ITALY

7. Protection of U.S. Intellectual Property

The Italian government is a member of the World Intellectual Property Organization, and a party to the Berne Convention for the Protection of Literary and Artistic Works, the Universal Copyright Convention, the Paris Convention for the Protection of Industrial Property, the Geneva Phonograms Convention, the Brussels Satellite Convention and the Patent Cooperation Treaty.

Intellectual property protection is troublesome because of inadequate enforcement of copyrights, including widespread record, video and computer software piracy. Because of the serious piracy problems, in May 1990 Italy was again placed on the U.S. Trade Representative's "Watch List" under the Special 301 provision of the 1988 Trade and Competitiveness Act.

To combat software piracy, a measure was introduced in 1989 into the Parliament which has the backing of Italian and U.S. software producers, but prospects for passage are uncertain. The Italian government supports provisions in the EC Software directive which have the potential to allow for reverse engineering of software, but has consulted closely with us to insure U.S. views are taken into account.

Italy is a net importer of intellectual property, particularly patents. We are unaware of any major trade cases in the last year that have arisen due to alleged patent infringement. U.S. pharmaceutical companies operating in Italy sometimes have complained about the excessive time required to bring a drug to market, and advocate a longer patent protection period for drugs.

The workers' statute of 1970 provides that "the right to establish trade union associations, to join them and to carry out union activities is guaranteed to all workers inside their places of work." Trade unions are not government controlled, and the constitution fully protects their right to strike, which is frequently exercised.

b. Right to Organize and Bargain Collectively

The right of workers to organize and bargain collectively is protected by the Constitution. Labor-management relations are governed by legislation, custom, collective bargaining agreements, and labor contracts. About 40 percent of Italian workers are covered by collective bargaining agreements. Voluntary, nonbinding mediation is provided by the Ministry of Labor and is often effective. There are no areas of the country, such as export processing zones, where union organizations and collective bargaining are impeded or discouraged.

C.

Prohibition of Forced or Compulsory Labor

Forced or compulsory labor does not exist.

ITALY

d. Minimum Age for Employment of Children

Under current legislation, no child under 15 may be employed, although the Ministry of Labor, having consulted with labor organizations, may authorize the employment on specific jobs of children over 12. The minimum age is 15 for men employed in dangerous, fatiguing, and unsanitary work, and 16 for men employed underground, in hazardous jobs or in Occupations harmful to the workers' morale. No women are employed underground and only those over 21 in dangerous, fatiguing, and unsanitary jobs.

Minimum work and safety standards are established by law and buttressed and extended in collective labor contracts. The basic law of 1923 provides for a maximum workweek of 48 hours--no more than 6 days per week and 8 hours per day. The 8-hour day may be exceeded for some special categories. Most labor agreements provide for a 36 to 38-hour week. Overtime may not exceed 2 hours daily or an average of 12 hours weekly. There is no minimum wage set under Italian law; basic wages and salaries are set in collective labor agreements. National collective labor agreements contain minimum standards to which individual employment agreements must conform. In the absence of agreement between the parties, the courts may step in to determine fair wages on the basis of practice in related activities or related collective agreements. Basic health and safety standards and guidelines for compensation for on-the-job injury exist in law and, in most cases, are exceeded in collective bargaining agreements.

f. Rights in Sectors with U.S. Investment

Workers in sectors with U.S. investment enjoy all the rights guaranteed under Italian law.

Source: U.S. Department of Commerce, Survey of Current Business

August 1990, Vol. 70, No. 8, Table 13

* Section 8 is an abridged version of Section 6 of the Italy country report included in the Department of State's Country Reports on Human Rights Practices for 1990, submitted to the Congress January 31, 1991. For a comprehensive discussion of worker rights, please refer to that report.

Sources: Central Bureau of Statistics (CBS), Netherlands Central

Bank, Central Planning Bureau (CPB)

THE NETHERLANDS

1. General Policy Framework

The Netherlands has an advanced industrial economy with four decades of prosperity behind it. Its major economic assets are a skilled, highly productive work force, substantial reserves of natural gas and its geographic location in northwest Europe at the mouth of the Rhine River. By tradition the Dutch are ardent supporters of the free trade principle, a philosophy which they defend in international fora like the GATT. The Netherlands is a member of the European Community (EC) and expects to benefit from the EC's efforts to build a single market by 1992. Since West Germany was their biggest trading partner, the Dutch also expect to gain from German reunification.

