INTELLECTUAL PROPERTY WRONGS IN BOLIVIA

C O N F I D E N T I A L LA PAZ 002929 SIPDIS SIPDIS PLEASE PASS TO DOC/SUSAN WILSON AND AMANDA WILSON USTR/TANUJA GARDE AND CHRIS WILSON HHS/LOU VALDEZ AND MARK ABDOO USPTO/JON SANTAMAURO AND JIM HOUSEL AND NSC E.O. 12958: DECL: 10/26/2017 TAGS: PGOV PREL EINV KIPR PINR BL SUBJECT: INTELLECTUAL PROPERTY WRONGS IN BOLIVIA REF: A. SECSTATE 125666 ¶B. 06 LA PAZ 837 Classified By: EcoPol Counselor Mike Hammer, reasons 1.4b,d ¶1. (C) Summary: Emboffs met with officials of Bolivia's National Intellectual Property Service (SENAPI) on October 16 as part of a series of meetings with IPR stakeholders including former SENAPI head Perla Koziner. SENAPI's current director, Claudia Solares, who had worked for former-director Koziner, discussed the institution's financial difficulties, downplayed past USAID assistance while expressing interest in European and Cuban assistance, and ended the meeting by requesting more information on "flexibility" or compulsory licensing for pharmaceuticals. Meetings with IPR stakeholders emphasized the gravity of the IPR situation in Bolivia, where it is practically impossible to find non-bootlegged media, underpaid SENAPI staff are bribed as a matter of course, and IPR enforcement is basically nonexistent. Post plans to try to work with SENAPI to arrange training opportunities. End summary. - - - - - - - - - - - - - - - - - You Say You Want a Revolution... - - - - - - - - - - - - - - - - - ¶2. (C) USAID worked with SENAPI in 2004 and 2005 (during former-director Koziner's tenure) to begin the digitization of patent and copyright records. The initiative stopped when the Morales administration came in to power, partially due to distrust on the part of the new director, Claudia Solares. According to Koziner, Solares has in the past accused Koziner and other former officials at SENAPI of expropriating USAID funds for personal use, and in our meeting, Director Solares mentioned specifically that she is looking now toward Europe and Cuba for assistance (although she left the door open to the possibility of accepting help from the United States.) Although there was some staff-turnover with the entry of the new administration, according to Solares there has been no mass-firing of employees as a result of the "revolution" within SENAPI under the new Movement Toward Socialism (MAS) administration (ref b). SENAPI's focus has obviously shifted, however. Solares spent a good portion of the meeting discussing the government's plans to register 'traditional knowledge' such as popular dances and songs. When asked about more technical patents, Solares commented that they are understaffed and need to hire more examiners to help the one technical examiner they currently have. - - - - - - - - - - - - - - Low Salaries, Low Standards - - - - - - - - - - - - - - ¶3. (C) SENAPI is officially self-funding: the budget is based on estimates of fees for services, which are some of the lowest in the region. As a result, employees are chronically underpaid. Koziner provided the following estimates of salaries: the director makes roughly USD1000 monthly, while subdirectors make USD400 monthly and technicians between USD120 and USD240 per month (by comparison, mines in Bolivia are currently offering up to USD100 monthly for unskilled labor.) It is no surprise that low-level corruption is rampant: a local IPR lawyer informed us that most transactions with the technicians involve a small 'gift' of a few dollars, while special favors like back-dating a late application, correcting an error, or losing a competitor's application cost more. Koziner did not accuse Director Solares of taking bribes, saying that the directors, although not well-paid by standards within the industry, make enough to get by and use the position as a valuable addition to their resumes. Koziner did, however, say that Solares is not actually legally qualified for the position of director (lacking a master's degree in IPR law.) In fact, according to Koziner, Solares left SENAPI when Koziner was director because SENAPI management had reason to question the validity of Solares' Cuban law degree (which appeared to have a date changed on the certificate.) Solares chose to quit rather than provide proof of her degree, and she then worked for a couple of years at CIFABOL, the Bolivian generic drug association. According to Koziner, Solares was nominated as SENAPI director with sponsorship from the Cuban Embassy. (Note: Koziner said that the Cuban Embassy's original suggestion for