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Cablegate: Business Software Alliance (BSA) Pretends to Speak for Open Source, MPA Creates Imaginary Links to Crime

Cablegate



Summary: In Malaysia, the 'IP' propaganda runs rampant -- a lot more rampant than actual 'piracy' and a cable shows how it's done

According to the following cable from the embassy in Kuala Lumpur (Malaysia), not only is Microsoft lobbying to make copyright infringement (even backup) a crime; its proxies do similar things. The following Cablegate cable reveals lobbying for patents not just from ACT but also from the Business Software Alliance (BSA).



Here is the best part: "He also pointed out that BSA supports technology neutral government procurement, given that its membership straddles both sides of the open source software debate."

Really?

"Here is another priceless example not of pretending to be one's own opposition but more of the usual lie that tries to tie copyright infringement with terrorism in order to pass new laws."IBM left the BSA and just about every member is a proprietary software company. Here is another priceless example not of pretending to be one's own opposition but more of the usual lie that tries to tie copyright infringement together with terrorism in order to pass new laws. "Gane also raised the significant funding through IPR crime of other criminal activity."

There is another lie trying to imply that if Hollywood does not get a licence to its copyright terrorism regime, then people will die (same propaganda gets used for ACTA these days). Read this piece of propaganda: "Cyril Chua, a Singapore attorney who represents the Entertainment Software Alliance, noted the particularly high rates of piracy in Malaysia in that area of optical media (over 90 percent by some estimates). Like his industry colleagues, he pointed to the weak prosecution of cases as a prime concern, noting that the government has not strengthened prosecution to keep up with its strengthened enforcement efforts. Tom Hart of Aztra Zeneca, who represented Amcham's pharmaceutical committee, pointed out that, while his industry faces different obstacles from optical media industry, counterfeit pharmaceuticals posed a direct threat to the health of Malaysian consumers, and thus necessitated particularly strong enforcement and prosecution."

The short version: "pass more draconian laws for our dear Hollywood masters or your people will die."

Now, that's how lobbying is done. The full cable follows.










VZCZCXRO0200 RR RUEHCHI RUEHDT RUEHHM RUEHNH DE RUEHKL #0794/01 1220415 ZNR UUUUU ZZH R 020415Z MAY 06 FM AMEMBASSY KUALA LUMPUR TO RUEHC/SECSTATE WASHDC 6530 INFO RUCNASE/ASEAN MEMBER COLLECTIVE RUCPDOC/DEPT OF COMMERCE WASHDC RUEAWJA/DEPT OF JUSTICE WASHDC

UNCLAS SECTION 01 OF 05 KUALA LUMPUR 000794

SIPDIS

SIPDIS

STATE FOR EB/TPP/MTA/IPC - FELSING STATE PASS USTR FOR B. WEISEL, J. JENSEN, V. ESPINEL USDOC FOR JENNIFER BAKER COMMERCE PASS USPTO FOR P. FOWLER

E.O. 12958: N/A TAGS: ETRD [Foreign Trade], KIPR [Intellectual Property Rights], MY [Malaysia] SUBJECT: U.S.-MALAYSIA INTELLECTUAL PROPERTY RIGHTS ROUNDTABLE

Summary and Introduction ------------------------

ۦ1. The U.S. and Malaysia held a long-anticipated IPR Roundtable on April 20 in Kuala Lumpur. Approximately seventy participants from the Malaysian and U.S. governments, as well as industry and civil society, gathered to discuss IPR enforcement efforts, industry views on combating piracy, IPR protection within the context of free trade agreements, and the U.S. perspective on IPR protection, including the use of specialized IPR courts. Participants also discussed U.S.-Malaysian cooperation efforts, including the ongoing provision by the U.S. of capacity building for Malaysian officials. The Ambassador and the Minister of Domestic Trade and Consumer Affairs launched the event and also held a joint press conference. The Roundtable was co- chaired by the DCM and by Deputy Secretary General Mohamed Nor Hj. Abd Aziz of the Ministry of Domestic Trade and Consumer Affairs (MDTCA).

