09.11.11

Cablegate: “The Free Software Movement is Building Support Within the Government of Brazil and Throughout Brazil”

Posted in America, Cablegate, Free/Libre Software at 3:12 am by Dr. Roy Schestowitz

Cablegate

Summary: The Government of Brazil (GoB) comes under US pressure and the increased adoption of Free software in the country is also being mentioned

TODAY’s coverage of Brazil contains several “Sensitive” Cablegate cables. It is more of the same colonisation effort.

Argentina was put on the "watch list" as part of the attempt to change the laws there, making the country more receptive towards foreign monopolies. “Post recommends that Brazil remain on the Priority Watch List for the 2004 Special 301 Review,” says the first cable that we present today, demonstrating the same approach of shame lists or the targeting of nations that step ‘out of line’. “Lula administration has not yet developed a comprehensive national strategy for addressing the country’s poor IPR enforcement, nor has it reduced the backlog of patent and trademark applications,” complain the diplomats.

So?

Does a government become “bad” for not providing patent monopolies?

As the cables show, the US is trying to help Brazil change. A cable says that “Monteiro is most proud of the IPR introductory training course now required at the federal police academy and hopes to duplicate the success of this program in all police training curricula (civil and military).”

Further down there is a section titled “Patents – Talk but Little Action”.

Recall what was done in Brazil for OOXML. The "IPR" card was being used to daemonise ODF, as cables revealed years after the act. Microsoft called it an “attack” on IPR.

The cable below speaks about copyrights as well, later on with a rant about “TRIPS Compliance and Related Issues” (we wrote about TRIPS before [1, 2, 3, 4]).

See ¶6 which says: “In July 2003 President Lula signed a law amending the Brazilian criminal code with respect to copyright violations (ref L). The law increases the minimum penalty from one to two years’ imprisonment, levies a fine and allows for improved seizure and destructions procedures for contraband. The law does not include increased sanctions for software infringement. The free software movement is building support within the GoB and throughout Brazil. GoB procurement regulations prohibit use of unlicensed software, according to Itamaraty officials, but no special decrees or directives exist to further encourage compliance with international standards of copyright protection.”

And ¶11 says: “In January 2004, Monsanto announced that it had reached an agreement with farmers from the Brazilian state of Rio Grande do Sul to receive remuneration for the use of Roundup Ready technology found in the company’s soybean variety grown widely throughout the state. The GoB’s position on biotechnology remains undecided, as the biotechnology bill is still under debate in Congress (ref D).”

Here goes the first cable.


UNCLAS SECTION 01 OF 03 BRASILIA 000445 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR WHA/BSC AND EB/IPC WILSON 
COMMERCE FOR KSCHLEGELMILCH 
PLS PASS USTR BPECK, USPTO JURBAN/DLASHLEY-JOHNSON, 
AND LOC STEPP 
 
E.O. 12958: N/A 
TAGS: KIPR [Intellectual Property Rights], ECON [Economic Conditions], 
ETRD [Foreign Trade], KCRM [Criminal Activity], 
PGOV [Internal Governmental Affairs], BR [Brazil], 
IPR & Biotech 
SUBJECT:  BRAZIL - 2004 SPECIAL 301 RESPONSE 
 
Refs:  A) State 29549 B) Sao Paulo 276  C)  Rio de Janeiro 128 
D) Brasilia 313 E) Brasilia 222 F) Brasilia 202 G) 2003 Sao 
Paulo 2199  H) 2003 Brasilia 3868 I) 2003 Brasilia 3138 J) 2003 
Brasilia 3122 K) 2003 Brasilia 2943 L) 2003 Sao Paulo 1186 
 
SENSITIVE BUT UNCLASSIFIED, PROTECT ACCORDINGLY. 
 
¶1. (SBU) Summary:  Post recommends that Brazil remain on the 
Priority Watch List for the 2004 Special 301 Review.  Despite 
several positive developments, including tougher penalties for 
copyright infractions and increased (but isolated) police 
action against copyright theft, the Lula administration has not 
yet developed a comprehensive national strategy for addressing 
the country's poor IPR enforcement, nor has it reduced the 
backlog of patent and trademark applications.  Several signs 
suggest that substantial progress is in the offing, but to date 
there has been little concrete improvement in Brazil's 
enforcement record.  Widespread recognition of the harm caused 
by IPR abuse to Brazilian artists, tax revenues, and 
technological progress/industrial development has increased, 
due in part to successful public awareness campaigns launched 
by both the private and public sectors.  The federal government 
has incorporated intellectual property regime improvements in 
its 2004-2007 Pluriannual Plan, and the formation of a 
Commission of Parliamentary Inquiry (CPI) and a permanent 
Caucus (Frente Parlamentar) on the issue of piracy and tax 
evasion in Brazil's Congress has generated much positive 
momentum. Leaving unaltered Brazil's Special 301 status while 
recognizing the progress it has made would send the clear 
signal that its continued poor IPR enforcement is a significant 
bilateral concern, but not damage the efforts of those within 
Brazil who seek tangible improvement.  End summary. 
 
Copyright Piracy - Positive Strides But Piracy Still Rampant 
 
¶2. (SBU) Several of the industry Special 301 submissions 
welcome the increased interest in piracy and tax evasion 
generated in the Brazilian Congress in 2003.  The Chamber of 
Deputies' Piracy CPI and the spin-off permanent Caucus may well 
represent the best hope for national-level action to improve 
copyright enforcement.  As IIPA's submission suggests, the 
CPI's final report due in June will include several private 
sector generated action proposals for the federal government 
that should substantially remedy the lack of concrete 
coordinated action against piracy.  While the issue gains 
prominence, the crime continues unabated.  Special piracy task 
forces or police units in some Brazilian states and 
municipalities have produced enforcement successes and worked 
cooperatively with the CPI to make some high-profile arrests 
(refs E, G, H, I, K).  These encouraging but isolated foci of 
activity are not coordinated and exist despite the 
Administration's failure to formulate a national strategy. 
 
¶3. (SBU) The administration's Inter-ministerial Committee to 
Fight Piracy (IMC) met 11 times during its first year under the 
leadership of former federal police official Clovis Monteiro da 
Silva, but was bogged down in the bureaucracy of transition to 
the new Lula administration for much of the first half of 2003. 
Residing in the Ministry of Justice, the IMC continues to 
disappoint most with its lack of vision in addressing the fight 
against piracy.  One member of the committee told econoff 
recently that the IMC has lots of great ideas but no authority 
or resources to implement them.  Monteiro notes that the IMC 
still suffers from insufficient funds to accomplish its 
mission, and some ambitious 2003 plans, such as a Mercosul IPR 
conference, had to be postponed. 
 
¶4. (SBU) Ref B notes Brazil-based industry representatives' 
assessment of the IMC as largely ineffective, but several of 
the committee's actions in 2003 deserve mention.  Monteiro is 
most proud of the IPR introductory training course now required 
at the federal police academy and hopes to duplicate the 
success of this program in all police training curricula (civil 
and military).  The public awareness campaign initiated in 2003 
with radio, billboards and isolated television spots in a few 
cities will be expanded nationwide to include anti-piracy movie 
trailers.  Monteiro insists that the educating role of the IMC 
is significantly undervalued, and that in the long-term, this 
effort will reduce piracy.  He admits that the IMC would gain 
from improved self-promotion and publicity to inform the 
interested public of its activities and accomplishments. 
According to Monteiro, the Committee's role of coordinating 
action within the Federal government, including with the police 
and customs officials where true enforcement takes place, is 
difficult to appreciate, but he believes that the growing 
recognition of the scope of Brazil's piracy problem is due to 
the quiet, consistent work of the Committee.  There wouldn't be 
a CPI on piracy if the IMC did not exist, he told econoff. 
 
¶5. (SBU) The IMC and the Federal Police are developing a 
database of piracy actions that will be accessible by federal, 
state civil and military police.  This effort entails modifying 
an existing crime database to include crimes related to piracy. 
The IMC has not yet finalized its 2004 action plan, which is to 
be included in the National Public Security Plan, but held its 
first meeting of the year on February 19.  Monteiro plans to 
focus on widening the public awareness campaign and 
strengthening ties within Mercosul and with WIPO.  The IMC will 
also be studying changes to the legislation that created the 
Committee to strengthen its powers and expand its jurisdiction. 
Contrasted with the CPI's warm and cooperative relationship 
with the private sector, the IMC appears to regard the industry 
associations with a certain suspicion, particularly concerning 
industry statistics on damages caused by piracy -- which the 
IMC maintains are not credible.  The IMC is working on 
developing its own statistics and studying the economic impacts 
of the creation and theft of intellectual property.  With the 
start of the CPI, the private sector's involvement with the IMC 
has waned, but the IMC invited private associations to 
participate in several 2003 meetings, according to Monteiro. 
 
¶6. (SBU) In July 2003 President Lula signed a law amending 
the Brazilian criminal code with respect to copyright 
violations (ref L).  The law increases the minimum penalty 
from one to two years' imprisonment, levies a fine and 
allows for improved seizure and destructions procedures for 
contraband.  The law does not include increased sanctions 
for software infringement.  The free software movement is 
building support within the GoB and throughout Brazil.  GoB 
procurement regulations prohibit use of unlicensed software, 
according to Itamaraty officials, but no special decrees or 
directives exist to further encourage compliance with 
international standards of copyright protection. 
 
Patents - Talk but Little Action 
 
¶7. (SBU) As ref C illustrates, Brazil's difficulties in 
granting patents and trademarks continues to worsen, as INPI 
lacks much needed resources and the involvement of the Ministry 
of Health's Sanitary Vigilance Agency (ANVISA) in 
pharmaceutical patents become more pronounced.  INPI's Patent 
Director estimates the current patent backlog at 50,000. 
PhRMA's estimate of 450,000 pending trademark applications 
strikes us as reasonable.  The administration's industrial 
policy goals, focusing on improving the technological base of 
Brazilian industry with special emphasis on software and 
pharmaceutical industries, put INPI in the spotlight.  The 2004- 
07 Pluriannual Plan fixes the objective of reducing processing 
time for patents from seven to four years and for trademarks 
from four to one year. 
 
¶8. (SBU) There appears to be recognition within the 
administration that the INPI/ANVISA linkage with regard to 
patent approval for pharmaceutical products or processes has 
taken on negative dimensions, but no remedies have been 
proposed (refs C and F).  INPI's staffing woes should be 
ameliorated somewhat this year with the addition of 108 
positions now available to qualified civil servants, and 
officials from the Ministry of Development Industry and Foreign 
Trade (MDIC) expect a permanent President of INPI to be named 
shortly. 
 
TRIPS Compliance and Related Issues 
 
¶9. (SBU) Presidential Decree 4370/03 amends existing patent 
legislation regarding compulsory licensing in situations of 
national emergency or public interest.  The GoB quickly 
instituted the measure after the August 30 WTO Access to 
Medicines Agreement while in the midst of price negotiations 
with several pharmaceutical companies regarding medicines for 
its world-renowned HIV/AIDS treatment program.  The measure has 
not been invoked, and its TRIPS compliance is uncertain (ref 
J).  Legislation pertaining to designs for integrated circuits 
(Bill 1787/96) remains pending in Congress; Itamaraty officials 
have repeatedly requested priority action on the bill, to no 
avail. 
¶10. (SBU) Previous Brazilian legislation dealing with 
aspects of genetic "patrimony" or heritage related to 
biodiversity conservation, integrity of genetic patrimony 
and traditional knowledge was superceded by the issuance of 
Provisional Measure 2.186 of August 23, 2001, which together 
with Decree 3.945 of 2001 and subsequent regulations, 
subject access and transfer of genetic patrimony to the 
approval of the Genetic Heritage Management Council (GHMC) - 
- a body composed of several ministries, academics, and 
others which is directed by the Ministry of Environment -- 
and to the sharing of benefits in contractual terms and 
legally established conditions.  New draft legislation on 
genetic patrimony, which would replace the Provisional 
Measure and subsequent regulations, is reportedly under 
consideration in the Brazilian Executive Branch, and could 
be introduced in the Brazilian Congress later this year. 
 
Biotechnology 
 
¶11. (SBU) In January 2004, Monsanto announced that it had 
reached an agreement with farmers from the Brazilian state of 
Rio Grande do Sul to receive remuneration for the use of 
Roundup Ready technology found in the company's soybean variety 
grown widely throughout the state.  The GoB's position on 
biotechnology remains undecided, as the biotechnology bill is 
still under debate in Congress (ref D). 
 
¶12. (SBU) Itamaraty confirms that the GOB has no plans to 
ratify the 1996 WIPO Copyright treaty or the WIPO Performances 
and Phonograms Treaty. 
 
