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PP RUEHAG RUEHAST RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA
RUEHLN RUEHLZ RUEHNP RUEHPOD RUEHROV RUEHSK RUEHSR RUEHVK RUEHYG
DE RUEHAK #0326/01 0611359
ZNR UUUUU ZZH
P 021359Z MAR 09
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC PRIORITY 8946
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY
RUEHDA/AMCONSUL ADANA PRIORITY 3646
RUEHIT/AMCONSUL ISTANBUL PRIORITY 5457
RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY

UNCLAS SECTION 01 OF 06 ANKARA 000326 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR EUR/SE DMARSH AND EEB/TPP/IPE FOR TMCGOWAN AND 
JURBAN 
DEPT PLEASE PASS USTR FOR JCHOE-GROVES AND MMOWREY 
 
E.O. 12958: N/A 
TAGS: ETRD KIPR USTR ECON TU
SUBJECT: TURKEY 2009 SPECIAL 301 REVIEW 
 
REF: A. STATE 8410 
     ¶B. 08 ANKARA 1471 
     ¶C. 08 ANKARA 1605 
     ¶D. 08 ANKARA 2175 
     ¶E. 08 ANKARA 2128 
     ¶F. 08 ANKARA 2191 
     ¶G. ANKARA 48 
     ¶H. ANKARA 117 
 
ANKARA 00000326  001.2 OF 006 
 
 
¶1. (SBU) This report is sensitive but unclassified.  Please 
protect accordingly. 
 
¶2. (SBU) Summary.  The last year has been a mixed story for 
IPR protection in Turkey, with several positive developments 
but two high-profile setbacks - a regression in the 
protection of confidential pharmaceutical test data and a 
legislative fiasco involving the criminal provisions of the 
trademark law that ended in the downgrading of 9000 trademark 
violation cases due to GOT inaction.   Following Turkey's 
move in 2008 from the Priority Watch List to the Watch List, 
these developments are especially disappointing.   Despite 
these setbacks, however, Turkey has made progress on many 
fronts, including three of the six action items agreed to in 
the 2007-2008 IPR Action Plan.  The Ministries of Culture and 
Justice, as well as the Customs Undersecretariat and Turkish 
National Police, have recognized the seriousness of Turkey's 
IPR problems and are taking some steps to address the lack of 
public awareness and the lack of training in both law 
enforcement and the judiciary.  The Ministry of Health, 
however, remains a serious obstacle to progress on IPR 
issues.  MOH violated outright the protection of confidential 
pharmaceutical test data for a U.S. company's product and 
circulated a draft regulation that would further reduce data 
protections for fixed combination products.  We recommend 
that Turkey remain on the Special 301 Watch List this year, 
and that the report focus attention on the need to address 
pharmaceutical sector concerns and to continue harmonizing 
Turkey's regulations and practices with its EU and 
international commitments.  End Summary. 
 
--------------------------------------------- 
The Good: Incremental Progress on Many Fronts 
--------------------------------------------- 
 
¶3. (SBU) The consensus in recent years has been that Turkey's 
IPR legislation, while flawed in some ways, is generally 
sound and that the real problems are in public awareness, 
enforcement, and judicial action.  We hoped that the GOT 
would seriously tackle all these fronts in 2008, but instead 
much of its attention was absorbed by the filing of a closure 
case against the ruling party in March and the onset of the 
global economic crisis in the third quarter.  This led to 
lack of policy coordination on many fronts.  Nonetheless, 
there were several noteworthy positive developments in IPR 
over the last year, including: 
 
(* indicates an item from the 2007-2008 IPR Action Plan) 
 
 
-- In February 2008, the GOT passed a new Copyright Law, 
harmonizing copyright law with the new Turkish Criminal Code. 
 There are some problems with the law (see para 10) but it 
ensured that copyright violations would continue to be 
treated as criminal offenses. (*) 
 
-- On April 24 (World IPR Day), in conjunction with the 
Business Software Alliance (BSA), the Ministry of Culture 
(MOC) launched an IPR public awareness campaign known as the 
"3 Monkeys."  This included a large billboard provided by the 
MOC in Istanbul's Taksim Square - the campaign is estimated 
to have reached 7.5 million people. (*) 
 
-- In May, the Ministry of Justice (MOJ) increased the number 
of specialized IPR courts by two, bringing the total to 23. 
 
