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. Last Updated: 07/27/2016

Ukraine MPs Snub CD Piracy Law

APUkraine, one of the biggest producers of fake CDs in Europe, expects U.S. sanctions to cost the country $470 million a year.
KIEV -- Ukraine's attempts to avoid $75 million of U.S. trade sanctions suffered a severe blow Thursday after parliament refused to debate a law aimed at cracking down on pirated compact discs, which could cost Russia's southern neighbor about $470 million a year in export revenues.

President Leonid Kuchma and Prime Minister Anatoly Kinakh had this week urged deputies to resume debates on the bill to regulate CD production but the legislators declined Thursday even to include the issue on the session agenda.

"The decision means that we will have to start from anew again. The government will have to submit a new draft law and then we will debate it again," said Viktor Omelich, head of the parliamentary committee for regulations.

The United States announced it would impose sanctions on $75 million of Ukrainian exports in retaliation for the continued piracy of U.S. music compact discs and other optical recording products.

The sanctions would take effect from Jan. 23.

Industry experts say Ukraine is one of the biggest producers of fake CDs in Europe.

It is unclear when parliament may return to the issue.

Government officials say the sanctions would have a wider effect and the cash-strapped country could lose about $470 million a year in export revenues.

They say companies might have to cut thousands of jobs.

Ukraine's economic recovery has been mainly driven by exporters, which account for about half of gross domestic product. Prime Minister Kinakh has said the first quarter of 2002 may prove difficult because of export problems.

The government has been unsuccessfully trying to push the law through the parliament for the last two years but deputies have repeatedly rejected the bill that would require every CD producer to secure a production license.

Parliamentarians say the law would hurt the interests of domestic producers and make CDs unaffordable for the public.

Music and other CDs that sell for more than $15 in Western Europe cost about $3 for an identical copy in Kiev.

The piracy problem is also regarded as a major obstacle to Ukraine's campaign to become a member of the World Trade Organization.

Ukraine hopes to join the WTO by the year end.