VZCZCXRO9004
RR RUEHCN RUEHGH RUEHVC
DE RUEHGZ #0498/01 1170742
ZNR UUUUU ZZH
R 270742Z APR 07
FM AMCONSUL GUANGZHOU
TO RUEHC/SECSTATE WASHDC 6007
INFO RUEHOO/CHINA POSTS COLLECTIVE
RUCPDOC/USDOC WASHDC
RUEAIIA/CIA WASHDC
RUEKJCS/DIA WASHDC
RHHMUNA/HQ USPACOM HONOLULU HI

UNCLAS SECTION 01 OF 02 GUANGZHOU 000498 
 
SIPDIS 
 
USDOC FOR 4420/ITA/MAC/MCQUEEN, DAS LEVINE 
STATE FOR EB/TPP MASSINGA, FELSING 
STATE PASS COPYRIGHT FOR TEPP 
STATE PASS USPTO FOR DUDAS, BROWNING, ANTHONY, WONG 
STATE PASS USTR FOR MENDENHALL, MCCOY, ESPINEL, CELICO 
USDOJ FOR SUSSMAN 
DHS/CPP FOR PIZZECK 
USPACOM FOR FPA 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: KIPR ECON ETRD CH
SUBJECT: Copyright Infringement at the Canton and Jinhan Fairs 
 
REFERENCE: 06 Guangzhou 32092 
 
(U) This document is sensitive but unclassified.  Please protect 
accordingly. 
 
¶1. (SBU) SUMMARY: Representatives from U.S. and Canadian art 
publishing companies noticed a slight decline in the number of 
infringing vendors at the Canton Fair on April 25, but spotted 
numerous repeat offenders.  The overall reduction likely owes more 
to current market trends than IPR enforcement.  The IPR complaint 
centers at the Canton and Jinhan fairs were strikingly different: 
the former was well staffed by several government agencies and the 
latter was staffed by two untrained employees.  However, both fairs 
had English-language materials and the Canton Fair recently 
instituted more stringent penalties for infringers.  END SUMMARY. 
 
¶2. (SBU) Econoff accompanied representatives from three art 
publishing companies to the Canton Import and Export Fair on April 
25 to survey levels of infringement.  The companies, Art in Motion 
(based in British Colombia but representing U.S. copyright holders), 
Wild Apple (based in Vermont), and Bentley (based in California), 
are among the largest art publishers in North America and are 
members of the Art Copyright Coalition.  Separately, Econoff visited 
the IPR complaint centers of the Canton Fair and Jinhan Fair, a 
concurrent fair that also sells home decorations.  The Canton Fair 
is a government-sponsored fair while Jinhan is a private venture. 
 
 
Fewer Infringing Goods, But Less Art Overall 
-------------------------------------------- 
 
¶3. (SBU) The company representatives noticed fewer infringers at the 
Canton Fair than previous sessions (see reftel for their experiences 
at the October 2006 fair).  However, this is likely a result of 
fewer art prints on display overall.  Larry Sullivan, President of 
Art in Motion, said the current market trend is away from art prints 
and toward crafts and other types of wall hangings.  Nevertheless, 
he said the quality of infringing artwork has improved significantly 
over previous sessions - in some cases equaling that of the original 
pieces. 
 
¶4. (SBU) The Art in Motion representatives located seven of 13 
exhibitors identified as infringers at the October 2006 session. 
All seven were displaying infringing items again.  The remaining six 
were, most likely, either not displaying at this fair or had changed 
their company names.  Across the street, in a small home decoration 
fair located in a hotel, the representatives found a vendor selling 
their company catalogues.  For a fee of USD 50, a buyer could get a 
customized CD with hundreds of illegal images of U.S. copyrighted 
material. 
 
¶5. (SBU) In the past, the companies have hired lawyers to accompany 
them to the Canton Fair, but this has proven prohibitively 
expensive.  This time they came by themselves to assess the rate of 
piracy, but did not prepare any documentation (i.e., the notarized 
and legalized proofs of copyright ownership required at the IPR 
Complaint Center).  Sullivan said he was doubtful that the recently 
announced stronger penalties at the Canton Fair would significantly 
reduce piracy - largely because companies can easily change names to 
avoid detection.  He said he strongly supports the WTO complaint 
recently brought by the United States regarding China's IPR 
enforcement. 
 
Canton Fair IPR Complaint Center 
-------------------------------- 
 
¶6. (SBU) The Canton Fair's IPR Complaint Center was staffed by 
officials from the Guangdong Administration of Industry and 
Commerce, Guangdong Copyright Bureau, Guangdong Intellectual 
Property Office, and the Guangdong IPR Complaint Center (an office 
set up in 2006 to handle public IPR inquiries via telephone and 
email).  University students provided English interpretation.  The 
Center had English copies of complaint procedures and regulations, 
and for the first time had English copies of complaint submission 
forms.  When asked whether companies can use evidence collected at 
the trade fair in separate administrative or legal cases, the staff 
said they did not believe so, but seemed unsure of their answer. 
 
¶7. (SBU) Under new regulations issued prior to the current session 
 
GUANGZHOU 00000498  002 OF 002 
 
 
of the fair, exhibitors who infringe on trademarks at two sessions 
of the fair, or infringe on copyrights or patents at three sessions 
(or two consecutive sessions), will be banned from the next four 
sessions.  (Previously, exhibitors caught three times were banned 
from only one session.)  In addition, exhibitors will be banned from 
the next six sessions if they display items for which they have 
previously been penalized, administratively or judicially.  This 
penalty was imposed in one reported case during the current session 
of the Canton Fair.  The fair's IPR complaint center received 203 
complaints during the first half of the fair (April 15-20), down 15 
percent from the October fair. 
 
Jinhan Fair IPR Complaint Center 
-------------------------------- 
 
¶8. (SBU) The Jinhan Fair, which is adjacent to the Canton Fair, 
includes a home decoration session that lasts for six days.  The 
fair is run by a private enterprise and the fair's IPR Complaint 
Center is staffed by two young employees of the company.  The 
employees, who have little to no IPR training, said they contact 
staff at the Canton Fair's IPR Complaint Center if they need 
assistance (for example, verifying documents).  They said they 
received no IPR-related complaints at the October 2006 session of 
the fair, apart from those lodged by Art Copyright Coalition 
members, and had received "very few" complaints halfway through the 
current session. 
 
¶9. (SBU) The fair's IPR complaint center had English copies of 
complaint submission forms, letters of commitments issued to 
infringing exhibitors, and general complaint procedures.  Included 
in the contract that exhibitors sign is a clause stating they will 
not display infringing goods.  When asked about penalties for 
infringers, the staff said exhibitors are banned from one session of 
the fair if they are caught displaying counterfeit goods at 
"several" sessions.  When asked to clarify "several", they said 
between three-and-five. 
 
GOLDBERG