TIPO held a forum on the compulsory licensing provisions in its Patent Act on July 8 and has pledged to amend the Act by the end of the year.

The dispute with Philips began in July 2004 when TIPO granted five compulsory licences to local recordable CD-maker Gigastorage for patents held by Philips. Gigastorage had previously licensed the patents from Philips until the Dutch company terminated its business agreement with the company in April 2001.

In June 2006 the Committee of Appeal of the Ministry of Economic Affairs confirmed TIPO's original decision to grant a licence. Philips then appealed to the Administrative Court and subsequently filed a formal request to the European Commission to ask it to help the company seek a ruling from the WTO in the dispute.

In February, the Commission issued a report strongly condemning Taiwan's compulsory licensing system and arguing that the compulsory licence law did not comply with TRIPs.

EU Trade Commissioner Peter Mandelson threatened to take Taiwan to the WTO, stating: "I hope that the Taiwanese authorities will move quickly to bring their law and practice into line with WTO rules. I cannot rule out seeking WTO dispute settlement if they do not."

But in March, the Taipei High Administrative Court overturned the Committee of Appeal decision. After the decision by the Administrative Court the application went back to TIPO for review, but Gigastorage withdrew its application on May 15, which ended the dispute.