VZCZCXRO0626
RR RUEHCHI RUEHDT RUEHHM
DE RUEHJA #3897/01 0831147
ZNR UUUUU ZZH
R 241147Z MAR 06
FM AMEMBASSY JAKARTA
TO RUEHC/SECSTATE WASHDC 1736
INFO RUEHZS/ASSOCIATION OF SOUTHEAST ASIAN NATIONS

UNCLAS SECTION 01 OF 03 JAKARTA 003897 
 
SIPDIS 
 
FOR EAP/IET, INL/C ASHANTI, EB/TPP/IPE EFELSING 
DEPT PASS TO USTR DKATZ, VESPINEL AND JGROVES 
 
SIPDIS 
 
E.O. 12598: N/A 
TAGS: KIPR ETRD ID
SUBJECT: INDONESIA: 2006 IPR PROJECT PROPOSALS 
 
REF: A. JAKARTA 3296 "Police Enforcement Continues" 
 
     ¶B. JAKARTA 3531 "Special 301 Submission" 
 
¶1.  Summary:  The tide is turning in a favorable direction 
on IPR enforcement in Indonesia.  A year ago, the IP 
industry, which was oddly cutting resources here, had marked 
Indonesia as the next hub for regional piracy and 
counterfeit syndicates.  However, contrary to such 
expectations, over the past six months, the reform-minded 
Yudhoyono Administration -- with USAID assistance and 
encouragement from our Trade and Investment Council (TIC) 
talks -- has begun an earnest effort to implement new 
optical disc regulations (ODR) and brought enforcement 
efforts to new levels.  One MPA regional representative 
describes recent events as "the most remarkable developments 
in Indonesia in the last six years."  In May 2006, two INL- 
funded ICITAP senior technical advisors will begin working 
with the Ministry of Industry and Police to assist further 
the Government of Indonesia's (GOI) ODR implementation and 
supporting police enforcement, an initiative both agencies 
warmly embrace.  If the success of the last year's limited 
USAID assistance to the Ministry of Industry is any 
indication, we expect these two full-time advisors and the 
GOI to accomplish much in the coming year.  But there are 
many enforcement challenges here, and we should not expect 
to solve them all in one year, nor should we plan to 
dramatically reduce our engagement and assistance at a time 
when we finally have serious GOI attention to this issue. 
As such, Embassy Jakarta requests FY 2006 funding for one 
senior IPR technical advisor to continue to support the 
Indonesian police and other agencies with IPR enforcement 
and ODR implementation for a second and final year.  End 
Summary. 
 
¶2.  In the past year, the USG has stepped up its engagement 
with the Government of Indonesia (GOI) on Intellectual 
Property Rights (IPR) protection through reinvigorated TIC 
talks and an IPR action plan.  For the first time in recent 
memory, the GOI has initiated a sustained and significant 
enforcement campaign, backed by high level GOI political 
support, against pirate vendors and factories. 
 
¶3.  The Ministry of Industry (MOI), with USAID and IP 
industry support, has established and provided preliminary 
training to an interagency optical disc (OD) factory 
monitoring team.  That team has registered nearly all of 
Indonesia's 22 known OD factories, issued SID codes, and 
started regular random and unannounced inspections. 
Following a late December directive from Indonesia Police 
Chief Sutanto to step up IPR enforcement, the police have 
worked with the IP industry to conduct sustained raids 
against street and mall vendors and factories.  Throughout 
the greater Jakarta metropolitan area alone, MPA 
representatives tell us police in February conducted 211 
raids, detained 145 individuals, and seized more than 
200,000 pirated optical discs.  Jakarta police informed us 
they have eighteen individuals under detention and awaiting 
prosecution for IPR infractions, including one factory owner 
from a February 9 raid.  IP industry reps tell us piracy 
levels in Jakarta are down by as much a 10 percent, and by 
as much as 60 percent in Surabaya, Indonesia's second 
largest city. 
 
¶4.  These are impressive developments given that a year ago, 
the IP industry, which was oddly cutting its resources here, 
had marked Indonesia as the next hub for regional piracy and 
counterfeit syndicates.  Still, there remains much work to 
be done, and it is important to safeguard and nurture the 
current positive momentum by building on USAID's efforts to 
establish and train the MOI-led OD factory monitoring team. 
 
¶5.  We are very grateful for two FY 2005 INL-funded ICITAP 
senior IPR technical advisors for Indonesia, both of whom 
will begin their engagements in May 2006.  One advisor will 
follow-up on USAID's recently-completed assistance efforts 
and provide full-time support for the Ministry of Industry 
OD factory monitoring team's efforts to implement a credible 
and effective factory monitoring regime.  The second advisor 
will provide full-time enforcement training and technical 
support to Indonesian National Police that will complement 
the efforts of the first advisor.  The GOI has warmly 
welcomed this initiative and we expect the two advisors to 
accomplish much in the next year. 
 
