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DE RUEHGP #1245/01 3620603
ZNR UUUUU ZZH
R 280603Z DEC 09
FM AMEMBASSY SINGAPORE
TO RUEHC/SECSTATE WASHDC 7587
RUCNASE/ASEAN MEMBER COLLECTIVE
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RUEHRC/USDA FAS WASHDC

UNCLAS SECTION 01 OF 06 SINGAPORE 001245 
 
STATE PASS USTR FOR AUSTR WEISEL, DBISBEE, JMCHALE 
COMMERCE FOR MHOGGE 
 
SIPDIS 
 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: ETRD ECON EFIN EINV ECPS SENV EAGR KTEX KIPR SN
 
SUBJECT:  SINGAPORE FTA REVIEW REVEALS PROGRESS IN SOME AREAS, DEAD 
STOPS IN OTHERS 
 
REF:  08 SINGAPORE 1168 (2008 FTA Review) 
 
¶1.  (SBU) Summary:  Singapore and U.S. trade officials noted 
progress in resolving outstanding trade issues during an annual 
review of the 2004 U.S.-Singapore Free Trade Agreement (FTA).  The 
review saw positive developments in the processing of two textile 
short supply requests, initiatives under the FTA's environmental 
plan of action, and the final resolution of one intellectual 
property rights issue.  The review also covered new ground with a 
proposal to collaborate on labor issues, and discussion of a new 
barrier to providing educational services in Singapore.  Discussions 
foundered on customs record keeping requirements and rules of origin 
issues as they related to optical components as their resolution 
would require fully reopening the agreement.  The review also 
clarified questions regarding Singapore's broadband initiative and 
agriculture policy toward market access for U.S. beef.  End 
Summary. 
 
¶2.  (SBU) U.S. and Singapore trade officials conducted the fifth 
annual review of the U.S.-Singapore Free Trade Agreement (FTA) 
December 4 (December 3 Washington time) via digital videoconference. 
 Assistant U.S. Trade Representative Barbara Weisel led the 
discussion for the U.S. side, with Deputy Secretary KOH Lin-Net of 
the Ministry of Trade and Industry leading for Singapore.  Ms. 
Weisel said she was pleased that there had been movement toward 
resolving some longstanding issues related to the FTA in the past 
year. 
 
Textiles 
-------- 
 
-- Short Supply Requests (GOS) 
-- Tariff Preference Level (TPL) proposed changes (GOS) 
-- Customs and Border Protection (CBP) proposed changes (GOS) 
 
¶4.  (SBU) Gail Strickler, Assistant USTR for Textiles said that USTR 
had signed off November 24 on Singapore's second short supply 
request for textile imports made since the FTA went into effect. 
She expected that after a 60-day consultation and layover period 
USTR would be able to implement the changes, barring any objections 
raised during the process. 
 
¶5.  (SBU) On a third short supply request, Ms. Strickler said that 
USTR was moving ahead, but noted complicating factors in that a 
number of items identified in Singapore's request were not 
recognized as such in the Harmonized Tariff System (HTS).  The U.S. 
does not differentiate fabrics made from bamboo and recycled 
polyester when the final product cannot be considered distinct from 
similar fabrics.  Strickler emphasized the complexity of the request 
procedure, and the amount of work and interagency coordination 
necessary to approve a request.  She conveyed her hope that 
Singapore's short supply requests were important for Singapore's 
textile exporters, noting that Singapore had yet to use any of the 
additional export benefits from its first short supply request.  Mr. 
ANG Kin Leong, MTI Senior Assistant Director, said the third request 
was meant to be forward-looking as Singapore textile manufacturers 
were looking to use more environmentally-friendly fabrics in the 
future. 
 
¶6.  (SBU) DepSec Koh brought up Singapore's long-standing request to 
increase tariff preference levels included in the FTA, reiterating 
the importance to the commercial viability of Singapore's textile 
manufacturers.  She said that Singapore's industry was small and 
accounted for only a little more than one percent of U.S. imports. 
She asked USTR to convey its concerns to the U.S. textile industry 
and request their support. 
 
¶7.  (SBU) Regarding CBP's proposed rulings on two textile matters 
that may affect Singapore, Strickler said that USTR had passed all 
technical information to CBP and hoped to see a decision soon.  She 
emphasized that CBP is an independent agency with its own 
procedures. 
 
