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(NAR) VOL. 19 NO. 2 / APRIL - JUNE 2008

[ , November 21, 2007 ]

OMB RULES OF PROCEDURE



WHEREAS, IT IS A DECLARED STATE POLICY TO ENSURE THE PROTECTION AND PROMOTION OF INTELLECTUAL PROPERTY RIGHTS;

WHEREAS, the unregulated sale, rental, distribution, mastering, manufacture, replication, duplication, importation and exportation of optical media products in all forms is, inimical to economic growth and public interest;

WHEREAS, there is a need for the State to institute means to regulate the manufacture mastering, replication, importation and exportation of optical media manufacturing matena or equipment, including parts, accessories and paraphernalia;

WHEREAS, the Optical Media Board is empowered to hear and resolve administrative cases for violations of Republic Act No. 9239 and its Implementing Rules and Regulations and impose the necessary administrative penalties;

WHEREFORE, pursuant to Sections 10 (g) and (n), 23, and 34 of Republic Act No. 9239, otherwise known as the "Optical Media Act of 2003," the following rules of procedure to govern administrative proceedings are hereby adopted."

RULE I
Title and Preliminary Matters

Section 1. Title- These Rules shall be cited as the OMB Rules of Procedure.

Section 2. Coverage. These Rules shall apply to administrative cases for violations of Republic Act No. 9239 and/or its Implementing Rules and Regulations.

Section 3. Construction. These Rules shall be liberally construed to carry out the objectives of Republic Act No. 9239 and its Implementing Rules and Regulations promulgated pursuant thereto.

In implementing these Rules, the Board shall observe proper flexibility and avoid undue technicality with the end in view of bringing forth the truth and meting out justice as fairly and expeditiously as possible.

Section 4. Suppletory Application of the Rules of Court. The Rules of Court shall apply in a suppletory character.

RULE II
Definition of Terms

Section 5. Definitions. As used in these Rules, the following terms shall mean:

a)
"Act" - Republic Act No. 9239 or the "Optical Media Act of 2003";
 
b)

"Board" - the body of the Optical Media Board composed of four (4) ex-officio members and five (5) regular members appointed by the President;

 
c)
"Complainant" - the person who initiated the complaint who may be a private person or any employee, personnel, officer, agent, or inspector of the Optical Media Board;
 
d)
"Duplication" - the process of manufacturing optical media by reproducing or generating copies by burning through the use of disc writers and other duplicating devices;
 
e)
"RR" - the Implementing Rules and Regulations of Republic Act No. 9239 or the Optical Media Act of 2003 including the Annexes thereto;
 
f)
"IP Code" - Republic Act No. 8293 also known as the Intellectual Property Code of the Philippines;
 
g)
"License" - the authority granted by the OMB to establishments or entities registered with it to engage in the business of mastering, manufacture, replication, importation or exportation of optical media;
 
h)
"Magnetic Media" - a storage medium or device characterized by a base, usually plastic, coated with ferric oxide powder, in which visual and/or aural information, or software code, may be recorded or stored, including, but not limited to, maqnetic tape, cassettes, video tape, diskettes, and floppy discs;
 
i)
"Manufacture" - the act or business of producing optical media or devices contain' sounds and/or images, or software code, including any work protected in Part IV of the IP Code, by mastering and/or replication. In relation to equipment, "manufacture" shall refer to the assembly or integration of various components into any equipment useful for the mastering, manufacture and/or replication of optical media;
 
j)
"Manufacturing Equipment" - any and ail equipment, machine or device, now known o to be known in the future, intended or designed for the production or manufacture by duplication, mastering and/or replication of optical media, optical media masters or production parts thereof, including but not limited to, those which are listed in the IRR of the Act or are prescribed by the OMB. For the purpose of these Rules, optical disc writers and such other devices used for commercial activities are considered as manufacturing equipment;
 
k)

"Manufacturing Material" - any material such as, but not limited to, optical grade polycarbonate or polycarbonate substitutes with physical properties suitable for the manufacture of optical media and shall include rewritable and/or recordable discs;