Recommendation 
 
¶13. (SBU) Despite positive strides in some sectors, post 
believes that the continued lack of tangible improvements in 
IPR protection and enforcement as a whole in the last year 
manifestly precludes lowering Brazil's Special 301 status. 
However, we recognize a positive momentum that should bear 
fruit this year, with projects in the pipeline such as the 
CPI's final report and INPI's increased staffing.  We concur 
with industry submissions that suggest that retaining Brazil 
as a Priority Watch List country will appropriately convey 
the importance of the issue in our bilateral relationship, 
and believe that this position would not unduly discourage 
the forces of positive change within Brazil.  To ensure that 
we can use the announcement to promote further progress we 
request that, should Brazil's status be maintained, USTR's 
announcement clearly recognize the positive developments 
regarding IPR that did occur and the USG's desire to work 
collaboratively to produce tangible results in the coming 
year. 
 
HRINAK


So they are restricting access to drugs, shaming Brazil, and using WTO/WIPO to apply some sorts of sanctions or other pressure instruments for Brazil to accept the US law and permit them to rule the nation.

In another cable, one titled “WTO Services Negotiations: Request For Comments On U.S. Market Access Priorities,” it is being claimed that “Open Source Software is being adopted by the Brazilian government.” Here it is in full:


UNCLAS SECTION 01 OF 03 BRASILIA 000128 
 
SIPDIS 
 
STATE PLEASE PASS TO USTR/CHOOKER 
GENEVA PASS USTR/AGREENIDGE 
USDOC FOR 3134/USFCS/OIO/WH/EOLSON 
USDOC FOR 4332/ITA/MAC/WH/OLAC/MWARD 
 
E.O. 12958: N/A 
TAGS: ETRD [Foreign Trade], BR [Brazil], 
WTO [World Tourism Organization], Trade 
SUBJECT:  WTO SERVICES NEGOTIATIONS: REQUEST FOR COMMENTS 
ON U.S. MARKET ACCESS PRIORITIES 
 
REF:  04 STATE 270998 
 
¶1. This cable is based upon input provided by FCS Sao 
Paulo. 
 
¶2. Per reftel request, below is a ranking of the various 
service sectors in terms of priority for the USG and 
level of openness.  Where appropriate, we have included 
comments regarding doing business issues for a specific 
sector. 
 
¶3. Begin text. 
 
SECTOR                      PRIORITY   LEVEL OF 
                              LEVEL    OPENNESS 
------------------------    --------   -------- 
 
LEGAL SERVICES                  3        MEDIUM 
COMMENT: FOREIGN COMPANIES CAN OPERATE THROUGH 
PARTNERSHIP WITH LOCAL FIRMS OR BY ESTABLISHING AN OFFICE 
IN THE COUNTRY AND HIRING LOCAL ATTORNEYS.  FOREIGN 
PROFESSIONALS CANNOT PRACTICE IN BRAZIL DIRECTLY. 
 
ACCOUNTING, AUDITING AND        5        LOW 
 BOOKKEEPING SERVICES 
COMMENT: ONLY LOCAL ACCOUNTANTS REGISTERED AT THE 
ACCOUNTANTS' COUNCIL CAN PROVIDE SERVICES. THE BRAZILIAN 
BOOKKEEPING SYSTEM IS SLIGHTLY DIFFERENT FROM THAT OF THE 
U.S. 
 
ARCHITECTURAL SERVICES          5        LOW 
COMMENT: FOREIGN ARCHITECTS MUST HAVE THEIR DEGREES 
VALIDATED IN BRAZIL.  THE PROCESS IS VERY COMPLICATED AND 
TAKES A LONG TIME. 
 
ENGINEERING AND INTEGRATED      3        MEDIUM 
 ENGINEERING SERVICES 
COMMENT: FOREIGN FIRMS ARE REQUIRED TO HAVE A LOCAL 
REPRESENTATIVE WHO HOLDS A LICENSE TO PRACTICE 
ENGINEERING IN THE COUNTRY, AND THE COMPANY HAS TO BE 
REGISTERED AS AN ENGINEERING FIRM IN BRAZIL. 
 
URBAN PLANNING AND LANDSCAPE    5        LOW 
 ARCHITECTURAL SERVICES 
COMMENT: FOREIGN ARCHITECTS MUST HAVE THEIR DEGREES 
VALIDATED IN BRAZIL.  THE PROCESS IS VERY COMPLICATED AND 
TAKES A LONG TIME. 
 
COMPUTER AND RELATED SERVICES   3        MEDIUM 
Comment: Computer and peripherals are manufactured in 
Brazil.  (One example is Dell Computers.) Almost all 
electronic components used in the industry are imported. 
However, used computers and peripherals cannot be 
exported to Brazil.  Open Source Software is being 
adopted by the Brazilian government.  Brazil is set to 
adopt a digital TV standard in the near future. 
 
RESEARCH AND DEVELOPMENT        1        HIGH 
 SERVICES 
 
REAL ESTATE SERVICES            3        MEDIUM 
COMMENT: FOREIGN COMPANIES CAN OPERATE THROUGH 
PARTNERSHIP WITH LOCAL FIRMS OR BY ESTABLISHING AN OFFICE 
IN THE COUNTRY. 
 
RENTAL/LEASING SERVICES         3        HIGH 
 
ADVERTISING SERVICES            5        HIGH 
 
MARKET RESEARCH AND PUBLIC    N/A 
 OPINION, POLLING SERVICES 
 
MANAGEMENT CONSULTING SERVICES  1        HIGH 
COMMENT: IN CASES INVOLVING THE TRANSFER OF TECHNOLOGY, 
THERE IS A LENGTHY REGISTRATION PROCESS AT INPI - THE 
BRAZILIAN INSTITUTE OF INTELLECTUAL PROPERTY.  IN 
ADDITION, ALL IMPORTS OF SERVICES ARE SUBJECT TO THE 
FOLLOWING TAXES/FEES: IRRF - INCOME TAX: 15%, CIDE - 
CONTRIBUTION TO THE ECONOMIC INTERVENTION DOMAIN: 10%, 
ISS - MUNICIPAL SERVICES TAX: 5%, AND PIS/COFINS - SOCIAL 
INTEGRATION AND SOCIAL SECURITY FINANCING CONTRIBUTIONS: 
9.25%. 
TECHNICAL TESTING AND           3        MEDIUM 
 ANALYSIS SERVICES 
SERVICES INCIDENTAL TO          1        MEDIUM 
 AGRICULTURE, HUNTING AND 
 FORESTRY, AND FISHING 
 
SERVICES INCIDENTAL TO MINING   3        MEDIUM 
COMMENT: POTENTIAL ONLY FOR FRONT-END ENGINEERING 
STUDIES, SUCH AS MINERAL PROCESS ADVANCED CONTROL 
SYSTEMS.  IN GENERAL, FOREIGN SUPPLIERS MUST WORK IN 
CONSORTIUM WITH LOCAL COMPANIES, BOTH TO LOWER COSTS AND 
TAP LOCAL EXPERTISE. 
 
ENERGY SERVICES                 1        HIGH 
COMMENT:  ELECTRICAL POWER DISTRIBUTION AND OIL AND GAS 
SERVICES TAKE PLACE IN BRAZIL PURSUANT TO A CONCESSION 
REGIME ADMINISTERED BY THE BRAZILIAN GOVERNMENT.  THESE 
SERVICES ARE EQUALLY OPEN TO DOMESTIC AND FOREIGN 
COMPANIES.  THE PRINCIPAL DIFFICULTY FACED BY U.S. FIRMS 
IN THESE MARKET SEGMENTS IS NOT MARKET ACCESS, BUT 
INADEQUATE CONTRACT STABILITY, DELAYS IN OBTAINING 
ENVIRONMENTAL PERMITS, AN UNSTABLE REGULATORY SYSTEM 
(ESPECIALLY IN THE POWER SECTOR), AND THE NEED TO MEET 
LOCAL EQUIPMENT REQUIREMENTS.  HOWEVER, ALL OF THESE 
ISSUES EQUALLY AFFECT DOMESTIC AND FOREIGN COMPANIES 
OPERATING IN BRAZIL. 
 
PLACEMENT AND SUPPLY SERVICES   4        HIGH 
 OF PERSONNEL 
 
INVESTIGATION AND SECURITY      3        MEDIUM 
 
RELATED SCIENTIFIC AND          1        HIGH 
 TECH CONSULTING SERVICES 
COMMENT: IN CASES INVOLVING TRANSFER OF TECHNOLOGY, THERE 
IS A LENGTHY REGISTRATION PROCESS AT INPI - THE BRAZILIAN 
INSTITUTE OF INTELLECTUAL PROPERTY. 
 
MAINTENANCE AND REPAIR OF       5        HIGH 
EQUIPMENT 
 
BUILDING/CLEANING SERVICES      5        HIGH 
 
PHOTOGRAPHIC SERVICES           5        HIGH 
 
PACKAGING SERVICES              2        MEDIUM 
 
PRINTING, PUBLISHING            2        MEDIUM 
 
CONVENTION SERVICES             2        HIGH 
 
COURIER SERVICES                1        MEDIUM 
 (EXPRESS DELIVERY) 
 
TELECOMMUNICATION SERVICES      1        MEDIUM 
 
AUDIOVISUAL SERVICES    N/A 
 
CONSTRUCTION AND RELATED        3        MEDIUM 
 ENGINEERING 
COMMENT: FOREIGN FIRMS ARE REQUIRED TO HAVE A LOCAL 
REPRESENTATIVE WHO HOLDS A LICENSE TO PRACTICE 
ENGINEERING IN THE COUNTRY, AND THE COMPANY HAS TO BE 
REGISTERED AS AN ENGINEERING FIRM IN BRAZIL. 
 
DISTRIBUTION SERVICES           1        HIGH 
 
ENVIRONMENTAL SERVICES          3        MEDIUM 
COMMENT: THE MARKET IS RELATIVELY SMALL BUT EXPANDING, 
PARTICULARLY IN THE REMEDIATION AND CLEAN UP OF 
CONTAMINATED SITES BUSINESS.  U.S. COMPANIES USUALLY 
ASSOCIATE WITH LOCAL ENVIRONMENTAL COMPANIES FOR THE 
DEVELOPMENT OF SPECIFIC PROJECTS. 
 
BANKING AND OTHER FINANCIAL     4        HIGH 
 SERVICES INCLUDING SECURITIES 
 
Comment: Brazil's Central Bank regulates banking and 
financial services, and maintains strict accounting and 
operational supervision.  Private pension funds are among 
the fastest growing sectors of the Brazilian economy, and 
consists of open funds (including those similar to U.S. 
401(k) plans) and closed funds. 
 
INSURANCE SERVICES              4        HIGH 
Comment: U.S companies wishing to enter into the 
Brazilian insurance market are advised to do so through a 
joint venture, acquisition or partnership with a local 
company, or to open a subsidiary.  Under current 
legislation, insurance companies must be organized as 
corporations (Sociedade Anonima, or S/A), and submit to 
local regulatory authorities an application to operate as 
an insurance company. The insurance company may not 
engage in activities other than insurance. These same 
rules apply to reinsurance companies, though their scope 
for action is limited by the existence of a government 
monopoly reinsurer, the Brazilian Reinsurance Institute 
(IRB).  Foreign firms currently are barred from offering 
reinsurance on their own account, but may conduct 
business with the IRB. Foreign insurance companies may 
establish a representative office in Brazil, but are not 
allowed to engage in certain insurance activities, such 
as issuing policies.  Current legislation allows foreign 
insurance companies to hold the entire equity 
participation or voting stock of a Brazilian insurance 
company. 
 
End Text. 
 
CHICOLA


In the following cable, it is said that “China will remain one of Brazil’s more important commercial partners for the foreseeable future, not only as a market for its primary commodities, but also as source of infrastructure investment and collaboration in certain technology-related areas, including satellites and development of open-source software.”



UNCLAS SECTION 01 OF 03 BRASILIA 000128 
 
SIPDIS 
 
STATE PLEASE PASS TO USTR/CHOOKER 
GENEVA PASS USTR/AGREENIDGE 
USDOC FOR 3134/USFCS/OIO/WH/EOLSON 
USDOC FOR 4332/ITA/MAC/WH/OLAC/MWARD 
 
E.O. 12958: N/A 
TAGS: ETRD [Foreign Trade], BR [Brazil], WTO [World Tourism Organization], Trade 
SUBJECT:  WTO SERVICES NEGOTIATIONS: REQUEST FOR COMMENTS 
ON U.S. MARKET ACCESS PRIORITIES 
 
REF:  04 STATE 270998 
 
¶1. This cable is based upon input provided by FCS Sao 
Paulo. 
 
¶2. Per reftel request, below is a ranking of the various 
service sectors in terms of priority for the USG and 
level of openness.  Where appropriate, we have included 
comments regarding doing business issues for a specific 
sector. 
 
