Figure 18 depicts the relationships of the different sectors with regards to intellectual property rights. Basic to this analysis is the understanding that this concern comprises legal, economic and social issues. The legal aspect of it involves the laws governing the IPR and the judicial processes involved in trying IPR cases. These are the de jure institutional arrangements wherein the main authority recognized is the government. The Philippines has confronted this issue by passing laws that aim to protect the rights of IP stake-holders. The progress in this area is continuous as the legal system tries to adapt to the changing environment in the different sectors affected by IPR. Further, for better implementation of the said laws, continuous development of the human capital is being undertaken. However, IPR concerns are also affected by technological advancements. Legislations dealing with technological changes are needed for timely and effective regulations to curtail IPR infringements. The Philippine legislation responded to this need through the passage of the E-Commerce Law and the Optical Media Act.
The social side of IPR deals with the social attitudes and customs towards the legitimacy of the rights on intellectual property. One of the vital concerns in intellectual property rights, or any property rights issue for that matter, is the acceptance of society that intellectual property is an asset in which rights can be allocated to. That it is an income stream that needs management, hence, the provision of the rights. It is significant, therefore, that this knowledge or thinking be ingrained in the value system or norms of the society. By doing so, individuals will be able form expectations that one may be hold on in his dealing with others. Creation of de facto arrangements -- that is, self enforcing rules of property that have evolved out of the interactions of individuals -- regarding the allocation and management of intellectual property rights is possible as a result of this development.
First in this concept is the acceptance and recognition of people that a person has a right and claim over the benefits and economic rents from his intellectual property. That the song, movie, or design, is a private property of the creator, and the consumers are only provided with limited rights over it when bought in the market. At a given price, selling price of the commodity, the consumers are extended with use rights over the property, but not reproduction rights, management rights, etc. Basically, people gain absolute rights on the medium wherein the intellectual property is stored, but limited rights over the content. When these ideas are absorbed by society, individuals may develop their own arrangements in protecting the IPR of stake-holders. However, it should also be mentioned that the responsibility of protection does not only lie on the consumers, but also on the IP stake-holders themselves. They, too, must be dedicated in safe-guarding their rights and persevere in the cause. With this, new social practices may evolve with regards to the interactions of an individual vis-à-vis other people.
One such arrangement that may possibly emerge is the banning of mall and infrastructure owners on the sale of pirate and counterfeit products in their establishments. Legal measures need not be put in place -- though they would definitely strengthen the authority of the arrangement -- but merely the cooperation of the owners themselves can be an effective measure. They may set up their own set of operational and collective choice rules in dealing with the issue. Consumers can also bond together and set up their own norms regarding the IP protection.
In this line of thought, education of the public regarding the IPR issues must mainly deal with changing the cultural perception of society. Consumers do not see that infringing on the rights of other people is stealing, because they are not directly affected by the violation. Only a small percentage of the population are artists, writers, inventors, innovators, designers, etc, hence, people do not feel the "real" damage. Moreover, the macroeconomic effects of these IPR violations, i.e. lost revenues, forgone investments and opportunities, are also abstract in concept to an ordinary consumer.
In order to prevent this alienation of the consumer to the intellectual property asset, intellectual property protection must also involve intellectual property development. Filipinos must be encouraged to innovate, invent, and create. The government needs to invest in R & D in the Philippines for advancement of the Filipino intelligence and creativeness. Philippine research and development in the IP related industries such as biotechnology, IT, chemical manufacturing, etc., must be supported for Filipinos to be able to identify with, and better appreciate the concept of intellectual property protection.
On the economics side, an important factor that helps piracy and other IPR infringements survive is the continuous support given by society in these activities. Without the demand, no one will produce the supply. This is one area in which the Philippines also needs to emphasize on. The IPR activities have mainly concentrated in the supply aspect of the problem, as seen by the increasing intensity of IPR enforcement actions through the years. The different government agencies involved in IPR protection have targeted the producers and distributors of the pirate and counterfeit products circulating in the market. This produced positive results, as seen by the declining piracy rates, specifically in the software and video industries.
However, the piracy rates are not the sole indicator of the state of IPR infringement. To evaluate the situation, we must use the combination of the different indicators such as: the levels of consumption of pirate and legal goods, their growth rates, the expansion/contraction of the legal and pirate markets, the price factors, etc. Hence, the demand side of the market must also be dealt with, for the supply and demand are the major economic forces that influence economic decisions of individuals.
In considering the demand of consumers, we enter into the area of market prices. We must admit that the primary cause of the continuous proliferation of piracy is the wide price gap between the legitimate and pirate goods. Though it is impossible for legitimate products to have a price competitive with that of the pirate goods’, producers must acknowledge this factor, and address the concern in the best possible way.
Taking into account these factors, the task for IP protection is legal, economic and social in nature. Therefore, it is relevant that we must focus, not only on one aspect the intellectual property rights concept. Efforts must be directed in all three. Furthermore, it is not enough for the government to fight IPR infringements alone. The support of the IP stake-holders, and the public as well, is very much important for the effort to be a success.