 
I)
"Mastering" - the act or business of producing a stamper made of glass, metal or other material, intended for the manufacture of optical media;
 
m)
"OMB" - the Optical Media Board as a government agency;
 
n)
"Optical Media" - a storage medium or device in which information, including sounds and/or images, or software code, has been stored, either by mastering and/or replication, which may be accessed and read using a lens scanning mechanism employing a high intensity light source such as a laser or any such other means as may be developed in the future. The term shall include, but not limited to, devices which shall be listed in the IRR of R.A. No. 9239, or as prescribed by the OMB;
 
o)
"Replication"-the process of manufacturing optical media by reproducing or generating copies of the stamper in an injection molding machine or other forms of replicating equipment;
 
p)
"Respondent"-the person against whom a complaint was filed; and
 
q)
"Source Identification Code or SID Code" - a system of codes to identify the source of every optical media mastered, manufactured or replicated by any establishment or entity.

RULE III
Procedure in Administrative Cases

Section 6. Parties. Any person, natural or juridical, who has cause to complain about any violation of R.A. No. 9239 or the IRR promulgated pursuant thereto, may file a written complaint with the Board through the Legal Services Division of the OMB against person or establishments charged with such violation. The former shall be considered as the complainant, and the latter, as the respondent.

Section 7. Appearances. In all proceedings before the duly constituted Hearing Committee or a duly appointed Commissioner, it is preferred that the parties be represented by counsel who is a member of the Philippine Bar duly authorized to practice law in the country, provided however, that a party may appear before the Hearing Committee or Commissioner by and for himself.

Section 8. Complaint. There are two (2) types of complaints that may be filed.

The first type is that initiated by a complaining party against a particular respondent for violations of the Act or its IRR.

The second type is that initiated by an agent, officer, inspector and/or deputy of the OMB as a result of an inspection order.

Complaints filed by a complaining party independent of an inspection must comply with the following:

a)
The complaint shall be in writing and verified, in set of four (4) copies for the board and of as many other copies as there are respondents.
 
b)
It shall state complainant's name and address.
 
c)
It shall likewise state the name and address of the respondent. If the respondent cannot be identified by his name, an assumed name may be used together with the practical description of respondents physical appearance such as but not limited to gender, approximate age, weight, height, color of hair, and other distinguishing physical appearance. A respondent identified by an assumed name shall be required to provide his true name in order for him to participate in the proceedings and the complaint shall be considered as amended accordingly.
 
d)

The complaint must contain the violation committed, a statement of ultimate facts constituting the violation, and all supporting evidence available.


Section 9. Complaint served during inspection, a) If during an inspection conducted by authorized personnel of the OMB in accordance with Section 10 (d) of the Act or Rule 6, Title H, of the IRR, there is reasonable ground to believe that a violation of the Act or its IRR has been committed, is being committed or is about to be committed, the inspection officer, agent, inspector, or deputy of the OMB shall then and there prepare a written complaint against the person and/or establishment inspected.

The written complaint shall be in set of two (2) copies, one set to be served upon the respondent during the actual inspection, which complaint need not be verified.

A detailed receipt of the items taken into preventive custody shall likewise be issued to the owner and/or the person in actual possession or control of said items, together with a notice to answer the complaint within a non-extendible period of five (5) days from receipt thereof. The complaint, the detailed receipt, and the notice to explain may be contained in one written instrument.

b) Should the said person refuse to receive a copy of the complaint and/or the detailed receipt of the items taken in preventive custody and/or the notice to answer, the serving officer shall leave copies of these documents in the premises where the items were seized.

The same procedure shall apply when the place inspected is abandoned and no one claims ownership of the items to be taken into preventive custody.

c) Within a reasonable period after the service of the complaint and notice to answer to the respondent, in no case more than five (5) days, the serving officer shall verify the said complaint before a notary public or a designated subscribing officer and shall file the same with the Legal Services Division of the OMB together with the copy of the complaint duly received by respondent or properly left in the premises inspected, the detailed receipt of the items taken under preventive custody, and all other supporting evidence.

For this purpose the Chairman, in his absence the Executive Director, are designated as subscribing officers before whom the complainant may appear and verify the complaint

d) The verified complaint and sworn statements of the witnesses shall serve as their direct testimony.

e) The power of the OMB to conduct inspections shall not be limited by this Section.

