WIPO Program And Budget Committee Meeting Topics: New Projects, Reform, Rise In Expenses 07/09/2018 by Catherine Saez, Intellectual Property Watch 1 Comment Share this:Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Facebook (Opens in new window)Click to email this to a friend (Opens in new window)Click to print (Opens in new window)The World Intellectual Property Organization Program and Budget Committee, one of the main governing bodies of the organisation, will meet next week to finalize a range of issues on the functioning and work of the UN agency for the year. If WIPO has an insolently good financial status for a United Nations organisation, auditors still made a number of recommendations including on the trademark system managed by WIPO, the rental of space to third parties, the recording of works of art in the building, and late travel authorisations. WIPO The 28th session of the WIPO Program and Budget Committee (PBC) will take place from 10-14 September with an agenda [pdf] of reports and recommendations from independent bodies on the functioning of the organisation, the WIPO 2017 performance report and financial statements, an update on WIPO constitutional reform, and new WIPO projects for cloud hosting technology, and potential expansion of office space. Advisory Oversight, Whistleblower Policy, Terms of Reference Amendments The report [pdf] by the WIPO Independent Advisory Oversight Committee (IAOC), of which the PBC is expected to take note, includes a section on WIPO policy to protect against retaliation against employees, the “Whistleblower Protection Policy.” The document says the IAOC reviewed the proposed WIPO policy and provided “extensive comments and suggestions with a view to aligning the policy more closely to best practices in the United Nations system.” According to the IAOC, the final policy promulgated in September 2017 incorporated the recommendations of the committee. The IAOC suggested that the Chief Ethics Officer provide input to the Director of the Internal Oversight Division on how to identify situations of potential retaliatory threats. The PBC is also expected to consider for approval proposed amendments [pdf] to the Terms of Reference of the IAOC and to the Internal Oversight Charter. According to the document, the proposed amendments seek to describe more clearly the role and responsibilities of the IAOC, and clarifying its responsibilities with regard to the ethics function. External Auditor: No Concern except Madrid Building Also on the table next week is the yearly report [pdf] by the outgoing External Auditor, Rajiv Mehrishi, comptroller and auditor general of India. The auditor audited WIPO’s financial statements for the financial period ending on 31 December 2017. He said he had no concerns about WIPO’s financial statements. According to the document, WIPO’s statements show a surplus for 2017 of CHF 18.6 million (US$19million), a 50 percent decrease compared to the surplus for 2016. According to the document, “the decrease in the operating surplus in 2017 as compared to 2016 was mainly due to increase in expenditure of CHF 15.02 million on contractual services and CHF 9.50 million in expenditure on personnel. As compared to 2016, the improvement in the revenue was mainly due to increase in revenue of Patent Cooperation Treaty (PCT) Union and investment revenue.” Total WIPO revenue increased by 6.6 percent, from CHF 387.71 million (US$401 million) in 2016 to CHF413.48 million (US$428 million) in 2017, with the largest source of revenue being fees from the Patent Cooperation Treaty (PCT) (74 percent). In 2017, according to the document, WIPO expenses stood at CHF 394.85 million (US$409 million), up by 13 percent compared to 2016. The largest expense for WIPO in 2017 was personnel (58 percent of total expenses), increasing 4 percent over 2016. As of 31 December 2017, WIPO’s net assets amounted to CHF 202.66 million (US$209 million), according to the document. The External Auditor however remarked on the sale of the Madrid Union building in Geneva being conducted without competitive bidding, and asked that the sale of the building be placed before the upcoming annual WIPO General Assemblies (24 September-2 October). PBC members are also expected to consider the 2016/2017 WIPO Performance Report [pdf], and the 2017 WIPO Annual Financial Report and Financial Statements [pdf]. Madrid System in Deficit, Needs Fees Increase The External Auditor made a list of recommendations to the WIPO secretariat, which gave answers in an annex to the document. Some of those recommendations were directed at the Madrid System for the International Registration of Marks. According to the document, the revenue of the Madrid System was insufficient to cover the expenses of the system “during all the years except in 2015.” The auditor remarked that the number of applications was increasing but pointed out delays in processing “of transactions leading to huge backlog that increased from 26,582 in 2013, to 90,621 in 2016.” The auditor recommended that the fee structure, which had remained the same for the last 20 years, be revised. WIPO said the revision of fees had been planned in the medium-term plan of the Working Group, in 2019, according to the document. The recommendation asks that the review of the fee structure be made “weighing its impact on the accession of new members and on the usage of the Madrid System.” He also recommended that WIPO stick to the time limit defined in the program and budget document of 2018/19 for examination and processing of regular applications and further strengthen its efforts to reduce backlog. WIPO in its answer (annex of the document) said that with extra resources in place in the Madrid Operations Division in 2018, the volume of pending applications has decreased. Missing Work of Art, Others Not Recorded The External Auditor noted that “external agencies had pointed out that some Works of Art were not properly recorded in WIPO database.” The auditor recommended that WIPO complete the updating and information in the database of items qualifying as works of art. According to the document, an external agency carried out physical verification of assets in 2017 and found that 22 items of works of art were missing from the WIPO database, and that 84 “non-negligible items” were not available in the database and did not have barcodes. WIPO, said the document, stated that as of 31 December 2017, only one item had been missing out of 500 works of art and that “specific procedures for safekeeping and