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Vietnam's WTO Membership Threatens Pirate Paradise


When Vietnam joins the World Trade Organization at the end of December, one group of businessmen will not be happy: those who make a living from stolen intellectual property. Intellectual property rights are rarely enforced in Vietnam, allowing stores selling pirated DVDs and software to flourish. But that may be about to change, as Vietnam has pledged to observe international intellectual property agreements after joining the WTO.

The streets of Hanoi's Old Quarter are paved with gold for those looking to buy cheap music and videos. Shops selling illegally copied CDs, DVDs and software are everywhere. Everything from the latest U2 album to the "World of Warcraft" game to the first season of the television show "Battlestar Galactica" can be had for one and a half dollars per disk, or less.

But that may be changing. Vietnam joins the World Trade Organization in late December, and it must immediately begin observing the so-called TRIPS agreement, or Trade-Related Aspects of Intellectual Property. The agreement obliges members to respect international copyright and trademark rules.

That could mean hard times for Hanoi's intellectual pirates. One CD and DVD shop owner says entering the WTO is good for Vietnam, but not necessarily for his business. The shop owner says that because of the copyright issue, his business might suffer next year.

Technically, Vietnam's agreement to join TRIPS does not change very much. Vietnam has been obliged to protect American intellectual property as part of its bilateral trade agreement since 2004. And the country's new, stricter intellectual property law came into force in July.

But while Vietnam's laws satisfy TRIPS requirements, enforcement has been lax. Tom Treutler is an intellectual property lawyer who represents large foreign businesses in Vietnam.

"Under TRIPS, you need to have criminal penalties that can be applied and that have a deterrent effect," he said. "And so far the government hasn't applied criminal penalties in I.P. cases in many instances."

Treutler says that when police do catch offenders, they often let them off with minor fines. He says TRIPS and the new law might help change that.

"The laws actually are quite good as they are now," he added. "The enforcement just needs to be a bit stricter."

Some intellectual property experts think that Vietnam will not begin strongly enforcing the law until more Vietnamese musicians, movie producers and software makers have a stake in copyright protection. For now, copyright rules are mainly a cost to Vietnamese businesses.

Minh Hoang is the assistant to the head of garment maker MHG. The company's computers used to run pirated Microsoft software - as over 90 percent of Vietnamese computers do, according to software industry research. With WTO accession coming up, Hoang says, they must buy authentic software.

"The problem right now, when Microsoft comes in, when we enter the WTO, they do have the trademark licensing," said Hoang. "So that we, as the entrepreneur, we have to purchase it."

Hoang says buying real software will cost the company $30,000 to $40,000.

Other Vietnamese entrepreneurs are happy about the stronger copyright laws. Nguyen Quoc Ky, director of tour operator Vietravel, hopes the law will help him protect his trademark.

"Vietravel is very famous in Vietnam and something in the world. Now, of course, after [becoming] famous, many people here like this name Vietravel, and make the same name as my company," said Ky. "For example, they make the name Vietrang, Vietrang Travel, Vietrang Tour, Viettour - there are many."

Vietnam did not negotiate a transition period before observing TRIPS. That is unusual, says Vice Minister of Trade Luong Van Tu, who led Vietnam's delegation at the WTO negotiations in Geneva.

Tu says Vietnam's immediate acceptance of TRIPS shows its strong determination to enforce intellectual property laws. He says there will be no sharp crackdown on violators, because copyright protection requires consistent enforcement instead of short, intermittent sweeps.

But the DVD shop owner says it looks to him like a crackdown has started. The owner says police have begun visiting his store more frequently.

In many CD and DVD stores, the result is already noticeable. Some have moved their legal merchandise to the front of the store. The pirated DVDs are still there, of course - just ask the owner to open that big metal door at the back of the shop.