¶3. Begin text. UNCLAS SECTION 01 OF 05 BRASILIA 000212 
 
SIPDIS 
 
SENSITIVE 
 
STATE PLEASE PASS TO USTR FOR SCRONIN, KLEZNY 
NSC FOR MIKE DEMPSEY 
DEPT OF TREASURY FOR FPARODI 
USDOC FOR 3134/USFCS/OIO/WH/DDEVITO/DANDERSON/EOLSON 
USDOC FOR 4332/ITA/MAC/WH/OLAC/JANDERSEN/ADRISCOLL/MWAR D 
USDA FOR JB PENN, U/S, FFAS 
 
E.O. 12958: N/A 
TAGS: ETRD [Foreign Trade], BR [Brazil], WTRO [World Trade Organization], Trade 
SUBJECT: BRAZIL'S 2005 TRADE AGENDA: MORE OF THE SAME 
 
REF: A) BRASILIA 94 B) SAO PAULO 89 C) 04 BRASILIA 
 
     3100 D) 04 BRASILIA 2882 E) 04 SAO PAULO 1659 
 
¶1.   (U)  This cable has been coordinated with AmConsulate 
Sao Paulo. 
 
¶2.  (SBU)  Summary and Introduction.  Changing the "geography 
of trade" has become a Lula administration hallmark.  Over 
the past two years, the GoB has aggressively used Brazilian 
and Mercosul trade policy to strengthen economic and 
political ties with other developing countries, in part to 
diversify Brazil's export markets, but more pointedly to 
develop strategic partnerships with countries that can help 
Brazil realize various geopolitical objectives.  Private 
sector critics claim the GoB's focus on developing country 
partners has diverted its attention from securing more 
lucrative economic opportunities through trade agreements 
with the EU or with the United States (See Ref A). 
Dissension within the government over trade policy is also 
still evident with Ministers Furlan (Development and Trade) 
and Rodrigues (Agriculture), who support the private sector 
perspective, at odds with the Foreign Ministry, whose trade 
strategy continues to enjoy the backing of President Lula. 
Recent criticism of GoB trade policy by Minister Furlan 
prompted a rebuttal by President Lula on January 18 in which 
he justified a continuation of current policy in order to 
further reduce the "dependence" of Brazil on the EU and the 
United States.  While there is widespread domestic support 
for the priority the GoB has assigned to the global WTO trade 
negotiations, substantial benefits from the Doha Round are 
only expected over the long-term.   A brief overview of 
Brazil's trade agenda for 2005 is presented below.  End 
Summary and Introduction. 
 
WTO - Doha Development Agenda 
 
¶3.   (SBU) In public comments laying out GoB trade priorities 
for the coming year, Foreign Minister Amorim has stated 
explicitly that the WTO Doha Round is Brazil's top priority. 
In Amorim's view, the Doha Round represents an opportunity 
for Brazil to press for elimination or reduction of the worst 
trade distorting practices affecting global agricultural 
trade -- the key demand for Brazil given that agriculture 
accounted for about 42 percent of its exports, 34 percent of 
its GDP, and 37 percent of its employment in 2004. 
 
¶4.   (SBU)  In the WTO, the GoB will continue to actively 
utilize its strategic partnerships with other developing 
countries.  The GoB is expected to maintain an assertive 
stance in Geneva on agriculture reform; Brazil's sometimes 
strident leadership of the G-20, even the failure of the 
Cancun Ministerial in 2003, are seen here as having paid off 
in Brazil's inclusion in the Five Interested Parties (FIPs) 
process and in the eventual substance of the July negotiating 
framework package. 
 
¶5.   (SBU)  Amorim has acknowledged that negotiations on 
market access for industrial products and services must also 
proceed for a final package to emerge, suggesting that Brazil 
may negotiate on these issues as part of strategic coalitions 
formed around specific issues.  He has also warned that 
Brazil's posture in these and other areas may not always be 
defensive, pointing to GoB formulation of proposals relating 
to export credits and investment (local content 
requirements).  According to Ambassador Clodoaldo Hugueney, 
Brazil's top WTO negotiator, the GoB hopes the Doha 
negotiations can be wrapped up before the 2007 expiration of 
an extended TPA either undermines an ambitious outcome or 
causes an indeterminate delay in concluding the Round (Ref 
C).   (Note: Hugueney will soon be leaving his current post 
to replace Luiz Felipe de Seixas Correa as Ambassador to the 
WTO.)  While the nomination of Seixas Correa as WTO Director 
General may have been largely prompted by Brazil's interest 
in spoiling the candidacy of Uruguayan Carlos Perez del 
Castillo, the GoB would relish having a Brazilian diplomat in 
this key position during the final phase of the negotiations. 
 
Mercosul-EU 
¶6.   (SBU) Amorim continues to list free trade talks with the 
European Union as a GoB priority.  The EU is Brazil's largest 
export market, absorbing $24 billion worth of its goods in 
2004, 25 percent of Brazil's total exports.  While Amorim 
conveys confidence that progress in the negotiations can be 
made in 2005, he has also suggested that the talks may 
proceed in tandem with the Doha negotiations.  Bilateral 
technical-level meetings were held December 2 last year in 
Rio de Janeiro and are expected again in February.  A meeting 
between Minister Amorim and UE Trade Commissioner Peter 
Mandelson in Davos at the end of January is meant to give 
impulse to a Ministerial slated for March that will set a 
work program for future discussions. 
 
¶7.   (SBU) Many Brazilian analysts are skeptical that the two 
sides' differences can be bridged in 2005.  Negotiations 
broke down in October 2004 over inadequate offers put forward 
by both sides.  Mercosul's last offer was a retrenchment, 
expanding product coverage to 90 percent, but reducing the 
percentage receiving duty-free status from 87.5 percent to 82 
percent.  Mercosul offerings in government procurement, IPR 
(geographic indicators), and investment were also deemed 
insufficient by the EU, whose own offer capped certain 
Mercosul agricultural exports at a level below current trade 
flows.  Agricultural products, which account for roughly 70 
percent of Brazil's exports to the EU, have figured 
prominently in the negotiations.  While questioning the EU's 
commitment to substantial agricultural trade liberalization, 
Brazil's private sector, particularly those represented by 
Sao Paulo's FIESP industrial federation (whose companies 
generate 70 percent of the country's GDP) also fault Foreign 
Ministry inflexibility and Mercosul internal disarray for the 
breakdown in negotiations. 
 
Free Trade Area of the Americas 
 
¶8.   (SBU) After FTAA negotiations went into abeyance in June 
of last year, the FTAA at times was absent from listings by 
Foreign Ministry officials of GoB trade priorities.  However, 
with the exchange of letters between out-going USTR Zoellick 
and Minister Amorim at the end of 2004, the FTAA has again 
crept onto the GoB trade agenda.  Official GoB remarks state 
a willingness to work in good faith with the U.S. as 
co-chairs to identify a way forward for the negotiations; 
Itamaraty highlights efforts for Amorim and Zoellick as well 
as for DUSTR Allgeier and his counterpart Ambassador Bahadian 
to meet to chart a course forward. 
 
¶9.  (SBU)  However, this is less than a full embrace.  In 
recent interviews Amorim has again clarified that while an 
FTAA is desirable, it is not essential for Brazil. 
Describing the current FTAA impasse as caused by the USG's 
insistence in negotiating rules for IPR, services and 
investment without adequately addressing Brazil's demands on 
agricultural subsidies, Amorim has emphasized that improved 
access to the U.S. market is key for Brazil, and that a focus 
on market access for goods would facilitate the negotiations. 
 Amorim also has reiterated that from Brazil's perspective, 
market access discussions with the U.S. need not be within 
the FTAA, but could also be pursued within a Mercosul-U.S. 
FTA.  The GoB position may have in fact hardened since last 
June, if, as top daily Folha suggests, President Lula 
believes he can prevail upon President Bush in a 
post-election environment to show greater flexibility on 
market access for key products, such as orange juice, sugar, 
steel and beef, if the U.S. is serious about moving the FTAA 
forward. 
 
¶10.  (SBU) Further complicating the public FTAA debate is the 
reemergence of a (in our view, flawed) December 2003 Ministry 
of Planning study which concludes that under an FTAA the 
bilateral U.S.-Brazil trade balance would swing to $1 billion 
in the USG's favor (Ref B).  Although publicly Amorim claimed 
the study supports his reticent stance toward the FTAA, 
Antonio Simoes (the ForMin's Economic Advisor) admitted to 
Ecouns in a January 12 converstaion, that no study, no matter 
how well-designed, could accurately predict the impact of an 
FTAA upon trade flows.   Simoes, former head of Itamaraty's 
FTAA Office, added that sensationalist press reporting of 
items such as this only make it more difficult for the two 
sides to reach consensus. 
 
¶11.  (SBU) While many economic analysts are not optimistic 
about near-term prospects for the FTAA, they argue that the 
FTAA is crucial for Brazil to avoid an erosion of 1) its 
relative level of competitiveness in the U.S. market 
vis-a-vis hemispheric competitors, and in other Latin markets 
vis-a-vis U.S. producers, and 2) its attractiveness as an FDI 
destination.  Export growth to the United States has not kept 
pace with the expansion of Brazil's exports overall; in 2004, 
Brazil's exports to the world grew by 32 percent to reach 
$96.5 billion, compared with a 20 percent increase in exports 
headed to the United States to total $20.0 billion.  In a 
study released November 4, 2004, former ambassador to the 
U.S. Rubens Barbosa and researchers from FIESP and the 
Institute of Studies of Trade and International Negotiations 
(Icone) claim Brazil's competitive position in the U.S. 
market vis-a-vis other regional partners is eroding and urge 
the GoB to address the issue in resumed FTAA negotiations 
(Ref B).  Some companies, including Dixie-Toga, whose 
president is head of Sao Paulo's AmCham, have made public 
their intention to consider investments in countries having 
trade agreements with the U.S., rather than expand domestic 
production. 
 
Canada 
 
¶12.   (SBU) The substantive scope of soon to be launched 
trade talks with Canada, and their relation to the FTAA, are 
unclear.  A joint communique issued during the visit of 
Canada's Prime Minister, Paul Martin, in November last year 
stated that he and President Lula "agreed to promote the 
expansion of commercial relations between Mercosul and Canada 
by means of market access negotiation in the areas of goods, 
services and investments, in the context of the configuration 
of a future FTAA."  In a subsequent conversation with 
Econoff, Canada's trade officer in Brasilia said the visit 
had caused a stir in Ottawa resulting in conflicting 
interpretations of what the "talks" would entail.  Despite 
Canada's uncertainty, its trade officer said there is no 
doubt that Minister Amorim believes Canada and Mercosul will 
be moving ahead with market access negotiations in the three 
areas.  Initial discussions may take place as early as 
February. 
 
South-South 
 
¶13.    (SBU) On December 20, Ambassador Regis Arslanian, 
Itamaraty's Director of International Negotiations, outlined 
prospects for 2005 for other trade negotiations.  Although 
Arslanian's list was lengthy, Ronaldo Costa Filho, who heads 
up the European Union and Extra-Regional Negotiations 
division for Arslanian, and Gilberto Goncalves de Siqueira, 
deputy in Itamaraty's Regional Integration Division, told 
Econoff that Mercosul's current plans include launching 
negotiations in 2005 with only three additional countries: 
Morocco, Egypt, and Mexico. 
 
¶14.   (SBU) Tariff preference negotiations, covering a 
limited number of products, will proceed with Morocco and 
Egypt based on relatively standard framework agreements 
signed November 26 and December 16, 2004, respectively. 
Indicative of Brazil's driving force behind Mercosul trade 
policy, according to Costa, the negotiations with Morocco are 
the result of intense lobbying by Brazil's Ambassador to 
Morocco, former FTAA negotiator Carlos Alberto Simas 
Magalhaes, while discussions between Minister Amorim and 
Boutros Boutros-Ghali during a G-20 meeting in December 2003 
have led to the negotiations with Egypt.  Two-way trade 
between Brazil and Morocco totaled only $560 million between 
January and November 2004; with Egypt only $593 million over 
the same period. 
 
¶15.   (SBU) The negotiations with Mexico follow up on the 
GoM's stated intention of seeking Mercosul associate 
membership, which requires a free trade agreement with the 
bloc.  The aim is to consolidate the trade agreements Mexico 
has with individual Mercosul partners, which vary in terms of 
coverage, to form a comprehensive Mercosul-Mexico FTA. 
Brazil currently has an Economic Complementary Agreement with 
Mexico, which covers only about 790 products, largely auto 
parts, chemicals, and some agricultural products, and an 
automotive agreement.  Two-way Brazil-Mexico trade reached 
$4.7 billion in 2004, dominated by Brazilian exports of $3.9 
billion.  Talk are expected to begin in the first semester of 
2005. 
 