-- On May 12-13, the MOC and MOJ held a conference in Izmir 
on the criminal provisions of the Copyright Law. 
Approximately 100 officials attended, including law 
enforcement as well as 60 prosecutors and judges dealing with 
IPR issues. (*) 
 
-- On May 29-30, forty Turkish Customs officials participated 
in a two-day Embassy-sponsored, INL-funded, USPTO training in 
Istanbul focused on detecting trademark and copyright 
infringement, with participation from the private sector. 
 
ANKARA 00000326  002.2 OF 006 
 
 
Further follow-up trainings in other cities are planned for 
March 2009. (*) 
 
-- On May 30, the Turkish Patent Institute (TPI), MOJ, and 
European Patent Institute held a seminar on patent litigation 
for 30 judges and prosecutors. 
 
-- On June 1, the MOC implemented a certificate system for 
all participants in the copyright production chain, including 
an electronic track-and-trace component and an automatic 
auditing mechanism that should ease the process of 
investigating suspect sellers. (Ref B) 
 
-- In June, Turkey formally opened the IPR accession chapter 
with the European Union.  This in and of itself indicates 
that Turkey had sufficiently improved its IPR environment to 
meet the chapter-opening benchmarks, but it also opens the 
door for further harmonization with the EU as Turkey 
negotiates to close the chapter. 
 
-- On July 15, the Prime Ministry issued a circular to all 
government agencies reminding them that public agencies must 
use only licensed software and requiring that they establish 
a mechanism to track and audit software licenses. (Ref B)(*) 
 
-- On August 28, Turkey formally acceded to the WIPO 
Copyright Treaty and the WIPO Performances and Phonograms 
Treaty, with no reservations.  The treaties entered into 
force on November 28, 2008. (Ref C)(*) 
 
-- In October, the GOT held the first meeting of the 
Undersecretary-level IPR Coordination Council to ensure that 
GOT policies across ministries are not working at 
cross-purposes.  This idea was pushed by the EU as part of 
the opening of the accession chapter. 
 
-- In November, MOC, MOJ, and Istanbul Bilgi University held 
a two-week training session in Antalya on all aspects of IPR, 
focusing especially on judges and prosecutors who had not yet 
participated in long-term or specialized IPR training.  40 
officials participated. (Ref D) 
 
-- In November, MOJ also issued a regulation requiring all 
prosecutor's offices to designate a specialized IPR 
prosecutor, and for offices with more than 500 cases per 
annum to establish a special IPR bureau. (Ref D) 
 
-- On November 22, the GOT held the first meeting of a 
"Juridical Consultation Group for IPR" to issue 
recommendations on improving the coordination of judicial 
decisions on IPR, including involvement by judges and 
prosecutors of the Supreme Court. (Ref D) 
 
-- In January and February 2009, the Turkish National Police 
held two three-day training sessions on all aspects of IPR 
for police and prosecutors charged with IPR enforcement. 
These were the fifth and sixth meetings in a longer-term 
training program. (*) 
 
-- Throughout the year, the MOJ worked on establishing the 
National Judiciary Network Project (UYAP), which aims to link 
various agencies and electronify records to speed the access 
of judges and prosecutors to case-relevant information.  The 
technical infrastructure is now in place, although several 
IPR-related agencies are still awaiting legislative action to 
permit their connection to the network.(Refs B and D) 
 
-- The MOC sponsored a short-film contest on IPR among 
graduate-level film students in which 170 students 
participated.  Television stations will be required to show 
the winning film, "Don't Kill the Original," as part of a 
public awareness effort.  The Ministry plans to make this 
into an annual program. The MOC has also reached out to 
prominent television studios to ask them to include IPR 
themes in their programs. (*) 
 
¶4.  (SBU) The above list is by no means exhaustive, but does 
indicate that the Ministries of Culture and Justice, as well 
as the Customs Undersecretariat and Turkish National Police, 
have recognized the seriousness of Turkey's IPR problems and 
are taking some steps to address the lack of public awareness 
and the lack of training in both law enforcement and the 
judiciary.  Much work remains to be done, but Turkey's 
incremental progress in a number of areas should be 
recognized. 
 
