US embassy cable - 04LAGOS456

UNCLAS SECTION 01 OF 03 LAGOS 000456 
 
SIPDIS 
 
STATE FOR EB/IPC WILSON 
SATE PASS USTR FOR PBECK 
COMMERCE FOR KSCHLEGELMILCH 
USPTO FOR JURBAN/DLASHLEY-JOHNSON 
LOC FOR STEPP 
 
E.O. 12958: N/A 
TAGS: KIPR, ETRD, ECON, EINV, NI 
SUBJECT: Nigeria 2004 Special 301 Review on IPR 
Protection 
 
Ref: State 29549 
 
1. SUMMARY. Progress on IPR protection in Nigeria 
continues to be hampered by inadequate funding and poor 
public and government awareness.  Nonetheless, we do not 
believe Nigeria should be added to the Watch List because 
improvements, however small, are detectable, and any 
momentum would likely be lost with sanctions.  While the 
GON improved its position in the last year regarding its 
use of computer software, it has not yet paid licensing 
fees. Nigeria made slight improvements in the areas of 
optical media piracy and prosecution of IPR violations, 
but a lack of resources and training, coupled with low 
public and government understanding and appreciation of 
the benefits of IPR protection, leave enforcement weak. 
Industry and government representatives nonetheless 
attest to the GON's continued attention to IPR issues and 
incremental efforts to address piracy and improve 
enforcement.  END SUMMARY. 
 
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A. Optical Media Piracy 
----------------------- 
 
2. Nigeria remains a large market for a wide range of 
pirated optical media products. Pirated versions of CDs 
and VCDs abound for sale on the streets of Nigeria's 
urban centers. Much of the pirate disc industry is 
centered in a section of Lagos where several local 
optical media companies have the capacity to produce over 
500 copies of CDs, DVDs, and VCDs daily. 
 
3. The GON appears to have taken a step toward addressing 
this problem, but effective enforcement is stalled. We 
are told that the Nigerian Copyright Commission (NCC) now 
requires anti-piracy holograms to be included on optical 
media; however, a court injunction has put the 
prosecution of at least one case in jeopardy, as well as 
future enforcement of the hologram scheme. 
 
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B. Use/Procurement of Government Software 
----------------------------------------- 
 
4. Until recently, the GON was considered the largest 
abuser of IPR in that most, if not all, government 
offices used pirated software. In early 2002 President 
Obasanjo directed all ministries and parastatals to 
account for the software in their possession, and to 
regularize software usage.  In 2003 the National 
Information Technology Development Agency (NITDA), in 
coordination with the NCC, completed an audit of software 
in use by the government and negotiated license 
agreements with the software owners. 
 
5.  Microsoft reports that it has signed licensing 
agreements with most government and parastatal agencies, 
and considers this a major step toward legitimizing 
government usage of its software.  However, the GON is 
yet to pay the fees associated with the licensing 
agreements, and it is unclear when or if such funds will 
be appropriated. 
 
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C. TRIPS Compliance 
------------------- 
 
6. Nigeria is a signatory to the Universal Copyright 
Convention and the Berne Convention. In 1993, Nigeria 
became a member of the World Intellectual Property 
Organization (WIPO) and thereby became party to most of 
the major international agreements on intellectual 
property rights. The Patents and Design Decree of 1970 
governs the registration of patents; and the Standards 
Organization of Nigeria is responsible for issuing 
patents, trademarks, and copyrights. Once conferred, a 
patent conveys an exclusive right to make, import, sell, 
or use the products or apply the process. The Copyright 
Decree of 1988, based on WIPO standards and U.S. 
copyright law, makes it a crime to export, import, 
reproduce, exhibit, perform, or sell any work without the 
permission of the copyright owner. 
 
7. In 1999, amendments to the Copyright Decree 
incorporated most TRIPS protections for copyrights, 
except provisions to protect geographical indications and 
undisclosed business information. The amendment also gave 
the Nigerian Copyright Commission (NCC) additional 
enforcement powers. 
 
8. Four TRIPS-related bills and amendments have been 
under consideration for two years, but none have been 
forwarded to the National Assembly. The Ministry of 
Justice is reviewing their provisions.  According to the 
GON, the World Intellectual Property Organization (WIPO) 
reviewed the first three of the acts listed (all except 
the plant and animal variety legislation) and determined 
that their enactment would bring Nigeria into full 
compliance with TRIPS. 
 
--The Nigerian Copyrights Commission (NCC) and the 
Trademarks and Patents Registry (TPR) prepared a bill 
that would merge both agencies to establish an 
Intellectual Property Commission (IPCON). The draft law 
provides for the new commission to retain a part of the 
fees it would collect to fund operations and programs. 
 
