VZCZCXRO5759
PP RUEHRG
DE RUEHBR #2082/01 3051915
ZNR UUUUU ZZH
P 011915Z NOV 07
FM AMEMBASSY BRASILIA
TO RUEHC/SECSTATE WASHDC PRIORITY 0344
RUCPDOC/USDOC WASHDC
INFO RUEHRI/AMCONSUL RIO DE JANEIRO 5366
RUEHSO/AMCONSUL SAO PAULO 1110
RUEHRG/AMCONSUL RECIFE 7319

UNCLAS SECTION 01 OF 03 BRASILIA 002082 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ECON ETRD EIND EINV ENRG TSPL TBIO TPHY TRGY TNGD PGOV BR
SUBJECT:  USG-GOB COMMERCIAL DIALOGUE: CONTINUING A STRONG FORWARD 
MOMENTUM 
 
 
¶1.  Summary:  The reporting session of the third meeting of the 
U.S.-Brazil Commercial Dialogue, an hour-long event held October 10, 
2007 in Brasilia, Brazil, was a positive and productive example of 
current USG-GOB bilateral cooperation.  Visiting U.S. Secretary of 
Commerce, Carlos Gutierrez and Brazilian Minister of Development, 
Industry and Commerce (MDIC), Miguel Jorge, both expressed 
satisfaction with the consultative mechanism's progress to date and 
listened to accomplishments and future objectives from working group 
members present.  Approximately 20 people attended for each side, 
with additional spectators in the room.  Each side touted progress 
achieved in the past year, and favorably referred to their 
interactions leading up to Gutierrez's visit.  The meeting 
delineated future plans for collaboration on everything from 
business facilitation, intellectual property rights, customs 
facilitation, cooperation in services and information exchange, 
franchising, fostering venture capital and private equity 
investments, developing new international standards for biofuels as 
well as cooperation and training for two-way trade promotion 
focusing on a variety of industries including  energy, aerospace and 
defense and medical devices, as well as information and 
communications technology.  Brazil's Development, Industry and 
Commerce Minister Jorge stressed the positive bilateral relationship 
the Dialogue is helping to foster.  He noted that while trade flows 
are up, representing US$50 billion per year, this level is "still 
short of what we can expect in the future."  That said, he opined 
that the Dialogue was already achieving more than President Bush and 
President Lula ever had imagined.  Jorge also emphasized the social 
and political multiplier effects that such collaboration has. 
Secretary Gutierrez thanked the US and GOB interlocutors for their 
 
SIPDIS 
effort, time and commitment to the Dialogue, discussing its impact 
on not just our two countries, but also throughout the region, 
hemisphere, and the world.  He echoed Jorge's positive comments, 
saying that the Dialogue has thus far exceeded his expectations, not 
just in terms of increased trade and participation, but with the 
added benefit of having evolved from an exchange into a "real 
friendship." End Summary. 
 
-------------------------------- 
Patent and Trademark Cooperation 
-------------------------------- 
 
¶2.  Margaret J.A. Peterlin, Deputy Under Secretary of Commerce for 
Intellectual Property and Deputy Director of the Patent and 
Trademark Office (USPTO), and Jorge Avila, head of Brazil's 
counterpart, the National Institute for Industrial Property (INPI), 
discussed three areas that had been the focus of their successful 
bilateral work under the Commercial Dialogue:  helping to achieve 
automation in the patent and trademark application and examination 
processes, capacity building and substantive training, and outreach. 
 With regard to capacity building and training, 78 Brazilian 
intellectual property officials have trained at the USPTO's Global 
Intellectual Property Academy or via digital videoconferences (DVCs) 
during the past year.  Regarding automation, USPTO provided INPI 
with guidance on its automated trademark application and examination 
system; this past year, INPI established an on-line electronic 
trademark application system of its own. 
 
