Oct 14, 1991

AGRICULTURE, TEXTILES AND TRIPS FOCUS OF NEGOTIATIONS.

GENEVA, 11 OCTOBER (CHAKRAVARTHI RAGHAVAN) Uruguay Round negotiators from capitals return to Geneva Monday to resume negotiations among others on Agriculture, Textiles and Trade-related Intellectual Property Rights (TRIPs) and on Dispute Settlement.

The negotiations have become even more non-transparent than usual. There are opening and closing formal meetings of the negotiating groups, but the real talks are in small informal groups.

While there had been informal consultations at level of local diplomats this week in a number of areas, officially negotiations had been recessed - due to the Telecom exhibition in Geneva and hotel space all taken up months in advance.

At one level, the negotiations have come to a standstill. Dunkel had issued what GATT sources described as an ultimatum to negotiators to come up with agreed texts by end of the month or beginning of next, failing which he would put forward his own revised version of the draft texts of agreements before the Brussels Ministerial meeting, the draft Final Act (MTN.TNC/W/35 Rev. 1).

The sources said that while Dunkel had hoped to prod negotiators, the reverse has happened with everyone sitting still and not giving anything away before the revised text, even if the majors are privately cooking up a deal of their own to present as Dunkel's revised text.

But at another level, in the renewed consultations next week, Third World countries who have been taking a nationalist position to defend their interests will be under very strong pressure, bilaterally from the U.S. and EC as well other ICs, and by Dunkel and Chairmen of the concerned negotiating groups, to yield to the demands on them in new areas and in rulemaking (subsidies, balance-of-payments and other such areas).

They are being told, according to participants, that this is the time for countries of the South to show maximum flexibility and indicate the compromises they would accept in order to enable the Industrial Countries, and particularly the U.S. and EC to move forward in market access issues and enable the EC to make some compromises on Agriculture.

This pressure on developing countries appears to be particularly high in the negotiations on TRIPs, where they are asked to accept high standards and norms, and term of protection for patents, both for process and products, to provide global monopoly and rentier incomes to their TNCS, and give retrospective benefit too through so-called "pipe-line" protection.

One of the long-time observers of these negotiations said. that the pressure is so great on the developing countries to yield more, despite the compromises they have already made, that when the final score sheet is drawn up in countries after everything is signed and done with, those who are justifying the deals in capitals on the ground of having gained concessions in market access including agriculture, would be seen as either the willing or unwilling victims in a con game and rip-off of the developing world.

On Agriculture, Dunkel is to resume the consultations on October 16, but little is expected. Virtually everyone involved is looking to Dunkel to present his own text - on a take-it-or-leave-it basis - and is there no negotiations, but repetition of positions.

Within the European Community, though there is talk of a new flexibility, with the Germans now reportedly willing to back this, France is still holding out. Given the domestic protests of farmers in France, backed by all the opposition, and with important local elections due next year, there is little chance of France yielding on its stand against any more concessions in agriculture and enabling the EC Commission to negotiate more flexibly, some French sources suggest.

Cairns Group Chair, Neal Blewett of Australia who was on a lobbying European tour earlier this month, came to Geneva last week to meet Dunkel and impresses on him that the only way to save the talks was for Dunkel to put forward a take-it-or-leave it text in agriculture.

But while purportedly such a paper would be Dunkel's own, and a revised version of the Hellstrom compromise text put forward at Brussels (and rejected by the EC even as a basis for further negotiations), in reality such a Dunkel text would probably be one secretly agreed to by the U.S. and EC top negotiators, but which they would not own up or put forward themselves.

But before doing so, Dunkel is pressing the chairmen of various negotiating clusters to press ahead and complete their work, narrowing down differences as much as they could, so that in the first week or two of November, he could bring out an overall revise (text of the draft Final Act that was before the Brussels meeting, embracing all areas of negotiations.

