US embassy cable - 04AMMAN460

UNCLAS SECTION 01 OF 03 AMMAN 000460 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR NEA/ARN 
PASS TO USTR - E. SAUMS 
USDOC 4520/ITA/MAC/ONE/PTHANOS 
USDOC ALSO FOR NAOMI WIEGLER 
 
E.O. 12958: N/A 
TAGS: ETRD, ECON, KIPR, JO 
SUBJECT: AMBASSADOR RAISES TRADE ISSUES WITH DPM HALAIQA 
 
REF: STATE 341991 
 
SENSITIVE BUT UNCLASSIFIED.  THIS MESSAGE CONTAINS COMPANY 
PROPRIETARY INFORMATION.  FOR USG USE ONLY.  PROTECT 
ACCORDINGLY. 
 
1.  (SBU)  SUMMARY:  Ambassador Gnehm joined by Economic 
Officer called on Deputy Prime Minister and Minister of 
Industry and Trade Mohammad Halaiqa December 31 to review 
outstanding trade issues.  Securing a date for the FTA Joint 
Committee meeting was a top issue.  DPM Halaiqa assured the 
Ambassador that agreement on Israeli content in QIZ products 
was achievable and imminent, hinting that the 8 percent 
figure would be continued.  In a three-way discussion with 
the National Library director general, a number of tortuous 
copyright and IPR issues were quickly ironed out by DPM 
Halaiqa.  On a bilateral Government Procurement Agreement, 
Halaiqa said that Jordan did not have the resources to pursue 
one now and would focus on the WTO agreement only. Halaiqa 
said that he would look into problems raised about a U.S. 
pharmaceutical company's complaint regarding a product's 
licensing for generic production and about the DAMAN 
pre-shipment inspection program.  The Deputy Prime Minister 
expressed enthusiasm to be kicking off the January 11-13 Iraq 
OUTREACH 2004 trade show.  END SUMMARY. 
 
JC Meeting 
---------- 
 
2.  (SBU)  In a meeting at the Ministry of Industry and Trade 
(MOIT), the Ambassador opened with a discussion of 
preparations for the OUTREACH 2004 trade show and the large, 
senior-level U.S. delegation attending.  Halaiqa said that he 
was ready to open the show and enthusiastic to be 
participating.  The Ambassador turned to the next meeting of 
the FTA Joint Committee.  DPM Halaiqa said that he was 
generally open to dates in March or April, except for two 
periods in March when he would participate in meetings with 
the Arab League and in Morocco.  (NOTE:  A convenient time 
might be at the beginning of April, just before the planned 
"Destination Baghdad Expo" in Baghdad, currently slated to be 
held April 5-8.  END NOTE.) 
 
QIZ Agreement with Israel 
------------------------- 
 
3.  (SBU)  The Ambassador inquired about GOJ-Israeli 
negotiations on the percentage of Israeli content required in 
products from Qualifying Industrial Zones (QIZs) to have 
duty-free access to the U.S. market.  The Ambassador 
expressed some concern that an agreement had not been reached 
to date given that the required Israeli content is scheduled 
to roll back to 11.7 percent from the current 8 percent on 
February 4.  DPM Halaiqa responded that an agreement was 
achievable before the February 4 deadline and that he hoped 
to conclude it when Israeli DPM Ehud Olmert visited in late 
January.  Halaiqa said that all indications pointed to having 
a final agreement by that time.  The Ambassador asked whether 
the lack of certainty about required Israeli content 
remaining at 8 percent was an impediment to QIZ factories 
securing new business.  Halaiqa responded that he was hopeful 
the content percentage would remain the same as Jordanian 
factories could not otherwise remain competitive.  At the 
same time, the GOJ had to keep the negotiations low profile, 
he maintained, because they were highly influenced by the 
political situation.  (NOTE:  As we are reporting septel, 
Halaiqa's planned meeting with Olmert may be subsequently 
been delayed.) 
 
Copyright and IPR Issues 
------------------------ 
 
4.  (SBU)  On the GOJ's Copyright Law, the Ambassador noted 
that in recent USAID discussions with Minister of Planning 
Bassem Awadallah, the GOJ had agreed in principle to seek 
Parliament's approval of amendments to the law to make it 
consistent with relevant FTA obligations.  The MOP had also 
agreed to ask the MOIT to develop an action plan, due June 
30, to outline specific measures  to ensure accession to the 
Patent Cooperation Treaty and to the Madrid Agreement on 
International Registration of Marks by the end of 2004.  The 
Ambassador asked to see the action plan when it was ready. 
Halaiqa responded that the agreement between USAID and the 
MOP was acceptable to him and that the MOIT would do its best 
to be responsive. 
 
5.  (SBU)  The Ambassador inquired about a series of 
questions on the Copyright law that the Embassy sent to the 
MOIT on December 16 (Reftel).  A written response would be 
forthcoming, said Halaiqa, who asked Mahmoun Talhouni, 
Director General of the National Library, to join the meeting 
to review progress on copyright issues.  (NOTE:  In an 
earlier meeting with Econoff, Talhouni gave assurances that 
he was consulting with the MOIT and would seek an additional 
4-5 amendments to the Copyright Law to meet commitments in 
the FTA, but had expressed reservations about addressing 
certain points in Reftel.  END NOTE.) 
 
