VZCZCXRO5195
OO RUEHHM
DE RUEHHI #0425/01 0641026
ZNR UUUUU ZZH
O 051026Z MAR 07 ZDK
FM AMEMBASSY HANOI
TO RUEHC/SECSTATE WASHDC IMMEDIATE 4821
INFO RUEHHM/AMCONSUL HO CHI MINH 2698
RUEHBK/AMEMBASSY BANGKOK 5502
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEHRC/DEPT OF AGRICULTURE USD FAS WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC

UNCLAS SECTION 01 OF 02 HANOI 000425 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR EAP/MLS AND EB/TPP/IPE JBOGER 
STATE ALSO PASS USTR JCHOE-GROVES AND DBISBEE 
AMEMBASSY BANGKOK FOR USPTO JNESS 
USDOC FOR ITA/MAC/OIPR CPETERS AND 4430/MAC/AP/OPB/VLC/HPPHO 
 
E.O. 12958: N/A 
TAGS: ETRD KIPR ECON WTRO VM
SUBJECT: PM DZUNG INSTRUCTS GVN AGENCIES TO PURCHASE COPYRIGHTED 
SOFTWARE 
 
REF: (A) HANOI 308 (B) HANOI 309 (C) Hanoi 310 
 
HANOI 00000425  001.2 OF 002 
 
 
¶1. (SBU) Summary:  On February 22, Prime Minister Nguyen Tan Dzung 
issued Instruction No. 04/2007/CT-TTg calling on government agencies 
to strengthen software copyright protection in compliance with 
Vietnam's international copyright protection commitments.  This new 
policy delegates specific responsibilities for software copyright 
protection among no fewer than nine Government of Vietnam (GVN) 
ministries.  Perhaps most important, the Instruction compels all 
government ministries and provincial administrations to purchase 
copyrighted software for use by their employees.  Many questions 
about how this policy will be implemented, however, remain.  Without 
adequate budget resources, political will and the designation of a 
properly-empowered oversight authority, Instruction 04/2007 risks 
falling short of its intended goals.  End Summary. 
 
Positive Steps on Copyright Protection in Vietnam 
--------------------------------------------- ---- 
 
¶2. (U) On February 22, Prime Minister Nguyen Tan Dzung issued 
Instruction No. 04/2007/CT-TTg calling for government agencies to 
strengthen software copyright protection.  This announcement comes 
closely on the heels of Vietnam's accession to the World Trade 
Organization (WTO) and calls for government ministries and agencies 
as well as provincial and city People's Committees to implement 
Vietnam's domestic and international commitments on software 
copyright protection.  Instruction 04/2007 tasks the heads of each 
agency (i.e. Ministers and People's Committee Chairmen) with direct 
responsibility for rooting out the rampant use of pirated software 
in their respective organizations.  Software piracy among Government 
of Vietnam (GVN) agencies has been a contentious issue for foreign 
software industries and an area of focus for this Mission (reftel 
A). 
 
¶3. (U) Instruction 04/2007 also includes a detailed outline of 
broader responsibilities for ensuring software copyright protection 
in Vietnam among no fewer than nine ministries.  Notably, the 
Instruction calls for increased enforcement efforts and an expanded 
public outreach and education strategy.  The Deputy Director for 
International Cooperation in the National Office of Intellectual 
Property (NOIP), Mr. Mai Van Son, noted that Vietnam's recent steps 
to strengthen the IP legal regime (reftels A and B) should help to 
increase the effectiveness of this new policy. 
 
Where's the Money? 
------------------ 
 
¶4. (SBU) Significantly, Instruction 04/2007, which was drafted by 
the Ministry of Culture and Information's Copyright Office of 
Vietnam (COV), calls on the Ministry of Finance (MOF) and Ministry 
of Planning and Investment (MPI) to provide state budget resources 
and guidance to facilitate government agencies' efforts to purchase 
legitimate copies of business software.  (Note: In 2006, the MOF was 
the first major government agency to move towards the legal use of 
software when it purchased 15,000 Microsoft Office copyrights.  We 
understand that the Ministry of Posts and Telematics also intends to 
sign an agreement with Microsoft pledging to use only licensed 
software.  End note.)  With software piracy rates estimated to range 
between 85 and 92 percent, some projections show that the total cost 
for purchasing software copyrights for the two million government 
employees will be approximately USD 1 billion.  The cost for all 
Vietnamese computer users, including private firms and households, 
to legitimize their software products ranges closer to USD 5-6 
billion. 
 
¶5. (SBU) In a March 1 meeting, Mr. To Van Long, Director of COV's 
Copyright Management Division, said that the GVN has no formal 
estimates for the cost of this effort.  According to Mr. Long, each 
ministry and provincial People's Committee is responsible for 
submitting a budget proposal to MPI and MOF to implement this new 
directive.  No deadline has been set for this process, and it is 
uncertain which agency or agencies will be tasked with ensuring that 
all GVN bodies submit budget requests in a timely manner. 
Recognizing the costs involved with this effort, Long hopes that 
foreign software providers will "work with Vietnam to reach an 
affordable price and package" to enable it to address the software 
copyright problem. 
 
Hurdles to Practical Implementation 
----------------------------------- 
 
HANOI 00000425  002.2 OF 002 
 
 
 
¶6. (SBU) The ability to implement this new directive in the near 
future may be hampered by the recently-promulgated government IT 
procurement policy, outlined in the 2006 Decisions 169 and 223 
(reftel C), which creates preferences for domestic IT producers.  In 
order for GVN agencies and ministries to purchase foreign IT 
products, including software, they must submit detailed dossiers 
explaining why a foreign provider was selected over a local 
provider.  This lengthy administrative process may prolong GVN 
agency efforts to purchase legitimate software and could prohibit 
serious efforts to conclude legal licensing agreements with foreign 
software producers.  Econoff noted that the COV could be an 
important voice in pushing for revisions to this government 
procurement policy to ensure that it does not unnecessarily hinder 
implementation of this new Instruction. 
 
¶7. (SBU) It is also unclear how the GVN will monitor compliance with 
Instruction 04/2007, or if the COV or another enforcement agency 
will be empowered to inspect or audit implementation among other GVN 
agencies.  COV's Long said that the Ministry of Culture and 
Information's (MOCI) Inspectorate has the expertise and authority, 
and is therefore best positioned to conduct such inspections.  When 
pressed on the feasibility of the MOCI Inspectorate sanctioning 
other, perhaps more influential, government ministries, Long 
implored the USG to understand that this would be a "step-by-step" 
process. 
 
Comment 
------- 
 
¶8. (SBU) Instruction 04/2007 is a welcome development that 
demonstrates Vietnam's commitment to uphold its obligations under 
the WTO TRIPS agreement.  Given some of the potential obstacles 
outlined above, however, it will take some time to assess the real 
impact of this policy.  Without adequate budget resources, political 
will and the designation of a properly-empowered oversight 
authority, Instruction 04 risks falling short of its intended goals. 
 It will be important for the GVN to take the lead in following 
through, as private firms and households will be unlikely to act 
until the government first takes action. 
 
MARINE