DOMINICAN REPUBLIC YEAR 2005 SPECIAL 301 REVIEW:

UNCLAS SECTION 01 OF 02 SANTO DOMINGO 000970

SIPDIS

USDOC PASS USPTO; STATE FOR EB - WILSON, ADAMO; WHITE HOUSE
PASS USTR FOR MALITO, PECK, SOUDER, VARGO

E.O. 12958: N/A
TAGS: KIPR ETRD EINV DR
SUBJECT: DOMINICAN REPUBLIC YEAR 2005 SPECIAL 301 REVIEW:
EMBASSY INPUT

REF: SECSTATE 24592


1. (SBU) Summary. Embassy recommends maintaining the
Dominican Republic on the Special 301 Watchlist. IPR
infringement problems remain at levels similar to those of
last year, with some call for optimism in the area of
television broadcast piracy, a long-term problem. A
broadcast piracy court case filed in 2003 against a large
television station was finally decided in November with a
ruling against the station. A CAFTA-required report on
broadcast piracy due in October was provided, albeit late.
The Ministry of Industry and Commerce has now assumed
responsibility for the quarterly report and assured the
Embassy that it will be on time and complete in the future.
Pharmaceutical counterfeiting continues. Dominican
pharmaceutical manufacturers were unsuccessful in requests to
the national congress to reduce penalties for infringement of
patents and trademarks but they continue to lobby. End
Summary.


2. (SBU) While the Dominican Republic has strong legislation
to protect copyrights and has improved the regulatory
framework for patent protection, United States industry
representatives continue to cite lack of IPR enforcement as a
major concern. The government has taken some steps to
prosecute violators, but it has provided insufficient
training and resources for enforcement. The judicial process
moves slowly. While the Dominican Republic has ratified the
WIPO Copyright Treaty and the WIPO Performances and
Phonograms Treaty, as of this writing, it has not deposited
instruments of ratification for these two treaties with WIPO.


3. (U) Obligations under the free trade agreement (CAFTA)
signed on August 5, 2004, would require strengthening the
Dominican IPR protection regime. Not yet ratified either by
the United States or the Dominican Republic, the CAFTA
requires measures to criminalize end-user piracy, providing a
stronger deterrent against piracy and counterfeiting. The
CAFTA will require the Dominican Republic to authorize the
seizure, forfeiture, and destruction of counterfeit and
pirated goods and the equipment used to produce them. The
CAFTA text also mandates both statutory and actual damages
for copyright infringement and trademark piracy. This will
serve as a deterrent against piracy, and will ensure that
monetary damages can be awarded even when it is difficult to
assign a monetary value to the violation.

Television Broadcast Piracy
--------------

4. (SBU) Dominican trade negotiations with the United States
on inclusion in the CAFTA included an agreement by exchange
of letters signed by the Secretary of Industry and Commerce
confirming that the Dominican Republic will "take all
necessary steps to halt television broadcasting piracy by
licensed broadcasting stations and to provide a deterrent to
future infringements." The agreement committed the
Dominicans to provide the United States with a quarterly
written report describing progress in stopping television
broadcasting piracy, including criminal, administrative and
civil investigations and actions taken. The due date for the
first report was October 5, sixty days after CAFTA was
signed. In December, the National Copyright Office (ONDA)
provided the U.S. Embassy a copy of a late internal report
that failed to address the broadcast piracy issue. The
Ministry of Industry and Commerce submitted a report to the
Embassy February l, including mention of the fact that in
November the Santo Domingo District Attorney's Office
obtained a court order to monitor and document broadcasts by
Telemicro and Canal del Sol, two large-scale offenders. The
information collected from monitoring should be of use in
future prosecutions.


5. (SBU) An important item not mentioned in the Industry and
Commerce report is the October 22, 2004, court decision
against Channel 5/Telemicro for broadcast piracy. The court
ordered Telemicro to pay a total of RD Pesos 415,000 (about
US$14,000) to Twentieth Century Fox, Tristar Pictures,
Columbia Pictures and Warner Brothers. The court sentenced
Telemicro,s manager to three months in prison. The judge
did not suspend the station's operations. MPAA,s attorney,
who helped prosecute the Telemicro case, will soon file a new
similar case against Telemicro and two other Dominican
stations. The positive 2004 outcome against Telemicro gives
some indication that the next case against illegal
broadcasters may also be successful.

Patents, Trademarks and Pharmaceuticals
--------------

6. (SBU) From mid-2004, the United States Government
repeatedly expressed its concern about draft legislation
advocated by domestic pharmaceutical manufacturers seeking to
lower fines sharply and to eliminate prison penalties for
infringement of both patents and trademarks. The leadership
of the House of Representatives resisted pressure and
consulted with the Embassy on the contents of the draft. In
early 2005, a local patent attorney provided the Embassy with
a copy of modified draft legislation not yet submitted to
Congress. The new draft legislation is marginally better in
that it allows for prison penalties in the case of trademark
violations. No prison sentences would be specified for
patent violators, however, and they might avoid the prospect
of appearing in court on criminal charges. This is because a
new criminal procedures code enacted in 2004 provides that in
cases of a crime for which no prison sentence is specified by
statute, the accused can pay a fine in advance to avoid
appearing in court. The draft legislation does not address
the question of civil actions against patent violators.

WIPO Treaties and Other Issues
--------------

7. (U) The United States government has continued to urge the
Dominican Republic to bring the Industrial Property Law fully
in line with its TRIPS Agreement obligations. Existing law
and regulations have not yet been applied in legal
proceedings, so the effectiveness of those measures has not
been tested. The CAFTA commitments will require that test
data and trade secrets submitted to the Dominican government
for the purpose of product approval be protected against
unfair commercial use for a period of five years for
pharmaceuticals and ten years for agricultural chemicals.


8. (U) Optical Media Piracy: ONDA reported that between
October and January it confiscated about 100,000 pirated
versions of copyright protected works, the majority music CDs
(83,117) and DVD movies (7,351).


9. (U) Government Use/Procurement of Software: ONDA has no
program to monitor government use of software, although CAFTA
commitments will require that such monitoring take place.

Summary and Recommendation
--------------

10. (SBU) The Dominican Republic has not shown significant
improvements in IPR protection during the past year, but the
situation has not deteriorated. The positive decision in the
October broadcast piracy case against television station
Telemicro is noteworthy because it suggests that Dominican
broadcasters are not completely immune to prosecution, as
they once appeared to be. The President has repeatedly
stated publicly that ratification of CAFTA is a priority;
ratification will formally strengthen the commitment of the
government to protect intellectual property. We recommend
maintaining the Dominican Republic on the Special 301
Watchlist.
HERTELL