SENAPI head, Erika Duenas, who also worked at CIFABOL opposing pharmaceutical patents, is now the economic counselor at the Bolivian Embassy in DC. End note.) - - - - - - - - - - - - - - - What You Don't Know Can Hurt - - - - - - - - - - - - - - - ¶4. (C) Whether or not Solares is actually qualified to be the director of SENAPI, she seemed to be genuinely ignorant of a number of facts in her field. She expressed surprise at the mention of a software development industry in Bolivia, and she did not know how USAID had assisted SENAPI before her arrival as director. On a number of questions, Solares deferred to a colleague at the meeting, and she seemed far more comfortable with the current political push for registration of traditional knowledge than she did with industrial property rights issues. She also asked emboffs for more information on "flexibility" or "compulsory licensing", stating that she had read about this option on the internet and asserting that the United States had experience with compulsory licensing for an avian flu vaccine. Emboff did not reply in detail, but offered to follow up. (Note: Both Koziner and locally-prominent IPR lawyer Carlos Ferreyra opined that there is little chance of Bolivia actually exploring compulsory licensing. Koziner points out that very few drugs are under patent in Bolivia and that, since fakes are widely available, actually going through the process of compulsorily licensing a drug would not be considered necessary by SENAPI. Ferreyra suggested that Bolivia is following Venezuela's lead on this issue, and that since there has been no compulsory licensing by the Venezuelan government, he does not fear it in Bolivia. End note.) - - - - - - - - - - - - - - - - - - - Good Law, Bad--or no--Implementation - - - - - - - - - - - - - - - - - - - ¶5. (C) Koziner and Ferreyra stated that the underlying IPR laws in Bolivia and Andean Community decisions are sound, but that implementation is poor and enforcement non-existent. Koziner gave the example of a client who makes a popular juice drink in tetrapak, but whose intellectual property is being infringed by a Bolivian company which sells a juice, under a similar label, as "the bottled version." According to Koziner, SENAPI does not have the expertise or experience to issue a decision on infringement, and the local judges are even less prepared. Ferreyra said that he can think of only 6 locations in La Paz where any legal audio-visual products (DVDs or CDs) are available, while Koziner could not think of any legal options. When asked about enforcement, Ferreyra stated that the police have neither interest in nor budget for IPR enforcement. Ferreyra recounted the experience of Sony, a client of his company, which tried to coordinate with the police to raid a popular black-market neighborhood in La Paz. When the police predicted violence and asked for help in funding 500 officers to "take" the market, Sony changed its plans and instead ran a locally successful education campaign, giving away genuine Sony items and popularizing their hologram as a sign of quality. - - - - - - - - - - - - Education and Training - - - - - - - - - - - - ¶6. (C) With a deeply-ingrained acceptance of IPR violation, Bolivia would probably benefit from general education on the value of IPR. Considering the background of SENAPI's current director and the state of the agency, we intend to look at ways to begin that education at the government level. Although she seems philosophically resistant to U.S. assistance on IP, Director Solares is currently feeling the pressure from her minister in response to long delays in processing (some patent applications are pending from over 6 years ago.) In our meeting, Solares seemed grudgingly open to U.S. assistance, in particular for training. Although we proposed upcoming USPTO training in the United States, few SENAPI employees speak English and Solares did not seem in favor of this option. For that reason and because there are fundamental differences between U.S. and Bolivian IP laws, Post intends to focus on local training options, including supporting a seminar with local IP lawyers and government officials and possibly offering to assist in creating an in-house training program for SENAPI (which could continue without U.S. assistance and hopefully mitigate against SENAPI's high rate of employee turnover.) Post would be interested in information about regional IP training options and available funding. Please contact Beth Mader at madere@state.gov or (591-2-216-8052). GOLDBERG