Identifier
Created
Classification
Origin
04BRASILIA222
2004-02-02 17:46:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Brasilia
Cable title:  

BRAZILIAN FEDERAL DEPUTIES DISCUSS PIRACY WITH GAO

Tags:  KIPR EIND ECON KCRM PGOV BR IPR 
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UNCLAS SECTION 01 OF 02 BRASILIA 000222 

SIPDIS

SENSITIVE

STATE FOR WHA/BSC AND EB/TPP/MTA/IPC
PLS PASS USTR FOR SCRONIN AND CBURKY
USDOC FOR 4322/ITA/MAC/WH/WBASTIAN/JANDERSEN/DMCDOUGALL
USDOC FOR 3134/USFCS/OIO/WH/DDEVITO/DANDERSON/EOLSON
NSC FOR MDEMPSEY

E.O. 12958: N/A
TAGS: KIPR EIND ECON KCRM PGOV BR IPR
SUBJECT: BRAZILIAN FEDERAL DEPUTIES DISCUSS PIRACY WITH GAO

Refs: A) 2003 Sao Paulo 2199 B) 2003 Brasilia 3868

UNCLAS SECTION 01 OF 02 BRASILIA 000222

SIPDIS

SENSITIVE

STATE FOR WHA/BSC AND EB/TPP/MTA/IPC
PLS PASS USTR FOR SCRONIN AND CBURKY
USDOC FOR 4322/ITA/MAC/WH/WBASTIAN/JANDERSEN/DMCDOUGALL
USDOC FOR 3134/USFCS/OIO/WH/DDEVITO/DANDERSON/EOLSON
NSC FOR MDEMPSEY

E.O. 12958: N/A
TAGS: KIPR EIND ECON KCRM PGOV BR IPR
SUBJECT: BRAZILIAN FEDERAL DEPUTIES DISCUSS PIRACY WITH GAO

Refs: A) 2003 Sao Paulo 2199 B) 2003 Brasilia 3868


1. (U) This is an action request - see para 9.


2. (U) Summary: Members of Brazil's Federal Chamber's
Investigative Commission (CPI) on Piracy briefed visitors from
the U.S. General Accounting Office and Emboffs on January 20.
Describing the work of the CPI and the extent of the piracy
problem in Brazil, the federal deputies expressed their
appreciation of the interest of the U.S. Congress in this issue
and signaled their desire for further consultations in
Washington. Biopiracy, threats to health and safety, raising
public consciousness and addressing the root causes of piracy
were among the issues covered. The CPI is making preparations
for drafting its final report (expected in June),planning town
hall meetings in several cities to engage the public as well as
a working group session with private-sector representatives
next week in Brasilia. End Summary.


3. (SBU) Just returning from the holidays to an extraordinary
session of the Congress called by the President, Brazilian
Federal Deputy Luiz Medeiros (PL-SP),met with visitors from
the U.S. General Accounting Office and Emboffs on January 20.
Medeiros presided over an hour-long session that included
expositions from other CPI members on subjects ranging from
biopiracy to China, questions and answers from the GAO team,
and his own vignettes from investigations. He began the meeting
by extolling the CPI's work and reputation. He recognized that
piracy in Brazil is intimately linked with corruption,
organized crime and the drug trade, citing the case of three
shopping centers selling pirated goods in Sao Paulo, owned and
operated by the Chinese mafia, that were temporarily shut down
last month through the efforts of the CPI and enforcement
officials (see ref A).


4. (SBU) Medeiros also highlighted the negative consequences

of piracy on economic development as evinced in the case of a
Toshiba factory in Brazil considering closure due to the unfair
competition from contraband and pirates. According to
Medeiros, police discovered a factory assembling Toshiba laptop
look-a-likes with used contraband computer parts, posing as a
computer repair shop. Before police could initiate an
investigation and raid, a federal judge intervened attesting to
the legitimacy of the repair shop. The CPI later discovered
that the judge in question was himself under investigation in
Operation Anaconda, a wide-ranging Federal Police corruption
investigation. More than simply a question of tax evasion, job
losses and trampled intellectual property rights, pirated,
often sub-standard, goods such as medicines and auto-parts
present a real threat to the health and safety of Brazilians,
he said.


