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

241057Z Feb 06

UNCLAS SECTION 01 OF 03 PARIS 001137 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR EB/TPP/IPE( CLACROSSE, JOELLEN URBAN) 
DEPT PLS PASS USTR FOR JENNIFER CHOE-GROVES, JIM SANFORD 
COMMERCE PLEASE PASS USPTO 
 
E.O. 12958: N/A 
TAGS: KIPR ETRD ECON FR
SUBJECT: FRANCE: SPECIAL 301 REVIEW YEAR 2006 
 
 
NOT FOR INTERNET DISTRIBUTION 
 
Summary 
------- 
 
¶1.  (SBU) In 2005, the French government stepped up its 
efforts to combat counterfeiting and piracy.  In particular, 
2005 was marked by an increase in joint activities with 
French companies and cooperation between the government and 
the private sector.  The GOF has also worked closely with 
the private sector on a series of regular public information 
campaigns.  The GOF is also currently working on a new 
version of its digital copyright draft bill to lessen 
original restrictions on CD and DVD copying and stem the 
ensuing political upheaval.  The revised draft bill should 
be before Parliament on March 7-10.  End Summary. 
 
Government Actions 
------------------ 
¶2.  (SBU)  The French government estimates that 
counterfeiting and piracy drain 6 billion euros annually 
from France's economic growth and costs 30,000 lost jobs. 
Recognizing that it will take a serious and long-term effort 
to stop the problem, the French Government has continued to 
implement its eleven-point plan against counterfeiting, 
launched by then-Economy and Finance Minister Nicolas 
Sarkozy in 2004.  France is particularly exposed to imports 
of counterfeit products (especially luxury goods) as 17 
percent of all counterfeit goods end up here.  Highlighted 
measures of France's efforts include: 
 
-- Customs and Seizures: The elaboration of a national plan 
with the GOF's customs administration, focusing on yearly 
objectives for the interception and seizure of goods.  The 
objective for 2005 was to seize 4 million counterfeit 
articles, a ten percent increase over 2004.  Almost 72 
percent of all seized goods come from Asia, mostly China, 
but also India for pharmaceutical drugs, and Pakistan for 
textiles.  Counterfeited goods from Turkey and Italy are on 
the way down.  However, France has become a producer of 
counterfeit goods, representing 6 percent of all seized 
items.  Some 44 percent of all seized goods are destined for 
the French market, and another 26 percent for Africa (a 
figure constantly on the rise).  Textiles represent 16 
percent of all seized goods, compared with 25 percent in 
¶2003.  The other significant category is "luxury goods," 
which represents another 8 percent. 
 
-- Public Awareness: The organization of regular public 
education campaigns to increase awareness of the full social 
and economic costs of counterfeiting and piracy as well as 
the safety and health risks incurred.  The Industry Ministry 
has earmarked 5 million euros in 2005 for such campaign, a 
ten-fold increase over a year ago.  The campaign was 
organized by the National Anti-Counterfeiting Commission, 
together with the French Patent Office (INPI), French 
Customs and the Competition and Consumer Affairs and Frauds 
Office of the Ministry of Economy, Finance and Industry 
(DGCCRF-Direction Generale de la Concurrence, de la 
Consommation et de la Repression des Fraudes). 
 
-- Prosecution: To discourage possible IP rights infringers, 
France has increased fines and prison terms.  IP rights 
infringers may now be sentenced to three years of 
imprisonment and be subject to fines of up to 300,000 euros 
(instead of 150,000 euros).  In trademark infringement 
cases, imprisonment may now go up to four years and fines up 
to 400,000 euros.  If the counterfeiting is the act of an 
organised group, the sentences may be even higher. 
Furthermore, the Ministry of Justice recently sent out 
guidelines to magistrates and public prosecutors to guide 
them in evaluating damages to be awarded to companies. 
 
-- Network of Experts: A inter-agency network of experts in 
all the ministries concerned has been set up to assist 
companies in enforcing their rights in the counterfeiting 
countries. The GOF has also maintained its 4 IP advisors co- 
located in French Embassies overseas such as China, Russia, 
Thailand etc. 
 
-- Customs Training: France will shortly implement the 
European eMAGE project, an Internet-based service, providing 
easy and real-time multilingual access to databases of 
trademarks and industrial designs designed to help customs 
authorities looking for counterfeit goods.  French Patent 
Office INPI heads the consortium developing the eMAGE 
program. 
 
-- Expanded Authority: As part on the implementation of an 
April 29, 2004 Directive on the enforcement of Intellectual 
Property Rights and a EU Council regulation 1383/2003 
extending the scope of IP rights holders, the GOF will 
extend to counterfeiting  the powers two offices of the 
French Economy, Finance and Industry Ministry: Tracfin, in 
charge of fighting fraudulent financial circuits, and 
DGCCRF, which handles competition, consumer and fraud cases. 
The GOF will further introduce professional training for all 
law enforcement and government officials dealing with 
counterfeiting. 
 
