Special Report: Strictly Business: US IP Attachés Report Home

WASHINGTON, DC – Last week was ‘old home week’ for officials in the United States intellectual property attaché program, as they returned before the holidays from their posts around the world. Speaking publicly, the officials gave mixed reports on the fight to advance IP rights worldwide. They also heard harsh but determined words about the situation in Geneva from the industry perspective. Two more attaché offices will open next year, and several attachés last week called for an elevation in their rank in order to enable them to have access to higher level officials in other countries.

The US Patent and Trademark Office Intellectual Property Rights Attaché Program was formed in 2006 to “promote high standards of IP protection and enforcement internationally for the benefit of U.S. stakeholders,” it states.

Since 2007, US IP attachés have gathered for a week of consultations at the USPTO in Alexandria, Virginia. This year, it took place during the week of 15 December, according to US Commerce Department press release. And in the previous week, five of the 11 officials met with the public, technology companies, law associations and universities in San Francisco and San Jose (Silicon Valley). The five officials making the west coast trip are posted in Brazil, China, India, Mexico and Thailand. They were joined by the head of the attaché programme, Dominic Keating.

Last week’s activities included a public appearance in Washington, DC, at the 8^th annual IP Attaché Roundtable at the US Chamber of Commerce industry association. The Chamber Global Intellectual Property Center (GIPC) roundtable was webcast, archived here.

The IP attaché program “Really protects and promotes our intellectual property around the world,” said Patrick Kilbride, director for international intellectual property at the Chamber, said in opening the roundtable. “It not only works for our members, US industry, I believe it helps to create that culture of innovation that will help to foster intellectual property growth everywhere in the world.”

Their ability to be on the ground and interacting with “thought leaders” there is “a critical part of our diplomacy,” Kilbride said.

“The IP attaché’s fundamental role is to advocate US government policy positions for the benefit of US stakeholders,” said attaché program head Keating.

This is done primarily in three ways, Keating said. First, they advocate directly with host governments, seeking improvements to policies, laws and regulations. The second is to conduct training programs for government officials, whether they are patent examiners, judges, prosecutors or policymakers, helping them to understand the US system, also helping them to understand how to improve their own system, and understand US perspectives on intellectual property issues, he said.

The third way is to conduct public awareness programs to help the public understand US perspectives on intellectual property, why it’s important, why it should be protected, and why it should be respected and enforced. An additional role is to directly assist US stakeholders, he said. Attachés get training from a range of US agencies, and when they return they are reintegrated into the USPTO in order take advantage of the expertise they gained.

Speaking to a business audience at the Chamber, the attachés emphasised their strong business orientation.

11 Current IP Attachés; Brussels, Lima Attachés Coming Soon

The list of attachés around the world has grown to 11, with three in China. Keating said that based on the positive feedback about the programme, they are in the process of slowly expanding the programme. Two more attaché offices have been approved, in Brussels and Lima, Peru, to be opened in 2015.

Current attachés are:

Peter Fowler (Southeast Asia, including the Association of Southeast Asian Nations -ASEAN) Bangkok

Karin Ferriter (US mission to the World Trade Organization) Geneva

Aisha Salem (Middle East and North Africa) Kuwait City

Kristine Schlegelmilch (US mission to the United Nations in Geneva, including World Intellectual Property Organization) Geneva

Joel Blank (Beijing, China) Beijing

Timothy Browning (Guangzhou, China region including Hong Kong) Guangzhou

Michael Mangelson (Shanghai, China region) Shanghai

Michael Lewis (Mexico, Central America and the Caribbean) Mexico

Donald Townsend (Russia and the Commonwealth of Independent States) Moscow

Kalpana Reddy (India and South Asia) New Delhi

Albert Keyack (South America) Rio de Janeiro

 

Frustrations High, but Geneva Not a ‘Lost Cause’ for Industry

Ashley Mergen, manager for trade at the Chamber’s Global IP Center, spoke about the difficult environment for advancing industry pro-IP interests in the international organisations in Geneva.

She referred to a comment from an IP attaché gathering a few years ago that Geneva is a place where “bad ideas go to incubate.” Even today, she said, “frustrations with the multilateral process are running high.” Examples she mentioned were, at the WTO, the trade facilitation agreement (which she said had a surprise “uncollapse”) and the breakdown of the Information Technology Agreement expansion. At WIPO, she mentioned the work plan for patents.

