2003 SPECIAL 301 REVIEW: REVISED HONDURAS SUBMISSION

UNCLAS SECTION 01 OF 02 TEGUCIGALPA 000663

SIPDIS

SENSITIVE

DEPT FOR EB/IPC WILSON
DEPT PLEASE PASS TO USTR FOR ALVAREZ
DEPT PLEASE PASS TO LIBRARY OF CONGRESS, COPYRIGHT FOR TEPP
DEPT PLEASE PASS TO USPTO FOR URBAN
GENEVA PASS USTR
DOC FOR LASHLEY

E.O. 12958: N/A
TAGS: ECON ETRD HO KIPR
SUBJECT: 2003 SPECIAL 301 REVIEW: REVISED HONDURAS SUBMISSION

REF: TEGUCIGALPA 560


1. (U) Revised Sensitive But Unclassified Post submission of the
2003 Special 301 Review for Honduras follows. Addressees are
requested to replace reftel with this submission.


2. (SBU) Summary and Comment: Honduras is largely in compliance
with the Trade Related Aspects of Intellectual Property Rights
(TRIPS). There have been no additional moves in the past year by
Government of Honduras (GOH) to strengthen or weaken the
protection of Intellectual Property Rights (IPR) in 2002.
Embassy recommends that Honduras remain off the Special 301 watch
list.

OPTICAL MEDIA PIRACY
--------------


3. (U) Although Honduras has yet to experience large-scale in-
country optical pirating, it is believed that a significant
amount of pirated goods is imported from neighboring countries
and that the piracy of books, sound and video recordings, compact
discs and computer software is still widespread. Confiscation
has been erratic and usually involves minor seizures of CDs.
Success in controlling optical piracy rests on the GOH's ability
to effectively implement current laws.

USE/PROCUREMENT OF GOVERNMENT SOFTWARE
--------------


4. (U) The GOH has made progress in its protection of the use and
procurement of government software. After a meeting in 2002
between the new government and Econoff during which he reminded
them of their responsibilities, Honduras' IPR Division sent
letters to all government agencies informing them that all
government software use must comply with Honduran national law
and international agreements. Due to a lack of resources and
personnel at the IPR division, oversight and enforcement has been
limited.

TRIPS COMPLIANCE
--------------


5. (U) Honduras largely has complied with the WTO Agreement on
Trade-Related Aspects of Intellectual Property Rights (TRIPS),
through legal revisions enacted in December 1999. The Honduran
Congress still must, for instance, adopt reforms related to
integrated circuit designs and plant variety protection to be in
full compliance with TRIPS. Honduras and the U.S. initialed a
Bilateral Intellectual Property Rights (IPR) Agreement in March
1999, but substantive issues arose during the language conformity
process. Embassy expects that the current U.S.-Central America
free trade negotiations will provide a convenient forum for the
USG to push for additional IPR commitments.


6. (U) Honduras' copyright law, updated in 1999, added more than
20 different criminal offenses related to copyright infringement
and established fines and suspension of services that can be
levied against offenders. U.S. companies are concerned that
recent attempts to prosecute computer software infringement cases
have been met with inadequate support by officials in the
Ministry of Industry and Trade's IPR Division and the Attorney
General's office.


7. (U) Honduras ratified the Paris Convention for the Protection
of Industrial Property in 1994. The Honduran Congress enacted a
1999 Law of Industrial Property to provide improved protection
for both trademarks and patents. To be protected under Honduran
law, patents and trademarks must be registered with the Ministry
of Industry and Trade.


8. (U) Recent modifications to the Patent Law of 1993 include
patent protection for pharmaceuticals, and extend the term of
protection for a patent from seventeen to twenty years from the
date of filing to meet WTO standards. The term for cancellation
of a trademark for lack of use has been extended from one year to
three years. Trademarks are valid for up to 10 years from the
registration date. The illegitimate registration of well-known
trademarks has, in the past, been a persistent problem in
Honduras.


9. (U) The protection of data exclusivity by the GOH has been
raised by the pharmaceutical and pesticide companies. A U.S.
pharmaceutical company has complained that the Ministry of
Health, in approving a competing company's pharmaceutical
product, did not respect their data exclusivity rights as
guaranteed in article 77 of Honduras' Industrial Property Law and
article 39 of the WTO TRIP's agreement. The Ministry of Health
approved the competing pharmaceutical product, despite
communication from Honduras' IPR Division that the U.S. company's
research and data were protected under Honduran law. The U.S.
company argues that in order for the competing product to be
legally registered with the Ministry of Health, the company needs
to provide the research and data to support their application.
Honduran law provides five-year exclusive use of data provided in
support of registering pharmaceutical products. Further, a
regional association of pesticide companies met with Econoffs on
a number of occasions to express concern over the GOH's 5-year
data exclusivity period which from their perspective is
insufficient to justify product development and testing in
Honduras.

WORLD INTELLECTUAL PROPERTY RIGHTS ORGANIZATION
-------------- --


10. (U) Honduras became a member of the World Intellectual
Property Organization (WIPO) in 1983. Honduras has not yet
ratified the WIPO Copyright Treaty (WCT) or the WIPO Performances
and Phonogram Treaty (WPPT). The treaties were signed two years
ago and are still awaiting ratification in the National Congress.

IPR ENFORCEMENT
--------------


11. (U) The 1999 Copyright Law specifies three different avenues
in the prosecution of copyright infringement cases:
administrative, civil and criminal. After confiscating pirated
goods, the GOH can file an administrative case that may result in
a fine. However, the law requires companies whose rights have
been violated to file civil and criminal charges. Few U.S.
companies have asserted their right to file either a civil or
criminal case, leaving the resource strapped prosecutor's office
responsible for the lawsuits. As a result, few cases are tried
to the full extent of the law.


12. (U) Enforcement of the law relies largely on periodic sweeps
in the market and on investigations carried out after an
accusation has been made. The GOH Customs and Tax Authority
(DEI) is responsible for impeding the flow of illegal goods into
Honduras. IPR officials have commented in the past that police
and DEI officials lack the skills and resources to identify and
control the flow of pirated products.

Palmer