Peruvian Piracy Costing U.S. Companies

When Peruvian author Alfredo Bryce Echenique visited Lima last year to promote his latest book, he found illegal copies circulating before he even finished his tour.

Worst yet, the pirate publishers indiscriminately hacked out sections of “Don’t Wait for Me in April” to cut down on their own printing costs.

Most Peruvians would not be surprised that Bryce, an internationally known novelist who now lives in Paris, would be pirated in his native land.

A vast array of bogus products--from audio cassettes to computer software, cosmetics to medicines, sneakers to blue jeans--can be found in just about any public market or street bazaar in the country.

“The pirate doesn’t reproduce a book that nobody knows. He copies bestsellers, books by famous authors, because they are easier to sell,” said Ruben Ugarteche, head of the copyright section of Indecopi, Peru’s consumer protection agency.

The International Intellectual Property Alliance in Washington says pirating of movies, music, computer programs and books in Peru cost U.S. companies $30 million in 1994, the last year for which figures are available.

The situation is even worse in some neighboring countries, although the region trails far behind China, which American trade groups say cost them $2.3 billion from illegally copied products.

Venezuela, with slightly fewer people than Peru’s 24 million, cost U.S. firms $123 million from piracy in 1994, the International Intellectual Property Alliance says. Brazil was Latin America’s worst offender, accounting for $438 million in losses.

Robert Armstrong, economic officer at the U.S. Embassy in Lima, says piracy in Peru is on the American government’s watch list.

“It is part of the whole lawlessness that affected the country during 15 or 20 years of economic collapse and terrorism,” Armstrong said.

Benny Sterental, general manager for Microsoft in Peru, estimates 90% of all software used in Peruvian computers is pirated. “It is a fairly alarming figure,” he said.

Peru’s government is taking steps to crack down.

A new copyright law doubles jail time for offenders from four to eight years, and raids and confiscations of bootleg products are now common.

The government has cracked down particularly hard on illegal copies of movie videos and medicines.

But phony merchandise is almost a way of life for Peruvians.

A recent public interest television spot went so far as to advise consumers to cut plastic bottles with a knife to keep them from being salvaged from the trash and recycled with imitation stuff.

On Lima’s busy Abancay Avenue, a woman in a faded flower-print dress offers passers-by a whiff of a “name brand” shampoo that she is selling for a bargain price of 5 soles, a bit more than $2.

The shampoo comes in a plastic bag with a small bottle of cologne as a “yapa,” a Spanish term for a bonus tossed in to entice a sale. Both products have basically the same nondescript perfume odor.

A couple of doors down, drug store manager Jorge Peso chuckles.

“Here you can’t distinguish much because they use the same containers,” he said. “Anything in a bottle can be adulterated. They give the characteristics--the smell--but it is not the same.”

In his store, the authentic shampoo alone costs 10 soles.

A few blocks away in the crowded Mesa Redonda street market, vendors hawk pirated tape cassettes with printed covers.

Behind the main post office in the Polvos Azules market, a shoe seller offers authentic Adidas athletic shoes alongside a poor imitation. The copy, with a shoddy plastic sole, is emblazoned “Adldas”--with an l, not an i.

Peru is one of the poorest countries in Latin America, and most Peruvians worry little about trade names and copyrights in their struggle for survival. The country has also gone through years of economic crisis when it imported virtually nothing and bogus products were the average consumer’s only option.

Luis Alonso, head of Indecopi’s trademark and patent office, says most people who buy pirate products know they aren’t getting the real thing. In a country where the minimum monthly wage is 130 soles, or about $54, price is the key issue with consumers.

“They buy because where else can you get an Adidas T-shirt, for example, for a buck, a buck-and-a-half,” Alonso says. “The buyer knows he’s not buying a real Adidas T-shirt, but he likes for it to say ‘Adidas’ anyway. It is the illusion.”