WTO: 2013 NEWS ITEMS

INTELLECTUAL PROPERTY: FORMAL MEETING

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NOTE:
THIS NEWS STORY is designed to help the public understand developments in the WTO. While every effort has been made to ensure the contents are accurate, it does not prejudice member governments’ positions.

The official record is in the meeting’s minutes.

MORE:
intellectual property (TRIPS)
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TRIPS and health
TRIPS and biodiversity
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MINUTES:

The discussions took place in the WTO’s council dealing with trade-related aspects of intellectual property rights (TRIPS), which, like almost all WTO committees, consists of all WTO members. The meeting also agreed to recommend that the period for countries to accept a TRIPS Agreement amendment related to public health should be extended so that more countries can accept it, and the amendment can take effect (details below).

 

Some details

 

Plain packaging for tobacco      back to top

The latest debate about compulsory plain packaging — using standard colours and typefaces instead of brand logos, usually with large health warnings — for cigarettes and other tobacco products follows an announcement in May 2013 by Ireland that it is considering the requirement among a number of measures designed to discourage smoking and improve health. (See also this October 2013 Irish government report.)

The Dominican Republic urged Ireland to withdraw the policy until a legal challenge against Australia’s plain packaging law is settled in the WTO. It was supported by Cuba, Honduras, and Nicaragua in repeating its concern that the move would violate countries’ right to market products using trademarks and could hurt their producers. Cuba has also referred to geographical indications.

The EU, which speaks for all its member states, pointed out that Ireland’s policy has not taken effect yet, and argued that the TRIPS Agreement allows countries to act to protect public health. Plain packaging is also recommended in the World Health Organization’s Framework Convention on Tobacco Control, it said. Australia, New Zealand, Canada, Norway, and Uruguay supported the EU.

Plain packaging for tobacco was first discussed in the TRIPS Council and in the WTO Technical Barriers to Trade Committee (which deals with labelling and general product standards) in June 2011. Since then it has been debated intensively and is now a full-blown legal dispute.

The first complaints were about Australia’s bill, which subsequently became law. A bill in New Zealand and policies announced in the EU and now Ireland have also been discussed. (See news from the last meeting and follow links to earlier news stories.)

Ukraine launched a legal challenge in March 2012, once the Australian bill became law. Honduras and Dominican Republic filed their complaints in 2012, and Cuba and Indonesia in 2013, bringing the total number of cases to five. It remains to be seen whether the cases will be merged. The only panels set up so far are for the Ukraine case, with one for Honduras set up on 25 September 2013. However, no panellists have been appointed and therefore there have been no hearings. (See disputes DS434, DS435, DS441, DS458, DS467.)

The Irish plan was discussed in this meeting at the request of the Dominican Republic (under “other business” because the request was received too late to put on the regular agenda).

 

Intellectual property and health      back to top

(Explanations: full coverage of TRIPS and health and countries accepting the amendment)

In addition to extending the deadline for countries to accept the TRIPS amendment on public health, this meeting also saw the latest annual review of how the provisions are working, in which the question of high tariffs on medicine imports came to the fore.

Both deal with decisions setting up what is known as the “Para.6 system”. This removes an intellectual property obstacle preventing countries from using compulsory licences to manufacture generic medicines exclusively for export to countries unable to make them themselves. It refers to paragraph 6 of the 2001 Doha Declaration on TRIPS and Public Health.

The General Council first agreed to remove the obstacle through a 2003 “waiver”, a legal means allowing WTO members not to comply with an obligation or provision in a WTO agreement. Two years later it agreed to an almost identical amendment to the TRIPS Agreement, which has not yet entered into force.

The new two-year extension is to allow more countries to accept the amendment. Two thirds of the WTO’s membership have to accept the amendment before it can take effect — and it takes effect only in those countries that have accepted it. The TRIPS Council has agreed to recommend to the General Council that the period for acceptance be extended until 31 December 2015.

Because the amendment is virtually identical to the 2003 waiver, in practice the amendment makes little difference other than to be more clearly part of the TRIPS Agreement. This will be the fourth extension since the first deadline of 1 December 2007.

The review of how the “Par.6 system” works was largely a repeat of the previous years’ discussions. However, this time the question of high import duties on medicines came to the fore. The US and EU said this has been shown to be an important obstacle preventing access to medicine. They cited a WTO working paper (pdf format) and the WHO-WIPO-WTO study on Promoting Access to Medical Technologies and Innovation, where the effect of high tariffs is also observed.

