(i) to ensure that measures and procedures to enforce intellectual property rights do not themselves become barriers to legitimate trade; and

(ii) to develop a multilateral framework of principles, rules and disciplines dealing with international trade in counterfeit goods.

i) The questions do not prejudge the scope of GATT commitments in the area of enforcement. Rather, they recognise that different views have been expressed on this matter; for example, some say that commitments on effective enforcement should concern only trade in counterfeit goods while others refer to infringements of intellectual property rights generally. The section on "scope" is thus an attempt to put down systematically the questions that the Group would need to examine in order to have a clear picture in concrete terms of the positions of participants.

ii) The annex is designed not to prejudice any participant's view about whether separate commitments should be negotiated on trade in counterfeit goods or whether these should form part of a wider set of commitments resulting from the work of the Group. It also does not in any way prejudice the issue of under which agenda item the different questions might be addressed: this was left to each participant to determine.

iii) The annex does not prejudice any participant's position on the question of substantive standards. These are not dealt with, except in paragraph (iii), under "scope", which suggests that the issue of appropriate procedures and remedies for enforcement can be discussed irrespective of what, if anything, emerges on the question of substantive standards.

- What types of infringement of those intellectual property rights should be covered?

- What should be the substantive intellectual property law that is being infringed?

- At what points of intervention should the procedures and remedies apply?

(i) Coverage of intellectual property rights. The discussion at the Group's last meeting on trade in counterfeit goods showed that, in their initial thinking, some delegations favoured a larger and others a narrower conception of what should be covered. It also seemed to demonstrate two other points: generally speakers

- Disputes would only be disputes over whether a member government had met its GATT commitments: these commitments would only be on governments, not on private parties.

- Only governments, not private parties, would have access to multilateral dispute settlement procedures.

- It is not suggested that governments themselves be obliged to initiate action to prevent the violation of intellectual property rights. Thus, the fact that private parties in a country are violating intellectual property rights would not in itself be grounds for dispute settlement proceedings against that country.

- GATT obligations on governments would take the form of ensuring that their national legislation on the trade-related aspects of intellectual property rights was consistent with their GATT commitments and that the legislation in question was effectively applied.

- When assessing whether legislation is effectively applied, due allowance should be made for the different possibilities of countries - of the objective constraints facing each country. The obligations should be such that, in any dispute settlement proceedings, a common sense assessment would be made of what would reasonably be expected of a country according to its

situation.

i) The General Agreement does not put on governments specific obligations to enforce intellectual property rights or to accord any particular level of protection to intellectual property. The only GATT provision that specifically promotes the protection of intellectual property is Article IX:6, which concerns certain geographical indications. This requires contracting parties to cooperate and to be willing to consult with each other and indicates the standard of protection that such cooperation and consultations should aim to promote.

ii) The General Agreement recognizes the right of contracting parties to enforce intellectual property rights and contains a specific "exceptions" provision, Article XX(d), that authorizes contracting parties to take, subject to certain conditions, measures that would normally be inconsistent with the General Agreement for this purpose.

iii) The conditions attached to the use of Article XX(d) are essentially designed to ensure that such measures are not employed as unwarranted restrictions on trade or means of discrimination between contracting parties.

iv) With the same basic aims, the General Agreement also contains a number of general rules that apply to a wide range of governmental measures, both at the border and internally, including when taken in connection with intellectual property rights. Thus Article III on national treatment requires that, in so far as laws, regulations and requirements on intellectual property rights affect the internal sale, offering for sale, purchase, transportation, distribution or use of products, they should not be applied to imported or domestic products so as to afford protection to domestic production or to accord imported products less favourable treatment than like products of national origin. The basic GATT most-favoured-nation rule (Article 1) and the GATT provisions on the publication and administration of trade regulations (Article X) also apply widely to intellectual property law as it affects trade.

v) while these GATT rules-serve to prevent intellectual property legislation from having certain undesirable effects on trade, the General Agreement also contains two specific requirements that trade measures must not be used in a way that would prevent compliance with intellectual property procedures. The trade measures in question are import restrictions taken to safeguard the balance of payments (Articles XII:3(c)(iii) and XVIII:10).

- the consultation provisions of Article XXII can be invoked to the extent to which a matter related to intellectual property rights is considered to affect the operation of the General Agreement;

- the dispute settlement provisions of Article XXIII can be invoked to the extent that some measure or situation related to intellectual property rights, whether or not conflicting with GATT obligations, is considered to be a cause of nullification or impairment of benefits under the General Agreement or an impediment to the attainment of any of its objectives;

- under Article XXV:1, the CONTRACTING PARTIES can take joint action on a matter concerning intellectual property rights where this would facilitate the operation and further the objectives of the General Agreement.