VZCZCXRO3408
RR RUEHDU RUEHJO
DE RUEHSA #0616/01 0521413
ZNR UUUUU ZZH
R 211413Z FEB 07
FM AMEMBASSY PRETORIA
TO RUEHC/SECSTATE WASHDC 8279
INFO RUEHJO/AMCONSUL JOHANNESBURG 6207
RUEHTN/AMCONSUL CAPE TOWN 3970
RUEHDU/AMCONSUL DURBAN 8590
RUEATRS/DEPT OF TREASURY WASHDC
RUCPDC/DEPT OF COMMERCE WASHDC

UNCLAS SECTION 01 OF 03 PRETORIA 000616 
 
SIPDIS 
 
SENSITIVE BUT UNCLASSIFIED 
SIPDIS 
 
DEPARTMENT PASS USTR FOR J. CHLOE GROVES 
COMMERCE FOR ITA/MAC/OIPR FOR C. PETERS 
EB/TPP/IPE FOR J. BOGER 
 
E.O. 12958: N/A 
TAGS: ECON ETRD KIPR SF
SUBJECT: SOUTH AFRICA INPUT FOR 301 REVIEW 
 
REF: A. STATE 07944 
     ¶B. 05 PRETORIA 03051 
 
¶1.  (SBU) Summary.  In response to Ref A, Post recommends 
that South Africa not be placed on the Special 301 Watch List 
for 2007.  Optical media piracy and counterfeit goods do pose 
a problem for the South African Government (SAG), but the SAG 
has made continuous efforts to combat this issue.  The SAG's 
creation of commercial crime courts that are able to focus on 
intellectual property rights (IPR), dedication of specialized 
prosecutors who deal solely with IPR crimes, and formation of 
the Department of Trade and Industry's (DTI) IPR 
investigative unit speaks to the SAG's interest in reducing 
IPR violations.  The SAG is receptive to both private sector 
and USG training and skills workshops to improve its 
enforcement efforts.  End Summary. 
 
---------------------------- 
LEGISLATION AND LEGAL ACTION 
---------------------------- 
 
¶2.  (SBU) South Africa's current IPR legislation is TRIPS 
compliant.  The Counterfeit Goods Act (CGA) and Copyright Act 
empower the South African Police (SAPS) and the DTI's IPR 
unit to investigate and pursue criminal convictions against 
IPR violators.  A recent court case in a Pretoria court 
limited the reach of the CGA by requiring warrants to include 
specifics about suspects that are often unknown if the 
suspected IPR violator is an ex-pat or illegal alien.  While 
this has momentarily stalled some IPR investigations, the 
South Africa Federation Against Copyright Theft (SAFACT) 
appealed this case, which is considered by those involved to 
be an anomaly.  The outcome of the appeal is expected in the 
first quarter of 2007.  (Note: Post will provide an update 
septel once the court's ruling has been issued.) 
 
---------------------------------- 
ACTION AGAINST IN-HOUSE PRODUCTION 
---------------------------------- 
 
¶3.  (SBU) In the past, South Africa mainly received pirated 
copyright products via Malaysia and Pakistan.  However, 
recent raids have revealed several small distribution centers 
with approximately 40 burners in place.  It is believed that 
Malaysia is still the point of origin for the original copy, 
usually a poor quality videocam taken at a movie theater. 
Although South Africa is still not considered a major point 
of production, SAFACT, in cooperation with SAPS, is focusing 
on increased raids for these distribution centers.  Customs 
continues to enhance its border inspections to halt import of 
pirated copyright material, as well as counterfeit goods. 
 
------------------------------- 
ENFORCEMENT EFFORTS ON THE RISE 
------------------------------- 
 
¶4.  (SBU) The SAG's enforcement efforts to date suffer from 
key problems including poor investigative skills and 
preparation of cases by SAPS, thereby making many cases 
unusable by prosecutors, a lack of expertise among the 
prosecutors, and a complacent attitude by magistrates towards 
IPR violations, resulting in an under-appreciation of the 
crime and reluctance to impose deterrent penalties.  In 
acknowledgment of these problems, the SAG is receptive to 
training and capacity building as top priorities, and 
continues to make improvements to its internal structures. 
According to local industry representatives, these efforts 
have improved IPR enforcement in South Africa. 
 
¶5.  (SBU) Enhancements at the magistrate level include 
creation of a commercial crime court, so that IPR crimes do 
not need to compete against the numerous violent crimes for 
magistrate attention, and the magistrate's ability to retain 
an IPR expert during trial to advise the magistrate on 
technical issues.  To improve prosecutor expertise, the SAG 
has dedicated two specialized prosecutors to IPR crimes only. 
 DTI has established an education section in its IPR 
division, which is tasked with training DTI investigators, 
SAPS, and the National Prosecuting Authority (NPA) regarding 
proper investigative techniques and docket preparation.  This 
has also resulted in more cross-agency communication on IPR 
enforcement efforts. 
 
