The member states of the U.N. World Intellectual Property Organisation on Friday called on the organisation to act on independent recommendations to clean up its financial and personnel management practices.

The recommendations were made earlier this year by the independent U.N. inspection team whose investigation in late 2004 found fault with WIPO’s practices. The WIPO secretariat has already progressed on many of the recommendations, but after hearing from members of the Joint Inspection Unit (JIU) Friday, member states urged the organisation to finish the cleanup process and report back in a year.

The JIU is planning a second phase of the WIPO investigation to cover a broader range of areas and not to exclude reports of potential financial irregularities reaching to the organisation’s highest levels, according to informed sources.

JIU Inspector M. Deborah Wynes told the WIPO General Assemblies on 30 September that many recommendations were made directly to the Director General since he has the capacity to implement them automatically, but that his response was “in several cases, unclear and vague.”

Questions arose during her presentation over the distribution of the JIU’s four-page matrix comparing the original JIU recommendations, WIPO’s proposal, and the JIU follow-up comments. When the JIU officials spoke before the General Assembly, many member governments had not yet seen the matrix. The matrix had not been copied for them and only some members – apparently the biggest economies — had received the matrix in advance of the assembly. Some member countries said privately that the JIU had tried to disseminate the report through WIPO but appeared not to have received help from the WIPO secretariat.

In its report, the JIU recommended the Director General hire independent external experts to perform a “desk-by-desk” needs assessment of the organisation’s human and financial resources. It also recommended approval of a 2006-2007 budget at the 2004-2005 level, and urgent consultations with other organisations such as the European Patent Office to determine the cost of processing applications under WIPO’s Patent Cooperation Treaty, its chief source of revenue.

Another recommendation was to limit transfers between programmes to five percent of the smaller programme involved. Wynes told the General Assembly the Director General should not have the ability to transfer up to five percent of the entire WIPO budget from one section to another, as even the U.N. Secretary General does not have the authority to transfer any funds. The concern at the U.N. level is that it is “tantamount to changing political priorities,” she said.

On personnel, the JIU recommended a hiring freeze, an end to the transfer of positions with posts, approval of post reclassifications via the budget process, and the establishment of a comprehensive human resources strategy.

The JIU also called for stronger audit and oversight, and in its first days the General Assembly approved the creation of an Audit Committee and an internal audit charter. Wynes suggested the Program and Budget Committee be authorised by this General Assembly to make changes in the WIPO external auditor’s terms of reference during 2006.

Wynes said the WIPO secretariat said it froze hiring on 1 January, but with limited exceptions for urgent needs. “How many exceptions should be made?” Wynes said. “All means all.” The JIU recommended that urgent needs should be met by internal redeployment within the agency. But it was raised at the General Assembly that in some cases there may not be a suitable existing employee for a highly specified task.

Wynes also said WIPO has an “unclear history” on employee reclassifications, noting that the chairperson of its reclassification panel resigned after the panel did not meet in 2004. She also said positions should be properly advertised with no unfair advantage given to the incumbent candidate.

Numerous African delegations took the floor to heap praise on WIPO Director-General Kamil Idris, who is from Sudan. Many cited as remarkable his voluntary refusal to receive salary as the head of the International Union for the Protection of New Varieties of Plants (UPOV) and instead dedicate it for development. But the JIU inspector said it should be expected given the salary as WIPO head is commensurate with other U.N. agencies, and the JIU recommended that the practice of not accepting the UPOV salary be institutionalised.

The Group B industrialised nations expressed support for the JIU report. The European Union urged member states to exercise their “board of directors” function, as noted by the JIU, by taking an “active and robust role in both the programme and budget processes.” Group B’s statement on WIPO’s audit charter and audit committee backed the review of WIPO’s governance because “the good reputation of WIPO needs to be protected.”

The European Union said it “welcomed the news that the Director General will bring in independent auditors to look into allegations of fraud and make recommendations on improvements to internal control.”

Proposed WIPO Budget Adopted Easily, New Construction Coming

Early in the assemblies, the member governments approved easily WIPO’s proposal for a balanced budget in 2006-2007, its first in four biennia, according to Financial Controller Carlotta Graffigna. The new budget will be CHF531 million, a CHF8 million increase over the revised 2004-2005 budget. Developed countries that are big users of the patent system were pleased that there was no patent fee increase.

Meanwhile, WIPO received approval to take out a bank loan to fund construction of a new administrative building. For the past couple of years, there has been an unsightly large hole in the ground surrounded by fencing in front of the WIPO headquarters where construction was once begun. Construction is expected to resume in 2006.

Governments Agree To Negotiate Revisions To Trademark Law Treaty

In other developments at the assembly, the governments accepted an offer from Singapore to host a diplomatic conference on a revised Trademark Law Treaty, to be held from 13 to 31 March, 2006. The Trademark Law Treaty was concluded in 1994, but rapid changes in telecommunications and other developments have made it necessary to update it.

Changes to be sought include electronic filing of applications, representation of all types of marks including visible signs such as holograms as well as non-visible signs, the establishment of an assembly of contracting parties, and other measures. An agreed-upon “basic proposal” has been prepared by the Standing Committee on Trademarks.

Wide Range Of Observers Admitted To WIPO

Finally, the member states agreed to admit all applicants as observers to WIPO. Among these are: Palestine, the Hague Conference on Private International Law, African Intellectual Property Association, Business Software Alliance, Computer and Communication Industry Association, Computer Professionals for Social Responsibility, Consumers International, Creative Commons International, Electronic Information for Libraries, European Consumers’ Organisation, European Digital Media Association, European Digital Rights, International Centre for Trade and Sustainable Development, International Policy Network, IP Justice, Royal Society for Encouragement of Arts, Manufacturers and Commerce, Third World Network, and Union for the Public Domain.

Some others included are: Fundacao Getulio Vargas (Brazil), Generic Pharmaceutical Association (U.S.), German Association for Industrial Property and Copyright Law, Institute for Policy Innovation (U.S.), Intellectual Property Left (Korea), Mexican National Association of Pharmaceutical Manufacturers, Public Knowledge (U.S.), and the U.S. Telecom Association.