AmCham leads the way to promote IPR in Sri Lanka

By Charumini de Silva

The American Chamber of Commerce (AmCham) in Sri Lanka has taken a key role in Intellectual Property Rights (IPR) activities since 2007. The Chamber has been in the forefront to facilitate awareness and enforce the existing IPR laws in Sri Lanka and is involved in carrying out island-wide public awareness and initiatives.

AmCham IPR Committee and Initiatives Secretary Sanjaya Fernando took time off to speak to Daily FT on the importance of IPR and why awareness is needed and said that with Sri Lanka aiming to be a fast developing open economy, it is important to have a stringent intellectual property rights regime to encourage investments as well as to convince genuine manufactures that their rights are respected and protected.

Below are excerpts of the interview:

Q: Importance of having intellectual property rights?

A: At the national level, two of the principal challenges in combating counterfeiting and piracy needs to be addressed. Firstly find ways to enhance enforcement and secondly to raise awareness of counterfeiting and piracy issues. More may need to be done to undermine counterfeiting and piracy at the point where infringement originates; once goods enter domestic or international trade, the task becomes more difficult. In a nutshell having IPR creates a safe and development oriented environment for innovation as well as further paving the way for original creations to flourish. 

However, in Sri Lanka the awareness and the respect we have on the rights of the inventors, developers, brand owners and as well as for the end users are very minimal. In terms of the users, we pay the least amount of respect to them by not taking note of the harmful impact we are making. It is time that Sri Lanka steps up and focuses on the IPR area before some international players intervene and say that we are not respecting human values and hence they do not like doing business with our country. This is what we have been facing right throughout. 

Thus; it is time that we initiate steps and intensify our laws and regulations before international bodies intervene with regard to IPR violations. AmCham has been promoting new initiatives through the engagement of the National Intellectual Property Office (NIPO), but we notice that people are reluctant to be progressive in relation to making new inventions in Sri Lanka for the simple fact that there is not enough recognition on the individual’s effort as well as for the insecurity of one’s own work being copied and put it to the market within no time. This has suppressed the innovative capabilities of our youth as opposed to other countries. On a personal note, I know many Sri Lankans in other countries who are inventing software and various other gadgets for international brands on a monthly basis. Hence, the reason that they leave Sri Lanka is because the environment and the security are not there for them.

Q: What are the laws available to address the issue of violations of intellectual property rights in Sri Lanka? 

A: The primary legislation in place is the Intellectual Property Act No. 36 of 2003, which is in line with the global Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement.

Q: How important is it to have effective implementation of the existing Act?

A: The present Intellectual Property Act No. 36 of 2003 is TRIPS compliant and intends to promote and protect national creativity and to also honour international obligations. The Act has separate parts specifically for the protections of copyrights, industrial designs, patents and trademarks.

Q: The Government has declared that Intellectual Property Law in Sri Lanka inclusive of Copyright Law will be revived and implemented stringently. What are your thoughts on it?

A: Stringent implementation is necessary for the protection of intellectual property rights and to create a stable environment that safeguards the intellectual property rights of right holders. Further, advancing of intellectual property rights in Sri Lanka would be possible only with the concerted efforts and support of Government institutions, industry leaders and trade associations. It will not only give confidence to international players, but also to the local private sector to invest on research and development activities when they have assurance that their cost can be covered by selling genuine products to the consumers. 

Moreover, the Government fails to collect a considerable amount of income annually due to counterfeit and fake items being brought in and sold in the market. In order to address all these issues, the Government must have strong measures to intervene on counterfeits at the entry points as well as at the end consumer level. Hence, there is a need for continuous implementation and enforcement to protect and promote intellectual property rights to drive Sri Lanka to its fullest potential to bring about the growth that is anticipated. 

Mostly what we should demonstrate is that our country is a favourable location for sectors such as tourism and apparel. Asia is one of the hubs that provide branded clothes in a highly competitive market and it is one of Sri Lanka’s largest income generating avenues. The trends in the apparel market evolve rapidly; players have to be the first in the market to be ahead of competition and consequently brand protection is a necessity. International brands will engage applicants based on quality assurance and security. 