Public-Private partnership 
-------------------------- 
¶3.  (SBU)  Last November, France hosted the Second Global 
Congress on Combating Counterfeiting and Piracy, convened by 
Interpol and the World Customs Organization (WCO), whose 
Secretary General, Michel Danet, is a former senior French 
 
SIPDIS 
customs official.  The Congress approved the initiative by 
the Paris-based International Chamber of Commerce (ICC) to 
launch the Business Action to Stop Counterfeiting and Piracy 
(BASCAP) in order to increase public and political awareness 
of the economic and social harm associated with 
counterfeiting and piracy.  In a separate meeting, BASCAP 
participants, including CEOs from around the world 
representing the food and drink, pharmaceutical, textile, 
home products, finance, television, software and music 
sectors, agreed on an action plan.  The purpose of the plan 
is to establish counterfeiting and piracy indices, and 
compile case studies and statistics -- the first global, 
cross-sector study -- of the counterfeiting and piracy 
problem. 
 
¶4.  (SBU)  Such business initiatives are not uncommon in 
France, where the public sector has developed a close 
working relationship with government officials.  The Union 
of French Manufacturers ("Union des Fabricants" or 
"UNIFAB"), the most important private anti-counterfeiting 
organization in France, spearheaded France's push for 
stiffer IP laws and greater awareness of the problem of 
counterfeiting and of its ramifications with organized 
crime.  Working hand-in-hand with the government's National 
Anti-Counterfeiting Committee, UNIFAB signed a partnership 
charter in July 2005 with several towns in the South of 
France (including Marseilles, Cannes, and Nice) to intensify 
the struggle against the upsurge of counterfeit goods in the 
region, which largely come through Italy.  Earlier, UNIFAB 
had organized the 9th French edition of the Global Day 
against Counterfeiting. 
 
¶5.  (SBU)  UNIFAB is also pushing for another controversial 
bill currently before Parliament, the Digital Copyright 
bill, also known as the Copyright and Related Rights bill or 
DADVSI ("Droits d'Auteur et Droits Voisins). 
 
Combating Piracy on the Internet 
-------------------------------- 
¶6.  (SBU)  The French Government is reworking its digital 
copyright protection bill designed to comply with a 2001 EU 
Directive on digital piracy.  The GOF faced a political 
crisis in December 2005 in trying to gain passage of this 
bill, when lawmakers rebelled by endorsing amendments to 
legalize the online sharing of music and movies instead of 
punishing it.  Under the original proposals, those caught 
pirating copy-protected material would have faced USD 
360,000 in fines and up to three years in jail. 
 
¶7.  (SBU)  The amendments voted would legalize file-sharing 
by anyone paying a monthly royalties duty estimated at USD 
8.50.  The vote by members of France's lower house dealt a 
setback to Culture Minister Renaud Donnedieu de Vabres, who 
had introduced the draft legislation and who disavowed the 
legislature's actions.   Music labels and movie 
distributors, including the French music composers' and 
publishers' organization SACEM, have suggested the 
amendments would break international laws on intellectual 
property.  French consumer groups, on the other hand, 
claimed the plan would create a "new area of freedom 
allowing Internet users access to cultural diversity and 
fair payment for creators." 
 
¶9.  (SBU)  As a result, the GOF under  Prime Minister 
Dominique ordered the withdrawal of the bill to be amended 
to reinforce the right of consumers to make private copies 
of music and film disks.  It would also make a distinction 
between people illegally downloading for profit and the 
estimated eight million individuals in France who 
occasionally add to their music and movie collections via 
Internet peer-to-peer sites. 
 
¶10. (SBU)  The new draft bill has not been made public. 
According to the French press, however, changes include a 
phased penalty system for small-time downloaders, starting 
with a warning e-mail, then a formal letter and finally 
fines ranging from 300 euros to 1,500 euros.  Commercial 
downloaders would face up to three years in prison and a 
fine of up to 300,000 euros. 
 
¶11. (SBU)  Private users who have bought music or movies, 
whether on CD or DVD or online would have the right to make 
a small number of copies according to the French press. 
Currently, many disks, especially movie DVDs, have digital 
blocks to prevent copying, and those would have to be 
changed if the French bill becomes law.  The previous French 
government bill would have made it illegal to hack those 
blocks, as is the case in the United States under that 
country's Digital Millennium Copyright Act.  Under the 
proposed new bill, a consumer who broke such protection 
would not be prosecuted. And someone who copies a friend's 
disk would face only a 150-euro fine.  However, those trying 
to make money off such activities or publish hacker how-tos 
to get around the blocks would face a year in prison and 
fines of up to 100,000 euros. 
 
¶12. (SBU)  The government is allegedly looking at ensuring 
that all music sold on Apple's iPod site be playable on MP3 
players other than Apple's best-selling iPods, which is not 
currently the case. The French press has hinted that Apple's 
Music Store in France would also have to be changed under 
the new amendments. 
 
¶13. (SBU)  The debate in Parliament on the digital copyright 
bill will resume in all likelihood between March 7 and 10. 
The bill requires a one-time reading 
by each house to become law, under the emergency procedure 
invoked by the government. 
Stapleton