Ambassador LaFleur and Minister Shafie Launch the --------------------------------------------- ---- Roundtable ----------

ۦ2. Ambassador LaFleur kicked off the event with a speech that countered common excuses made by purchasers of stolen IP, such as the cost of optical media and the alleged lack of harm to IP producers. He emphasized the need for the U.S. and Malaysia to continue to work together to change the common perception among consumers that IPR piracy is not a true crime. The Ambassador urged Malaysia's leaders to project more public opposition to IPR piracy. High-level advocacy was essential not only to stem retail piracy, but more broadly to further Malaysia's goal of developing a knowledge-based economy, which is strongly influenced by foreign investors' assessments of whether their IPR would be protected. The Ambassador welcomed Minister of Domestic Trade and Consumer Affairs Shafie Apdal's commitment to implement a specialized IPR court, as well as his more recent initiative to obtain legal authority to act against owners of retail premises that routinely sell pirated products.

ۦ3. Minister Shafie placed the IPR Roundtable in the context of the upcoming U.S.-Malaysia FTA negotiations, expressing his hope that negotiators of the FTA's IPR chapter would build on the day's events. He acknowledged that IPR theft was a drain on Malaysia's economic growth and would inhibit its ultimate economic success, and noted his particular concern about Malaysia's reputation as one of the leading exporters of pirated optical disc media. Shafie listed a range of actions that Malaysia had undertaken to attack piracy, including an increasing number of seizures, more effective prosecution that included higher fines and longer sentences for convicted IPR pirates, and the creation of an export enforcement unit to strengthen controls at international air and sea gateways. He noted the ministry's intention to hire over 700 new enforcement officers this year and reiterated his plan to implement soon a specialized IPR court.

ۦ4. The Ambassador and Minister Shafie held a joint press conference following the opening session, which received wide coverage from the media. They conveyed many of the same themes in their remarks to the press. Press questions focused on a news report that the Recording Association of Malaysia had brought suit against a local shopping mall for its failure to stop sales of pirated CD's on its premises. Minister Shafie confirmed that he is seeking administrative authority to enable his Ministry to independently pursue such cases.

KUALA LUMP 00000794 002 OF 005

U.S. and Malaysian Approaches to Enforcement --------------------------------------------

ۦ5. Econoff presented the USG STOP Initiative as an effort by the United States to improve its interagency coordination in IPR enforcement. Although the United States has long led global efforts to protect intellectual property, enhanced coordination through STOP was helping U.S. agencies to improve their effectiveness against organized IP crime. Econoff noted that engagement with U.S. trading partners on IPR protection was a key component of the initiative; our commitment to improving IPR enforcement in the region was shown by the recent posting to Bangkok of an IP attach and an IP law enforcement coordinator, both with regional responsibilities. The U.S. would continue to provide IP training and capacity building programs for foreign officials, and welcomed Malaysia's ongoing participation in such initiatives.

ۦ6. Roslan bin Mahayuddin, MDTCA Acting Director General for Enforcement, gave an overview of Malaysia's recent enforcement activity, noting in particular that 2006 was shaping up to be a record year in terms of seizures of pirated IPR in Malaysia. Roslan reiterated Shafie's statement that the establishment of the MDTCA's Export Unit in April 2005 was a key component of Malaysia's strengthened enforcement efforts. More than RM 50 million (approximately USD 13.8 million) in merchandise has been seized so far this year, compared to seizures worth just over RM 100 million in all of 2005, in part through better coordination on seizures destined for export. Roslan noted that the number of licensed optical media disc factories in Malaysia has been reduced from 44 to 38 in the last year, and several other pending license revocations would continue to bring that number down to a level more commensurate with the legitimate Malaysian market. An optical disc forensic laboratory was established in 2003 in coordination with the government Chemistry Department; Roslan acknowledged that no cases have yet been developed based on forensics evidence corroborated by the new lab, though he suggested that would soon change.

