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UNCLAS SECTION 01 OF 03 BRASILIA 001355 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE PASS USTR 
GENEVA FOR USTR 
STATE PASS USPTO 
USDOC FOR 4332/ITA/MAC/WH/OLAC/MWARD 
USDOC FOR 3134/ITA/USCS/OIO/WH/RD/SHUPKA 
 
E.O. 12958:  N/A 
TAGS: KIPR ECPS BR
SUBJECT: BRAZILIAN COPYRIGHT OFFICE SEEKS AN ALTERNATIVE PATH ON IPR 
ISSUES 
 
 
¶1.  (SBU) Summary.  Recently, Econ and FCS personnel met with 
officials at Brazil's Copyright Office (organizationally, located 
within the Ministry Culture) to discuss Brazil's emerging policy on 
IPR and digital inclusion issues.  This meeting was to follow-up on 
an earlier, June 7 session between U.S. Patent and Trademark Deputy 
Director Stephen Pinkos and counterpart Brazilian policy level 
officials.  Our interlocutors outlined the full array of challenges 
they faced, inter alia,  resistance within Brazilian domestic 
industry to paying royalties, bureaucratic and statutory obstacles 
to the  development of a balanced doctrine of "fair use," and, of 
course, rampant piracy.  (Notwithstanding Brazil's plethora of 
well-known musicians, because of copyright piracy, we were told, no 
more than 30 could make a living from musical royalties.)  The 
Ministry had established a network of cultural facilities which 
artists could use for free, provided they licensed any works 
produced there to the creative commons.  Internationally, our 
contacts complained of developed country dominance at the World 
Intellectual Property Organization (WIPO) and stated that the idea 
behind Brazil's proposed "Development Agenda" was to level the IPR 
playing field.  End Summary. 
 
¶2.  (SBU)  On June 28, FSC Deputy Senior Commercial Officer, Econ 
Counselor and Econ Assistant met with Marcel Alves da Souza, the 
head of the Ministry of Culture's Copyright Office, and Angeline 
Monteiro Prata, the Ministry's Copyright Manager, to learn more 
about the workings of that office.  Souza declared that the 
Copyright Office was besieged on all fronts as private industry 
sought to enforce its legal rights in the face of widespread piracy, 
while government policymakers (in particular Minister of Culture 
Gilberto Gil) actively worked to afford citizens greater access to 
informational materials.  Notwithstanding the Copyright Office's 
best efforts, it was becoming increasingly difficult to reconcile 
the conflicting demands, he stated. 
 
--------------------- ------------------ ------------------ 
Payments for Use of Copyrighted Songs in Audio-Visual Works 
--------------------- ------------------ ------------------ 
¶3.  (SBU)  Souza cited as an example the payment of fees to musical 
copyright holders when their works were used in domestic Brazilian 
films.  In such cases, a private sector organization, RECADE, he 
noted, was charged with collecting compensation from filmmakers. 
However, the film industry balked at paying such monies, arguing 
(incorrectly) that this was not the practice in the U.S.  Indeed, he 
continued, using that argument the film lobby had nearly gotten the 
Brazilian Congress to enact legislation withdrawing the legal 
requirement to pay compensation in these situations, though that 
effort had ultimately failed.  Further complicating the matter, was 
the lack of transparency of RECADE itself, with a number of artists 
alleging that it keeps for itself an undue share of the fees 
collected on their behalf. 
 
---------------------------------- 
Piracy and the "Fair Use" Doctrine 
---------------------------------- 
¶4.  (SBU)  Discussion then turned to the issue of the scope of the 
"fair use" doctrine in Brazil - i.e., the degree to which the public 
could use minor portions of a copyrighted work without paying 
royalties to the author.  Souza stated that while the vast 
disparities in income in Brazil militated in favor of an expanded 
"fair use" doctrine, in fact, Brazil, as was the case in many other 
Latin American countries, applied the concept more restrictively 
than in the United States.  Part of the problem, he observed, was 
that statutory code, rather than common law, governed on this issue, 
and even though the relevant statute had been enacted in 1998 in 
many ways it was already out of date.  The public's increasing use 
of the internet meant that the statute needed to be reworked.  To 
help tip the scales in favor of reform, he observed, the Ministry 
sought to organize civil society groups (like libraries) to lobby 
for greater "fair use."  However, the local IPR legal lobby 
vigorously opposed this, he noted, notwithstanding the fact that it 
 
BRASILIA 00001355  002 OF 003 
 
 
was practically impossible for rightholders to collect royalties for 
such small-scale activity. 
All that restricting the "fair use" doctrine did, he concluded, was 
make the public insensitive to the difference between minor copying 
and blatant piracy. 
 
