Trade And Development With A Dash Of IP: Conference To Set Course For UNCTAD

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The quadrennial conference of the United Nations Conference on Trade and Development (UNCTAD) sets the course of the UN body work for the next four years. The mandate of the conference has evolved since its creation to become mainly a provider of research, policy analysis and technical assistance to developing countries. This time around, the conference will serve as a wide-ranging forum for trade and development issues, and intellectual property issues will haunt discussions in several areas.

The thirteenth session of the UNCTAD will take place from 21-26 April in Doha, Qatar. The conference sets the organisation’s mandate and work priorities for the next four years. According to the UNCTAD website, the conferences “allow intergovernmental consensus building (…) and play a key role in identifying the role of the United Nations and UNCTAD in addressing economic development problems.”

Taffere Tesfachew, spokesperson for UNCTAD XIII, told a 30 March press briefing that the objective of the conference is much broader than defining UNCTAD’s mandate for four years. This conference, he said, is a forum for all members to come and address trade and development issues and it comes at an opportune time when the multilateral system is going through some rethinking, in particular in trade and finance.

The conference is more akin to a parliamentary debate, Tesfachew said: there is no need to agree and sign an instrument. The conference is a place where the international community meets to address international issues, and not only about developing countries, he added.

At the global level, there is no other forum to address these issues, he said. The theme of the 13th conference is “Development-centred globalization: Towards inclusive and sustainable growth and development”.

Negotiations on Draft President’s Text

Countries have been working on the draft President’s negotiating text [pdf] for UNCTAD XIII for some times and the document that will become the outcome document of the conference now features over 250 paragraphs, according to Tesfachew. The current compilation negotiating text is not yet available, he said. As of 30 March only a dozen or so of those paragraphs had been agreed in what Tesfachew described as a usual process.

In the draft President’s negotiating text, intellectual property protection is mentioned as a component of a stable and predictable investment climate. However, according to the document, “intellectual property rights raise some of the most challenging concerns for policymakers in developing countries.”

In particular, the text says, “Intellectual property rights are a source of rents, which are justifiable to the extent that the benefits, in terms of encouraging real innovation, outweigh the costs, in terms of higher prices and restricted access, and there are clear limits to the time they are in place. There have been ongoing efforts to strengthen the safeguards and flexibilities contained in the global intellectual property regime, notably through parallel import arrangements and compulsory licensing. However, the current global framework has tended to skew research and development towards technologies offering high market returns, particularly in the advanced countries, instead of those offering the greatest social benefits or addressing the needs of developing countries.”

Country Group Position Papers Reveal Divergent Views on IP

Groups of countries have submitted position papers to the process, specifying the role of UNCTAD. The European Union would like IP to be left to the UN World Intellectual Property Organization (WIPO), and a group of other developed countries insist on IP being key to foreign direct investment. Meanwhile, least developed countries are calling for mandatory disclosure of origin in patent applications.

According to a source, the paragraphs of the current compilation negotiating text about IP and technology transfer are heavily bracketed.

For the “JUSSCANNZ” group, comprising Japan, the United States, Switzerland, Canada, Australia, Norway and New Zealand, “economic growth is key to promote inclusive and sustainable development and to reduce poverty.” In their paper [pdf], the group calls for a sound IP rights protection framework to foster entrepreneurship and attract foreign direct investment.

UNCTAD should “sharpen its focus on how developing countries can attract, facilitate and maintain private investment, both foreign and domestic,” and “support private-sector led growth and development to reduce poverty and achieve development aims,” JUSSCANNZ said.

The European Union also encourages UNCTAD to “continue to carry out research and analysis to promote policy dialogue and to provide technical assistance.” In its position paper [pdf], the EU said that UNCTAD’s work “should not overlap with, and be consistent with the work of other United Nations organisations, the WTO [World Trade Organization], World Bank, IMF [International Monetary Fund], and OECD [Organisation for Economic Co-operation and Development].”

“The EU view is indeed that duplication of work should be avoided as much as possible and it should be clear who has the lead on which subject. Taking the example of IP, UNCTAD is already involved doing WIPO related work but it should be clear that WIPO has the lead on IP,” an EU source told Intellectual Property Watch.

