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P 300950Z MAY 08
FM AIT TAIPEI
TO RUEHC/SECSTATE WASHDC PRIORITY 9043
INFO RUEHOO/CHINA POSTS COLLECTIVE
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RHMFIUU/DEPT OF JUSTICE WASHINGTON DC

UNCLAS SECTION 01 OF 03 TAIPEI 000745 
 
SENSITIVE 
SIPDIS 
 
STATE PLEASE PASS TO AIT/W AND EAP/RSP/TC 
STATE PASS USTR/DAVID KATZ AND JARED RAGLAND 
USDOC FOR 4431/ITA/MAC/AP/OPB/TAIWAN 
USDOC ALSO FOR ITA/MAC/OIPR 
USDOC PASS TO USPTO GIN, BROWNING, AND LOC STEPP 
USDOJ FOR JOHN ZACHARIA 
 
E.O. 12958: N/A 
TAGS: ECON ETRD KIPR TW
SUBJECT:  Taiwan IPR: 301 Watch List OCR Process Update 
 
Ref: A) State 43143; B) Taipei 734 
 
¶1. (SBU) Summary: Taiwan is making progress in two of the three 
areas outlined in last month's 301 Watch List submission for Taiwan 
(ref A). The process of finalizing language for the internet service 
provider (ISP) amendments to Taiwan's Copyright Act has stalled due 
to ISP-industry objections over language that rights-holders believe 
is important to giving the legislation teeth. The Taiwan 
Intellectual Property Office (TIPO) now predicts that it will not be 
able to pass the final draft to the Executive Yuan (EY) until August 
at the earliest. In better news, the Intellectual Property (IP) 
Court is set to open on July 1, and will begin accepting new cases, 
including appeals, on that date, and the Ministry of Education (MOE) 
invited rights-holder and university representatives to another 
meeting of its IP task force to review progress under the ongoing 
Campus IP Action Plan. End summary. 
 
TIPO Still Working on ISP Language 
----------------------------------- 
 
¶2. (U) On May 22, econoff met with Margaret Chen, Deputy Director 
General of TIPO, and Chang Yu-ying, Director of the TIPO Copyright 
Office, to discuss the current state of draft amendments to the 
Copyright Law that would limit an Internet service provider's (ISP) 
liability if the ISP quickly removed IPR-infringing material. This 
is the latest version of the amendments that TIPO first drafted in 
March 2007. 
 
¶3. (SBU) Chang told us that after contentious public hearings on 
February 14 and May 7, the ISP industry and rights-holder groups 
still hold differing opinions on the draft amendments, with 
rights-holders pushing for inclusion of clear language outlining 
contributory or secondary liability for ISPs that negligently allow 
copyright-infringing materials to be hosted by their service 
(article 88 in the previous draft version), and ISPs strongly 
opposed to including such references.  ISPs also worry that the 
draft language neither adequately protects ISPs from civil suits 
with a clear "safe-harbor" provision, nor protect ISPs from possible 
criminal suits, since copyright infringement in Taiwan can be 
subject to criminal prosecution. Other differences include each 
side's opinion on the definition of what an ISP is, and meanings for 
several other technical terms, but both sides agree that the key 
issue is secondary liability. 
 
¶4. (SBU) Chang told econoff that the MOJ has verbally affirmed to 
TIPO the MOJ view that current ROC law (article 128 of the Civil 
Code) already contains the concept of secondary liability, that this 
would be applicable to ISPs, and that it would therefore be 
unnecessary and improper to re-state such liability in the ISP law 
draft.  She said that MOEA has formally requested that the MOJ 
provide a clear written explanation on this question in order to 
allay the concerns of rights-holders.  She expects a reply from the 
MOJ in June, after which TIPO--assuming that rights-holders are on 
board--can complete the ISP law draft with the MOJ notes as 
reference materials by late June or early July, and then submit its 
final draft to the Executive Yuan in August. 
 
¶5. (SBU) Local rights-holder groups IFPI Taiwan and Taiwan 
Foundation Against Copyright Theft (TFACT), however, strongly prefer 
including the current language in article 88 with clear statement of 
secondary liability for ISP operators.  According to the two groups, 
although the Taiwan Civil Code contains the concept of liability for 
contributory or vicarious infringement, rights-holders fear that the 
Code is not clear enough about whether this liability would apply to 
ISPs.  Rights-holders are somewhat flexible on this, however, and 
have told us that they could accept TIPO dropping "article 88" 
language as long as the MOJ written explanation is satisfactory and 
the final amendments retain article 90 quinquies, which states that 
ISPs can be free from liability if they have taken swift action on a 
take-down notice. 
 
