AMBASSADOR CONVEYS IPR CONCERNS TO NORWEGIAN TRADE

UNCLAS OSLO 000492

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SENSITIVE
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DOC FOR 4212 MAC/EUR/OEURA
STATE PLS PASS TO USTR FOR JASON BUNTIN

E.O. 12958: N/A
TAGS: ETRD ECON KIPR NO
SUBJECT: AMBASSADOR CONVEYS IPR CONCERNS TO NORWEGIAN TRADE
MINISTER

REF: A) OSLO 449 B) STATE 56556 C) 2006 OSLO 811


1. (SBU) Summary: On May 4, the Ambassador discussed
intellectual property right problems in Norway
with Minister of Trade and Industry Dag Terje Andersen.
Topping the list was Norway's weak system of patent
protections for pharmaceuticals, the focus of recent
high-level letters from U.S. officials and the industry's
Special 301 complaint against Norway. Ministry officials
defended Norway's IPR system and, with respect to the
pharmaceutical patent matter, passed the buck to the Health
Ministry. End summary.

Norway's Strengths and Weaknesses
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2. (SBU) The Ambassador met on May 4 with Norwegian Minister
of Trade and Industry Dag Terje Andersen to discuss economic
innovation and intellectual property rights issues, including
Norway's weak patent protections for pharmaceuticals (refs A.
B). The Ambassador described his recent trade promotion
visit to the United States, telling Andersen that American
venture capitalists were well aware of technological
innovation in Norway and counted among the economy's
strengths its educated work force transparency and low
corruption, and such cultural similarities as
straightforwardness in business dealings. On the other hand,
American venture capitalists expressed two major concerns
about Norway -- that it lacked strong, highly motivated
entrepreneurs and that it did not appear committed to
protecting intellectual property rights.

Serious IPR Deficiencies
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3. (SBU) The Ambassador stressed the importance of strong
IPR protections to Norway's reputation as a good place to do
business. The Ambassador pointed out a number of serious IPR
problems in Norway, including the lack of injunctive relief
against internet pirates, overly broad "private use"
exceptions to copyright protections, excluding U.S. artists
from the government's copyright compensation fund, attacks on
Apple iTunes' business model for allegedly violating
consumers' rights (ref C),no customs authority to seize
counterfeit goods at the border, and weak patent protections
for pharmaceuticals.


4. (SBU) The Ambassador noted that the pharmaceutical patent
issue was attracting more high-level attention in Washington,
citing the recent discussion of Norway's possible inclusion
on USTR's "Special 301" list (refs A. B) and letters from
Senator Lugar to Foreign Minister Stoere and from Commerce
Under Secretary Lavin to Andersen. He added that poor patent
protections were hurting Norway as well, in lost jobs and
potential investment. Local managers of American
pharmaceutical companies report that their ability to draw
company resources to Norway is diminishing because of the
patent problem. The Ambassador concluded that this
continuing commercial irritant was not good for our bilateral
relationship and hampered his ability to attract new U.S.
business to Norway.


5. (SBU) Andersen replied that the Health Ministry is the
lead decision-maker on the pharmaceutical patent issue and
that he gave U/S Lavin's letter to the Health Minister for
action. (Note: During a recent courtesy call on the Health
Minister, the Minister told the Ambassador to take the issue
up with the Trade Minister. In Post's experience, this
"passing the buck" on trade and commercial irritants is
common. End note.) Andersen noted his ministry was also
very interested in IPR issues, however, and that spurring
innovation is one of its top current priorities. The
Ambassador and Andersen discussed a possible visit by
American venture capitalists to support the Ministry's
efforts.


6. (SBU) With respect to broader IPR issues, the Ministry's
Secretary General, Per Sanderud, took up the defense.

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Sanderud claimed that Norwegian legislation is working well
and meets all Trade-Related Aspects of Intellectual Property
Agreement obligations. He noted that Norway would join the
European Patent Convention this year and was working on
legislation to grant customs authorities power to seize
pirated goods. He called the action against Apple iTunes "an
issue of ownership," i.e. ensuring the ability to play
downloaded music on a variety of devices, rather than an IPR
issue, and (in another instance of buck passing) said the

Consumer Ombudsman, not the Trade Ministry, is the
responsible agency.


7. (SBU) Andersen said Norway was also experiencing IPR
problems, e.g. with China stealing its proprietary ship
building technology and manufacturing knock-offs of high-end
Ekornes furniture. He urged that the U.S. and Norway work
together to strengthen IPR protections in China, India and
other emerging markets.

Comment: No Giving Up
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8. (SBU) The basic point that the Ambassador has conveyed to
senior Norwegian officials with whom he has discussed the
pharmaceutical patent issue is, "We're not giving up."
Neither are the local offices of American and other foreign
pharmaceutical firms, nor their home offices. The U.S. firms
are lobbying harder on the issue in Washington, resulting in
the two recent letters from Senator Lugar and Commerce Under
Secretary Lavin on the issue. The Embassy recently hosted a

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meeting of representatives of other missions whose companies
are affected, including the U.K, Switzerland, Denmark, the
EC, and others. Some, like the U.K. and Swiss, favor
continuing to press the issue. The French are on the fence
but increasingly concerned, the others hesitant. Interest in
the issue is rising in many quarters, however, guaranteeing a
lively year ahead.
WHITNEY