Hence, having a strong shield is essential to deliver the finished products safe and sound directly to the brand owner’s departmental stores. Only then will Sri Lanka have the edge over leading countries, such as Vietnam, Bangladesh and India, in the global market. In addition, we have to focus on tourism, as it has been recognised as one of the foremost sectors of our economy. When foreigners visit to Sri Lanka, they must be provided the assurance that commodities available are fit for consumption and are of genuine quality. 

That’s where the Sri Lanka Customs would also come into play. The products that flow to the end users should be channelled through genuine markets, especially tobacco, alcohol, pharmaceuticals and other food products. The most common product categories in which counterfeits are available in the market are pharmaceuticals, cosmetics, automobile accessories, electronic items, software, garments, watches, handbags, tobacco and building materials. 

By producing counterfeit products these fraudulent manufactures/ importers violate the rights of genuine manufactures who take great effort to bring innovations to the market. I think that even though the Government has regulations in place, implementation itself is questionable. This is the very reason why we need to engage the relevant Government authorities to conduct raids and investigate into the embellishments that are being imported for manufacturing purposes. 

It is very important to educate the necessary Government agencies on how to detect, investigate and conduct raids on these products. This can be achieved through collaboration between the registered agents and the Law Enforcement Agencies (LEAs). Developed nations are what they are today as they have recognised the importance of IPR of their citizens. Having regulations in place will protect local talent and also prevent brain drain which is taking place at a tremendous pace in this country. Although the Government has taken several initiatives, the implementation is very sluggish. These delays will not help us achieve the objective, which is protecting the IPR.

Q: What kind of a mechanism should we look at to implement these laws in a more practical way?

A: I think the brand owners have a huge role to play in this scenario. It is of no use to lay blame on the Consumer Affairs Authority (CAA), Sri Lanka Customs or any other law enforcement institution. The brand owners of these multinational companies have a greater role to play, where they will have to collectively, or individually, support the law enforcement agencies by providing the correct picture of the impacts of illicit or counterfeit products that are flowing into the country. 

The brand owners should not be afraid to accept that their market segment is impacted due to counterfeit and illicit products, and should sincerely assist the authorities by providing the necessary information with regard to the authentic product in order to establish the differences with the counterfeit product with the primary objective of hunting down the offenders. Many of these multinational companies have international laboratories where they could provide reports confirming the products to be counterfeit. 

These reports will generally be accepted by courts as they have the accreditation from international universities that have the license to issue such certificates. Therefore, they need to look at the broader picture. Unfortunately, most of these multinational and international companies only see the short-term gains in the market and overlook the benefits they gain in the longer run. Most companies are reluctant from going into detailed investigations thinking that it would have a pessimistic impact on their brand image. 

However, they must also consider the long-term confidence they would establish in the minds of their customers by accepting and trying to support the eradication of counterfeit and illicit products from the market. AmCham has conducted several educational programs for Government agents in the recent past. During these sessions, we were informed by those officials that it was very difficult for them to prove that the products in question are counterfeit as most brand owners do not offer support. 

Therefore, it is high time that the brand owners step forward and help prove the validity of their genuine products in order to eradicate this menace of counterfeit and illicit products from the system. The brand owners should take charge of the situation. In Sri Lanka I don’t think many of the companies, with the exception of one or two, do research work to quantify the impact of counterfeits on their business. Nevertheless, it is imperative that these much acclaimed ethical companies not look at the short-term gains, but at the long-term values and gains they make to the community. 

For the first time, AmCham is sponsoring three research projects this year in collaboration with the CAA with the help of University of Sri Jayewardenepura The research study is based on three selected areas of Brand Protection, where AmCham is providing financial assistance to conduct the research work. According to the available sources, there is no evidence to say that Sri Lanka has done comprehensive research on the areas of intellectual property rights, consumer attitudes on counterfeiting and piracy, ways of counterfeits and fakes entering into the Sri Lankan market and their implications. 

The law enforcement agencies such as the CAA and the Customs Department need quantitative data as well as qualitative information when developing their interventions and strategies to cope with the increasing issue of counterfeits and fakes. In order to develop action plans to fight against counterfeits, there must be necessary background information which is currently lacking in Sri Lanka. To develop awareness campaigns for consumers it is imperative to know the prevailing consumer attitudes on counterfeiting and piracy and also the consumers reasons for purchasing these particular items. 

