By Dugie Standeford and Kaitlin Mara
The World Trade Organization Trade-Related Aspects of Intellectual Property Rights Agreement (TRIPS) is being “recalibrated” as developing and developed countries challenge old assumptions, Vanderbilt University law professor Daniel Gervais said this week. The first international accord to link intellectual property and trade has entered its third “narrative,” in which IP is no longer isolated from other rights but is part of national innovation strategy, Gervais said.

Separately, WTO stakeholders including several government officials discussed the future of TRIPS at an event in Geneva sponsored by the UN Conference on Trade and Development and the International Centre for Trade and Sustainable Development.

Gervais delivered the Fourth Annual Finnegan and Henderson Distinguished Lecture of IP at the American University Washington College of Law on 21 October. His background includes stints at the WTO and World Intellectual Property Organization.

TRIPS 1.0, the “addition narrative,” held that adding IP to national law would produce good results by fighting piracy, creating a “middle class” of nations in the developing world, and spurring economic development, Gervais said. TRIPS 2.0, the “subtraction narrative,” began when patents on HIV/AIDS and malaria drugs emerged in Brazil and elsewhere in the developing world, he said. When drug companies failed to handle the situation well, the analysis of IP policy switched from its benefits to its negatives, including “rent extraction” from poorer countries by richer nations.

Empirical data on the impact of IP on developing countries emerged that showed that there are different kinds of IP and users, that IP “is not woo-woo” (magic), and that countries would have to do more than comply with TRIPS to receive its benefits, Gervais said. The problem is that while IP is a precursor to foreign direct investment, FDI itself does not guarantee innovation.

That led to TRIPS 3.0, the “calibration narrative” that asks whether IP can be viewed as a trade right to accommodate the differences between the “biodiversity” of products and users (pirates and consumers, for instance).

But IP is now one of many rights protected by various trade agreements. The WTO Appellate Body says TRIPS cannot be read in “clinical isolation” from other international law, which seems to mean that non-IP rights – such as access to knowledge and the copyright moral right – can be brought in to interpret WTO agreements, Gervais said. Traditional knowledge has “huge heft” in developing countries seeking to counter IP rights, he said.

The calibration effort goes beyond what TRIPS was thought to be about – namely, standardising IP, Gervais said. Developing nations now say they want national policies to close the gap between IP law and innovation. The challenge is not to implement TRIPS mechanically in order to stay out of trouble but as part of a national innovation strategy. At the same time, the West is also recalibrating IP, although in a different way, by questioning patent law excesses, software patents and the US Digital Millennium Copyright Act (which strengthened rightsholders positions).

Developed and developing countries are beginning to question innovation assumptions as well, Gervais said. What is the state’s role in innovation? Are the interests of multinational corporations those of the United States and the European Union? Does the recent American and European focus on piracy mean their IP priorities and roles have changed? Has TRIPS’ innovation potential been removed? And more profoundly: Can innovation thrive only in capitalist (read democratic) societies? Is the US form of capitalism the best?

Innovation must be at the top of the US agenda in the current environment, Gervais said. America now competes with new entrants for innovation and can no longer assume that it can remain a unilateral player in IP. Future negotiations will not result in “pure more-IP agreements” because some developing countries want a stronger voice on innovation policy while others want to bring in other rights to reshape IP altogether, he said.

WIPO may have lost some credibility but in this complex, new environment its Development Agenda could close the gap between IP norms and innovation, Gervais said. He urged it to take the lead on innovative policy research. TRIPS amendments are unlikely, but the WTO could rely more on ministerial declarations to bring flexibility to trade accords, he said.

Amending TRIPS

Meanwhile in Geneva, stakeholders discussed “The Future of TRIPS Issues in the Doha Round,” at an event co-hosted by the UN Conference on Trade and Development and the International Centre for Trade and Sustainable Development, also on 21 October.

Proposed changes to TRIPS are: an amendment to TRIPS protecting biodiversity and traditional knowledge as defined by the UN Convention on Biological Diversity (CBD); creation of a register for geographic indications (GIs), product names associated with specific locations and characteristics; and the possible extension to other products of the higher-level protection on GIs currently enjoyed by wines and spirits.

A strategic alliance between those supporting GIs and those supporting CBDs was formed in the lead-up to the July mini-ministerial meeting of the WTO (IPW, WTO, 9 June). This loose-knit group released a set of draft modalities, or ways forward on these issues, which is available here [pdf].

The group represents over two-thirds of WTO membership, noted Sunjay Sudhir of the Indian mission at the ICTSD/UNCTAD event. This coalition is “still a coalition,” even after the stumble in the Doha negotiations at the WTO this summer, said a Latin American official to Intellectual Property Watch on a separate occasion.

“These issues,” said Sergio Balibrea of the European Commission, “will not go away and ministers will tackle them at modalities,” or negotiations on steps forward, adding that GIs “protect age-old culture and traditions” that there is “no objective reason” why wines and spirits should have more protection than, for example, Parma ham.

But not everyone is keen to see changes made to TRIPS. There is “very little chance” the United States would agree to the GI issues, said Fred Abbott, a professor at Florida State University College of Law, because its food industry “does not reflect a high level of concern over foreign denominations” and agreement would require a recalibrating of the industry.

And Chile is concerned about the practical impact of suddenly having many newly registered GIs to protect. Chile had to undertake negotiations with 11 or 12 countries as a result of the WIPO Lisbon Agreement – which protects similar products (IPW, WIPO, 2 October) – to ensure it would keep rights to one of its GIs, said Maximiliano Santa Cruz of the Chilean mission. This took “enormous human and financial resources,” and the country is worried that under the WTO – where there are over 150 members – this could be an even greater problem.

Sudhir said a “lack of political will” on the part of those not interested in negotiating was responsible for slow progress, and that the coalition of “TRIPS proponents” feel that substantial technical work has been done already and that it is “therefore time to seek ministerial guidance and text-based negotiations.” He added that, because no text resulted from informal negotiations between TRIPS proponents and opponents during the July ministerial, when negotiations resume next it will be from the above linked document.

Santa Cruz explained that Chile is an active user and protector of geographic indications – they are “one of the first things we put on the table” in bilateral negotiations, he said – but there is no mandate to negotiate on GI extension. The mandate on TRIPS in Doha only explicitly requires member states to undertake negotiations on a GI register.

Chile is “more open and could even consider accepting” the CBD issue, as it has “critical mass, and clear developing country support.” However it is a “delicate moment” for the Doha round and many are concerned with changing existing mandates, Santa Cruz said. Moreover, Chile rejects the “artificial parallelism” between the GI issues and CBD issues: each has its own terms of reference.

At the WTO General Council meeting (IPW, WTO, 14 October), many expressed continued interest in talks on TRIPS issues. The European Union’s official statement said issues like TRIPS need to be tackled and cannot “simply [be] pushed off the table” in future talks. The statement of India references the “expectation of a vast majority of the membership that the three issues must attain closure as an integral part” of future work.

The next TRIPS Council meeting will be 28-29 October, with a special session on GIs scheduled for 29 October.

Dugie Standeford and Kaitlin Mara may be reached at info@ip-watch.ch.