5. (SBU) The extension of the CPI until June 2004 and the
formation of a Congressional caucus ("Frente Parlamentar" in
Portuguese) devoted to the issue of piracy and tax evasion
evidenced the strong public support of the CPI's work,
according to Medeiros. Therefore, the CPI has an obligation to
provide realistic proposals for improving the situation.
Toward that end, the CPI has maintained a very open atmosphere,
seeking input from the private sector, law enforcement
officials, and the judiciary. While the CPI has supported
public awareness campaigns, such as the Anti-Piracy Day
activities (see ref B) Medeiros told us that CPI wants to
involve the general public in formulating its report.
Depending on the availability of funding, the CPI hopes to hold
several town-hall meetings in large cities around the country
to get feedback from Brazilian citizens on how to effectively
combat piracy. He invited Emboff to participate in a working
group session with private sector representatives to be held in
Brasilia February 4. Medeiros, however, noted the absence of
contact from the Interministerial Committee to Combat Piracy
(CICP),the executive body formed by the GoB in 2001, although
he made no mention of inviting input from the CICP. He said
that the CPI would seek modifications to the CICP, but did not
elaborate further.


6. (SBU) Approximately 10 deputies on the CPI joined the
discussion, many praising the U.S. Congress's interest in their
legislative effort to address piracy. Deputy Sarney-Filho (PV-
MA),a former Minister of Environment, stressed the need for a
wider vision of the problem to include biopiracy and
trafficking in protected species. Sarney-Filho encouraged
Brazil's support for transnational legislation to address
piracy in all of its forms. Other deputies spoke of the
difficulties enforcement officials face with minimal resources,
inadequate laws (for example, the requirement for indefinite
storage of seized goods),and at times an unsupportive
judiciary. They asked for information on U.S. legislation and
procedures regarding seizures and targeted customs inspections.
Vanessa Grazziotin (PCdoB-AM) noted that China receives more
than its fair share of criticism as a supplier of pirated goods
to the world, saying other Asian and East European countries
merit investigation as well. She spoke of the difficulty
customs inspectors faced in differentiating between simply
contraband goods and pirated goods. Recognizing that poverty
plays a significant role in Brazil's piracy problem, deputies
discussed the merits of seeking ways to increase the cost of
pirated goods as well as lower the cost of legitimate products.

Comment
--------------

7. (SBU) The CPI members clearly stated their desire to
produce a useful and relevant document, and to have a long-term
impact on the Federal Government's treatment of the piracy
issue. They are cognizant of the difficulties ahead, including
the five-month timeframe in which they must complete their
work. The CPI has thus far managed to avoid becoming
politicized. Engaging the general public as fully as they have
engaged the private sector will assist in producing a balanced
set of proposals and lessen the possibility that the final
report is perceived as primarily pro-private sector to the
detriment of the larger Brazilian populace.


8. (U) The CPI is working to keep the issue in the spotlight.
Since the beginning of the year, the "Estado de Sao Paulo"
newspaper, with the country's second-largest circulation, has
published at least two articles featuring the Association for
Protection of Intellectual Property (ADEPI) and the CPI. One
editorial cited the "real possibility" of U.S.-applied
commercial sanctions against Brazil due to the country's
failure to effectively combat piracy, a reference to the GSP
review of last October. A recent RadioBras (Brazil's National
Radio) report featured the CPI and the Interministerial
Committee as two of the main fronts in the fight against
piracy, working to educate and protect the Brazilian public.
Maintaining this positive momentum after the CPI's closure will
be a challenge, an issue likely to be addressed by private
sector representatives at the February 4 working group session
with the CPI.


9. (SBU) Meeting with members of the U.S. Congress active on
piracy issues is high on the CPI's agenda, and may in part
explain their willingness to meet with us at such an
inopportune time. IPR trade associations are working to
organize a Brazilian legislators' visit to the U.S. in late
March, one aim being meetings with members of Congress's two
Piracy/IPR caucuses. Mission strongly recommends that the
Department facilitate such meetings and looks forward to
communicating details of the visit through the appropriate
point of contact in the Legislative Affairs Bureau as soon as
they are available.

HRINAK