Potential Negotiations 
 
¶16.   (SBU) Mercosul has established work programs for 
exploratory talks both with countries of the Central American 
Integration System (SICA) and with CARICOM.  Sessions with 
both groups are slated to take place in February and April, 
2005.  According to Siqueira, only after these sessions will 
Mercosul determine if there is an adequate convergence of 
interests to proceed with negotiations. 
 
¶17.  (SBU) According to Costa, Mercosul hopes to complete a 
feasibility study on negotiations with South Korea by the end 
of 2005.  Nonetheless, he did not expect trade negotiations 
to commence soon thereafter due to Brazilian private sector 
concerns with Korean protectionism, particularly in 
agriculture.  Pakistan and Israel have recently notified 
Mercosul of their interest in initiating trade negotiations. 
Other countries that have conveyed an interest in developing 
closer commercial relations with Brazil/Mercosul include: the 
EFTA countries, Australia, New Zealand, the Gulf Cooperation 
Council, and Japan. 
 
China 
 
¶18.   (SBU) As Brazil's largest market for soybeans and third 
largest individual export destination, the GoB views China as 
a key trading and geopolitical partner.  In 2003, Brazilian 
exports to China almost doubled totaling $4.5 billion.  With 
continued growth, exports reached $5.4 billion, and imports 
$3.7 billion in 2004.  The importance of the relationship was 
evident in the state visits paid by both leaders in 2004. 
However, Brazil's industrial sector is terrified of the 
competitive giant, particularly following Lula's decision to 
grant China "market economy" status (Refs D and E).  Despite 
an agreement during Lula's trip to China in May 2004 to 
conduct a feasibility study on launching Mercosul-China trade 
negotiations, Costa admitted to Econoff that work is not 
proceeding even on terms of reference for the study.  Even 
without formal trade negotiations, China will remain one of 
Brazil's more important commercial partners for the 
foreseeable future, not only as a market for its primary 
commodities, but also as source of infrastructure investment 
and collaboration in certain technology-related areas, 
including satellites and development of open-source software. 
 
Russia 
 
¶19.   (SBU) There are no plans by Mercosul at this time to 
negotiate a trade agreement with Russia.  References by GoB 
officials to trade talks typically refer to discussions on 
resolving specific impediments to trade, such as Russia's ban 
on imports of Brazilian beef stemming from foot and mouth 
disease outbreaks.  The two countries are also trying to 
stimulate bilateral trade through export promotion activities. 
Danilovich

Here are a couple more that mention Free/open source software:



UNCLAS SECTION 01 OF 04 BRASILIA 001307 
 
SIPDIS 
 
NSC FOR M DEMPSEY 
USDA FOR FAS/FAA/ITP, U/S PENN AND FAS ADMINISTRATOR TERPSTRA 
USDOC FOR 4322/ITA/MAC/WH/OLAC/WBASTIAN/JANDERSON/DMCDO UGALL/ 
ADRISCOLL 
USDOC FOR 3134/USFCS/OIO/DDEVITO/EOLSON 
TREASURY FOR OASIA/SEGAL 
PLS PASS TO EXIM FOR A FOLEY 
PLS PASS TO USTR FOR SCRONIN, LYANG, BPECK 
 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: EIND ECON EINV ETRD KIPR PGOV BR
SUBJECT: GRAB BAG OF GOB INDUSTRIAL POLICY MEASURES 
 
Refs: A) Brasilia 1098  B) Brasilia 661 
 
SENSITIVE BUT UNCLASSIFIED; PLEASE PROTECT ACCORDINGLY. 
 
¶1. (U)  Summary:  As promised, Minister of Development, 
Industry and Trade (MDIC) Luis Furlan unveiled a huge composite 
of measures under the umbrella of Industrial, Technology and 
Foreign Trade Policy (PITCE in the Portuguese acronym) on March 
¶31.  A grab bag of recycled programs, financing and tax 
incentives as well as new councils and government agencies, the 
PITCE comes with promises to modernize, restructure, and 
streamline the broken pieces of government that hamper 
industrial growth.  Attractively wrapped in technological 
innovation, the PITCE offers something for everyone (plus a 
little extra for the four strategic sectors of semiconductors, 
software, pharmaceuticals and capital goods) while attempting 
to appear sufficiently different from the discredited 
industrial policies of Brazil's past.  Fiscal constraints 
necessarily limit the viability of the various options, but the 
GoB has already budgeted R$ 550 million (US$ 183.3 million) for 
¶2004.  Furlan and his deputies insist that PITCE is not static 
and will be altered when necessary to fit the country's 
development needs.  Their assertion parallels Itamaraty's often- 
voiced reluctance to commit to any multilateral trade 
obligations that would limit GoB flexibility in this sphere. 
End Summary. 
 
Everything But The Kitchen Sink 
------------------------------- 
 
¶2. (U)  On its web site, MDIC defines over 50 industrial policy 
measures under the headings of a) industrial modernization, b) 
foreign markets & competitiveness, c) product, process, and 
management innovation, d) strategic options for semiconductors, 
e) software, f) capital goods and g) pharmaceuticals, h) 
harbingers of the future, i.e. biotech and nanotech i) 
strengthening small and medium enterprises, j) strengthening 
the national system of innovation, and k) creating a favorable 
environment for industrial development.  Each listing includes 
a definition of the measure, a goal and a responsible 
government entity to lead the effort.  With such broad 
parameters, existing programs are easily folded, or slightly 
modified to fit, into the PICTE. 
 
¶3. (U)  Under foreign markets and competition, export-promotion 
publicity campaigns executed by the Ministries of Tourism, 
Culture and Foreign Relations constitute a specific measure. 
The program "Brazil Exporter," launched in November 2003 by 
MDIC and also a PICTE measure, is itself a collection of 
assistance efforts aimed at getting small businesses to export 
via training, improvements in product design, and greater 
access to credit.  The PICTE broadens the Brazil Exporter 
program to include specific measures for Brazilian states 
underrepresented in the export market as well as a new drawback 
system that would partially reimburse import duties on goods re- 
exported or used in manufacture of exported goods.  Expanding 
the application of special computerized customs procedures to 
include semiconductors, and efforts to reinvigorate the 
metrology network and certification programs under the 
supervision on INMETRO (The National Institute of Metrology, 
Standards and Industrial Quality) for paper, cellulose and 
furniture industries, exemplify the relatively low-cost PICTE 
goal of redirecting the efforts of bureaucratic structures to 
accommodate sectors the GoB believes have greater export 
potential. 
 
¶4. (U)  Modernizing customs policies and procedures, 
facilitating the opening and closing of businesses, creating 
MDIC-led competitiveness forums for biotechnology and 
franchising, as well as development of a broad extension 
service designed to assist smaller businesses to export their 
products, typify the horizontal measures that account for much 
of the PICTE's efficiency and transparency goals.  The plan 
also calls for installation of foreign trade and investment 
attraction kiosks within the international branches of the Bank 
of Brazil, as well as the creation of five distribution and 
logistics centers overseas to support the efforts of small and 
medium-sized export businesses. 
 
¶5. (U)  The PICTE spawns more policymaking, calling for the 
development of specific industrial-policy programs for 
nanotechnology and biomass.  The PICTE prioritizes the passage 
of several bills including innovation legislation, which would 
create a legal framework for privately conducted research to be 
funded through government resources and, in some cases, using 
government labs.  Passage of a bill (1787/96) protecting the 
intellectual property of lay-out designs of integrated 
circuits, a TRIPS requirement that has lain dormant in the 
Brazilian Congress for several years, is now an objective of 
the Lula administration.  Digital inclusion and the free 
software movement also figure in the policy.  Incentives will 
be designed for the development of software solutions using 
open code, and the GoB plans to add 30,000 to the network of 
computer-using small businesses by 2007. 
 
Potentially Affecting the Bottom Line 
------------------------------------- 
 
¶6. (U)  At least eight of the PITCE measures are concrete tax 
or concessional financing incentives, the most broad being the 
"Modermaq" program which offers fixed-rate 5-year financing for 
up to 90 percent of the sale price of industrial-equipment 
purchases.  In addition to Modermaq, the PICTE includes a 
reduction of the import tax on some capital goods without 
locally or Mercosul-produced equivalents.  (Note:  Brazil 
grants case-by-case reduced tariff rates on specialized capital 
goods not produced locally.) This reduction of the exceptional 
tariff rates from 4 to 2 percent for goods produced within 
Mercosul and to zero for goods not produced within Mercosul 
began with the implementation of a resolution in February 2004. 
The GoB characterizes the equalization of the COFINS (social 
security system contribution) tax on imports and exports 
(reftel A) and the gradual elimination (starting with a 30 
percent rate reduction in 2004) of the industrial production 
tax (IPI) on equipment destined for productive activity as 
PICTE measures as well.  A Presidential decree (no. 4,928/03) 
of December 2003 permits reductions in the calculation of the 
net profit taxes (CSLL) for businesses that invest in 
technological research and product development. 
 
¶7. (U)  The meat of the benefits for the four strategic sectors 
are Brazilian Development Bank (BNDES) lines of credit for 
software marketing and export; pharmaceutical production, 
research activities, business incorporation, acquisition and 
fusion; and the purchase or production of made-to-order capital 
goods.  The line of credit for semiconductor production will 
come from the Ministry of Science and Technology's (MCT) FINEP, 
the Ministry's financing arm for studies and projects linked to 
sector specific funds.  2004 financing under these credit 
schemes ranges from R$ 10 million for chips to R$500 million 
for pharmaceuticals and capital goods. 
 
More or Less Bureaucracy? 
------------------------- 
 
¶8. (U)  The PICTE calls for the creation of a National Council 
of Industrial Development as well as a Brazilian Agency for 
Industrial Development. While both are to be organized by MCT 
and MDIC, the Council would bring together government, business 
and labor to help define policy directives, and the Agency 
would concentrate the execution of policy objectives in one 
government organ.  In addition, the PICTE envisions a one-stop- 
shop for potential investors that would also develop the agenda 
for sector-specific investments.  Called the "Special Room for 
Attracting Investment," this permanent group directly linked to 
the Presidency would bring together representatives of the 
Ministries of Development, Foreign Relations, Finance, 
Planning, Mines and Energy, Agriculture, Science and 
Technology, Tourism, and the Civil Household. 
 
Government-run Labs 
------------------- 
 
¶9. (U)  Several PICTE objectives aim to create new public 
laboratories, and to modernize existing ones.  While several 
are specific to the pharmaceutical sector, including a new 
national factory for the production of blood tests and vaccines 
and a laboratory for nuclear medicine research and production, 
others would focus on metrology and biotechnology.  A planned 
national public laboratory for chemical metrology would 
establish a certification framework to judge the purity of 
chemical products, and a national laboratory for material 
metrology would set national standards for building materials 
such as ceramics and carbon fiber products.  The National 
Laboratory of Industrial Technology will develop projects and 
promote research in applied micro and nantechnology in 
partnership with businesses and the function of the 
Biotechnology Center of the Amazon, inaugurated in 2002, will 
be strengthened to better assist businesses with sustainable 
harvesting of biotech production for commercial purposes.  The 
policy recognizes that bringing successful innovations to 
market will require strong intellectual property protection, 
especially in the target areas of pharmaceuticals, software, 
nanotech, and biotech.  Therefore, the restructuring of the 
Brazilian Patent Institute (INPI) and improving the regulation 
of ANVISA, the Brazilian Sanitary Surveillance Agency, are key 
PICTE measures that require further elaboration (septel). 
 
Comment 
------- 
 
¶10. (SBU) The PICTE is nothing if not ambitious in scope, and 
it endeavors to encompass parts of the GoB's total development 
agenda, even social priorities in health and education through 
digital inclusion and expanding production at public labs. 
Inclusive, modern, nationalist, populist, this policy offers 
something to every constituent.  By promoting industrial growth 
and efficiency via incentives to invest in new technology and 
export, particularly high-value added goods and services, the 
real prize the Lula administration seeks is job growth. 
Fostering cutting-edge technological development in the 
innovative sectors of the future and correcting bureaucratic 
bottlenecks is the icing on the cake that appeals more to the 
business than labor crowd. 
 
¶11. (SBU)  Above all, the set of measures which Lula's GoB is 
cumulatively presenting as its industrial policy is manifestly 
crafted to avoid significant new budget outlays or adverse 
policy impact.  The designers of the PICTE creatively aim to 
accomplish its specific goals with minimal fiscal distress, 
chiefly by re-modeling existing structures and supplementing 
the energy of the private sector.  While there are some clear 
import-substitution goals, especially in pharmaceuticals, 
petroleum and gas production, the plan introduces no overtly 
protectionist quotas or tariff hikes.  Those measures that 
require substantial public investment like the creation of new 
public laboratories may necessarily be longer-term goals, 
despite Brazil's world-class research capabilities, due to the 
tight fiscal environment.  MDIC's Secretary for Production, 
Carlos Gastaldoni has frankly characterized the PICTE to us as 
part standard operating procedure and part wish list.  He 
considered the Modermaq program as the most significant in 
short-term impact, characterizing the access to capital at a 
fixed rate as one of the biggest hurdles small Brazilian 
businesses face.  He noted that the strong emphasis on 
technological innovation should help guarantee a dynamic policy 
that can respond to industry's evolving needs. 
 
