TRIPS Council: Fears That Non-Violation Complaints Could Undercut Flexibilities In IP Trade Rules

World Trade Organization committee members this week were asked to recommend to the upcoming ministerial conference whether to lift or indefinitely prolong a moratorium shielding intellectual property from complaints between members not involving a breach of a WTO agreement. Short of a consensus, the intellectual property committee will have to reconvene next month to try to find agreement. Separately, a two-year extension was granted to countries not yet having ratified the public health amendment to WTO IP rules.

The WTO Council for Trade-Related Aspects of Intellectual Property Rights (TRIPS) met on 19-20 October.

At least two developed countries held their position that the moratorium should be lifted, but a range of developing countries feared reprisals for IP-related actions if this were the case, arguing it would “upset the delicate balance” in the TRIPS agreement.

The same scenario as in 2015 was repeated this year as WTO members could not agree on whether non-violation complaints could be brought under IP rules (IPW, WTO/TRIPS, 23 November 2015).

A repeatedly renewed moratorium currently prevents such complaints from including IP rights.

Non-violation complaints allow a country to take another country to the WTO Dispute Settlement Body even if no WTO agreement has been violated, on allegations of deprivation of an expected benefit because of that country’s action.

The TRIPS Council was mandated by a decision [pdf] taken at the last Ministerial Conference in Nairobi (2015) to continue discussing the issue and make a recommendation for the WTO Ministerial Conference in 2017. The 11th WTO Ministerial Conference is taking place from 10-13 December.

The WTO secretariat was requested by some member states to draft informal language that would show what the Council’s recommendation to Ministerial Conference would look like if it were to be modelled on the last ministerial. It prepared this “illustrative” text to facilitate discussion on a further extension of two years of the moratorium, according to sources, but no agreement was found.

According to several sources, as in the past, only the United States and Switzerland continue to be in favour of lifting the moratorium so that non-violation complaints could be allowed in intellectual property.

Switzerland today said in their statement that when extending the moratorium for another two years in 2015, ministers mandated the TRIPS Council to continue its examination of the scope and modalities for non-violation complaints and make recommendations. As no such modalities have been proposed by members since the first 5-year moratorium [in 1995], there is no merit in making a recommendation to extend the moratorium yet again.

A number of delegations, such as China, Bolivia, South Africa, Brazil, Australia, Canada, Ecuador, Argentina, the EU, India, and New Zealand said they would support a recommendation to extend the moratorium for two additional years, the source said.

A 2015 document [pdf] submitted by a number of countries, including Argentina, Brazil, China, Colombia, Ecuador, India, Indonesia, Kenya, Peru, Russia, and Venezuela explained that allowing non-violation complaints under TRIPS is unnecessary and would “upset the delicate balance of rights and obligations in the TRIPS Agreement by elevating private rights over the interests of the users of intellectual property – both within and between countries….” The countries also expressed concern that non-violation complaints under TRIPS might limit the use of flexibilities built into the agreement.

Brazil, in its statement, said non-violation complaints would jeopardize the use of exceptions and limitations for the development of laws and public policies focused on the protection of public health, among others.

To these concerns, Switzerland responded that NVCs are part of and protect the balance of rights and obligations in the WTO Agreements as approved in the Uruguay Round, according to a source. Protecting this balance did include the flexibility provisions foreseen and confirmed in the TRIPS Agreement. Accordingly, recourse to such a flexibility was a foreseeable measure and was thus not be considered a non-violation situation, they said.

The agenda item had to be suspended and according to sources, an additional meeting of the TRIPS Council will have to be convened so that a recommendation can be submitted to the General Council, and through it to the Ministerial Conference in December, according to sources

The last General Council meeting before MC11 is scheduled for 30 November-1 December, which means that the TRIPS Council’s recommendation to be included in the TRIPS Council Annual Report has to be agreed upon by 17 November.

According to sources, the non-violation complaints moratorium is closely linked to a moratorium on e-commerce. The moratorium on e-commerce lifts customs duties on electronic transmissions. Both moratoriums have been extended at each ministerial conference.

Public Health Amendment: Two More Years to Ratify

After the first and only amendment to the TRIPS agreement went into effect on 23 January (IPW, WTO/TRIPS 23 January 2017), remaining WTO members had until the end of 2017 to ratify the amendment. Some 46 members still have not proceeded to ratification. The list of the 118 countries that have ratified the amendment is here.

Yesterday, WTO members at the TRIPS Council agreed to extend the deadline. According to a source, a four-year extension was favoured by least-developed countries, while the majority of the membership opted for a two-year extension, which was retained in the end.

The amendment (new Article 31bis) brings a solution to Paragraph 6 of the 2001 Doha Declaration on TRIPS and Public Health, and allows countries producing generic medicines under compulsory licence to export all of the medicines to least-developed countries lacking manufacturing capabilities.

IP and the Public Interest v. IP and Innovation

In what some consider to be two sides of the same coin, the TRIPS Council agenda this week included an item on IP and innovation, and an item on IP and the public interest. The item on IP and innovation focused on inclusive innovation and micro and small and medium-sized enterprises trade, and was introduced by Australia, the European Union, Japan, Switzerland, Taiwan, and the US.

Following the introduction at the last session of the council of an item on IP and the public interest, Brazil, China, India, and South Africa requested that discussions continue on the use of compulsory licences.

According to sources, countries delivered statements on both items. These items, according to proponents, are meant to encourage discussion between countries.

India’s Questions to EU on Goods in Transit – No Answers Yet

India submitted a series of questions [pdf] to the European Union on enforcement of IP rights regarding goods in transit. In particular, India requested documents from the EU, such as a list of all the applicable custom laws issued by the EU that could be in the form of regulations/directives/guidelines. India also asked if the EU could clarify whether EU Regulation 608/2013 [pdf] is directed only at goods intended and/or suspected of entering in the EU market. An issue arose some years ago of pharmaceutical goods shipped from India destined for South America and elsewhere being seized as they passed through Europe despite not being intended for the European market.

According to several sources, the EU did not answer those questions, saying that they were submitted days before the meeting of the council and said they would provide answers later.

ARIPO, OAPI Permanent Observers; UN Agencies and Others Blocked

A number [pdf] of international intergovernmental organisations have been requesting observer status at the TRIPS Council for some time. The list includes the African, Caribbean and Pacific Group of States, Biodiversity International, the International Vaccine Institute, the Latin American Economic System, the secretariat of the Convention on Biological Diversity, the South Centre, and the United Nations Environment Programme.

None of those were accepted by the council, according to sources.

However the Organisation Africaine de la Propriété Intellectuelle (OAPI), and the African Regional Intellectual Property Organization (ARIPO) were both granted permanent observer status, sources said. Until now, according to a source, they had ad hoc observer status on a meeting-by-meeting basis.

The European Free Trade Association (EFTA) and the Cooperation Council for the Arab States of the Gulf (GCC), also benefitting from an ad hoc observer status, will be invited again to attend the next council meeting on an ad hoc basis, the source said.

 

Image Credits: Catherine Saez