India and China questioned the link between high tariffs and access to medicines since the tariffs could be used to encourage local production. Their focus, as with some other developing countries, was on the need for more information and the fact that the Par.6 system has only been used once — for medicine made under compulsory licence in Canada and exported to Rwanda. They repeated their call for a workshop involving a wide range of people involved.

A number of developed countries repeated their view that members should provide information first, before deciding on whether outside contributions are needed. In particular, they sought information from potential importers on whether the Par.6 system itself was proving difficult to use. Canada, the only exporter under the system, said it had posed a number of questions to potential importers, which still have not been answered.

 

Intellectual property and sport      back to top

Intellectual property is a vital component of sport, helping to raise funds and produce innovations at the top level that can spread throughout society, a group of countries said. But some other countries were wary that if the TRIPS Council focuses on topics such as sport, it will spend less time on subjects they consider to be more important such as food security, access to medicines and tackling biopiracy.

The advocates cited their own experiences in how a wide range of technological innovations can develop in sport, how revenues can be raised and disseminated through ticket sales, sponsorship, broadcasting and merchandising, and how they have developed laws and administrative structures to serve this.

Developing countries such as Jamaica and Trinidad and Tobago said their success in sports such as athletics and cricket had generated income that has helped with their economic development. Jamaica said it is active in working on intellectual property in sport because sport is a major source of income, with world stars such as Usain Bolt using sponsorship and his trade-marked name to prevent infringements. Intellectual property and sport “are vital pillars of the country’s national development agenda,” Jamaica said.

The two Caribbean countries had joined the EU, Mexico and the US in putting the subject on the agenda for the first time. Support for discussing the subject also came from Switzerland, Australia, Canada, Japan, Brazil, Rep. Korea and Paraguay. A few of these saw the discussion as an extension of previous sessions on intellectual property and innovation. Some cited sport innovations that had been useful for health, including prosthetics for the Paralympics. Japan referred to the invention of “asymmetric” socks, which are designed specifically to fit left or right feet and to be more comfortable for athletes.

The EU said 3.7% of its gross domestic product (GDP) comes from sport, and 1.76% of its economy’s gross value added. Around 15 million people are employed in activities related to sport, and the share of sport in employment is 2.12%, comparable to agriculture, forestry and fishing combined, the EU said.

Reservations about the wisdom of discussing the subject at all came from Venezuela, China, India, Bolivia, Cuba, Ecuador and Nepal. Some of them said that issues such as broadcasting rights are being discussed in the World Intellectual Property Organization and cautioned against duplicating that work.

 

Non-violation complaints      back to top

Members agreed to work more intensively than before once a new extension to the period when “non-violation” cases are outlawed in TRIPS is adopted. In the new year, they intend to discuss seriously whether these cases should be allowed for intellectual property, and if so, how this might be done. Recently members have agreed the extensions almost automatically every two years, with little discussion on the substance.

The decision to recommend extending the present period until 31 December 2015 is “ad referendum”, meaning that members have given themselves a brief period — until 21 October — to raise any objections. If there are none, the decision will stand and WTO trade ministers will be expected to endorse it when they meet in Bali in December, as they did in 2011 in Geneva.

Complaints about countries being deprived of expected rights — such as access to export markets — even when no WTO rules or commitments have been violated, can be lodged as formal legal disputes for trade in goods and services. But members disagree about whether complaints of this kind would be possible in intellectual property. Broadly, the US and Switzerland argue that non-violation complaints are possible in TRIPS; most other members disagree, but some have said they want to consider how non-violation complaints might be handled.

Members compromised by writing into the 1995 TRIPS Agreement a five-year “moratorium”, ie, an agreement not to bring non-violation cases in TRIPS in the period 1995–99 (Article 64.2). This has been extended from every ministerial conference to the next since then.