¶12.  (SBU)  The GoB's industrial-policy ideology has a trade- 
policy dimension.  Lula's administration considers its freedom 
to intervene with government supports as potentially essential 
for Brazil's industrial progress.  Any proposal -  presented in 
the context of free trade or not -- that might hem in this 
ability is rebuffed as an effort to deny an indispensable 
right, a right that, GoB interlocutors often remind us, more 
developed economies have freely exercised in the past. 
Brazilian recognition that the positives and negatives of 
globalization have significantly altered governments' toolkit 
of viable options plainly influenced this leftist GoB's 
supposedly improved version of national `industrial policy.' 
The result aims to be a hybrid applicable to Brazil's local 
realities, but also compatible with existing trade commitments. 
In practice, its impact in the internal sphere is likely to 
remain muted.  There is far too little in GoB coffers to 
significantly subsidize chosen industries and too much reliance 
on trade earnings for this GoB to repeat wholesale the statist 
policy errors of the nation's 1950s'-1970s' past.  For current 
and future trade negotiations, however, industrial policy goals 
will continue to limit what the GoB views as in its interest 
for further liberalization in sectors such as services, 
government procurement, investment and IPR. 
 
HRINAK

And another one:



VZCZCXRO9665
RR RUEHRG
DE RUEHBR #1355/01 1861906
ZNR UUUUU ZZH
R 051906Z JUL 06
FM AMEMBASSY BRASILIA
TO RUEHC/SECSTATE WASHDC 5995
INFO RUEHRI/AMCONSUL RIO DE JANEIRO 2417
RUEHRG/AMCONSUL RECIFE 5074
RUEHSO/AMCONSUL SAO PAULO 7379
RUEHBU/AMEMBASSY BUENOS AIRES 4125
RUEHAC/AMEMBASSY ASUNCION 5527
RUEHMN/AMEMBASSY MONTEVIDEO 6346
RUEHSG/AMEMBASSY SANTIAGO 5616
RUEHPE/AMEMBASSY LIMA 3070
RUEHCV/AMEMBASSY CARACAS 3331
RUEHQT/AMEMBASSY QUITO 1886
RUEHLP/AMEMBASSY LA PAZ 4689
RUEHBO/AMEMBASSY BOGOTA 3826
RUCPDO/USDOC WASHDC
RUEHGV/USMISSION GENEVA 1495
 
UNCLAS SECTION 01 OF 03 BRASILIA 001355 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE PASS USTR 
GENEVA FOR USTR 
STATE PASS USPTO 
USDOC FOR 4332/ITA/MAC/WH/OLAC/MWARD 
USDOC FOR 3134/ITA/USCS/OIO/WH/RD/SHUPKA 
 
E.O. 12958:  N/A 
TAGS: KIPR ECPS BR
SUBJECT: BRAZILIAN COPYRIGHT OFFICE SEEKS AN ALTERNATIVE PATH ON IPR 
ISSUES 
 
 
¶1.  (SBU) Summary.  Recently, Econ and FCS personnel met with 
officials at Brazil's Copyright Office (organizationally, located 
within the Ministry Culture) to discuss Brazil's emerging policy on 
IPR and digital inclusion issues.  This meeting was to follow-up on 
an earlier, June 7 session between U.S. Patent and Trademark Deputy 
Director Stephen Pinkos and counterpart Brazilian policy level 
officials.  Our interlocutors outlined the full array of challenges 
they faced, inter alia,  resistance within Brazilian domestic 
industry to paying royalties, bureaucratic and statutory obstacles 
to the  development of a balanced doctrine of "fair use," and, of 
course, rampant piracy.  (Notwithstanding Brazil's plethora of 
well-known musicians, because of copyright piracy, we were told, no 
more than 30 could make a living from musical royalties.)  The 
Ministry had established a network of cultural facilities which 
artists could use for free, provided they licensed any works 
produced there to the creative commons.  Internationally, our 
contacts complained of developed country dominance at the World 
Intellectual Property Organization (WIPO) and stated that the idea 
behind Brazil's proposed "Development Agenda" was to level the IPR 
playing field.  End Summary. 
 
¶2.  (SBU)  On June 28, FSC Deputy Senior Commercial Officer, Econ 
Counselor and Econ Assistant met with Marcel Alves da Souza, the 
head of the Ministry of Culture's Copyright Office, and Angeline 
Monteiro Prata, the Ministry's Copyright Manager, to learn more 
about the workings of that office.  Souza declared that the 
Copyright Office was besieged on all fronts as private industry 
sought to enforce its legal rights in the face of widespread piracy, 
while government policymakers (in particular Minister of Culture 
Gilberto Gil) actively worked to afford citizens greater access to 
informational materials.  Notwithstanding the Copyright Office's 
best efforts, it was becoming increasingly difficult to reconcile 
the conflicting demands, he stated. 
 
--------------------- ------------------ ------------------ 
Payments for Use of Copyrighted Songs in Audio-Visual Works 
--------------------- ------------------ ------------------ 
¶3.  (SBU)  Souza cited as an example the payment of fees to musical 
copyright holders when their works were used in domestic Brazilian 
films.  In such cases, a private sector organization, RECADE, he 
noted, was charged with collecting compensation from filmmakers. 
However, the film industry balked at paying such monies, arguing 
(incorrectly) that this was not the practice in the U.S.  Indeed, he 
continued, using that argument the film lobby had nearly gotten the 
Brazilian Congress to enact legislation withdrawing the legal 
requirement to pay compensation in these situations, though that 
effort had ultimately failed.  Further complicating the matter, was 
the lack of transparency of RECADE itself, with a number of artists 
alleging that it keeps for itself an undue share of the fees 
collected on their behalf. 
 
---------------------------------- 
Piracy and the "Fair Use" Doctrine 
---------------------------------- 
¶4.  (SBU)  Discussion then turned to the issue of the scope of the 
"fair use" doctrine in Brazil - i.e., the degree to which the public 
could use minor portions of a copyrighted work without paying 
royalties to the author.  Souza stated that while the vast 
disparities in income in Brazil militated in favor of an expanded 
"fair use" doctrine, in fact, Brazil, as was the case in many other 
Latin American countries, applied the concept more restrictively 
than in the United States.  Part of the problem, he observed, was 
that statutory code, rather than common law, governed on this issue, 
and even though the relevant statute had been enacted in 1998 in 
many ways it was already out of date.  The public's increasing use 
of the internet meant that the statute needed to be reworked.  To 
help tip the scales in favor of reform, he observed, the Ministry 
sought to organize civil society groups (like libraries) to lobby 
for greater "fair use."  However, the local IPR legal lobby 
vigorously opposed this, he noted, notwithstanding the fact that it 
 
BRASILIA 00001355  002 OF 003 
 
 
was practically impossible for rightholders to collect royalties for 
such small-scale activity. 
All that restricting the "fair use" doctrine did, he concluded, was 
make the public insensitive to the difference between minor copying 
and blatant piracy. 
 
¶5. (SBU)  The textbook example of this, Souza stated, was textbooks. 
 There were cases of enforcement entities catching students for 
small-scale copying while true pirates - i.e., those who xeroxed and 
sold entire textbooks - often got away scot free.  The GOB realized 
that if it could persuade the publishing industry to lower the price 
of school books, then it might be able to reduce the economic 
incentive for piracy.  Hence, the GOB eliminated valued added taxes 
on textbooks.  Yet, the tax cuts did not result in lower prices, 
Souza said, as the industry - noting the limited demand for 
Portuguese-language publications - argued that its high prices 
helped it cover high costs due to the lack of economies of scale. 
 
---------------------------------- 
Digital Inclusion and Cultura Viva 
---------------------------------- 
¶6.  (SBU) Souza noted that Minister Gilberto Gil was a strong 
advocate of accommodating intellectual property rights protection to 
"the needs of development."  In this vein, Gil has been outspoken on 
issues such as free software and digital inclusion of disadvantaged 
populations.  Domestically, one program which the Ministry has taken 
to implement this vision is "Cultura Viva," the principal element of 
which is the establishment of various cultural centers throughout 
the country where low-income artists could have access to studios, 
internet connections, and other production facilities.  Cultural 
centers have been set-up - through contracts with local NGOs - in 
such major cities as Sao Paulo, Rio de Janeiro, Salvador, and 
Brasilia.  The only requirement that the government levies on the 
use of such facilities is that the artist license whatever they 
produce to the creative commons.  The idea is that providing young 
artists a platform to create, Souza said, gives them the opportunity 
to gain recognition - which can then translate into market 
bargaining power.  The most notable works which have come from these 
cultural centers, he noted, have been innovative hip-hop routines 
produced in Rio. 
 
---------------------------- 
The GOB's Development Agenda 
---------------------------- 
¶7.  (SBU)  Souza, Brazil's representative at the World Intellectual 
Property Organization (WIPO), stated that the GOB felt that within 
that entity the deck was stacked in favor of the developed 
countries.  The rich nations, he intimated, were able to buy votes 
from the Third World by offering benefits like technical assistance 
or even travel money and per diem.  Hence, he said, the GOB and its 
emerging country allies, had formulated the "Development Agenda" to 
break the developed countries' hegemony over the discussion of IPR 
issues.  The "Development Agenda," he continued, was simply the 
international component of the GOB's overall efforts to make IPR 
policy more consistent with the needs of emerging nations. 
International copyright protection should not be absolute, he 
declared, and Brazil was intent on pushing this point in 
multilateral fora.  One example of how the status quo needed to 
change, he observed, was the treatment of translations.  Given that 
so few people in Brazil spoke English, he noted, the issue of 
protection of translated work had special significance for the GOB. 
Why should a translated work receive full copyright protection, he 
asked, if the copyright had already lapsed on the original work? 
 
------- 
Comment 
------- 
¶8.  (SBU) Though the positions Souza and Prata espoused were in line 
with the ruling PT party's stance on IPR, they took pains to make 
clear that they were non-partisan.  As civil servants, they would 
 
BRASILIA 00001355  003 OF 003 
 
 
likely remain in their jobs, they said, even if the opposition PSDB 
party (generally considered to be more business-friendly) were to 
prevail in the October 2006 election.  Indeed, in our chat with him, 
Souza declared that the "Development Agenda" would remain high on 
Brazil's priorities within WIPO for the foreseeable future. 
 
Williamson

Gilberto Gil, the artist, is mentioned by name as he “has been outspoken on issues such as free software and digital inclusion of disadvantaged populations.”


VZCZCXRO9665
RR RUEHRG
DE RUEHBR #1355/01 1861906
ZNR UUUUU ZZH
R 051906Z JUL 06
FM AMEMBASSY BRASILIA
TO RUEHC/SECSTATE WASHDC 5995
INFO RUEHRI/AMCONSUL RIO DE JANEIRO 2417
RUEHRG/AMCONSUL RECIFE 5074
RUEHSO/AMCONSUL SAO PAULO 7379
RUEHBU/AMEMBASSY BUENOS AIRES 4125
RUEHAC/AMEMBASSY ASUNCION 5527
RUEHMN/AMEMBASSY MONTEVIDEO 6346
RUEHSG/AMEMBASSY SANTIAGO 5616
RUEHPE/AMEMBASSY LIMA 3070
RUEHCV/AMEMBASSY CARACAS 3331
RUEHQT/AMEMBASSY QUITO 1886
RUEHLP/AMEMBASSY LA PAZ 4689
RUEHBO/AMEMBASSY BOGOTA 3826
RUCPDO/USDOC WASHDC
RUEHGV/USMISSION GENEVA 1495
 
UNCLAS SECTION 01 OF 03 BRASILIA 001355 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE PASS USTR 
GENEVA FOR USTR 
STATE PASS USPTO 
USDOC FOR 4332/ITA/MAC/WH/OLAC/MWARD 
USDOC FOR 3134/ITA/USCS/OIO/WH/RD/SHUPKA 
 
E.O. 12958:  N/A 
TAGS: KIPR ECPS BR
SUBJECT: BRAZILIAN COPYRIGHT OFFICE SEEKS AN ALTERNATIVE PATH ON IPR 
ISSUES 
 
 
¶1.  (SBU) Summary.  Recently, Econ and FCS personnel met with 
officials at Brazil's Copyright Office (organizationally, located 
within the Ministry Culture) to discuss Brazil's emerging policy on 
IPR and digital inclusion issues.  This meeting was to follow-up on 
an earlier, June 7 session between U.S. Patent and Trademark Deputy 
Director Stephen Pinkos and counterpart Brazilian policy level 
officials.  Our interlocutors outlined the full array of challenges 
they faced, inter alia,  resistance within Brazilian domestic 
industry to paying royalties, bureaucratic and statutory obstacles 
to the  development of a balanced doctrine of "fair use," and, of 
course, rampant piracy.  (Notwithstanding Brazil's plethora of 
well-known musicians, because of copyright piracy, we were told, no 
more than 30 could make a living from musical royalties.)  The 
Ministry had established a network of cultural facilities which 
artists could use for free, provided they licensed any works 
produced there to the creative commons.  Internationally, our 
contacts complained of developed country dominance at the World 
Intellectual Property Organization (WIPO) and stated that the idea 
behind Brazil's proposed "Development Agenda" was to level the IPR 
playing field.  End Summary. 
 
