VZCZCXRO6938
RR RUEHDA
DE RUEHAK #1843/01 3630821
ZNR UUUUU ZZH
R 290821Z DEC 09
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC 1573
INFO RUCPDOC/USDOC WASHDC
RUEATRS/TREASURY DEPT WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC
RUCPCIM/CIMS NTDB WASHDC
RUEHIT/AMCONSUL ISTANBUL 6693
RUEHDA/AMCONSUL ADANA 4347

UNCLAS SECTION 01 OF 02 ANKARA 001843 
 
SIPDIS 
 
DEPT FOR EUR/SE, EEB/TPP/BTA, EEB/TPP/IPE 
DEPT PLEASE PASS USTR FOR MMWOREY, JCHOE-GROVES 
COMMERCE FOR ITA/MAC CRUSNAK, KNAJDI 
COMMERCE FOR ITA/USFCS/OIO/CEENIS/RMILLER/MCOSTA 
 
E.O. 12958: N/A 
TAGS: EINV ETRD KTDB KIPR USTR TU
SUBJECT: CANCELLED TRADEMARK CASES STILL UNRESOLVED 
 
REF: A) 08 ANKARA 2175, B) 08 ANKARA 2191, C) ANKARA 15, D) 
ANKARA 48, E) ANKARA 117 
 
This cable is sensitive but unclassified.  Please protect 
accordingly. 
 
¶1. (SBU) Summary:  As reported in reftels, the temporary 
suspension in 2008 of the criminal provisions of Decree 556 
(Trademark Law) led to the cancellation of as many as 9,000 
IPR cases and the possible re-entry of millions of units of 
seized counterfeit goods into the Turkish market.  Previously, 
Ministry of Justice officials promised that these cases would 
be considered under the "unfair competition" provision of the 
commercial code.  However, some recent lower and appeals court 
rulings have found no legal basis for criminal prosecution and 
have ordered that the seized counterfeit goods be returned to 
defendants.  Although the Ministry of Justice could intervene 
and issue new guidance to the courts, this seems unlikely.  If 
the counterfeit goods re-enter the market, the new trademark 
law would give the companies the right to re-seize the goods 
if counterfeiters decided to sell them again, but would entail 
enormous costs to injured companies to re-open court cases, as 
well as requiring law enforcement to duplicate seizures, 
presumably against more savvy criminal operations.  End 
summary. 
 
¶2. (SBU) On July 5, 2008, the Constitutional Court struck down 
the provisions of the "Protection of Trademarks" law (Decree 
556) that made trademark violations a crime. A new amendment 
to re-criminalize trademark violations was passed in January 
2009, but was not retroactive, causing the cancellation of up 
to 9,000 pending IPR cases (see reftels for further detail). 
At the time, the Ministry of Justice promised that the 
canceled cases would be considered under the "unfair 
competition" provision of the commercial code.  Unfortunately, 
recent lower court rulings found no legal basis for criminal 
prosecution and ordered that confiscated goods should be 
returned to the former defendants.  Reportedly, many of the 
defendants were dealing in such large volumes - tens of 
thousands of units - that it was strongly likely that they 
were organized crime elements engaged in manufacture as well 
as distribution, rather than just small-time sellers. 
 
¶3. (SBU) Representatives of several companies affected by the 
recent rulings met with ECON and FCS staff on December 10, 
2009 to identify potential courses of action to stop the 
counterfeit goods from re-entering the market.  Many of the 
companies have appealed the decisions to return the goods, but 
the first wave of Court of Appeals decisions indicates that 
the rulings of the lower courts will be upheld.  Thirteen 
international brands have identified 5,374 cases that have 
been or may be impacted, representing more than 2.6 million 
units of counterfeit goods which would return to defendants. 
 
¶4. (SBU) The courts have ordered the destruction of products 
in some cases, such as cosmetics and perfumes, on the basis of 
public health concerns.   This would not apply to textiles or 
footwear products, and as it is only a crime to sell 
counterfeit goods (possession is not criminal), the police 
cannot simply re-seize the goods absent an actual attempt to 
market them.  The companies claim that the Minister of Justice 
could make an extraordinary appeal and issue guidance to the 
courts, but this seldom-used option is unlikely, and would be 
dependent upon a series of strict conditions that this 
situation does not appear to meet.  Another option would be 
for the GOT to criminalize possession of a sufficiently large 
number of counterfeit goods (similar to antinarcotics laws 
that presume the intent to distribute).  The companies are 
investigating that option, but such a legislative fix is 
unlikely to happen quickly enough to help. 
 
¶5. (SBU) Companies affected by these cases are left with few 
options except to prepare for the counterfeit goods to re- 
enter the market.  The new trademark law would give them the 
right to re-seize any goods which counterfeiters attempt to 
sell again on the market, and they could then be tried under 
the new code.  The associated legal costs are likely to be 
enormous, however, and goods returned to smaller street 
vendors are probably not going to justify this extra expense 
and effort. 
 
¶6. (SBU) Comment:  The position of the Turkish courts is 
 
ANKARA 00001843  002 OF 002 
 
 
legally correct - in the absence of a crime, the state has no 
legal right to deprive individuals of property.  As the only 
reason there is no crime is because of the GOT's own inability 
to fix a technical legal problem by a known deadline, however, 
the GOT should be more willing to work out an equitable 
solution that does not allow counterfeit goods back onto the 
market.  Post will continue to raise this issue with GOT 
interlocutors, especially as we begin discussions with them on 
this year's Special 301 process. End comment.