VZCZCXRO3851
OO RUEHAG RUEHAST RUEHDA RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA RUEHLN
RUEHLZ RUEHPOD RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHPG #0117 0521542
ZNR UUUUU ZZH
O 211542Z FEB 08
FM AMEMBASSY PRAGUE
TO RUEHC/SECSTATE WASHDC IMMEDIATE 0087
INFO RUCPDOC/DEPT OF COMMERCE WASHDC IMMEDIATE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE

UNCLAS PRAGUE 000117 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR EUR/NCE AND EB/IPE JBOGER 
STATE PASS USTR FOR JCHOE-GROVES AND WMOORE 
COMMERCE FOR 4232/ITA/MAC/MROGERS 
COMMERCE PASS USPTO 
 
E.O. 12958: N/A 
TAGS: KIPR ETRD ECON PGOV EZ
SUBJECT: CZECH REPUBLIC: KEEP THEM ON THE IPR WATCH LIST 
 
REF: A. PRAGUE 33 
 
     ¶B. 07 PRAGUE 1228 
 
¶1. (SBU) SUMMARY AND RECOMMENDATION: Post recommends the 
Czech Republic remain on the Watch List for the 2008 Special 
301 review for reasons stated in ref A.  Since being placed 
on the Watch List during the January 22 Out-of-Cycle Review, 
the Czechs have made little progress in implementing their 
IPR Action Plan and reducing IPR violations at the border 
markets.  Czechs continue to stress the amount of effort they 
have put into the development of their action plan but 
understand that the USG and industry are looking for results, 
not just intent.  However, given sustained Czech efforts, 
elevated political will, and their desire to get off the 
Watch List before taking over the EU Presidency in January 
2009, Post suggests the USG offer another OCR in fall 2008 as 
a carrot for the Czechs to implement their Action Plan and 
show real results.  The Czechs plan to submit a Special 301 
response to USTR by the February 29 deadline.  END SUMMARY 
AND RECOMMENDATION. 
 
POLITICAL PRESSURE RISES 
------------------------ 
¶2. (SBU) Newly-appointed Ministry of Industry and Trade (MIT) 
EU Department Director Lucie Sestakova told Econoffs that 
Deputy Minister Martin Tlapa was "disappointed" by the Czech 
Republic's placement on the Watch List and believed it was 
"unfair" given all the effort the GOCR has put in to its IPR 
Action Plan.  Sestakova, lamenting that there has not been 
sufficient time to implement the Czech IPR Action Plan, asked 
whether the possibility to get off the IPR Watch List during 
the April 2008 Special 301 review was "real."  Econoffs 
replied that the opportunity is real but only real results 
would lead to removal from the Watch List.  Econoffs also 
reminded that the USG began engaging the Czechs about IPR 
violations at the border markets in early 2007 but that an 
Action Plan did not materialize until October.  Sestakova 
acknowledged the timeline and assured that the Czech Republic 
would submit a response to USTR by the February 29 deadline 
that includes data showing real improvements in the IPR 
situation. 
 
¶3. (SBU) Recently-appointed Vice Minister of Industry and 
Trade for Trade and Bilateral issues Milan Hovorka told 
econoffs February 4 that IPR violations at the border markets 
are being discussed at the Ministerial level and expressed 
his desire to cooperate with the USG to resolve the issue. 
Hovorka, a sharp and reliable interlocutor, expressed his 
desire to set up regular monthly meetings with the Embassy to 
discuss bilateral issues, and said that the border market 
violations will be one of his focus areas in these 
discussions. 
 
DEVELOPMENTS SINCE OCR REVIEW 
---------- --- -------- ---- 
¶4. (SBU) Czech press reported that on February 5,  a customs 
officer inspecting the Vojtanov border 
market (125 miles west of Prague) was stabbed during a 
confrontation with a group of approximately thirty stall 
owners.  The police and customs agents responded with a 
massive and sustained presence at the markets in the region 
of Vojtanov/Cheb.  Subsequent press reports indicate that the 
sustained law enforcement presence has nearly eliminated the 
sale of pirated goods at the markets in the immediate 
vicinity, and actually caused vendors to start selling 
legitimate goods.  Local recording industry (IFPI) 
representative Petra Zikovska commented to emboff that the 
unfortunately incident may be just the kind of impetus Czech 
local authorities need to enforce the rule of law at the 
border markets. 
 
¶5. (SBU) COMMENT: Keeping the Czechs on the Special 301 Watch 
List will provide the necessary pressure the Czech government 
needs to implement its IPR Action Plan and achieve timely 
results at the border markets.  Czech Prime Minister Mirek 
Topolanek's February visit to the United States is providing 
the necessary political pressure for the Ministry of Industry 
and Trade to take appropriate action to get off of the 
Special 301 Watch List.  The real test will be to see if this 
unprecedented political will lasts after the PM's trip is 
over.  In the meantime, Post suggests the USG offer another 
OCR in fall 2009 to give the Czech Republic an additional 
carrot to redouble their efforts and achieve results to get 
off of the IPR Watch List before taking over the EU 
Presidency on January 1, 2009. 
Graber