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 HUNGARY Hungary will remain on the Watch List in 2006. Hungary has improved its IPR regime over the past several years, including the recent passage of IPR enforcement legislation, but additional improvements are necessary. The United States notes, however, that copyright piracy in Hungary continues to grow, due in large part to copyright piracy on the Internet. Enforcement deficiencies include prosecutorial delays, judicial imposition of low fines or weak sentences, and weak border enforcement. Hungary does not provide an effective coordination system between its health and patent authorities to prevent the issuance of marketing approvals for unauthorized patent-infringing copies of pharmaceutical products. The United States urges the Hungarian Government to address these issues and to continue to improve its IPR enforcement efforts.

ITALY Italy will remain on the Watch List for 2006. Despite Italy's passage of strong copyright laws, increased enforcement actions, and the decline of piracy rates in the sectors of business software, music, and entertainment software, U.S. industry reports that Italy continues to possess one of the highest overall piracy rates in Western Europe and chronic problems with copyright piracy on the Internet. Although Italy has made some progress through increased raids, seizures, and arrests of IPR infringers, there is inadequate judicial enforcement and a lack of judicial imposition of deterrent fines and jail sentences for criminal copyright and trademark infringers. The United States continues to observe wide variations in the effectiveness of IPR enforcement activities within Italy. The United States will continue to work with Italy to improve its IPR awareness and to improve IPR protection and enforcement.

JAMAICA Jamaica will remain on the Watch List in 2006. The United States remains concerned over Jamaica's continued delay in enacting the Patents and Designs Act, which is intended to implement Jamaica's obligations under the TRIPS Agreement and to comply with the United States-Jamaica bilateral Intellectual Property Agreement. The United States urges the Government of Jamaica to reform its patent law as soon as possible to comply fully with international standards for patent protection.

KUWAIT Kuwait will be downgraded from the Priority Watch List to the Watch List due to significant improvements in its IPR regime this past year, particularly in the area of IPR enforcement actions. This year, Kuwaiti Customs and the Ministry of Commerce and Industry improved their IPR enforcement efforts. A new IPR committee was formed that includes the Ministries of Justice, Interior, Information, and Commerce and Industry, and Kuwait is in the process of establishing a new IPR court. The Ministry of Education initiated a program to combat book piracy, and the Ministry of Information conducted numerous raids on pirates and counterfeiters. The United States hopes that Kuwait will continue to improve its IPR regime by ensuring, for example, that law enforcement officials are engaged in combating piracy and counterfeiting, that judicial authorities impose deterrent penalties for IPR violations, and that necessary legislation is passed to strengthen its IPR regime. The United States is concerned that several key pieces of IPR legislation (including amendments in the areas of copyrights, trademarks, geographical indications, patents, data protection, and enforcement) have been pending for many years, and hopes that Kuwait will expeditiously enact and implement such legislation in the near term. The