From CRYENGINE 3.4.3 and on the localization files have moved from
You can set the sys_localization_folder CVar to "Languages" to use the old system. In 3.4.3 and onwards, it is set to "Localization" by default which will make it use the new structure.
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Inside certain scripts shipped with the SDK, you'll find references to localization strings. One example can be found in the InteractiveEntity object: