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DE RUEHTL #0112/01 0521310
ZNR UUUUU ZZH
R 211310Z FEB 07
FM AMEMBASSY TALLINN
TO RUEHC/SECSTATE WASHDC 9546
INFO RUCPDOC/USDOC WASHDC
RUEHZL/EUROPEAN POLITICAL COLLECTIVE

UNCLAS SECTION 01 OF 04 TALLINN 000112 
 
SIPDIS 
 
DEPT FOR EB/TTP/IPE BOGER, FOR EUR/NB GROVES 
DEPT PLEASE PASS TO USTR FOR LMOLNAR 
DOC FOR PETERS 
DOC PLEASE PASS USPTO 
 
SIPDIS 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: ETRD KIPR ECON EUR EN
SUBJECT: ESTONIA: VOLUNTARY INPUT FOR 2007 SPECIAL 301 
REVIEW 
 
REF: A) STATE 7944 B) 06 TALLINN 424 C) 07 TALLINN 66 
 
D) 06 TALLINN 156 
 
¶1.  Summary: In 2006, the GOE continued to improve the 
country's intellectual property rights (IPR) regime 
through legislative changes and cooperation with rights 
holders. The long-awaited new Civil Procedure Act that 
provides for ex parte searches came into force January 
1, 2006. On June 14, 2006, the Estonian Parliament 
ratified the World Phonogram Producers Treaty and the 
World Copy Right Treaty. The year also witnessed new 
cooperation initiatives between law enforcement 
agencies and industry.  While traditional forms of 
piracy continued to decrease, internet piracy in tech- 
savvy Estonia is an ever-growing concern that calls for 
better training of law enforcement agents.  End 
summary. 
 
--------------------- 
¶A. NOTORIOUS MARKETS 
--------------------- 
 
¶2.  There are no notorious markets for counterfeited 
goods in Estonia.  Smaller collections of shops near 
the harbor and in other parts of Tallinn still exist 
which continue to sell pirated CDs alongside legitimate 
goods.  Pirated CDs are seized at shops like these 
occasionally. (See para 14). 
 
------------------------------------------ 
¶B. Optical Media Piracy (CDs, VCDs, DVDs) 
------------------------------------------ 
 
¶3.  In 2006, optical media piracy in Estonia continued 
to decline.  The days of large-scale trade in pirated 
materials are long gone.  Post's Economic Specialist 
made several visits in 2006 to markets near the harbor 
area which cater largely to Finnish tourists.  On these 
occasions, she observed card tables trading CDs, 
videos, and DVDs at relatively high prices.  While it 
is possible that some of these items may have been 
pirated, such vendors are also known to sell legitimate 
copies.  According to a local anti-piracy NGO, the 
Estonian Organization for Copyright Protection (EOCP), 
the physical market for pirated audio-video items has 
decreased significantly, including around the harbor 
area, which over the past year has been under special 
police surveillance. 
 
--------------------------------------------- ------ 
B.1. INTERNET PIRACY AND COOPERATION WITH RIGHTS 
HOLDERS 
--------------------------------------------- ------ 
 
¶4.  In 2006, the Internet continued to be the biggest 
IPR challenge in Estonia, as in other countries with 
well-developed IT sectors. While optical media piracy 
has shown a vast decline in the past few years, the 
internet has become the most troublesome outlet for 
pirated material in Estonia, especially File Transfer 
Protocol (FTP) servers and peer-to-peer (P2P) systems. 
EOCP has entered into memorandums of understanding 
(MOU) with ten major Internet Service Providers (ISPs). 
Five of the MOUs were signed in 2006, including with 
ISPs in Northeast Estonia, where a large number of the 
consumers of Russian language media are located.  While 
these MOUs allow for the removal of illegal copyrighted 
materials from public FTP servers, there are still 
small, local ISPs that offer server services to swap 
music, film and software files.  In 2006, the EOCP 
closed 2,080 web sites and removed 29,676 files (in 
2005, 232 websites and 3136 files were removed).  In 
May, the EOCP closed down one of the biggest locally 
administrated websites that offered direct links to 
pirated music.  However, most of the music files were 
stored on foreign servers.  In August, the EOCP closed 
two major illegal software forum sites that offered 
direct download links to music, movies and interactive 
games.  Despite the cooperative efforts of industry, 
police and local ISPs, internet piracy remains a 
significant problem.  File sharing and peer-to-peer 
networks such as KaZaA, StreamCast, E-Donkey, E-Mule, 
and BitTorrent remain the largest sources of internet 
piracy in Estonia.  These networks are all located 
geographically outside of Estonia. 
 
TALLINN 00000112  002 OF 004 
 
 
 
------------------------------------------ 
¶C. Use/Procurement of Government Software 
------------------------------------------ 
 
¶5.  The use of software in government offices is in 
compliance with national and international copyright 
standards.  According to the GOE Informatics Center, 
every government office has designated a person/section 
to be responsible for information systems, including 
procurement and development of software. The GOE 
implements rules and regulations for government 
software procurement. 
 
