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 COLOMBIA

During 2003, the Government of Colombia continued to demonstrate a commitment to strengthen IPR protection including passing a decree to provide data protection for agricultural chemicals, and increasing enforcement actions. However, high levels of piracy and lack of successful prosecutions for IPR infringement remain a problem. In addition, new IP protections such as Decree 2085, which protects confidential test data for pharmaceutical products remain subject to legal challenge, and enforcement needs to be more effective. Piracy levels in Colombia amount to three-quarters of the market for recorded music and motion pictures, and half of the market for business software; the publishing industry continues to suffer from piracy, especially photocopying piracy. Piracy of music CDs is on the increase, threatening to erode legitimate markets altogether, mostly due to local, cottage-shop CD-R duplication. The recent growth of optical disc piracy also threatens the new, legitimate DVD market. Efforts to combat piracy through raids and other enforcement measures are hindered by a judicial system that fails to actively prosecute cases or issue deterrent penalties. Enforcement of trademark legislation in Colombia is showing some signs of progress, but contraband and counterfeiting are widespread and need to be stemmed by the Government of Colombia. The United States urges Colombia to ensure that its criminal, administrative, civil and border enforcement procedures meet its bilateral and multilateral intellectual property enforcement obligations and are effectively implemented.

COSTA RICA

In January 2004, Costa Rica joined the Central American Free Trade Agreement, a step that will considerably upgrade the level of protection in Costa Rica's intellectual property regime. However, Costa Rica still faces IPR enforcement problems and, as such, shall remain on the Watch List. While the United States notes Costa Rica's efforts to ensure that local legislation conforms with the TRIPS Agreement, Costa Rica still needs to improve its criminal and civil systems of intellectual property enforcement, including establishing a specialized intellectual property prosecutor and by increasing resources to bolster enforcement efforts in the Ministry of Public Safety's Intellectual Property office. Furthermore, the Government of Costa Rica must make significant modifications and clarifications in the area of data protection as the CAFTA commitments come into effect. Also, the Government of Costa Rica must improve protection of new plant varieties and provide for stronger penalties for infringement. We encourage the Government of Costa Rica to take action in 2004 to improve the shortcomings in its criminal and civil systems of intellectual property enforcement by assigning priority and resources to these areas and to continue its work in ensuring that its local legislation conforms with CAFTA obligations.

CROATIA

In February 2004, the Croatian Government ratified the 1998 U.S.-Croatia MOU Concerning Intellectual Property Rights. Croatia currently is drafting implementing regulations that will bring the MOU into force. While the ratification of the MOU is a positive step in improving IPR protection in Croatia, problems still persist. Croatia remains on the Watch List due to concerns with its patent regime, specifically its failure to protect confidential data submitted for marketing authorization as required by TRIPS, lack of coordination between the patent and health authorities to prevent patent infringement by the grant of marketing approval for copycat pharmaceuticals, and failure to provide expeditious and timely judicial remedies to parties seeking to stop infringing activities. Furthermore, companies seeking to register pharmaceutical products with the Ministry of Health encounter a lengthy registration period. We will continue to monitor Croatia's progress in fulfilling its MOU obligations in the near term, including its prompt implementation of new regulations for data protection. We look to Croatia to