US embassy cable - 03COLOMBO1386

UNCLAS SECTION 01 OF 02 COLOMBO 001386 
 
SIPDIS 
 
DEPT PASS TO USTR 
 
E.O. 12958: N/A 
TAGS: ECON, ETRD, KIPR, CE, WTO, USTR, ECONOMICS 
SUBJECT: SRI LANKAN PARLIAMENT PASSES NEW IPR LAW 
 
Refs: A)Colombo 1160, B)COLOMBO 257, C)02 Colombo 2196 
 
1.  Summary:  The Sri Lankan Parliament approved an 
Intellectual Property Rights (IPR) law on July 25, 2003. 
It will come into effect when the Speaker of the 
Parliament signs the bill, expected in August.  The new 
IPR law is WTO TRIPS compliant.  It provides for improved 
coverage, and contains provisions for an enhanced 
enforcement regime, which would address a major weakness 
in the existing law.  End Summary 
 
2. On July 25, the Sri Lankan Parliament approved a long- 
anticipated IPR law by a vote of 99-59. It will come into 
effect when the Speaker of the Parliament signs the bill, 
currently expected to happen in August.  Passage was 
delayed approximately two months by a court case, which 
resulted in amendments to allow compulsory licensing and 
parallel imports.  These amendments were required by the 
Supreme Court, which ruled that certain provisions in the 
bill on patents were inconsistent with the Constitution 
and violated fundamental rights of the people of Sri 
Lanka.  The petitioners, an AIDS activist and a think- 
tank, stated that the bill allowed patent owners, 
especially pharmaceutical companies, to control the 
supply and prices of drugs. 
 
3.  Parliamentary debate on the bill lasted two days.  On 
the first day, several Members of Parliament, including 
opposition members, generally spoke in favor of the bill, 
stressing the need to protect copyrights, especially of 
local artists.  On the last day of the vote, however, the 
opposition members of the People's Alliance and JVP 
opposed the bill, saying the bill should be re-published 
and presented for public comment again before 
parliamentary approval.  The opposition claimed the 
government was introducing several last minute changes, 
and alleged that the GSL was not carrying out the Supreme 
Court directions properly. 
 
4. The Government maintained that it was amending only 
the clauses suggested by the Court and there was no need 
for further delays.  According to the Director General of 
Intellectual Property of Sri Lanka, Dr. D.M. Karunaratne, 
the Attorney General had approved the amendments to the 
legislation, in accordance with the Court ruling. 
Karunaratne believes the opposition members did not fully 
understand the legal changes made in the bill. 
Government officials and other critics blame the 
opposition reaction on divisive politics rather than on 
any technical or legal grounds. 
 
5.  The new IPR law is WTO TRIPS compliant.  It protects 
and governs copyrights of artistic, literary and 
scientific work, related rights, industrial designs, 
patents, marks and trade names, layout designs of 
integrated circuits, unfair competition, undisclosed 
information and geographical information.  The 
preparation of the new law took years, under several 
governments, and was actively promoted by the Embassy and 
official USG visitors (see reftels).  Several US parties, 
including USAID consultants and the Motion Picture 
Association of America (MPAA), reviewed the draft law and 
provided comments.  Sri Lanka still needs to ratify and 
conform to the recent WIPO Performances and Phonograms 
Treaty (WPPT) and the WIPO Copyright Treaty (WCT). 
According to Dr. Karunaratne, certain provisions in the 
new law, such as communication to the public, conform to 
some provisions in these treaties, but not all. 
 
6.  The new law provides for an improved enforcement 
mechanism.  Currently, enforcement is a serious problem 
as is the lack of public awareness of IPR.  The 
Government does not act as an enforcer of IPR laws, 
partially due to weaknesses in the existing law.  For 
example, under copyrights, the previous law covered only 
the reproduction of works, not the sale, rental or export 
of counterfeits.  The new IPR law brings copyright law up 
to WTO and Bern Convention requirements, with expanded 
relief including powers to impound or destroy copies, 
packaging and implements used for making copies, and 
enhanced fines.  It also brings amendments to the Customs 
Ordinance, allowing Customs to detect import and export 
of counterfeit products, which will now be prohibited. 
At present, aggrieved parties must, on their own, seek 
redress of any IPR violation through the courts, often a 
slow process. 
7.  Local agents of reputed US and other international 
recording, software development and motion picture 
companies continue to complain that lack of IPR 
protection is damaging their businesses.  The Embassy, 
along with key industry players including the IFPI, 
continues to lobby for improvements in Sri Lanka's IPR 
regime.  The Embassy has convened a group of US companies 
adversely affected by IPR violations to engage the 
government on enforcement and to enhance public 
awareness. 
 
Entwistle