Italy was sharply criticised by the US ambassador to Rome on Wednesday over the quantity of fake and counterfeit goods produced in the country.
"American interests suffer huge damage in Italy. This is simply unacceptable," said Ambassador Ronald Spogli, during a bilateral conference devoted to the issue of intellectual property.
Spogli noted that Italy was still on a US list of trading partners under observation in Washington because of concern over the level of protection for intellectual property.
Seeing an important ally such as Italy on this list was "frankly not very encouraging," the ambassador said at the conference which was also attended by Italian Foreign Minister Massimo D'Alema and Justice Minister Clemente Mastella.
Italy is Europe's biggest producer of fake or illegally copied goods, according to the latest figures from retailers' association Confcommercio. It said the business is worth some 7 billion euros a year.
Almost half the items sold fall into the categories of clothing, handbags, DVDs and computer software and some 16% of the population admits to having bought such an article in the last year.
In response to Spogli's reproof, D'Alema said Italy was working to "step up efforts" to battle commercial piracy in the hope of being removed from the US's 'Watch List'.
Inclusion in the US's list can lead to sanctions in the worst cases. No sanctions are envisaged against Italy, even though it is believed to be the world's third biggest producer of pirated goods.
In 2006 the US drew up a second, shorter list of countries with the worst piracy problems. It was called the Priority List and included China, Russia, Argentina, Chile and Russia, but not Italy.
"Italy has good laws in this area and has equipped itself with important tools but more commitment is needed from the police, the judiciary and also state authorities," D'Alema said.
He noted that Italy, whose economy is "based largely on intellectual content and creativity", was also hit badly by the roaring trade in fake handbags and illegally copied films.
The reaction from Italy's foreign trade minister, Emma Bonino, was less diplomatic. "It is pathetic that Italy should be on this list. Instead of monitoring each other like this it would be better to join forces" in the battle against fake goods, she said.
Another response to Spogli came from Italian farmers' association Coldiretti, which said that piracy was also a problem in the United States, especially in the area of food.
Nine out of ten supposedly Italian cheeses sold in the US were in fact inferior imitations produced in California or Wisconsin, it said.
