Intellectual Property Protection
The Dominican Republic has had intellectual property rights laws since 1911. It is also a member of the Paris Convention, and most recently, as a member of the WTO, subscribed to the Uruguay Round Agreements, including TRIPs. However, serious problems of enforcement remain. Since the 1980's, owners of pharmaceutical products have been subject to the violation of their registered patents through the marketing, distribution and sale of copies of patented products. The Ministry of Health continues to approve numerous products which contain active ingredients under patent protection.
Additionally, on October 1, 1998, an Intellectual Property Rights bill was introduced to Congress by the Executive, directed toward adapting Dominican legislation to TRIPs requirements. If approved, the bill will contravene several provisions of multilateral agreement. Among the deficiencies identified are:
The Government, despite prior examination of the product or process patent, will not guarantee the validity of the Patent Certificate;
A Patent Certificate can be annulled without the need for declaration or revision by any administrative or judicial authority;
The inclusion of compulsory licenses which operate automatically 180 days after a petition is made, in violation of patent owner rights and without an obligation for the licensee to fulfill technical and economic requirements. Furthermore, the compulsory license would be issued irrespective of whether or not the patent holder is using the patent.
An encouraging note however, is the July 16, 1998, judgment by the Supreme Court, the first -ever decision regarding the violation of patent rights. The decision clearly states that the Patent Certificate issued by the Department of Industry and Commerce has the guarantee of the Dominican Government. Consequently, only the title holder and / or whomever he designates, is authorized to commercialize a product under said patent. The judgment is of great importance, as it ratifies the protection enjoyed by patent owners as stated in the Constitution and Law 4994 of 1911.
Law 173 on exclusive distribution creates excessive protection for the local dealer by awarding unreasonable indemnification rights in cases of unilateral termination by the foreign grantor. Local distributors have no incentive to pursue aggressive distribution of the goods they represent, since a poor performance on their part does not invalidate the indemnification considered in the law. Additionally, court decisions have tended to favor local distributors, to the detriment of foreign companies.
Potential Exports/Foreign Sales
PhRMA member companies in the Dominican Republic estimate that, if trade barriers were removed, exports could increase by US $ 50 to US $ 100 million dollars.
For all the aforementioned reasons, PhRMA believes that the Dominican Republic should be listed as a Watch Country under Special 301 in 1999.