Section 10. Action on the Complaint. a) Upon receipt by the Legal Services Division of the OMB of the complaint, it shall evaluate the same. If the complaint is not sufficient in form, the Legal Services Division of the OMB shall order the complainant to amend his complaint. Failure to make the necessary amendments shall be sufficient grounds for the dismissal of the complaint, in which case the said office shall make the necessary recommendations to the Hearing Committee or the Commissioner to prepare a written order of dismissal for the approval and signature of the Chair.

b) If the complaint is sufficient in form, and in cases not arising from an inspection conducted by the personnel of the OMB, the Legal Services Division of the OMB shall issue a notice to respondent requiring him to file his verified answer within a non-extendible period of five (5) days.

A copy of the complaint and all other supporting documents and evidence shall be attached to the notice.

In cases of voluminous documents and/or object evidence, the same need not be attached to the notice provided however that the respondent is allowed to examine these voluminous documents and/or object evidence and make copies or photograph the same within the period to file the answer.

c) If a complaint is filed by the authorized personnel of the OMB in accordance with Section 9 hereof, the period to file the answer shall commence on the date when a copy of the complaint was served on the respondent or was left in the premises inspected.

d) Upon receipt of the last pleading filed, or upon expiration of the period to file the same, the Legal Services Division of the OMB shall forward the records of the matter to the duly constituted Hearing Committee or Commissioner as the case may be, for proper proceedings.

Section 11. Answer, a) The answer shall be verified. It must be in writing and must contain all material facts and applicable laws, including legible copies of all documentary evidence and sworn statements of witnesses. Defenses not contained in the answer are deemed waived.

b) The verified answer of the respondent and sworn statements of his witness shall be considered as their direct testimony.

Section 12. Personal knowledge, expertise, and competence. The parties and their witnesses shall state only matters of which they have personal knowledge, or of which they have expertise.

Section 13. Failure to File Answer, a) If the respondent fails or refuses to file his answer, he shall be deemed to have waived his right to file the same and the duly constituted Hearing Committee or Commissioner, as the case may be, shall proceed to resolve the matter based on the evidence on record.

b) If the answer filed is not verified, the respondent is allowed to verify the same within the period remaining of the five (5) days for filing of the answer.

c) Answers which are not verified shall be considered as unsigned and motu proprio or upon motion by an interested party, shall be expunged from the records.

Section 14. Reply. The complainant may opt to file his reply within five (5) days from receipt of the verified answer. The reply need not be verified.

RULE IV
Summary Procedure

Section 15. Evaluation. If on the basis of the pleadings, documents and evidence submitted by the parties the duty constituted Hearing Committee or a duly appointed Commissioner, as the case may be, find no sufficient cause to warrant further proceedings, the complaint shall be dismissed. A written order of dismissal shall be prepared and transmitted to the Chair for his approval and signature.

Otherwise, the parties shall be summoned to a preliminary conference to consider the following matters:

a) Whether the parties are amenable to submitting the case for resolution on the basis of the complaint, answer, evidence on record and such other evidence, pleadings, position paper or memorandum as may be submitted during or after the preliminary conference;

b) Whether the parties desire further proceedings to determine the nature of the charge, stipulation of facts, definition of the issues, identification and marking of exhibits, waiver of objections to admissibility of evidence, limiting the number of witnesses, names of witnesses, and such other matters as may aid in the prompt and just resolution of the case;

c) Whether there is a need for clarificatory hearings or dispensing with the cross-examination of the complainant, respondent, or their witnesses; and

d) Hearing dates,

Section 16. Hearings, a) Unless determined by the Chair to be necessary and a written order to that effect is promulgated, no hearing is required and the case will be resolved based on the pleadings and evidence on record.

At this stage, the duly constituted Hearing Committee or Commissioner, as the case may be, at their discretion and for the purpose of making such determination, hold 8 clarificatory hearing and propound clarificatory questions to the parties and/or their witnesses9 under oath, to further elicit facts and relevant information.

b) In case hearings are held, only those witnesses who have submitted their affidavits on or before the preliminary conference or at a specified date shall be allowed to testify The affidavit of any witness shall constitute his direct testimony, subject to cross-examination by the other party. In the cross-examination of witnesses, only relevant, pertinent and material questions necessary to enlighten the duiy constituted Hearing Committee or a duly appointed Commissioner shall be allowed.

c) The hearings shall be conducted without necessarily adhering strictly to the technical rules of procedure and evidence applicable to judicial proceedings.

