This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 03 BRASILIA 001978 
 
SIPDIS 
 
STATE PASS USTR -- YANG 
NSC FOR CRONIN 
AID FOR LAC/SA 
TREASURY FOR OASIA - DAS LEE AND FPARODI 
USDOC FOR 4332/ITA/MAC/WH/OLAC/JANDERSEN/ADRISCOLL/MWAR D 
USDOC FOR 3134/ITA/USCS/OIO/WH/RD/DDEVITO/DANDERSON/EOL SON 
JUSTICE FOR CCIPS 
DHS FOR ICE CYBER CRIMES CENTER 
 
E.O. 12958: N/A 
TAGS: KIPR ETRD IPR
SUBJECT: July 12 U.S.-Brazil IPR Technical Cooperation 
Meeting 
 
Refs:  A) Brasilia 487 (Notal)  B) Brasilia 599 
 
¶1.   Summary and Introduction.  On July 12, a team from 
USDOJ's Computer Crime and Intellectual Property Section 
(CCIPS), the Department of Homeland Security's Immigration 
and Customs Enforcement (ICE) Unit, and USTR met with 
counterparts from the Ministry of Justice, Federal Police, 
Receita Federal and Foreign Ministry for the first meeting 
under an informal technical cooperation initiative on IPR 
enforcement.  The technical cooperation initiative is a by- 
product of discussions with the GoB over the last year 
regarding the possible withdrawal of Brazil's trade benefits 
under the Generalized System of Preferences (GSP) due to 
ineffective copyright protection (ref A).  On April 4, the 
GSP Review was extended until September 30, 2005.  While the 
threat of the GSP Review has remained in place, the USG has 
also sought since April to foster a bilateral exchange 
between law enforcement and customs agencies specifically to 
support a timely implementation of Brazil's recently 
formulated national anti-piracy plan (ref B).  End Summary 
and Introduction. 
 
¶2.  The U.S. delegation was led by Christopher Merriam, 
International Coordinator for CCIPS and included Jason Gull, 
a trial attorney with CCIPS; Elizabeth Perino, Section Chief 
of the ICE Cyber Crimes Center; and Leslie Yang, USTR 
Director for Mercosul; representatives from AmEmbassy 
Brasilia Econ, DHS, Legatt, and FCS also attended.  Heading 
up the Brazilian Delegation was Marcio Costa de Menezes e 
Goncalves, Executive Secretary of Brazil's National Anti- 
Piracy Council (CNCP).  He was joined by Valquiria Teixeira 
and Adauto Martins of the Federal Police; Mauro Brito, head 
of a specialized enforcement section within Receita 
Federal's customs unit; Lilian Pinho, of the Public 
Prosecutor's office in the state of Rio de Janeiro; and 
Otavio Brandelli and Joao Storti of the Foreign Ministry. 
 
¶3.  The discussions focused on three subject areas 
identified during a June 1 bilateral digital video 
conference: risk analysis relating to customs, cybercrime, 
and legislative initiatives. 
 
Risk Analysis - Customs 
----------------------- 
 
¶4.   Brito noted an interest in working with other countries 
to obtain information that would enhance Brazilian customs' 
ability to evaluate the risk associated with particular 
importers and exporters.  Yang noted that some countries 
have set up a registry to identify legitimate importers of 
blank CDs.  Goncalves said the CNCP was considering 
establishing one central office for registration of 
copyright titleholders to enable better coordination between 
right-holders and law enforcement.  Brito also said customs 
would like to work more closely with the United States and 
other countries to address under-invoicing.  The Deputy DHS 
Attache encouraged Brito to use a bilateral cooperation 
agreement between Brazilian customs and DHS as a vehicle for 
seeking information that would be useful in their efforts. 
It was agreed that the subject of risk analysis would be 
taken up in greater detail during subsequent discussions. 
 
¶5.   Brito also outlined Receita Federal's customs 
modernization plan, including plans to improve 
infrastructure and increase the use of technology, such as 
scanners and optical character reading cameras, to enhance 
customs' ability to regulate the entry of products.  In 
March 2005, Brazilian customs established a special 
coordination unit for inspection oversight, establishing 
five separate sections to deal with: international trade 
related duties, enforcement (smuggling), classification of 
goods, risk analysis, and security.  According to Brito, the 
special enforcement unit is slated to grow from 200 to 1,000 
officers within two years, and by the end of three years it 
should be sufficiently large to deploy throughout the entire 
country.  In addition to using scanners, the unit will have 
an aviation team outfitted with planes, helicopters and 
speedboats.  Brazilian customs has also been exploring tax 
evasion control measures, such as the application of seals 
or serial numbers for CDs and DVDs, but is still discussing 
the issue with domestic industry which has not yet supported 
the approach. 
 
