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RHMFIUU/DEPT OF JUSTICE WASHINGTON DC

UNCLAS SECTION 01 OF 02 TAIPEI 001318 
 
SIPDIS 
 
STATE FOR EAP/TC 
STATE PASS USTR FOR KATZ AND RAGLAND 
COMMERCE FOR 4431/ITA/MAC/AP/OPB/TAIWAN 
COMMERCE ALSO FOR ITA/MAC/OIPR, 
COMMERCE PASS TO USPTO GIN, BROWNING, AND LOC STEPP 
USDOJ FOR JOHN ZACHARIA 
 
E.O. 12958: N/A 
TAGS: ECON ETRD KIPR PREL PGOV TW
SUBJECT: Taiwan IPR: 301 Watch List OCR Update Three 
 
Reftels:  A) Secstate 43143, B) Taipei 950, C) Taipei 1039, D) 
Taipei 0008, E) Taipei 1258 
 
¶1. (SBU) Summary: Taiwan has now made measurable progress on all 
three areas outlined in May's Special 301 Watch List submission for 
Taiwan (ref A).  Following the July opening of the Intellectual 
Property (IP) Court (ref B) and ongoing actions under the Campus IP 
Action Plan, the Taiwan Intellectual Property Office (TIPO) 
forwarded to the Executive Yuan (EY) on August 27 a draft version of 
internet service provider (ISP) amendments to Taiwan's Copyright 
Act.   TIPO predicts that the EY will approve this version of the 
bill and send it to the Legislative Yuan for consideration by the 
end of September. The Ministry of Education continues to engage with 
rights-holder groups, and has affirmed that the Ministry's 
island-wide academic network TANet would be treated as an ISP under 
the current draft version of the ISP bill.  We have asked Taiwan 
officials to provide assurances of support for passage of the bill 
in its current form.  We will also continue to monitor and encourage 
support for the bill until its passage.  Given progress to date and 
prospects for passage of acceptable, if not ideal, ISP legislation, 
we recommend that Taiwan be removed from the 301 Watch List.  End 
summary. 
 
--------------------------------------------- 
ISP Bill Moving Closer to Goal Line 
--------------------------------------------- 
 
¶2. (SBU) On August 27, TIPO sent to the EY its final draft version 
of ISP-related amendments to the Copyright Act.  According to TIPO 
Deputy Director General Margaret Chen, TIPO expects the EY to 
approve the draft amendments in September, and forward the draft on 
to the Legislative Yuan (LY) for approval soon afterwards.  Chen 
does not know when the LY will take a vote on the amendments, 
however, nor could she forecast whether the LY would pass the 
amendments.  [Note: The LY's fall session started on September 1 and 
wraps up end-December. End note.] 
 
¶3. (SBU) The latest version of the ISP-related amendments does not 
include U.S.-suggested language included in Article 88 of previous 
versions that specifically referred to secondary (or contributory) 
liability for ISPs that knowingly host copyright-infringing 
material. Instead, the bill includes a written opinion from the 
Ministry of Justice stating ISP operators are subject to secondary 
liability under Article 185 of the Civil Code.  On September 2, 
local rights-holder groups reaffirmed to econoff that they would 
prefer to have the concept of secondary liability clearly laid out 
in the bill, but can accept the amendment's current wording.  Some 
rights-holder groups have also told AIT that after TIPO submits the 
bill to the LY, a KMT Legislator will add language related to 
secondary liability back into the amendment (ref C).  The bill also 
does not reflect U.S. recommendations that ISPs should be liable for 
infringing material that they "should have knowledge" of, not just 
for infringing material that they "have knowledge" of, though local 
rights-holder groups have not pushed AIT to address this issue. 
 
------------------------- ------------------------------ 
MOE Action Plan Improves, Rights-holders Still Concerned 
------------------------- ------------------------------ 
 
¶4. (SBU) During an August 19 meeting with Ministry of Education 
(MOE) Computer Center Deputy Director Han Shan-min, Ms. Han updated 
econoff on the continuing work of the MOE under its Campus IP Action 
Plan.  Following a baseline survey made in June 2007 on network 
management practices at 16 universities, the Computer Center is 
undertaking another survey of 10 schools to evaluate their 
enforcement efforts after the Action Plan's first year.  The MOE 
will compile the results of this survey by the end of September, and 
use these results as the basis of a new enforcement report with more 
detailed indicators in October or November. 
 
