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 dispute settlement proceeding regarding Japan's failure to provide an adequate term of protection for pre-existing sound recordings.


 * While progress has been made over the past year, major problems from last year's review remain, including lack of adequate protection for trade secrets, software, textile designs and trade dress. Administrative measures were taken in early 1996 to enhance the protection of well-known U.S. trademarks, but the effectiveness of that system is uncertain at this time and we will continue to monitor it closely. Large end-user piracy of software continues to be a problem. A particularly serious problem with Korea's legal system is its failure to provide full retroactive copyright protection for pre-1957 works as required under the TRIPs Agreement.

has been on the priority watch list since 1992 largely because it has had inadequate intellectual property laws and its enforcement efforts have been ineffective. Copyright and patent piracy are widespread. As part of Turkey's entry into a customs union with the EU. Turkey has agreed to continue to improve its intellectual property protection. Turkey also maintains a discriminatory 25 percent municipality tax only on receipts from the showing of foreign films in a manner inconsistent with the national treatment obligations of Article III of the GATT 1994. The Administration will invoke formal consultations with Turkey under WTO's dispute settlement procedures in the near future with respect to this matter.

In reviewing the practices of our trading partners, the USTR has decided that 26 countries should be placed on the "watch list". The Administration uses the "watch list" as a means of monitoring progress in implementing commitments with regard to the protection of intellectual property rights and for providing comparable market access for U.S. intellectual property products.

Countries placed on the watch list are:


 * The Government of Australia does not provide adequate protection for test data submitted to regulatory authorities for the marketing approval of pharmaceuticals and agricultural chemicals. Such data are developed at great expense to the originating company. Australia allows competing companies to rely indirectly on such data to support their own later-filed applications. In addition to concerns about WTO consistency, permitting this to occur unfairly allows later applicants to free-ride on the first applicant's significant investment in developing the data and puts the first applicant at a competitive disadvantage. Australia very recently has taken some steps to address our concerns. The Administration would be prepared to reconsider this listing when Australia provides adequate and effective protection for test data.

expressed its intent to join international intellectual property conventions in February 1995. The U.S. urges Bahrain to bring its copyright regime into line with its obligations under the Berne Convention and the WTO, and to begin to take effective enforcement action against