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While the United States is gratified by reports that illicit commercial-scale production of optical media in Israel may have fallen substantially, Israelís domestic market for copyright goods remains dominated by pirated music, video and software CDs. Further, Israel is part of an enormous transshipment network for pirated versions of Russian-language software, as well as audio and video CDs and cassettes. While enforcement of copyright has improved in the public sector, enforcement against piracy in the private sector needs to be strengthened further. Israel has demonstrated that it is serious about addressing piracy and has translated this commitment into action by increasing its special police intellectual property rights enforcement units, but these units remain too small and underfunded to be effective. Even when they do act, convictions are rare and do not result in deterrent penalties. Patent protection in Israel is inadequate. In May 2000, the Minister of Health approved regulations permitting the parallel import of pharmaceuticals protected by patents. Further, Israel allows generic pharmaceutical manufacturers to obtain marketing approval based on confidential test data submitted by innovator pharmaceutical firms. Israelís failure to protect this data, generated at great expense by the innovators, appears to be a violation of its obligations under Article 39.3 of TRIPS. We have continuing consultations with the Israeli Government on intellectual property issues, and we hope these will soon bear fruit. If there is no progress in the data protection area, the United States will need to consider other options for encouraging Israel to remedy this situation.
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