¶6.  (SBU) Awareness of the seriousness of IPR crimes has also 
 
PRETORIA 00000616  002 OF 003 
 
 
led to higher deterrent penalties .  A recent court case 
against a counterfeiter of Unilever household goods received 
a five-year sentence, without the option to pay a fine.  The 
lengthy sentence of the criminal, who is linked to organized 
crime, was hailed by IPR organizations as a step forward in 
IPR enforcement. 
 
------------------------- 
TRAINING PROGRAMS WELCOME 
------------------------- 
 
¶7.  (SBU) As the SAG grapples with very real capacity 
problems associated with IPR enforcement, SAPS, NPA and DTI 
are open and receptive to USG, SAFACT, and other private 
organizations' offers to provide skill training.  In 2005, 
with INL funding, post and the Intellectual Property Action 
Group (IPACT) organized workshops in seven provinces on IPR 
enforcement.  The workshops raised awareness of the 
seriousness of IPR issues and more effective enforcement 
methods to some 244 prosecutors (Ref B).  In 2007, post, 
again with INL funding, is cooperating with the U.S. 
Department of Justice to provide a two-day advanced workshop 
in the three major cities for DTI investigators, SAPS 
commercial crime investigators, and prosecutors.  The course 
will provide advanced investigative techniques from the 
inception of a case through prosecution.  DTI has expressed 
interest in further programming in 2007/2008 to include 
magistrate training opportunities. 
 
¶8.  (SBU) Customs also plays a key role in IPR enforcement in 
South Africa, as the majority of counterfeit product seizures 
are made by customs officials.  Currently, there is little 
communication between SARS and SAPS, which can result in 
cases being dropped after the products are seized.  However, 
publicity on the dangers of counterfeit products, especially 
medicines targeting the HIV/AIDS market, has placed more 
attention on the importance of Custom's role in IPR 
enforcement.  Customs officials in the past year have begun 
to receive more awareness training by SARS, IPACT, SAFACT, 
and the American Chamber of Commerce. 
 
------------------ 
AWARENESS CAMPAIGN 
------------------ 
 
¶9.  (SBU) One of the often cited problems with IPR 
enforcement is the public's opinion that IPR is a victimless 
crime.  The Head of Customs, Leonard Radebe, has taken it 
upon himself to alter this public image.  In honor of World 
Customs Day, Radebe appeared on local news stations and 
penned an article for the daily paper explaining IPR crimes, 
their seriousness and impact, and the importance of the 
public joining the fight against IPR crimes by detecting 
counterfeit goods and reporting them to SARS.  Radebe listed 
all the SARS hotlines, as well as hotlines for the recording 
industry and SAFACT to promote public involvement in 
reporting IPR violations.  DTI is also in the initial phases 
of a university program to incorporate IPR awareness into the 
college curriculum.  DTI requested post's assistance with 
contacting U.S. professors or experts, who might be able to 
train local professors regarding the most modern IPR issues. 
Local artists, particularly musicians, have taken a 
high-profile stand on piracy, underscoring that South 
Africans suffer from the theft of intellectual property. 
 
---- 
WIPO 
---- 
 
¶10.  (SBU) The SAG was engaged in studying the WIPO treaties, 
but has not taken any action towards signing them.  At this 
point, the SAG's failure to be a party to the WIPO treaties 
has not caused a major impact on protecting IPR holders as 
Internet connections and capabilities in South Africa are 
limited and slow.  However, this will likely turn into a 
larger problem with the planned infrastructure upgrades for 
the 2010 FIFA World Cup, which include installation of a 
submarine telecommunication line, thereby making DSL high 
speed capability more common.  Pressure on SAG to move 
forward with signing the treaties is a recommended step for 
2007-2008. 
 
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COMMENT 
 
PRETORIA 00000616  003 OF 003 
 
 
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¶11.  (SBU) South Africa's focus on and effort in halting IPR 
violations is commendable given the current crime situation 
in South Africa, with heavy media and public attention on the 
high rates of violent crimes.  South Africa is cooperative 
with private sector IPR organizations in its efforts to 
improve its enforcement regime, continues to update its legal 
system to include courts, prosecutors, and commercial crime 
investigators that are more focused on IPR violations, and is 
initiating awareness campaigns to influence public opinion 
about IPR crimes.  Given these efforts and South Africa's 
interest in further cooperation with the USG on IPR issues, 
post recommends that South Africa remain off the 301 Watch 
List. 
BOST