Section 17. Who may conduct hearings, a) Hearings may be conducted by the duly constituted Hearing Committee or by an appointed Commissioner, and any hearing conducted by either of these body/individual are deemed as a hearing before the Board.

b) At the start of every calendar year, the Chair shall constitute a Hearing Committee composed of him or in his absence the Executive Director, who shall be the presiding officer, the head of the Legal Services Division, and a Board Member from the private sector as determined by the Chair.

c) In cases where it is impractical to constitute a Hearing Committee owing to the lack of appointees available, and in the interest of justice and speedy disposition of cases, the Chair is authorized to appoint a Commissioner in lieu of a Hearing Committee, who must be a member of the Legal Services Division of the OMB preferably a member of the Philippine Bar duly authorized to practice law in the country. The Executive Director may likewise be appointed as a Commissioner.

The Commissioner shall conduct the hearing for the Hearing Committee and accordingly renderthe decision.

d) All decisions, orders, judgments, resolutions issued by the Hearing Committee or the Commissioner shall be approved and signed by the Chair before it is promulgated.

Section 18. Role of the duiy constituted Hearing Committee or Commissioner. The duly constituted Hearing Committee or Commissioner, as the case may be, shall personally conduct the conference and/or hearings.

It/He shall determine the order of presentation of evidence by the parties, subject to the requirements of due process.

It/He shall take full control of the proceedings, examine the parties and their witnesses to satisfy it/him with respect to the matters at issue, ask questions only for the purpose of clarifying points of law or fact involved in the case.

It/He shall limit the presentation of evidence to matters relevant to the issue before it/ him and necessary for a just and speedy disposition of the case.

Section 19. Subpoena. Upon application with the Legal Services Division of the OMB by either party and on meritorious grounds, a subpoena ad testificandum and/or subpoena duces tecum may be issued by the Hearing Committee or Commissioner, to compel the attendance of witnesses and production of documents and other effects.

Section 20. Presumptions. Unless rebutted, the following presumptions shall apply:

a) Any optical media and/or manufacturing materials or equipment, including parts, ac cessories and paraphernalia found in the custody, use, possession or control of any per son, establishment or entity engaged in: 1) importation, exportation, sale, distribution, rental, or any commercial purpose of optical media, 2) importation, exportation, acquisition, sale or distribution of manufacturing equipment, parts and accessories, and manufacturing materials used or intended for use in the mastering, manufacture or replication of optical media, 3) possession or operation of manufacturing equipment, parts and accessories, 4) possession, acquisition, sale or use of manufacturing materials for the mastering, manufacture or replication of optical media, 5) mastering, manufacture or replication of optical media, or 6) offering to the public with intent to profit the use of optical disc writers and rewriters, without first being registered with the OMB, or without valid registration with the OMB, shall be presumed to have been imported, exported, acquired, sold, rented, distributed, possessed, operated, used, mastered, manufactured, replicated, or offered, as the case may be, in violation of the Act.

b) Any optical media and/or material or equipment, including parts, accessories and para phernalia found in the custody, use, possession or control of any person, establishment or I entity engaged in: 1) importation, exportation, sale, distribution, rental, or any commercial | purpose of optical media, 2) importation, exportation, acquisition, sale or distribution of manufacturing equipment, parts and accessories, and manufacturing materials used or intended for use in the mastering, manufacture or replication of optical media, 3) possession or operation of manufacturing equipment, parts and accessories, 4) possession, acquisition, sale or use of manufacturing materials for the mastering, manufacture or replication of optical media, 5) mastering, manufacture or replication of optical media, or 6) offering to the public with intent to profit the use of optical disc writers and rewriters, without first securing the appropriate commercial license or licenses issued by the OMB, or without a valid license issued by the OMB, shall be presumed to have been imported, exported, acquired, sold, rented, distributed, possessed, operated, used, mastered, manufactured, replicated, or offered, as the case may be, in violation of the Act.

c) Any optical media and/or material or equipment, including parts, accessories and para phernalia found in the custody, use, possession or control of any person, establishment or entity which refused to submit to any inspection being conducted by authorized personnel of the OMB, or refused to comply with a preventive custody order, or refused to surrender to the OMB for preventive custody, shall be presumed to have been imported, exported, acquired, sold, distributed, possessed, operated, used, mastered, manufactured, replicated, or offered, as the case may be, in violation of the Act.

