TURKEY: ADVANCE SPECIAL 301 INITIATIVE RESPONSE

UNCLAS SECTION 01 OF 03 ANKARA 000128 SIPDIS EB/TPP/IPE FOR JBOGER PLEASE PASS USTR FOR JCHOE-GROVES AND LERRION USPTO FOR JURBAN USDOC FOR ITA/MAC/CRUSNAK SENSITIVE SIPDIS E.O.12958: N/A TAGS: ECON ETRD KIPR PGOV TU SUBJECT: TURKEY: ADVANCE SPECIAL 301 INITIATIVE RESPONSE Ref: A) 06 STATE 183957 B) 06 STATE 180082 ANKARA 00000128 001.2 OF 003 ¶1. (U) Turkish officials welcomed the opportunity to work with us on intellectual property issues in advance of the regular "Special 301" season. We coordinated with several Turkish government agencies, including the Foreign Trade Undersecretariat (FTU),which is responsible for ensuring that Turkey is upholding its international obligations, such as IP protection obligations. FTU and the Ministry of Justice (MOJ) provided extensive written responses to the questions raised in reftels. We also met separately with FTU, MOJ, Customs Undersecretariat, and Patent Institute and received information from the Turkish National Police and the Turkish chapter of the Business Software Alliance and member companies. Finally, Ambassador plans to meet with State Minister for Foreign Trade and Customs, Kursad Tuzmen, in the near future to discuss these issues with him and encourage his involvement during the "Speial 301" process this year. ¶2. (SBU) In its coordinated written submission, FTU noted a number of improvements during 2006 related to Turkey's IP protection. A summary of the response to ref A follows: -- In response to the question of pharmaceutical data-exclusivity, the Ministry of Health (MOH) stated that its review of the generics applications received prior to January 1, 2005, is ongoing. FTU noted that only one case has been approved thus far (for a copy of one of Danish firm Lundbeck's products),and added that during meetings with PhRMA company representatives in Turkey, the companies conceded that the claim for data protection of the molecule was questionable. -- Regarding patent linkage, FTU argued that Turkey's system is similar to that of the EU and several other countries and that implementing a system similar to that of the U.S. is not an international obligation. It also pointed to the Turkish Patent Institute's (TPI) recently implemented computerized database, which is accessible by the public through their website, and the regular reports sent by TPI to MOH listing recently approved pharmaceutical patents. They added that there has not been a case since that of Eli Lilly's where a generic of a product with a valid patent in Turkey was granted marketing approval. -- The Ministries of Justice, Culture and Tourism, the Customs Undersecretariat and the Turkish National Police have continued their combined campaign against pirated goods, and the MOJ provided updated statistics on seizures. In addition, they described efforts to disseminate computerized information about counterfeit books to law enforcement, prosecutors and judges in real-time. -- According to Turkey's chapter of the Business Software Alliance (BSA) the situation has improved since the governmental decree calling for the use of licensed software in all government agencies. While anecdotally, government use of pirated software is still high, BSA representatives and member companies in Turkey believe that the government is acting in good faith to improve the situation. BSA is also working with the Ministry of Culture and Tourism to implement public awareness campaigns. -- Finally, the Ministry of Justice allocated additional resources in 2006 to help alleviate the backlog of IPR cases and more efficiently prosecute offenders. The number of specialized IPR courts increased to 12, including two additional courts in Istanbul. In addition, judges, prosecutors and law enforcement officials continue to participate in GOT, EU, and U.S. training programs. ¶3. (U) More detailed responses to the questions raised in ref A are listed below to correspond with the original talking points: ¶4. (U) "Continue the process of reviewing all applications for marketing approval submitted prior to 01.01.05, and ensure that no approvals are granted for molecules under patent protection." (SBU) In FTU's written submission, it noted that data exclusivity for pharmaceutical products is a commitment for Turkey in accordance with its EU Association Agreement. Regulations on this issue have been prepared in accordance with the EU requirements. Turkey introduced data exclusivity for pharmaceutical products on Most Favored Nation basis to all of its trading partners. Therefore, data exclusivity is not limited to original products licensed in EU member countries. Acquiring a license in any country after January 1, 2001, is sufficient for data exclusivity if no generic manufacturer had applied for licenses in Turkey as of January 1, ¶2005. The term of exclusivity is limited to the duration of the drug patent or to six years after the date of licensing, which is ANKARA 00000128 002.2 OF 003 the same system used by the EU. (SBU) Concerning the outstanding generic applications that were submitted prior to January 1, 2005, MOH stated that these applications are still being examined. However, FTU added that this does not necessarily mean that licenses will be issued for all of the applicants. Applications that do not meet the necessary criteria will be rejected. FTU added that to date, only one such application has been approved (for a copy of one of Danish firm Lundbeck's product),and that the pharmaceutical companies conceded in meetings with FTU that the product that was approved was not necessarily an exact copy of Lundbeck's protected molecule. ¶5. (U) "Implement a system of coordination between health and patent authorities to prevent the issuance of marketing approvals for authorized patent-infringing copies of pharmaceutical products." (SBU) FTU asserted that Turkey utilizes a system similar to the EU's in which a firm applying for licensing of a product must prove that the new product has not been licensed nor has been patented in Turkey. For example, a generics manufacturer