POST INPUT ON SPECIAL 301

UNCLAS SECTION 01 OF 02 PRETORIA 000883

SIPDIS

SENSITIVE BUT UNCLASSIFIED

DEPT FOR EB/IPE SWILSON; AF/S KGAITHER
USDOC FOR 4510/ITA/IEP/ANESA/OA/JDIEMOND
COMMERCE ALSO FOR HVINEYARD
TREASURY FOR OWHYCHE-SHAW
DEPT PASS USPTO FOR MADLIN
DEPT PASS USTR FOR PCOLEMAN, WJACKSON, AND VESPINEL

E.O. 12958: N/A
TAGS: KIPR ETRD SF USTR
SUBJECT: POST INPUT ON SPECIAL 301

REF: (A) State 30790
(B) State 23950
(C) 2004 Pretoria 5433
(D) 2004 Pretoria 4424
(E) 2004 State 169178
(F) 204 Windhoek 905

(U) This cable is sensitive but unclassified. Not for
Internet Distribution.


1. (SBU) Summary. IIPA's comments on IPR problems in South
Africa are consistent with post's assessment on South
Africa's deficiencies in dealing with the copying of
educational texts, the shortcomings of copyright law, and
the transiting of pirated goods. Ambassador Zoellick
reiterated to SACU ministers in Walvis Bay in December that
the FTA must be comprehensive and cover IPR. The FTA
negotiation remains an important venue for pursuing a remedy
to these issues. Post, the U.S. Patent and Trademark Office,
and the Intellectual Property Action Group (IPACT) have
organized workshops on IPR issues with South African
government officials, prosecutors and magistrates. The
South Africans National Prosecuting Authority has cooperated
with these efforts by having the country's prosecutors
attend IPACT workshops on enforcement issues affecting
copyright, trademarks, and counterfeit goods. Post and
IPACT have plans to roll out the IPR workshops to South
Africa's in the next three months. End summary.


2. (SBU) Per instructions in reftel A, post has reviewed
the information submitted by the International Intellectual
Property Alliance (IIPA) identifying several countries as
"Special Mention." The information provided on South Africa
in this document is consistent with what Embassy understands
from observations and contacts with South African IPR
experts. According to a knowledgeable source, unauthorized
photocopying of educational texts on university campuses is
a serious problem that pits the publishing industry against
South African librarians. Provisions on fair use are not
settled. The IIPA comments on problems in copyright law
mirror what post has submitted for the National Trade
Estimates Report on Trade Barriers (Ref C) regarding the IPR
industry's requests for amendments that would address the
lack of criminal penalties for end user piracy, lack of
presumptions relating to copyright subsistence and
ownership, and non-deterrent civil damages. Delay on moving
this issue forward lies with DTI. The SACU FTA negotiation
remains an important venue for pursuing these issues,
particularly as a DTI official with lead responsibility on
legislative matters leads the SACU side on IPR issues.


3. (SBU) The IIPA report also raises the concern of the
South African Revenue Service (SARS) not detaining
contraband in transit. At a recent meeting of the
Intellectual Property Action (IPACT) training subcommittee,
a South African lawyer specializing in intellectual property
law similarly mentioned the need to amend South African law
in order to clarify that it does apply to pirated goods that
are passing through the country in transit, not only those
that are entering the country. Apparently a recent court
ruling suggests the Counterfeit Goods Act does not cover
goods in transit. This makes it difficult, for example, to
seize containers arriving in the port of Durban that have
goods believed to be counterfeit. Even if the companies can
get the government enforcers to intervene, it is very
expensive for the industry, which has to pay the costs for
detaining and storing the goods because of the inadequacy of
government storage depots. Moreover, the industry questions
whether the pirated goods are actually in transit; the
shipping invoice may name a different country as a
destination, but this could be fraudulent, with South Africa
being the actual place where the goods end up.

FTA
---


4. (SBU) The negotiations for a Free Trade Agreement (FTA)
with the Southern African Customs Union (SACU) began to
discuss IPR issues (a "phase two" issue) in the three rounds
held in 2004-Walvis Bay, Maseru and Atlanta. Because the
talks stalled since the June 2004 round, there has not been
an opportunity for further detailed discussion. In his
meeting with SACU ministers in Walvis Bay in December 2004
(reftel E),however, U.S. Trade Representative Ambassador
Robert Zoellick, reiterated the need for a comprehensive FTA
that covers all the issues, including IPR.

Post Efforts with USPTO and IPACT
--------------


5. (U) Post continues to work with IPACT and the U.S.
Patent and Trademark Office (USPTO) to develop programs that
raise the awareness of IPR enforcement issues. On August
23, 2004, the USPTO, IPACT and the U.S. Embassy organized
the Workshop on Enforcement of Intellectual Property Rights
in Johannesburg. The USPTO funded the event (Reftel D).
Over sixty South African government officials participated,
including representatives of the Department of Trade and
Industry (DTI),DTI's Companies and Intellectual Property
Registration Office (CIPRO),the Department of Health, the
South African Police Service (SAPS),the South African
Revenue Service (SARS),the Department of Foreign Affairs
(DFA) and the Registrar of Trade Marks and Patents.
Managers from leading U.S. pharmaceutical companies also
attended and discussed solutions to their problems with SAG
officials. USPTO Attorney Advisor Michael Adlin delivered
well-received presentations on counterfeit medicines and
effective enforcement tools against optical disc and digital
piracy. A representative of the SA Department of Health
discussed enforcement using the Medicines Control Act. A
Department of Trade and Industry (DTI) official discussed
optical disc and digital piracy. (Note: She attended the
USPTO Enforcement Academy program in October 2004 in
Virginia.) The Chairman of the Business Software Alliance
(BSA) discussed software piracy issues. The group marketing
director of Johnnic Communications spoke on the importance
of IPR enforcement for the film industry. The
Superintendent of the Computer Unit of the South African
Police Force discussed investigative techniques along with
two representatives of the South African Revenue Service.
The media also covered the event.


6. (U) IPACT organized a pilot project for over 60
prosecutors from Gauteng province (which includes the major
metropolitan areas of Pretoria and Johannesburg) on
September 21, 2004. Private sector IPR experts and
attorneys focused on South Africa's Counterfeit Goods Act,
discussed copyright and trademark enforcement issues, and
described the economic harm of pirated goods. There were
also sections on expert evidence preparation, criminal case
examples, and case study workshops. IPACT described the
event as a public private partnership. IPACT presented the
same program to South African magistrates at the Justice
College in Pretoria on November 29.


7. (U) During the next three months, Post, in conjunction
with IPACT, will sponsor this same workshop with national
prosecutors in the rest of the country: Polokwane,
Nelspruit, Blomfontein, Kimberley, Cape Town, Port Elizabeth
and Durban (the major cities in South Africa's other
provinces). South Africa's National Prosecuting Office is
coordinating this effort by directing its prosecutors to
attend.


8. (U) Post passed on the points from reftel A to officials
at DTI during the visit of Commerce DAS Holly Vineyard on
February 18.

FRAZER