Government Procurement 
---------------------- 
 
-- Implementation of Buy American provisions (GOS) 
 
¶8.  (SBU) DepSec Koh said that Buy American provisions in the 
American Recovery and Reinvestment Act (ARRA) had impacted Singapore 
companies doing business in the United States.  Koh said that 
dealing with government procurement at the state level was already 
difficult and that adding in the Buy American provisions made it 
even more complex.  She mentioned a Singapore company called Terrace 
 
SINGAPORE 00001245  002 OF 006 
 
 
Global that had bid on a project in Phoenix, AZ, that was delayed 
for two months due to uncertainty over how the Buy American 
provisions would affect the investment.  She requested a list of 
contacts at the state level to facilitate participation in 
procurements, and offered to give a list of priority states where 
Singapore companies were most interested.  Jean Grier, USTR Senior 
Procurement Negotiator, responded that the United States had been 
careful in the drafting of the ARRA to ensure we abided by our 
international commitments.  Grier provided the website 
www.naspo.org, the website of the National Association of State 
Procurement Officers, which provides contact information for each 
state.  She said USTR could consider developing a list of state 
contacts for government procurement, but in the meantime Singapore 
officials could contact USTR for any assistance with individual 
states. 
 
Education Services 
------------------ 
 
-- Private Education regulatory changes (USG) 
 
¶9.  (SBU) Amanda Horan, USTR Director for Services and Investment, 
explained U.S. concerns over new registration criteria for private 
education providers in Singapore.  While noting that the United 
States does not object to Singapore's efforts to raise educational 
quality standards through the new registration criteria, Horan 
expressed concern at the lack of transparency in how the new 
criteria were being applied.   Singapore's Ministry of Education 
(MOE) had denied applications from two U.S. universities to extend 
educational services in Singapore but had not explained what the 
universities had lacked nor what they would need to improve in order 
to qualify.  YAH Shze Min, MTI Senior Assistant Director, explained 
that in recent years the education landscape in Singapore had 
expanded rapidly resulting in a wide variation in standards.  She 
countered that the criteria for approving private education 
providers was clear and provided online at www.moe.gov.sg/events/ 
private-education-public-consultation/.  Yah asserted that the MOE 
considered a number of factors including the status of the foreign 
university, its track record in providing services in other 
countries, national rankings, GMAT scores, and graduation rates. 
She insisted the criteria were applied transparently and objectively 
to all universities, including Singapore schools.  Horan explained 
that while the criteria themselves may be clear, the specific 
reasons why MOE rejected the two schools remained unclear despite 
several requests to MOE for clarification.  The two universities in 
question had been providing services in Singapore for ten to fifteen 
years respectively without complaint.  The two sides agreed to 
continue to discuss U.S. concerns. 
 
Environmental Cooperation 
------------------------- 
 
-- Arowana Dragonfish market access (GOS) 
-- Review of activities completed in 2009 (USG/GOS) 
 
¶10.  (SBU) Singapore reiterated its request for market access for 
Singapore's farm-raised Arowana Dragonfish whose exports to the 
United States are restricted under the Endangered Species Act. 
David Brooks, USTR Director for Environment Affairs affirmed that 
progress had been made to find a means to support Singapore's 
efforts to meet the standard in the Endangered Species Act that 
allows imports of endangered species only if it serves to assist in 
the conservation of that species.  Dr. Roddy Gable, Chief of the 
Division of Management Authority at the U.S. Fish and Wildlife 
Service (FWS) International Affairs office, stated that Conservation 
International, a non-profit organization soon to open an office in 
Singapore, could facilitate linking Arowana producers in Singapore 
with wild Arowana conservation programs in the region. (Note:  There 
are no wild Arowana in Singapore and no local conservation 
opportunities.)  Singapore will provide a point of contact to USTR 
that can be forwarded to FWS and Conservation International to begin 
discussing how to incorporate Singapore in regional conservation 
efforts. 
 
