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Cablegate: Ipo and Ntc Ink Rules for Coordinating Cable Piracy Cases

VZCZCXRO2906
OO RUEHCHI RUEHDT RUEHHM
DE RUEHML #1393/01 1220841
ZNR UUUUU ZZH
O 020841Z MAY 07
FM AMEMBASSY MANILA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 6330
INFO RUEHZS/ASEAN COLLECTIVE IMMEDIATE
RUCPDOC/USDOC WASHDC IMMEDIATE

UNCLAS SECTION 01 OF 02 MANILA 001393

SIPDIS

SIPDIS
SENSITIVE

STATE FOR EAP/MTS
STATE PASS TO USTR FOR BWEISEL AND DKATZ
USDOC FOR 4430/ITA/MAC/SBERLINGUETTE
USDOC PASS USPTO FOR PFOWLER
BANGKOK FOR CHRIS SONDERBY AND JENNIFER NESS

E.O. 12958: N/A
TAGS: ECON ETRD KIPR BEXP RP
SUBJECT: IPO and NTC Ink Rules for Coordinating Cable Piracy Cases

Sensitive but Unclassified - Not for Internet Distribution

REF: 06 MANILA 2167

1. (SBU) Summary. A potentially significant step in combating
cable piracy in the Philippines took place on April 4, when the
Intellectual Property Office (IPO) and the National
Telecommunications Commission (NTC) released the implementing rules
and regulations for a memorandum of agreement (MOA) on cooperation
in enforcement of laws against cable piracy. Representatives of the
pay television industry have expressed optimism about the new
arrangement, which both industry and the Embassy had lobbied for.
End summary.

A Mechanism for Combating Cable Piracy
-----------------------------

2. (SBU) According to the regional trade association, the Cable and
Satellite Broadcasting Association of Asia (CASBAA), cable piracy in
the Philippines costs the legitimate pay television industry about
$80 million per year. CASBAA has criticized the National
Telecommunications Commission for not blocking the license renewals
of pirating companies and scored the Department of Justice for not
moving on international channels' legal cases against copyright
violators. John Medeiros, executive director of CASBAA, told
EconCouns that many cable companies in the rural Philippines openly
steal signals but that the GRP has taken little action against the
practice. He argued that acceptability of cable piracy has reached
the point that the owner of Maguindano Skycable in Cotabato City has
made public statements openly encouraging cable operators to take
the signals of international channels without paying.

3. (SBU) Much of the difficulty in investigating and prosecuting
cable piracy arises from the lack of clear jurisdiction over
infractions. The IPO has the jurisdiction to administer the
Intellectual Property Code, which includes copyright protection.
The NTC, however, is responsible for the granting of licenses to,
and oversight of, radio and television broadcasting, which extends
to cable television and direct broadcast satellite services. The
NTC has never had a clear mandate to address intellectual property
issues, and has not revoked the licenses of cable or satellite
distributors for piracy.

4. (SBU) The regulations released on April 4 implement a June 2006
memorandum of agreement under which the IPO would investigate
allegations of IP violations and the NTC would use its regulatory
powers to deny licenses to offending firms.

Regulations: Most Important Points
-----------------------------

5. (U) Below are the highlights of the new regulations:

--Complaints of violation of laws involving intellectual property
rights against any radio or television broadcast operators, to
include cable television operators and direct broadcast satellite
service operators, will be filed directly with the IPO.

--The NTC will have the authority to refer cases of cable piracy
that it discovers to the IPO. It will also advise IPR holders,
giving complainants the option of pursuing the case before the IPO
or with the regular courts. If the complainant decides to pursue
the case with the IPO, the NTC will refer the records of the case to
the IPO. Once filed with the IPO Bureau of Legal Affairs, the IPO
will notify NTC of such filing and IPO will proceed to "resolve the
complaint in accordance with its rules and regulations."

--IPO will provide NTC with copies of orders, resolutions, or
decisions regarding cases that have been referred by the NTC
involving IPR violations. Based on these orders, the NTC may either
issue a directive to the party concerned to comply with the order of
the IPO or issue an order to show cause within 10 days why its
license or authority should not be suspended. The NTC will then
evaluate whether or not to grant or renew a license. Should the IPO
issue a cease and desist order in a pending case involving an
applicant, the NTC may not issue or renew the permit, license or
authority of the applicant, unless there is sufficient showing that
the order has been complied with or has been lifted.

--The NTC is responsible for monitoring the compliance of radio and
television broadcast operators, including cable television operators
and direct broadcast satellite service operators, in relation to
laws and regulations on IPR. The assistance of local government
units and the private sector can also be sought to monitor and

MANILA 00001393 002 OF 002


enforce the compliance of the operators. The NTC can be deputized
by the IPO to help in implementing IPO orders and decisions.

--Both the NTC and IPO agree to continue cooperation in the
promotion and protection of IPR through the exchange of information
and conduct of workshops and trainings among their personnel to
enhance capability in resolving issues involving telecommunications,
broadcasting, cable piracy, and intellectual property.

Industry Guardedly Optimistic
-----------------------------

6. (SBU) Medeiros of CASBAA told EconOff that the issuance of the
regulations represents a significant step forward. In particular,
he was pleased to see several points that industry representatives
had made at public hearings on draft regulations incorporated into
the final version. The industry is anxious to put the new
procedures to the test by filing cases.

Comment
-------

7. (SBU) The issuance of the regulations is a welcome development
for content providers. Implementation, however, is likely to be a
challenge. Post will continue to follow the issue, and will provide
updates via Intellipedia. End comment.

Kenney

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