VZCZCXYZ0000
RR RUEHWEB

DE RUEHMU #1051/01 2311930
ZNR UUUUU ZZH
R 181930Z AUG 08
FM AMEMBASSY MANAGUA
TO RUEHC/SECSTATE WASHDC 3034
INFO RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE

UNCLAS MANAGUA 001051 
 
STATE FOR WHA/CEN, EB/TPP/IPE 
DEPT PLEASE PASS TO JUSTICE FOR OPDAT ROBERT LIPMAN 
STATE PLEASE ALSO PASS TO USTR FOR ANDREA MALITO 
TREASURY FOR SARA GRAY 
USDOC FOR 4332/ITA/MAC/WH/MSIEGELMAN 
USDOC PLEASE PASS TO USPTO FOR BARBARA MCCAFFREY 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ECON ETRD KIPR USTR NU
SUBJECT: NICARAGUA: MIXED RESULTS ON POLICE IPR ENFORCEMENT 
STRATEGY 
 
REFS: A) MANAGUA 225, B) 07 MANAGUA 2654 
 
SUMMARY 
------- 
 
¶1. (SBU) In 2008, the Nicaraguan National Police is implementing a 
strategy to improve intellectual property rights (IPR) enforcement 
that includes a public awareness campaign, training for staff, and 
raids against the producers and distributors of pirated goods.  In 
addition, the police seek better cooperation with industry to combat 
piracy and trademark and copyright infringement.  We share the 
concerns of the police and working-level Government of Nicaragua 
(GON) officials that recent reforms to the new Criminal Code 
undermine efforts to improve IPR enforcement.  The GON has yet to 
convict, fine, or imprison any IPR offender this year. 
 
IMPROVING IPR ENFORCEMENT 
------------------------- 
 
¶2. (SBU) In 2008, the National Police has been implementing its 
strategy to improve IPR enforcement.  The components of this 
strategy are a public awareness campaign against piracy, training 
for staff on the application of IPR laws and the detection of 
pirated goods, and raids and seizures of pirated goods and 
production equipment.  The police conducted its public awareness 
campaign from January until March, targeting three open air markets 
in Managua where pirated goods are abundant.  Police officers 
informed vendors of pirated goods that piracy is illegal and anyone 
caught producing and selling these products will be arrested and 
prosecuted.  The campaign also attempted to dissuade customers from 
purchasing pirated goods and highlighted the adverse impact of 
piracy on the Nicaraguan economy. 
 
¶3. (SBU) With regard to training, the police participated in two 
capacity building workshops this year.  In February, Nicautor, an 
association that advocates IPR enforcement and protection for 
authors and composers, trained a class of 30 police officers and 
public prosecutors on IPR enforcement under the new penal code.  The 
GON also organized a training course in July for 110 police officers 
in the Department of Leon on the new penal code.  The Embassy has 
also arranged training for judges and patent and trademark 
officials.  In May, the Embassy sent three judges on a U.S. Patent 
and Trademark Office (USPTO) IPR course.  In September, we will send 
two GON officials responsible for patent and trademark protection to 
USPTO's course on the Madrid Protocol for trademark protection. 
 
ENFORCEMENT RESULTS 
------------------- 
 
¶4. (SBU) As of July, the GON has conducted six raids.  The police 
seized a total of 938 drums of bottled water in which the trademark 
rights of "Pura Fuente (Pure Fountain)" had been violated.  The 
police also seized 80,000 blank CDs and DVDs and six recording 
units, 350,000 pirated music CDs and music video DVDs, and 12 
computers, 46 televisions, and 3 multipurpose copiers.  The monetary 
value of the seized goods is approximately $803,000.  [Note: The 
police calculated the monetary value of the pirated CDs and music 
video DVDs based on the market price of 20 cordobas or $1.00 per 
disc.  The sales price for blank CDs is five cordobas or 25 U.S. 
cents.] 
 