¶11.  (SBU) On environmental cooperation, Alan Lowther from the State 
Department Office of Environmental Policy read a statement 
previously agreed by Singapore and the United States outlining 
environment cooperation activities completed in 2009.  Completed 
activities included:  a March digital video conference between the 
Environmental Protection Agency (EPA) and the Singapore National 
Environment Agency (NEA) regarding energy efficient laboratory 
initiatives (Labs 21); an NEA study visit to the United States 
regarding terrain decontamination, air quality management and 
hazardous waste management; and Singapore participation in a 
 
SINGAPORE 00001245  003 OF 006 
 
 
regional dialogue on trade in wood products that was held in Jakarta 
in September.  The United States plans to continue the regional 
dialogue on trade in wood products and would likely organize another 
event in April or May 2010, USTR's Brooks stated.  NEA is interested 
in expanding cooperation on air quality management to include 
sending an NEA official on a temporary detail to a U.S. facility. 
NEA also intends to provide EPA with its proposal for Labs 21 
cooperation in the first quarter of 2010, said LEE Choon Phua, 
Assistant Director at the Ministry of Environment and Water 
Resources. 
 
¶12.  (SBU) Singapore and the United States continue to discuss 
opportunities to arrange training seminars in Singapore on wildlife 
crime investigations and responding to marine pollution caused by 
ships.  The United States and Singapore will hold the biennial 
review of the 2008-2010 environment Plan of Action in 2010 and will 
revise and update the Plan of Action to take effect 2011-2012. 
Subsequent biennial reviews will be held each even-numbered year. 
 
Labor 
----- 
 
¶13.  (SBU) Carlos Romero, Deputy Assistant USTR for Labor Affairs, 
said that the United States and Singapore had had little cause for 
interaction on labor issues in the past, but saw the bilateral 
cooperation on environmental issues under the FTA as a model for 
discussing labor issues.  There are opportunities to learn from each 
other on handling labor issues, Romero said.  More importantly, 
Singapore, the United States and other countries with similar views 
on labor could speak with one voice in multilateral fora to other 
countries with lesser developed labor regimes on labor issues as 
they relate to trade.  Susan Hahn of the Department of Labor offered 
to meet with Ministry of Manpower counterparts on areas of mutual 
interest.  SIM Li Chuan, Head of International Labor at the Ministry 
of Manpower, said he looked forward to any cooperative activities 
between the two Departments. 
 
Intellectual Property Rights (IPR) 
--------------------------------- 
 
-- "Simulcasting" issue resolution (USG) 
-- Deterrent penalties for IPR violations (USG) 
-- Collaboration between IPRB and IPR rights holders (USG) 
-- Pre-discovery process for authorized agents (USG) 
-- Cooperation from ISPs in addressing Internet piracy (USG) 
-- Anti-camcording legislation (USG) 
 
¶14.  (SBU) Simulcasting:  Rachel Bae, USTR Director for Intellectual 
Property Rights, praised the successful conclusion of "simulcasting" 
fee negotiations between the recording industry and MediaCorp, 
Singapore's dominant radio broadcaster.  MediaCorp became the first 
Singapore broadcaster to conclude a licensing agreement with the 
recording industry to simultaneously broadcast radio transmissions 
over the Internet, bringing to a close a long-standing FTA issue. 
 
¶15.  (SBU) Deterrent Penalties:  USTR conveyed long-standing 
industry concerns that penalties for end-user piracy are 
insufficient to deter copyright infringers, which is inconsistent 
with FTA obligations.  Bae cited the outcome of the PP v PDM case, 
in which the maximum fine faced by Singapore firm PDM was S$40,000 
while the value of their copies of infringing software was more than 
S$78,000.  Maximum fines for copyright violations should be 
increased and brought in line with penalties for other forms of IPR 
violations (e.g., trademark infringement), Bae said.  Senior 
Assistant Director at the Intellectual Property Rights Office of 
Singapore (IPOS) Kelvin Sum disagreed that Singapore does not set 
high enough penalties for end-user piracy and asserted that the 
fines in that specific case did not indicate a trend and were 
determined by mitigating factors, such as PDM's cooperation with the 
investigation. 
 
¶16.  (SBU) Bae said that according to industry, the Attorney 
General's Chambers (AGC) has dismissed other similar end-user piracy 
cases, so there is no way to determine a trend.  Daren Tang of the 
AGC said that prosecution of such cases depends on the evidence 
presented and that the GOS does not, as a policy, choose not to 
prosecute.  Bae requested more information about why the AGC 
dismissed end-user piracy cases against Singapore firms Boonty and 
Wang & EF Tan Associates.  IPOS and AGC agreed to try to provide 
additional information, but said it was unlikely they could provide 
more details because of client confidentiality issues. 
 
