WIPO Committee Tackles Program, Budget Issues

The World Intellectual Property Organization Program and Budget Committee (PBC) is meeting this week with a full agenda of issues relating to planning for the next biennium as well as management matters.

The 23^rd session of the PBC is taking place from 13-17 July. The documents for the meeting are available here.

Among the topics on the agenda are the WIPO secretariat’s program and performance report for 2014, and the financial situation for 2014, and the draft proposed program and budget for the 2016/2017 biennium.

Also on the list is a progress report on implementation of UN Joint Inspection Unit recommendations for improving WIPO management and administration, and a discussion of governance at WIPO.

Other key issues include a new policy on investments protecting WIPO’s revenues from a negative interest rate from a Swiss bank, a proposal on the WIPO reserve funds, and a definition of development expenditures.

On the first morning, member states raised points on a number of these issues, as well as topics of interest to them such as the possible opening of further WIPO external offices in other countries, and concerns over budgeting of the newly revised Lisbon System which now includes geographical indications in addition to appellations of origin.

Opening the session, WIPO Director General Francis Gurry told the membership that the organisation made “significant progress” on it program over the past period, and that its finances are sound.

The UN agency has a surplus from the biennium that is drawing to a close, he said, with sizeable reserves, continuing a record of “sound financial management” during his term of office. He claimed the number of staff has remained the same for six years, and that there have been no increases in the fees WIPO charges for its services – its primary source of income.

For the next biennium, Gurry said WIPO will seek an increase in about 5 percent in spending, staying under an expected 6 percent in income.

According to the secretariat’s proposed program and budget for 2016/2017: “Income over the next biennium (2016-2017) is expected to rise by 6 per cent to 756.3 million Swiss francs as a result of growth in demand under the Global IP Systems (principally, the Patent Cooperation Treaty (PCT), the Madrid System for trademarks and the Hague System for designs). We propose that expenditure should rise by 4.9 per cent to 707 million Swiss francs, delivering a projected surplus, after estimated adjustments for International Public Sector Accounting Standards (IPSAS), of 20.8 million Swiss francs, which it is proposed would be used primarily for building the reserves to a more secure level.”

He mentioned several times the uncertainty of the economic climate in which WIPO operates, and said the necessary caution is being taken. He also said that in the coming biennium, significant funds would be targeted toward information technology security at the organisation, given its heavy reliance on IT and the benefits for productivity and savings from investing in this area.

In the document, the director general raised the inevitability of raising fees in the future.

“This continues the outstanding record of the past seven years of no fee increases,” it said. “This record is, however, unprecedented when compared to fee increases in national and regional IP offices and the time will come in the future, naturally, when reasonable fee increases will be needed.”

The United States, whose users contribute a significant portion of WIPO’s budget, raised concern about this prospect of increased fees, arguing that with rising participation in WIPO instruments the fees might be expected to go down, not up.

On a separate note, the United States and others such as South Korea raised concern about the combining of the budget of the Lisbon System and Madrid System. The US argued that Lisbon has never paid for itself and is subsidised by other WIPO instruments, even though Lisbon only benefits a small number of WIPO members. This issue was inflamed by the recent negotiation of a revision to Lisbon to include geographical indications, a divisive issue among WIPO members (IPW, WIPO, 21 May 2015). The US said it would not be able to agree to the biennial budget until this concern is addressed.

Gurry said in his opening remarks that the PBC has to find a balance between providing guidance on contentious issues that are deadlocked in the norm-setting committees, but not become too involved in the technical issues that experts in those committees are handling.

Committees he mentioned include those on genetic resources and traditional knowledge, copyright, trademarks (for a design law treaty), and geographical indications.

He also explained that the proposed plan for the next biennium contains preparations for several diplomatic conferences (highest-level treaty negotiations) for possible instruments in the areas above, but that this is just an attempt to predict the behaviour of WIPO member states in the coming two years.

On external offices, Gurry said “great progress” has been made on resolving disagreements over possible new offices, and is expected to be made known soon.

He also noted a plan to close the WIPO office in New York, which is a liaison office to the UN headquarters, after the next biennium. He detailed the various activities WIPO is involved in with the UN and said these are managed from the Geneva office.

In another area from the first day, a discussion was held on the WIPO Re:Search program, which partners those with patented technology with researchers interested in working on uses for developing countries.

The program suffered somewhat from the withdrawal of a major launch partner, AstraZeneca, when it underwent internal changes, but has successfully shown proof of concept, Global Challenges Division Director Anatole Krattinger told the meeting.

Another issue of debate today was health insurance expenses, which Mexico and others raised as needing to be reined in. A scanned copy of Mexico’s proposed amendments is available here: