By Murray Hiebert & Noelan Arbis

 

The Office of the United States Trade Representative (USTR) will publish its annual review of intellectual property rights (IPR) protection problems around the world, called the “Special 301” Report, sometime around May. When it does, USTR should seriously consider graduating the Philippines from its IPR “watch list.” Manila has taken actions in recent years to build a legal IPR infrastructure and crack down on piracy and counterfeiting.

USTR publishes the “Special 301” Report at the request of Congress to evaluate the performance of about 40 U.S. trading partners in protecting and enforcing IPR. Countries considered not to be providing effective protection are categorized as “Priority Foreign Countries” (the 2013 report included only Ecuador), “Priority Watch List” (10 countries were listed last year, including Indonesia and Thailand in Southeast Asia), or “Watch List” (30 countries were included last year, including the Philippines and Vietnam).

The Philippines was promoted in 2006 from the Priority Watch List to the Watch List after a USTR out-of-cycle review showed that the country had made substantial progress in launching crackdowns against the production and selling of pirated optical discs. Since then, the Philippines has continued to take steps to bolster IPR by passing laws to improve and streamline enforcement.

In 2010, the country’s Intellectual Property Office (IPOPHL) established an Operations Center to spearhead and coordinate policing operations by various law enforcement authorities. It has also stepped up raids on notorious markets selling counterfeit products such as Quaipo in Metro Manila.

In its 2013 report, USTR lauded the Philippines for passing long-awaited legislation to implement the World Intellectual Property Organization’s Internet treaties and to provide customs officials authority to investigate IPR violations. But the U.S. government also called on Manila to do more to tackle piracy over the Internet, in particular in well-known online markets, and strengthen IPR enforcement efforts.

Last year, the Philippine Congress passed a bill that established a Bureau of Copyright within the IPOPHL to codify instances of copyright infringement as well as clarify copyright laws. IPOPHL deputy director-general Allan Gepty says that Philippine law enforcement officials  have conducted around 2,500-3,000 raids and have spent about $900 million to further enforce IPR since the country was elevated to the Watch List.

The Philippine Department of Justice in cooperation with the National Committee on Intellectual Property Rights in 2012 crafted a “Manual on Law Enforcement and Prosecution of Intellectual Property Rights” to serve as the standard procedural guidelines for law enforcers and prosecutors handling cases of IPR violation.

The country is also increasing education and advocacy efforts to support IPR. The IPOPHL in 2013 launched an IPR Youth Camp to get Filipino youths more involved in IPR promotion, protection, and enforcement. The youth camp is envisioned as an initial step to involve the country’s schools in IPR advocacy.

Gepty says one of the major challenges facing the Philippines is that most violators of IPR, such as vendors of pirated products, come from lower-income backgrounds. They will need job training before being reintegrated into the workforce. This is a key challenge for the country, which despite experiencing robust economic growth in recent years, continues to suffer from high unemployment.

Despite the introduction of IPR courts and the training of judges, the number of cases brought against violators of IPR remains quite small. There have been a total of 1,027 IPR cases filed before the Special Commercial Courts (established in 2003), but the IPOPHL only recorded six IPR convictions from 2011 to 2013. Stakeholders affected by IPR infringements are reluctant to bring cases, apparently out of fear of economic or political retaliation. Even most cases reported are ultimately settled out of court.

Protecting intellectual property is increasingly crucial for Southeast Asian moviemakers, musicians, fashion designers, manufacturers, and others that need to have their IPR upheld as the region develops and becomes integrated into the regional and global economy. In recognition of this, Southeast Asian countries in April 2013 launched the ASEAN Intellectual Property Portal, which contains information on the IPR systems in each of the countries and web links to their individual IPR offices.

It is important that the United States recognize the progress the Philippines has made by graduating the country from the Watch List when it publishes the 2014 “Special 301” Report. Doing so would not only reward Manila for what it has already done and encourage additional steps going forward, but it would also provide an incentive to other countries in Southeast Asia trying to implement similar reforms.

Mr. Murray Hiebert is a senior fellow and deputy director of the Sumitro Chair for Southeast Asia Studies at CSIS. Follow him on twitter @MurrayHiebert1. Mr. Noelan Arbis is a researcher with the Sumitro Chair.