¶3.  Peterlin and Avila highlighted several new joint initiatives 
planned for the coming year.  These include: training in the field 
of biotechnology and semiconductors, sharing information on US and 
Brazilian special retrieval systems, exchanging new examiner 
training modules and materials, and sharing reports on quality 
assessment processes for new patent applications.  Regarding quality 
assessment processes, Peterlin noted that 80 to 90 percent of new 
patent applications filed in the U.S. are rejected upon first-filing 
because such applications are either incomplete or of poor quality. 
In this respect, the goal of this initiative would be to identify 
and implement quality assessment processes in Brazil to be able to 
determine similar problems in their first review, and thus reduce 
the backlog for applications that do merit approval.  In addition, 
they noted plans to conduct public outreach through Intellectual 
Property Awareness Campaign (IPAC) road shows in Brazil, in which 
USPTO would hold seminars discussing how to protect intellectual 
property rights in the U.S. 
 
---------------------- 
 Business Facilitation 
---------------------- 
 
¶4.  David Bohigian, the Commerce Department's Assistant Secretary 
for Market Access and Compliance, referred to the strong cooperation 
in business facilitation, saying that the USG and GOB are working 
together to reduce drastically last year's World Bank statistic of 
152 days to register a business in Brazil, with the goal of a 
one-stop, 15-day registration process.  On customs facilitation, 
Bohigian said Brazil is poised to make significant progress in the 
next few months, with the projected launch of an electronic, totally 
automated, paperless system for the processing of express 
 
BRASILIA 00002082  002 OF 003 
 
 
consignments.  He highlighted the extensive cooperation and 
technical exchanges between DOC and MDIC on services statistics, and 
noted a continued interest in working together on tourism 
statistics. He reported that both governments welcomed the addition 
of remanufacturing to the Commercial Dialogue, noting that it was an 
area ripe for significant discussion and improvement.  Bohigian 
welcomed the presence of ANVISA, the Brazilian medical device 
regulator, at the meeting, saying that Commerce and ANVISA hoped to 
achieve cooperation in the months ahead.  He complimented the 
Embassy on working hard to reduce the number of days to issue visas. 
 
 
¶5.  Bohigian's counterpart, Mauricio Lucena do Val of the Department 
of Commercial and Services Policies and the Dialogue's Business 
Facilitation Group Coordinator, agreed with Bohigian's assessment 
with minor additions.  He expressed Brazil's "bewilderment" at the 
recent statistics presented by the World Bank on business 
facilitation, and indicated that the GOB would like to amend 
legislation that imposes extra steps.  He mentioned the relevance of 
the Commercial Dialogue to the Ministry of Tourism, ANVISA, and 
IBGE, among other organizations, and said that the Dialogue's 
"extremely positive results" can be shown by the increasing 
accession of other government ministries and entities to the 
discussions.  He further discussed the idea of developing best 
practices within that group of ministries on health, environmental 
protection, and other important issues. On another customs 
facilitation issue, Brazil reported to the USG immediately prior to 
this meeting that Brazil's Customs and Internal Revenue Service 
(Receita Federal) was prepared to move forward on the ATA Carnet, 
taking internal steps that it would hoped would lead to Brazil's 
accession to the Istanbul Convention. 
 
------------------------------- 
Export and Investment Promotion 
------------------------------- 
 
¶6.  Fabio Faria, Director of the Department of Planning and 
Development of Foreign Trade and the Dialogue's Export and 
Investment Promotion Group Coordinator, talked about the 
strengthened ties that the Dialogue is creating.  More than two 
thousand Brazilians visited the United States to participate in 
trade fairs in the last year as a result of joint promotion by MDIC 
and the US Commercial Service, Faria said. This was a deliverable 
from the first Commercial Dialogue.  For this third session of the 
Commercial Dialogue, the Export and Investment Promotion working 
group discussed and developed a work plan to implement an MOU 
between the Associacao Brasileira de Franchising (Brazilian 
Association of Franchising), ABF, and its U.S. counterpart IFA.  The 
Group is working on a white paper that contains market information 
and best practices on franchising worldwide to promote franchising 
in both Brazil and the United States.  In addition, the Group 
highlighted the "Institutional Investment Learning Journey" as a 
deliverable, during which 10 U.S. representatives from pension funds 
and endowments visited Brazil to learn more about investment 
opportunities.  The group also plans to target between three and 
five industry sectors for coordinated trade show promotion in the 
United States and Brazil using online web seminars, among other 
tools.  Other training opportunities, such as identifying priority 
states on both sides for investment, fostering partnerships, and 
conducting a customs workshop in Brazil for US Commercial Service 
staff, were mentioned as future collaboration possibilities. 
Finally, a Venture Capital Task Force will be formed as part of a 
new Entrepreneurship and Private Equity work plan.  Commerce's ITA 
will work with ABDI to organize a one-day venture capital workshop 
in March, 2008 and a Venture Capital Forum by May of 2008.  Faria 
characterized this portion of the Dialogue as a "promising and 
ambitious agenda." 
 