¶17.  (SBU) Collaboration:  The Intellectual Property Rights Branch 
(IPRB) of the Singapore Police Force has been conducting raids and 
 
SINGAPORE 00001245  004 OF 006 
 
 
collaborating with industry on IPR cases, Sum stated.  Sum disagreed 
with statements by industry that IPRB does not have enough resources 
to actively pursue IPR cases.  Industry has said that IPRB is 
rejecting cases, even after industry has conducted its own 
investigation and provided IPRB with evidence of infringement.  Bae 
noted that the collaborative enforcement model that Singapore 
advocates puts the onus on rights holders to investigate and develop 
cases, which is inconsistent with the FTA, which states that 
non-criminal actions are not the primary means to enforce IPR laws. 
Sum said that as with any government agency in Singapore, IPRB is 
very busy and that IPRB and the AGC use prosecutorial discretion to 
determine which cases to prioritize.  Bae suggested that the issue 
of enforcement might be best covered in a separate follow-on DVC 
focused entirely on IPR issues.  IPOS indicated they supported the 
DVC suggestion. 
 
¶18.  (SBU) Pre-Discovery Process:  Bae sought clarification 
regarding the ability of authorized agents acting on behalf of 
rights holders to apply for pre-action discovery in cases of 
Internet piracy.  Bae cited the case of Odex Pte Ltd v Pacific 
Internet Ltd, in which Singapore courts denied an authorized agent's 
request and said the judge's decision highlighted a possible 
deficiency in Singapore law.  Sum and Tang stated that Singapore has 
a pre-established process that does not allow authorized agents to 
apply for pre-action discovery in their own name.  However, they 
said that if the agent in the Odex case had requested pre-action 
discovery and sued in the name of the principals, the copyright 
holders, their request probably would have been granted.  Bae said 
USTR would inform industry of Singapore's policy as stated in the 
review. 
 
¶19.  (SBU) Internet Piracy:  Bae also raised concerns that internet 
service providers (ISPs) in Singapore are not responding to 
infringement notifications submitted by the recording industry. 
USTR and the GOS agreed that this is an issue between commercial 
parties, but Bae noted that the recording industry is seeking 
assistance through the FTA process because they must maintain a 
positive working relationship with ISPs, and for that reason are 
reluctant to initiate lawsuits as a means to force the ISPs to 
respond.  Sum said that IPOS might be able to consider some way to 
encourage collaboration between ISPs and rights holders, but 
suggested that IPOS and USTR might discuss it further in later 
conversations or the follow-on DVC. 
 
¶20.  (SBU) Anti-Camcording:  Bae inquired whether Singapore would 
consider enacting anti-camcording legislation, noting that 
neighboring countries like Thailand are moving forward with laws to 
address unauthorized camcording in movie theaters and other public 
venues.  Singapore lacks legislation that deals with unauthorized 
camcording or persons caught camcording.  Sum stated that the two or 
three cases of camcording in Singapore do not indicate a trend. 
Singapore will study the camcording laws in other countries before 
considering its own legislation.  Singapore already has laws that 
address other violations, such as reproduction and distribution of 
pirated films, Sum added. 
 
Standard Drug List 
------------------ 
 
¶21.  (SBU) Assistant USTR Weisel said that she understood that the 
Singapore Ministry of Health was working with industry to have 
fuller discussions on the means by which the Ministry chooses 
pharmaceutical products to include on its Standard Drug List (SDL) 
of drugs considered effective and should be made affordable to 
patients through subsidies.  She said the newly instituted annual 
review of the SDL was a welcome step and encouraged the Ministry to 
continue to engage in dialogue with industry stakeholders.  Suwarin 
Chaturapit, Director at the Health Sciences Authority, said that the 
Ministry would continue to review the SDL.  She noted that health 
care professionals had the key role in promoting drugs to be 
included on the list, and recommended that companies speak to health 
professionals about the benefits of their products to encourage 
consideration of their inclusion on the SDL. 
 