In this backdrop, we found that it is of paramount importance to conduct a research in this field of study and to collect information on the types of counterfeits available in the market, knowledge of the right holders to initiate actions, counterfeit seizers made by the Customs Department, origin of counterfeits, places where the counterfeits are available, types of court cases and penalties imposed, and to understand the involved parties/ groups including their modus operands and so forth. 

Q: How would you justify the importance of introducing a national policy for innovations in Sri Lanka?

A: The Inventors Committee as well as the National Intellectual Property Office (NIPO) is working closely on this matter. Even though AmCham is not directly involved in it, we are facilitating platforms to air the voices of the Committee and the NIPO to the general public through seminars and workshops. In this background, I think the private sector should come forward with viable proposals where they could assist new inventors and promote innovations in the country. There needs to be change in the mindsets and a positive approach towards new innovations. 

Most inventors think why should I develop something for a particular company while they make big bucks out of it? This attitude transformation must come through the education curriculum, and that’s one of the reasons why we proposed to the CAA to launch a program to do an essay and poster campaign for schools. Educating school children is one of the areas that we wanted to drive. In addition, when many institutions are involved in these investigations it would be difficult for the racketeers or the mafias to dodge the net of security, as there are many layers they would have to obtain clearance from. 

Q: Sri Lanka aims at entering into multiple trade agreements with different countries; how important is it to have adequate intellectual property rights protections included in them? What major sectors should be covered?

A: Having intellectual property rights protected would create avenues for economic growth, increase investments, attract potential investors, generate revenue and  acquire global recognition for  protection of intellectual property rights. For any country to sign an agreement with another country, again, I believe that both of these countries have to abide by many checks and balances. As such, the agreement should cover all aspects of IPR protection, from raw materials to the entire process as it is not just one party involved.

Q: What measures have been taken by the public and private sector to educate the general public on intellectual property rights in Sri Lanka?

A: The direction to AmCham was given by the United States Patent and Trademark Office (USPTO). They have an office in Sri Lanka and until 2013 we obtained great support from them. We had some of the senior Attorney General Representative Councils coming from the US to conduct programs in Sri Lanka for Magistrates and Judges. This year also we have included this training program for Judges in our agenda and awaiting approval from them. As AmCham members are limited, this year we thought of working with the Ceylon Chamber of Commerce (CCC) as they have a wider group and it would be opportune to have them on board to conduct more knowledge sharing programs among the private sector. 

As a country we need to be more progressive and a huge contribution in this regard is required from the private sector. On the other hand, there is a tendency that the public is slowly moving into genuine branded products depending on their purchasing power. This is mostly apparent in the Colombo and suburbs due to the knowledge and education of the youth, but we need to drive it further to the outskirts in order to share this knowledge. This is where we need the support of the private sector as well as professional associations to enhance the knowledge of the communities living in rural areas regarding the downside of using substandard products in the long run. 

Q: What can you say about the skills of the Government officials conducting raids?

A: Mostly the identification of genuine products from counterfeit products is an issue for them and that’s where the brand owners should come in to support. So far the CAA is conducting very primary level raids on goods, but there are many other things they could go after and also generate revenue for the Government if the proper training and awareness is provided. Lack of practical knowledge on the identification of products and the adverse impacts of the use of counterfeit goods is a huge concern. 

If the brand owners come forward to support this initiative it could make a huge impact to the society. This is a mafia – the money people make out of sale of counterfeit is unaccountable and the global phenomena  is such that these funds are used for various illegal activities such as gun culture, prostitution, human trafficking which many of us in the society do not know.  The worst is that it could be your loved ones who could fall prey into the hands of these criminals.

Q: What are the capacity building programs that AmCham has? For what organisations?

A: We are conducting many programs for the Government agencies as well as for the private sector. This year we have lined up many programs for many law enforcement agencies such as the Sri Lanka Police, Criminal Investigation Department Anti-Piracy Unit, Customs Department, Consumer Affairs Authority (CAA), National Medicines Regulatory Authority, and Public Health Inspector’s Union, Information and Communication Technology Agency (ICTA) and the media. Last year, we initiated a training program for 180 CAA employees of which 120 have been trained, while the next batch is due to be trained in the coming months. In line with this year’s World Consumer Protection Day, we will shortly commence an essay and poster campaign for school children.