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Cablegate: President Calderon, Governor Pena Nieto, Vow To

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PP RUEHCD RUEHGD RUEHHO RUEHMC RUEHNG RUEHNL RUEHRD RUEHRS RUEHTM
DE RUEHME #1678/01 0931706
ZNR UUUUU ZZH
P 031706Z APR 07
FM AMEMBASSY MEXICO
TO RUEHC/SECSTATE WASHDC PRIORITY 6293
INFO RUEHXC/ALL US CONSULATES IN MEXICO COLLECTIVE PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY
RUEAHLA/DEPT OF HOMELAND SECURITY PRIORITY
RUEAWJA/DEPT OF JUSTICE WASHDC PRIORITY
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY

UNCLAS SECTION 01 OF 02 MEXICO 001678

SIPDIS

SIPDIS

STATE FOR WHA/MEX/ROTH AND EB/TPP/MTA/IPC/WALLACE
STATE PASS USTR FOR
EISSENSTAT/ESPINEL/MELLE/SHIGETOMI/BAE/MCCOY
STATE PASS COPYRIGHT OFFICE
COMMERCE FOR ITA/JACOBS/WORD/WILSON/WRIGHT
COMMERCE PASS USPTO
JUSTICE FOR CCIPS/MERRIAM/KOUAME

E.O. 12958: N/A
TAGS: KIPR ECON PGOV MX
SUBJECT: PRESIDENT CALDERON, GOVERNOR PENA NIETO, VOW TO
COMBAT PIRACY

Summary and Comment
-------------------

1. Last week at two separate events, Mexican President
Calderon and the governor of the State of Mexico vowed to
combat the trade in pirated and counterfeit goods, arguing
that strong IPR protection is a necessary condition for
attracting investment, strengthening competitiveness, and
generating quality jobs. Calderon specifically called on the
Inter-Secretarial Commission for Combating the Illegal
Economy, spearheaded by the Secretariat of Governance, and
Mexican Customs to lead the fight at the national level. The
following day, Governor Pena Nieto presided over the signing
of an agreement that pledged his state government to fighting
piracy in coordination with the federal government and the
private sector. Hopefully his example will encourage other
governors to follow suit. Political commitment from the top
will be key to improving Mexico's protection of IPR. Post
will be following up to see if federal and state actions
match last week's welcome rhetoric from the President and the
governor. End summary and comment.

Calderon's Speech
-----------------

2. On March 28, President Calderon inaugurated the 52nd
General Assembly of the National Chamber of Apparel
Industries. He used the occasion to deliver a speech in
which he pledged his government's commitment to combating
illicit commerce in pirated and counterfeit goods and unfair
foreign trade practices (see septel for more on the latter
issue). Regarding the former, Calderon argued that an
economy cannot develop on a foundation of illegality, and
noted that organized crime groups have now taken control of
contraband markets in Mexico. He declared that the state
cannot permit brazen transgression of any law to pass with
impunity, and said the legislative, executive and judicial
branches of government at the national, state, and municipal
levels need to join hands with all social sectors to fight
piracy, counterfeiting, and contraband trade. To that end,
he said, he had instructed the Secretariat of Governance to
intensify the efforts of the 'Inter-Secretarial Commission
for Combating the Illegal Economy' (which Governance chairs
-- the Prosecutor General of the Republic, or PGR, also
participates) to go after organized crime. (Note: Post will
seek clarification of the respective roles of the
Inter-Secretarial Commission mentioned by Calderon and
another GOM interagency initiative -- the Inter-Institutional
Committee for the Protection of IPR -- which is headed by the
PGR. End note.) He said the government has also set in
motion a program to modernize and professionalize Mexican
Customs in order to re-double their anti-piracy efforts.

State of Mexico Signs Agreement
-------------------------------

3. The next day, at a separate event, Governor Enrique Pena
Nieto of the State of Mexico (the country's most populous
state -- it does not/not include Mexico City), presided at
the signing ceremony of the "Coordination Agreement for
Preventing and Combating IPR Infringement, Contraband, and
Stolen Merchandise." The agreement, which was signed by the
State of Mexico's Secretary General and a representative of
an umbrella group of IP-related companies and industry
associations, is modeled on the "National Agreement Against
Piracy" that was signed by the federal government and private
industry in 2006. It is the first such agreement signed by a
state government, though industry is hoping to convince more
governors to follow suit, with the State of Morelos appearing
closest to doing so. The main objectives of the agreement
with the State of Mexico are to: fight IPR infringement and
other forms of illegal commerce; recover the legitimate
market lost to illegal trade; incentivize vendors of illegal
goods to switch to legitimate goods; and improve the
investment climate of the state. The state government
pledges to work toward these goals in coordination with
industry and the federal government. The director general of
Mexico's patent and trademark office (IMPI) and the federal
prosecutor for the State of Mexico were both present. The
state government will reform its laws to permit more

MEXICO 00001678 002 OF 002


aggressive action against illegal merchants, and make the
necessary funding available for the activities contemplated
in the agreement.

4. In his speech following the signing ceremony, the governor
stressed that education, a culture of legality, and sound
economic development were a proven virtuous circle, noting
that formal sector employment is far superior to informal
sector jobs. He lamented Mexico's poor IPR performance,
citing last year's Special 301 report, and asserted that
illicit trade in pirated, counterfeit, and contraband goods
was increasingly linked to powerful organized crime groups.
He vowed that the intentions reflected in the agreement would
become facts, and that his government would immediately
quicken the pace of enforcement actions in conjunction with
federal authorities.


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GARZA

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