The Chairman of the TRIPs negotiating group, Lars Anell of Sweden, for example, in an annotated agenda of sorts for next week's meeting, has said that 16-22 October should be seen as the last opportunity for detailed work on the draft texts as a whole, focussing on outstanding issues.

The major part of this work, he has said, should be aimed at settling outstanding issues in the areas of standards and the provisions governing the timing of the impact of the obligations in the Agreement - transitionary provisions and Art. 73 as it relates to standards the so-called "pipe-line protection" clause.

U.S. and other ICs appear to be confident that with the last major hold-out in defence of national interests, India, having made what they consider to be a 180 degree turn under IMF-World Bank pressures in terms of economic policy, the difficulties in new areas including TRIPs could easily be wrapped up.

Some of the participants see that in this area, as in Agriculture, the only solution is for Dunkel to present a text, Which developing country governments could present to their public as the best they could do and which would have to be accepted unless one were ready to take the odium of reeking the negotiations.

Such a Dunkel text would include in TRIPs too what the majors agree upon and which Third World governments may privately acquiesce in but not publicly appear to be doing so, according to this view. This is seen by some as particularly important for countries where there is strong domestic opposition.

In India for example 250 Members of Parliament have given a memorandum against any compromises on patents issue. In some other countries too despite the Executive branches willingness to yield, their legislative branches may take a different view.

On the Art 73 issue in TRIPs, in the light of discussions at the previous meeting, Anell has suggested changes in the Brussels text, which would expand the "pipe-line protection".

Under this proposal, each Party (to the TRIPs agreement) shall apply the provisions of Part II (standards concerning the availability scope and use of intellectual property rights) to existing subject matter already under protection in that Party on the date of application, and to existing subject matter not under protection on that date but which meets or comes subsequently to meet the criteria for protection as laid down in this Agreement.

Shorn of legalese, this would mean, for example, that if in country A, food or pharmaceutical or chemical products have limited protection with a seven or ten year patent life, when A accepts the agreement, the term of patent would be automatically increased to 20 years for patents already in force. If only the process had been patented, it would automatically be extended to products too.

And if another part of the proposed agreement, still in square brackets, is accepted, then this would confer on the patent-holder the right of import monopoly in the country, and no obligation to work the patent. The patent-holder would no longer have to fear that he might lose his patent right or find the patent compulsorily licensed for non-working.

There are a number of alternative formulations, in the Anell text, to dilute or reduce the scope of the pipe-line protection, which had been formulated by the Third World delegations at the last meeting, but these are all in square brackets, while the pipe-line protection clause itself is shown without square brackets, suggesting agreement of sorts, even if the entire text is an informal one to which no one has been committed.

While some of these exceptions relate to rights being enjoyed by third parties now, even with some of the proposed compromises, the pipe-line protection sought would in some countries where there has been no protection or lesser protection could well result in a virtual expropriation of property of some in favour of others, all foreign TNCs and their greed in pursuit of profit maximisation and rentier incomes.

Other issues to be resolved, and which are expected to be pushed next week, relate to patenting of animal and plant varieties and biological processes, the nature of the exclusive rights to the patent-holder (including an import monopoly over the patented product) and what obligations could be imposed by a Party and whether it could extend to prohibiting of anti-competitive practices including restrictive licensing, etc., and the issue of compulsory licensing.

Another is whether in civil litigation over process patents, whether the Party to the agreement "may" or "shall" shift the burden of proof that a different process was being used on the defendant.

The issue of control of abusive or anti-competitive practices in contractual licenses involving intellectual property rights - which in domestic legislation and practice of industrial countries is used to curb the monopoly rights of IPR holders is also an issue to be resolved. The entire Uruguay Round TRIPs sceheme envisages global monopolies for rights holders, but at global level nothing to deal with the anti-competitive abuses of such monopolies. The provision in Art. 43 of the TRIPs draft is merely one for Parties specifying and regulating such matters in their national legislation, for "consultation" among Parties at request for provision of information, etc.