FIRST MEETING OF U.S. - SAUDI ARABIA INTELLECTUAL

UNCLAS SECTION 01 OF 02 RIYADH 000524

SIPDIS
SENSITIVE

USTR FOR JASON BUNTIN
USDOC FOR STEVEN GARRETT

E.O. 12958: N/A
TAGS: ECON ETRD EINV KIPR SA
SUBJECT: FIRST MEETING OF U.S. - SAUDI ARABIA INTELLECTUAL
PROPERTY WORKING GROUP YIELDS POSITIVE RESULTS

REF: A. RIYADH 290

B. RIYADH 83

C. RIYADH 40

D. 2008 RIYADH 1682

E. 2007 RIYADH 2193

SENSITIVE BUT UNCLASSIFIED. NOT FOR INTERNET DISTRIBUTION.

Summary
--------------


1. (SBU) The first meeting of the U.S. - Saudi Arabia
Intellectual Property Rights (IPR) Working Group occurred
March 4-6 in Washington, DC, on the margins of the Trade and
Investment Framework Agreement (TIFA) Council Meeting
(septel). Some private rights-holders also participated in
the meetings. The creation of the Working Group was outlined
in USTR's 2008 IPR Action plan presented to the SAG in
September. Representatives from both the U.S. and Saudi
delegations welcomed the meeting as a positive development in
cooperation to increase IPR enforcement. The talks focused
heavily on IPR enforcement and government compliance with
software use. At the end of the meeting, the SAG committed
to increased transparency in IPR prosecutions and government
use of software. The Saudis additionally agreed to the
pharmaceutical Exclusive Marketing Rights Proposal (ref E)
and said a Royal Decree is forthcoming. Finally, the SAG
expressed frustration at trying to negotiate a GCC wide
data-exclusivity law. The SAG is hosting two training
seminars in conjunction with USPTO this spring. End summary.

Stakeholders discuss Saudi progress on IPR
--------------


2. (SBU) As suggested in the IPR Action Plan of 2008, the
US-Saudi Arabia IPR Working Group held its first meeting
March 4-6 in Washington, DC. Led by Mohammed al-Aiyash,
Chairman of the Saudi IPR Committee at the Ministry of
Commerce and Industry (MoCI),the Saudi delegation included
members from the Ministry of Culture and Information (MoC),
the King Abdulaziz City for Science and Technology (KACST)
and others. The U.S. delegation was made up of officials
from USTR and the Department of State. Aiyash said the SAG
hopes to improve cooperation between the public and private
sector on Saudi Arabia's IPR enforcement regime, especially
on working together on training and knowledge transfer. He
noted that all Saudi officials are willing to meet with
Emboffs and rights-holders at any time. He said the SAG
website maintained by the Violations Review Committee (VRC)
is up and running and cited the opening of a new VRC in
Jeddah as yet another step towards increased enforcement(ref
b).


3. (SBU) Eric Smith, President of the International
Intellectual Property Rights Association (IIPA) lauded the
developments in enforcement over the past year, in particular
the efforts of Deputy Minister of Culture and Information
Al-Hazzaa, and said the Ministry is sending a clear message
that transparency is critical. He also welcomed the news of
increased street raids and said he had heard of "massive
reductions" in street vending, particularly of those vendors
who approach cars at red lights and intersections. However,
he pointed out that the information on the website is
incomplete and only in Arabic, and he bemoaned the fact that
more cases are not being prosecuted to begin with, citing the
United Arab Emirate's Zero Tolerance Policy as a model in the
region. (Note: In our view, these reports of "massive
reductions" in street vending are overstated, but so is
Smith's implied allegation of widespread illegal street
vending. The sale of illegal software in Riyadh is
concentrated around the main "computer souk," sold by a
couple of dozen mainly Bangladeshi expatriates who approach
cars and pedestrians with small stacks of pirated software
titles, taken from small warehouses and production facilities
hidden above the souk's warren of computer equipment shops.
Econoffs visiting this area have found vendors increasingly
skittish from previous months, but still in business.
Western movies are sold most visibly in another single area,
with pirated and non-pirated DVDs available side by side in
the same shops. End note.)


4. (SBU) Obaidallah al-Obaidallah, Director of Copyrights
from the MoC, said the SAG is working hard and pointed to the
creation of the new VRC in Jeddah and the
soon-to-be-operational VRC in Dhahran as signs of Saudi
commitment. He said many cases of street piracy are
difficult to prosecute because the vendors have been able to

RIYADH 00000524 002 OF 002


out-run police but the MoC is currently drafting a proposal
to the Ministry of Interior to get police officers and the
Motor Vehicles Department to cooperate on IPR enforcement.
He also said that because many of the street vendors come
from South Asia, his team will receive appropriate language
training. Obaidallah expressed optimism that with increased
man-power and cooperation, enforcement will be improved.


5. (SBU) MoC participants agreed to stay in contact with IIPA
and the Embassy on continuing developments. Regarding the
website, IIPA agreed to the SAG suggestion that they fund an
independent webmaster to upload all the case information in
both Arabic and English.

Proposal to audit Saudi government computers
--------------


6. (SBU) Representatives from the Business Software Alliance
(BSA) said that they focus on ending user piracy rather than
prosecution. They described an awareness campaign to be
implemented in the coming weeks whereby they will send
letters to several hundred businesses in Riyadh, Jeddah, and
Dhahran. Microsoft representatives echoed this sentiment,
estimating that even 75-90% of Saudi government computers may
not be licensed. (Note: It is unclear what information this
estimate is based on.) Aiyash responded that the true extent
of the problem is unknown and is difficult to determine,
especially since each Ministry is independent (i.e.,
stovepiped). Microsoft representatives suggested the SAG
hire a third-party contractor to do an audit. Aiyash
responded that many of the Ministries would not allow it for
fear of privacy violations, but he offered that if the
rights-holders wished to pay, he could arrange for an audit
in his own Ministry of Commerce, as a way of setting an
example, and simultaneously send letters to all the other
Ministries reminding them of their commitments.

Pharmaceuticals and "Data Exclusivity"
--------------


7. (SBU) After many months of stalemate, the SAG delegation
agreed to the original Exclusive Marketing Rights (EMR)
Proposal first put forth by the USTR in 2007. The Ministry
of Health representative Ali Zawawi claimed a Royal Decree
will be forthcoming.


8. (SBU) The SAG delegation mentioned ongoing efforts to
negotiate a GCC-wide data exclusivity law, and a GCC-EU Free
Trade Agreement. The SAG said they are feeling caught
between conflicting demands by the United States and the EU.
Representatives from USTR offered technical assistance for
the drafting of the data exclusivity law. The delegation
also announced that in cooperation with USPTO, the SAG will
be hosting two training workshops on data-exclusivity in the
spring in Riyadh and Jeddah.


9. (U) Saudi Members of the IPR Working Group:

Abdulilah al-Suleiman, Director of the 5th Court
Board of Grievances

Mohammed al-Aiyash, Chairman of the IPR Committee
Ministry of Commerce and Industry

Mahmoud Roshdi, Director General of Commercial Licensing
Ministry of Commerce and Industry

Obaidallah al-Obaidallah, Director General of Copyrights
Ministry of Culture and Information

Khalil al-Jihani, Legal Advisor
Customs Authority

Ali Al-Zawawi, Director General of Medical Licenses and
Pharmacy
Ministry of Health

Khalid al-Aqeel, Director General for Industrial Property
King Abdulaziz City for Science and Technology
RUNDELL