d) Any optical media and/or material or equipment, including parts, accessories and para phernalia found in the custody, use, possession or control of any person, establishment or entity engaged in the mastering, manufacture, replication or duplication of optical media containing intellectual property, which failed to show during inspection conducted by authorized personnel of the OMB, or when required to do so, the authority or consent of the owner thereof or his duly authorized representative to master, manufacture, replicate duplicate optical media, as the case may be, shall be presumed to have been operated used, mastered, manufactured, replicated or duplicated, as the case may be, in violation of the Act.

e) Any mastering, stamping, or mould equipment that do not bear, carry or incorporate any Source Identification Code (SID) or which bears, carries or incorporates a false, falsified, imaginary or unauthorized SID shall be presumed to have been used or intended to be used in violation of the Act.

f) Any optical disc manufactured, mastered, replicated in and/or exported from the Philip pines, sold, traded, distributed, or possessed for the purpose of sale, trade, distribution or export that does not bear, carry or incorporate any SID or which bears, carries or incorpo rates a false-, falsified, imaginary or unauthorized SID shall be presumed to have been manufactured, mastered, replicated, exported, sold, traded, distributed or possessed, or intended to be so, as the case may be, in violation of the Act.

g) Any person, establishment or entity in possession of optical media shall be presumed to possess the same for "the purpose of sale, rental, distribution or any other commercial purpose" if the person, establishment or entity shall have in its possession at least three (3) pieces of media containing simitar copyrighted content, or at least six (6) pieces of media containing dissimilar copyrighted content.

Section 21. Decision, a) Not later than thirty (30) days upon the case being submitted for resolution, the duly constituted Hearing Committee or Commissioner, as the case may be, shall render its/his decision and thereafter forward the sameto the Chair for his approval and signature. The presiding officer of the Hearing Committee or the Commissioner must prepare a written explanation to be included in the records of the case should the Committee or the Commissioner fail to resolve the case within the prescribed period.

b) Should the Chair agree with the Decision of the Hearing Committee or the Commis sioner, he shall approve the same by affixing his signature thereto. Otherwise, he shall review the records of the case and himself render and promulgate the decision.

c) A decision shall be based on substantial evidence or that amount of relevant evidence that a reasonable mind might accept as adequate to justify a conclusion.

d) Any member of the Hearing Committee may submit a dissenting opinion stating the reasons thereof, which shall be attached to the draft transmitted to the Chair and to the final copy of the decision promulgated.

Section 22. Motion for Reconsideration or New Trial, a) An aggrieved party may file either motion for reconsideration or new trial with the Legal Services Division of the OMB within the period to appeal on any of the following grounds:
1) New evidence has been discovered which materially affects the decision, which evidence were not available at the time the complaint was filed and the administrative case was pending; or

2) Errors of facts and/or law or irregularities have been committed prejudicial to the interest of the movant.
b) Only one motion either for reconsideration or new trial shall be allowed. Upon receipt of the said motion, the Legal Services Division of the OMB shall forward the same to the duly constituted Hearing Committee or the duly appointed Commissioner, as the case may be, who shall accordingly resolve the matter.

In cases where it was the Chair who personally prepared and promulgated the decision, the motion for reconsideration and/or new trial shall be resolved by the Chair himself.

c) All resolutions rendered under this section shall be approved and signed by the Chair before it is promulgated.

d) The filing of the motion for reconsideration or new trial shall suspend or stop the running of the period for appeal, and the remainder of such period shall begin to run from the date of receipt by the movant of the denial of the motion for reconsideration or new trial.

Section 23. Period to Appeal. A party adversely affected by the decision may appeal to the Office of the President within thirty (30) days from receipt of the official copy of the decision, deducting the time during which a motion for reconsideration or new trial is pending, which in no case shall not be less than five {5} days.

Section 24. How Taken. The appeal shall be filed directly with the Office of the President, and shall specifically set forth assignment of error/s with reasons, authorities, and precedents relied upon for reversal or modification of the appealed decision, and with notice and copy thereof served to the Legal Services Division of the OMB and the adverse party.

