TRIPS Public Health Amendment Questioned; China Implements Decision

Hong Kong–China’s recent decision to implement World Trade Organization rules making it easier for poor countries to import cheaper medicines was discussed at a non-governmental organisation meeting at the Hong Kong ministerial today, as questions swirled around the recent decision by WTO members to an amendment establishing these rules.

On 29 November China issued an order implementing a WTO waiver from 30 August 2003 under which countries are allowed to export medicines to countries with inadequate or no production facilities. The waiver was made permanent in an amendment to the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) on 6 December (IPW, WTO/TRIPS, 6 December).

The Chinese decision will come into force on 1 January 2006, according to the Chinese State Intellectual Property Office.

Carlos Correa of the University of Buenos Aires said in an interview that China now joins countries that have implemented the waiver or are on the verge of doing so, including: Canada, European Union, India, the Netherlands, Norway, Korea.

But the Chinese implementation is more limited than the Canadian one, Correa said referring to an unofficial translation of the Chinese order. He said the Chinese order only applies to “infectious diseases” while the WTO agreement includes all diseases.

On the plus side for users, however, the Chinese decision says it is not necessary to negotiate with the patent holder prior to applying for a compulsory license, Correa said. This is important as the patent owner can delay the decision if negotiations are required, he said.

Also, the Chinese order does not, unlike the Canadian decision, indicate the exact remuneration or royalties that are to be paid to the patent owner, only that they have to be adequate, and this can create uncertainty, Correa said. Under the TRIPS amendment, remuneration has to be paid to the patent holder in the exporting country, he said.

Only a Smoke Screen?

Ellen ‘t Hoen of Médecins Sans Frontières said that the TRIPS and public health decision reached immediately before WTO officials departed for Hong Kong had been “mentioned a great deal” at the ministerial and thus was being misused so that an announcement could be made in Hong Kong of progress in the Doha negotiating round, as MSF had feared it would be (IPW, WTO/TRIPS, 7 December).

The big question in the corridors at the ministerial among those following TRIPS issues is why the African countries agreed to making the waver permanent when it has never been used.

‘t Hoen said MSF was “very puzzled” when this “very unwise decision” had been made in Geneva. She said the idea seemed to be to “put up a smoke screen” mentioning the “success” of the deal amid little progress in the other areas of the Doha negotiations, which are intended to focus on development. In particular, she said, the agreement was rushed for a political reason in order for the WTO to have “something to show” that indicated that “Doha is good for development,” while the medicines issue was sacrificed in this process.

‘t Hoen said she feared that the WTO considers the medicines issue finished and does not want anything more to do with it. She said everyone had a “collective responsibility” to make sure the WTO did not get away with that. But she said, it is not likely to be possible to “un-amend it” at the ministerial.

An African delegate confirmed this, saying that the public health issue was closed and would not be opened again at the ministerial, but would be mentioned in the final report on the Doha round.

German Velasquez, associate director of the department of technical cooperation for essential drugs and traditional medicine at the World Health Organisation, told Intellectual Property Watch that the Africans had been pressured by the United States, the EU and the WTO Director General Pascal Lamy to reach an agreement because they wanted to announce it at the ministerial as no progress had been made in other areas.

He noted that a whole week of informal meetings on the issue had been held in which countries such as Argentina, Brazil and India had not been consulted in order to isolate the African group. Velasquez said the 30 August 2003 decision had also been reached one week before the WTO ministerial in Cancun.

At a press conference with the African Union, officials did not offer explanations of their agreement to the amendment. The Rwandan trade minister would only say that the inclusion of TRIPS issues on the ministerial agenda has been “very pertinent in our discussions.” Referring to the public health decision, he said, “our group has managed to push” the issue.