Music piracy issues should be urgently addressed during visit by high-level EU delegation to Russia

April 21, 2004

The European recording industry has urged President Prodi and EU Commissioners to address the unacceptably high levels of music piracy in Russia during tomorrow's visit to Moscow by a high-level EU delegation. Russia is the number one source of illegal music recordings in the European Union and Accession countries. It is also the second largest pirate music manufacturer in the world - surpassed only by China. IFPI, the organisation representing the recording industry worldwide, has therefore called on President Prodi and the seven EU Commissioners travelling to Moscow to take this opportunity to press Russia to bring levels of intellectual property protection in line with EU and international standards.

Pirate music made in Russia saturates the Russian market, accounting for 64% of the total music sales and 75% of CD sales. This piracy has a devastating impact on investment in the local industry and local artists as well as foreign investment. Russian CD manufacturing capacity is over 10 times greater than legitimate demand, resulting in the massive export of pirate discs from Russia to the rest of Europe. Losses to copyright holders are estimated at more than 1 billion Euros annually.

The recording industry urged the European Commission to make effective action on intellectual property a pre-condition of Russia's admission to the World Trade Organisation. Jay Berman, IFPI chairman and CEO, said: "I cannot emphasise enough the need for the Commission to ensure that Russia implements the international intellectual property rules in the TRIPS Agreement in word and spirit before it can be admitted to the WTO. "

Russia should also comply with the EU-Russia Partnership & Cooperation Agreement under which Russia agreed to provide a similar level of IPR protection in Russia as exists in the EU by January 2003. Fifteen months after this deadline, Russia is still far from fulfilling this obligation. Russian copyright law does not provide any protection whatsoever for pre-1995 recordings.

IFPI stressed that the following actions by Russia should be strict pre-conditions to Russia's WTO Accession:

Amendment of the Russian copyright law: to provide full retroactive protection to foreign works and phonograms - including pre 1995 international repertoire; and to enable Russia to join the WIPO Treaties of 1996.
Adoption an effective optical disc law to address the production and distribution of optical discs.
Closure of disc manufacturing plants involved in illegal production by withdrawing licenses - particularly as regards plants located on state-owned military industrial complexes.
Effective and immediate action in response to criminal and civil complaints filed by right holders.
Introduction of more widespread and effective enforcement activities.

For further information please contact:
Francine Cunningham, IFPI European Office, Tel: +32 2 511 92 08
E-Mail: francine.cunningham@ifpi.org

Note to editors: Russia currently has 30 replication plants with annual manufacturing capacity of 371.6 million CDs and 38 million DVDs. To compare figures: in 2003 only 30 million legitimate music CDs were sold. Eight production plants are located on the facilities of Russian military-industrial enterprises.

The seven Commissioners accompanying President Roman Prodi to Moscow tomorrow are Pascal Lamy (Trade), Chris Patten (External Relations), Gunter Verheugen (Enlargement), Antonio Vitorino (Justice and Home Affairs), Loyola de Palacio (Transport and Energy), Margot Wallstrom (Environment) and Philippe Busquin (Research).