--------------------------------------------- ----- 
¶D. TRIPS compliance, FTA Implementation and Other IPR 
Related Issues 
--------------------------------------------- ----- 
 
¶6.  Estonia continues to make progress on promulgating 
IPR-related legislation.  On January 1, the long- 
awaited legislation on ex parte searches encoded in the 
new Civil Court Procedure Act (CCPA) came into force. 
Major changes to the IPR penal policy were introduced 
by the Amendment Law to the Penal Code (ALPC) which 
passed two readings in 2006 and was adopted by the 
Parliament on January 24, 2007.  The ALPC classifies 
trade in pirated copies as a crime even when it occurs 
for the first time - previously it was only a 
misdemeanor.  However, according to the ALPC, the use 
of a pirated copy for a public performance or public 
display of the work or for communication is a 
misdemeanor, unless committed for commercial purposes. 
This classification may pose major difficulties for the 
investigation of IPR crimes in the digital environment. 
Under Estonian legislation, no criminal procedures such 
as the use of undercover officers and surveillance can 
be used when investigating misdemeanor acts.  The ALPC 
will come into force on March 15, 2007. 
 
¶7.  In 2006, the IPR Expert Committee of the Ministry 
of Culture (MOC) proposed a process for promulgating a 
new Copyright Act.  The current Copyright Act dates 
from 1992, and has been amended 20 times.  The aim of 
the new legislation is to harmonize the language, 
restructure the Articles, and to strengthen copyright 
protections for Soviet-era authors.  Observers expect 
language for the new legislation to be complete by 
¶2008. 
 
¶8.  In 2006, two optical disc plants continued their 
production in Estonia: 'Digibox' in Tartu, and the 
Lithuanian-based Baltic Optical Disc (BOD) plant in 
Tallinn. The managers of the companies have declared 
that their activities fully comply with the copyright 
laws, they work very closely with IPR organizations, 
and they are actively involved in anti-piracy actions. 
The International Federation of the Phonographic 
Industry (IFPI) has taken samples of the molds of the 
CD/DVD lines of both of the plants located in Estonia 
and provided them with mold Source Identification Codes 
(SID). 
 
¶9.  While Estonia has no legislation mandating the use 
of SIDs on locally manufactured CDs, BOD and Digibox 
have each entered into civil agreements with the Nordic 
Copyright Bureau (NCB) on IPR protection.  According to 
the EOCP, such civil agreements between IPR 
organizations and producers have proven to be very 
effective.  While source identification in Estonia is 
regulated by civil agreements, the GOE does not 
anticipate making SID provisions mandatory by law. 
According to the Ministry of Culture however, the GOE 
will consider this step if the production situation 
changes in Estonia. 
 
------------------- 
¶E.  DATA PROTECTION 
------------------- 
 
¶10. Not applicable in the Estonian market. 
 
--------------------------------------------- ------- 
¶F.  PRODUCTION, IMPORT AND EXPORT OF COUNTERFEIT GOODS 
--------------------------------------------- ------- 
 
TALLINN 00000112  003 OF 004 
 
 
 
¶11.  Recent seizures of pirated CDs at local shopping 
centers show that there is some domestic supply in 
Estonia.  However, law enforcement agencies as well as 
anti-piracy groups consider Estonia more a transit 
country than a source country for counterfeit goods. 
According to Estonian Customs, most of the IPR- 
infringing goods that have been detected have been in 
transit to Russia.  Only a small quantity of IPR- 
infringing goods was transported from Russia to the 
European Union customs territory through Estonia via 
'suitcase piracy'. 
 
----------------- 
¶G.  ENFORCEMENT 
----------------- 
 
¶12.  In 2006, the Estonian Tax and Customs Board 
detected counterfeit trademark goods in 106 cases, 
detaining 97,698 items in total.  The biggest cases 
involved spare parts for cellular telephones (Nokia, 
Alcatel, Siemens, Ericsson), in which authorities 
seized some 45,819 items.  Also, clothes with 
counterfeit trademarks form another big category in 
Estonian Customs' fight against IPR infringement.  In 
2006, they seized 31,334 of these items.  However, 
according to our interlocutors, rights holders rarely 
initiate legal proceedings in cases where only small 
quantities of their own goods are detected.  The 
industry considers the proceedings too time-consuming 
relative to the perceived benefit of pursuing such 
cases. 
 
¶13.  Local industries have made some progress 
submitting annual applications to Customs which allow 
Customs to seize suspected pirated goods on their 
behalf.  (Note:  These applications are required in 
accordance with European Council Decision number 
1383/2003 of July 2003.  End Note.)  To date, about 300 
applications have been submitted, the vast majority of 
which come from trademark representatives.  While EOCP, 
representing music and film industry, has submitted 
applications for some companies, a number of them have 
expired.  The Business Software Alliance has not 
submitted any applications.  Without such applications, 
Estonian Customs can only seize suspected goods for 
three days, which is generally insufficient time to 
determine if the goods are pirated or counterfeit. 
 