Cybercrime 
---------- 
 
¶6.  The Brazilian delegation displayed an intense interest 
in discussing an array of issues related to the protection 
of intellectual property and the internet.  Teixeira of the 
Federal Police said that although formally a new unit within 
the Federal Police to combat cybercrime has not been formed, 
it is functioning in practice and she requested that an 
informal channel of communication be established between 
Brazilian and U.S. authorities to enable quick communication 
for time sensitive inquiries.  The U.S. delegation welcomed 
direct inquiries to CCIPS and ICE from Brazilian 
authorities, but noted that inquiries directed through 
either the DHS or Legatt offices at post would probably be 
the most expeditious approach, particularly given language 
differences. 
 
¶7.  During the meeting, information was exchanged regarding 
internet service provider (ISP) liability within the U.S. 
and Brazilian legal systems, legal processes and mechanisms 
for securing evidence, difficulties and potential options 
for determining domain name ownership, and problems with the 
improper use of trademarks within worldwide web domain 
names.  The Brazilian delegation requested copies of 
pertinent U.S. legislation for reference as further changes 
in Brazilian laws are contemplated; they described current 
legislation as not very advanced. 
 
¶8.  Goncalves explained that Brazilian sellers of 
illegitimate products over the internet are increasingly 
acquiring domain names abroad to avoid penalties within 
Brazil.  Merriam noted that a substantial portion of 
enforcement in the United States is as a result of civil 
action.  The difficulty of monitoring service providers and 
auction sites for the sale of counterfeit goods was 
discussed, but the U.S. delegation also pointed out that 
auction sites are a resource for information useful for law 
enforcement.  In general, the U.S. delegation described the 
benefits of working in partnership with the large service 
providers and auction sites, which have a self-interest in 
denying access to purveyors of pirated goods, and U.S. law 
enforcement's focus on smaller providers who may be actual 
collaborators in criminal activity.  The U.S. delegation 
explained that U.S. law distinguishes between an attempt by 
a domain name holder to extort a trademark owner, which is 
illegal, and the legal use of trademarks in domain names if 
for the purpose of education or comparison. 
 
¶9.  Both sides conveyed an interest in continuing the 
discussion in this area.  Merriam encouraged the Brazilian 
delegation to forward any questions they have in writing in 
order to keep the dialog going and to increase the 
productivity of a future meeting. 
 
Legislative Initiatives 
----------------------- 
 
¶10.  Brandelli provided an overview of changes to Brazilian 
IPR law in recent years, including the ability to hold 
owners of buses used to transport counterfeit goods as 
liable and the elimination of customs-free transit for blank 
CDs through Brazil to Paraguay.  Another change has enabled 
a copyright association to be considered an "associated 
party" within legal proceedings.  Pinho claimed that 
copyright enforcement problems stem not so much from a need 
to change legislation, but from a lack of consistent 
application of the existing law.  One change being 
considered to Brazilian law would enable law enforcement to 
retain only a sample of counterfeit products seized, either 
destroying or donating the remainder.  In response to a 
question from the Brazilian side, the U.S. delegation 
explained that by working closely with right-holders, U.S. 
law enforcement typically is able to determine definitively 
before seizure that the products are in fact counterfeit. 
The quantity and monetary damage thresholds of the U.S. 
criminal copyright law were also explained. 
 
¶11.  Although not directly related to legislation, Pinho 
described how state level prosecutors have organized to 
standardize operations, procedures and penalties to address 
organized crime and her efforts to apply this same model for 
organizing state prosecutors to combat piracy.  Pinho said 
she is drafting a handbook for use by civil, military, 
highway, state, and federal police as well as customs agents 
to explain techniques for recognition, surveillance, and 
intelligence gathering related to piracy. 
 
Next Steps 
---------- 
 
¶12.  At the conclusion of the meeting, both sides described 
the discussion as very useful and expressed an interest in 
continuing the dialog, although no date was set for a future 
meeting.  Post continues to believe that this type of 
exchange provides the USG with a useful mechanism for 
engaging the GoB in a productive way on its efforts to 
combat piracy and to potentially make a positive impact on 
implementation of the GoB's national anti-piracy action 
plan. 
 
¶13.  This cable was cleared by the U.S. delegation. 
 
Manganiello