¶5. (SBU) The MOE has also increased feedback to rights-holders under 
the Action Plan.  In response to rights-holder requests--and AIT 
encouragement--the Computer Center instituted a new SOP for 
rights-holder complaints, designating a staff member as the 
complaints point-of-contact (POC) and producing more detailed, 
bi-monthly reports on reported infringements.  The last such report 
came out on August 21.  Han also informed econoff that on May 8, the 
MOE ordered all universities to block installation of peer-to-peer 
(P2P) software on all publicly-available terminals, as well as make 
periodic checks for such software.  This move is a tightening of 
restrictions implemented by the MOE in fall 2007 that curbed student 
access to P2P websites and software (ref D). 
 
¶6. (SBU) In addition, although the MOE had been wary of classifying 
 
TAIPEI 00001318  002 OF 002 
 
 
TANet as a normal ISP, Han said that the MOE now agrees that TANet 
meets the ISP definition included in the draft Copyright Law 
amendments that TIPO passed to the EY last week.  TANet 
administrators at Taiwan's schools would therefore be subject to the 
revised law's notice and takedown requirements.  Han said if the EY 
passes the current version of the amendments, the MOE would work out 
enforcement rules for this purpose, and work with individual 
universities to implement notice-and-takedown measures. 
 
¶7. (SBU) Local rights-holder groups, however, told econoff on 
September 2 that they remain worried that the MOE may try to have 
the LY reinsert language that would exempt TANet from the bill's 
provisions.   Rights-holder also told econoff they are still not 
satisfied with the MOE's efforts under the Action Plan.  According 
to Robin Lee of the recording-industry group IFPI, the MOE's new, 
bi-monthly reports do provide general information and statistics 
about how infringement complaints are being handled by individual 
universities, but the reports do not provide specific feedback about 
how each complaint is being handled or punished, rendering the 
reports "almost useless." Representatives from the software, movie, 
and book-publishing rights-holder groups agree with Lee that 
although the MOE has designated an infringement-complaints POC, the 
Ministry does not have adequate staff to address the industry's 
problems on TANet.  Rights-holders told econoff that they have asked 
MOE to establish an enforcement group within the Computer Center. 
 
----------------------------- 
IP Court Has Slow First Month 
----------------------------- 
 
¶8. (SBU) Opened with fanfare on July 1 (ref B), the Taiwan 
Intellectual Property Court had a lower-than-expected caseload 
during it first two months.  IP Court President Kao Shiow-jen 
recently told econoff the IP court has received only 146 cases, 
mostly criminal appeals and administrative cases, none of which have 
reached the trial stage.  Kao said the IP Court is disappointed by 
the low number of cases received, especially first-instance civil 
cases, since the Judicial Yuan (JY) estimates the Court is able to 
handle about 250 cases per month.  Kao explained many plaintiffs in 
civil cases are still watching and considering whether to use this 
new venue, or file their cases as before in a district court.  Kao 
believes that more plaintiffs will take their civil complaints 
directly to the IP court when they realize the Court's judges can 
effectively and correctly enforce Taiwan's patent, trademark, and 
copyright laws. 
 
------- 
Comment 
------- 
 
¶9. (SBU) We assess that Taiwan continues to make measurable progress 
on the key areas outlined by the U.S. in this year's Special 301 
Watch List submission for Taiwan. As we noted in ref C, the main 
remaining issue is Taiwan's progress toward passing an acceptable 
version of the ISP amendment.  Rights-holder groups, ISPs, and 
web-portal operators all tell us that they can live with the 
amendment's current wording, although rights-holder groups would 
prefer that the final version include "Article 88" language clearly 
referencing secondary liability, and also worry that the MOE may try 
to have language reinserted into the bill that would exempt TANet 
from its requirements.  We have already requested a written 
expression of support for the bill's passage (ref E), and we will 
follow up with EY officials to encourage Taiwan to pass as strong a 
bill as possible.  If MOEA continues to support the bill's passage 
in its current form, we recommend that Taiwan be removed from the 
301 Watch List at the end of the out-of-cycle review. End comment.