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Bulgaria: U.S. Threatens Sanctions For Inaction Against CD Pirates

Sofia, 22 January 1998 (RFE/RL) -- Compact disks produced in Bulgaria have long been a legal problem with international repercussions. According to the Union for International Intellectual Ownership (UIIO), the small Bulgarian market has an annual consumption of about a million disks, but the capacity of production lines in the country is about 45 million disks.

The UIIO estimates that in 1997 alone Bulgarian pirate recordings inflicted losses on the international audio-recording industry of about $100 million. That organization has labeled Bulgaria as the second-largest pirate of international intellectual property in the world, behind China.

One major irony of the situation is that a number of the biggest CD-producing factories are state-owned.

The United States last week renewed its warning to Bulgaria about failure to take effective action against CD pirates, saying it could lead to American trade sanctions. The U.S. Trade Representative raised Bulgaria a further step up on its surveillance list and said that if Sofia fails to make substantial progress by April, it will be elevated to the highest level of concern and in line for sanctions.

The European Union is also deeply displeased. A visiting EU official (Vincent Pickett) said last year that in its association agreement with the EU, Sofia had undertaken specific obligations for protection of all authors' rights. He said the EU had concluded, however, that the commitment had not been observed, and he said that one of the reasons Bulgaria was still considered unsuitable for EU membership was the continuing production of pirate compact disks.

Hopefully, all that is about to change. On Monday (Jan. 19) the Bulgarian cabinet approved a decree regulating companies which copy, print, distribute or sell works of art or musical compositions. A key part of the decree makes a government license for production of compact disks obligatory. Under the new rules, penalties against the violation of author's rights will be considerably heavier than before. In cases where disks are produced without the proper license, all production capacity at that firm is to be sealed on the spot. A special computer codification is also required before the start of production, and this must be verified at the same time as a license is applied for. In addition a producer must keep an exact register of his production figures, titles, and of imported material.

This month Bulgarian police have undertaken big-scale checks of compact disk production lines. In mid-month units of the special anti-mafia police sub-division in Plovdiv, Bulgaria's second city, uncovered a depot with more than 50,000 illegal disks. According to police sources, some 100,000 illegal disks will soon be destroyed. The main destinations for the illegal export of pirate disks are Western Europe and Russia.

One thing the authorities want to make clear, however, is that the fight against the pirates does not imply a negative attitude towards all manufacturers of disks. Dimiter Entchev, the director of the authors' rights unit at the Ministry of Culture, said recently that as far as legal business goes, market forces will be allowed to determine which companies continue in business. Entchev noted the growing tendency among Bulgarian manufacturers to produce only blank disks, therefore avoiding the copyright problem. In this business Bulgaria can be a formidable competitor, because of the high quality and low prices of its products.