Emerging Markets and the World Patent Order is a new book that looks at the key issue of patent system implementation in emerging market and developing countries, and the response to this implementation by Europe and the United States. Florida State University Law Prof. Frederick Abbott, one of the organisers and editors of the book, recently discussed the book with Intellectual Property Watch’s William New.

Emerging Markets and the World Patent Order, F. Abbott, C. Correa & P. Drahos eds., is available from Edward Elgar here.

Intellectual Property Watch (IPW): Can you tell us what this book is about and why it is important?

Frederick Abbott (Abbott): This book examines the state of implementation of patent systems in a select group of “emerging market” countries, the situation of a few other developing countries, and reaction to that implementation in and from Europe and the United States. It also considers the extent to which developments in the emerging markets are having, or will have, effects on the wider international patent regime.

IPW: What was your motivation for organizing (and authoring) this book?

Abbott: Economists have long appreciated that patents are a tool of industrial policy and that individual country interests regarding industrial policy vary over time. As the internal circumstances of a country (or region) change, perceptions regarding the optimal characteristics of the patent system may also change. Patents also play an important role in addressing social welfare interests. The way a country goes about protecting and promoting social welfare – which takes into account human rights, budgetary and political factors – may also change over time.

It is evident that over the past 20 years the economic, social and political landscape of the global community has undergone some significant shifts. Economic and political power has diffused from Europe and the United States to countries like Brazil, China, India and South Africa.

We were interested in analyzing how the patent systems of the emerging market countries are adapting to the shifts in economic and political circumstance, and how such changes might be influencing the broader international patent regime. Are these countries developing and implementing new models, are they substantially adapting existing models, or are they largely replicating the patent systems as they have evolved in Europe and the United States? If adaptation is taking place, are these adaptations to be recommended for countries in similar circumstances, or to the broader international patent community?

IPW: How was the book structured and researched?

Abbott: We organized a meeting of the prospective authors at Florida State University College of Law in 2012, where preliminary assessments were presented and discussed. Over the next year or so, the authors elaborated on their initial assessments. We tried to identify – we believe we were successful – leading thinkers and experts for the individual country reports, as well as some authors taking a more global perspective on issues of patenting trends, political economy, economics, regulatory regimes, and a few select substantive areas. As examples, Carsten Fink, chief economist at WIPO, organized data on patenting trends, and Susan Sell, the well-known political scientist, addressed global political economy issues.

At the country level, we had the help of recognized authorities from the individual countries. For example, Rajeev Kher from India contributed a comprehensive and extremely thoughtful chapter of the book, and he has recently been named Commerce Secretary of India. Andre Kudlinski, who is the director of pharmaceuticals at the Department of Trade and Industry in South Africa, wrote an insightful chapter regarding the situation there. We have two contributions from China, one focusing on economics, one on law. I should not go through the authors of each of the country chapters so as to avoid singling out particular contributions. We believe they are all quite good.

IPW: Can you tell us about your overall findings?

Abbott: Carlos Correa, Peter Drahos and I tried to synthesize the findings in our introductory chapter. In terms of the way the emerging market countries are implementing patent law, there are a few notable instances of significant adaptation from the European and US models. But taking a broad perspective, the emerging market patent systems do not evidence many major breaks or “innovations” from the dominant European-US models. You have the fairly well-known examples of Brazil’s ANVISA review of pharmaceutical patent applications, and India’s adoption of Section 3(d). But, outside of a few notable instances, by and large the emerging market patent systems appear to be largely in line with the models that have evolved in Europe and the United States.

That is a somewhat different question than how national patent laws are being used to accomplish particular objectives. For example, the patent law of virtually every country allows for some form of government use or compulsory licensing. If Indian authorities grant some compulsory licences on important medicines, that is not a break from the traditional patent system model. That is a decision to use the predominant model as it is designed. Patent systems incorporate social welfare safeguards for a reason, not as some form of “window dressing”.

This is not to say that each emerging market country is moving at the same pace. We include chapters regarding countries that are not part of the “emerging market” group, and it is evident that patent system development is rather different when one looks at low income, and low-middle income countries, more broadly.

There is one trend we identified among the emerging markets that is cross-cutting. That is, encouragement of “local production” through various types of industrial policy measures. This may be somewhat counter to the WTO conventional wisdom that reduced trade barriers inevitably lead to local economic growth and employment. National governments are not content to sit back and hope that liberal trade policy will generate meaningful local employment opportunities. As a practical matter, the promotion of local production has long been a staple of European and US industrial policy. So, to the extent that the emerging market countries are actively encouraging local production through various forms of incentives, this can also be looked at as a type of modeling. Just not a type of modeling that has been advertised by the European Union and United States.

IPW: How are the European Union and the United States reacting to the stronger role of the emerging markets in the patent field?

Abbott: In his writings, Peter Drahos has previously pointed out that much of the day-to-day activity of patent offices is more deeply coordinated across global lines than is generally thought. The European Union and United States continue to actively pursue inter-agency cooperation with patent offices in the emerging market countries, and we think this in part accounts for the relative degree of equivalence among the way patents are granted and maintained. While the politicians, NGOs and other stakeholders may be battling in public arenas, the administrative personnel in the patent offices are going about their daily business in a fairly similar way.

At the level of external trade policy, readers of IP-Watch will know that European and US external trade authorities take very seriously any suggestion that the rules of the predominant patent regime may be subject to tinkering. I will not dwell on that as it reflects the outward manifestation of internal lobbying by wealthy corporate interests. USTR and the European Commission Trade Directorate will continue to threaten India because that is what USTR and the Trade Directorate do for a living.

One of the most interesting questions to me, which we raise in the book (including in a very interesting chapter from Geertrui Van Overwalle regarding the EU), is what happens when the shoe moves to the other foot and Chinese companies begin to actively enforce their patents in the United States and Europe. This may be a few years off, but the development is inevitable. Will the U.S. Congress and the European Council and Parliament begin to question whether providing the maximum number of patents and the maximum level of patent enforceability is such a good idea? Will China be the new patenting power, or at least share that role with the United States or Europe? Will Chinese companies adopt the Japanese model and begin to use Section 337 actions to block imports into the United States from other countries?

IPW: Do you have anything you would like to add?

Abbott: One final speculative question we raise is whether super-wealthy elites across national boundaries share more in common with each other than they do with their national country-fellows. Patents are by and large a wealth protection mechanism, and wealthy elites share a strong interest in that subject. To the extent that the wealthy elites control lobbying funds and through that government policy, might it be that patent policies converge across national boundaries because of these shared interests? I realize this is a general subject that has recently gained a good deal of traction because of the book by Thomas Piketty, but it has also been written about by Joseph Stiglitz and Paul Krugman. The question that is worth asking is how the interests of the ordinary consumer will be protected. I do not suggest that countervailing interested groups – NGOs, academics, some good people in multilateral institutions – are not pushing back. But, this is just one more element to enter into the mix of how patent systems will continue to evolve in the emerging market countries. We hope our book will stimulate thinking about all of these questions.