In May 2003, the TRIPS Council chairperson listed four possibilities for dealing with the moratorium. The present chairperson has indicated a similar set four possibilities will be discussed next year:

  • banning non-violation complaints in TRIPS completely (as would happen if no further extensions are agreed)
  • allowing the complaints to be handled under the WTO’s dispute settlement rule,s as applies to goods and services cases
  • allowing non-violation complaints but subject to special “modalities” (i.e. ways of dealing with them)
  • extending the moratorium (or making it permanent)

Meanwhile, the decision that ministers would be asked to adopt in Bali would say:

“We take note of the work done by the Council for Trade-Related Aspects of Intellectual Property Rights pursuant to our Decision of 17 December 2011 on ‘TRIPS Non-Violation and Situation Complaints’ (WT/L/842), and direct it to continue its examination of the scope and modalities for complaints of the types provided under subparagraphs 1(b) and 1(c) of Article XXIII of GATT 1994 and make recommendations to our next Session, which we have decided to hold in 2015. It is agreed that, in the meantime, Members will not initiate such complaints under the TRIPS Agreement.”

 

Biodiversity      back to top

Members’ positions were largely unchanged in the discussion on the relationship between the TRIPS Agreement and the UN Convention on Biological Diversity (CBD).

Some members continued to argue that the TRIPS Agreement needs to be amended to require patent owners to disclose the source of the genetic resources and related traditional knowledge used in their inventions. The amendment would ensure the TRIPS Agreement matches the CBD on the need to share the benefits of patented inventions with local communities or authorities and that access to the resources and knowledge is based on informed consent received beforehand.

Some others continued to argue that there is no need to amend the TRIPS Agreement because countries can apply both the WTO and the CBD agreements without any conflict between them, and that disclosing the source of material and knowledge may not be the best way to prevent misappropriation or inappropriate patenting (such as patenting claimed inventions that are not new).

Repeating their calls for a “disclosure” amendment were: Indonesia, Egypt, Brazil, Bangladesh, India, Colombia, Cuba, Ecuador, Switzerland, the EU and Sri Lanka. Bolivia supported by Bangladesh, Ecuador and Venezuela repeated their opposition to any patenting for life forms. Rep. Korea, the US Japan, Canada and Australia repeated their opposition to “disclosure” and their preference to discuss the issue in the World Intellectual Property Organization.

China and Cuba said a discussion in the World Intellectual Property Organization (WIPO) could not substitute for work in the WTO. China, Egypt, India Switzerland and the EU called for consultations chaired by the director-general to be revived sometime after the Bali Ministerial Conference. The chairperson said the TRIPS Council does not have the power to decide on reviving the consultations, but that the message would be conveyed.

 

Intellectual property, climate change and green technology      back to top

Members largely repeated the discussion of the previous meeting. Ecuador led the call for a declaration to be issued at the December Bali Ministerial Conference, highlighting the flexibilities available in the TRIPS Agreement — along the lines of the 2001 Doha Ministerial Declaration on TRIPS and Public Health, and for work after the Bali conference. Support came from Bolivia, Indonesia, Cuba and India.

China was sympathetic but said it would reserve judgement on its final position. Brazil said using flexibilities under TRIPS could be considered but incentives for innovation are also important, as are the problems of low quality patents and finance.

Several countries countered that intellectual property protection does allow technology transfer and that the comparison with pharmaceutical patents is inappropriate because green technologies are considerably more competitive. They included: the US, EU, Japan, Canada, New Zealand, Chile, Australia and Switzerland.

 

Technology transfer to poorer countries     back to top

Among the other issues discussed were incentives developed countries are required to give to their companies and other institutions to transfer technology to least developed countries (TRIPS Art.66.2). Fifteen developed countries, including the EU and seven of its members individually, submitted detailed reports on this as part of an annual review.

In a workshop on the incentives before the TRIPS Council meeting, least developed countries said the vast amount of information is difficult to digest, the Secretariat reported. Improvements in handling the information are being introduced, it said. Meanwhile, members are also examining a standard format for submitting the information, which some countries say might be difficult to implement.

India complained that least developed countries’ requests for better information receive a response from developed countries that “is mostly ritualistic and non-serious, far from meeting the desired objective.” The US rejected the accusation and offered to walk the Indian delegation through its detailed report. The EU said the hundreds of millions of euros spent under these provisions cannot be called ritualistic.

The council also reviewed technical assistance that developed countries and intergovernmental organizations are making available to developing countries (under TRIPS Art.67).

 

Chairperson: Ambassador Alfredo Suescum of Panama

 

Next meetings   back to top

TRIPS Council (regular) meetings (could change):
2014

  • 25–26 February
  • 11–12 June
  • 28–29 October

 Jargon buster 

• CBD

• GIs

• modality, modalities

• Paragraph 6 system

• Special Sessions

• TRIPS

> More jargon: glossary

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