would have to include information in its application showing that the product has not been patented in Turkey. In 2006, the Turkish Patent Institute (TPI) created a searchable database website that permits users to search for patented, copyrighted, and trademarked material in Turkey. The TPI also sends regular reports to the MOH about recently-approved health-related patents (including pharmaceuticals),the last of which was sent in November 2006. Between reports, MOH officials can search the patent database. The TPI does not, however, provide information to outsiders about patent applications that have not yet been approved. FTU added that since the highly publicized case in which copies of Eli Lilly's product Zyprexa were granted licenses while it had a valid patent, there have been no subsequent cases of this type in Turkey. ¶6. (U) "Continue the campaign against book piracy and provide statistical readouts of success." (SBU) The MOJ provided the following statistics on seizures resulting from operations against IPR violators conducted between 1 April 2004 and 7 December 2006: 2004 2005 2006 -------------- -------------- -------------- # of Ops 2,844 3,442 3,562 # Prosecuted 3,824 3,611 4,712 SEIZED MATERIALS Unreg. CD/VCDs 2,020,370 2,893,357 4,133,385 Unreg. DVDs 59,346 316,954 401,611 Unreg. Books 274,527 240,335 156,914 Unreg. Video Cass. 675 128 1,512 Unreg. Tape Cass. 55,202 45,590 69,987 Reg. CD/VCDs 4,649 659 1,201 Reg. DVDs - 419 520 Reg. Books 3,783 1,480 1,840 Reg. Tape Cass. 3,623 3,489 3,582 TOTAL SEIZURES 2,422,175 3,502,411 4,770,552 (SBU) In addition to seizures, in May 2006, a web-based banderole automation system was established in order to provide judges, prosecutors, security forces, business associations and copyright holders with real-time information regarding pirated goods. (SBU) Plans for the future include an Optical Disk Investigation Center which, based on the model of IFPI laboratories, will provide law enforcement with the ability to quickly identify counterfeit material. The MOJ also plans to establish IPR offices in each of the provinces and to provide additional training to raise the awareness of the police and officials responsible for fighting piracy in the provinces. As additional encouragement, a draft bill was sent to Parliament providing bonus compensation for law enforcement officials who seize pirated goods. It has been approved by the relevant Parliamentary Sub-Committee and will be submitted for approval by the General Assembly. ¶7. (U) "Provide feedback on the success of the governmental decree mandating the use of licensed software in governmental agencies. Address rampant business software piracy in the private sector and by individuals by initiating enforcement actions and public awareness campaigns." (SBU) The Ministry of Culture and Tourism created a public awareness campaign in cooperation with Turkey's chapter of the Business Software Alliance (BSA) that includes newspaper and TV advertisements explaining the illegality and penalties associated ANKARA 00000128 003.2 OF 003 with using pirated software and showing the logo of the MOCT and BSA. (SBU) As noted in ref A points, the GOT requires that all software used on government computers be licensed. However, Turkey's chapter of BSA has heard anecdotally that the estimated piracy rate on government computers is approximately 50 percent. They emphasized to us, however, that they believe that the government is acting in good faith and trying to eliminate pirated software use by government officials. Comment: The head of the Turkey office of a major U.S. software producer told us that he doubts the utility of such proclamations in relatively more-developed countries like Turkey and agreed that the Government is working to reduce internal piracy. He also said that an agreement had more symbolic than practical value, given that there is no centralized point for government software procurement. In 2006, Microsoft CEO Bill Gates visited Turkey and announced his plans to support a techno-park in Istanbul and invest more in Turkey, which he characterized as a regional technological base. Microsoft and other companies, like Cisco, have close cooperative relationships with the government of Turkey. End comment. ¶8. (U) "Provide the judiciary with more resources to increase efficiencies (process cases more quickly) and take concrete steps (e.g., sentencing guidelines) to encourage judges to impose deterrent sentencing." (SBU) The Ministry of Justice (MOJ) recently increased the number of IPR courts in Turkey to 12, seven of which are civil courts and five of which are criminal. This increase added two additional IPR courts in Istanbul to reduce the backlog. The MOJ is also working on creating additional courts in Istanbul to further increase efficiencies and to locate additional warehouses in which seized goods can be stored while the trial is proceeding. (SBU) The MOJ, in cooperation with the EU, has provided a number of training seminars for judges, prosecutors and law enforcement officials. For example, 8 IPR judges and prosecutors participated in a 10 month training program in the EU IPR-related agencies. In addition, an IPR Documentation Center was established at the University of Ankara Faculty of Law. This Center provides centralized information related to IPR international law and best practices. The MOJ has also developed a computerized network that links the IPR Courts, the Documentation Center, the MOJ, the TPI and the Customs Administration. We also continue to send Turkey's IPR judges on IV programs to the U.S. (SBU) The following MOJ information shows the average duration of IPR cases: TYPE OF CRIME DURATION W/O DURATION W/ APPEAL APPEAL -------------- -------------- -------------- Trademark 3 - 7 months 2 years Patent 3 - 10 months 2 years Utility Model 2 - 10 months 2 years Copyright: Moral rights 3 - 10 months 2 years Financial rights 3 - 8 months 2 years Other offences 3 - 10 months 2 years Related rights 3 - 8 months 2 years Banderole crimes 3 - 6 months 2 years Seizure 1 - 2 days WILSON