“It’s hard to see the light at the end of the tunnel in Geneva,” said Mergen. “The dialogue especially around IP has gotten shrill. Sometimes from the business perspective, it can feel like a lost cause.”

“But as groups in Geneva look for limitations, exceptions and workarounds to implementing meaningful IP regimes,” she said, “we here at the GIPC believe that the best defence in Geneva is a good offence.” Especially in environments like the United Nations, WTO and World Health Organization, “the great work done by our IP attachés, who are truly on the front lines, cannot be taken for granted,” she said.

“In standing committees where business has been effectively shut out or shouted down, our attachés carry the flag for free market principles like the liberalisation of trade barriers and enhancement of IP rights,” she said.

Mergen said she returned from Geneva earlier in the week and there heard “time and again that business is just not present.” GIPC and its members “have a strong appreciation for the work that is done there and as a practical matter we know we cannot always physically be present,” she said.

“However,” Mergen added, “we can work with the leadership in the multilateral organisations to structure an effective pattern of collaboration that gives them the support they need to fight against the bad ideas which may fester, and gives our companies from the IP rightsholder community a sense of meaningful productive engagement, which could, in kind, attract further interest from the business community.”

“What we’ve learned in Geneva,” Mergen continued, “is that the personnel representing some of the key markets are stretched thin, oftentimes wearing the UN hat in addition to the WTO hat, the WHO hat and god knows what else hat, meaning of course that the expertise in IP in Geneva varies wildly. Sometimes bringing things back to the basics is what these delegations need.”

Mergen gave an example that earlier in the week, the GIPC brought women entrepreneurs to WIPO to share their practical experiences with utilising the US IP system and establishing creative successful businesses. “The takeaway for countries in transition in the audience wasn’t to extoll the US system, but to provide real-life examples of how IP underpins entrepreneurs of all shapes, types and nationalities,” she said.

“We were also told time and again that business-to-delegation exchanges like these are all too rare,” Mergen said, “which puts into perspective that while the rest of Geneva is looking for wins of a grand scale with treaties that span the globe, every single one of these programmes starts with wins of the smaller scale, which plant the seed for multilateral action, serving as a catalyst for innovation.”

US at WTO

Ferriter said she agreed with everything Mergen said. In Geneva, “We’re working hard to have a positive dialogue on intellectual property,” she said.

At the WTO Council for Trade-Related Aspects of Intellectual Property Rights (TRIPS), the US has suggested agenda items it feels will appeal to all countries, such as cost-effective innovation, the importance of programs for small business, and IP and sports, which brought positive interventions from governments not otherwise necessarily supportive of IP rights, she said.

Next year, the US is looking to possibly build on a WIPO program on women entrepreneurs, who are under-represented in the patent community, said Ferriter, adding that they are open to other ideas for topics on which to focus to have a “friendly conversation” about IP. “We are looking for ideas to expand the positive conversation,” she said.

Ferriter also referred to a story she heard, but did not have details on, regarding a meeting of African ambassadors being upset to learn that a software on which a nation’s banking system was based had been stolen.

They are looking for more stories such as that, she said, because they help get other countries to understand the problem IP enforcement and what needs to be done internationally. “We really need those kinds of stories from all over the world,” she said. “We believe the facts are out there,” and that “it will show that intellectual property is a force for good in the world.”

She also reminded participants that the WTO trade policy review process offers opportunities to raise particular issues with countries, and that the TRIPS Council also can be a forum for the US government to raise concerns about another member’s behaviour.

US at WIPO

Schlegelmilch noted some leadership moves in Geneva, including the re-election of WIPO Director General Francis Gurry for six years and the taking office of his top management team, about half of who are new. She also noted the arrival of the new US ambassador to the UN in Geneva, Pamela Hamamoto, who she said is “extremely interested and involved” in WIPO and other IP issues, and approaches them with a business background.

Schlegelmilch said WIPO continues to see growth in the Patent Cooperation Treaty, Madrid System (trademarks) and Hague system (designs). She noted WIPO’s new offices in Beijing and Moscow, but said the path forward on other WIPO external offices is “uncertain” as an agreement will be needed among member states on opening new offices and the issue has become political.