“Another example on which some countries want UNCTAD to work is global economic governance, a subject of the remit of the World Bank and IMF,” the source said, adding that “in general, the EU is positively engaged in the UNCTAD process, working constructively and actively in the negotiations, however, there are principles which ought to be preserved, one of which is that the work of other agencies should be respected.”

In their position paper [pdf], the Group of 77 plus China makes scarce reference to IP, but calls for balance. Traditionally developing countries regard IP rights as a possible barrier to technology transfer. The group still says that foreign direct investment “should contribute to the promotion of knowledge-based development and strengthening the capacity to develop technology by developing countries and to prevent the current unbalanced situation of global intellectual property.”

The group also called for UNCTAD XIII to ” look at how to balance the role of the state and market force” and for UNCTAD to “urge states to refrain from enacting and implementing unilateral economic, financial or trade measures that are not in accordance with international law or the Charter of the United Nations.” They suggested that UNCTAD develop “a code of conduct or guidelines on technology transfer for the benefit of developing countries.”

The G77 plus China was established in 1964 by 77 developing countries who were signatories of the “Joint Declaration of the Seventy-Seven Countries”,” at the end of the first session of the UNCTAD Conference in Geneva, according to the G77 website.

The group of Least Developed Countries (LDCs) position paper [pdf] recalls the binding obligation for the developed members of the WTO to transfer technology to the LDCs in the context of the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) Article 66.2, and the fact that this obligation has largely remained unenforceable, in particular because of some ambiguities in TRIPS.

In that position paper, LDCs also underlined the need for the mandatory requirement of disclosure for the genetic resources and associated traditional knowledge of the country of origin in patent applications, and for the general use of benefit-sharing and prior-informed consent to be compulsory.

At the 4th BRICS (Brazil, Russia, India, China and South Africa) Summit in New Delhi on 29 March, the group of countries issued a “Delhi Declaration“[pdf] in which they say that they consider “UNCTAD to be the focal point in the UN system for the treatment of trade and development issues, we intend to invest in improving its traditional activities of consensus-building, technical cooperation and research on issues of economic development and trade.”

UNCTAD: Development Aid or Trade Assistant

According to Vicente Yu, coordinator for the Global Governance for Development Programme at the South Centre, an intergovernmental organisation of developing countries, “for developed countries, UNCTAD’s work on IP issues, if any, should be focused on IP enforcement consistent with the work of WIPO. But for developing countries, the focus of UNCTAD’s work on IP issues should include looking at the developmental aspects of IP, including the use of IP flexibilities and ensuring that IPRs do not become barriers to technology transfers that are needed for their development.”

“For developing countries, UNCTAD XIII is an opportunity for the global community through UNCTAD to provide a clear analysis of the major development challenges that still need to be addressed and how UNCTAD can contribute to addressing these,” he told Intellectual Property Watch. “In this regard, it is important for UNCTAD to retain its ability to provide macroeconomic policy research and analysis that are heterodox and ahead of the curve particularly in areas of multilateral policymaking that affects the development prospects of developing countries,” such as trade, debt, commodities, or global economic governance reform.

“For developed countries,” Yu said, “UNCTAD XIII will be an opportunity for providing a specific and focused mandate for UNCTAD’ work, in pre-defined technical areas, such as investment liberalization policy, competition policy, trade liberalization policy, especially in providing technical assistance that complements those provided by other institutions such as the World Bank and the WTO.”

The South Centre is an intergovernmental organisation serving as a multilateral policy research institution for developing countries. It was established in 1994. The South Centre’s membership is composed of 51 developing countries.

The first UNCTAD Conference was held in Geneva in 1964 in response to “growing concerns about the place of developing countries in international trade,” according to UNCTAD, and the call of those countries to have a conference devoted to tackle problems and identify international actions. The G77 was established in the wake of the conference, it said.

According to some sources, the role of UNCTAD has shifted over the years, with some of its core primary functions delegated so other specialised organisations, such as the WTO, the World Bank, the OECD. UNCTAD, according to a source, lost its negotiating mandate in the 1990s, and UNCTAD’s work then focused more on a technical assistance role, such as aid for trade.

“On UNCTAD XIII, a positive outcome would be one in which UNCTAD remains a strong UN body that can provide developing countries with support, analysis and advice so that they can be innovative and heterodox, as appropriate, in their development policies,” Yu told Intellectual Property Watch.

Catherine Saez may be reached at info@ip-watch.ch.

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