents in the spring of 1998, there has been no recent progress in that area. Dealers' Act cases continued to be brought and to progress in the courts against U.S. companies, despite the September 1997 repeal of this Act. Its application prevents U.S. and other foreign suppliers from terminating distributorship contracts without mutual consent and judicial approval even if there was a unilateral termination clause in the contract. We also remain concerned about the lack of clarity regarding protection for confidential data submitted to government authorities for marketing approval.
Hungary: Hungary has been placed on the Special 301 Watch List because intellectual property protection has been inadequate and substantive gaps remain in the current copyright and patent laws that are not TRIPS consistent. Hungary needs to provide retroactive protection for pre-existing sound recordings. Also, prosecution against copyright piracy has been slow and has not posed an effective deterrent. Hungary needs to provide adequate legal protection for confidential test data and to refine its law on pipeline protection for pharmaceutical patents. The United States government urges the Hungarian government to address these deficiencies and use the time remaining prior to the deadline of January 1, 2000 to bring itself into full compliance with the obligations of the TRIPS agreement.
