THIRD WORLD RESISTS EXPANDING TRIPS MANDATE.

Jun 16, 1987

THIRD WORLD RESISTS EXPANDING TRIPS MANDATE.

GENEVA JUNE 11 (IFDA/CHAKRAVARTHI RAGHAVAN) -- Third world countries have rejected what is seen as a concerted effort by industrialised countries to alter the Uruguay Round mandate and use GATT to forge new conventions to expand the scope and adequacy of intellectual property rights (IPRS), as well as procedures for their enforcement.

At this week's meeting of the GATT negotiating group on Trade-Related aspects of Intellectual Property Rights (TRIPS), Japan, EEC, U.S. and the Nordic countries presented submissions outlining their ideas on what the group should o, and these sought to focus the negotiations on the adequacy, availability and scope of IPRS, participants at the meeting reported.

Participants said that a number of delegations, representing a wide cross section of third world economic and development strategies, insisted that the only issues that could be dealt with in GATT were those relating to "trade", and the distortions to trade or non-tariff barriers (NTBS) created by IPRS.

Legal and juridical issues relating to protection or enhancement of intellectual property rights, these delegations insisted, had to be addressed in international forums where these were being dealt with, and the GATT negotiations could not be used for this purpose.

Intellectual property rights, they reportedly underlined, were not "god-given rights" but of recent origin, created by domestic statutes and international conventions, where the rights of the holders were balanced with societal interests and individual country needs and socio-economic policies.

These could not be changed through GATT to enhance the rights of property holders as if the rights had been created to promote trade, and the work in the group should hence be strictly governed by the Punta del Este mandate.

In another context, the EEC commissioner Willy De Clerc reportedly told GATT diplomats here Thursday that the Punta del Este mandate should not be changed by "guerrilla tactics".

De Clerc reportedly made these remarks at an informal lunch with some key diplomats to explain the EEC reading of the Venice Summit communique, and the EEC rejection of efforts (of the U.S. and Cairnes Group) in agriculture negotiations or to achieve an "early harvest".

De Clerc was told by some third world diplomats that the EEC view about "nothing more and nothing less than Punta del Este", applied not merely to agriculture but to all sectors, including intellectual property rights, investment and services.

The TRIPS negotiating group is reported to have agreed to recommend to the group of negotiations on goods (GNG) that the Secretariats of World Intellectual Property Organisation (WIPO) and the Customs Cooperation Council (CCC) be invited to attend formal meetings of the group, and provide appropriate technical support for negotiations, to complement the expertise primarily available from participants.

The GATT Secretariat is to prepare for the next meeting of the group, on the basis of the written submissions already made and those submitted by mid-july, and oral submissions and views of delegations at meetings of the group, a factual and generic compilation of issues considered relevant to the negotiations by participants.

The written submission, from the U.S., the EEC, Japan and the Nordic countries have made some general statements of how trade problems related to IPRS had grown considerably and, without relating them to any GATT rights of rules, have gone to argue for enhancing existing IPRS, expanding the period for which the rights would be available, as well as extending it to new sectors, and for products and not merely processes.

Under the Paris Union Conventions, each country has the right to formulate its national policies in these matters, and subject to some broad principles in the Conventions, have a great deal of autonomy in decision-making, to suit their particular needs and conditions. However, all the IPRS should be available without discrimination to nationals of the country and those of member-countries of the Paris Union.

Countries have the right to decide the areas of activity to be protected, the duration for which the rights would be recognised, and the conditions for grant of such rights.

Many third world countries, and till recently even several industrialised countries, did not extend patent protection (and with the importing monopoly rights) to food, chemical and pharmaceutical products, giving protection only to the processes for manufacturing these products.

All the submissions have sought to change this.

Also, some like the U.S. have sought to create new rights as for plant breeding, integrated circuits, designs, etc..

U.S., Japan, EEC and the Nordics have also sought to secure, through the GATT negotiations, the right of patent holders to enjoy patent rights in any country without working the patent, and thus enjoy monopoly importing rights.

The argument for this, as propounded by Japan for example, has been that the "environment" of a particular locale might not be suited for the operation of factories, etc. (for working the patents), and importation of products would well serve the market, and the patent-holder should not be forced to work the patent.

The rights of countries to compulsorily license the working of the patent or to regulate the conditions of licensing (to stipulate the royalty to be paid, or to regulate or eliminate "restrictive practices" in licensing, etc.) is also sought to be changed, and the duration of the patent rights, before they pass into the public domain, sought to be increased.

The U.S. has specifically also sought to bring into the GATT negotiations, the issue of IPRS in "services", while the EEC without actually saying so has sought to cover areas other than goods, like computer software, etc.

