UNCLAS SECTION 01 OF 02 COLOMBO 001386

SIPDIS

DEPT PASS TO USTR

E.O. 12958: N/A
TAGS: ECON ETRD KIPR CE WTO USTR ECONOMICS
SUBJECT: SRI LANKAN PARLIAMENT PASSES NEW IPR LAW

Refs: A)Colombo 1160, B)COLOMBO 257, C)02 Colombo 2196


1. Summary: The Sri Lankan Parliament approved an
Intellectual Property Rights (IPR) law on July 25, 2003.
It will come into effect when the Speaker of the
Parliament signs the bill, expected in August. The new
IPR law is WTO TRIPS compliant. It provides for improved
coverage, and contains provisions for an enhanced
enforcement regime, which would address a major weakness
in the existing law. End Summary


2. On July 25, the Sri Lankan Parliament approved a long-
anticipated IPR law by a vote of 99-59. It will come into
effect when the Speaker of the Parliament signs the bill,
currently expected to happen in August. Passage was
delayed approximately two months by a court case, which
resulted in amendments to allow compulsory licensing and
parallel imports. These amendments were required by the
Supreme Court, which ruled that certain provisions in the
bill on patents were inconsistent with the Constitution
and violated fundamental rights of the people of Sri
Lanka. The petitioners, an AIDS activist and a think-
tank, stated that the bill allowed patent owners,
especially pharmaceutical companies, to control the
supply and prices of drugs.


3. Parliamentary debate on the bill lasted two days. On
the first day, several Members of Parliament, including
opposition members, generally spoke in favor of the bill,
stressing the need to protect copyrights, especially of
local artists. On the last day of the vote, however, the
opposition members of the People's Alliance and JVP
opposed the bill, saying the bill should be re-published
and presented for public comment again before
parliamentary approval. The opposition claimed the
government was introducing several last minute changes,
and alleged that the GSL was not carrying out the Supreme
Court directions properly.


4. The Government maintained that it was amending only
the clauses suggested by the Court and there was no need
for further delays. According to the Director General of
Intellectual Property of Sri Lanka, Dr. D.M. Karunaratne,
the Attorney General had approved the amendments to the
legislation, in accordance with the Court ruling.
Karunaratne believes the opposition members did not fully
understand the legal changes made in the bill.
Government officials and other critics blame the
opposition reaction on divisive politics rather than on
any technical or legal grounds.


5. The new IPR law is WTO TRIPS compliant. It protects
and governs copyrights of artistic, literary and
scientific work, related rights, industrial designs,
patents, marks and trade names, layout designs of
integrated circuits, unfair competition, undisclosed
information and geographical information. The
preparation of the new law took years, under several
governments, and was actively promoted by the Embassy and
official USG visitors (see reftels). Several US parties,
including USAID consultants and the Motion Picture
Association of America (MPAA), reviewed the draft law and
provided comments. Sri Lanka still needs to ratify and
conform to the recent WIPO Performances and Phonograms
Treaty (WPPT) and the WIPO Copyright Treaty (WCT).
According to Dr. Karunaratne, certain provisions in the
new law, such as communication to the public, conform to
some provisions in these treaties, but not all.


6. The new law provides for an improved enforcement
mechanism. Currently, enforcement is a serious problem
as is the lack of public awareness of IPR. The
Government does not act as an enforcer of IPR laws,
partially due to weaknesses in the existing law. For
example, under copyrights, the previous law covered only
the reproduction of works, not the sale, rental or export
of counterfeits. The new IPR law brings copyright law up
to WTO and Bern Convention requirements, with expanded
relief including powers to impound or destroy copies,
packaging and implements used for making copies, and
enhanced fines. It also brings amendments to the Customs
Ordinance, allowing Customs to detect import and export
of counterfeit products, which will now be prohibited.
At present, aggrieved parties must, on their own, seek
redress of any IPR violation through the courts, often a
slow process.

7. Local agents of reputed US and other international
recording, software development and motion picture
companies continue to complain that lack of IPR
protection is damaging their businesses. The Embassy,
along with key industry players including the IFPI,
continues to lobby for improvements in Sri Lanka's IPR
regime. The Embassy has convened a group of US companies
adversely affected by IPR violations to engage the
government on enforcement and to enhance public
awareness.

Entwistle