Schema in ICourseFolder:

    section = schema.Choice(
        title=_(u'Organization, unit or study-subject in Korppi'),
        vocabulary=u"jyu.opetusohjelma.Sections",
        required=False)


# Vocabulary for the schema
class SectionsVocabulary(object):
    grok.implements(IVocabularyFactory)

    def __call__(self, context):
        terms = []
        sections = KorppiQueryUtility().getOrganizations()
        for section in sections:
            # Section[1] is orgname
            terms.append(SimpleVocabulary.createTerm(section[1]))
        return SimpleVocabulary(terms)
grok.global_utility(SectionsVocabulary, name=u"jyu.opetusohjelma.Sections")


def getOrganizations():
     query = urllib.urlopen(KORPPI_URL).read()
     import json
     korppiOrgs = json.loads(query)
     # strings in korppiOrgs are unicode

     organizations = []
     for org in korppiOrgs['organisations']:
         orgid = org['id']
         orgname = org['name'] + ' (ID: %s)' % (orgid)
         organizations.append((orgid, orgname.encode('utf8')))
     return organizations

Gives us UnicodeDecodeError:

 Module zope.tal.talinterpreter, line 518, in do_optTag
  Module zope.tal.talinterpreter, line 513, in no_tag
  Module zope.tal.talinterpreter, line 343, in interpret
  Module zope.tal.talinterpreter, line 852, in do_condition
  Module zope.tal.talinterpreter, line 343, in interpret
  Module zope.tal.talinterpreter, line 405, in do_startTag
  Module zope.tal.talinterpreter, line 502, in attrAction_tal
UnicodeDecodeError: 'ascii' codec can't decode byte 0xc3 in position 12: ordinal not in range(128)

If we do not encode, the Vocabulary will crash:
 Module Products.Five.schema, line 36, in get
  Module jyu.opetusohjelma.vocabularies, line 51, in __call__
  Module zope.schema.vocabulary, line 109, in createTerm
  Module zope.schema.vocabulary, line 39, in __init__
UnicodeEncodeError: 'ascii' codec can't encode character u'\xe4' in position 11: ordinal not in range(128)