ۦ7. USPTO Senior Counsel Peter Fowler provided an overview of U.S. judicial enforcement of IPR. The U.S. has long experience in protecting IPR that could inform other countries like Malaysia on the most effective means to enforce IPR. Fowler highlighted a number of facets of U.S. IPR enforcement, including a reliance on civil litigation, supplemental use of criminal prosecution, and the predominance of the federal court system for litigation rather than state or local courts. Government must be involved in IPR enforcement because such protection is in the public interest, going beyond the interests of individual piracy victims. Fowler added that piracy is often committed without the victim's knowledge, and the victim usually has no direct relationship with the infringer; in such situations a victim might be unable to pursue civil remedies, leaving criminal penalties as the only effective recourse. Criminal sanctions may also be necessary in cases where fines might be treated by IPR violators as just a cost of doing business.

ۦ8. Fowler presented a number of models that Malaysia could consider as it moves toward implementing a specialized IPR court, including separate specialized courts or judicial panels, such as in Thailand and Korea, or designated existing courts to handle IPR cases, as in Japan, Singapore, Indonesia, Taiwan and the Philippines. He noted that the U.S. had no designated IPR court, though we do have a special appeals court to handle patent litigation. Regardless of the

KUALA LUMP 00000794 003 OF 005

approach, a specialized IPR judicial regime was important given technically complicated cases involving science, technology innovation, patents, and transnational civil litigation. Specialization would allow for a better-informed judiciary, more focused law enforcement, better case management and dedicated resources to continuously promote protection.

IPR Protection in the FTA Context ---------------------------------

ۦ9. Econ Counselor gave a general overview of the typical provisions of an IPR chapter in a U.S. free trade agreement, after cautioning that his presentation should not be seen as pre-judging the treatment of IPR in the upcoming U.S-Malaysia FTA negotiations. He noted that U.S. Trade Promotion Authority (TPA) sets as an FTA negotiating objective the promotion of effective IPR protection through accelerated implementation of TRIPS, in particular its enforcement aspect; by ensuring that FTA provisions reflect a standard of protection similar to U.S. law; and by providing strong protection for new and emerging technologies. Typical IPR chapters in past FTAs have included provisions on trademarks, copyrights, patents, Internet domain names, satellite broadcasts, and enforcement and criminal procedures.

Industry Views - Improving Enforcement, Continuing Concerns --------------------------------------------- ----- ---------

ۦ10. While representatives from a range of IPR industry associations expressed appreciation for the Malaysian government's recent enforcement successes and its commitment to IPR protection, they were not shy about raising their varied concerns on the state of IPR protection here. Jeff Hardee, Regional Vice President of the Business Software Alliance, noted that an effective IPR court would necessitate better- trained prosecutors than exist at present, and he called on Malaysia to fully implement all WIPO treaties. He also pointed out that BSA supports technology neutral government procurement, given that its membership straddles both sides of the open source software debate. Neil Gane, Senior Operational Director of the Motion Picture Association, noted MPA's appreciation for the government's enforcement efforts, which had reduced DVD piracy substantially in the last few years. Despite reducing the number of licensed OD factories, however, MPA continues to believe the country has far too many production lines, and which keeps it a significant exporter of pirated products. Gane also raised the significant funding through IPR crime of other criminal activity.

ۦ11. Su Siew Ling, a Kuala Lumpur attorney who represents the Association of American Publishers, said the AAP's primary concern in Malaysia is the widespread photocopying of textbooks, particularly around university campuses. She pointed out that illegal photocopiers typically produce on demand, keeping virtually no stock on hand that would help authorities prove counterfeit production. Photocopiers are aided by Malaysia's copyright law, which allows for possession of up to three copies of a work for private/personal use. Siew Ling said AAP continued to advocate stronger anti- piracy action by means of increased surveillance in chronic areas, such as near universities; an increased willingness by authorities to enforce actions against photocopiers, and to follow up with effective prosecution of such cases; an enhanced public awareness program, especially among teachers and students; and increased use of civil action against violators.

KUALA LUMP 00000794 004 OF 005

ۦ12. Cyril Chua, a Singapore attorney who represents the Entertainment Software Alliance, noted the particularly high rates of piracy in Malaysia in that area of optical media (over 90 percent by some estimates). Like his industry colleagues, he pointed to the weak prosecution of cases as a prime concern, noting that the government has not strengthened prosecution to keep up with its strengthened enforcement efforts. Tom Hart of Aztra Zeneca, who represented Amcham's pharmaceutical committee, pointed out that, while his industry faces different obstacles from optical media industry, counterfeit pharmaceuticals posed a direct threat to the health of Malaysian consumers, and thus necessitated particularly strong enforcement and prosecution.