Section 25. Finality. The decision shall become final and executory thirty (30) days after the receipt of a copy thereof by the party adversely affected or his counsel, unless within that period a motion for reconsideration or for new trial is filed or an appeal to the Office of the President. When an appeal is duly filed by either party the decision in the appeal becomes final and executory thirty (30) days after the receipt of a copy thereof by the party adversely affected or his counsel.

RULE V
Offenses and Penalties

Section 26. Administrative Sanctions. Without prejudice to the filing of criminal and civil actions in appropriate cases, the Board may impose administrative penalties, including confiscation of optical media or manufacturing material or equipment, parts, accessories ar>d paraphernalia, in accordance with Title IV of the IRR.

Section 27. Disposal/Return of Seized Materials, a) After the answer has been filed or after the lapse of the proper period with no answer being filed, the Chair in accordance with Section 23 of the Act may order the immediate disposal, and destruction of optical media and/or material or equipment, including parts, accessories and paraphernalia being held preventive custody based on a finding that the said materials have violated the provisions R.A. No. 9239 provided that an accurate and detailed inventory of the quantity of the seized items and a sufficient representative sample is retained for evidentiary purpose the criminal and civil actions that were and/or would be filed.

The Chair may also order the immediate return of the items taken into preventive custody based on the finding that the said materials do not violate any provisions of R.A No. 9239.

Any action on this matter will not prejudice the result of the administrative case

b) Items taken into preventive custody shall be returned to its owner whether he be the respondent or not, upon presentation of verifiable proof of ownership, within thirty (30) days from the date of the taking unless the Chair orders that it remain under the custody of the Board in cases where the appropriate criminal or administrative complaint has been instituted against the person, establishment or entity which appears to be liable for the offense or violation of the Act or the IRR.

d) Orders and/or resolutions relative the disposition of items held in preventive custody is final and immediately executory.

RULE VI
Execution

Section 28. Execution Upon Finality of Decision. Execution shall issue after the decision of the Hearing Committee or the duly appointed Commissioner has become final and executory; provided, however, that execution pending appeal may be allowed in the sound discretion of the Hearing Committee or a duly appointed Commissioner, such as when the appeal is patently dilatory. Execution pending appeal may be stayed upon filing of bond by the losing party in such reasonable amount as may be fixed by the Hearing Committee or the duly appointed Commissioner or upon issuance of a status quo order by the Office of the President.

Section 29. Enforcement of Decision. The decision shall be enforced through writ of execution signed by the Chair and directed to any law enforcement agency that is ordered to enforce the decision.

RULE VII
Fees

Section 30 Docketing Fee. For the filing of a complaint, a private complainant must pay a docketing fee of One Hundred Pesos (P100.00). Government officers filing the complaint by virtue of their official function are exempted from paying the filing fees.

RULE VIII
Other Provisions

Section 31. Applicability of these Rules to Cases Involving Magnetic Media. These Rules shall apply to cases involving magnetic media and where the phrase "optical media product" occurs, the phrase "magnetic media" shall be substituted.

Section 32. Retroactive Application. These Rules shall be applied to all administrative cases pending at the time of the adoption.

RULE IX Final
Provisions

Section 33. Supplementary Rules. The Board, en bane, may from time to time issue such supplementary rules as it may deem fit and necessary.

Section 34. Amendment/Repeal. These Rules may also be amended or repealed by the Board, en bane.

Section 35. Separability Clause. If any section or provision of these Rules is held unconstitutional or invalid, the other provisions not affected thereby shall remain valid and binding.

Section 36. Effectivity. These Rules shall take effect fifteen (15) days following the completion of their publication in the Official Gazette or in a newspaper of general circulation in the Philippines.

Adopted: 21 Nov. 2007

(SGD.) HON. EDUARDO LUIS B. MANZANO
Chairman and Chief Executive Officer

(SGD.) HON. ADRIAN S. CRISTOBAL, JR.
Board Member

(SGD.) HON JOHN P. LESACA
Board Member

(SGD.) HON. VICENTE R. DEL ROSARIO, JR.
Board Member

(SGD.) HON.AUSTEREA. PANADERO
Board Member

(SGD.) HON. MA. ELEANOR F. DELACRUZ
Board Member

(SGD.) HON. MA. TRINIDAD P. VILLAREAL
Board Member

(SGD.) ATTY ROSENDO B. MENESES, JD
Executive Director
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