Nepal-USA Chamber reminds government of TIFA commitments

The Nepal-USA Chamber of Commerce and Industry (NUSACCI) strongly urges the Government including the Ministry of Industry, Commerce and Supplies (MOICS), to implement its commitments made during the Trade and Investment Framework Agreement (TIFA) Council Meeting held last September.

At the meeting, the importance of effective intellectual property right (IPR) protection and enforcement was emphasised as a critical factor in attracting trade and investment, particularly in IP-intensive industries, according to the binational chamber. 

Nepal’s initiatives in legal and institutional reforms related to IP, along with improvements in trademark administration and examination through the development of technical expertise, are essential to enhance consistency and reliability within Nepal’s IP Office, it adds.

NUSACCI has long been advocating for stronger IPR protection by organising various seminars and workshops on IPR-related issues and raising awareness within the business community regarding the use and misuse of international and domestic company trademarks and labels, it claimed, adding that the improper use of trademarks and counterfeit labels not only damages Nepal’s image domestically but also undermines its reputation internationally, thereby deterring potential foreign investment.

The recent notice of Kathmandu Metropolitan City (KMC) in this regard has drawn our attention and we hereby extend our solidarity with Kathmandu Metropolitan City, it adds

NUSACCI has requested and urged all concerned stakeholders to refrain from the unauthorised use of international and domestic company trademarks and labels. 

Government drafting Intellectual Property Rights Bill

As foreign investors have been asking Nepal to strongly enforce the intellectual property laws, the Ministry of Industry, Commerce and Supplies has started drafting Intellectual Property (IP) Rights Bill.
Though, Nepal has Patent, Design and Trade Mark Act 1965 and the Copyright Act 2002, the latest development in the market – especially to attract foreign investment – Nepal is under the pressure of framing new IP law.
The ministry is also pushing the legal framework also due to World Trade Organisation’s (WTO) recommendation. During the second Trade Policy Review of Nepal held in December 2018, the WTO had pointed out slow progress toward safeguarding the intellectual property rights in Nepal. “Nepal should have a more effective enforcement of competition policy and protection of intellectual property rights,” reads global trade regime in its concluding remark of the review meeting.
Since the cases on violation of intellectual property right are governed by the age-old laws, the country enforced its first National IP Policy in March 2017. Thus, the government is framing Intellectual Property Act, to incorporate all the issues related to intellectual property under a single legal framework.
The ministry felt the need for a separate law after realising that old laws cannot address emerging cases related to intellectual property. As the government wants to attract more foreign direct investment (FDI) to fill the resource gap, the foreign investors want their design be protected by the law. The ministry aims at finalising the draft in the one-and-a-half months.
The government has – before the Investment Summit – brought Public Private Partnership and Investment Act, and the Foreign Investment and Transfer of Technology Act (FITTA) to attract the foreign investment. But due to lack of intellectual property law, the foreign investors are not convinced.
According to the Department of Industry (DoI), the cases related to intellectual property rights have been growing with each passing year.
There has been lots of incidents of intellectual property rights violation – from various industries including products to music – in the country. Two years ago, a local company Kansai Nerolac Paints Nepal Pvt Ltd moved the court claiming a reputed Japanese company Kansai Paint’s brand in its name. The trademark dispute – which has frightened the international well known brands to enter Nepal – has still been under the court’s preview. In 2018, Nepali movie 'Kri' was accused of copyright violation for using music of an old movie in an unauthorised manner. The dispute was reportedly settled out of court for Rs 1.1 million.
According to some legal experts, there are some ‘professionals’, who have been registering the international well known brands and bargaining with them. The trend has distracted them from entering Nepal. Likewise, the imitatation of foreign brands in the domestic market is also on the rise.