¶5. (SBU) The Prosecutor General's Office indicted thirteen IPR 
offenders as of the end of June.  Seven cases await adjudication by 
the courts.  Six cases were dismissed for a lack of sufficient 
evidence.  Dr. Leyla Prado, head of the Prosecutor General's IPU 
Unit, complained that the loss of key staff and budget cuts this 
fiscal year limited her unit's ability to participate in raids, 
conduct investigations, and file cases with the local courts.  She 
added that there have been no arrests, convictions, or fines against 
any IPR offender this year.  At the same time, she noted that there 
has been an increase in IPR related complaints, particularly 
trademark infringement infractions. 
 
INDUSTRY COOPERATION 
-------------------- 
 
¶6. (SBU) The police have sought improved cooperation with industry 
to combat piracy and other IPR crimes.  On June 26, Econoff met with 
Major Francisco Obando, National Police Director for the Economic 
Crimes Unit.  Obando stated that although Nicautor organized IPR 
training for the police in February, the police want more assistance 
from industry on detecting trademark and copyright infringement, and 
need better equipment, such as computers and scanners, digital 
 
cameras, and digital product code scanners, to enhance the Unit's 
capabilities.  To facilitate the cooperation with industry, the 
Embassy will host industry and police representatives in a meeting 
on August 26 to discuss IPR enforcement and protection. 
 
CONCERNS ABOUT NEW CRIMINAL CODE 
-------------------------------- 
 
¶7. (SBU) Privately, Obando and Prado complained that reforms to the 
new Criminal Code weaken IPR enforcement.  The National Assembly 
approved amendments to the Copyright Law in 2006 to add a provision 
that the Prosecutor General's Office could investigate an IPR crime 
ex oficio, without a formal compliant.  The Criminal Code approved 
in November 2007 repealed this provision.  [Note: In separate 
meetings with Embassy officials, Ministry of Trade, Industry and 
Development (MIFIC) officials have argued that the Procedural 
Criminal Code allow for ex-officio enforcement.] 
 
¶8. (SBU) The National Assembly also weakened penalties for copyright 
violations in the new Criminal Code.  In 2006, amendments to the 
Copyright Law stiffened penalties for IPR crimes, including fines 
ranging from 3,000 to 25,000 cordobas ($160 to $1,315) and prison 
sentences of up to two years.  The new Criminal Code adopts aspects 
of Sweden's penal code to calculate the fine for an IPR offender 
based on one-third of that person's daily salary multiplied by 90 to 
150, depending on the severity of the crime.  The new Criminal Code 
also reduces prison sentences to a maximum of one year (Ref A).  The 
new Criminal Code came into effect on July 9, 2008. 
 
¶9. (SBU) Obando said the new Criminal Code restricts the police's 
ability to act independently because they must wait to receive a 
formal complaint about IPR violations before they can undertake a 
raid.  He asserted that the police would like the flexibility to 
conduct surprise raids.  Prado noted that her unit, the police, and 
some MIFIC officials have raised these concerns during interagency 
meetings.  She added that her MIFIC colleagues have stressed that 
GON commitments made as a party to the United States - Central 
America - Dominican Republic Free Trade Agreement (CAFTA-DR) in 2006 
were in line with Nicaragua's obligations as a member of CAFTA. 
Prado added that she and her GON colleagues are trying to persuade 
senior-level government officials to revert to the 2006 amendments, 
or introduce new legislation that is consistent with the country's 
CAFTA commitments. 
 
COMMENT 
------- 
 
¶10. (SBU) The National Police is confident that its strategy will 
improve IPR enforcement, but so far this year the GON has not 
convicted, fined, or imprisoned any IPR offender.  Although the 
police appear to be committed to improving IPR enforcement, we are 
concerned that the new Criminal Code limits the ability of the 
police to conduct raids and seize pirated goods.  Meanwhile, it 
appears as if IPR protection continues to be a low priority for 
senior-level officials.  End Comment. 
 
SANDERS