US embassy cable - 05WELLINGTON334

UNCLAS SECTION 01 OF 02 WELLINGTON 000334 
 
SIPDIS 
 
STATE FOR EB/TPP/IPE-AAREIAS, INL/C-ASHANTI AND 
EAP/ANP-TRAMSEY 
 
E.O. 12356: N/A 
TAGS: KIPR, ECON, EFIN, ETRD, PREL, NZ 
SUBJECT: NEW ZEALAND: PROPOSAL FOR 2005 IPR TRAINING 
AND TECHNICAL ASSISTANCE PROGRAM 
 
REF: STATE 48295 
 
Post submits the following project proposal for the 2005 
Intellectual Property Rights (IPR) Training and Technical 
Assistance Program (reftel): 
 
The Recording Industry Association of New Zealand (RIANZ) 
and the Australasian Mechanical Copyright Owners Society 
(AMCOS) have set up a joint intellectual property 
enforcement unit for New Zealand and the South Pacific 
region.  Terence O'Neill-Joyce, RIANZ's outgoing president, 
has been running the unit on an ad-hoc basis since its 
inception in 1996.  In mid-2005, he intends to operate the 
unit on a full-time basis and to expand its activities. 
Post recommends that funding be considered for the unit's 
activities, such as its legal and training costs. 
 
Post believes this unit fills a gap in the efforts by New 
Zealand and South Pacific countries to fight music piracy. 
Most Pacific Island nations have no enforcement staff 
dedicated to protecting intellectual property rights.  The 
unit has three main objectives: intelligence, prevention and 
enforcement.  It is developing an intelligence framework to 
identify local producers of pirated works, distributors, 
criminal networks and recipients and to work with relevant 
government, law enforcement, customs and other authorities 
and stakeholders.  The unit aims to prevent piracy by 
sharing intelligence with other organizations and agencies, 
lobbying political parties and the judiciary on the harm to 
industry and supporting public awareness campaigns.  It will 
undertake enforcement operations targeting manufacturers, 
importers, distributors and sellers of illegal material. 
The unit also will train law enforcement and other agencies 
in the implementation of intellectual property legislation 
through identifying offenses and disrupting piracy 
activities. 
 
The unit is working on behalf of the composers, performers 
and producers represented by the Australasian Performing 
Right Association, AMCOS, RIANZ, Independent Music New 
Zealand, the New Zealand Music Industry Commission and the 
Fiji Performing Right Association.  The unit reports to 
those organizations' boards, but operates independently. 
Public and private sources within each country will fund the 
bulk of the unit's operating costs, with AMCOS and RIANZ 
funding now supporting one employee. 
 
Embassy Apia and Embassy Suva have reviewed this proposal 
and report that it does not conflict with their activities. 
 
1) Targeted to U.S. priorities. 
 
The project would be aimed not only at the rising piracy 
problem in New Zealand, but also in Pacific Island nations 
including Fiji, the Cook Islands and Samoa, whose 
governments have limited ability and resources to combat 
piracy. 
 
The region has received increasing numbers of pirated 
optical discs from Pakistan, Malaysia, Taiwan, Indonesia and 
China.  The music industry estimates the cost of piracy 
activity -- including illegal DVDs, CDs and Internet 
downloading -- to New Zealand and South Pacific governments 
to be NZ $14.25 million (US $10.3 million) in tax revenue. 
The overall loss to the industry was roughly NZ $50 million 
(US $36.2 million) last year in the region, a 30 percent 
increase from the previous year. 
 
2) Strong support of host government. 
 
In the WTO, APEC and other multilateral forums, the New 
Zealand government has professed a strong commitment to 
intellectual property crime enforcement efforts.  The South 
Pacific governments have expressed the desire to improve IPR 
enforcement, but also have pointed to their inability to do 
so because of a lack of funding and expertise. 
 
3) Addresses key gap in IPR enforcement. 
 
IPR enforcement is a task shared by a number of agencies in 
New Zealand that, in some cases, lack sufficient powers and 
resources to investigate and prosecute illegal traders.  New 
Zealand Customs, for example, does not have the power to 
prosecute, although it can confiscate and destroy pirated 
products.  Instead of criminal prosecutions, holders of 
intellectual property rights have to pursue relief through 
civil lawsuits.  Although the government is fully committed 
to enforcing its intellectual property laws, it lacks a 
central body to coordinate the sharing of information on 
illegal IP activities and enforcement efforts.  The 
intellectual property enforcement unit addresses these 
deficiencies. 
 
The unit also will oversee sharing of intelligence, 
expertise and training between New Zealand and the South 
Pacific countries.  The island nations would greatly benefit 
from an efficient sharing of resources made possible by the 
unit. 
 
4) Has capacity to achieve near term, measurable success, 
with metrics. 
 
The project's performance will be judged by specific 
milestones, including increases in the number of enforcement 
operations and seizures, with percentages or numerical 
targets re-set annually.  The unit also will be measured by 
the number of reports it submits to the International 
Federation of the Phonographic Industry (IFPI) on its 
contributions to IP protection and enforcement methodology. 
 
5) Has strong project oversight and accountability measures. 
 
The performance measures will be set at the start of each 
year and reviewed annually by the combined boards.  Working 
with the boards, Embassy Wellington will closely monitor the 
project and continually assess its strengths and weaknesses. 
 
6) Following is the estimated budget for the intellectual 
property enforcement unit for the first full year of 
operations: 
 
Total costs: NZ $533,000 (US $386,158) 
 
     Start-up costs: NZ $78,000 (US $56,510) 
 
     Salaries:      NZ $215,000 (US $155,768) 
 
     Operating costs: NZ $240,000 (US $173,880) 
 
Start-up costs (NZ dollars): 
     Furnishings                             $25,000 
     IT costs (equipment)                    $45,000 
     Sundries                                $8,000 
 
Salaries (NZ dollars): 
     Unit head                               $90,000 
     Intelligence and policy development     $60,000 
     Licensing and enforcement officer       $40,000 
     Administrative support                  $25,000 
 
Operating costs (NZ dollars): 
     Accommodations (rental, utilities)      $55,000 
     IT support                              $15,000 
     Legal costs (investigation, prosecution)$75,000 
     Training (internet piracy, law)         $50,000 
     Travel costs                            $35,000 
     Employer liabilities                    $10,000 
 
NOTE: In U.S. dollars, legal costs would be $54,338 and 
training costs would be $36,225. 
 
BURNETT