Government endorses Integrated Intellectual Property Policy

The cabinet meeting today endorsed the Integrated Intellectual Property Policy-2073, after its bill committee gave a nod to the policy.
The new policy intends to address all issues related to protection of intellectual property (IP) rights of people, according to industry minister Nabindra Raj Joshi. "IP rights refer to the legal rights of individuals and organisations to creations of the mind like inventions, designs, and literary and artistic works, among others."
Currently, there are separate laws for the protection of industrial intellectual property rights and copyrights. While the Ministry of Industry is responsible for industrial intellectual property issues like patent, design, trademark and geographical indications (GI), the issues related to copyright fall under the jurisdiction of the Ministry of Culture, Tourism and Civil Aviation. Due to lack of a regulatory legal framework to deal with IP-related issues, Ministry of Culture, Tourism and Civil Aviation has currently set up the Nepal Copyright Registrars’ Office to deal with copyright-related issues. Similarly, a separate dedicated section at the Industry Ministry is dealing with cases on intellectual property like patent, design, trademark, GI, among others.
As a result, the two ministries earlier had reached an agreement to set up a common regulatory mechanism for intellectual property rights.
Nepal had acceded to the World Intellectual Property Organisation (WIPO) in 2005. It compels Nepal to report to WIPO about the progress achieved based on commitments of international treaties. Due to this, the government has identified the need for a single office to deal with intellectual property rights in the new policy instead of separate institutions dealing on this issue currently.
“Endorsement of the policy not only guarantees the IP rights of people and institutions but it will also encourage investment in the country in many ways,” Joshi said, adding that Industry Ministry will also expedite process to bring an act related to Intellectual Property soon.

Nepal among countries with weakest property rights in the world

Though, Nepal is ranked 97 out of 128 countries in terms of the strength of property rights in this year's International Property Rights Index (IPRI), it is still a nation with one of the weakest property rights in the world, landing at the bottom 20 percentile.
The IPRI – an annual publication of the Property Rights Alliance (PRA) –is a comparative study that aims to quantify the strength of property rights - both physical and intellectual - and to rank countries accordingly.
Nepal's ranking has shown a slight progress this year with a score of 4.5 – compared to a score of 4.2 last year – placing the country 17th in the Asia and Oceania and 97th in the world ranking, according to the Property Rights Alliance.
Political Environment (LP), Physical Property Rights (PPR) and Intellectual Property Rights (IPR) have each grown stronger with a score of 3.92, 5.5 and 3.97 this year compared to 3.4, 5.3 and 3.8 last year, the publication reads, adding that Nepal is, however, still a nation with one of the weakest property rights in the world, landing at the bottom 20 percentile.
IPRI scores and ranks each country based on 10 variables – in a scale of zero to 10 – reflecting the state of its Legal and Political Environment (LP), Physical Property Rights (PPR) and Intellectual Property Rights (IPR).
In Legal and Political Environment, it evaluates Judicial Independence, Rule of Law, Political Stability and Control of Corruption as sub-categories. Similarly, under Physical Property Rights, the sub-categories are Protection of Physical Property Rights, Registering Property and Access to Loans. Likewise, the sub-categories under Intellectual Property Rights are Protection of Intellectual Property Rights, Patent Protection and Copyright Piracy.
Finland is at the top spot this year index with 8.4 score. Other Scandinavian countries have also performed well with Norway and Sweden ranking fourth and seventh, respectively, with a score of 8.3 and 8.1.
At the bottom of the ranking are Venezuela (2.7), Haiti (2.8), Myanmar (2.8), Bangladesh (2.8), Zimbabwe (3.4), Burundi (3.4), Nigeria (3.6), Moldova (3.7), Pakistan (3.7) and Mauritania (3.7).
Property Rights Alliance has secured the support of 102 other think tanks and policy organizations in 69 countries involved in research, policy, development, education and promotion of property rights in their countries to prepare the report. Samriddhi, the Prosperity Foundation is the partner think tank in Nepal for Property Rights Alliance. It has proudly been releasing the International Property Rights Index – one of the most comprehensive international measurements of property rights around the world – in Nepal since 2012. From measuring the status of 70 countries in the first edition, the IPRI has grown to examine 128 countries in its tenth edition in 2016.
The index is expected to be helpful to politicians, economists, academicians, and entrepreneurs in learning about the necessity of protecting property rights around the world for world-wide economic growth, the publication adds.

The 2016 IPRI – toppers
Finland – 8.38
New Zealand – 8.27
Luxembourg – 8.26
Norway – 8.25
Switzerland – 8.16

The 2016 IPRI– bottom 15
Republic of Venezuela – 2.73
Myanmar – 2.76
Bangladesh – 2.77
Haiti – 2.84
Zimbabwe – 3.40
Burundi – 3.44
Nigeria – 3.56
Pakistan – 3.68
Moldova – 3.72
Mauritania – 3.73
Chad – 3.74
Lebanon – 3.83
Madagascar – 3.84
Ukraine – 3.93
Nicaragua – 3.98

Knowledge-based industry needs protection for economic development

As the country is moving towards the knowledge-based economy, the experts called for the protection of Intellectual Property Rights.

