Identifier
Created
Classification
Origin
06BERLIN2397
2006-08-18 14:02:00
UNCLASSIFIED
Embassy Berlin
Cable title:  

DEMARCHE ON WTO DISPUTE ON CHINA IPR: GERMANY

Tags:  KIPR ECON ETRD AORC WTRO GM 
pdf how-to read a cable
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RUEHMR RUEHPA RUEHPB RUEHRN
DE RUEHRL #2397/01 2301402
ZNR UUUUU ZZH
P 181402Z AUG 06
FM AMEMBASSY BERLIN
TO RUEHC/SECSTATE WASHDC PRIORITY 4776
INFO RUCNMEM/EU MEMBER STATES COLLECTIVE PRIORITY
RUCNFRG/FRG COLLECTIVE PRIORITY
RUCNWTO/WORLD TRADE ORGANIZATION COLLECTIVE PRIORITY
RUEHBS/USEU BRUSSELS PRIORITY
RUEHGV/USMISSION GENEVA PRIORITY 1322
UNCLAS SECTION 01 OF 02 BERLIN 002397 

SIPDIS

SIPDIS

USTR FOR POSNER (OGC),WINTER (CHINA) AND MCCOY (IPR) AND
STATE FOR EAP/CM CRANE, EB/TPP/BTA SAEGER AND EB/TPP/IPE
FELSING, USDOC FOR ISRAEL

E.O. 12958: N/A
TAGS: KIPR ECON ETRD AORC WTRO GM
SUBJECT: DEMARCHE ON WTO DISPUTE ON CHINA IPR: GERMANY
PREFERS DIALOGUE FIRST

REF: SECSTATE 126703

UNCLAS SECTION 01 OF 02 BERLIN 002397

SIPDIS

SIPDIS

USTR FOR POSNER (OGC),WINTER (CHINA) AND MCCOY (IPR) AND
STATE FOR EAP/CM CRANE, EB/TPP/BTA SAEGER AND EB/TPP/IPE
FELSING, USDOC FOR ISRAEL

E.O. 12958: N/A
TAGS: KIPR ECON ETRD AORC WTRO GM
SUBJECT: DEMARCHE ON WTO DISPUTE ON CHINA IPR: GERMANY
PREFERS DIALOGUE FIRST

REF: SECSTATE 126703


1. Embassy delivered reftel talking points to Knut Bruenjes,
Deputy Director General for Trade Policy, at the Ministry of
Economics and Technology, August 11, 2006. Bruenjes said
German officials are aware of the seriousness of the IPR
violations involving trademarks and copyrights occurring in
China, but would prefer to pursue a dialogue with China
before seeking consultations at the WTO. He said Germany
supported EU Trade Commissioner Mandelson's timeline for
dialogue with China on IPR issues until roughly the end of

2006. He said Germany would urge the Commission to prepare
for the likelihood it would have to seek recourse in the WTO
after Mandelson's timeline expires. Bruenjes agreed to put
this issue on the EU's 133 Trade Committee's agenda in the
next few weeks.


2. In response to our inquiry about concrete complaints from
German firms, Bruenjes said he would poll Germany's large
companies and industrial associations about specific IPR
violations. He noted that companies like Puma and Adidas, as
well as the Federation of German Industry (BDI) and German
International Chamber of Commerce (DIHK),could well have a
record of such incidents. Bruenjes thought such concrete
examples would help provide substance for an eventual phone
conversation on the issue between Commerce Secretary
Gutierrez and Minister Glos. He underlined the importance of
long-term U.S.-German cooperation on IPR in China, pointing
to our current common approach on automotive parts in the
WTO. Bruenjes agreed with our suggestion the DIHK-sponsored,
"2006 Hamburg Summit - China Meets Europe" in Hamburg on
September 13-15, would provide an occasion for high-ranking
German government officials to address China's IPR
enforcement policies with their Chinese counterparts (Note:
Chinese Prime Minister Wen Jiabao is expected to attend the
Summit on September 13-14, before traveling by train to
Berlin on September 14, where he will meet with Chancellor

Merkel. End Note).

-------------- --------------
Business Associations: Prefer EU's Go Slow Approach
-------------- --------------


3. Representatives from the German International Chamber of
Commerce DIHK) and the Federation of German Industry (BDI)
echoed the cautious approach of the German government on
bringing the IPR complaint before the WTO, citing the fear of
losing contracts and business opportunities in China.
According to Doris Moeller, Head of DIHK's Intellectual
Property Office and Board Member of the German Economic
Action Committee Against Product and Trademark Piracy (APM),
DIHK has received numerous complaints from German businesses
operating in China regarding IP and technology transfer
violations. She noted, however, there are few companies
willing to raise their complaints in a forum like the WTO for
fear of losing potential business in China. Moeller said
DIHK supported the EU's dialogue proposal and would prefer to
see if it brings any results before taking action at the WTO.


4. Although industry and government currently prefer a
cautious approach, Moeller noted that DIHK is taking
significant steps to systematize and document IP violations
occurring in China. Within the next two months, DIHK plans
to release a questionnaire to all its members, as well as
post it on its webpage, asking for information from companies
on specific IP violations they have experienced. To date,
information has apparently been anecdotal. The point of this
exercise is to provide the German government with concrete
examples of copyright, trademark, and technology transfer
violations that have occurred in China. Moeller promised to
share the results with us, as companies responded to the
survey.


5. Christina Rentzmann, Country Director for China at BDI,
underlined the cautious approach of German business when
addressing IP violations in China. Due to the many contracts
German companies have with the Chinese government, German
businesses are reluctant to speak out publicly on IP
violations. According to Rentzmann, German firms and their
business associations are not ready to embrace a more
aggressive approach to halting IP violations in China, i.e.
WTO consultations, and would rather allow the programs in
place, e.g. exchanges, training of judges and lawyers, to
continue. Given business' passive attitude, Rentzmann was

BERLIN 00002397 002 OF 002


skeptical about the amount of information companies would be
willing to provide DIHK on IP violations. She also noted
that German businesses and the government tended to
differentiate between technology/know-how transfer violations
and IP violations involving copyrights and trademarks in
general, and focused their efforts more on preventing the
former. That said, she agreed these issues are closely tied
together and strengthening enforcement and regulations to
prevent IP trademark violations in China would also help stop
illegal technology transfers.
KOENIG