Taipei's chance of gaining improved trade status with the US has suffered an apparent setback with a report by the White House to Congress on global trade issues that finds Taiwan deficient in several areas of bilateral trade relations, including intellectual piracy, telecommunications, agriculture and pharmaceuticals.
The report, an annual discussion of trade agreements which the US is engaged in, is considered as reflecting the basis for the administration's decision, due at the end of April, on whether to remove Taiwan from its "Priority Watch List" under its Special 301 law regarding intellectual property rights violations.
It is also seen as an important barometer of when and whether the US will enter into a Free Trade Agreement with Taipei, an agreement that would have tremendous symbolic value as a measure of overall bilateral ties, including political relations.
"The level of intellectual property [IP] piracy in Taiwan remains at a very high level," says the report, prepared by the US Trade Representative's office. "Minimal progress was made in strengthening its intellectual property rights protection regime during the past year," the report noted.
While the report cited Taiwan's efforts to modify its copyright laws in response to US requests, it says "the latest drafts of these amendments may not adequately protect IPR in Taiwan if the authorities exempt some infringements from `public offense' status."
Although the government declared last year an "action year" against piracy, "continued pirating of optical media, failure to shut down counterfeit and IPR-infringing facilities and the export of pirated and counterfeit goods overseas led the US to urge the Taiwanese government to further improve its enforcement and legal framework for IPR protection," the report noted.
On telecommunications, while Taipei committed itself under its WTO accession agreement to fully open the telecommunications service market, it "has not implemented the legal regime or licensing criteria to provide new licenses for local, domestic long distance, and international services" despite repeated US requests, the report says.
It also faults Taipei's action on the direct sale of fiber-optic submarine cable and the development of new criteria regarding issuing of new fixed-line telecommunications licenses.
On agriculture, the USTR takes Taiwan to task for being late in implementing its tariff-rate and market access quotas on rice, chicken, pork, and other products specified in the WTO commitments. The rice import system was "particularly troublesome," the report says. As part of its WTO commitment, Taiwan agreed to consult with Washington on rice imports.
Market entry for new pharmaceuticals also came in for criticism in the US report.
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