VZCZCXYZ0003
PP RUEHWEB

DE RUEHDR #1068/01 2130322
ZNR UUUUU ZZH
P 010322Z AUG 07
FM AMEMBASSY DAR ES SALAAM
TO RUEHC/SECSTATE WASHDC PRIORITY 6539
INFO RUEHJB/AMEMBASSY BUJUMBURA PRIORITY 2568
RUEHKM/AMEMBASSY KAMPALA PRIORITY 3050
RUEHLGB/AMEMBASSY KIGALI PRIORITY 0996
RUEHNR/AMEMBASSY NAIROBI PRIORITY 0728
RHEHAAA/THE WHITE HOUSE WASHDC PRIORITY

UNCLAS DAR ES SALAAM 001068 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT AF/E FOR BYODER; AF/EPS FOR MNORMAN; EEB/IPE; PLEASE 
PASS TO USTR FOR WJACKSON 
 
E.O. 12958: N/A 
TAGS: KIPR ETRD ECON TZ
SUBJECT: BATTLE AGAINST COUNTERFEIT GOODS UNDERWAY, 
REINFORCEMENTS EXPECTED 
 
REF: NAIROBI 02393 
 
¶1. (SBU)  SUMMARY:  The Government of Tanzania (GOT) is 
establishing a comprehensive system for addressing the 
problem of counterfeit goods by improving existing 
legislation, preparing implementing regulations and seeking 
autonomy from the judiciary.  In the meantime, the GOT's Fair 
Competition Commission (FCC) is using existing law and 
customs regulations to expose and destroy counterfeit goods. 
END SUMMARY. 
 
¶2.  (SBU)  The FCC has located, seized, and destroyed caches 
of counterfeit goods in recent months, primarily upon their 
entry at the port of Dar es Salaam, Godfrey Mkocha, Director 
General of the Fair Competition Commission (FCC), and John 
Mponela, Head of the FCC's Anti-Counterfeit Department, told 
Emboff July 10.  In May 2007, the FCC received a tip that 
counterfeit light bulbs, imported from China by a Chinese 
company operating in Dar es Salaam since 1998, were at the 
port.  The FCC used customs regulations to open the container 
in question, confirmed the goods were counterfeits of the 
Dutch brand Phillips, and destroyed them in the presence of 
the media and at the cost of the importing company, 
increasing awareness and serving as a deterrent. 
 
¶3.  (SBU)  Mkocha believes there are a relatively small 
number (no more than twenty) of counterfeit import operations 
in Tanzania, but that they are well-organized and 
well-connected.  Counterfeit importers identify a fast-moving 
branded item, send a sample to a firm in Hong Kong or South 
East China and ask the firm to manufacture a container's 
worth of the item which the importer then sells at a price 
lower than that of the branded item.  Mkocha noted this 
system of counterfeiting is popular with fast-moving branded 
clothing and is used by small businesses as well as larger 
operations. 
 
¶4.  (SBU)  The "scourge" of counterfeit goods is affecting 
many unsuspecting and uneducated consumers in rural and urban 
areas, especially counterfeit medicine, food and electrical 
goods which often cause fires, Mkocha told Econoff July 12. 
Due to the dangers of sub-standard goods, Mkocha aims to 
"protect the people first, then the general merchandise." 
Mkocha and Mponela said they want to work closely with 
foreign businesses affected by the trade in counterfeit 
goods. 
 
¶5. (SBU)  John Mhina, Director of International Trade in the 
Ministry of Industry, Trade, and Marketing, told Emboff the 
FCC "has the teeth to bite," expressing both his belief that 
the FCC is empowered to take action against the trade in 
counterfeit goods, and his positive view of the FCC's recent 
efforts. 
 
¶6. (SBU)  The FCC is enhancing the GOT's efforts to combat 
counterfeit goods by proposing amendments to the Merchandise 
Marks Act, Mkocha told Econoff.  The Merchandise Marks Act 
outlaws the manufacture or importation of goods with forged 
or deceptive trademarks, false trade description, or false 
name or initials.  The proposed amendments, which Mkocha 
expects Parliament to pass as part of an omnibus 
miscellaneous bill at the end of the current session, creates 
the position of Chief Inspector at the FCC and empowers the 
Minister of Industry, Trade and Marketing to appoint the 
Chief Inspector and other inspectors and to issue 
implementing regulations.  Mkocha expects the amendments to 
grant the FCC greater autonomy, particularly from the 
judiciary, by granting investigatory and prosecutorial 
authority to the Chief Inspector.  Current law requires the 
FCC to obtain a judicial order to perform a search and 
seizure. 
 
¶7.  (SBU)  The FCC wants regulations which formalize the 
powers of a Task Force regarding intellectual property rights 
(IPR) and counterfeit issues, and address certain gaps in the 
Merchandise Marks Act.  These gaps include the process for 
storing and destroying counterfeit goods, how to discourage 
frivolous allegations that goods are counterfeit, 
establishing an internal appeal mechanism and establishing 
modalities for paying fines.  At the FCC's request, the 
Tanganyika Law Society drafted regulations which have been 
reviewed by stakeholders and the Attorney General so when 
Parliament passes the amendments, the Minister may sign and 
publish the regulations for immediate use.  "With 
 
regulations, three-quarters of the problems would be solved," 
Mkocha said. 
¶8.  (SBU)  To further the fight against counterfeit goods, 
Mkocha suggested Dar es Salaam undergo a port audit similar 
to one conducted in Mombasa, Kenya in 2006, noting the 
potential for counterfeit goods to proliferate in Tanzania if 
authorities can't account for goods entering the country via 
the port.  Mkocha added "counterfeits generate big money, so 
it's not difficult to buy influence at the port." 
 
¶9.  (SBU)  COMMENT:  Given the widespread believe that 
Tanzania's judiciary is susceptible to corruption and 
Mkocha's characterization of counterfeit traders as 
well-connected, his desire to obtain greater autonomy from 
the judiciary is highly practical.  The FCC's swift action to 
amend the Merchandise Marks Act and put regulations in place 
before the October 2007 regional IPR conference in Dar es 
Salaam (reftel) is commendable and, if successful, indicates 
high-level support within the GOT to protect intellectual 
property.  END COMMENT. 
RETZER