¶2.  (SBU)  On June 28, FSC Deputy Senior Commercial Officer, Econ 
Counselor and Econ Assistant met with Marcel Alves da Souza, the 
head of the Ministry of Culture's Copyright Office, and Angeline 
Monteiro Prata, the Ministry's Copyright Manager, to learn more 
about the workings of that office.  Souza declared that the 
Copyright Office was besieged on all fronts as private industry 
sought to enforce its legal rights in the face of widespread piracy, 
while government policymakers (in particular Minister of Culture 
Gilberto Gil) actively worked to afford citizens greater access to 
informational materials.  Notwithstanding the Copyright Office's 
best efforts, it was becoming increasingly difficult to reconcile 
the conflicting demands, he stated. 
 
--------------------- ------------------ ------------------ 
Payments for Use of Copyrighted Songs in Audio-Visual Works 
--------------------- ------------------ ------------------ 
¶3.  (SBU)  Souza cited as an example the payment of fees to musical 
copyright holders when their works were used in domestic Brazilian 
films.  In such cases, a private sector organization, RECADE, he 
noted, was charged with collecting compensation from filmmakers. 
However, the film industry balked at paying such monies, arguing 
(incorrectly) that this was not the practice in the U.S.  Indeed, he 
continued, using that argument the film lobby had nearly gotten the 
Brazilian Congress to enact legislation withdrawing the legal 
requirement to pay compensation in these situations, though that 
effort had ultimately failed.  Further complicating the matter, was 
the lack of transparency of RECADE itself, with a number of artists 
alleging that it keeps for itself an undue share of the fees 
collected on their behalf. 
 
---------------------------------- 
Piracy and the "Fair Use" Doctrine 
---------------------------------- 
¶4.  (SBU)  Discussion then turned to the issue of the scope of the 
"fair use" doctrine in Brazil - i.e., the degree to which the public 
could use minor portions of a copyrighted work without paying 
royalties to the author.  Souza stated that while the vast 
disparities in income in Brazil militated in favor of an expanded 
"fair use" doctrine, in fact, Brazil, as was the case in many other 
Latin American countries, applied the concept more restrictively 
than in the United States.  Part of the problem, he observed, was 
that statutory code, rather than common law, governed on this issue, 
and even though the relevant statute had been enacted in 1998 in 
many ways it was already out of date.  The public's increasing use 
of the internet meant that the statute needed to be reworked.  To 
help tip the scales in favor of reform, he observed, the Ministry 
sought to organize civil society groups (like libraries) to lobby 
for greater "fair use."  However, the local IPR legal lobby 
vigorously opposed this, he noted, notwithstanding the fact that it 
 
BRASILIA 00001355  002 OF 003 
 
 
was practically impossible for rightholders to collect royalties for 
such small-scale activity. 
All that restricting the "fair use" doctrine did, he concluded, was 
make the public insensitive to the difference between minor copying 
and blatant piracy. 
 
¶5. (SBU)  The textbook example of this, Souza stated, was textbooks. 
 There were cases of enforcement entities catching students for 
small-scale copying while true pirates - i.e., those who xeroxed and 
sold entire textbooks - often got away scot free.  The GOB realized 
that if it could persuade the publishing industry to lower the price 
of school books, then it might be able to reduce the economic 
incentive for piracy.  Hence, the GOB eliminated valued added taxes 
on textbooks.  Yet, the tax cuts did not result in lower prices, 
Souza said, as the industry - noting the limited demand for 
Portuguese-language publications - argued that its high prices 
helped it cover high costs due to the lack of economies of scale. 
 
---------------------------------- 
Digital Inclusion and Cultura Viva 
---------------------------------- 
¶6.  (SBU) Souza noted that Minister Gilberto Gil was a strong 
advocate of accommodating intellectual property rights protection to 
"the needs of development."  In this vein, Gil has been outspoken on 
issues such as free software and digital inclusion of disadvantaged 
populations.  Domestically, one program which the Ministry has taken 
to implement this vision is "Cultura Viva," the principal element of 
which is the establishment of various cultural centers throughout 
the country where low-income artists could have access to studios, 
internet connections, and other production facilities.  Cultural 
centers have been set-up - through contracts with local NGOs - in 
such major cities as Sao Paulo, Rio de Janeiro, Salvador, and 
Brasilia.  The only requirement that the government levies on the 
use of such facilities is that the artist license whatever they 
produce to the creative commons.  The idea is that providing young 
artists a platform to create, Souza said, gives them the opportunity 
to gain recognition - which can then translate into market 
bargaining power.  The most notable works which have come from these 
cultural centers, he noted, have been innovative hip-hop routines 
produced in Rio. 
 
---------------------------- 
The GOB's Development Agenda 
---------------------------- 
¶7.  (SBU)  Souza, Brazil's representative at the World Intellectual 
Property Organization (WIPO), stated that the GOB felt that within 
that entity the deck was stacked in favor of the developed 
countries.  The rich nations, he intimated, were able to buy votes 
from the Third World by offering benefits like technical assistance 
or even travel money and per diem.  Hence, he said, the GOB and its 
emerging country allies, had formulated the "Development Agenda" to 
break the developed countries' hegemony over the discussion of IPR 
issues.  The "Development Agenda," he continued, was simply the 
international component of the GOB's overall efforts to make IPR 
policy more consistent with the needs of emerging nations. 
International copyright protection should not be absolute, he 
declared, and Brazil was intent on pushing this point in 
multilateral fora.  One example of how the status quo needed to 
change, he observed, was the treatment of translations.  Given that 
so few people in Brazil spoke English, he noted, the issue of 
protection of translated work had special significance for the GOB. 
Why should a translated work receive full copyright protection, he 
asked, if the copyright had already lapsed on the original work? 
 
------- 
Comment 
------- 
¶8.  (SBU) Though the positions Souza and Prata espoused were in line 
with the ruling PT party's stance on IPR, they took pains to make 
clear that they were non-partisan.  As civil servants, they would 
 
BRASILIA 00001355  003 OF 003 
 
 
likely remain in their jobs, they said, even if the opposition PSDB 
party (generally considered to be more business-friendly) were to 
prevail in the October 2006 election.  Indeed, in our chat with him, 
Souza declared that the "Development Agenda" would remain high on 
Brazil's priorities within WIPO for the foreseeable future. 
 
Williamson


Lastly, the following cable says that Rogerio Santana “mentioned the importance of a public software website, administered by his office, offering free software to assist local administrations throughout the country.”


VZCZCXRO3444
RR RUEHRG
DE RUEHBR #0003/01 0021945
ZNR UUUUU ZZH
R 021945Z JAN 08 ZDK
FM AMEMBASSY BRASILIA
TO RUEHC/SECSTATE WASHDC 0750
INFO RUEHRI/AMCONSUL RIO DE JANEIRO 5621
RUEHSO/AMCONSUL SAO PAULO 1392
RUEHRG/AMCONSUL RECIFE 7540
 
UNCLAS SECTION 01 OF 02 BRASILIA 000003 
 
SIPDIS 
 
SIPDIS 
PARIS FOR OECD 
 
E.O. 12958:N/A 
TAGS: ECON EINV SCUL PREL BR
SUBJECT: OECD DSG AT BRAZIL KNOWLEDGE MANAGEMENT CONFERENCE 
 
 
BRASILIA 00000003  001.2 OF 002 
 
 
¶1. OECD Deputy Secretary General Thelma Askey spoke at a conference 
in Brasilia, the "Fourth International Conference on Knowledge 
Management in the Public Sector" on December 11.  The Brazilian 
Chamber of Deputies, Planning Ministry, Presidential Council for 
Economic Development, and Long-Term Planning Secretariat organized 
the conference with the Brazilian Association of Knowledge 
Management (SBGC).  The conference explored how better to 
incorporate knowledge management into public administration in 
Brazil, drawing on local and international experiences and lessons 
learned.  The conference considered the definitions of "knowledge 
management," noted its effects on economic growth, and examined the 
specific situation in Brazil.  Other speakers included the Brazilian 
Minister of Science and Technology, the head of the Brazilian 
Chamber of Deputies, and the Casa Civil (Presidency) E-Government 
office.  End Summary. 
 
------------------------------ 
SAMPLING OF BRAZILIAN SPEAKERS 
------------------------------ 
 
¶2. Arlindo Chinaglia, Chairman of the Chamber of Deputies, opened 
the conference.  He noted knowledge management, with origins in the 
corporate sector, proves its value in the public sector if it helps 
improve the quality of services to the population. He noted the 
website Interlegis (www.interlegis.gov.br), developed by the 
Brazilian congress with IDB assistance, is an example of knowledge 
management. The website furthers government transparency and 
information sharing by facilitating public access to congressional 
activities and legislation. 
 
¶3. Sergio Resende, Minister of Science and Technology, noted that 
knowledge management is a challenge to Brazil's public sector mainly 
due to systemic education problems.   As an example, masters and PhD 
programs in the United States have existed for 150 years, while in 
Brazil these programs began 40 years ago according to the minister. 
Brazilian corporations' knowledge management challenges now include 
innovation and research and development.  The Minister added that 
the Brazilian Innovation Law provides subsidies for investment in 
technology, including e-government.  Rogerio Santana, Executive 
Secretary for e-government at the Casa Civil, Presidency of the 
 
SIPDIS 
Republic, expanded on this theme, saying knowledge management 
includes both what people know and how they share their information. 
 He mentioned the importance of a public software website, 
administered by his office, offering free software to assist local 
administrations throughout the country.  Santana noted as well that 
knowledge management is not only the federal government pushing 
information out to local entities.  Knowledge management also means 
creating opportunities for local-level talent, including indigenous 
and riverside cultures, to enrich federal level decision-making. 
 
¶4. Federal Deputy Gastao Vieira, Education Committee Chairman, 
further developed the education theme, strongly asserting Brazil 
needs to implement a literacy program for elementary schools, 
drawing on best-practices at state level for educational reform.  He 
noted a 2003 GOB report that found teacher training programs in 
Brazil are thirty years out of date.  The deputy felt the poor 
performance of Brazilian students on the OECD PISA (Program for 
International Student Assessment) exams reflected the lack of 
investment in education and Brazil's failure to set a few achievable 
priorities (e.g. an adequate syllabus, teacher training, and 
materials investment) instead of myriad overambitious goals.  He 
commented that knowledge management and international trade are also 
linked, as increased know-how raises exported products' value-added 
and trade itself increases knowledge acquisition. 
 
-------------- 
OECD DSG ASKEY 
-------------- 
 
¶5. Thelma Askey, OECD Deputy Secretary-General, spoke on a panel 
entitled "The Public Policy of Knowledge Management and the Agenda 
of Global Development" with Maristela Baioni, program coordinator in 
Brazil for UNDP. Askey underlined that knowledge management is among 
OECD governments' top five policy priorities.  OECD identifies and 
shares best practices in order to enhance this global public good 
for all countries.  OECD knowledge management goals include: 1) 
helping members adapt to change; 2) opening communication channels; 
3) furthering investment in higher education and in information 
technologies; and 4) promoting integration and exchanges among 
academic institutions, the private sector and the public sector. 
 
¶6. DSG Askey noted that the OECD has an indicator for measuring 
investment in knowledge, and that OECD member countries invest, on 
average, nearly six percent of GDP in knowledge development and 
management.  Investment mechanisms include e-government structures; 
higher education; development and implementation of research 
systems, databases and internet platforms; and partnerships among 
governments.  Askey stressed that, for the public sector, investment 
in knowledge management should target building public trust, for 
example through creation of reliable, independent statistics 
 
BRASILIA 00000003  002 OF 002 
 
 
agencies.  Askey advocated that governments should create incentives 
for knowledge sharing and should stress transparency and policy 
coherence.  Ms. Askey concluded by reiterating the importance of 
coordination among private sector, academic and public sector 
institutions, as well as the importance of sharing experiences and 
lessons learned among countries. 
 