¶14.  In 2006, Estonian Police seized 4,234 pirated 
optical media items; a decline of almost 70% compared 
to 2005.  According to our police contacts, the 
reduction in seizures of pirated audio/video materials 
is due to falling demand on the local market. 
Customers who seek pirated materials consider the 
prices too high, when they can often get the same 
products over the internet for free. 
 
¶15.  In December 2006, after EOCP made some test- 
purchases, police raided shops on the site of a former 
notorious market and seized 680 CDs and DVDs containing 
pirated games, movies and music.  Police arrested the 
vendor and initiated a criminal investigation. 
 
¶16.  The police tell us that the Internet is clearly 
the most common outlet for pirated audio/video media. 
Limited resources do not allow police to wage large 
scale operations against internet piracy.  Currently, 
about ten police officers from the IT crime groups in 
Estonia are working on internet piracy under EOCP 
supervision.  Only the North Police Prefecture (Tallinn 
region) is able to carry out sustained internet 
monitoring on its own.  In 2006, their efforts resulted 
in the filing of 12 criminal cases in criminal court 
against IPR violations in the digital environment. In 
addition, the South Police Prefecture seized 1,000 
copies of pirated audio/video materials as a result of 
internet ads analysis.  However, according to our 
police contacts, the biggest obstacle in the fight 
against ever-growing IPR violations in the digital 
environment is a lack of training. 
 
¶17.  In 2006, cooperation on IPR-related cases between 
various law enforcement agencies improved. The police 
organized several successful raids together with 
 
TALLINN 00000112  004 OF 004 
 
 
Customs.  Police cooperation with IPR NGOs also 
improved.  SNB-REACT training on trademark was 
particularly useful, and resulted in effective raids in 
the Tallinn harbor area and central market. Counterfeit 
spare parts for cellular phones and cosmetics were 
seized in large quantities. (Note: SNB-REACT is a non- 
profit coalition of rights owners operating jointly 
against the trade in counterfeited goods in Europe. End 
note.) 
 
----------- 
¶H. TREATIES 
----------- 
 
¶18.  On June 14, 2006, the Parliament ratified the two 
WIPO treaties which had been pending since Estonia's 
accession to the EU: the World Phonogram Producers 
Treaty (WPPT) and the World Copyrights Treaty (WCT). 
However, according to a March 2000 EU decision, the 
WPPT and WCT ratification letters from member states 
and the European Community should be submitted 
simultaneously.  Our contacts at the Ministry of 
Culture tell us that the current holder of the EU 
Presidency, Germany, plans to submit all ratification 
letters in May 2007. 
 
 
------------------ 
¶I. POST'S ACTIVITIES 
------------------ 
 
¶19.  Promoting effective Intellectual Property Rights 
protection remains a priority for Embassy Tallinn.  The 
Embassy remains engaged with the GOE on the need to 
continue to upgrade Estonia's IPR regime.  In 2006, 
Post selected a Senior District Prosecutor for 
participation in an International Visitors Program on 
Protection of Intellectual Property Rights. 
 
¶20.  In January 2006, two lawyers from the Estonian 
Patent Office attended a course on patents at the U.S 
Patent and Trademark Office (USPTO) Global Intellectual 
Property Academy (GIPA).  In September, two Estonian 
Police Officers received training on law enforcement at 
GIPA.  Following the course, one of the police officers 
was chosen to supervise an Estonian team advising EU 
candidate countries on accession. 
 
¶21.  On April 27-28, 2006, Embassy Tallinn and the 
USPTO hosted an international workshop on 'Copyright 
Infringement in the Digital Environment'.  More than 
eighty people - police, prosecutors, government 
officials and industry representatives - from 16 
countries attended.  The conference featured 
practitioners from the USPTO, the FBI, the Department 
of Justice, and industry representatives.  Participants 
exchanged best practices on gathering evidence and 
prosecuting intellectual property crime on the internet 
and discussed the need for closer cooperation on 
internet piracy cases.  The workshop offered a forum 
for sharing best practices between the United States, 
EU Member States, and industry on this new and growing 
form of IPR violation, and also for raising public 
awareness about internet piracy. (REF B) A follow-up 
workshop was held in Tallinn on January 17-18, 2007 
(REF C). 
 
¶22.  In August 2006, under Econoff's initiative, the 
American Chamber of Commerce in Estonia established an 
IPR Sub-Committee.  The goal of this committee is to 
contribute to Estonia's IPR efforts by bringing 
together the Business Software Alliance, private 
companies, the EOCP and other interest groups on a 
regular basis.  In 2007, the AmCham IPR Committee has 
hosted two seminars to raise public awareness and 
promote IPR education, - one for teachers and another 
for small and medium businesses. 
 
GOLDSTEIN