<html><body style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space; "><div apple-content-edited="true"><span class="Apple-style-span" style="border-collapse: separate; color: rgb(0, 0, 0); font-variant: normal; letter-spacing: normal; line-height: normal; orphans: 2; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-border-horizontal-spacing: 0px; -webkit-border-vertical-spacing: 0px; -webkit-text-decorations-in-effect: none; -webkit-text-size-adjust: auto; -webkit-text-stroke-width: 0px; "><div style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space; "><span class="Apple-style-span" style="border-collapse: separate; color: rgb(0, 0, 0); font-variant: normal; letter-spacing: normal; line-height: normal; orphans: 2; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-border-horizontal-spacing: 0px; -webkit-border-vertical-spacing: 0px; -webkit-text-decorations-in-effect: none; -webkit-text-size-adjust: auto; -webkit-text-stroke-width: 0px; "><div style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space; "><div><i>Insert comment on priorities here...</i></div></div></span><br class="Apple-interchange-newline"></div></span><br class="Apple-interchange-newline"> </div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><span style="font-size: 10pt; "><a href="http://insidetrade.com/201204182396245/WTO-Daily-News/Daily-News/us-colombia-side-deal-on-ipr-treaties-allowed-fta-implementation-to-go-forward/menu-id-948.html" style="color: blue; text-decoration: underline; ">http://insidetrade.com/201204182396245/WTO-Daily-News/Daily-News/us-colombia-side-deal-on-ipr-treaties-allowed-fta-implementation-to-go-forward/menu-id-948.html</a><o:p></o:p></span></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><span style="font-size: 10pt; "><o:p> </o:p></span></div><p class="MsoNormal" style="margin-top: 3pt; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 16.5pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; position: static; z-index: auto; "><b><span lang="EN-GB" style="font-size: 15pt; font-family: Arial, sans-serif; color: black; ">U.S.-Colombia Side Deal On IPR Treaties Allowed FTA Implementation To Go Forward<o:p></o:p></span></b></p><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 19.2pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">Posted: April 18, 2012<o:p></o:p></span></div><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">The Obama administration late last week struck a side deal with the Colombian government that cleared the way for the U.S.-Colombia free trade agreement to enter into force on May 15 even though Colombia has not formally completed all steps necessary to comply with its FTA obligations, according to informed sources.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">The side deal outlines punitive steps that the U.S. can take if Colombia does not fulfill in the near term its remaining obligations, which relate to its ratification of three intellectual property rights (IPR) treaties.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">Colombia is required to ratify those three IPR treaties under the terms of the FTA, but has not yet done so because its Constitutional Court has not yet completed its review of the treaties. The court is not expected to complete its work until the second half of this year, presenting an obstacle when it comes to swift implementation of the FTA because Colombia cannot formally ratify the treaties until the court rules they are consistent with the Colombian law.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">To get around this problem, the U.S. and Colombia have negotiated a side deal under which the U.S. has agreed to move forward with FTA implementation in exchange for an agreement from Colombia that if it does not ratify the treaties in the near term, the U.S. can impose unspecified sanctions against Colombian imports. This is an apparent attempt by the U.S. to ensure Colombia fulfills its FTA obligations relatively quickly.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">The side deal, confirmed in an April 15 exchange of letters between U.S. Trade Representative Ron Kirk and Colombian Foreign Minister Maria Angela Holguin, states that the U.S. may “withhold and/or suspend” the application of benefits to Colombia under the FTA to such an extent as the U.S. deems appropriate if Colombia does not ratify the three IPR treaties by certain dates, sources said.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">Under the side deal, Colombia must ratify the Budapest Treaty on the International Recognition of the Deposit of Microorganisms for the Purposes of Patent Procedure of 1977, as amended in 1980, by Jan. 31, 2013, sources said.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">The side deal stipulates that the remaining two treaties -- the International Convention for the Protection of New Varieties of Plants of 1991, known as UPOV 91, and the Convention Relating to the Distribution of Program-Carrying Signals Transmitted by Satellite of 1974 -- must be ratified by April 15, 2013, sources said.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">If the U.S. does end up imposing such sanctions due to a lack of action on the Colombian side, the side deal clarifies that it would promptly remove them once Colombia ratifies the three IPR treaties, sources said.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">The side deal appears to give Colombia ample time, as most observers believe the court can complete its review of the constitutionality of the treaties this year. After that, Colombia must submit its instruments of acceptance to formally ratify them, sources said.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">However, the deal notes that, in the case of the UPOV 91 treaty, even after approval by the constitutional court the government of Colombia may need to take “further steps” in consultation with the treaty's governing council to complete its ratification process, sources said.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">Under the deal, Colombia is required to update USTR every 60 calendar days of its efforts to complete the ratification process of the three treaties. The exchange of letters confirming the side deal is distinct from the exchange of letters stating that the FTA will take effect on May 15, sources said.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">In the event that the Constitutional Court fails to issue a positive determination for any of the three treaties, the side deal stipulates that Colombia will take steps immediately to “remedy any deficiency that is identified” and will continue informing the United States regarding its progress in accordance with the 60-day notification requirement.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">This is not the first time that USTR has opted to allow FTA implementation to go forward even though an FTA partner has not taken all the necessary steps called for under that FTA. In fact, the side deal with Colombia resembles an earlier arrangement the U.S. worked out with Costa Rica to facilitate the implementation of the Central American Free Trade Agreement (CAFTA).<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">Under that deal, the U.S. allowed Costa Rica to implement the trade deal even though it had not passed all IPR-related laws necessary to uphold its FTA obligations, but reserved the right to impose trade sanctions in the event of non-compliance. When Costa Rica exceeded the agreed-upon time period for compliance, the U.S. ultimately blocked sugar imports from Costa Rica until it made the necessary legislative changes on IPR (<a href="http://insidetrade.com/Inside-US-Trade/Inside-U.S.-Trade-05/28/2010/us-to-restore-duty-free-access-for-costa-rican-sugar-in-june/menu-id-710.html" style="color: blue; text-decoration: underline; "><i><span style="color: black; ">Inside U.S. Trade</span></i><span style="color: black; ">, May 28, 2010</span></a>).<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">House Ways and Means Ranking Member Sander Levin (D-MI), who voted against the FTA in October,<b> </b>this week acknowledged that Colombia still needs to complete the constitutional court reviews for the three treaties, but he downplayed the notion that this posed a real hurdle when it comes to FTA implementation.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 15pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">"We discussed that when we were [in Colombia last week], and the answer was in 95 percent of the cases, the court approves, so there's high confidence that that will happen," he said during an April 16 press conference with reporters.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top: 1.5pt; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; line-height: 11.25pt; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span lang="EN-GB" style="font-size: 9pt; font-family: Arial, sans-serif; color: black; ">At that press conference, however, Levin signaled that he was not satisfied with Colombia's implementation of the bilateral labor action plan, which was politically linked to passage of the FTA (<a href="http://insidetrade.com/201204172396122/WTO-Daily-News/Daily-News/levin-not-satisfied-with-colombias-action-plan-efforts-but-avoids-criticizing-obama/menu-id-948.html" style="color: blue; text-decoration: underline; "><span style="color: black; ">see related story</span></a>).</span></p></body></html>