The WIPO Standing Committee on Copyright and Related Rights (SCCR) will continue to discuss a treaty on broadcasters’ rights and on limitations and exceptions for libraries and archives, and for education and research facilities, she said. Also, the final negotiation to conclude a design law treaty have become somewhat uncertain since some member states continue to hold up the move to a diplomatic conference to finish the treaty, Schlegelmilch said.

There will be no meetings in 2015 of the WIPO Intergovernmental Committee on Genetic Resources, Traditional Knowledge and Folklore (IGC), said Schlegelmilch, as members at the annual General Assembly in October could not agree on a work plan. But, she said, the topics of the committee can be expected to come up in other committees over the course of the year, and the subject is expected to be discussed at the next Assembly in September/October 2015.

On geographical indications (GIs) in the context of the WIPO Lisbon agreement on appellations of origin, she said it is anticipated that a diplomatic conference will take place in May on the expansion of Lisbon to cover GIs. She said the US and “many other” member states pushed for the diplomatic conference to open to equal participation, which she claimed has been the trend at WIPO for over 20 years – that all member states participate equally in diplomatic conferences. The US and allies thought it would be important in order to have a “truly international” agreement on GIs be an outcome of the talks, she said.

“Unfortunately, it looks like the negotiation will proceed with only the current 28 members” of Lisbon out of 188 WIPO members. The United States plans to continue to participate “to the greatest extent possible,” as observers, and “we do hope our contributions will help to shape an outcome that is positive and acceptable for all WIPO members.”

Heading into the next biennium, the US “will continue to look for ways to keep the focus at WIPO on IP rather than the many other issues that do seem to come up there,” she said.

“We welcome the presence of all voices, including business,” Schlegelmilch concluded. “It’s very important to hear your voices during the actual negotiation, and we really appreciate those who come and participate as observers in our committee meetings. We think it adds a much-needed dose of reality and hands-on experience to our conversations. We highly encourage it.”

Other Regions

Mexico-based Lewis told the industry gathering the attachés are “a resource” and are “here for you,” a point echoed by a number of others.

He concentrated his comments on Mexico, where he said two-year-old administration has focused on economic reform, such as in the energy, education and telecommunications sectors. The telecom reform is intended to open markets and drive down prices, including for broadband high-speed internet, he said. But he added that expansion of broadband can bring additional IP infringement problems, so the US is working to ensure enforcement goes along with reform.

“Unfortunately, there is a social acceptance” in Mexico toward purchasing counterfeit goods, Lewis said. Such goods are available everywhere and there is no stigma associated with buying them. The Mexican government is working on the problem, he added, conducting public awareness campaigns, but it needs to do more on enforcement. The US embassy is working on the issue, for instance publishing op-ed pieces explaining the importance of intellectual property, he said. But the Mexican government still lacks deterrent penalties, and local-state coordination on investigation and prosecution, Lewis added.

One change occurring in Mexico in the coming year that can be used to advantage, he said, is its transition from a civil law system to an “accusatory” law system. So the US is working to train authorities there to prosecute IP crimes under the new system. He mentioned that the Mexican Institute of Industrial Property is a close ally as its leader is “very pro-IP.”

In Central America, his office is training customs officials and judges on IP rights. In the Caribbean, they are working on “longstanding copyright issues,” he said.

Fowler in Southeast Asia highlighted that ASEAN will at the end of 2015 become a single market, and noted there is no country in the market overwhelmingly dominates the region. He said Singapore is a standout market and hub for western businesses in the region, the Philippines has made significant progress in the past year or two on IP enforcement, Indonesia, which he said has been particularly problematic over the past decade or so, has shown some change in attitude and might see movement under a new administration, and that Vietnam is making real improvements. For Vietnam, the Trans-Pacific Partnership (TPP) negotiations have been a “wake-up call,” he said, and is competitive with its neighbours. Malaysia, meanwhile, is making “incremental” improvements, he said.

The TPP will create a new high-standard benchmark for IP protection, he said, and the four ASEAN countries participating will force the non-TPP members to “up their game” as well, he said. There are efforts toward ASEAN-wide harmonisation of IP procedures too, he said.

The region also has had its disappointments, Fowler said, such as Myanmar, which “has just ground to glacial – and glacial is actually being positive and diplomatic – movement” on IP.

