YEAR 2006 SPECIAL 301 REVIEW: JORDAN

C O N F I D E N T I A L AMMAN 001305

SIPDIS

NOFORN
SIPDIS

STATE FOR EB/IPE - C. LACROSSE
STATE PLEASE PASS TO USTR - J. CHOE-GROVES
DEPARTMENT OF COMMERCE - J. BOGER
DOC PLEASE PASS TO USPTO - J. URBAN AND LOC - S. TEPP

E.O. 12958: DECL: 02/22/2016
TAGS: ETRD KIPR ECON KTIA PGOV JO
SUBJECT: YEAR 2006 SPECIAL 301 REVIEW: JORDAN

REF: A. AMMAN 1199

B. JORDAN COUNTRY SUBMISSION (2/13/06)

C. AMMAN 1019

D. STATE 14937

E. 05 AMMAN 9748

F. 05 AMMAN 9708

G. 05 AMMAN 8330

Classified By: AMBASSADOR DAVID HALE FOR REASONS 1.4 (B, D)

SENSITIVE BUT UNCLASSIFIED SECTIONS OF THIS REPORT ARE FOR
USG USE ONLY - DELIBERATIVE MATERIAL.


1. (C) SUMMARY: Jordan's leadership has endorsed a vision of
intellectual property rights that remains one of the
strongest in the Arab world, best captured by Microsoft
Corporation's commitment to doing business here. The
Government of Jordan (GoJ) is no less committed to IPR
protection today, even as the global economy poses new
challenges to its trade regime, creates booming free trade
zones, and attracts a flood of goods as imports and in the
transit trade. Managing IPR protections in this environment
has come more easily to some GoJ ministries and agencies than
others. For example, the Ministry of Industry and Trade
(MOIT) has a well-conceived plan for patent and trademark
protections implementation. The Jordan Food and Drug
Administration, on the other hand, does not embrace an IPR
concept like "data exclusivity" as a primary mission and, to
date, has been slow to learn and act (Refs C, E). Post
reports below on the JFDA case, especially as it relates to
PhRMA's submission on Jordan to the Special 301 Review
committee. As reported previously (Refs A, F, G),the GoJ
has the political will to tackle most IPR issues and is
addressing most shortcomings with seriousness, a collective
will, and proposed plans for action (Ref A).


2. (SBU/NOFORN) SUMMARY CONTINUED: In the area of
pharmaceutical IPR protections, however, unless events over
the weeks ahead witness a significant turnaround, Jordan is
not currently providing adequate and effective protection for
intellectual property rights and may be denying fair and
equitable market access to IP holders. For these reasons,
post recommends Jordan for Watch List status in the Special
301 Review, pending resolute and immediate GoJ actions to
reverse the current circumstances. END SUMMARY.

The PhRMA Submission on IPR
--------------


3. (C/NF) PhRMA member companies on the ground have made
clear their manifest problems that stem largely from a
non-transparent regulator - the JFDA - that provides no clear
guidance regarding its actions. To date, the regulator seems
content with the prospect that generic companies should have
access to originator-company drugs as soon as possible, and
that any obligation to "protect" data exclusivity should come
from outside the regulatory framework, e.g. court decisions
(Ref E). Generic companies are represented in the JFDA's
decision-making process, which to date has produced these
unclear decisions. COMMENT: The likely motivation for the
JFDA's stance is to keep drug costs for the average Jordanian
low. Additionally, the JFDA has trouble keeping an
arms-length relationship with its domestic (overwhelmingly
generics) pharmaceutical industry. The JFDA has been accused
by some in PhRMA of engaging in stall tactics; this may be an
uncharitable assessment of a young organization. Given that
some of these unresolved issues go back to 2003, at the very
least chronic indecision has plagued what amounts to an
ungovernable bureaucracy in the JFDA. END COMMENT.


4. (SBU) Clear, precise regulations and instructions on the
issues raised by PhRMA are required.


5. (C/NF) The JFDA continues to engage PhRMA members on
their issues, but it is difficult to discern the intent --
after hearing of PhRMA's Special 301 submission, the JFDA DG
reportedly told one local PhRMA member (protect) that there
was no further reason to engage in dialogue. COMMENT: In our
view, local PhRMA companies are at times overwhelmed by their
regulator. We believe a digital video conference between the
JFDA and the USTR, to be held on February 27, will help clear
the air and set the regulator back on track to a more
positive dialogue. END COMMENT.


