May 3, 1991

WIPO: PATENT HARMONISATION MEET IN JUNE WILL DISCUSS, NOT DECIDE.

GENEVA, MAY 2 (CHAKRAVARTHI RAGHAVAN) – The Diplomatic Conference for a Patent harmonisation treaty under the auspices of the WIPO at The Hague in June will discuss the Basic Proposals but will not take any final decisions on articles and conclude a treaty.

This will be left for a second part of the Conference to meet perhaps towards the middle of 1992.

The Conference, set for June 3-28, will now meet in the first part from June 3-21 to "discuss articles of the Basic Proposal" while a second part, on dates to be suggested by the diplomatic Conference and set by the Paris Union Assembly of WIPO in September, will take final decisions on all the articles.

Though unseated, this would seem to depend on the TRIPs negotiations in the re-started Uruguay Round negotiations, as well as the United States ability to yield on its long-standing disputes with Europe over the "first-to-file" or "first-to-invent" issue on patents rights.

This was the outcome of an extraordinary session of the General Assembly of the International Union for the Protection of Industrial Property (the Paris Union), convened at the instance of the European Patent organisations and held here on 29-30 April.

The Patent harmonisation issue has been on the WIPO agenda since 1983 so to say, but picked up some steam in the context of the Uruguay Round negotiations on TRIPs which would have involved loss of jurisdiction for the WIPO and would have subjected countries to trade sanctions for failure.

But when the WIPO initiative was ultimately allowed to move forward to the fixing of a diplomatic conference, it had been assumed by everyone that the Uruguay Round negotiations would have ended one way or another.

The U.S. and other ICs had also been thinking that if the negotiations ended successfully, its provisions could be translated into the WIPO harmonisation treaty, and that if the TRIPs negotiations did not succeed they would have an opportunity to pick up the pieces again and push for uniform standard in the world through the WIPO harmonisation process.

The failure at Brussels of the negotiations as a whole, and their re-start now (though facing an uncertain future, including on the U.S.-EC differences over the first-to-file or first-to-invent issue) has thus put most participants in a fix.

A number of Third World countries under considerable bilateral pressures from the U.S. in the Uruguay Round, do not want to yield and compromise their positions in the Patent Harmonisation treaty negotiations at a time when the Uruguay Round TRIPs negotiations are on and, where, if they do make some concession, it would be in return for trade concessions to them elsewhere.

In the patent harmonisation on the other hand the compromises would be within the process where several Third World countries they have little to gain.

While the patent harmonisation treaty negotiations involve South-North differences with most of the countries of the South preferring a treaty-dealing with procedures rather than substance, there have also been important differences within the North.

The major ones relate to the issue of "grace period" (the harmonisation of this was the original motive for the patent harmonisation initiative in the WIPO) where the Europeans would have to compromise; to the procedure for prior examination and objections where the Japanese would have to yield, and the U.S. law which provides for patents on the basis of "first-to-invent" and riot "first-to-file" prevalent in most ICs.

The "grace period" refers to the period for public disclosure of an invention before filing an application without affecting the patent rights or patentability of the invention claimed. Discussions on harmonising this led to the view that it could not be solved in isolation and thus the effort in WIPO for harmonisation of patent law provisions across a wide front.

The provision in patent law for prior examination and objections being heard before grant of a patent, which prevails in Japan has enabled that country to keep out new patents of other countries off its market thus breaking the competition edge of new patents in high-technology areas.

The issue of first-to-invent vs. first-to-file involve some substantive and procedural issues.

It is also an issue dividing the U.S. from the EC and other ICs in the Uruguay Round TRIPs negotiations.

The grant of a patent monopoly for a limited period is given by the State in lieu of public disclosure and thus spread of knowledge of the invention for public benefit.

The firs-to-file and thus first one to publicly provide the information is hence viewed as two sides of the same coin. It settles the issue of who owns the patent on the basis of filing date, which is also simple and easy of administration.

In the U.S., the patent right goes to the first to invent.

Apart from the conceptual conflict in this with the patent monopoly theory, the first-to-invent provision is a fruitful field for patent lawyers and provides them their bread and butter litigation, even if it is unsettling for others in industry and public.

The patent lawyer community, which is very powerful part of the Patent Lobby in the U.S., has been steadfastly opposed to any change in the first-to-invent law.

The U.S. has recently acknowledged that it would be unable to do this quickly and has put forward proposals for the Patent harmonisation treaty to reflect this.

The administration hopes that over time, under pressure from abroad, it would be able to prevail over the patent lawyer lobby and change to the first-to-file system, but is unready to commit itself as it would be unable to deliver.

The EC and Japan have said that any changes in their laws would be possible only as a part of a big package which would involve the U.S. changing to a first-to-file system.

When the U.S. circulated its position, the European patent offices grouped in the so-called Munich Club discussed it and though there was no consensus, several of them moved to get the Patent Harmonisation treaty conference postponed.

Though they did not initiate it, a number of Third World countries also were in favour.

After debate in the WIPO Paris Union Assembly and prolonged consultations, a compromise decision wag reached under which it was agreed that The Hague diplomatic conference would be held as set, but in two parts:

* The first part 3-21 June, will discuss the articles of the Basic Proposals, and

* The dates of the second part will be recommended by the diplomatic conference in its first part and considered by the Paris Union Assembly at its regular session in September this year. It is hoped that this second part will take place towards middle of 1992.

The compromise stipulated that the Assembly in adopting this decision understood that "the final decisions on all articles would be made in the second part of the Diplomatic Conference".