How Difficult to be Legal Fighting piracy requires new evidence
For three years the International Intellectual Property Alliance has labeled Ukraine one of the world’s piracy leaders. The current report is special in that it views the problem from a different perspective: while earlier we were accused of the mass production of bootleg goods, now Ukraine is being blacklisted as the main transit corridor for Russian and Belarusian CDs to Europe. Moreover, international experts are convinced that a portion of the contraband stays “fraternally” behind in Ukraine. Ukraine is also indirectly guilty for... combating piracy: tough measures have forced some underground factories to relocate to Russia, which has significantly boosted the number of CDs produced there.
Ukrainian experts view such conclusions of the international community as far from indisputable. However, according to Oleksandr Krasulia, deputy chair of the Ministry of the Economy Department for Trade Restrictions and Control of Foreign Economic Relations, we must correct the situation instead of pointing the finger at other countries, where intellectual property rights are violated on an even greater scale. Moreover, after opting for European integration, we must accept the rules of the game offered. In the opinion of Maksym Koval, deputy director of the Ukrainian Intellectual Property Union, failure to meet international standards on intellectual property could be one of the factors hindering Ukraine’s WTO accession. It is also important that, while this problem is still on the agenda, Ukraine continues to incur considerable losses — now $50 million — due to US economic sanctions. Simultaneously, the FATF story shows that close cooperation between the cabinet and parliament could lead to the punitive sanctions being lifted from Ukraine in a short time, Mr. Krasulia noted. The Economy Ministry has already drawn up a number of amendments to the law On the Special Features of State Control over Economic Entities Engaged in the Production, Export, and Import of Laser Discs, the take US embassy proposals into account.
Meanwhile, repercussions of the struggle for the observance of international norms in the field of intellectual property have at last reached the Ukrainian compact-disc market, which for the first time ever is now offering licensed products. However, this segment of the market so far accounts for a mere 10%, estimates IT-Consulting manager Oleksandr Bernatovych. Only a few facilities fitted with obsolescent foreign equipment are engaged in this business, so it is too early to speak seriously about any emerging hi-tech industry. Licensed discs find it difficult to compete with pirates owing to their high cost and the low purchasing power of the population. So the bulk of the CDs sold in Ukraine are, as before, bootleg items primarily of Russian origin.
Last year Ukraine established a CD import licensing procedure which calls for a one-time license. As often happens, the concept was good, but in practice it only complicated the life of those who decided to work legally. At the same time, smuggling in the latest licensed software products flourishes in Ukraine via the large distribution networks that freely bring in and sell licensed discs, bypassing all customs rules and procedures, Mr. Bernatovych says. What could effectively encourage Ukrainian companies to obey the law is the Roster of Software Producers and Suppliers to be set up by a Cabinet decision: Mr. Bernatovych thinks that the enterprises put on this roster should be exempt from software licensing requirements. According to Mr. Bernatovych, the main difficulty is that most software products, deemed legal, are not so in reality because it is often impossible to trace their route from the copyright holder to the end user.