6. (SBU) The issues in play need to be removed from the
realm of the regulator-and-regulated, and discussed at a
higher plane in which the USG emphasizes that these are trade
commitments having binding legal force, since the FTA and
annexes were published as law in Jordan's Official Gazette on
July 16, 2001. The GoJ also needs clarity on USG definitions
and emphases arising from the Free Trade Agreement. A first
effort represented by a non-paper from USTR delivered to the
GoJ on February 12 (Ref C) is a start in this direction.

Market Access
--------------


7. (SBU/NF) PhRMA's complaint about the JFDA's
pharmacovigilance rules is beyond the realm of mere trade.
While it is potentially a technical barrier, prevailing
practices regarding drug safety cannot be taken lightly, so
long as they are uniformly applied. The JFDA has noted to
the embassy that PhRMA applicants can start a drug
registration file prior to the drug's approval and release,
and that the pharmacovigilance can commence at the time of
initial application. As a result, the actual time "lost" on
the market would then be less than a year and could be as
little as six months. Post notes that Jordan supports the
growing domestic clinical research organizations (CRO's) that
conduct modern, statistically relevant clinical trials to
determine drug safety and efficacy; the GoJ's questioning
their relevance and/or accuracy is not consistent with this
approach. The net public health effect resulting from the
delay cannot be very significant.

Price Controls
--------------


8. (SBU) Jordan's drug price controls are inconsistent with
the Free Trade Agreement's singular purpose to liberalize
trade and open markets. At the very least, the changing and
inconsistent pricing rules applied by the JFDA need to be
amended into one set of consistent, understandable criteria.


Possible Actions
--------------


9. (C/NF) A critical issue is whether the Government of
Jordan has the requisite political will to accomplish the
tasks necessary to meet FTA commitments in this area.
Instructions in Ref (D) inquire if any "possible actions"
undertaken by Jordan to redress inadequacies could be
completed prior to completion of the Special 301 review (on
or about April 30). In theory, such actions could be
completed - the cabinet would approve new regulations, and
follow-on instructions could be approved to meet the
regulations. The JFDA's history, however, does not exemplify
rapid action, especially when the continued existence of
"gray areas" in the rules of the game benefit a powerful
domestic industry.


10. (SBU) It would appear that at least one regulation on
"new uses" is nearer to being implemented, according to the
GoJ submission to the USTR (Ref B, submitted via email).
Post will take a wait-and-see attitude regarding possible
comprehensive redress by the GoJ of the problems outlined by
PhRMA, and would recommend being direct and unflinching in
pressing for immediate action before the Special 301 review
is completed.

Ongoing Areas of Review
--------------


11. (SBU) Setting aside the PhRMA case, despite some gaps in
both the legal-regulatory framework and in the government
inter-agency mission definitions (Refs A, F, G),Jordan is
generally committed to adequate and effective protection for
intellectual property rights. Following is our overall
assessment of specific areas of concern:

A) Optical Media Piracy (CDs, VCDs, DVDs)

Most of the pirated optical media in Jordan still appear to
enter from neighboring states or from overseas. (The
Embassy's assessment is based on anecdotal information,
confirmed by knowledgeable observers). There are no large
factories producing optical disks in Jordan, according to the
president of the Jordan Intellectual Property Association.
However, there are more frequent reports of "mom-and-pop"
operations burning copies of good-quality masters.
Enforcement officials report they are attempting to identify
and interdict the sources of these masters by observing the
distribution process. Unlike last fall, when different
stake-holders had differing views on optical media piracy,
the GoJ is now coming to a more cohesive view of the problem.
Solutions should be implemented as early as June. Other
solutions such as stronger ex officio border measures are
actively being considered and should be in place by the end
of the year. NOTE: These measures will require the passage
of amendments to existing laws, which explains the additional
time required. END NOTE.


B) Use/Procurement of Government Software

Since the publication of a government directive in 2004 to
address an already dwindling problem, Embassy has received
fewer reports of improper use of software in government
offices.


