JUNE 2007 PRE-CANCUN IPR UPDATE

UNCLAS SECTION 01 OF 02 MEXICO 003297 SIPDIS SENSITIVE SIPDIS STATE FOR WHA/MEX/ROTH AND EB/TPP/MTA/IPC/WALLACE STATE PASS USTR FOR EISSENSTAT/ESPINEL/MELLE/SHIGETOMI/BAE/MCCOY STATE PASS COPYRIGHT OFFICE COMMERCE FOR ITA/JACOBS/WORD/WILSON/WRIGHT/ISRAEL COMMERCE PASS USPTO JUSTICE FOR CCIPS/MERRIAM/KOUAME/GARLAND DHS FOR CBP/RANDAZZO AND ICE/JLOZANO E.O. 12958: N/A TAGS: KIPR PINS ECON ETRD MX CH SUBJECT: JUNE 2007 PRE-CANCUN IPR UPDATE REF: (A) MEXICO 1678 (B) MEXICO 2219 (C) MEXICO 3266 (D) MEXICO 2852 SUMMARY -------------- ¶1. (SBU) President Calderon's National Development Plan included a paragraph on the importance of IPR protection. Calderon had IPR talking points for his meeting with Chinese President Hu Jintao at the G-8, but told the press he didn't have time to raise the issue. The Chairman of the lower house Justice Committee said proposed amendments to make IPR infringement a serious crime subject to ex-officio police action were important, but he would not proffer an assessment of its chance of passage in September. The movie and textile industries report they have been working well on anti-piracy initiatives with State of Mexico officials. GOM officials and music and movie reps requested USG help in stopping the entry of contraband blank discs into Mexico. The Attorney General's Office (PGR) is ready to launch its IPR website, and says it will focus on arrests and jail time more than confiscations this year. The American Chamber of Commerce launched its IPR Committee. The Embassy is working with Mexican Customs to arrange an IPR training course in Veracruz later in the summer. End summary. ¶2. (U) President Calderon publicly unveiled May 31 the National Development Plan that is supposed to guide his administration's work over the course of its six-year term. The Plan is divided into five main themes, the first of which is ensuring the rule of law and security. One of the strategies under this heading is "protection of intellectual property." The Plan describes the negative impact of piracy on innovation and entrepreneurs and declares that national laws and international obligations will be enforced in Mexico, in particular by seizing merchandise and taking preventive actions at the border to prevent the entry of infringing goods. ¶3. (U) Calderon met with PRC President Hu Jintao June 7 on the margins of the G-8 meetings held in Germany. After the meeting, Calderon told reporters that he had intended to raise Chinese infringement of Mexican intellectual property rights but did not have time to raise the issue, due to the intense focus at the G-8 meetings on climate change, global imbalances, and financial market stability. The day before the meeting, Jorge Amigo, the head of the Mexican Institute of Industrial Property (roughly equivalent to the U.S. Patent and trademark Office) had made headlines in Mexico by claiming that famous Mexican brands like Corona beer are routinely ripped off by Chinese counterfeiters. ¶4. (SBU) Chairman of the Chamber of Deputies' Justice Commission Cesar Camacho told econoffs at a meeting on June 8 that he was well aware that the Senate had recently passed amendments to federal copyright and industrial laws, as well as the criminal code (ref B),that would make IPR infringement a serious crime subject to ex-officio law enforcement, as opposed to the current system under which police authorities must first receive a formal complaint from rightsholders before launching an investigation into an alleged case of copyright piracy or trademark counterfeiting. Camacho said many deputies had not yet had time to review the bill, let alone consider possible amendments. He agreed that it was an important issue, but would not guarantee that it would be voted on in September nor would he be drawn out on its chance of being passed unmodified by the Chamber of Deputies. Camacho was unaware of a bill proposed (but not acted on) in the previous Congress on implementing WIPO Internet treaty obligations, but invited econoffs to be in touch with his staff regarding both that issue and the ex-officio amendments. ¶5. (U) At a bi-national meeting of the U.S. and Mexican film industries (ref C) and the monthly public-private meeting of the Inter-institutional Committee for the Protection of IPR chaired by the Office of the Attorney General (PGR), MEXICO 00003297 002 OF 002 representatives of the Motion Picture Association and Mexican textile and apparel makers commented positively on the first cooperative steps taken under the agreement that the State of Mexico had entered into with a private sector coalition to combat piracy and counterfeiting in Mexico's most populous state. Though state law enforcement officials do not have authority to pursue IPR cases (which are covered by federal laws),they can make use of consumer protection rules and the power to deny business licenses to close down vendors of illicit goods. Apparently this is what State of Mexico authorities have done in one particularly notorious market in the state capital of Toluca. Industry has subsequently been working with the government to re-populate the market with vendors of cheap but legal products. The private sector has signed an agreement with the municipality of Toluca and is close to signing an agreement with the state of Morelos (just south of Mexico City). Post plans to report on progress in the State of Mexico and Municipality of Toluca in more detail in a future telegram in the hopes that other states and municipalities follow their lead. ¶6. (SBU) Felipe Munoz, PGR Deputy Attorney General for Federal Crimes, invited econoffs to a meeting attended by IMPI, Mexican Customs, and the film and music industries regarding the illegal entry into Mexico of blank optical disc media that is then used to burn pirated copies of movies, music, and software. DVD-Rs made in Taiwan allegedly enter Long Beach in-bond for transit to Mexico and then are shipped to Tijuana and Laredo. Before crossing the border, they are fraudulently re-labeled as "made in the USA" and thus avoid paying Mexican tariffs. GOM officials requested USG assistance in cracking down on this illegal practice north of the border. Industry reps averred that by evading the payment of the appropriate Mexican tariffs, the pirate end-users of these discs reap a significant economic advantage over legitimate vendors. ¶7. (SBU) At a subsequent meeting with Munoz, he previewed the IPR website that PGR is poised to launch. The site contains enforcement statistics, explanations of relevant laws, how to initiate legal actions, a mailbox for suggestions and leads, and links to a number of other relevant sites, including IPR-related USG websites. At this meeting, Munoz assured econoffs that PGR would focus more on arrests, convictions and jail time than seizures. ¶8. (U) The American Chamber of Commerce launched its IPR Committee on June 4. A mix of U.S. manufacturing, pharmaceutical, software, film, and sports goods companies participated in the first meeting, as did the President of the AmCham, who promised full support for the Committee's activities, and the head of IMPI's IPR protection division, Gilda Gonzalez. The Committee agreed to form separate working groups on: measuring the level of infringement in Mexico; training Mexican officials; and public awareness. ¶9. (SBU) Econoffs are working with DOJ, CBP, and ICE to organize a training for Mexican customs officials at the major eastern seaport of Veracruz later this summer. In addition to customs personnel, PGR and IMPI officials as well as private sector reps would also participate. The proposed date for this training is the week of July 23-27. Visit Mexico City's Classified Web Site at http://www.state.sgov.gov/p/wha/mexicocity and the North American Partnership Blog at http://www.intelink.gov/communities/state/nap / GARZA