6.  (SBU)  Referring to the list of points in Reftel, 
Talhouni said that Article 4(12) of the FTA would require 
more time to study and to adopt an appropriate solution 
regarding exclusive rights to communicate phonograms by wired 
or wireless means.  In a brief, to-the-point exchange, DPM 
Halaiqa asked Talhouni to finish the review as soon as 
possible, not later than January 31. 
 
7.  (SBU)  Talhouni insisted that the current provisions on 
anti-circumvention devices in Article 55 of the Copyright Law 
met all of the GOJ's FTA obligations, and that the GOJ's 
written response would explain this in detail.  Econoff noted 
that it was unclear whether the legal community would share 
this assessment and asked that the GOJ make public its 
interpretation of Article 55.  Halaiqa agreed that a publicly 
available GOJ interpretation would allow all to see the 
government's intent regarding the provision on 
anti-circumvention devices. 
 
8.  (SBU)  Talhouni then deflected an exchange on Article 
51(a)(2) of Jordan's Copyright Law by noting that it was 
covered in the law's Article 53.  Econoff asked that the GOJ 
specifically address Article 51(a)(2) as noted in the written 
points the USG submitted.  DPM Halaiqa assured the Ambassador 
that the GOJ would comply with the FTA in Article 51(a)(2) by 
inserting language making it applicable to sound recordings 
and performances. 
 
9.  (SBU)  On government use of computer software, Econoff 
noted that some measures needed to be taken to address this 
point.  After a brief exchange on the GOJ's standing 
agreement with Microsoft (COMMENT: which we view as too 
narrow), DPM Halaiqa agreed to the Ambassador's suggestion 
that the GOJ issue a circular throughout GOJ government 
offices stating that all government agencies use only 
computer software authorized for its intended use. DPM 
Halaiqa subsequently told the Ambassador that he had put in 
motion a government initiative to circulate such a notice. 
 
10.  (SBU)  NOTE:  The GOJ sent a letter to the embassy on 
January 5 giving a written response to Reftel points.  The 
letter, however, seemed to have been drafted prior to the 
Ambassador's meeting and did not fully relflect the 
conversation there.  (Embassy is faxing a copy to NEA/ARN.) 
Econoff has asked the MOIT Foreign Trade Policy section to 
take note of the clarifications made at the December 31 
meeting with DPM Halaiqa.  The Ambassador will be following 
up with a letter to DPM Halaiqa, noting in writing these 
clarifications.  END NOTE. 
 
Government Procurement Agreement 
-------------------------------- 
 
11.  (SBU)  DPM Halaiqa told the Ambassador that the GOJ 
would not pursue a bilateral GPA, but was focusing instead on 
meeting WTO obligations regarding GP.  It would be difficult 
to pursue the U.S.-GOJ GPA on a parallel track, he said, 
explaining that the GOJ does not have enough resources. 
Halaiqa said that he understood that the USG only intended to 
be helpful in suggesting a bilateral agreement. 
 
Pharmaceutical Company Complaint 
-------------------------------- 
 
12.  (SBU)  The Ambassador raised his earlier letter on 
behalf of U.S. pharmaceutical company Merck Sharp and Dohme, 
which is contesting the Jordan Food and Drug Administration's 
(JFDA) licensing to a local generic company of its 
weekly-dosed FOSAMAX product.  MSD brought the case to court, 
contending that its data file on this once-weekly compound to 
prevent osteoporosis is not yet in the public domain (unlike 
the daily dose), and that the JFDA acted contrary to it 
mandate to keep such data private until a five-year license 
period elapses in 2006.  The Ambassador stressed that this 
matter should have been solved through regulatory relief, not 
a costly court case brought by MSD.  DPM Halaiqa acknowledged 
that the outcome was not satisfactory, but noting that the 
law gave JFDA a wide mandate, said the agency may be at 
fault, and the decision would need to be reviewed.  In the 
meantime, said Halaiqa, he understood USG concerns, had 
written on MSD's behalf before, and would talk about it again 
with concerned authorities.  (NOTE:  Since the meeting, the 
court has dismissed MSD's case and the local generic product 
is reportedly on the market. END NOTE.) 
 
DAMAN Pre-Shipment Inspection Program 
------------------------------------- 
 
13.  (SBU)  The Ambassador raised lack of national treatment 
as one more reason why this issue continues to be an irritant 
in our trade relations.  If Jordan's domestic industries are 
not required to register their products and subject them to 
potential inspection, why should U.S. companies do so in 
order to export to Jordan?  It denies or limits opportunity 
to our companies, he added.  DPM Halaiqa said that the 
program was initiated by Dr. Ahmad Hindawi, DG of the Jordan 
Institute of Standards and Metrology (JISM).  The emphasis 
was on goods from the Far East, he said.  Nonetheless, he 
would look into it and if DAMAN proved to be a trade barrier, 
he would take action. 
 
14.  (SBU)  COMMENT:  DPM Halaiqa was quick to address the 
gist of our concerns and upbeat about the bilateral trade 
relationship.  That he had to call in the National Library 
Director to try to resolve pending bilateral copyright and 
IPR problems -- which the DPM tackled quickly and efficiently 
-- may be a sign that the DG is not long in his position, 
newly moved to the MOIT from the Ministry of Culture in the 
last cabinet reshuffle. 
GNEHM