VZCZCXRO5198
RR RUEHAG RUEHBC RUEHDE RUEHDF RUEHIK RUEHKUK RUEHLZ RUEHROV RUEHSR
DE RUEHLB #0099/01 0261606
ZNR UUUUU ZZH
R 261606Z JAN 09
FM AMEMBASSY BEIRUT
TO RUEHC/SECSTATE WASHDC 4054
INFO RUEHEE/ARAB LEAGUE COLLECTIVE
RUCNMEM/EU MEMBER STATES COLLECTIVE
RHEHAAA/NSC WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RUCPDOC/USDOC WASHDC

UNCLAS SECTION 01 OF 03 BEIRUT 000099 
 
SENSITIVE 
 
SIPDIS 
 
STATE FOR NEA/ELA ALLEN 
STATE PASS USTR FRANCESCKI 
STATE PASS USAID BEVER/LAUDATO/SCOTT 
TREASURY FOR PARODI/BLEIWEISS/AHERN 
USDOC FOR 4520/ITA/MAC/ONE 
 
E.O. 12958: N/A 
TAGS: ECON EFIN KIPR PGOV LE
SUBJECT: LEBANON:  POLITICAL WILL KEY TO FURTHER PROGRESS ON IPR 
ENFORCEMENT 
 
REF: STATE 77184 
 
SUMMARY 
-------- 
 
¶1. (SBU) Most Intellectual Property Rights (IPR) experts tell us 
current Lebanese legislation is generally adequate and WTO 
compliant, while Lebanon's biggest IPR problem is enforcement.  IPR 
industry contacts say courts should impose more stringent fines on 
violators.  IPR infringement in the pharmaceutical industry remains 
a problem, although recent procedural changes could improve the drug 
registration process.  On cable piracy, the Lebanese Internal 
Security Forces (ISF) has stepped up efforts to bring illegal cable 
operators into line. 
 
¶2. (SBU) The GOL and major industry groups mounted several IPR 
awareness campaigns in 2008 to educate the public on the negative 
impact of IP infringement.  Post has been active in helping boost 
the GOL's IPR capabilities by, inter alia, sending judges to USG 
training, and funding the police unit in charge of IPR enforcement. 
Ultimately, a high-level political push may be necessary to 
strengthen enforcement further.  End summary. 
 
LEGISLATION WTO COMPLIANT... 
---------------------- 
 
¶3. (SBU) In its current form, Lebanese IPR legislation is generally 
adequate for WTO accession, according to various experts we have 
consulted.  The head of the MEPI-funded Booz Allen Hamilton WTO 
Accession Project at the Ministry of Economy and Trade (MOET), Zouha 
Sakr, told us new IPR laws -- on geographical indications, 
trademarks, and industrial design -- currently awaiting 
parliamentary approval are merely improvements and clarifications to 
existing laws, not requirements to fill gaps in current legislation. 
 An amendment to the copyright law also is awaiting parliamentary 
approval, but includes only minor changes. 
 
...BUT ENFORCEMENT REMAINS 
THE BIGGEST PROBLEM 
-------------------- 
 
¶4. (SBU) Enforcement of existing laws remains the biggest challenge 
for IPR protection.  Most IP-infringing material is either smuggled 
in or imported through legitimate points of entry under the 
jurisdiction of Lebanese customs, which lacks the necessary staff, 
equipment, and training properly to enforce the law.  The Internal 
Security Force's (ISF) Cyber Crime and IP Unit is also understaffed 
and lacks necessary training, although it has made significant 
progress in protecting IPR since its establishment in 2006. 
 
¶5. (SBU) The USG has been active in boosting and further developing 
the capabilities of the ISF and customs.  A local NGO, with a 
$143,000 Department of State International Narcotics and Law 
Enforcement (INL) grant is currently working on training and 
providing equipment for the ISF's Cyber Crime and IP Unit to improve 
its IPR enforcement.  In addition, Embassy Beirut is recommending a 
training program for customs officials to improve their capability. 
 
 
¶6. (SBU) Private sector contacts have repeatedly advised us that the 
judicial system should be more firm in its enforcement of IPR laws, 
especially in terms of the fines it imposes on infringers, which are 
not prohibitive.  The State Prosecutor of the Cassation Court, Said 
Mirza recognizes the importance of IPR.  However, he argued that the 
number of IPR cases in Lebanon does not justify having judges 
dedicated solely to IPR.  During the past two years, post has sent 
15 judges on USPTO training programs on IPR issues. 
 
PHARMACEUTICAL INDUSTRY 
INFRINGEMENTS 
-------------------- 
 
¶7. (SBU) Problems in the pharmaceutical sector related to IPR remain 
a significant problem.  Ambiguity in the current patent law related 
to the treatment of undisclosed information (UI, i.e., trade secrets 
or any confidential information of commercial value) that 
pharmaceutical companies resent during the registration process at 
the MOP continues to be a contentious issue.  According t members 
of the Pharmaceutical Research and Manufacturers of American 
(PhRMA), this has lead the MOPH to consider as UI summaries of UI or 
 
BEIRUT 00000099  002 OF 003 
 
 
other publicly available information in the registration process of 
drugs, leading to the registration of a number of copycat drugs. 
 
