9:15 AM Sep 27, 1995

US CORPORATE CULTURE INTO UN SYSTEM ?

Geneva 27 Sep (Chakravarthi Raghavan) -- Mergers, by friendly or hostile raids on companies with good reserves, and thereafter demergers to split and spin off profitable parts leaving loss-maker shell companies, and "globalising" production and distribution to different locations, is part of the corporate scene of the 1990s, particularly in the United States.

If the United States administration has its way at the ongoing meetings of the Governing Bodies of the World Intellectual Property Organization (WIPO), and it is a big 'if', this culture may be infiltrating the intergovernmental scene of the UN system.

The United States has put forward proposals that are aimed to ultimately achieve the separation of the WIPO general normative and other activities from its very profitable and revenue earning activities of the Patent Cooperation Treaty and similar activities and relocate the PCT department elsewhere than Geneva.

The intention, some observers said, seems to be to relocate the PCT department, a money spinner, in the United States (at San Francisco in the State of California) and later have it spun off the WIPO.

However the Europeans and the Asians appear to have decided to oppose the US proposals.

The WIPO, and its international bureau (the secretariat), housed in Geneva, is an umbrella organization which administers a number of treaties and conventions in the intellectual/industrial property area, including the Paris Union conventions on industrial property and the Berne Convention on copyright.

While the administrative budget and costs are apportioned among its members (who vary from one to another of the governing bodies of the individual treaties and conventions), the WIPO also administers the Patent Cooperation Treaty (PCT) and related registration activities of the Madrid and Hague Conventions.

All these have computerized international registers and documentations on all patents, trade marks, industrial designs etc. and provide access to users, including the private sector, who pay user fees, and thus earns WIPO revenues.

Of the total income of about 239 million swiss francs under all heads for the biennium 1994-1995, the fees activities produced 173.1 million. For the next biennium, 1996-1997, of the total income of SF. 306.8 million, the fees activities of the PCT and related activities will produce 245.6 millions.

These sources of income have made the WIPO, unlike the UN and other agencies, slightly more independent of and immune to the vagaries of the rich countries, in particular the United States and its Congress, which often uses its large budget 'contributions' to threaten to withhold them as a leverage.

The PCT though is growing and its needs of office space has resulted in a proposal from the WIPO Director-General for constructing an annexe to the main WIPO building to house it.

The Director-General had put forward a proposal for a temporary extension of the existing premises at a cost of some 4.226 million francs (with a demolition cost of 290,000 francs), while a new building cost is estimated at 11 million francs.

The cost of temporary rental of premises for three years is put at 4.1 million francs, almost same as that of temporary construction.

The DG's proposal suggests that both could be financed would of the Special reserve Fund - without any impact on the WIPO budget.

In a draft proposal tabled by it, the US has proposed deferring a decision on expansion of existing WIPO premises, on a temporary or permanent basis for one year and accommodate the increased staff within the existing premises, and for submission of alternative plans for premises to be put forward by the WIPO bureau.

The US has then gone to propose that the WIPO bodies take a decision to invite interested governments to present offers to house the WIPO's PCT department in their respective countries.

It is known that the US wants to get the PCT relocated in the US in the City of San Francisco in California (a state crucial for Mr. Clinton's re-election campaign).

There are some who tend to view this as merely an attempt by the administration to show Congress that the US is keeping a tight control over the international organizations and their funding, but others see it differently.

These said that in opening up the arena for 'bids' for locating the PCT department elsewhere, and in effect away from direct supervision and control of the WIPO and its international bureau here, the US is opening up a process that could lead to 'spinning off' the PCT from the WIPO in due course.

One observer noted the repeated calls in New York from the US Representative to the UN for "privatization" of several UN activities and the drive by the US Congress and administration to introduce a "market approach" and suggested the US corporate culture of "raids", mergers and demergers may as well be brought in as part of that culture.