Promotion and protection of innovations and the knowledge in the country will eventually contribute to the development of the country and reduction of poverty in the country in the long run, said trade, commerce and supplies, and finance minister Shankar Prasad Koirala, at a seminar 'General Awareness Building on IPRs and its Role in Economic Development', organised by the World Intellectual Property Organisation (WIPO) in cooperation with the Department of Industry and Confederation of Nepalese Industries (CNI), in the Valley today.

Stressing on scientific and technological capacity building in the industrial sector that could be the base for the sustainable development of the country, he asked to encourage innovations, research and development in appropriate technologies, industrial information and communication, biotechnology, as stated in the Industrial Policy 2010 that could lead the country towards economic development, growth and a better quality of life through its proper utilisation.

He also informed that the government has established a Rs 20 million-Technology Development Fund to make use of appropriate technology in different industries.

Unlike in the past when people used to about the development of infrastructure, enhanced production, efficient manufacturing, the present world is much more focused on the knowledge-based economy, he said, adding that knowledge has been now recognised as the driver of productivity and economic growth.

Strengthening the regulatory regime in Nepal on the protection of Trade Related Intellectual Property Rights (TRIPS) was one of the four outstanding commitments of our accession to the WTO in 2004.

However Nepal has still to do a lot to bring the regulatory and enforcement aspects of Intellectual Property, Industrial Property and other related areas, up to their desirable levels. 

He also reminded that the government is committed to promote, protect and regulate the Intellectual Property, which has been translated in the Industrial Policy 2010.

Industrial Policy 2010 has spelt protection and promotion of the industrial Intellectual Property Rights as one of its objectives. It has also envisioned an IP office to promote, regulate and administer all the aspects of Intellectual Property, apart from National IP Policy that will look into the IP issues and help establish an IP regime more effectively.

The new Industrial Enterprises Act will also help promote the IPR, the minister said, adding that the IPR protection will help attract more investments to the country.

If the country protects IPR, the foreign investment will flow in, said CNI president Narendra Kumar Basnyat. "However, level of protection is far behind in Nepal compared to our neighbours," he added.

The IPR is an essential tool to promote, protect and reward the creators of the intellectual property and make sure the use of the property for public benefit and welfare, trade secretary Krishna Gyawali said, on the occasion.

"Although the country has some 48 years old Patent Design Trademark law, the Department of Industry is doing its homework to bring a new IPR law," he added.

Nepal sees no improvement in property rights

Nepal has neither improved its rank nor score in the International Property Rights Index for the year 2013.

According to the report published by Property Rights Alliance (PRA) based in Washington DC, Nepal ranked 101^st – among the 131 countries – in the International Property Rights Index 2013 with a score of 4.5 out of 10, whereas in the year 2012 also Nepal was at the same rank.

From 2009 to 2013, the overall IPRI score of Nepal has not changed.

However, between 2012 and 2013 the IPRI score improved by 0.1 points. In fact, all three components gained 0.1 points during this time period.

Legal and Political Environment grew by 0.1 points due to a 0.2 point increases in Judicial Independence and Political Stability, whereas a significant 0.4 point gain in the item Protection of Physical Property Rights helped lead to a 0.1 point higher Physical Property Rights component score. Likewise, the 0.1 point increase in Intellectual Property Rights is due to a 0.2 point increase in Protection of Intellectual Property Rights.

The International Property Rights Index is an annual comparative study that aims at qualifying the strength of property rights – both physical and intellectual – and ranks the countries based on 10 factors reflecting the state of Legal and Political Environment (LP), apart from Physical Property Rights (PPR) and Intellectual Property Rights (IPR).

The 2013 report – that is based on 131 countries explores the last five years between 2009 and 2013 – represents 98 per cent of the world gross domestic product (GDP) and 93 per cent of the world population.

Nepal falls under the bottom 20 per cent average per capita income by International Property Rights Index quintile, whereas on an average, countries in top 20 per cent quintile of the index showed a per capita income around seven times that of bottom quintile countries.

The hardline UCPN-Maoist government that has no respect for individual liberty and property rights, and believe in authoritarian rule has been still confusion that the rejection of property rights means the rejection of wealth creation forcing the country to poverty.