maintaining works of art were under preparation.” The auditor recommended that WIPO locate the missing work of art, and that if it cannot be located, the fact should be reported to the WIPO General Assembly. WIPO did not accept the recommendation, stating that there is no specific reporting to the General Assembly foreseen in the regulatory framework for cases of missing work of art, but would be ready to reflect the status of that item in its database as the search for it continues. But WIPO did accept the auditor’s recommendation to carry out risk assessment and review of existing measures to assess whether additional security/protection measures are needed for works of art. Internal Oversight Division Targets Events, Travel The annual report [pdf] by the director of the Internal Oversight Division (IOD) also provided some recommendations on several areas, one of which is the management of third-party events organised or hosted by WIPO. According to the report, an audit of the management of third party events showed that an overarching policy on organising and hosting such events, with instructions, internal memoranda, and guidelines would be helpful for providing direction and setting clear responsibilities and accountability. Rental fees were charged in only three instances out of 10 rental events in 2016, despite a policy on rentals of WIPO conference and meeting room, “thus generating additional costs from subsidising events” for third parties, the report found. “…assessing costs, and setting fees for Third Parties events held in open spaces such as the Arpad Bogsch Building Lobby and the New Building Atrium, which represent 55 per cent of the spaces used for these events, would help further enhance visibility on costs incurred, as well as help assess sustainability of this activity,” the report says. The report also pointed out the impact on the budget of late travel authorisations, “attributable to 10 programmes,” 77 percent of which were for non-staff travellers or third-party travellers. These delays, the report says, “have been cited as a contributory factor to the organisation purchasing higher priced tickets.” According to the report, the IP and Global Challenges Division “delivers a central, effective contribution to WIPO’s strategic goal of addressing IP in relation to global policy issues.” The report suggests however that the division strengthen its “Trilateral Cooperation model” with the World Health Organization and World Trade Organization. This recommendation is under implementation, the report says, to be completed by December 2018. Implementation of JIU Recommendations The WIPO secretariat provided a Progress Report [pdf] on the Implementation of the UN Joint Inspection Unit (JIU) Recommendations. Since the last report submitted to member states last year, the report says, the JIU issued nine reports, seven of which are relevant to WIPO. As of mid-May 2018, only one recommendation addressed to WIPO remained outstanding, and since 2010, some 84 percent of 291 JIU recommendations have been implemented, the report says. The outstanding recommendation regards the review of donor reporting requirements across the United Nations system. WIPO remarked in the document that voluntary contributions represent only some 3 percent of the final funding, “and do not pose the type of challenges that other UN system organizations encounter.” Constitutional Reform Process Two amendments to the WIPO Convention were introduced in 1999 and 2003, neither of which entered into force yet due to a lack of notifications of acceptance by member states. According to a PBC document [pdf] on the status of the constitutional reform process, the 1999 amendment seeks to limit the number of mandates of the WIPO director general to two fixed terms of six years each. This amendment could be a deal changer in the next WIPO director general elections, since the current Director General, Francis Gurry, is nearing the end of his second 6-year term. The 2003 amendment would abolish the WIPO Conference, formalise the unitary contribution system and the changes in contribution classes in practice since 1994. It would also establish annual ordinary sessions for the WIPO General Assembly and other Assemblies of the Unions administered by WIPO. It is to be noted, as stated by the document, that since 2000, the WIPO General Assembly has met at least once every year, 8 times in ordinary sessions, and 16 times in extraordinary sessions. To date, none of these amendments has entered into force because WIPO did not receive the requisite number of notifications of acceptance. The 1999 amendment now has 53 notifications out of the 129 needed, and the 2003 amendment has 19 notifications out of the 135 needed. New Special Projects, Office Space, Day-Care, Cloud Services Also on the PBC table for approval by member states is a document [pdf] presenting two Supplementary Capital Master Plan Projects. The document notes that as of 31 December 2018, the WIPO special projects reserve is projected to amount to CHF27.8 million (US$28 million). The first proposal is for the establishment of a long-term capability for WIPO to use cloud service providers, for an estimated total of CHF 3 million. The second proposal deals with the need for additional office space, resulting from an increase of the headcount on the WIPO campus, and the need for more small-to-medium-sized meeting rooms. The document notes that the rental contract of one of WIPO’s rented premises will expire at the end of 2019, and the cost of this rental is expected to increase by nearly 94 percent as of 2020. In order to make positions at WIPO more competitive, the secretariat also suggests the creation of a day-care centre for its staff. “Given the limited range of tools that the secretariat can use to make the overall compensation package more competitive, offering day-care services would be seen as attractive to existing and potential staff, in particular women,” the document says. The PBC is also expected to take note of the WIPO Annual Report [pdf] on Human Resources [pdf]. Image Credits: Catherine Saez Share this:Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Facebook (Opens in new window)Click to email this to a friend (Opens in new window)Click to print (Opens in new window) Related Catherine Saez may be reached at email@example.com."WIPO Program And Budget Committee Meeting Topics: New Projects, Reform, Rise In Expenses" by Intellectual Property Watch is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.