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 foreign GIs. We are exploring the possibility of addressing these concerns in order to reach a satisfactory settlement with the EU. If a mutually agreeable solution can not be found, the United States may have no option but to continue to pursue resolution through WTO dispute settlement procedures.

HUNGARY

Hungary does not provide adequate protection for confidential test data submitted by pharmaceutical companies for marketing approval, which appears to violate its obligations under Article 39.3 of the TRIPS Agreement. While Hungary has repeatedly indicated that it disagrees with this interpretation of TRIPS, it intends to put very limited data exclusivity into place effective January 1, 2003, in order to comply with EU directives. U.S. pharmaceutical products remain vulnerable to exploitation by large and aggressive Hungarian pharmaceutical copiers. On other legislative matters, Hungary seems to have made substantial progress in bringing its copyright, patent, trademark, customs code, and criminal and civil codes into conformity with its IPR obligations under the TRIPS Agreement and under the U.S.-Hungary bilateral IPR agreement. Enforcement, however, remains problematic and piracy remains moderately high. The U.S. Government urges Hungarian prosecutors and judicial authorities to take a more proactive approach to the enforcement of intellectual property rights.

INDIA

India's patent system and protection of exclusive test data appear far from compliant with its obligations under the TRIPS Agreement. The term of protection for pharmaceutical process patents is only seven years. India fails to provide patent protection for pharmaceutical and agricultural chemical products and the compulsory licensing system seems overly broad. Also, pending legislation meant to rectify India's TRIPS deficiencies may fall short of that goal. To make matters worse, the inadequate patent protection currently available is difficult for innovators to obtain: India's patent office suffers from a backlog of 30,000 patent applications and a severe shortage of patent examiners. Moreover, India's overly-generous opposition procedures often allow competitors to delay patent issuance until the patent has expired, resulting in a de facto removal of patent protection. In addition, India's copyright law, which is generally consistent with international standards, was weakened by amendments enacted in 2000 that undermine protection for computer programs. Enforcement against piracy remains a growing concern for U.S. copyright industries, especially given that pirated imports are entering the market from Southeast Asia and that there is growing Internet piracy. We will continue to consult with the Indian Government to resolve outstanding TRIPS compliance concerns, but if these consultations do not prove constructive, we will consider all other options available, including WTO dispute settlement, to resolve these concerns.

INDONESIA

Indonesia demonstrated some improvements to its intellectual property rights regime in 2001. While