Dutch Gross National Product (GNP), boosted by strong domestic demand and expanding exports, grew 4.6 percent in 1989, while inflation was kept at 1.1 percent. High demand for Dutch exports produced an $8 billion current account surplus and contributed much of the impetus for economic growth.

The economy continued strong during the first half of 1990. The official Central Planning Bureau, however, predicted in a September report on the budget that GNP growth for the second half will slow down to a 3.35 percent annualized rate (based on an average oil price of $23 a barrel) because of decreased domestic demand and a reduction in world trade growth. Even lower GNP growth and somewhat higher inflation are likely if oil remains above $30 a barrel. Growth in 1991 will be hampered by reduced consumer demand caused by diminishing purchasing power and higher oil prices. Increased capital costs and lower profits will reduce the growth of real private investment to less than half of 1989's growth rate. GNP growth in 1991 will therefore primarily be export led. High oil prices will be partially offset by higher revenue from Holland's natural gas exports. The current account surplus in 1991 was forecast in September to reach $11 billion or close to 4 percent of GNP.

Unemployment and the government budget deficit remain the Netherlands' most serious economic problems. The level of government spending remains high at 39 percent of GNP. The government intends to reduce the deficit for 1990 to five percent of Net National Income (NNI), but authoritative sources think that increased government spending may prevent this target from being reached. Budget cuts of more than five billion guilders after 1991 will be necessary to reach the government target of 3.25 by 1994. And if the average contract wage rise in 1991 exceeds the government preferred limite of three percent growth over 1990 levels, the public sector wage bill will rise sharply, requiring another 10 billion gilders in budget cuts to keep deficit reduction on track.

In spite of a two percent annual growth in the number of employed persons over the past five years, unemployment presently stands at about nine percent of the labor force. (The official figure is five percent, but this only counts those who are actually registered as seeking work).

The Dutch guilder belongs to the European Monetary System and is tied closely to the Deutsch mark. Monetary policy is

THE NETHERLANDS

aimed exclusively at controlling inflation and is implemented through open-market operations and the imposition of reserve requirements on domestic banks.

The Netherlands is a highly receptive market for U.S. exports as well as an important investment partner. The U.S. trade surplus with the Netherlands ballooned to $6.3 billion in 1989, with a 16 percent gain in U.S. exports. The Netherlands is the third largest direct investor in the United States, behind the United Kingdom and Japan. Cumulative Dutch investment in the United States in 1989 grew to over $58 billion, with U.S. direct investment in the Netherlands valued at about $15 billion.

2. Exchange Rate Policies

The Dutch guilder is linked to the Deutsch mark in the European Monetary System. There are no multiple exchange rate mechanisms. While residents of the Netherlands must obtain an exchange license for certain large international financial transactions, in practice these licenses are granted routinely.

Dutch exports of goods and services were valued at more than 67 percent of GNP in 1989. It is not surprising that Holland is a strong supporter of free trade. Almost all purchasing decisions are made on the basis of non-discriminatory commercial criteria. Government procurement is done in compliance with the GATT Government Procurement Code. The Netherlands has no discriminatory export or import policies with the exception of those resulting from its membership in the European Community.

Increased momentum toward the European Community's goal of a unified internal market in 1992 has caught the attention of growing numbers of U.S. exporters eager to take advantage of Holland's position and experience as a distribution center for Europe. It has also sparked a wave of interest in investment in Holland as non-EC firms seek to get a foothold in the EC.

4. Debt Management Policies

The Netherlands is a major creditor nation, with a current account surplus expected to reach $8 billion in 1990. The country has no significant external debt. The Netherlands is a participant in and a strong supporter of the International Monetary Fund, the World Bank, and other multilateral financial institutions.

The government has given a high priority to reducing the government budget deficit as a percent of net national income. The figure had been as high as ten percent in 1984 and is about five percent in 1990. The government plans to reduce that figure to 3.25 percent in 1994.