Peru Attempts Strong WTO Position On Disclosure Despite Weaker US Deal

By Tove Iren S. Gerhardsen and William New

Hong Kong – Peru appears to be taking a strong position in World Trade Organization negotiations in favour of the disclosure of origin of genetic material and traditional knowledge in patent applications despite having agreed to weaker terms in a bilateral trade deal with the United States last week, according to sources.

A copy of an “understanding” connected to the US-Peru bilateral trade agreement reached last week and obtained by Intellectual Property Watch shows Peru agreed to a side letter that highlights the use of contracts on access to genetic resources or traditional knowledge. This is consistent with the US position in the multilateral talks and would appear to differ from a proposal for negotiations on an international requirement for disclosure being promoted by India and Brazil. The agreement is not yet public.

Some developing countries led by India and Brazil seek agreement in Hong Kong for the launch of a negotiation on disclosure requirements. But countries such as the United States, as well as the global pharmaceutical and biotechnology industries, are fighting to minimize the disclosure issue in Hong Kong.

But one government participant in Hong Kong said the clause in the bilateral pact could be interpreted as not being a mandate to use contracts, but rather an acknowledgement that they may be used. This would not preclude an international agreement on disclosure, the source said.

In the letter, there is no mention of “disclosure,” which Peru has fought for during the past decade. The source also said Peru fought for the inclusion in the bilateral deal of recognition of the importance of traditional knowledge and biodiversity, and of requirements other than disclosure.

The side letter states: “The parties recognise the importance of the following: (1) obtaining informed consent from the appropriate authority prior to accessing genetic resources under the control of such authority; (2) equitably sharing the benefits arising from the use of traditional knowledge and genetic resources; and (3) promoting quality patent examination to ensure the conditions of patentability are satisfied.” This is the first time the United States has agreed to the inclusion of such language (IPW, Genetic Resources/Biodiversity, 9 December).

It also states: “The parties recognise that access to genetic resources or traditional knowledge, as well as the equitable sharing of benefits that may result from use of those resources or that knowledge, can be adequately addressed through contracts that reflect mutually agreed terms between users and providers.”

US officials have raised the bilateral agreement in Hong Kong, at least in one-on-one meetings with other delegations, a participant said.

In Hong Kong, the disclosure issue is being discussed in connection with the relationship between the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) and the UN Convention on Biological Diversity (CBD).

Did Peru ‘Sell Out’ in US Deal?

Various sources at the WTO ministerial in Hong Kong said they fear that Peru has ‘sold out’ by settling for a reference to contracts. While Colombia and Ecuador have balked at US terms for intellectual property rights in the bilateral, Peru stayed the course.

Some analysts said the concern is the letter’s paragraph on contracts could mean that companies could negotiate contracts with indigenous communities without any transparency and in this case without any requirements to disclose to the national patent office or others from whom and where they obtained the resources. This has been criticised by those who predict negotiations for such terms would take place on unequal terms (IPW, Genetic Resources, 25 November).

Those who have been supporting Peru in its struggle for the protection of traditional knowledge have expressed concern about the agreement.

Frederick Abbott, professor of international law at the Florida State University College of Law, told Intellectual Property Watch that he hoped that when the senior people who had negotiated the letter fully appreciated its implications for Peru’s position in the TRIPS Council, “they might choose to withdraw the letter from the FTA package.”

Abbott said that it would have been much better for Peru to have nothing at all on traditional knowledge and biodiversity than this letter.

James Love, director of Consumer Project on Technology, said that Peru had been a leader in this area in the past, but the agreement certainly was signalling that Peru was moving towards the US position, and that it was “ready to cave in.”

Vandana Shiva of the Research Foundation for Science, Technology and Ecology in India, said that the agreement was “undoing CBD,” and that it was part of a “divide and rule” strategy. The United States picked out Peru to make it back off the united front with other developing countries, she charged, adding that that was exactly how they had gotten TRIPS in the first place, she said.

Shiva said the United States was afraid of the multilateral route and was operating at the bilateral level, and said the intellectual policy model needed re-visiting.

India previously proposed, under paragraph 12 of the 2001 Doha Declaration, that it should be mandatory for countries’ patent applicants “to disclose, as a condition for grant of the patent, the source and country of origin of the biological/genetic material and associated traditional knowledge used in their invention” (IPW, Genetic Resources, 25 November).

In Hong Kong, India is proposing that text on disclosure should be included in the revised draft of the Hong Kong ministerial text, which was to be presented on 17 December.