C) TRIPS, FTA Implementation, other IP-Related Issues

A comprehensive study of the GOJ's IPR compliance, completed
in January by the USAID Achievement in Market Friendly
Initiatives and Results (AMIR) program (delivered to
Washington agencies on February 1, Ref A),presented a
thorough analysis of the GoJ's implementation of its various
international IPR protection obligations. Gaps have been
identified, and two committees - in the Ministry of Industry
and Trade (MOIT) and in the Ministry of Culture-controlled
National Library - are considering next steps. AMIR is
working with the GoJ agencies concerned, and has already
begun to circulate a rough draft plan of action. Recommended
amendments to patent and trademark legislation are already in
train.

Post is not aware of any legislation or regulations related
to domestic protection of traditional knowledge or
expressions of folklore, or addressing issues related to
genetic resources and access and benefit sharing.

Efforts on data protection are discussed in Refs (C, E) and
in paragraphs 2-6 of this message (see above).

Interagency efforts against counterfeited goods (virtually
all imported) are being implemented and/or monitored through
the MOIT's IPR committee. Jordanian Customs continues to
interdict counterfeits at the borders, with generally good
results. Anecdotal evidence indicates counterfeit goods
continue to appear on store shelves. Proliferating free
zones have presented unique law enforcement challenges to
anti-counterfeiting efforts, and some modest low-level
corruption is occasionally reported. Embassy has witnessed
good private-public partnership in this area - significant
cases are brought to justice. Enhancement of the ex officio
border measures (see para 11A, above) will be critical. A
consensus has emerged to give the Jordan Institute of
Standards and Metrology (JISM) a stronger role at the border
to detect and intercept counterfeits.


D) Enforcement

As reported (Ref A),enforcement efforts are hampered on
several fronts, but the stake-holders over the past three
months have come to a better understanding of the challenges,
and appear genuinely committed to bringing enforcement to a
new level of effectiveness in Jordan.

Treaties
--------------


12. (SBU) While Jordan has ratified the WIPO treaties and
the GoJ has held workshops on their implementation, post
believes the GoJ National Library must now publish
regulations and or instructions to facilitate their fullest
implementation (Ref A). The AMIR program is engaged in
discussions with the National Library on drafting such a
regulatory framework. Other steps to fill gaps in
international obligations are being taken, as outlined in
paragraph 11C, above.

At all levels of the Jordanian government, post has made
known its serious commitment to the fullest possible
enforcement of FTA obligations related to IPR protections.

Training
--------------

13. (U) The USAID AMIR program continues to be the key
provider of training to Jordan's IPR policy-makers and
enforcers. Over the past year up until the present, AMIR has
supported 25 IPR-related events including scores of GoJ
officials. Topics have covered IPR awareness, advocacy,
enforcement and related IPR intelligence vetting.

AMIR has committed to sponsoring 15 Jordanian participants at
8 USPTO IPR training programs in the U.S. and four other
officials at WIPO, ASTM and other conferences in the U.S.

Post has also reached out to USPTO to secure some additional
support for training slots at regional IPR training exercises
for Jordanian Judges (Dubai) and prosecutors (Oman). USPTO
has been a valuable resource in these efforts.

USAID's democracy and governance program is attempting to
work with the GoJ Judicial Council to build more judicial
training related to IPR. A new judicial training program of
the DOC's Commercial Law and Development Program is also
slated to have an IPR component.


14. (SBU/NF) One limitation to post's IPR-related programs
are MEPI restrictions on funding - Jordan is often among the
countries not/not able to receive MEPI funding for USPTO and
other IPR programs. With the exclusion of highly specialized
pharmaceutical problems, we believe that Jordan holds
importance as a one of the region's solid performers,
especially with its growing internal commitment to moving to
a new level of IPR legal-regulatory controls and enforcement.
Some sort of informal match of funds to post expenditures
from the MEPI program could help support this effort to
achieve regional IPR goals sooner.

Post is exploring a visit by Library of Congress (LOC)
personnel and, if a first visit proves successful, would
appreciate follow-on funding for more programming bringing
LOC visitors here or sending GoJ officials to the Library.

Finally, the GoJ National Library and other enforcement
personnel could benefit from the TDY seconding of an IPR law
enforcement official from the U.S. who would work behind the
scenes to increase IPR enforcement capacity.
HALE