¶6.  However, in our judgment, it would be a mistake to 
dramatically reduce our engagement and assistance after one 
year when we have serious GOI attention to this issue.  As 
such, Embassy Jakarta requests FY 2006 funding to provide 
one senior IPR technical advisor to the GOI to continue to 
support the Indonesian police and other agencies with IPR 
 
JAKARTA 00003897  002 OF 003 
 
 
enforcement and ODR implementation for a second and final 
year.  Specifically, that advisor would build off the 
accomplishments of his two predecessors, collaborate further 
with police and what should be a fully operational OD 
monitoring team, and continue to focus more attention on 
training and advice for the Attorney General's Office and 
Courts in support of more prosecutions. 
 
IPR Enforcement and Prosecution Mentoring 
----------------------------------------- 
 
¶7.  The Indonesian police Special Economic Crimes Division 
has chief responsibility for IPR enforcement, including 
optical media piracy.  Indonesian prosecutors and the courts 
have a poor record for IPR prosecutions and, with the 
upswing in police enforcement activity, are quickly becoming 
a new center of focus.  (Note: Two Indonesian prosecutors 
attended a one-week USPTO course on IPR enforcement in the 
U.S. last month, and more are expected to attend an IPR 
enforcement seminar in Hong Kong in May).  The Ministry of 
Justice Directorate General for IPR nominally coordinates 
GOI IPR enforcement and awareness efforts.  Our advisor 
would be attached directly to the police, but would liaise 
and coordinate closely with all five agencies. Ideally, the 
senior advisor would have law enforcement and IPR 
investigative experience, preferably in Indonesia or 
Southeast Asia.  The IPR advisor's specific duties would 
include: 
 
-- Mentoring police on IPR investigation techniques, 
including technical training related to ODR implementation, 
identification of end-user piracy, and internet-related 
piracy. 
-- Cooperating closely with MOI optical disc factory 
monitoring team and IP industry representatives to identify 
unregistered factories and establish targets for factory, 
retail and end-use raids. 
-- Working closely with police investigators, the US DOJ 
Resident Legal Advisor (RLA) in Jakarta, and DOJ's new 
regional IPR Enforcement Coordinator to mentor prosecutors 
and ensure appropriate follow-on investigations and 
referrals of cases for prosecution. 
-- Developing closer cooperation on IPR enforcement between 
police, other agencies (i.e.: customs, MOI, Ministry of 
Trade, Ministry of Justice, Attorney General's Office and 
the Criminal and Commercial Courts). 
-- Developing effective and appropriate media awareness 
campaigns related to IPR enforcement. 
 
Existing USG Programming 
------------------------ 
 
¶8.  The FY2006 advisor would continue to complement other 
USG near-term USG assistance projects in the IPR area, 
include the following: 
 
-- USAID is providing up to USD 20 million to reform and 
strengthen Indonesia's specialized courts.  Emphasis will be 
on the Commercial Court, which has responsibility for IPR 
and bankruptcy cases, and on the Anti-Corruption Court. 
This effort will provide technical assistance to enhance 
administration; training to improve and expedite 
adjudication; and, hardware to modernize operations. 
According to IPR Industry representatives, most Commercial 
Court decisions on IPR cases, particularly trademark cases, 
have been decided correctly. 
 
-- DOJ/OPDAT, with USD 700,000 in INL funding, is providing 
a full-time U.S. Resident Legal Advisor (RLA) through 2007 
to work with the Indonesian Attorney General's Office.  The 
RLA is training Indonesian prosecutors and providing 
technical assistance, including that related to IPR, to 
Indonesia's Transnational Crime Task Force. We will also 
expect the newly appointed DOJ IPR Enforcement Coordinator 
in SE Asia, stationed in Bangkok, to support these efforts. 
The IPR Enforcement Coordinator, a DOJ prosecutor who will 
be visiting Jakarta in May, will become increasingly engaged 
in supporting law enforcement efforts in Indonesia.  The FBI 
legal attache at post may also provide additional 
opportunities to engage Indonesia police and prosecutors on 
IPR enforcement matters. 
 
-- Finally, the USG through USAID has a major new Trade 
Capacity Building project with Minister of Trade Marie 
Pangestu.  This three-year project assists the Ministry to 
build and strengthen its legal staff in order to more 
effectively and professionally engage in international trade 
dialogue.  The three year $15 million project is critical to 
enhancing the body of Trade Law, Regulation and Policy that 
will promote Indonesia's ongoing participation in regional 
 
JAKARTA 00003897  003 OF 003 
 
 
and global trade pacts, including to those related to IPR. 
 
Requested Funding 
----------------- 
 
¶9.  Based on estimates from DOJ/ICITAP, senior technical 
advisors require approximately USD 300,000 in basic funding 
per year.  Each advisor would need travel and training 
budgets.  Estimate travel costs are USD 5,000 for domestic 
travel and $20,000 for regional travel (including 
accompanying GOI officials).  The cost of four training 
sessions per year, including the use of foreign trainers, is 
approximately USD 40,000.  Therefore, to fund the project, 
Embassy requests USD 365,000 in INL FY2006 Intellectual 
Property Rights (IPR) Training and Technical Assistance 
Program funds.  DOJ/ICITAP representatives at post have 
agreed to assist in the administration of this project. 
 
PASCOE