Mon, Apr 16, 2001 page18

• BOFT director trades problems for solutions

  The Board of Foreign Trade has recently coordinated a series of discussions between US trade negotiators and relevant government agencies on topics from IPR infringement to foreign investment barriers in the telecommunications industry. BOFT Director Wu Wen-ya (吳文雅) took some time out to discuss the results with 'Taipei Times' staff reporter Richard Dobson.

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  Taipei Times: Prior and after recent talks in Taipei with US trade negotiators, Council of Agriculture Chairman Chen Hsi-huang (陳希煌) told the media that the government might consider dropping its commitments under the "down payment" import system if Taiwan is not admitted to the WTO this year.

  Wu Wen-ya: The Taiwan government will continue to honor the commitment -- the so-called down payment -- which was made during the WTO market access negotiations with the United States in 1998. Before they came ... [the US Trade Representatives] learned that the Chairman of the Council of Agriculture had said `we will not honor our commitment in regard to the poultry quota if we cannot get into the WTO by the end of this year.' But I told them that my government would honor the commitment.

  

  Director of the Board of Foreign Trade, Wu Wen-ya, discusses Taiwan's trade relationships.

  PHOTO: CHEN CHENG-CHANG, TAIPEI TIMES

  TT: Could you elaborate on the development of the down payment system and its importance to Taiwan's WTO entry?

  Wu: Originally, the import of chicken meat, pork belly, beef offal and pork offal was prohibited. But because we want to get into WTO we had to have market access negotiations with those WTO members that requested them. First in 1998 we reached a bilateral arrangement with US and then Australia and New Zealand and Canada. The following year we lifted the ban on these meat imports to all WTO members. So because of the statements by Council of Agriculture Chairman Chen not only the US raised their concern about this issue, but also New Zealand and Australia.

  But there is no doubt that we will continue to honor our commitment in this regard. An inter-agency meeting has already taken place and we got a consensus that we will continue to honor our commitments.

  TT: US negotiators also expressed concern about what they described as Taiwan's serious limitations on foreign investment in the telecommunications sector. How do you view their complaints?

  Wu: The US government is never satisfied. They always give you pressure. They say they are very concerned about telecommunications liberalization. But in 1998 we agreed to liberalize our telecoms sector beginning July 1 this year. Actually we have already liberalized our telecoms sector. Right now there are three big companies that last year were granted fixed-line telecom service licenses. But they asked us whether we will accept applications for more fixed-line licenses again beginning on July 1. Our argument is that we have already liberalized our telecoms sector ... especially in the area of fixed-lined licenses. In addition, the Ministry of Transportation and Communications has already set up a telecom liberalization task force which is reviewing all the comments from local and foreign operators. So the concerns raised by the US negotiators have already been taken into account when reviewing the liberalization policy.

  This task force will make a policy recommendation to the transportation ministry, but the US delegation again said we will pay very close attention to the issue.

  TT: Taiwan has long had the unfortunate reputation as being a major global source of pirated goods, in particular pirated compact discs (CDs). Despite the drafting of a new law to combat this, US negotiators still weren't happy. Why?

  Wu: The first point the US negotiators raised about our draft Optical Media Management Law was that it didn't have a criminal penalty article. Actually we have repeatedly explained our viewpoint to the US trade delegation and American Institute in Taipei that if you want to insert a criminal penalty it will probably encounter resistance when the draft law is reviewed in the Legislative Yuan.

  Even in the Cabinet we have had to try very hard to persuade representatives from the Ministry of Justice [to accept this idea] because they don't think legally it is appropriate to put criminal penalty into the law.

  But the US side still insists that we have to do so.

  TT: Is the original draft of the law adequate to curb intellectual property right (IPR) piracy in Taiwan?

  Wu: We told the US side [that enforcement of the law] would be really efficient if we used our own original draft. Under the original draft, a company that is found producing pirated CDs will have the machinery confiscated.

  This machinery is very big and valuable. If they don't have the equipment they can't produce pirated CDs. It's very efficient. And when pirated CDs destined for export are discovered by our customs people, those CDs will be confiscated and destroyed. In addition, the perpetrators will be subject to a fine.

  However, the US is concerned that the fine is too low so we are trying to increase its value. We think that penalty is enough. Enough to deter our people from doing it. But they [the US] still don't believe our original draft will work.

  TT: What are your reservations about adding a criminal penalty article to the law?

  Wu: The criminal penalties for producing pirated CDs, for example, would be -- according to the US idea -- a sentence of two or three years in prison. But that case would have to go before a prosecutor and a judge. The legal process must be completed, but it takes a long time maybe two, three or even five years. According to our original draft immediate action can be taken.

  TT: In light of US displeasure over local IPR legislation, do you expect Taiwan to be placed on America's "super 301" watch list this year?

  Wu: No comment. We will do our best. There were three areas in which the US has raised concerns. One was that the manufacture of pirated CDs must be stopped. Another is the copyright law.

  We have to make some amendments in order to be consistent with WTO TRIPS Agreement (trade-related aspects of intellectual property rights). The other one they are concerned about was the patent law.

  They want us to extend the protection period from 15 years to 20 years. The Intellectual Property Office is the competent authority [for handling this issue] and they are trying to address US concerns.

  TT: Last week the EU initiated an anti-dumping investigation into Taiwan CD-R (recordable compact disc) makers and is threatening high tariffs. Are the charges justified?

  Wu: It's too early to say. The anti-dumping case was just initiated. It depends on the results of the investigation. In anti-dumping cases you can't tell whether the charges are justifiable or not until the results of the investigation come out.

  TT: What has been the response to the charges?

  Wu: Last week we held a meeting to discuss this issue with industry [leaders]. The Taiwan Electrical and Electronic Manufacturers Association (台灣電子電機公會) has agreed to organize those companies that are identified by EU. In this case our industry people will hire lawyers with the Board of Foreign Trade assistance to help them handle the dumping questionaires from the EU.

  TT: China's entry into the WTO keeps getting held up. What is holding up China's negotiations and when do you expect China, and subsequently Taiwan to enter the organization?

  Wu: The most significant topic China has right now with other member countries especially the US is the issue of so-called domestic agriculture subsidies. We now are paying very close attention to this because if they cannot finish their WTO accession process we have to wait.

  The important WTO members including the EU and US are working towards a goal so that both sides -- China and Taiwan -- are admitted to the WTO at the same time. Now countries like the US and the EU expected that both sides could become members before the fourth WTO ministerial meeting which will be held from Nov. 9 to 11. We are hopeful on that date.
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