VZCZCXRO6848
PP RUEHRG
DE RUEHBR #0944/01 1451256
ZNR UUUUU ZZH
P 251256Z MAY 07
FM AMEMBASSY BRASILIA
TO RUEHC/SECSTATE WASHDC PRIORITY 9027
INFO RUEHSO/AMCONSUL SAO PAULO 9942
RUEHRI/AMCONSUL RIO DE JANEIRO 4445
RUEHRG/AMCONSUL RECIFE 6695
RUCPDOC/USDOC WASHDC
RUEHAC/AMEMBASSY ASUNCION 6093
RUEHBU/AMEMBASSY BUENOS AIRES 4785

UNCLAS SECTION 01 OF 02 BRASILIA 000944 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR EB/TPP/IPE JENNIFER BOGER 
DEPT PASS USTR FOR VICTORIA ESPINEL, CHRIS WILSON, SUE CRONIN AND 
JENNIFER CHOE GROVES 
USDOC FOR ITA/MAC/OIPR CASSIE PETERS 
USDOC FOR ITA/MAC/WH/OLAC/MCAMPOS 
 
E.O. 12958: N/A 
TAGS: KIPR ETRD ECON BR
SUBJECT:  BRAZIL: Corruption, Public Apathy, Lack of Resources 
Hampers Anti-Piracy Efforts in Pernambuco 
 
REF:  A) Recife 37 
 
¶1. (SBU) Summary: On May 10, Federal Police stationed in the 
north-eastern state of Pernambuco told EmbOff that public apathy, 
corruption among state officials, and limited resources have 
undercut their efforts to stem the flow of pirated goods in the 
region.  Despite a directive from the state's new governor, state 
officials are viewed by federal authorities as unreliable allies due 
mainly to widespread corruption.  Public acceptance of piracy as a 
legitimate activity has led to continued growth in contraband sales 
in the state and investigations of other crimes have siphoned off 
limited resources from anti-piracy actions.  The officials felt the 
state has increasingly become an alternate conduit to the Paraguayan 
border for the import of pirated goods from China.  Federal Police 
requested the USG place an emphasis on conducting IPR training 
programs in the state.  End Summary. 
-------------------------- 
State Corruption a Concern 
-------------------------- 
 
¶2. (SBU) Federal police in Recife told EmbOff on May 10 that they 
were reluctant to share information on anti-piracy operations with 
Pernambuco state police due to concerns about widespread corruption, 
despite a recent directive from the new governor, Eduardo Campos 
(who took office January 1), instructing state authorities to 
cooperate fully with federal anti-piracy efforts.  While they 
believe the governor is sincere, they said state police do not share 
his commitment. 
 
--------------------------- 
Public Acceptance of Piracy 
--------------------------- 
 
¶3.  (SBU) Federal police officials in this north-eastern city of 2 
million are frustrated by public acceptance of IPR piracy as the 
natural consequence of a burdensome tax regime that drives up the 
price of legitimate goods.  The general public view is that sellers 
of contraband items are offering popular goods at affordable prices 
and not regarded as criminals.  One police official said street 
vendors often openly modify legitimate video game machines to accept 
pirated products - an unauthorized version of a popular video game 
can be purchased for as little as USD 5 versus USD 100 for a 
licensed copy. 
 
----------------- 
Limited Resources 
----------------- 
 
¶4.  (SBU) Federal Police pointed out that higher-profile crimes such 
as murder and money laundering vie with IPR violations for limited 
resources.  They rely mainly on private groups to monitor piracy 
activities and alert police when they discover them.  They noted 
that their operations are also constrained by a lack of storage 
space for confiscated items.  As an example, one police official 
described a recent raid which netted 250 thousand illegal DVDs and 
CDS.  He said the items seized during that raid alone would not fit 
in a space the size of the police headquarters conference room and 
explained that the disposition of "tons of plastic" from the seized 
items poses significant environmental concerns. 
 
------------------------------------------ 
A Smugglers' Alternative to Foz De Iguacu? 
------------------------------------------ 
 
¶5.  (SBU) Police officials said they have seen a rise in IPR piracy 
in the state over the last seven years, an observation that may 
support a recent assertion by the head of a large anti-piracy group 
that smugglers are increasing their use of the ports in the 
northeast then shipping goods inland to circumvent increased GOB 
scrutiny at the Foz De Iguacu frontier with Paraguay.  One police 
officer said that although most CDs and DVDs found in the local 
market were manufactured in small factories in Brazil, police have 
found a number of counterfeit imported toys, electronics, CDs, DVDs 
and tennis shoes - mainly from China. 
 
¶6.  (SBU) Comment:  The refusal of Pernambuco state police to meet 
with EmbOff underscored the Federal officials' point about a 
disconnect with state officials on IPR issues.  Police officials 
agreed that the USG could help by conducting more IPR training 
 
BRASILIA 00000944  002 OF 002 
 
 
programs in the north-east.  End Comment. 
 
Chicola