Country Focus: Meeting IP Challenges in Lebanon

The Intellectual Property Protection Office of the Ministry of Economy and Trade in Lebanon has developed rapidly and faced many challenges in the last few years. Today, however, it may be facing its greatest challenge as it tackles Lebanon’s counterfeiting and piracy problem. At the beginning of summer, Fadi Makki, Director General of the Ministry, announced a new crackdown on piracy, both by increasing raids and through education and incentive programs to increase understanding of intellectual property (IP) rights.

The road behind

Lebanon was one the first countries in the Arab region to pass legislation to protect IP, and has been a member of various international IP conventions since the 1920s. So when new international and regional agreements necessitated a revision of IP laws and infrastructure for many countries, Lebanon did not hesitate. Over the last decade, Lebanon has updated IP laws and enforcement mechanisms, a continuous effort that has required much reorganization and training of personnel.

For example, Lebanon enacted new laws on the protection of copyright in 1999 and on patents in 2000. The government is currently putting the final touch to a new law on trademarks and geographical indications, and is developing legislation on distinctive signs, designs and unfair competition. The Ministry of Economy and Trade faced a number of difficulties in implementing the new laws because of gaps in the institutional infrastructure. Some of the problems included:

• outdated IT equipment and network links between offices;
• a lack of specialized staff and judges in the courts;
• limited technical capacity and available human resources for enforcement;
• limited means to promote public awareness of new laws.

Assistance from WIPO and other organizations, including the private sector, have helped them to overcome some of these problems. The Ministry has now computerized its offices, and launched an online trademark database this summer. Staff have been trained to carry out the full range of trademark registration processes. An outreach program was launched in schools. Enforcement raids are now coordinated between the IP Protection Office, customs and the judiciary.

But an increase in counterfeiting in 2004 raised the bar.

Facing the challenge

Lebanon already had one of the highest rates of counterfeiting and piracy in the world. A report by PricewaterhouseCoopers in 2003 estimated that losses for the Lebanese government resulting from counterfeit products ranged from US$75 to 100 million per year. In a recent report, the Business Software Alliance (BSA) estimated that losses related to software piracy in the country amounted to US$26 million in 2004 – an increase of over 18 percent on the previous year’s figures.

In the last year and a half, Lebanese authorities carried out hundreds of raids, seized counterfeit goods worth tens of millions of dollars and increased corresponding fines. But still piracy increased. The Director General of the Ministry of Economy and Trade explains, “the main problem is that people tend not to associate IP infringement with stealing or other immoral acts.” So on August 1, 2005, the Ministry launched a major media campaign, aimed at spreading understanding and respect for IP rights among consumers, students and businesses. “There can be no better deterrent for counterfeiters than an unwilling consumer,” said the Director General.

The campaign addresses IP protection of local cultural industries, especially in areas where Lebanon is strong, such as music, software, advertising and fashion design. It aims to show consumers that they are all stakeholders, and that as such it is in their interest to help build an IP culture in Lebanon. The campaign will use video clips, posters and information leaflets, as well as training seminars and workshops to educate officials, consumers and businessmen. Events are planned in Bekaa, Beirut, Saida and Tripoli.

The Ministry is backing its educational program with incentives to encourage business to use legal software. It is tightening enforcement measures against pirated software on one hand, and on the other is negotiating with computer companies to reduce the costs of legal software for small and medium-sized businesses.

The Ministry also set up a consumer hotline to respond to questions and complaints. Mr. Makki said, “We are encouraging intellectual property holders to complain to us. We have received lists of music shops that sell pirated CDs and are already taking action."

The Ministry has joined forces with other government agencies and with the private sector to reach out to the broadest possible public. Microsoft is working with the Ministry to provide Internet cafés with software worth US$20,000 for an annual subscription fee of US$295 per café. The Director General believes the initiative will reach some 1,500 Internet cafés, and cut Lebanon’s current piracy rate by 15 percent.

The initiative will create a partnership with local Internet cafés in order to promote an educational, safe and secure Internet experience. By transferring skills and technology to the cafés’ owners and users, it aims to increase awareness of the value of licensed software.

The Lebanese authorities are also multiplying raids, and increasing fines on counterfeit goods to deter counterfeiters. In the first ten days of August, over 3,300 counterfeit items were seized and then publicly destroyed. The shock this caused in the market should make pirates think again, as they face jail sentences and fines of up to US $50,000.

Moving forward

Transforming public perceptions is never an easy task. However, Lebanon can draw encouragement from the experience of the United Arab Emirates (UAE). The UAE is the only emerging economy which figures in the BSA’s list of countries with the lowest incidence of software piracy. The BSA attributes UAE’s success to “deliberate attempts to adopt stronger intellectual property protections during the 1990s, when a new generation of policymakers came into power and began luring foreign investments.”

Policymakers in Lebanon are clear that IP protection is not only about respecting international agreements, but is fundamental to fostering Lebanese enterprise and creativity, to attracting foreign investment and to protecting the country’s consumers. The Ministry of Economy and Trade is therefore moving forward with determination.