Statement by IFPI Chairman and CEO Jay Berman on US trade sanctions on Ukraine

London, 21 December - Speaking on behalf of the international recording industry after the sanctions announcement by the United States Trade Representative, Jay Berman, IFPI Chairman and CEO, said:

"Sanctions are not what the international music industry had hoped for, but after the vote in the Rada, they were inevitable. We would have preferred a good law and its enforcement because that would have led to the development of a legitimate recording industry in the Ukraine. The Ukrainian Parliament chose to protect the pirates and sanctions are the consequence. The international recording industry is enormously appreciative of the tireless support that the US Government has given us on this issue over the last two years."

"We are deeply disappointed that Ukraine has failed to pass the regulations it needs to properly monitor against CD piracy. The decision by the Rada (the Ukraine parliament) to reject draft laws regulating the manufacture of CDs is an outright breach of the agreement struck last year with the US Government. Without those laws, Ukraine's CD manufacturing plants will remain a long term threat to legitimate music markets throughout Europe and internationally."

The draft law was rejected on 20th December by the Ukraine Parliament. There were 204 votes in favour of the draft optical disc control regulation, 12 short of the number needed for the law to be adopted.

Ukraine has annual CD manufacturing capacity of up to 70 million CDs, a level totally mismatched to legitimate demand of less than 5 million CDs. Pirate CDs from Ukraine have been found in more than 30 countries around the world.

In June 2000, US President Clinton and Ukrainian President Kuchma signed Joint Action Plan under which Ukraine agreed to:

• close down and prosecute CD plants that have been involved in large-scale production
• seize and destroy all pirate materials
• carry out regular and unannounced inspections of CD plants
• introduce and enforce strict optical disc production control regulations, includling the compulsory use of identification codes in the CD replication machinery and control of trade in equipment and raw materials
• introduce new laws to improve protection for foreign artists and record producers, and appropriate criminal penalties for copyright and related rights infringement

For further information, contact: Adrian Strain, 44 207 878 7900