Current and Future Cooperation ------------------------------

ۦ13. The U.S. and Malaysia continue to cooperate on a number of capacity building programs. Peter Fowler noted that the most effective training programs are those that can reach a broad set of officials, and that can be institutionalized relatively quickly so that an organization's improved performance does not depend on the continued employment of those officials who initially receive training. Fowler pointed out the May 2006 seminar on IP prosecution in KL, which is an ASEAN-sponsored event with significant financial and logistical support from USPTO. He noted USPTO's active training schedule in Southeast Asia, where it typically works through ASEAN to set up capacity building sessions. He also pointed out the recent inauguration of the Global Intellectual Property Academy at USPTO, which has already trained several Malaysian participants. Siti Eaisah of the Malaysian Intellectual Property Office (MyIPO) noted her appreciation of the training USPTO has provided to MyIPO officials, and said her office needed particular assistance in training patent examiners in specialized areas like biotechnology and engineering. Othman Nawang of the MDTCA's enforcement division said his officers would benefit from training in surveillance and detecting techniques, combating Internet piracy, criminal profiling, and optical disc forensics.

ۦ14. Industry representatives were united about the need to improve public awareness on the need to protect intellectual property. Chua said ESA has launched an IP initiative in public schools aimed at young children, viewed as the most persuadable audience, even if the results from such outreach may not be apparent until such kids reach their early teenage years. MPA likewise sees schools as a main focus of its outreach efforts. While agreeing on the importance of educating consumers, particularly children and young adults, BSA's Jeff Hardee pointed out that there are no shortcuts to strong enforcement measures. He raised the issue of piracy in the U.S., which continued to be a major concern throughout the IP industry despite extensive public outreach (he noted that, while U.S. piracy rates are fairly low by Southeast Asian standards, overall losses there remain very high). Strong enforcement is a tool along with education in deterring IP theft, he added.

ۦ15. The DCM wrapped up the Roundtable by acknowledging our existing and future cooperative efforts, including the Roundtable itself. Our bilateral cooperation had been one factor in Malaysia's improving ability to fight piracy, and the U.S was committed to continuing our effective collaboration. The U.S. looked forward to Malaysia's continuing efforts, including the upcoming establishment of an IPR court. The FTA talks would ensure that IPR protection would be a prime topic of bilateral government discussion in the coming year, which we hoped would lead to an

KUALA LUMP 00000794 005 OF 005

FTA that would continue to advance our cooperation.

Comment -------

ۦ16. The IPR Roundtable was a welcome opportunity for an open discussion of Malaysia's efforts to protect intellectual property, and was especially well timed given our imminent launch of negotiations on an FTA. MDTCA officials are understandably proud of the progress they have made in enhancing enforcement and expressed a strong commitment to furthering those gains. They also recognize that one of the government's principal goals in the just released Ninth Malaysia Plan - creating a more knowledge-based economy - will depend heavily on the government's ability to protect IPR, both to encourage local entrepreneurs as well as the foreign investors who would help support them. Our industry representatives acknowledged Malaysia's progress and commitment, but made clear that the government had a long way to go in creating an effective deterrent that would help effect a significant shift in the average Malaysian's attitude toward IPR piracy.

ۦ17. Embassy was pleased by the large, diverse turnout at the Roundtable, which included some NGO participants that have been vocal critics of the U.S.-Malaysia FTA. Their comments during the Roundtable indicated they we didn't change any minds, but we were pleased to be able to explain to them our views on the benefits of an FTA to Malaysia, including through enhanced IPR protection. The Roundtable deepened our bilateral dialogue on IPR, and could lead to the organization of similar events in the future, perhaps after the conclusion of our upcoming FTA negotiations.

LAFLEUR







This is the only Malaysian cable that we found interesting and relevant thus far.

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