Based in Bangkok, he took aim at Thailand as well. The military coup has set the country “major steps backward” on IP issues. There has been no consideration for concerns raised over passage of IP legislation, he said, and a proposed amendment to the country’s drug law will have “serious implications” for company patents. The amendment would give Thailand’s drug approval authority the ability to deny any registration based on patents, meaning only generics could compete in the market, he said.

And in the case of Brunei Darussalam, he commented that the country’s recent harsh sharia law covers all crimes, which means it could ostensibly apply to cases of IP infringement, meaning people may literally lose their hands for counterfeiting.

Salem in Kuwait, whose office was moved from Cairo, highlighted various issues for the Gulf Cooperation Council (GCC) countries. In the United Arab Emirates (UAE), she cited a commercial fraud law and said that according to brand owners, there is a customs practice in Dubai of re-exporting counterfeit goods. There also is a lack of copyright collecting societies in the country. And the country’s ministry of health has come to them with concern about counterfeit medicines, she said.

Kuwait is not happy about being elevated this year to the US Trade Representative Special 301 priority watch list, said Salem, but they have begun to comply with one area of concern – implementation of the WTO-compliant copyright law, which they have now drafted. Another area of concern there has been a lack of enforcement.

With Saudi Arabia, software legalisation continues to be of concern. But the country is looking for ways to diversify away from oil dependence and toward a knowledge economy, and is working on patenting innovations, she said.

For the GCC countries is a new trademark harmonising law, but there is no central registration office, so there won’t be a GCC-wide trademark office, Salem said.

In Egypt, enforcement issues remain problematic, she said, and there is a high turnover of judges, and they are also working on patent linkage issues. In Morocco, software legalisation especially in the public sector is problematic, she added, and there are customs issues as well.

Asked what IP-related developments resonate with the governments they work with, Lewis said the Mexican government seeks to emulate the US innovative economy, but the entrepreneurial spirit cannot come from the top down. Fowler said in his region, when the fashion and film industries are vocal it tends to get attention.

Obstacles to IP Enforcement

The Geneva attachés were asked about e-commerce companies and discussions in Geneva about supply chains, and Schlegelmilch said those issues are “unfortunately” not discussed much at the UN. She said it might make a good topic for the WIPO Advisory Committee on Enforcement, the non-negotiating body which meets about every year-and-a-half, and which she said is “enforcement soft”.

Ferriter said it did come up at the WTO a while ago, and also was brought up in the context of the innovation discussions at the TRIPS Council, looking at the supply chain apart from pharmaceutical products. She further said they do have conversations at WTO with the e-commerce companies.

Neil Turkewitz of the Recording Industry Association of America (RIAA) said from the audience that they all hear from him but he wanted to ask what they see as the biggest obstacles.

Ferriter said it is misinformation, or a lack of information. An example she gave of what needs to be communicated is that copyright is not a barrier to access to information.

“Let’s talk about what the real barriers are, let’s talk about how intellectual property is a facilitator,” said Ferriter. “The more you can bring in the facts on the ground, the more that we can push back against the misunderstandings” that come up.

Salem said in general it is important that industry itself work to address their own concerns directly with other governments.

Fowler said the importance of the creative industries to economies should be repeatedly emphasised to governments.

Kilbride intervened to say the Chamber in its advocacy hears from governments that they see themselves as net importers of IP and that it is a self-fulfilling prophecy that they will then implement policies making them net importers.

In answer to a question, Schlegelmilch said there is difference between “what we hear in Geneva versus what we know their own IP offices are saying, what their ministries of trade are saying, for example in our bilateral discussions, even when some of us are sitting in a meeting room in the General Assembly and there are bilateral meetings going on in the room down the hall between USPTO and that counterpart IP office, there are different messages being delivered. It creates a great challenge. It’s probably … one of our greatest obstacles, the lack of consistency for many member states at WIPO.”

Ferriter said “we keep working at it.” She said there was a recent situation where they sent demarches to their IP attachés around the world and to State Department officials to communicate a certain message to the government. “We had very important meeting about it about a month later, and a couple of weeks after that our IP attaché counterpart came to us and said, oh I just heard about this,” she observed. “So with time I think there will perhaps be more consistency between the other governments’ Geneva attaché and their capital. I’m always an optimist, and we just decided we need to do more advance work and perhaps at that point we’ll have a more consistent message.”