ANKARA 00000326  003.2 OF 006 
 
 
 
--------------------------------------------- --------------- 
The Bad: Legislative Incompetence/Inaction, and Enforcement 
Problems Continue 
--------------------------------------------- --------------- 
 
¶5. (SBU) The low point of the past year was the GOT's lack of 
timely response to a Constitutional Court decision annulling 
the criminal provisions of the Trademark Law. (Refs D, E, F, 
G and H)  On July 6, the Court ruled that the criminal 
penalties in the Trademark law were unconstitutional because 
the law was issued by decree rather than passed by 
Parliament.  The Court gave the GOT six months, until January 
5, 2009 to pass a new law through Parliament to maintain 
these criminal penalties in force, and the government was 
well aware of the deadline (Refs D and E).  Due to what can 
at best be described as GOT incompetence, the deadline passed 
with no new law, resulting in the invalidation of 
approximately 9000 pending criminal trademark cases. 
Following this debacle, the GOT sped a new law through 
Parliament in near-record time, drafting it on the January 6 
and promulgating it on January 29, but the damage had already 
been done.  In an effort to prevent IPR criminals from 
getting away completely, the MOJ has decided to prosecute the 
same 9000 cases under unfair competition provisions of the 
commercial code, but this reduces the maximum penalty, and it 
is unclear if convictions under this provision will be upheld 
on appeal.  Many attorneys representing rights holders also 
are concerned that the fake goods confiscated in these 9000 
cases will be returned to the counterfeiters, which would 
flood literally millions of fake products into the 
marketplace.  The only encouraging part of the whole episode 
is that the Constitutional Court's decision was not based on 
any objection to IPR.  Had the GOT acted in time, it would 
have been a side note to the year. 
 
¶6. (SBU) At the same time that Parliament was busy not 
dealing with this specific trademark issue, it was also 
unable to make much progress on the new patent law or the 
full trademarks law, both of which have been languishing for 
several years now (Ref E). Indeed, until the new patent law 
passes there is some confusion as to whether criminal 
penalties still apply to patent violations - the new Turkish 
Criminal Code made all criminal penalties in other laws null 
and void as of January 1, 2009, unless they had been 
harmonized with the Code.  Copyright and trademark penalties 
have now been harmonized (the latter by accident), but until 
the patent law passes there are theoretically no criminal 
protections (civil penalties still apply). 
 
¶7. (SBU) Both the patent and trademark laws also contain some 
troubling language, which the private sector and post are 
working to fix.  For example, a requirement in the trademark 
law that a copy of the original product must be submitted in 
every trademark case could cause substantial costs to the 
victimized rights holder when dealing with items worth 
thousands of dollars.  The Turkish Patent Institute has taken 
private sector concerns seriously, however, and in late 
February 2009 even allowed for private sector interests to 
see the draft law and provide comment, which is almost 
unheard of within the Turkish legislative system and an 
encouraging sign.  There are frequent rumors regarding 
several amendments to both the patent law and trademark law 
that would make them applicable only to goods produced in 
Turkey, but the technical agencies involved (TPI, Foreign 
Trade, etc.) have so far been diligent in ensuring that these 
amendments are not included in the legislation. 
 
¶8. (SBU) There was some marginal improvement in the 
enforcement environment in 2008, but serious problems remain. 
 Anecdotally, rights holders have told us they are pleased 
with the enforcement activities of the specialized IPR units 
within the Turkish National Police and with the 
responsiveness of MOC, MOJ and the Customs Undersecretariat. 
One software representative noted that 90% of their requests 
for warrants are granted by the specialized IPR courts as 
long as there is sufficient evidence of infringement, 
representing a huge shift in judicial attitudes.  However, 
outside of these specialized units (i.e. outside of the large 
cities), rights holders find themselves in a constant battle 
to convince police to take action and to persuade judicial 
authorities to take the crimes seriously.  This is compounded 
by the fact that such authorities are often themselves 
involved in IPR-infringing activities.  Rights holders (and 
the police themselves) also note that even the specialized 
 
ANKARA 00000326  004.2 OF 006 
 
 
units are underfunded and lack 
 appropriate equipment. 
 
¶9. (SBU) Enforcement statistics show an overall increase in 
seizures of counterfeit products, although they have fallen 
in some categories where the products are either becoming 
outdated (music and video cassettes) or moving online (music 
CDs).  The following chart highlights statistics from the 
Security General Directorate - also reflected in the 
submission of the International Intellectual Property 
Alliance (IIPA). 
 