¶6. (SBU) Econoff passed on USTR's request that TIPO accept another 
round of feedback from USTR on the current version of the 
amendments. Chen said TIPO will, of course, offer an English version 
of the ISP draft to the U.S. side for comments as soon as TIPO 
completes the ISP draft, and will welcome U.S. reactions and 
suggestions.  She said the MOJ's clarification about secondary 
liability and U.S. comments will be key factors in determining the 
progress of Taiwan's ISP law legislation. Chen said that TIPO knows 
that the ISP law is a key factor in USTR's OCR, and that TIPO will 
continue to do its best to push a good ISP law to the LY as fast as 
possible. 
 
 
TAIPEI 00000745  002 OF 003 
 
 
IP Court on Track for July Opening 
---------------------------------- 
 
¶7. (SBU) On May 23, econoff met with Kao Shiou-jen, Director of the 
Judicial Yuan (JY) Preparatory Office for the Intellectual Property 
Court and, after July 1, the President of the IP Court.  Ms. Kao 
confirmed that the IP Court will begin operating on July 1 by 
accepting both new cases and appeals from cases that finished on or 
before June 30.  She said that while the court will start with only 
eight judges, the JY plans to review this number after a suitable 
period has passed. At the initial stage, the IP court will also have 
nine technical experts who will serve as advisors and case review 
officers, and will also be available to support judges in 
district-level courts if needed.  To support the IP Court, the 
Ministry of Justice will set up an office with three specialized IP 
prosecutors. 
 
¶8. (SBU) Although JY regulations call for judges to complete 
first-instance cases within 16 months, Kao said that the IP Court 
will expect its judges to finish cases within 12 months.  Also, the 
Court will ask its judges to complete criminal cases that have been 
appealed from local courts--a process that typically takes 24 
months--"as quickly as possible." 
 
MOE Gets Together with Industry and School Reps 
--------------------------------------------- -- 
 
¶9. (U) On May 12, the Ministry of Education (MOE) convened the third 
meeting of its IP Task Force to review university progress under the 
ongoing Campus IP Action Plan, which went into effect in October 
¶2007. 
 
¶10. (U) At the May 12 meeting, the MOE presented an interim report 
on progress thus far under the Action Plan. According to the report, 
127 of Taiwan's 165 universities have set up IP protection teams on 
campus, most chaired either by the school's President or Vice 
President. 146 universities have held seminars, training programs, 
or short courses to promote the concept of IP protection on campus. 
Almost every university has distributed information on fair use of 
copyrighted materials and other IP information to both teachers and 
students, and 117 have set up IP consulting mechanisms for faculty 
and students to clarify fair-use and other IP-related questions with 
scholars and legal experts. 78 universities invited TIPO's IP 
service team to conduct IP promotion activities on campus, and 73 
sent teachers to take IP training from TIPO's IP Institute. 
 
¶11. (U) 132 of 165 schools now include language in contracts with 
on-campus copy shops that allow the universities to terminate shops' 
contracts if the shops are found to have violated Taiwan's copyright 
laws, and an MOE staff member told us that the remaining 33 
universities will insert similar language into such contracts at the 
time of the next renewal.  According to the MOE report, almost all 
universities now affix warnings against illegal copying onto or near 
all campus photocopying machines. The majority have also established 
physical or virtual platforms for used-book exchange. 
 
¶12. (SBU) To fight internet IPR violations, 159 universities have 
incorporated MOE guidelines into rules governing on-campus use of 
the island-wide academic network TANet, and almost all of these 
schools have established procedures to impose punishments on 
students who repeatedly and seriously infringe on intellectual 
property rights, and about 150 have set ceilings on data 
transmission and installed various measures to prevent infringement 
from P2P software.  Local rights-holder groups--while still 
concerned about copyright infringements on TANet--tell us that they 
are pleased with the recent MOE pledge to respond to rights-holder 
TANet complaints within 60 days, and to periodically post on the MOE 
homepage statistics about TANet violations. 
 
Comment 
------- 
 
¶13. (SBU) We are confident that the IP Court will open as scheduled 
on July 1, and we assess that MOE-led campus IP enforcement efforts 
are moving forward, although the pace could be faster.  The lack of 
progress toward satisfactory ISP-amendment language is 
disappointing, however, as the local ISP industry has continued to 
raise objections that need to be reviewed and addressed.  Much will 
depend on the MOJ evaluation of how adequate secondary-liability 
concepts are in the current Civil Code.  Although rights-holders are 
willing--under certain conditions--to accept a final version that 
lacks current "article 88" language, we will continue to use every 
occasion to push TIPO both to finalize amendments clearly 
 
TAIPEI 00000745  003 OF 003 
 
 
incorporating the concept of secondary liability, and to move such a 
bill to the EY after additional industry and U.S. feedback. End 
comment.