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EU threatens Taiwan with WTO complaint over Philips CD patents

The European Union threatened Taiwan with a World Trade Organization complaint over the use of compact-disc technology, seeking to protect patents owned by Royal Philips Electronics NV.

The EU opened a probe into Taiwan's practice of letting domestic producers of blank CDs use patents without having to negotiate a licensing agreement with the owner. Netherlands-based Royal Philips Electronics NV, which invented some of the technologies for recordable CDs and holds related patents, complained about the use of five of its patents by Taiwan's Gigastorage Corp. under a compulsory-licensing system. „The proper enforcement of intellectual property rights is one of the central planks of the EU's global” commercial strategy, European Trade Commissioner Peter Mandelson said in a statement today in Brussels. „The allegations made in respect of the grant of these compulsory licenses give ground for substantial concerns.”
The 27-nation EU is stepping up the fight against violations of intellectual property rights in a bid to enforce WTO rules and help European technology companies gain revenue in emerging markets. Taiwan, according to the EU, makes 80% of the world's blank CDs, which store data or music. The probe by the European Commission, the EU's regulatory arm, will last as long as five months. Should the commission conclude that Taiwan's measures amount to unfair trade obstacles, it would give Taiwan a chance to change policies or have the right to complain to the Geneva-based WTO. „I am hopeful that we can find a means to resolve any WTO violations identified in the investigation,” Mandelson said. (Bloomberg)