--------------------------- 
Measurements and Standards 
--------------------------- 
 
¶7.  Dr. Willie May, Director of Commerce's National Institute of 
Standards and Technology (NIST), outlined collaborative efforts with 
Brazil's counterpart agency, the Instituto Nacional de Metrologia, 
Normalizacao, e Qualidade Industrial (INMETRO), during the past 
year, particularly on biofuels.  NIST and INMETRO have started 
taking positive steps toward defining measurements and standard 
variances, with the goal of the commoditization of biofuels.  The 
two organizations had a productive meeting in Rio de Janeiro, and 
then expanded it to a larger meeting in the U.S., in which 20 
countries participated.  The end result was a tripartite agreement 
with the European Union to try to harmonize biofuels standards and 
provide mutual verification.  Depending on what kind of source was 
being used, a "chemical fingerprint" can be ascertained, along with 
source IDs based on isotopic indicators.  NIST is planning a visit 
to INMETRO in January, 2008 to finalize internationally accepted 
biofuels standards and certifications, and they hope by January of 
 
BRASILIA 00002082  003 OF 003 
 
 
2009 to put together a biofuels certification plan.  In addition, 
the working group plans to develop a post-doctoral program with 
Brazil.  Right now, NIST has a program whereby they train 60 
scientists per year and keep the top one-third on staff.  They would 
like to assist the GOB in developing a similar program, wherein NIST 
would host select Brazilian post-doctoral candidates for a year, 
followed by a year at INMETRO, and then have INMETRO choose the best 
graduates for its own staff.  Separate to this program, two INMETRO 
staff members will be chosen to be at NIST.  The two organizations 
are trying to identify a similar opportunity for NIST to go to 
INMETRO for training, especially on biofuels. 
 
¶8.  Heidi Hijikata, Standards Liaison for Commerce's International 
Trade Administration, discussed a series of three DVCs that they 
have held with INMETRO on general trade-related standards regulation 
and assessments and one regarding biofuels. Future collaboration was 
envisioned for cosmetics, off-road equipment, medical devices, and 
information and communication technology, incorporating the 
Associacao Brasilieira de Normas Tecnicas/Brazilian Association of 
Technical Norms (ABNT), the National Association of Manufacturers, 
and other private sector entities into the discussion. 
 
¶9.  Dr. May's counterpart from Brazil's INMETRO, Dr. Humberto 
Brandi, said that from his organization's viewpoint, the Dialogue 
has been extremely productive, especially on biofuels collaboration, 
metrology and nanometrology, e.g. the effect of biofuels in steel, 
iron, and the combustive process. 
 
----------------------------------------- 
From Dialogue to Results, with Friendship 
----------------------------------------- 
 
¶10.  Minister Jorge expressed his pleasure with the working groups' 
presentations and perspectives, saying that transforming ethanol 
into a global commodity is truly "part of the heart, mind, and soul 
of our President," and something very positive.  Characterizing the 
discussion as emotional and emblematic of our two countries' 
friendship, Jorge reiterated his hope that we can continue to 
establish fruitful relationships.  "I was expecting a lot," he said, 
"but not as much as I heard today."  Gutierrez echoed the 
sentiments, saying his expectations were exceeded, and that the 
bilateral progress so far is impressive.  Furthermore, he expressed 
his feeling that there was a real friendship forming between the two 
countries' groups, bettering each side through the exchange of 
experiences and information. 
 
¶11.  This cable has been cleared with the visiting delegation. 
 
SOBEL