Telecommunications 
------------------ 
 
¶22.  (SBU) Rachelle Lee, Assistant Manager in the Infocomm 
Development Authority, gave an update on the rollout of Singapore's 
next generation broadband network.  She relayed that the operating 
company, Nucleus Connect, would begin to deploy services during the 
first half of 2010 with all universal service obligations completed 
by 2013.  The broadband provider would offer last-mile access at 
between 100 mps and one gigabit/second, virtual private networks and 
 
SINGAPORE 00001245  005 OF 006 
 
 
virtual leased lines.  Jonathan McHale, Deputy Assistant USTR for 
Services, requested a copy of IDA's economic analysis that 
recommended the use of government subsidies to support development 
of the new network. 
 
Agriculture 
----------- 
 
-- Market access for U.S. beef 
 
¶23.  (SBU) David Bisbee, Deputy Assistant USTR for Southeast Asia 
and the Pacific, noted that at the 2008 FTA review Singapore 
officials had said they were conducting a risk assessment of U.S. 
beef and beef products.  According to the World Organization of 
Animal Health (OIE) U.S. beef is considered safe; any restriction on 
its import must be accompanied by a scientifically-based risk 
assessment that justifies stricter standards.  Oscar Ferrera, 
International Trade Specialist at the U.S. Department of Agriculture 
(USDA), said he had seen no information on Singapore's risk 
assessment in the past year and offered any assistance necessary to 
help complete it.  With a risk assessment in hand, USDA could better 
address Singapore's concerns.  Adrian Goh, Senior Assistant Director 
at MTI, said that as a food importer Singapore had no interest in 
suspending imports any longer than necessary, but that Singapore's 
Agri-Food and Veterinary Authority (AVA) had to ensure the safety of 
the country's food supply.  He said that Singapore had already 
reopened the market to boneless beef from cows less than 30 months 
of age, but has not seen sufficient evidence that bone-in beef is of 
no additional risk and therefore continued to block imports.  AVA 
was not present at the FTA review, but DepSec Koh said that 
Singapore could not commit to a timeline to complete the assessment. 
 Koh agreed that AVA and USDA should hold discussions on the topic. 
 
Dispute Settlement 
------------------ 
 
¶24.  (SBU) Derek Loh, State Counsel in Singapore's Attorney 
General's Chambers, thanked USTR for its proposal to establish a 
list of panelists for a five-person dispute settlement panel.  Under 
the proposal, each side would nominate five panelists, then meet to 
review and narrow the list to only five total.  Both sides would 
regularly review the panel. 
 
Customs 
------- 
 
-- Record Keeping Requirement 
 
¶25.  (SBU) TAY Chng Yeow, Director (FTA) at the Ministry of Finance, 
pitched a change in CBP record keeping requirements of importation 
records from five to three years.  He explained that the requirement 
was a particular burden on small and medium-sized enterprises. 
DepSec Koh said most of Singapore's FTAs included only a three year 
requirement, and said that other countries, including members of the 
TPP Agreement, also had three year record keeping requirements. 
Deputy AUSTR Bisbee said that USTR had consulted CBP and Treasury 
regarding the requirement, but both agencies reiterated that the 
five-year requirement has been an important component of U.S. FTAs 
and should stand as is.  Given that the requirement had been agreed 
upon at the original FTA negotiations, USTR was not inclined to 
reopen the agreement to grant Singapore's request. 
 
Rules of Origin 
--------------- 
 
-- Optical Components 
 
¶26.  (SBU) Deputy AUSTR Bisbee said USTR had examined Singapore's 
proposal to change the rules of origin for imports of optical 
components from Singapore, but that the rules of origin in the FTA 
had been carefully crafted and represented an integral part of the 
overall balance of the agreement.  The process for changing rules of 
origin was a lengthy and complicated one and not one that USTR would 
embark on lightly.  DepSec Koh said that although Singapore had 
agreed to the rules of origin for these products, Singapore industry 
now found the rules onerous and was unable to export with the 
current rules in place.  The U.S. took note of these views, but 
maintained that the U.S. is not in a position to consider revising 
the rules of origin at this time.  Singapore was invited to provide 
additional information to USTR regarding any changes in the industry 
that might have a bearing on this issue. 
 
¶27.  (U) USTR cleared this cable. 
 
 
SINGAPORE 00001245  006 OF 006 
 
 
SHIELDS