By Doug Palmer

WASHINGTON (Reuters) - The United States and the
European Union have resolved a fight over protections for
geographically based food names that was one of last obstacles
to reaching a new international pact to fight growing trade in
counterfeit goods, a U.S. official said Monday.

"We found the solution even on that toughest of issues,"
the U.S. trade official told Reuters in a briefing on a
tentative deal struck over the weekend in Tokyo on the proposed
Anti-Counterfeiting Trade Agreement.

The official, who spoke on condition that he not be
identified, said the text of the proposed agreement could be
released as early as Wednesday.

Most of the language has been finalized, but negotiators
left some words in italics because they needed to consult with
their superiors back home before giving final agreement.

The United States hopes that process will move very
quickly, so that the nearly 40 countries that participated in
the talks can make their final decision whether to sign the
pact or not, the U.S. official said.

The talks involved the United States, the EU and its 27
member states, Australia, Canada, Japan, New Zealand,
Singapore, South Korea and two developing countries, Morocco
and Mexico, which together have agreed to take a stand against
the growing global trade in fake and pirated goods.

"Here you have a group of countries representing a very
substantial part of global trade saying we are not willing to
look the other way from this challenge. We're going to confront
it head on with stronger laws, stronger cooperation and
stronger enforcement actions," the U.S. official said.

China, the source of much of world's counterfeit goods
production, was not a party to the talks.

The Organization for Economic Cooperation and Developments
has estimated that global trade in counterfeit and pirated
goods rose from about $100 billion annually in 2000 to about
$250 billion in 2007.

Both digital rights and public health advocates have
closely watched the talks, which some have feared could
infringe on the rights of Internet users or disrupt trade in
generic versions of life-saving medicines.

The pact does not require approval from Congress, and it is
ultimately up to President Barack Obama's administration to
decide whether to sign the agreement or not.

One of the last issues resolved stemmed from a long-running
battle between the United States and the EU over the right to
use European place names, like Champagne, Parma or Roquefort,
for some of the world's most popular foods and beverages.

U.S. business groups worried that the EU's demand to cover
"geographical indicators" in the pact could mean American
products as commonplace as Kraft parmesan cheese could be
treated as illegal items and subject to customs seizures.

Meanwhile, EU companies worried that "sui generis"
protections for geographical indicators outside of the
trademark system would not have the same status under the pact
as other intellectual property.

"Essentially, the core of the compromise is ... that
parties should provide border measures without discriminating
between various IP rights," the U.S. official said.

"The EU didn't want there to be a situation created where
you're discriminating in favor of trademarks, that trademarks
get better protection than these sui generis GI regimes.

"So, they were able to take comfort from the principle that
a party should not discriminate between intellectual property
rights and that parties should avoid creating barriers to
legitimate trade," the U.S. official said.
(Reporting by Doug Palmer; Editing by Chris Wilson)