US upgrades RP anti-piracy rating

There has been some progress in the fight against piracy.

The office of the United States Trade Representative (USTR) has lowered the Philippines from its Priority Watch List to the regular watch list under the Special 301 Review, which examines in detail the adequacy and effectiveness of intellectual property rights (IPR) protection.

The removal of the Philippines from the Priority Watch List by the USTR comes after an out-of-cycle-review (OCR) of the Philippines announced in the April 2005 Special 301 Report.

However, the Philippines remains on the regular watch list of countries that are known as production and trading areas for pirated optical discs and knockoff goods.

As this developed, President Arroyo and other government officials concerned with protecting intellectual property rights vowed to work harder to completely remove the Philippines from the US IPR watch list.

Mrs. Arroyo congratulated the Optical Media Board (OMB) headed by Edu Manzano, the Intellectual Property Coalition (IPC) under John Lesaca, and the Intellectual Property Office headed by Adrian Cristobal Jr.

These officials said they were pleased with the country’s lower ranking on the USTR list because the government’s efforts to curb piracy were not going unnoticed.

"The estimate of the business software alliance is, if we are able to reduce software piracy only by 10 percent, we will get an additional $325 million in revenues of local industry and generate 2,000 more jobs," Cristobal said.

Mrs. Arroyo said this is a good sign for investors to come in, as they could be assured that their products will be protected from piracy.

The OCR concluded in its report that, throughout 2005, the Philippines bolstered the implementation of special legislation passed to stop the illegal reproduction of copyrighted data on optical discs, such as compact discs (CDs) and digital video discs (DVDs), by controlling the licensing of companies selling such discs and conducting raids against optical disc piracy and production facilities.

Philippine law enforcers have also conducted numerous raids on retail stores selling pirated optical discs and counterfeit brand-name goods.

The government has also measurably improved the coordination of agencies responsible for the enforcement of the IPR Law.

However, the OCR also concluded that a sustained effort and continued progress on key IPR issues is essential to keeping the Philippines from sliding back down to the Priority Watch list.

The US government will be keeping a close eye on efforts by the Philippine government to further improve its IPR Law enforcement.

This information was relayed Monday night to Cristobal by the USTR office’s Southeast Asian and Pacific affairs director, David Katz.

Pursuant to Section 182 of the Trade Act of 1974, as amended by the Omnibus Trade and Competitiveness Act of 1988 and the Uruguay Round Agreements Act of 1994 under Special 301 provisions, the USTR must identify the countries that deny adequate and effective protection for IPR and equitable market access for persons that rely on intellectual property protection.

Countries that have the most onerous acts, policies or practices and whose acts, policies and practices have the greatest actual or potential adverse impact on relevant US products must be designated as "Priority Foreign Countries."

USTR created its Priority Watch List and other watch lists under the Special 301 provisions, making listed countries vulnerable to trade sanctions from the US.

Such countries face the withdrawal of voluntary concessions, such as those under the US Generalized System of Preferences (GSP).

The placement of a US trading partner on the Priority Watch List or the 301 Watch List indicates that particular problems exist in that country with respect to IPR protection, law enforcement or market access for persons relying on intellectual property.

Countries on the priority watch list are the focus of increased bilateral attention concerning IPR problem areas.

The US wants the Philippines to prosecute and convict more IPR Law violators to show its commitment to upholding intellectual property rights.

Cristobal said the US expressed the need for more prosecutions and convictions, which numbered five in 2005 and only one in 2004.

Cristobal reiterated his call for the creation of special IPR and copyright courts to handle specialized IPR and copyright cases.

He and Katz discussed the possibility of the Philippines’ removal from the USTR’s Special 301 Watch List and the OCR’s recent completion of the country’s IPR compliance.

Cristobal’s overall impression after his talk with Katz was continued optimism that the US may finally downgrade the Philippines from the special priority watch list to an ordinary watch list.

Trade Secretary Peter Favila expressed satisfaction over the removal of the country from the 301 Special Watch list on IPR.

Favila said he was informed of this by US Trade Representative Robert Portman on Wednesday morning.

He said Portman informed him that the special OCR showed there is serious commitment from the Philippines to enforce IPR protection policies.

"The US has appropriately recognized our efforts by removing us from the Priority List in view of very substantive progress, especially in enforcement activities and in special programs, such as the creation of special (IPR) courts," Favila said.

However, he added the Philippines may have been removed from the Priority List but still remains on the ordinary list.

"With the improvement in our classification, the threat of (trade) sanctions is removed and we are able to concentrate more fully on our IPR work plan," he said. "We will be relentless in our efforts and I am confident that we will be able to get entirely off the watch list soon enough."

A recent MPA report showed that its Asia-wide movie anti-piracy crackdown dubbed "Operation Big Broom" netted 5.7 million pirated discs during the last week of 2005.

"Big Broom," launched on Dec. 25 until New Year on retail shops, markets and street vendors, also resulted in the arrest of 807 people in over 12 countries in the Asia-Pacific Rim, including the Philippines.

The top five producers of pirated optical discs were Indonesia where 2,362,000 fake VCDs and DVDs and 27 DVD-R burners were seized; the Philippines, with 1,276,625 fake VCDs and DVDs; China with 1,014,478 illegal optical discs; Malaysia with 504,258 pirated optical discs; and Taiwan with 230,117 pirated optical discs seized by "Big Broom" operatives in the crackdown.

Operation Big Broom has been focusing its efforts on addressing the piracy problem in the so-called "black spots" of major cities in the Philippines, Australia, China, Hong Kong, India, Indonesia, Japan, Malaysia, New Zealand, Singapore, South Korea, Taiwan and Thailand. — With Aurea Calica