According to the 2013 report, Finland leads the 2013 ranking with a score of 8.6, followed by New Zealand and Sweden with 8.4, and Norway with 8.3. Likewise, Singapore leads in South East Asia with 8.1 score.

Top five

1.     Finland (8.6)

2.     New Zealand (8.4)

3.     Sweden (8.4)

4.     Norway (8.3)

5.     Netherlands (8.2)

6.     Switzerland (8.2)

7.     Luxumberg (8.1)

8.     Singapore (8.1)

Bottom five

131. Yemen (3.1)

130. Venezuela (3.4)

129. Burundi (3.4)

128. Haiti (3.4)

127. Libya (3.4)

126. Bangladesh (3.5)

125. Algeria (3.7)

124. Zimbabwe (3.8)

Focus on attracting foreign investment: UK envoy

Ambassador of the United Kingdom to Nepal Andy Sparkes today suggested to focus on attracting foreign investments rather than relying on development aids.

Speaking at a panel discussion, during the launch of revised and updated version of ‘Unleashing Nepal’, a book authored by Sujeev Shakya and published by Penguin, he said that donors must co-ordinate and find common grounds to work on for development aid to be more efficient.

“Nepal has a huge human capital for the service industry like tourism,” he added.

In the programme moderated by executive director of Accountability Lab – a US based organisation that is operating in Nepal and Liberia – Blair Glencorse, Sparkes also provided a perspective on how the diplomatic and development community viewed Nepal.

Organised by Nepal Economic Forum, the panel also discussed on the journey of positive transformation in the economy through the perspective of various people from diverse backgrounds.

The revised book – first published in 2009 had earned the dubious reputation of being a ready reckoner for understanding past, present and future of the Nepali economy – provides an update on unprecedented transformation that the country has gone through over the last five years, said the author of the book Shakya.

Likewise, economist Chandan Sapkota stressed the need to develop infrastructures for energy, transportation and ICT for the overall development of the economy.

He also stressed on the positive macroeconomic indicators like the economy is growing at around four per cent in the last four years. “The growth of the service sector specifically stands at nine per cent,” Sapkota said, adding that it is the service sector that the government needs to focus its energy on. He also pointed out that the fact that Nepal is well on its way to meeting its Millennium Development Goals (MDGs).

Speaking on the occasion, managing director of Unilever Nepal Sirkanth Srinivasmadhavan said that rising consumption rate is drawing lot of potential investors to the country. “Nepal is a market with a lot of potential for investors,” he said, adding that there is an urgency to develop Nepal’s competitive advantage by measures such as leveling the playing field for foreign investors, promoting transparency and safeguarding Intellectual Property Rights (IPR). “Although MNCs in Nepal have been able to do reasonably well.”

Taskforce to check piracy on cards

Nepal Copy Right Office is planning to form a Joint Anti-Piracy Task Force including representatives from various organisations directly and indirectly affected by piracy and copyright issues to increase awareness of copyright among the business community and consumers, according to a draft action plan.

Similarly, the action plan has also envisioned an Anti-Piracy Promotion Fund with regular support from participating organisations of Joint Anti-Piracy Task Force.

The expression industry has to get its due recognition, said registrar at the office Bisu KC at an interaction organised by the US Embassy and Samriddhi Foundation, here today.

Joint secretary at the Ministry of Culture, Tourism and Civil Aviation Bishnu Raj Karki, appreciating the idea of the joint task force. He also suggested a formal advisory body under Nepal Copy Right Office to unify and guide the effort.

The ministry will support the initiative to save the expression industry and could arrange a national convention by the end of the fiscal year, he informed.
The expression industry’s contribution to the GDP stands at around 10 per cent in the developed countries, but the government has not yet recognized its contribution, Karki said, adding that the piracy has bleed the government coffer blue.

Music Association of Nepal has its own action plan to fight piracy, said immediate past president of the association Bhagwan Kumar Shrestha. "The association has both short-term as well as long-term goals, he said, adding that the plan includes awareness campaigns, stakeholders' self-initiation, monitoring and proper implementation of law in the short-term. "Likewise, in the long-term, he shared, "continuing the short-term plan for at least five years will help reduce piracy by at least 30 per cent."

The idea of intellectual property as private property has to be instilled in the society. Not only the creator, but also the government is losing out on taxes due to piracy that needs to be checked, Shrestha added.