Asked about patent harmonisation, Lewis said Mexico is working to increase its work-sharing and has been taking many steps toward that such as having a Patent Prosecution Highway agreement.

China, Russia, India, Brazil

Joel Blank, the attaché for Beijing, said main priorities for the mission include trade secrets, both misappropriation but also protecting confidential information, particularly in licensing. China is taking some steps on this, convening an interagency expert panel to look at it, he said, but it’s taking time. The People’s Congress anticipates amending the trade secrets policy in the next 2-5 years, but the government may not be in line.

The second issue Blank mentioned was China’s use of legal and policy tools to reach its goals, such as its subsidy programme with certain criteria, or the use of the anti-monopoly law for what may be standard business practice around the world. It appears this is happening in order to obtain the intellectual property of the companies at beneficial rates, he said.

A third priority is enforcement, as China has adopted some good laws but needs to focus on the enforcement end. He went into specifics of how laws are changing in the country. He also discussed the new IP courts that China has been opening. Also, the US has a new ambassador who recognises the importance of IP to the US economy, and who wants more information, he said. Blank invited success stories in particular.

Browning, in Guangzhou, said a lot of the country’s innovation is happening in that South China region. But the region is also the location of more infringement than other parts of the country, including trade secret misappropriation. Many of the US Trade Representative’s “notorious” markets in China are located in that region.

He discussed a case outcome in which there was a conviction and a fine but it does not appear now that it will ever be paid. And he mentioned the region’s concentration of counterfeit goods producers. In addition, he highlighted the extraordinary scale of the problem in the country. But he pointed to some successes as well.

Michael Mangelson talked about Shanghai, and other parts of his region, which includes Taiwan. Shanghai has the largest concentration of foreign companies and technology industry, he said. Shanghai has opened a free trade zone that has an IP bureau which handles all types of IP – a one-stop shop, he said.

Discussing problems in the region, he mentioned “prejudicial patent examination” related to biotechnology that is seen as protecting the local market. Another concern is a “service invention regulation” that is soon to be adopted. This will mandate compensation for employees who are involved in the innovation process for technologies. Many US companies already have incentive programmes and perceive this regulation to be undermining their ability to make their own arrangements. And he mentioned technology licensing issues and technology transfer concerns.

Mangelson also mentioned online piracy, and noted that Alibaba, the largest e-commerce company in the world, is situated in his district. The office is working to hold an IPR protection programme this spring, hopefully coinciding with one of USPTO Director Michelle Lee’s two upcoming visits to China, he said.

Reddy, in India, gave a positive note as there have been several meetings and discussions recently. She mentioned the high-level working group the two countries have agreed to hold. She noted that trade secrets will be joining the other more traditional issues to be discussed bilaterally. “We do think the attitude on the ground has changed with the Modi government,” she said.

She said the IP think tank the government set up seems to have a short timeline, with the first draft of their report due as soon as late January. Like China, she said there are laws for many issues but that enforcement is not sufficient.

For Brazil, Keyack said there is a shortage of engineering talent so it’s tough to retain patent examiners, and there is a very large backlog for patents and trademarks. University licensing remains very difficult to do in Brazil, he said, so his office is working with them to help show how the Bayh-Dole Act has helped in the United States. In general, he indicated that Brazil may be poised for some change.

Townsend in Russia said relations have been difficult for broader political reasons. The current situation has led to a bilateral IP working group suspending all activity, cancelling a meeting this year.

In his region, many pirate websites have been moving into Ukraine to take advantage of the unstable situation. Meanwhile, a new copyright anti-piracy law has been adopted that will take effect in May. But the IPR enforcement environment remains very weak, and no significant actions have been taken against pirate websites, or those offering counterfeit goods. All of the sites continue to operate unhindered, he said.

Townsend’s region also includes Kazakhstan, which, bordering China, is a conduit for transiting of counterfeit goods. But the country has been cooperative in addressing the issue. He concluded by saying that things are looking up for IP rights in Russia.

Elevate the Rank?

Finally, Blank, Keyack, Townsend and others mentioned that because of their relatively low rank within the embassies, they often have to find ways around issues, such as not being able to call on more senior officials directly. It can take months just to have an introductory meeting. They are first secretaries in the mission, trying to work with officials who are much more highly ranked, they said.

 

Image Credits: Patrick Kilbride, US Chamber GIPC