VZCZCXRO6119
RR RUEHNZ
DE RUEHWL #0059/01 0610155
ZNR UUUUU ZZH
R 020155Z MAR 09
FM AMEMBASSY WELLINGTON
TO RUEHC/SECSTATE WASHDC 5778
INFO RUEHNZ/AMCONSUL AUCKLAND 1925
RUEHBY/AMEMBASSY CANBERRA 5462
RUEHDN/AMCONSUL SYDNEY 0804
RUCPDOC/USDOC WASHDC 0281
RUEATRS/DEPT OF TREASURY WASHDC
RUEHRC/DEPT OF AGRICULTURE WASHDC

UNCLAS SECTION 01 OF 03 WELLINGTON 000059 
 
SENSITIVE 
SIPDIS 
 
STATE FOR STATE FOR EAP/ANP, EEB/TPP/IPE TMCGOWAN, STATE PASS TO 
USPTO, USTR JENNIFER GROVES AND COMMERCE FOR CASSIE PETERS 
ITA/MAC/OIPR 
 
E.O. 12958: N/A 
TAGS: ECON ETRD KIPR NZ
SUBJECT: 2009 SPECIAL 301 REVIEW - NEW ZEALAND 
 
Ref: State 8410 
 
¶1. (U)  Summary:  Post recommends that New Zealand (GNZ) not/not be 
placed on the Special 301 List in 2009.  New Zealand has a 
comprehensive Intellectual Property Rights (IPR) regime that strives 
to meet its WTO TRIPS obligations with respect to patents, copyright 
and trademark protection, and has in recent years amended and 
updated a number of pieces of intellectual property legislation.  A 
new Patents Bill was introduced to Parliament on July 9, 2008 and 
will, when enacted, replace the 1953 Patents Act.  It is expected 
that the Bill will be in force by late 2009.  The Copyright (New 
Technologies) Amendment Act was passed in April 2008 and most of its 
provisions came into force by October 2008.  Full implementation 
with respect to digital data protection via the internet is expected 
by the end of March 2009.  The New Zealand Government has 
proactively cooperated with and values the opportunity to work 
constructively with the United States in a number of international 
IPR fora.  It was one of the first countries to join the U.S. in 
developing the Anti-Counterfeiting Trade Agreement (ACTA) and 
remains a fully engaged member of the WTO TRIPS Council.  Placing 
New Zealand on the Special 301 list may prove to be 
counter-productive as it likely will result in a defensive rather 
than consultative exchange.  End summary. 
 
Access to Pharmaceuticals 
------------------------- 
 
¶2. (SBU)  While the U.S. pharmaceutical industry (PhRMA) urges that 
New Zealand be placed on the priority watch list (PWL) in 2009, Post 
continues to believe that the industry's concerns with regard to 
access to New Zealand's market stem primarily from the cost 
containment strategies for subsidized drugs that are a part of the 
National Medicines Strategy (NMS).  The government-affiliated 
Pharmaceutical Management Agency (PHARMAC) is mandated to spend less 
than its budget allows, and the U.S. pharmaceutical industry may 
have a number of legitimate complaints about its treatment in 
PHARMAC's purchasing process.  However, these industry concerns are 
not IP problems per se.  While Post will continue to work to improve 
access for U.S. pharmaceuticals in the New Zealand market, we 
believe this should be dealt with as a market-access barrier and not 
as a failure to protect intellectual property. 
 
¶3. (U)  In October 2005, the United Future Party announced that it 
had secured an agreement from the Labour Party to develop a national 
medicines strategy as part of Labour's coalition negotiations to 
form a government.  Following extensive consultation, the Government 
released its improved access to medicines strategy ("Medicines New 
Zealand"), and an associated action plan in December 2007.  The 
strategy is intended to provide a framework to support a sound and 
transparent decision-making process enabling greater access to 
"appropriate" medications.  The strategy is also based on principles 
of equity, effectiveness, confidence, value for money, affordability 
and transparency and aims to deliver a coherent approach to 
medicines issues in New Zealand.  The plan's goal is to provide the 
highest quality, safest and most effective medicines for New 
Zealanders. 
 