¶5. (SBU)  The textbook example of this, Souza stated, was textbooks. 
 There were cases of enforcement entities catching students for 
small-scale copying while true pirates - i.e., those who xeroxed and 
sold entire textbooks - often got away scot free.  The GOB realized 
that if it could persuade the publishing industry to lower the price 
of school books, then it might be able to reduce the economic 
incentive for piracy.  Hence, the GOB eliminated valued added taxes 
on textbooks.  Yet, the tax cuts did not result in lower prices, 
Souza said, as the industry - noting the limited demand for 
Portuguese-language publications - argued that its high prices 
helped it cover high costs due to the lack of economies of scale. 
 
---------------------------------- 
Digital Inclusion and Cultura Viva 
---------------------------------- 
¶6.  (SBU) Souza noted that Minister Gilberto Gil was a strong 
advocate of accommodating intellectual property rights protection to 
"the needs of development."  In this vein, Gil has been outspoken on 
issues such as free software and digital inclusion of disadvantaged 
populations.  Domestically, one program which the Ministry has taken 
to implement this vision is "Cultura Viva," the principal element of 
which is the establishment of various cultural centers throughout 
the country where low-income artists could have access to studios, 
internet connections, and other production facilities.  Cultural 
centers have been set-up - through contracts with local NGOs - in 
such major cities as Sao Paulo, Rio de Janeiro, Salvador, and 
Brasilia.  The only requirement that the government levies on the 
use of such facilities is that the artist license whatever they 
produce to the creative commons.  The idea is that providing young 
artists a platform to create, Souza said, gives them the opportunity 
to gain recognition - which can then translate into market 
bargaining power.  The most notable works which have come from these 
cultural centers, he noted, have been innovative hip-hop routines 
produced in Rio. 
 
---------------------------- 
The GOB's Development Agenda 
---------------------------- 
¶7.  (SBU)  Souza, Brazil's representative at the World Intellectual 
Property Organization (WIPO), stated that the GOB felt that within 
that entity the deck was stacked in favor of the developed 
countries.  The rich nations, he intimated, were able to buy votes 
from the Third World by offering benefits like technical assistance 
or even travel money and per diem.  Hence, he said, the GOB and its 
emerging country allies, had formulated the "Development Agenda" to 
break the developed countries' hegemony over the discussion of IPR 
issues.  The "Development Agenda," he continued, was simply the 
international component of the GOB's overall efforts to make IPR 
policy more consistent with the needs of emerging nations. 
International copyright protection should not be absolute, he 
declared, and Brazil was intent on pushing this point in 
multilateral fora.  One example of how the status quo needed to 
change, he observed, was the treatment of translations.  Given that 
so few people in Brazil spoke English, he noted, the issue of 
protection of translated work had special significance for the GOB. 
Why should a translated work receive full copyright protection, he 
asked, if the copyright had already lapsed on the original work? 
 
------- 
Comment 
------- 
¶8.  (SBU) Though the positions Souza and Prata espoused were in line 
with the ruling PT party's stance on IPR, they took pains to make 
clear that they were non-partisan.  As civil servants, they would 
 
BRASILIA 00001355  003 OF 003 
 
 
likely remain in their jobs, they said, even if the opposition PSDB 
party (generally considered to be more business-friendly) were to 
prevail in the October 2006 election.  Indeed, in our chat with him, 
Souza declared that the "Development Agenda" would remain high on 
Brazil's priorities within WIPO for the foreseeable future. 
 
Williamson