The United States has put South Africa on a list of the worst infringers of copyright and trademarks
Paul Kirk
South Africa may soon face the possibility of United States trade sanctions unless the country cleans up its act with regard to trademark and copyright violations.
According to a major international body that polices trade in counterfeit goods, up to 75 % of the South African computer programme market is made up of pirated products.
The Washington-based International Anti-Counterfeiting Coalition (IACC) carries massive political clout and delivers training on counterfeit goods and piracy to American government agents on behalf of their government. Representing international businesses the IACC’s members have a combined turnover of $650-billion a year. Not surprisingly, most of the IACC’s members are based in the US.
Formed to protect US intellectual property rights and revenues the main weapon the IACC has at its disposal is Section 301 of the US Trade Act of 1974. In terms of this act the US can impose trade sanctions on countries that contravene trade agreements or do not respect intellectual property rights. Sanctions are imposed by the office of the US Trade Representative and based largely on IACC advice.
The Mail & Guardian has obtained a copy of a letter written by IACC president Timothy Trainer to the office of the trade representative, dated February 16 and addressed to Sybia Harrison, the special assistant to the Section 301 committee.
The letter recommends South Africa be placed on a “Watch List” along with several other countries including Japan, Argentina, Chile and Indonesia.
The letter maintains that, among other things:
l “Acts of counterfeiting and piracy pose a clear and present danger to consumer health and safety, cause economic harm, defraud consumers and constitute unfair competition to legitimate business.”
l “The lucrative trade in counterfeit and pirate products attracts organised crime and provides organised crime with revenues for other nefarious activities.”
l “Pirate and counterfeit products are typically of inferior quality and sometimes dangerous. Unfortunately, purchasers of fakes often mistakenly attribute this poor quality to the legitimate brand owner, hurting the brand owner’s reputation with the consuming public.”
The letter then goes on to claim that up to 75 % of the South African computer programme market is made up of pirated computer programmes.
The report continues: “Internet piracy is increasing, corresponding to improvements in the communications infrastructure and increased computer ownership by businesses and individuals. IACC members estimate that unauthorised free downloading directly from the Internet and ‘burn-to-order’ CD-
writing ‘businesses’ account for 20% of the domestic software market.”
The report continues that South African copyright registration is a slow and expensive system that is simply not suitable for many computer games that have a shelf life of only a few years.
While some computer games have a lifespan of only a year or so, the IACC claims that the trademark registration process in South Africa is so slow that it takes up to three years to register a trademark.
While the Counterfeit Goods Act of 1997 provides police with extended powers to confiscate counterfeit goods, the act is not being enforced properly, the report notes.
Trainer said until South Africa tightens up on border control, begins to implement the Counterfeit Goods Act of 1997 and begins to train police and justice officials on the Act, the country should remain on the Watch List the first step toward the US imposing trade sanctions against the country.
And, while the effect will be to ensure US profits, a representative for the IACC insisted that the move is also founded on a need to protect consumers.
“Bear in mind that we have come across cheap knock-offs of mission-critical passenger aircraft parts as well as inferior-quality brake pads for buses and public transport. The consumer needs protection as much as the intellectual property owner,” the representative said.
But while South Africa may soon face sanctions in theory, in practice it is most unlikely. Included in the list of naughty nations with regard to software violations is long-time US ally Canada.
The South African Department of Trade and Industry (DTI) says it is going all out to protect patents and copyrights. A national inspectorate operates within the department and is tasked with carrying out investigations into a number of trade- related issues.
Director of the inspectorate, Lana van Zyl, said while the department was involved in a number of investigations relating to the Counterfeit Goods Act, the only person who could really comment on the US findings was MacDonald Netshitenzhe of the Patents and Trademarks Office also attached to the DTI.
Netshitenzhe was in an urgent meeting at the time of going to press and could not be contacted. Officials in his office told the M&G they were aware of the US findings which were being taken seriously.