Balkans need better intellectual property protection

16/01/2013

Experts say preventing piracy a significant step toward economic growth, attracting foreign investment.

By Ivana Jovanovic for Southeast European Times in Belgrade -- 16/01/13

Street vendors in Serbia draw the attention of police seeking to stop the sale of pirated merchandise. [Nada Bozic/SETimes]

While Balkan nations strive to improve intellectual property protections, experts say taking several key steps to reduce piracy would increase tax revenues and could make the region more desirable for foreign investors.

The governments in Macedonia, Serbia and Croatia have departments that monitor intellectual property violations. But while Serbia has 25 inspectors specializing in software piracy, the country's 20-year-old tribunal for intellectual property hears only a small number of cases.

Milos Blagojevic, intellectual property rights committee chairman of the American Chamber of Commerce in Serbia, told SETimes there are conflicting laws and a low level of coordination between institutions that protect intellectual property.

"Potential investors are not much interested to invest in a country where intellectual rights are not protected," Blagojevic said, adding that infringement of these rights has caused substantial losses to Serbia's economy.

Citing International Data Corporation statistics, Blagojevic said the value of pirated software in Serbia in 2011 was estimated at nearly 87 million euros.

"If the piracy rate would be dropped 10 percent, the state budget revenues could increase $20 million [14.9 million euros] and some 10,000 jobs could be opened, primarily in the IT industry," Blagojevic said.

The rate of software piracy in Bosnia and Herzegovina (BiH) is 66 percent, according to the Business Software Association (BSA).

"This has denied users and the state $15 million and it is showing how big the losses are for individuals and the state,” Mirna Milanovic Lalic, the BSA spokesperson in Bosnia, told SETimes.

Lalic said cooperation among countries in the region is crucial since piracy is not limited by borders.

In Croatia, the rate of software piracy is 54 percent, which accounts for losses of nearly 53 million euros, said Ivan Vidakovic, Microsoft Croatia director.

Piracy also impacts many other industries, including pharmaceuticals, automotive, tobacco, clothing, music and films.

"One company that produces consumer goods has estimated that state VAT revenue losses [due to piracy] for Croatia, Serbia and Bosnia and Herzegovina, are about 70 million euros," Andrea Doko Jelušić, director of the American Chamber of Commerce in Croatia, told SETimes.

Jelušić added that resolving piracy requires close cooperation among property rights owners and state bodies as well as excellent international cooperation among state bodies.

According to the BSA, Romanian police started criminal procedures in 80 software piracy cases and won 10 convictions during 2012.

Magda Popescu, outside counsel for the BSA, said software piracy in Romania is decreasing due to collaboration with the country's authorities.

"By continuing the partnership with the Romanian police, we aim to raise the awareness level in this field," Popescu said. "We hope to have better and better results that will have a significant impact in the Romanian economy."

Seeking to promote colaboration across the region, the American Chamber of Commerce in Belgrade organised the 10th Conference on Intellectual Property Rights, in December in Arandjelovac, Serbia. The event gathered representatives of the business sector and public administration from BiH, Montenegro, Croatia, Macedonia and Slovenia. Specialization of the judiciary in this area, networking of data on offenders and improved regional coordination were emphasized as key points.

"Respect of intellectual property rights is necessary for innovation and therefore vital for economic growth," said Vincent Degert, head of the delegation of the European Union to Serbia.

SETimes correspondent Gabriel Petrescu contributed to this report from Bucharest.

This content was commissioned for SETimes.com.