Third world countries generally and specifically rejected these efforts, participants said.

Yugoslavia reportedly said that the submissions went far beyond the Punta del Este mandate, duplicated work in WIPO, and were not related to any GATT articles or rights.

Zaire said none of the submissions related to trade or trade issues or problems, but raised legal issues relating to existing conventions. The issues of country legislations, duration of IPRS and/or narrow scope of protection were legal problems that were dealt with in the Paris Conventions and in WIPO.

The GATT negotiations could not be used to adopt a new convention on counterfeiting or strengthen or amend existing WIPO conventions, which had their own membership and procedures, and machinery to change them.

Brazil reportedly said the mandate was not to establish a new IPR system from scratch, but identify aspects of laws and treaties in force whose implementation were having negative effects on trade.

The IPR system was "a very complex and sensible mechanism, to which trade aspects are relevant but secondary". Patens were not granted merely to protect an invention, but to establish "an equitable legal basis" between the inventor and the society at large, where both sides had interests and responsibilities.

National laws, requirements and regulations came within the scope of GATT only to the extent they affected some aspects of trade, and that too in products. And these were those related to "sale, offering for sale, purchase, transportation, distribution and use of goods", and did not refer to "editing of a book, licensing of a trademark or staging of an opera" nor could it deal with regulations that only indirectly or occasionally affected trade.

India reportedly pointed out that they were concerned with enforcement of existing intellectual property disciplines and not creating new ones, and with trade-related aspects of such rights and not rights per sec.

The GATT provisions did not create any rights or rules for trade, but dealt with the issue within the scope of "general exceptions" to the GATT rules, and sought to ensure that measures taken by countries within the scope of the general exceptions did not discriminate and were not arbitrary.

The negotiations within the group could only deal with distortions to trade or NTBS arising out of excessive or inadequate protection of IPRS, and not with IPRS themselves or create and extend rights, governed by other international conventions and organizations.

Among the distortions and NTBS to world trade through IPRS were those created by TNCS through their restrictive business practices, and the negotiations had to deal with them.

Citing instances where, pharmaceutical companies had been known to have charged in particular markets prices 40 times the cost of the product, the Indian delegate reportedly suggested that the Japanese and other complaints about "insufficient remuneration" and efforts to restrict government rights to regulate these, had to be seen in this context.

Whether the environment in a country was suited to work the patent or not could not be left to the judgement of the TNC holding the patent, and had to be decided by national regulations which were formulated for national objectives.

The industrial property system had wider implications than trade, and included its role as an instrument of development and its role in transfer of technology, and this had been the subject of a UN Secretary-General's report and of extensive discussions in other fora for over a decade.

The present system where TNCS hold 90-95 percent of patents registered in the third world, had been recognised to be "a reverse system of preferences granted by developing countries to external patent monopoly holders", and hence the move for revision of the Paris conventions, and it could not be dealt with in GATT.

Argentina agreed that a whole range of problems had been raised in the submissions which went far beyond the mandate of GATT or of the negotiating group.

Tanzania reportedly pointed out that almost everything raised in the submissions were under discussion in WIPO and in the diplomatic conference for revision of the Paris Convention.

Egypt supported the view that the perceived adequacy or otherwise of IPRS was outside the scope of the GATT negotiations.

Hong Kong agreed that the negotiating objective did not allow any aspect of IPRS to be examined, but only those falling within the rubric of trade-related aspects like distortions or impediments to trade. But any aspects relating to these could be dealt with by the group, whether or not it was being considered elsewhere.

On the issue of trade in counterfeit goods, Brazil is reported to have pointed out that the problem of customs control of counterfeit goods was covered by the 1891 Madrid agreement to which Brazil was an original signatory, and the Convention had now 32 members, including eleven from the third world, but not Australia, Canada or the U.S.

Those who talked about the need to fight trade in counterfeit goods should sign the Madrid Agreement, as a preliminary to any further discussion on this subject, the Brazilian delegate suggested apparently in response to the U.S. call to countries to sign a draft treaty it had prepared and tabled, and the bilateral efforts of the U.S. in this direction.

Extending the Madrid Agreement to cover trade-markets, Brazil reportedly argued, was be an easy task in the context of the Paris Union, and a more active role by WIPO would prevent duplication of efforts in GATT.

Apart from Brazil, industrialised countries including the EEC, Norway, Japan and Australia all rejected the U.S. draft code as inadequate and with enforcement measures "not sufficiently dissuasive". The EEC argued that it was not merely enough to deal with counterfeit goods at import end, but also at export and production end.