¶8. (SBU) Legislative reform mainly related to UI is necessary to 
bring about Lebanon's full compliance with WTO trade-related aspects 
of intellectual property rights (TRIPS) standards.  The fastest way 
to deal with this problem would be to amend the UI portion of the 
existing patent law.  However, the MOPH is pushing for 
clarifications on UI to be included in a new unfair competition law 
that is still being drafted.  Passing a new law would require 
cabinet and parliamentary approval, as well as an implementation 
decree (which can take years, even after a law passes parliament) 
before any of the law can take effect.  Private and public sector 
contacts have told us that the MOPH may have an interest in delaying 
reform in this area, because the minister and people close to him 
benefit financially and politically from the ambiguity regarding UI 
in the current patent law. 
 
¶9. (SBU) MOPH Director General Walid Ammar (protect) told us that 
Health Minister Mohammad Khalifeh (an ally of Parliament Speaker 
Berri) moves certain registration applications to the front of the 
line based on political connections or the political affiliation of 
the importer, regardless of the quality of the data in the 
application.  According to Ammar, the process of drug registration 
will improve with the recently signed Decree No. 571, which includes 
requirements on the treatment of UI in a registration application. 
Though the decree leaves some room for interpretation of what is or 
is not UI, it theoretically could stop drugs with incomplete data 
from being registered. 
 
¶10. (SBU) Ammar also complained that pharmaceutical companies force 
Lebanon to purchase drugs from more expensive manufacturers in the 
EU rather than from the U.S. or other less expensive countries, 
based on "zoning," a system in which pharmaceutical companies 
designate specific geographical areas to which their exclusive 
agents can export their products.  As a result, the MOPH has allowed 
so-called parallel imports (or importing goods that are produced 
genuinely under IP protection, but imported from a market without 
the authorization of the holder of the IP right, which in this case 
is from cheaper countries) to lower costs, Ammar said. 
 
ISF TACKLING CABLE PIRACY 
-------------------- 
 
¶11. (SBU) The issue of cable piracy has always been linked to 
political interests in Lebanon, with government officials reluctant 
to enforce regulations and operators relying on political 
connections to keep them in business.  Sakr of Booz Allen and her 
team strongly believe the current copyright law is enough to protect 
against copyright infringement through cable piracy, but needs to be 
better enforced by the MOET.  However, contacts at the MOET believe 
the only way to regulate and control piracy is through a new law 
that would give the MOET a stronger mandate to intervene when it 
sees violations.  Without high-level support and the backing 
provided by a new law, MOET contacts do not feel they would have the 
political cover to cut the pirate operators' lines. 
 
¶12. (SBU) The ISF has told us that following a series of lawsuits 
from major cable TV operators (including ART, Orbit, Showtime, MBC, 
and FTV), local illegal cable providers have started paying cable TV 
operators for the rights to broadcast and distribute programs. 
According to the head of the ISF Cyber Crime and IP Unit, Major 
Bitar, 90 percent of local cable providers are now paying for the 
right to broadcast content from major cable TV operators, which has 
led to an increase in monthly subscription fees to illegal cable 
providers.  The ISF enforces the law by making sure local cable 
providers are paying their fees and have the necessary equipment for 
legal distribution. 
 
PRIVATE AND PUBLIC SECTOR 
AWARENESS CAMPAIGNS 
-------------------- 
 
¶13. (SBU) A number of IPR awareness campaigns have taken place to 
educate the public on IP infringements.  In February 2008, the MOET 
launched a three-month campaign, funded by USAID and the American 
Lebanese Chamber of Commerce, advertising the importance of 
protecting intellectual property.  In August, the MOPH launched a 
campaign to combat counterfeit drugs.  Also in 2008, the 
locally-based Brand Protection Group (BPG - an NGO grouping over 20 
 
BEIRUT 00000099  003 OF 003 
 
 
leading local and international companies aimed at raising awareness 
on counterfeits) re-launched its awareness campaign, which had been 
set to launch in 2006 but was postponed due to the July 2006 war. 
 
¶14. (SBU) More recently, in December 2008, the Ministry of Education 
(MOE) announced that IPR would be the theme for its 2009 SchoolNet 
Project. (Note:  The SchoolNet Project is a MOE scheme, initiated in 
2002, that seeks to connect all private and public schools and 
libraries in a single network to facilitate teaching and learning. 
End note.)  The initiative -- which will teach students about the 
consequences of IPR violation by Lbanese consumers and businesses 
-- is being implmented in partnership with Microsoft Lebanon, the 
Educational Association for IT Development (EAID), and the 
International Education Association (IEA) - Lebanon. 
 
COMMENT 
------- 
 
¶15. (SBU) The GOL has made progress on cable piracy and on public 
awareness in general.  It appears to be trying to put in place a 
better drug registration regime.  There is a well-trained class of 
civil servants who seek strengthened enforcement of the law, in 
large part because the U.S. and other foreign donors have 
consistently worked with the GOL to encourage IPR protection and 
build capacity.  As is often the case with so many issues in 
Lebanon, high-level GOL action is probably needed further to 
strengthen IPR protection further.  Embassy Beirut will continue its 
engagement with all the relevant Lebanese actors to encourage better 
enforcement. 
 
SISON