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Cablegate: El Salvador: 2010 Special 301 Input

VZCZCXYZ0002
RR RUEHWEB

DE RUEHSN #0252/01 0572218
ZNR UUUUU ZZH
R 262217Z FEB 10
FM AMEMBASSY SAN SALVADOR
TO RUEHC/SECSTATE WASHDC 0454
INFO WHA CENTRAL AMERICAN COLLECTIVE
RUCPDOC/USDOC WASHINGTON DC

UNCLAS SAN SALVADOR 000252

SENSITIVE
SIPDIS
DEPT FOR EEB/TPP/IPE
DEPT PLEASE PASS USTR

E.O. 12958: N/A
TAGS: ECON ETRD KIPR ES
SUBJECT: EL SALVADOR: 2010 SPECIAL 301 INPUT

REF: 10 STATE 3361

1. (U) SUMMARY. El Salvador continues to comply with CAFTA-DR and
TRIPS IPR obligations and improve IPR protection. The GOES
implemented data protection regulations for agricultural chemicals
in 2009, its last outstanding CAFTA-DR IPR obligation. Stronger
enforcement efforts started in 2008 have continued through 2009.
Post therefore recommends against including El Salvador in the
Special 301 report. END SUMMARY.

LEGAL FRAMEWORK/DATA PROTECTION/TREATIES

--------------------------------------------- -----------------

2. (U) El Salvador has implemented legislation and acceded to IPR
treaties as required by Chapter 15 of CAFTA-DR. Additionally, El
Salvador acceded to both the World Intellectual Property
Organization (WIPO) Copyright Treaty (WCT) and Performances and
Phonograms Treaty (WPPT) in 1998, and the WIPO Trademark Law Treaty
in 2008.

3. (U) El Salvador implemented data protection for pharmaceutical
products in 2008. According to IPR lawyers, some government
officials, particularly in the Superior Council for Public Health
(CSSP), still do not fully understand the difference between data
exclusivity and general patent protection. El Salvador implemented
data protection for agricultural chemical products in 2009, its
last outstanding CAFTA-DR IPR obligation.

ENFORCEMENT

-------------------

4. (U) El Salvador continued the stronger enforcement efforts
started in 2008 through 2009. Salvadoran police arrested 152
people on IPR-related charges. The Attorney General's office
investigated 163 IPR-related cases, 115 of which were initiated
ex-officio.

5. (U) Optical media piracy remains a major concern. Police
confiscated 914,468 units of optical media, not including software,
in 2009 (compared to 938,311 in 2008) and shut down 19 laboratories
(compared to 20 in 2008), arresting 26 and seizing 759 disc
burners. The Attorney General's office opened 128 cases related
to music or movie piracy.

6. (U) Police seized 24,126 units of counterfeit medicine and 4,757
units of counterfeit vitamins. Police likewise seized 183 pairs of
shoes and 11,048 counterfeit clothing items, primarily Lacoste
brand, which the police say are made in neighboring Guatemala.

7 (SBU) According to Karla Ponce, the main IPR attorney in the
Attorney General's Office, her office has seen an increased number
of cases withdrawn in the past year after one industry's
complainant was reportedly threatened with violent reprisal,
including death threats.

8. (U) The judiciary continues to be the weak link in criminal IPR
enforcement, with lack of knowledge about IPR issues and laws and
inconsistent enforcement. According to the American Chamber of
Commerce's (AMCHAM) IPR committee, the Supreme Court has promised
to set up a special "IPR court" with trained judges. The 2010
budget request for the judiciary, however, did not include the
necessary funding.

BUSINESS VIEWS

---------------------

9. (U) AMCHAM's Executive Director Carmen Aida Munoz and IPR
Committee Chair Carlos Castillo view IPR as "one of the bright
spots" with the current government. Even though most personnel had
changed, they said cooperation remained excellent between the
private sector and the police. The Attorney General's office was
also responsive, though they expressed concern about reduced
staffing and the ability of the attorneys to handle the workload.
While they recognized the GOES's other serious crime problems like
murder and extortion had priority, they nevertheless lamented the
lack of resources devoted to IPR.

10. (SBU) Munoz (protect) told Econoff that PhRMA's Special 301
positions were widely discussed during a January Association of
American Chambers of Commerce in Latin America (AACCLA) meeting.
Several companies, she said, had unsuccessfully pushed to drop El
Salvador from PhRMA's recommended list. The real reason for
PhRMA's continued inclusion of El Salvador, she added, was the lack
of any action against Laboratorios Lopez, the local pharmaceutical
manufacturer allegedly responsible for most of the piracy of US
drugs. (NOTE: Laboratorios Lopez is owned by a former member of
COENA, the executive committee of the center-right ARENA party, who
maintained very close ties to the previous ARENA governments. END
NOTE.)

11. (U) The Salvadoran Radio Broadcasters Association (ASDER)
agreed to a first-ever deal with rights holder representatives to
pay royalties for music broadcasts on the radio. ASDER says it has
paid over $50,000 so far to the rights holders.

COMMENT AND RECOMMENDATION

---------------------------------------------

12. (U) El Salvador has continued with reforms to comply with
CAFTA-DR and other IPR commitments, including implementing data
protection for agricultural chemicals in the last year.
Enforcement actions are comparable to 2008, despite a significant
increase in other crime, such as murder and extortion, which have
diverted some resources away from IPR enforcement. Given the
continued commitment of the Government of El Salvador to IPR
protection, Post recommends against including El Salvador in the
2010 Special 301 Watch List.
BLAU

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