¶7. COMMENT:  The conference provided an important opportunity for 
Brazilian government, academia and international organizations to 
share perspectives on increasing transparency and investment in 
knowledge in a democracy.  The event, co-planned by Brazil's 
executive and legislative branches with civil society participation, 
was an interesting and informative step in Brazil's on-going public 
sector reform dialogue.  END COMMENT 
 
CHICOLA


We will hopefully find time to return to Brazil in the future of this Cablegate series. What the US wants is the sort of compliance we see in Portugal, another Portuguese-speaking nation. To pick just one cable from Portugal, consider the following one which says: “Patent Protection: Currently, Portugal’s patent protection is governed by the Code of Industrial Property that went into effect on June 1, 1995. In 1996, new legislation was passed to extend the life of then-valid patents to 20 years, consistent with the provisions of TRIPS. A new industrial property code, designed to bring Portugal into full conformity with EU and international norms, came into effect at the beginning of 2003.”

Here is the full cable:



VZCZCXRO8178
RR RUEHIK
DE RUEHLI #0022/01 0141440
ZNR UUUUU ZZH
R 141440Z JAN 10
FM AMEMBASSY LISBON
TO RUEHC/SECSTATE WASHDC 8060
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RUCPCIM/CIMS NTDB WASHDC

UNCLAS SECTION 01 OF 07 LISBON 000022 
 
SIPDIS 
 
DEPT FOR EB/IFD/OIA 
DEPT ALSO FOR USTR 
 
E.O. 12958: N/A 
TAGS: EINV [Foreign Investments], EFIN [Financial and Monetary Affairs], 
ETRD [Foreign Trade], ELAB [Labor Sector Affairs], KTDB [National Trade Data Bank], 
PGOV [Internal Governmental Affairs], OPIC [Overseas Private Investment Corporation], 
USTR [Office of the Special Representative for Trade Negotiations], 
PO [Portugal; Azores; Madeira Islands] 
SUBJECT: PORTUGAL'S 2010 INVESTMENT CLIMATE STATEMENT 
 
REF: 09 STATE 124006 
 
LISBON 00000022  001.2 OF 007 
 
 
¶1.  The following is Portugal's submission for the 2010 
 Investment Climate Statement: 
 
A. Openness to Foreign Investment 
 
Portugal offers a favorable investment climate for foreign 
capital, both in the near and long term. Its economy has 
become increasingly diversified and service-based since the 
country joined the European Community in 1986. On January 1, 
2002, Portugal introduced the euro as its official currency, 
further integrating itself with the European Union's 
financial and economic policies. Prime Minister Jose 
Socrates, who began his second term in office in 2009, 
has made opening Portugal's economy to foreign investment 
a key priority. 
 
Government Promotion Agencies: The agency leading Portugal's 
economic development policy is AICEP (the Portuguese Agency 
for Foreign Investment and Commerce). AICEP is responsible 
for the promotion of global Portuguese trademarks, exports of 
goods and services, and attracting foreign direct investment 
(FDI). It serves as the point of contact for investors with 
projects over 25 million euros or companies with a 
consolidated turnover of more than 75 million euros. For 
foreign investments not meeting these requirements, AICEP 
will make a preliminary analysis and direct the investor to 
assistance agencies such as IAPMEI, the Institute for the 
Support of Small- and Medium-sized Enterprises (SMEs), which 
provides technical support, or to AICEP CAPITAL GLOBAL, 
which offers technology transfer, incubator programs and 
venture capital support. 
 
Government Policies - General: According to the Bank of 
Portugal, foreign direct investment is defined as an act or 
contract that obtains or increases enduring economic links 
with an existing Portuguese institution or one to be formed. 
Foreign direct investment is thus all investment made by a 
non-resident of, at least, 10 percent of a resident company's 
equity, provided that the direct investor also plays a role 
in the company's decision making. 
 
The Portuguese legal system is based on non-discrimination 
with regard to the national origin of investment, and 
foreigners are permitted to establish themselves in all 
economic sectors open to private enterprise.  However, 
foreign and domestic investments alike are limited in 
relation to certain economic activities. Portuguese 
government approval is required in the following sectors: 
defense, water management, public service telecommunications 
operators, railways, maritime transportation and air 
transport, or if they involve the exercise of public 
authority. Private-sector companies can operate in these 
areas only through a concession contract. 
 
Finance/Insurance: Investors wishing to establish new 
credit institutions or finance companies, acquire a 
controlling interest in such financial firms, and/or 
establish a subsidiary must have authorization from the 
Bank of Portugal (for EU firms) or the Ministry of Finance 
(for non-EU firms). In both cases, the authorities 
carefully consider the proposed transaction, but in the 
case of non-EU firms, the Ministry of Finance especially 
considers the impact on the efficiency of the financial 
system and the internationalization of the economy. 
Non-EU insurance companies seeking to establish an agency 
in Portugal must post a special deposit and financial 
guarantee and must have been authorized for such activity 
by the Ministry of Finance for at least five years. 
 
Foreign Workers: Non-Portuguese EU workers must obtain a 
residence card for EU nationals but are not required to have 
work permits.  Non-EU workers are required to have both a 
residence visa and a work permit. The permanent authorization 
for residence is granted when an employee has a labor 
contract, rent contract or a permanent resident evidence 
document and is registered in the Social Security Services. 
The request is processed at the Servios de Estrangeiros e 
Fronteiras (SEF) Branch. The requests are regulated by the 
act Law 23/2007 dd 4/07 and by the Decree-Law 84/2007 dd 
05/11.  For more information visit http://www.sef.pt 
 
Structural and Cohesion Funds: For the 2007-2013 programming 
period, Portugal has been allocated 21.5 billion euros of 
Structural and Cohesion Funds financing under the European 
Union's Convergence, Regional Competitiveness and 
 
LISBON 00000022  002.2 OF 007 
 
 
Employment, and Territorial Cooperation program. Portugal 
plans to use the funds to develop a skilled workforce, to 
promote sustainable growth, to guarantee social cohesion, to 
ensure territorial development, and to improve governance 
efficiency.  One of the most important public policy 
priorities for growth and competitiveness of the Portuguese 
economy is the Technological Plan, an action agenda which 
aims to mobilize enterprises, families and institutions to 
overcome the modernization challenges the country has faced 
during the last years.  For more information visit 

http://www.planotecnologico.pt

Following are Portugal rankings for several widely-accepted 
measures of the business and investment environment: 
 
Measure                       Year         Ranking 
-------                       ----        --------- 
TI Corruption Index           2009        35 of 180 
Heritage Economic Freedom     2009        53 of 179 
World Bank Doing Business     2010        48 of 183 
 
For more information about these measures visit: 
http://www.transparency.org/policy research/surveys indices/ 
cpi/2009/cpi 2009 table 

http://www.heritage.org/index/


http://www.doingbusiness.org/economyrankings/

B. Conversion and Transfer Policies 
 
Portugal maintains no current or capital account 
restrictions. 
On January 1, 1999, Portugal and ten other European countries 
formed the European Monetary Union. On January 1, 2002, 
Portugal introduced the euro as its official currency, 
replacing the Portuguese escudo which is no longer in 
circulation.  Currently, there are sixteen member-states that 
use the euro. 
 
C. Expropriation and Compensation 
 
There have been no cases of expropriation of foreign assets 
or 
companies in Portugal in recent history, nor is there concern 
about future expropriation. 
 
Banco Portugues de Negocios (BPN) was nationalized November 
2, 
2008, the first bank nationalization in Portugal since 1975. 
At the time of the nationalization BPN had lost approximately 
700 million euros from declining investment values from the 
global financial crisis, but the Ministry of Finance stressed 
that BPN was taken over as a result of an ongoing 
investigation into mismanagement and malfeasance. 
 
D. Dispute Settlement 
 
The Portuguese legal system is slow and deliberate, with many 
cases taking years to resolve. In an effort to address this 
problem, the government introduced reforms in litigation 
procedures and public administration in 2007. These reforms 
are intended to reduce delays in the justice system and 
improve its effectiveness by reorganizing the court system 
and redefining the division of the court's jurisdiction. 
 
E. Performance Requirements and Incentives 
 
As an incentive to both national and foreign companies, 
resident entities or branches of non-resident entities whose 
main activity is of a commercial, industrial or agricultural 
nature are subject to a corporate income tax (IRC) with a 
rate of 12.5 percent for the first 12,500 euros of income 
and 25 percent for income exceeding 12,500 euros, and a set 
municipal surcharge of no greater than 1.5 percent of 
company's taxable profit subject to IRC.  Rates vary from 
municipality to municipality. Other tax regimes are in place 
for the country's two autonomous island regions: the Azores 
and Madeira. 
 
The Portuguese Government also offers several incentive 
packages tailored to investors' needs and capital based on 
industry, proposed size of investment and project 
sustainability. Details about the programs are available 
on the AICEP website: http://www.portugalglobal.pt 
 
For example, under Portugal's investment incentive regime, 
AICEP is empowered to negotiate a tailored incentives 
package for large investment projects on a case-by-case 
 
LISBON 00000022  003.2 OF 007 
 
 
basis, including tax cuts and subsidized or interest-free 
loans, as well as cash grants. Large-scale investment 
projects are investment projects exceeding 25 million euros, 
within a period of three years, or those promoted by a 
company, or group of companies with a total turnover greater 
than 75 million euros. The goal of the program is to leverage 
investments for proposed projects that support the 
government's economic development goals. AICEP has designed 
the program to address Portugal's long-term competitiveness, 
including human resources, and to promote Portugal's brands 
and patents in the industrial, energy, construction, 
transport, tourism, commerce and services sectors. 
For more information visit http://www.portugalglobal.pt 
 
The National Strategic Reference Framework (NSRF) seeks to 
improve the quality of Portugal's workforce and encourage 
economic and socio-cultural development through expanded 
human resources development opportunities, support for 
entrepreneurship and innovation, streamlined public 
administration, and other measures. 
For more information visit http://www.qren.pt or 

http://www.incentivos.qren.pt

F. Right to Private Ownership and Establishment 
 
Private Ownership/Enterprise: Private ownership is limited 
to 49 percent in the following sectors: basic sanitation 
(except waste treatment), international air transport, 
railways, ports, arms and weapons manufacture, and airports. 
The government requires private firms to obtain concessions, 
contracts, and licenses to operate in a number of sectors 
(public service television, waste distribution, waste 
treatment), but grants these on a non-discriminatory basis. 
Foreign firms have the right to establish themselves in all 
economic sectors open to private enterprise. Foreign 
investments affecting public health, public order or 
security, or relating to the arms industry, require 
approval of the competent authorities. 
 
Competitive Equality: Law No.18/2003, of June 6, 2003, 
governs protection and promotion of competition in Portugal. 
It specifically outlaws collusion between companies to fix 
prices, limit supplies, share markets or sources of supply, 
discriminate in transactions, or force unrelated obligations 
on other parties. Similar prohibitions apply to any company 
or group with a dominant market position. The law also 
requires prior government notification of mergers or 
acquisitions which would serve to give one company more than 
30 percent market share in one sector or among entities 
which had total sales in excess of 150 million euros in the 
preceding financial year. The Competition Authority has 60 
days to determine if the merger or acquisition can proceed. 
The European Commission may claim authority on cross-border 
competition issues or those involving entities large enough 
to have a significant EU market share.  For more information 
visit http://www.concorrencia.pt/en/index.asp 
 
Privatization Program: Portugal engaged in a wide-ranging 
privatization program that sold 100 enterprises and 
generated approximately USD 14 billion in revenues between 
1996 and 2006. Privatization involves the sale of government 
shares in state-owned companies, typically in a series of 
share offerings. These share offerings often include private 
transactions, usually to attract a "strategic partner" as an 
equity holder, and public offerings. 
 
Major privatizations in recent years included sales of 
interest in Portugal Telecom (telecommunications), EDP 
(electricity), REN (Electricity Transmission System Operator) 
and GALP Energia (petroleum refining and marketing, natural 
gas distribution). 
 
G. Protection of Property Rights 
 
The government adopted the Agreement on Trade Related 
Aspects of Intellectual Property Rights (TRIPS) and 
provisions of General Agreement on Tariffs and Trade (GATT) 
in 2003. Portuguese legislation for the protection of 
intellectual property rights has been consistent with WTO 
rules and EU directives since 2004. 
 
Portugal is a participant in the eMAGE and eMARKS projects, 
which provide multilingual access to databases of trademarks 
and industrial designs. These international efforts assist 
participating customs authorities in preventing sales of 
counterfeit goods. Other countries involved include France, 
Austria, Hungary and Spain. 
 