¶4. (U)  With the election of the National Party in November 2008, 
the United Future Party again secured commitment to the strategy 
through its supply and confidence agreement as a coalition minority 
party.  Therefore, the New Zealand Government remains committed to 
working with stakeholders to investigate ways to improve access to 
higher-cost specialized medicines, and has recently announced it 
would increase spending on medicines by NZ$180 million over the next 
three years, starting July 2009.  There are currently no undue 
delays in assessing applications for market authorization in New 
Zealand.  The New Zealand Government's Medicines and Medical Devices 
Safety Authority (Medsafe) is already meeting its goal of assessing 
applications for market access within 200 days of receipt. 
 
Patent Protection 
----------------- 
 
¶5. (U)  The grant of patents in New Zealand is currently governed by 
the Patents Act 1953.  A new Patents Bill was introduced to 
Parliament on July 9, 2008 and will, when enacted, replace the 1953 
Act.  The Bill will be referred to a Select Committee for review in 
early 2009, which will likely seek public submissions as part of its 
consideration of the new law by May and is expected to be in force 
by end of 2009.  The Patent term will remain at twenty years from 
filing with no provision for extension. 
 
 
WELLINGTON 00000059  002 OF 003 
 
 
¶6. (U)  The Patents Bill requires that, to be patentable, an 
invention must be a "manner of manufacture", be novel, involve an 
inventive step, and be useful.  The Bill excludes certain subject 
matter from patent protection: 
 
--Human beings and biological methods for their generation; 
 
--Methods of treatment of human beings by surgery or therapy, or 
methods of diagnosis practised on human beings; 
 
--Inventions whose commercial exploitation would be contrary to 
morality or public policy; 
 
--Plant varieties. 
 
¶7. (U)  The "prior art base" for novelty and inventive steps 
includes all material made available to the public in any form 
anywhere in the world.  This replaces the "local" novelty standard 
applied under the 1953 Act.  Patent applications will be examined 
for inventive step and utility; there is no examination for these 
criteria under the 1953 Act.  The Bill will remove the 1953 Act 
provision for pre-grant opposition and will introduce a 
"re-examination" provision which can be invoked at any time after 
acceptance of an application.  Re-examination will be limited to 
issues of novelty and inventive step based on documentary prior art. 
 The 1953 Act post-grant opposition provisions will be expanded and 
it will be possible to invoke post-grant opposition at any time 
during the patent term.  The current provision for revocation of a 
patent through the courts will be retained.  The Bill also provides 
for the establishment of a Maori Advisory Committee to advise the 
Commissioner of Patents where patent applications involve 
traditional knowledge and indigenous plants and animals. 
 
The Copyright (New Technologies) Amendment Act 2008 
--------------------------------------------- ------ 
 
¶8. (U)  The Copyright (New Technologies) Amendment Act was passed in 
April 2008 and most of its provisions came into force in October of 
that year.  A number of changes were made to the Bill following its 
report back from the Select Committee and prior to its final passage 
through Parliament.  In particular, changes were made to the 
Internet Service Provider (ISP) liability provisions in response to 
public concerns.  Modifications included: 
 
-- An ISP will not be protected from liability if it has reason to 
believe that material on its clients' websites is infringing, 
regardless of whether they have received a notice from a 
rights-holder to that effect; 
 
-- A requirement for ISPs to have and reasonably implement a policy 
for termination of the accounts of repeat infringers was inserted 
into the Bill; and 
 
-- The offence provision for sending false or misleading notices to 
ISPs which was inserted at Select Committee was removed from the 
Bill. 
 