------------------ 
Seizure Statistics              2007          2008 
------------------              ----          ---- 
 
Operations                      3741          2847 
Persons Arrested                4132          3226 
 
Non-Banderoled Products 
----------------------- 
CD/VCD                        2.1 million     1.4 million 
DVD                           490,000         1.3 million 
Books                         235,000         575,000 
Video Cassettes               400             250 
Music Cassettes               28,000          8,100 
 
Banderoled Products 
------------------- 
CD/VCD                        12,000          6,000 
DVD                           1               700 
Books                         10,000          22,000 
Music Cassettes               55,000          15,000 
 
CD/VCD/DVD Inlays             8.2 million     24.2 million 
 
¶10. (SBU) As noted in the IIPA submission, there has been 
considerable confusion over whether or not Police and 
Inspection Committee officials possess ex officio power to 
conduct raids.  The language in the previous Copyright Law 
was deleted from the February 2008 version, not because the 
power was removed but because it is enshrined elsewhere in 
law and the amendment drafters felt it was redundant.  Post 
agrees with IIPA that a formal circular confirming ex officio 
power could help to reduce this confusion and encourage 
police to initiate raids without a complaint from a victim. 
 
¶11. (SBU) Internet piracy is a growing problem in Turkey, 
especially as more Turks gain broadband access to the 
Internet.  The GOT has been active in providing support to 
fight Internet piracy, and both the copyright law and the 
recent trademark amendment contain specific, strong language 
to fight abuse of IPR on the Internet.  Rights holders report 
that GOT authorities also respond quickly to requests to 
block access to various piracy sites.  As broadband access is 
expanding rapidly, the GOT is in a constant race to keep up 
with the widening scope of the problem, but has shown a good 
effort to date. 
 
¶12. (SBU) Certain Customs regulations continue to pose 
problems for rights holders.  Trademark owners are still 
required to file in paper to every Customs site on a monthly 
basis in order to receive protection for their goods, an 
exhausting and expensive process.  A new Customs law is under 
consideration that would replace this system with a 
centralized electronic, yearly filing requirement (Refs B and 
H) and passage is expected this year.  Customs is also only 
allowed to hold suspected counterfeit goods for 10 calendar 
days absent a formal complaint from the rights owner. 
Because of time differences, these days are rapidly used up 
when trying to coordinate with a rights holder in the U.S., 
especially if the victim must travel to a remote portion of 
Turkey to identify the goods. 
 
¶13. (SBU) There has been little to no improvement on speeding 
up judicial cases, although this may change once the UYAP 
system is fully implemented and judges and prosecutors have 
direct access to copyright, trademark, and patent files. 
Almost all IPR cases are appealed and the average time to 
process an appeal is still well over two years.  Even when 
convictions are achieved and upheld, sentences also lack 
deterrent effect and frequently end in suspended sentences or 
nominal fines. 
 
--------------------------------------------- ------- 
 
ANKARA 00000326  005.2 OF 006 
 
 
The Ugly: Pharmaceutical Protections Moving Backward 
--------------------------------------------- ------- 
 
¶14. (SBU) The most troubling developments in the last year 
occurred at the Ministry of Health (MOH), which violated 
outright the protection of confidential pharmaceutical test 
data for a U.S. company's product and which circulated a 
draft regulation that would further reduce data protections 
for fixed combination products. 
 
¶15. (SBU) In January 2009, in violation of the data 
exclusivity rights of a U.S. pharmaceutical company, the MOH 
issued marketing approval for a copycat generic product. 
This action occurred just days after the approving official, 
Dr. Mahmut Tokac, told Assistant USTR Christopher Wilson in a 
formal U.S.-Turkey bilateral trade meeting that Turkey's 
obligations on data protection for fixed combination products 
were "unclear" and that the EU had not yet provided 
instruction on the matter (Ref H).  Rather than place the 
approval application on hold pending that clarification 
(which had in any event already been provided by the EU in a 
series of letters dating back four years), MOH went ahead and 
approved the product.  Despite the intervention of the U.S. 
company, the U.S. Embassy, and the European Commission 
Delegation to Turkey, the MOH has refused to withdraw its 
approval and the product was approved for pharmaceutical 
reimbursement by the Social Security Administration just a 
few weeks later and is now on the market (and is being 
marketed for just 30 kurus less than the US company's product 
- the equivalent of about 18 U.S. cents).  A second U.S. 
product from a different company now faces the same problem. 
This constitutes a serious violation not only of Turkey's WTO 
TRIPS and its European Customs Union obligations, but also of 
internal Turkish law and of the national treatment principle 
(foreign companies' approval and reimbursement applications 
routinely take years).  Post continues to work with relevant 
Turkish agencies to rectify this situation, but for the time 
being, the attitude of MOH remains a significant black mark 
against Turkey. 
 