LISBON 00000022  004.2 OF 007 
 
 
 
Trademark Protection: Portugal is a member of the 
International Union for the Protection of Industrial Property 
(WIPO) and a party to the Madrid Agreement on International 
Registration of Trademarks and Prevention of the Use of False 
Origins. Portugal's current trademark law entered into force 
on June 1, 1995. The law, however, is not considered to be 
entirely consistent with TRIPS. 
 
Copyright Protection: Portugal has transposed the EU 
information society and protection of databases directives 
into national legislation (Decree-Law 50/2004 and 112/2000, 
respectively). However, the software piracy rate is slightly 
greater than average software piracy rate in EU. 
 
Patent Protection: Currently, Portugal's patent protection is 
governed by the Code of Industrial Property that went into 
effect on June 1, 1995. In 1996, new legislation was passed 
to extend the life of then-valid patents to 20 years, 
consistent with the provisions of TRIPS. A new industrial 
property code, designed to bring Portugal into full 
conformity with EU and international norms, came into effect 
at the beginning of 2003. 
 
Portugal grants health (FDA-equivalent) approval to market 
new drug products without crosschecking for existing products 
with unexpired patent protection already in the market. This 
forces companies to pursue redress through the court system, 
an expensive and time-consuming process. U.S. pharmaceutical 
companies have brought a number of cases before Portuguese 
tribunals for the violation of patent rights by Portuguese 
companies. One U.S.-owned pharmaceutical company has won 
five cases and has several more pending. 
 
H. Transparency of Regulatory System 
 
In the recent past, businesses frequently complained about 
red tape with regards to registering companies, filing 
taxes, receiving value-added tax refunds and importing 
materials. Decision-making tended to be centralized and 
obtaining government approvals/permits can be time- 
consuming and costly. 
 
The Ministry of Economy has promoted various initiatives 
to improve the situation. In 2007, it worked with the 
Ministry of Justice to launch the "Cutting Red Tape" 
website, a repository of information for all measures taken 
since 2005 to reduce bureaucracy in the incorporation, 
registration, certification, liquidation, dissolution and 
merging of businesses in Portugal. Other initiatives include 
the "Empresa na Hora" (On-the-Spot Company) which allows for 
the incorporation of companies in less than one hour at 
Corporate Formalities Centers and Business Registration 
Offices; and other services such as online company 
incorporation, labor mediation, bilingual commercial 
registration, and patents and trademarks. Since 2005, a 
total of 14,471 companies have been incorporated under the 
"Empresa na Hora" program, while over 450 companies have 
been incorporated using the online service. More information 
can be found at the "Cutting Red Tape" website: 

http://www.cuttingredtape.mj.pt

I. Efficient Capital Markets and Portfolio Investment 
 
One result of Portugal's participation in the European 
Monetary Union is the country's increasing integration into 
a European-wide financial market.  As a member of the Euro- 
zone, Portugal offers low exchange rate risk for foreign 
investors, interest rates comparable to other EU countries 
and a greater availability of credit. In addition to bank 
lending, the private sector has access to a variety of credit 
instruments, including bonds. Legal, regulatory, and 
accounting systems are consistent with international norms. 
 
The Portuguese capital markets code (the CVM) came into 
effect on March 1, 2000, and has rationalized and streamlined 
Portuguese capital markets legislation. The Lisbon stock 
market is part of Euronext, which also includes the Paris, 
Brussels and Amsterdam markets. 
 
Portugal has about 45 banking institutions, and the six 
largest bank groups account for seventy-eight percent of 
the sector's total assets.  The country's largest bank, 
Caixa Geral de Depositos (CGD), is controlled by the 
Portuguese government. Despite recent economic challenges, 
the financial sector continues to perform well. 
 
 
LISBON 00000022  005.2 OF 007 
 
 
In addition to banks and stock markets, Portugal has taken 
specific steps to ensure that the financial needs of SMEs 
are met. IAPMEI has a program of mutual guarantees so that 
SMEs do not have to use their assets or those of their 
shareholders to collateralize debt. The companies pay an 
initial evaluation fee and an annual fee equal to 0.75-3.00 
percent of the guarantee. IAPMEI has also supported the 
creation of venture capital funds and venture capital 
companies, which will channel capital to SMEs. 
 
J. Competition from State Owned Enterprises 
 
The Portuguese system is based on non-discrimination 
regarding national origin of investment.  Foreign and 
domestic private companies are limited in relation to 
certain economic activities, such as water utilities, 
postal services, rail transport and the maritime ports. 
Private sector companies, regardless of national origin, 
can operate in these restricted fields only through a 
concession contract. 
 
There is no sovereign wealth fund in Portugal. 
 
K. Corporate Social Responsibility 
 
There is strong awareness of corporate social responsibility 
in Portugal, and broad acceptance of the need to consider the 
community among the key stakeholders of any company.   RSE 
Portugal (Corporate Social Responsibility Portugal), the 
leading association for corporate social responsibility in 
Portugal, was formed in 2002 as the successor to the 
Portuguese Business Network for Social Cohesion, which was 
formed in 1996.  RSE Portugal aims to build bridges between 
the private sector and key stakeholders towards a more 
responsible and sustainable future.  RSE Portugal's mission 
is to promote corporate social responsibility as business' 
contribution for sustainable development through the 
conception, execution, and support of programs and projects 
in educational, formative, social, cultural, scientific, 
environmental, civic, and economic areas in Europe and in 
developing countries.  Since its formation RSE Portugal has 
sponsored numerous classes and workshops promoting corporate 
social responsility and collaborated with Nike to fund and 
support innovative projects for young people in the areas of 
social sciences, health, education, and training.  RSE 
Portugal has also carried out studies of competitiveness 
and sustainability in the construction industry in 
collaboration with counterpart organizations in Italy, 
Spain, Hungary, and Austria. 
 
For more information visit http://www.rseportugal.eu 
 
L. Political Violence 
 
There have been no incidents involving politically 
motivated damage to projects and/or installations. 
Potentially destructive civil disturbances are not likely. 
 
M. Corruption 
 
Corruption plays a limited role in Portugal's business 
culture. Although U.S. firms occasionally encounter limited 
degrees of corruption in the course of doing business in 
Portugal, they do not identify corruption as an obstacle to 
foreign direct investment. In Transparency International's 
2009 Corruption Perceptions Index, Portugal ranked 35 out 
of 180 countries considered (listed from least to most 
corrupt). Portugal has ratified the OECD Anti-bribery 
Convention and recently passed legislation to bring its 
criminal code in compliance with the Convention. Tax evasion 
remains a problem for the government, which has implemented 
several initiatives to improve collection rates. The 
Socrates administration is taking steps to address the 
limited degrees of corruption that businesses, both U.S. 
and other, face in Portugal. 
 
N. Bilateral Investment Agreements 

http://www.portugalglobal.pt

Listing of International Treaties: 
http://www.gddc.pt/siii/paises-organizacoes.a sp 
 
O. OPIC and Other Investment Insurance Programs 
 
Portugal is a country with low political risk, and the 
potential for significant OPIC insurance programs in 
 
LISBON 00000022  006.2 OF 007 
 
 
Portugal is limited.  Portugal is a member of the 
Multinational Investment Guarantee Authority (MIGA) of 
the World Bank. 
 
P. Labor 
 
Numerous labor reform packages aimed at improving the 
productivity of Portugal's workforce have been enacted 
over recent years, with limited success.  A package of 
labor reform laws took effect in 2003 permitting greater 
geographic and functional mobility for employees. The labor 
code limits the role of unions and makes it more difficult 
for workers to strike. It also addresses absenteeism and 
fraudulent leave. Additional changes were enacted in 2009 
clarifying rules concerning intermittent and seasonal 
employment, specifying leave flexibility regarding 
parenthood and family support, and other issues.  However, 
low productivity and difficulty in firing workers continue 
to hamper Portugal's ability to attract foreign investment. 
 
Labor strikes and work stoppages in Portugal, as in much of 
Europe, are more common than in the United States. Most 
strikes, however, are of short duration. In recent years 
work stoppages have been more common among public sector 
workers, including the transportation sector and teachers, 
than in the private sector. 
 
Portugal is a member of the International Labor Organization 
(ILO) and adheres to the ILO Conventions Protecting Labor 
Rights. Portugal ratified ILO Convention 138, which 
establishes a minimum employment age of 15 for all economic 
sectors. As of January 1, 1997, the minimum working age in 
Portugal is 16, thereby exceeding the ILO norm. 
 
Unemployment: Portugal's unemployment rate reached 10.3 
percent in the 4th quarter of 2009. This is an increase of 
30 percent from the same quarter of 2008 (7.8 percent) and 
up 0.5 percent from the previous quarter (9.8 percent). The 
number of unemployed was estimated to be 575.6 thousand 
individuals. 
 
Q. Foreign-Trade Zones/Free Ports 
 
Portugal has two foreign trade zones (FTZ)/free ports in the 
island autonomous regions of Madeira and the Azores. These 
foreign trade zones/free ports were authorized in conformity 
with EU rules or incentives granted to member states. 
Industrial and commercial activities, international service 
activities, trust and trust management companies, and 
offshore financial branches are all eligible. Companies 
established in the foreign trade zones enjoy import/export- 
related benefits, financial incentives, tax incentives for 
investors and tax incentives for companies. 
 
The Madeira FTZ has approximately 6,500 registered 
companies.  Under the terms of Portugal's agreements with 
the EU, companies in the Madeira FTZ can take full advantage 
of the tax incentives provided until December 2011, when 
those incentives will begin to be phased out.  For more 
information visit 

http://www.madeira-management.com

R. Foreign Direct Investment flows into Portugal 

http://www.portugalglobal.pt

S. Portuguese Trade with the U.S. 

http://www.census.gov/foreign-trade

T. Major Foreign Direct Investors 
 
Selected Major Foreign Investors in Portugal: 

http://www.portugalglobal.pt

U. Web Resources 
 
Bank of Portugal: 

http://www.bportugal.pt

Portuguese Agency for Foreign Investment and Commerce: 

http://www.portugalglobal.pt

"Cutting Red Tape": 

http://www.cuttingredtape.mj.pt

Empresa na Hora (On-the-Spot Firm): 
 
LISBON 00000022  007.2 OF 007 

http://www.empresanahora.pt

QREN (National Strategic Reference Framework 2007 - 2013) 

http://www.qren.pt

EUROSTAT (Statistical Office of the European Communities): 

http://ec.europa.eu/eurostat

U.S. Census Bureau: 

http://www.census.gov

Technological Plan: 

http://www.planotecnologico.pt

The "Cutting Red Tape" Investment Incentive Program: 
www.cuttingredtape.mj.pt 
 
Portuguese Government: 

http://www.portugal.gov.pt

American Chamber of Commerce in Lisbon: 

http://www-cca.cliente.imediata.pt

IAPMEI (Institute for S.M.E. Support and Investment): 

http://www.iapmei.pt

INPI (Portuguese Patent and Trademark Office): 

http://www.inpi.pt

Trade and Competition Directorate-General: 

http://www.dgcc.pt

US Commercial Service in Portugal: 

http://www.buyusa.gov/portugal/en

BALLARD 
 
 
For more reporting from Embassy Lisbon and information about Portugal, 
please see our Intelink site: 
 
http://www.intelink.sgov.gov/wiki/portal:port ugal 
BALLARD

In summary, the US wants Brazil to be more like Portugal before it can be removed from a “watch list” that shames Brazil into accepting other nations’ sovereignty.

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3 Comments

  1. twitter said,

    September 11, 2011 at 11:08 am

    Gravatar

    I see now that IPR actually stands for “intellectual property regime”, an expansion that makes a lot more sense than “intellectual property rights”. Phrases like,

    Widespread recognition of the harm caused by IPR abuse to Brazilian artists, tax revenues, and technological progress/industrial development has increased, due in part to successful public awareness campaigns launched by both the private and public sectors.

    suddenly have new meaning.
    On an another note, there’s a lot more than shame to trade restrictions. There’s real financial loss and business pain. It’s criminal that free software use was included in the criteria for punishment. All the shame is on the US for allowing foreign and trade policy to be manipulated by big publishers like Microsoft at the expense of other US companies, everyone’s liberty and US reputation. The purposes of the sanctions list are blatantly anti-competitive.

  2. Agent_Smith said,

    September 12, 2011 at 9:16 am

    Gravatar

    It’s very sad when one sees governments acting like thugs for criminal companies. Not just M$, but also Monsanto. I live in Rio Grande do Sul, and Monsanto’s GMO spread like a plague over here. Worse, it makes food more expensive, and, the effects on human beings, in the long run, no one knows.
    In other subject, these subservient governments give democracy a bad name, since they don’t act in their people’s best interests, but in the best interests of their funders(the aforementioned criminal companies).
    Shame on you, US of A, land of the fee and home of the slave.

    twitter Reply:

    Our democracy is sick and needs help. People need to talk to each other more and stop listening to broadcast media. They also need to vote. That way, they will be better informed and make the right choices.

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