WIPO Sale Of Madrid Union Real Estate In Geneva Comes Under Scrutiny 10/09/2018 by William New, Intellectual Property Watch Leave a 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 UN World Intellectual Property Organization’s 7 million Swiss franc sale early this year of a building providing revenue to the Madrid Union on trademarks is being looked at more carefully this week after the WIPO external auditor flagged it. Meanwhile, WIPO members are considering a recommendation to raise fees on international trademark registration for the first time in 20 years. WIPO headquarters In his report to the WIPO Program and Budget Committee today, the external auditor recommended that WIPO member states take a closer look to ensure market value was obtained for the sale after it was sold without a competitive process. The external auditor’s report is available here [pdf], with the discussion on the property sale starting on bottom of page 14. WIPO staff to the external auditor responded in writing and took to the podium today to assure member states that in its view a good deal was made for the building, which was situated in the Meyrin area of Geneva, in the vicinity of the airport. The proceeds from the sale will be accounted for in 2018 and reported in accordance with the standards and the current practices of financial reporting by the Union, according to a WIPO press officer. An element of disagreement is whether the property was subject to WIPO regulations for investments or those for property. WIPO says it was an investment-related action and therefore not subject to the competitive bidding requirement. The external auditor said it is property and therefore required to be put out for competitive sale. WIPO’s Financial Regulations and Rules are available here [pdf]. WIPO says it fell under regulation 4.11 on investments, while the auditor said it would be under regulation 5.11, rule 105.31, on property. WIPO told members today it is confident it obtained a competitive price. The property was sold to Rolex Pension Fund (this is Switzerland after all), which already owned four of the five blocks in the building, for CHF 7 million on 31 January 2018, and the funds were received by WIPO in February, according to the external auditor’s report. In October 2015, WIPO received a valuation of the building by CBRE in Geneva of CHF 6.2 million, and recommended that further analysis should be done due to volatility in the market. Just three months later, in January 2016, WIPO received another valuation, by Analyses & Developments Immobilierssarl (ADI), that put it at CHF 5.3 million. That was two years before the sale, and the external auditor said no further consultations had been done by WIPO. But a WIPO official told member states today that the two firms were contacted about the offer of CHF 7 million before the sale and both agreed the price was in line with market standards. He did not provide any details on who made these contacts or how they were made, and a question on that that point to WIPO was not answered by press time. WIPO also stated that real estate prices in Geneva were considered to be in decline in the period, and said the building would need significant renovations costing about CHF 1 million by any buyer, making it less attractive. A WIPO official added on the plus side that the direct sale meant there were no fees paid, which can sometimes be up to 3 percent of the sale. “WIPO believes this was a reasonable value,” the official said. According to past WIPO documents (such as here [pdf] and here), the property was purchased in 1974 as an investment, following a 1972 decision, and a mortgage was secured in 1975 of 1,820,000 Swiss francs. It remains up to the Program and Budget Committee meeting this week to decide whether to send the issue on to the annual meeting of member states, the General Assemblies, starting on 24 September. The developed countries group (Group B) raised “concern” about the issue today. Fees Heading Up for WIPO Trademark Registration? Separately, the external auditor addressed various other aspects of the Madrid System for international registration of trademarks, including its need to increase its budget. Recommendation 9 of the external auditor’s report states: “We recommend that the Management review the existing fees structure with a view to making the Madrid Union self-sustaining, after carefully weighing its impact on the accession of new members and on the usage of Madrid System.” Fees for using the Madrid System have not gone up in 20 years, according to the report. Today in the PBC meeting, Japan noted that the 2015 General Assembly agreed that by the 2018/2019 biennium, each union at WIPO would have to be self-sustaining, so it supports recommendation 9. Switzerland, meanwhile, said the system does not anticipate a budget and shows an positive trend, so “there is no cause for concern for immediate action.” 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 William New may be reached at firstname.lastname@example.org."WIPO Sale Of Madrid Union Real Estate In Geneva Comes Under Scrutiny" by Intellectual Property Watch is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.