¶16. (SBU) At the same meeting with AUSTR Wilson, MOH 
officials denied that they had proposed amending the 
regulations on pharmaceutical data protections, even though 
the industry had been formally requested to provide input in 
December (in some ways a positive sign, as they were at least 
consulted first).  The amendment would have, among other 
things, specifically changed the recipient of data protection 
from its current form of "product" to "molecule."  This would 
have had the effect of removing fixed combination products 
from the group of protected products.  The amendment would 
also have eliminated the requirement for testing if a 
combination product's individual ingredients had previously 
been approved - leaving aside the troubling IPR aspect of 
this rule, it poses serious public health risks.  Although 
this amendment has not moved forward, it may have been 
intended to provide cover for the MOH's later actions 
violating data exclusivity. 
 
¶17. (SBU) In other issues of concern to the pharmaceutical 
sector, there has still been no progress on the patent 
linkage proposal (i.e., a formal system in which MOH checks 
to see if a patent has been issued before issuing a marketing 
approval).  GOT officials privately recognize that the idea 
has some merit, but argue that Turkey has no obligation to 
implement the system under its existing obligations.  Data 
exclusivity also remains tied to the remaining term of the 
product patent and dates from the first approval in the 
European Customs Union.  Turkey will eventually need to 
harmonize its data exclusivity rules entirely with the EU 
(meaning an 11 year period of protection), but has indicated 
that it plans to tie this harmonization to the date it 
becomes a full member of the EU.  This could push back 
implementation by over a decade. 
 
------------------------- 
Where Do We Go From Here? 
------------------------- 
 
¶18. (SBU) Post recommends that Turkey remain on the Special 
301 Watch List.  We recognize that considerable problems 
remain in Turkey's IPR regime and that the failure to amend 
the trademark law in a timely manner and MOH's actions 
against data exclusivity provide some justification for 
raising Turkey back to the Priority Watch List.  In our 
judgment, however, penalizing Turkey this year is likely to 
 
ANKARA 00000326  006.2 OF 006 
 
 
dishearten those in the MOJ, MOC and Customs Undersecretariat 
who are making good faith efforts to improve Turkey's IPR 
protections, and is highly unlikely to change problematic 
attitudes at the MOH.  As one attorney recently noted to us, 
"Fixing Turkey's IPR problems requires a change in the 
society's mentality, and that will not happen overnight." 
The past year's training programs and public awareness 
campaigns lay the essential groundwork for future progress. 
 
¶19. (SBU) Just because progress is slow, however, does not 
mean it should stop.  We believe that in the coming year 
Turkey should: 
 
-- Ensure that vital pieces of IPR legislation, such as the 
new patent and trademark laws and the new Customs law are 
finally passed and implemented.  The laws should be crafted 
to bring Turkey more in line with EU and international norms 
instead of diverging from them, so frivolous or harmful 
amendments should be avoided; 
 
-- Issue a circular reaffirming the ex officio powers of law 
enforcement to act against IPR violations; 
 
-- Continue to provide enhanced training programs for judges, 
prosecutors and law enforcement and expand the reach of these 
programs beyond the specialized courts and units dealing with 
IPR; 
 
-- Transfer control of the banderole system for copyrighted 
products to the private sector (Note: MOC officials have 
informed us that they plan to give the power to issue 
banderoles to the collecting societies in the coming year, 
under MOC supervision.  End note.); 
 
-- Ensure that pharmaceutical fixed combination products 
receive confidential test data protection in line with 
Turkey's laws and EU commitments; and, 
 
-- Consider including private sector representatives on the 
IPR Coordination Board. 
 
We believe that all of these goals could be achieved within 
the coming year and that taken together they would contribute 
to a significant continued improvement in Turkey's IPR 
regime. 
 
Visit Ankara's Classified Web Site at 
http://www.intelink.sgov.gov/wiki/Portal:Turk ey 
 
Jeffrey