--The Ministry of Justice is reviewing an amendment to 
the Patents and Designs Act that will make comprehensive 
provisions for the registration and proprietorship of 
patents and designs. 
 
--The Ministry of Justice is also reviewing an amendment 
to the Trademarks Act that will improve existing 
legislation relating to the recording, publishing, and 
enforcement of trademarks. 
 
--A bill to provide protection for plant varieties, 
including biotechnology, and animal breeds, was discussed 
by various agencies, but no progress has been reported. 
 
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D. Enforcement 
-------------- 
 
9. Law enforcement remains weak, and the judicial process 
is slow and subject to corruption. Inadequate funding of 
law enforcement and judicial functions is the major 
obstacle to effective enforcement of IPR laws.  Police 
and courts lack everything from staff and computers to 
vehicles and office supplies. 
 
10. Companies rarely seek trademark or patent protection 
because it is generally perceived as ineffective given 
the sad state of police and court infrastructure. 
Microsoft reports it pursued only one raid in 2003.  The 
company has made an effort to assist government IPR 
enforcers with logistical support, such as donating a bus 
for the movement of officers to the location of a raid. 
The company also reports that it has been asked for a 
wide variety of in-kind assistance, and it does not want 
to fall into a pattern in which it is expected to pay for 
the proper enforcement of Nigerian law.  It is unlikely 
that law enforcement will improve without assertive 
political leadership, policy direction, and perhaps most 
important, adequate financial support. 
 
11. Another key deficiency is an inadequate appreciation 
among regulatory officials, distributor networks, and 
consumers of the benefits of intellectual property rights 
protection. This is coupled with the fact that the 
average consumer price of legally produced or imported 
materials is beyond the reach of most Nigerians.  In 2003 
the managers and legal advisors of two banks charged with 
using unlicensed software convincingly claimed they 
simply didn't realize they were obligated to use licensed 
copies of computer operating systems. In another 
instance, two major insurance firms have been balking at 
pressure to pay licensing fees, each insisting that it 
will pay only after its competitor does so. 
 
12. Nigeria's over-stretched and under-trained police 
lack sufficient understanding of IPR. The Nigerian 
Customs Service has received some WIPO sponsored 
training, but even those officers who can identify 
pirated imports are not allowed, under the current law, 
to impound the offending materials unless the copyright 
owner has filed a complaint against that particular 
shipment, which is only done in very rare instances. 
 
13. IPR cases are handled primarily by the Federal High 
Court, whose judges generally have broad familiarity with 
IPR protection law. However, an appeal might not be 
handled by a knowledgeable judge, and misapplication of 
the law is not uncommon. Lagos is the only region in 
Nigeria where most judges have a reasonable knowledge of 
IPR. Further exacerbating the problem, most legal 
practitioners do not possess adequate knowledge of 
intellectual property rights to properly handle cases. 
 
14. Nigerian artists including writers, filmmakers, and 
musicians have in recent years campaigned for more 
effective copyright protection. Lawyers active in IPR 
issues formed the Industrial Property Law Interest Group 
(IPLIG) to educate the public and lobby on behalf of 
industrial IPR issues. IPLIG has sponsored copyright 
conferences and initiated an IPR course at the Lagos Law 
School. Software company representatives, represented by 
the Business Software Alliance (BSA), successfully worked 
directly with the Nigerian Government to stop its use of 
pirated software. Nigerian filmmakers formed the Proteus 
Entertainment Agency to challenge copyright infringement 
and promote stronger law enforcement. However, a member 
of a group called Musical Owners Rights Association of 
Nigeria (MORAN) is said to have obtained an injunction 
against his prosecution for pirating music in Abia State 
in Southeastern Nigeria, placing a hold on hologram 
enforcement. 
 
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RECOMMEND NO CHANGE IN STATUS 
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15. COMMENT. Although Nigeria is a large market for 
pirated goods, it should not be included in USTR's 
Special 301 Watch List. The GON is pursuing efforts to 
shore up its regulatory and legal framework. Overall, the 
GON continues efforts to improve IPR protection. 
President Obasanjo's commitment to ensure that GON 
agencies use licensed software proves the government is 
not oblivious to its obligations and maintains IPR among 
the issues of international importance it attempts to 
address.  Furthermore, since the Nigerian populace 
perceives that the value of its money has shrunk 
substantially over the last few years (which is, in large 
part, true), any move that would seem to place a higher 
burden on consumers would be intepreted as a cave-into 
U.S. policies and interests and hence would be greeted 
with animosity, if not outright hostility.  END COMMENT. 
 
ANYASO