¶9. (U)  On February 23, five days prior to the full implementation 
of the ISP provisions (sections 92 a and c) in the new Copyright 
Bill, Minister of Commerce Simon Power suspended the ISP sections of 
the law from coming into full force for 30 days (end of March 2009). 
 The Minister's action will give the IP rights holders represented 
by the Recording Industry Association of New Zealand (RIANZ) and the 
Australasian Performing Rights Association (APRA) additional time to 
negotiate with the ISP trade association, the Telecommunication 
Carriers Forum (TCF) a mutually agreeable code of practice for 
terminating the internet access of users accused of infringing 
copyrights.  Once the code of practice is adopted, the government 
will monitor its efficacy during the first six months after the 
law's enactment. 
 
¶10. (U)  The provisions relating to technological protection 
measures (TPMs) remain largely unchanged in the bill.  The Act as 
implemented reflects New Zealand's concern that TPMs should not be 
protected to the extent that they restrict acts which are seen as 
not protected by copyright law.  The provisions of the Act have 
therefore been drafted to ensure that access to a work for 
non-infringing purposes, including the exercise of a permitted act, 
is retained. 
 
The Trademarks (International Treaties and Enforcement) Bill 
----------------------------------------- 
 
WELLINGTON 00000059  003 OF 003 
 
 
 
¶11. (U)  The Trademarks (International Treaties and Enforcement) 
Bill was introduced to Parliament in 2008.  The Bill contains 
provisions to enhance the existing enforcement provisions in the 
Trade Marks Act and Copyright Act 1994 to further deter 
counterfeiting of registered trade marks and piracy of copyright 
protected works.  The Bill is expected to be referred to a Select 
Committee in 2009. 
 
Enforcement 
----------- 
 
¶12. (U)  The GNZ remains committed to enforcing its IP laws 
adequately and effectively.  In most instances, the government 
responds to complaints raised by rights holders against IP 
infringers.  The government set up a new office within New Zealand 
Customs in 2007 that is exclusively dedicated to IP enforcement 
issues.  Currently, New Zealand Customs can confiscate and destroy 
pirated products if the holder of the trademark or copyright has 
requested that Customs detain the goods.  That request is valid for 
five years and can be renewed.  Almost all the infringing goods 
imported into New Zealand originated in Asia, particularly China. 
While it appears that CDs and DVDs are increasingly being copied to 
order within New Zealand (over the internet), making detection of 
local production increasingly difficult, the copyright industry has 
an ongoing cooperative dialogue with local authorities to better 
police IPR as new forms of piracy are detected. 
 
Anti-Counterfeiting Trade Agreement 
----------------------------------- 
 
¶13. (U)  New Zealand joined with the United States and a number of 
its major trading partners, including the Australia, Canada, the 
European Union, Japan, Korea, Mexico, and Switzerland, to help in 
the development of the plurilateral Anti-Counterfeiting Trade 
Agreement ("ACTA").  The government of New Zealand has made several 
public statements regarding ACTA, saying "it would establish a new 
international legal framework with the goal of setting a new, higher 
benchmark for intellectual property rights enforcement."  At the 
fourth negotiating round in Paris in December 2008, New Zealand 
reaffirmed its commitments to negotiate an agreement to combat 
global infringements of IPR, particularly in the context of 
counterfeiting and piracy, by increasing international cooperation, 
strengthening the framework of practices that contribute to 
effective enforcement, and strengthening relevant IPR enforcement 
measures themselves. 
¶14. (U)  Recommendation:  Post maintains that, despite delays in the 
pending Copyright Bill's ISP provisions and the Patents Bill's 
slowed progress because of last year's election cycle, there remains 
a strong commitment on the part of the GNZ to continue to improve 
its IP regime and bring it into conformance with international 
standards.  The GNZ's enforcement of current IP laws also reflects 
the government's proactive stance as they learn and adapt to help 
stem new forms of piracy.  While there is additional work to be done 
to strengthen the law and enhance enforcement, Post recommends the 
better course of action is to continue engagement with the GNZ and 
monitor the progress of IP legislation rather than place New Zealand 
on this year's watch list.  End Recommendation. 
KEEGAN