WIPO: Progress On 2016-2017 Program/Budget, But Final Work Left To Assembly

Members of a World Intellectual Property Organization committee last week reached some tough agreements on issues relating to the next two years’ program and budget, but had to pass on unfinished work to the full WIPO membership, which will meet in two weeks.

The WIPO Program and Budget Committee met from 13-18 September. All meeting documents are here. [Update: The final decisions text from the week is now available here on the WIPO website.]

“I think the General Assembly will be happy with us,” the meeting chair said at the end. “Major progress was made. The text is basically complete.” The main sticking point is a question of methodology for allocation of funds to separate the Lisbon (appellations of origin/geographical indications) and Madrid (trademark) systems.

The committee agreed to separate for accounting purposes the budgetary presentation of the international systems for trademarks and appellations of origin/geographical indications. Lisbon members saw themselves as having made a “big leap” in agreeing to this, as one delegate put it afterward.

But other questions on the separation of these systems were not resolved.

“The approval of the program and budget is now in the hands of the Assembly,” a participant said afterward. And it is in the hands of the United States, which has held out its approval contingent on certain changes, the participant added.

The US has set out six “conditions” (as the chair calls them) before it can give its approval. They are, as stated by the US:

“1) Separation accounting between Lisbon and Madrid

2) Lisbon system income and expenses whether direct or indirect be accurately reflected

3) Lisbon budget is balanced without the help of other Unions’ income

4) Secretariat to conduct a study on Lisbon sustainability

5) Earmark of any diplomatic conference for 2016/2017 biennium be conditional on full participation to prevent the injustice that happened in May to ever happen again in this organization

6) Secretariat revise annex 3 of the programme and budget and make it more accurate”

External Offices

In another area, the committee decided to spare from elimination the WIPO liaison office in New York, though it could not agree on the bigger question of opening new WIPO external offices in other countries around the world.

Under program 20 in the proposed program and budget, item 20.22, the secretariat proposal to close the New York office by 2017 was changed. According to a draft copy obtained by Intellectual Property Watch, it now reads:

“Resources required to continue the current operating model for the WIPO Coordination Office in New York throughout the biennium 2016/2017 will be ensured through cost efficiencies and savings in the overall implementation of WIPO’s Program and Budget.”

WIPO, a UN agency, had argued that it could handle relations with the New York headquarters of the UN directly from Geneva.

On the external offices, a late debate ensued over Africa’s effort to include special mention of it being the only continent not represented in the WIPO external office network. But agreement could not be reached to give so much as a mention as countries from other regions jealously fighting for a WIPO office could not allow it. These included Romania on behalf of the Central European and Baltic States (CEBS), Mexico, and Korea. WIPO members have been trying to work out principles for the selection of such offices after past years saw several countries chosen without their involvement.

In the end, a throwaway line had to be agreed to in order to close weeklong meeting: “The PBC, having discussed the issue of external offices, decided to refer it to the 2015 General Assembly.”

African region delegates expressed puzzlement over why the region lagging furthest in WIPO performance such as filing of IP rights applications would be the one with no WIPO external representation. One African delegate expressed “disappointment” near the end of the discussion, saying, “It feels like we’re in a perpetual cycle of justice delayed, justice denied.”

Discussion of the Lisbon/Madrid Issue

The committee could not reach agreement on whether to require that future funds for treaty negotiations known as diplomatic conferences should ensure that the negotiations are open to all WIPO members. Proponents of the requirement are still stinging from being excluded from voting on WIPO’s new geographical indications treaty finished in May. That treaty, known as the Geneva Act, revised the Lisbon System for the protection of appellations of origin by expanding it to include geographical indications, products from a particular geographic location with particular characteristics.

In a similar vein, members also could not agree on a revision to the way WIPO income and expenses are allocated by unions such as Lisbon. Some countries excluded from the Geneva Act voting insist that chronic money-loser Lisbon system not be perennially bailed out by other profitable systems, notably the Patent Cooperation Treaty (PCT). Others say that singling out Lisbon for this treatment could open to the door to different treatment for any WIPO activity that does not earn its own revenue. They also say that the Lisbon system needs support in order to grow toward great sustainability.

To that end, the committee spent significant time this week going over possible options for financial sustainability as presented by the WIPO secretariat. It was decided to take note of a revised version of the secretariat options document, WO/PBC/24/16 Rev. and recommend that the Lisbon Union members consider it at their annual meeting in October.

It was recommended by the PBC that all fee-funded unions convene before the discussion on the proposed 2016/2017 Program and Budget during the annual General Assemblies of member states in early October. The committee also asked interested member states to continue consultations in the meantime.

Copyright Collective Management Systems

In other areas of approval, the committee found a way forward on the program 3, for copyright and related rights, after getting hung up on a system for overseeing copyright collective management mechanisms proposed by the secretariat.

Under draft item 3.11, under “Advancing the Development of Copyright and Related Rights Infrastructure,” some compromise language was added, according to in-room documents from the meeting obtained by Intellectual Property Watch.

At issue was a quality assurance initiative called the “TAG of Excellence,” which refers to transparency, accountability and governance. Latin American countries in particular had some concerns over this item.

According to the draft text, the final version of 3.11 states: “Work in the area of copyright and related rights infrastructure will focus on establishing the TAG of Excellence (TAG) international quality assurance standard for collective management organizations (CMOs) as well as an education program on the transparency, accountability and governance of CMOs. TAG is an inclusive project which will involve a prior consultation process with WIPO’s Member States, national Copyright Offices and other key stakeholders.” The last line was added during the PBC meeting.

A performance indicator was also added on this issue, to be measured by the “number of national Copyright Offices actively engaged in the TAG consultative process.” The indicator sets a target of 25 copyright offices, with 2 CMOs applying for accreditation by or in 2017.

Other Programs and Issues

In another accomplishment of the week, the committee resolved a four-year long discussion by agreeing to a new definition of what constitutes an expenditure on development (IPW, WIPO, 18 September 2015).

Separately, discussions were held on a longstanding issue of improving governance at the agency, but developed countries appeared to drag their feet and the issue was bumped to next year. This topic seemingly could include anything from meeting length and frequency to overall transformation of the way the organisation functions.

In addition, the committee called on the secretariat to present at the next PBC in 2016 proposals to contain liability related to after-service health insurance.

And the committee delved into a financial issue for the UN agency – a hedging strategy for PCT income, deciding to allow the secretariat more time for analysis before making a decision.

In his opening remarks for the week, WIPO Director General Francis Gurry underlined the hedging strategy for the PCT, calling it “an extremely important item.”

“Since your discussions on this in the PCT working group and within the context of the PBC, we have identified a number of concerns and risks, in particular in relation to forecast accuracy of revenue in the implementation of a hedging strategy and in particular also in relation to the uncertainty of cash flows,” Gurry said. “The whole idea of the hedging strategy is to limit risk, so we don’t want its implementation to be increasing risks.” The secretariat suggested that further consideration is needed on the implementation of the strategy.

Gurry also mentioned the “lack of visibility that we have in relation to the global economy and the impact that that has on our banking arrangement and financial environment in which in Switzerland … we are operating in the context of negative interest rates.” This is extremely significant, he said.

Gurry expressed gratitude to Switzerland for considering WIPO’s request for increased transitional delay for the implementation of the new decision of the movement of the deposits that WIPO has with the federal department of finance beyond the existing deadline of December 2015.

 

Image Credits: WIPO