Nov 5, 1990

THIRD WORLD COUNTRIES DETAILS THEIR OBJECTIONS TO TRIPS TEXT.

GENEVA, NOVEMBER 1 (BY CHAKRAVARTHI RAGHAVAN)— Third World Countries have spelt out TRIPs their substantial objections to, and concerns over, two texts of draft agreements in the area of Trade-related Intellectual Property Rights (TRIPs) formulated by the Chairman of the negotiating group, Amb. Lars Anell of Sweden.

Peru, speaking on behalf of the Third World countries, put these views on record at the meeting of the TRIPs negotiating group on thursday and wanted these views to be reflected in the subsequent stages of negotiations.

However, it became clear that, despite the objections and concerns of the Third World countries, the Chairman would be forwarding the texts drawn up by him to the TNC chairman for "green room consultations", merely trying to reflect the views of the Third World in a covering note, thus ensuring that the Anell text would be the basis for further work.

The TRIPs group has been involved in what has been described as the final pre-Brussels phase of negotiations under which draft texts are to be readied by November 2.

Like other negotiating groups, the TRIPs negotiations too are way behind schedule. The discussions and consultations within the group over the last several weeks have been on the basis of drafts prepared by Anell, one for a full-fledged IPR agreement and another on trade in counterfeit goods.

The texts are expected to be taken up in the non-transparent "green room" consultations where chairman, Amb. Lars Anell of Sweden, hopes to get a mandate to further pursue the negotiations and consultations between now and Brussels.

This would once again load the scales against the Third World, observers who have been following the negotiations fear.

They fear that provided a way around the U.S.-EEC deadlock in agriculture is found, the whole process would be a charade and that through the Dunkel and Anell consultations and processes, "pre-cooked texts", fully reflecting the interests of the leading ICs, would be brought forward and forced down on the South as happened in the 1989 mid-term review.

This would be more so because of the "not being isolated" syndrome of negotiators - some of whom find that everytime they speak up for their country interests, Washington gets on to people at the highest levels in their capitals and complain about their "obstruction" and not being "helpful", and the capitals sending back vague advises to be "cooperative".

At the meeting of the TRIPs group on thursday, Julio Munoz of Peru made a statement on behalf of the Third World countries outlining their objections to the substantive contents of the paper.

Shorn of the usual diplomatic courtesies of thanks to the chairman for his efforts, the only point on which third world countries have agreed with the Chairman has been over the structure of the paper, where he has bowed to the demands of the Third World and formulated two separate agreements one on TRIPs and the other on trade in counterfeit goods.

The Third World statement objected to the inclusion of provisions for protection of "undisclosed information" or the so-called trade-secrets and said that this was not within the mandate, such information was not an IPR and treating it as such would undermine the disclosure and publication requirements which are the basis of the IPR system and philosophy underlying grant of IPRs.

The provisions for dispute settlement and institutional arrangements, Peru said, were closely linked and pertained to the international institutional implementation of the results of the negotiations. As they had affirmed in their proposals (W.71), the implementation should be in relevant international organisation, account being taken of the multidisciplinary and overall aspects of these issues. The draft text should not prejudge the final decision to be taken on these issues.

Instead of taking account of the special needs and problems of the Third World countries and providing them flexibility in view of their special developmental and technological needs, the text had a thrust towards harmonisation of the IPR systems in all essential aspects. Such uniformity was inappropriate for countries at different levels of economic and technological development.

"Should these attempts at harmonisation be maintained, we would find it difficult to assume such obligations", Munoz said. The proposals of the least developed countries for special treatment to them also merited serious consideration.

"We are also concerned", Munoz said, "that most of the emphasis in the text is upon the provision of rights for IPR owners and little account is taken of their obligations or of the underlying public policy objectives of national intellectual property systems, including developmental and technological objectives. More emphasis should be placed on the need for developing countries to have access to technology on equitable terms and conditions. In this respect, more positive commitments relating to the encouragement and promotion of technology transfer are called for".

Highlighting some of the provisions with which they had problems, the Peruvian delegate made clear this did not mean they accepted other provisions.

The provisions for setting "minimum" obligations, under nature and scope of the agreement, would "excessively constrain" the flexibility required by the Third World countries, and could not also be reconciled with other provisions of the text which included not only obligations but also discretionary power of States.

The provision to force signatories to comply with major IPR conventions was also contrary to international law under which conventions bound only those which adhered to them - the only exception being conventions codifying general rules of customary law which did not apply to IPR conventions.

Third World countries were also not convinced of the need to include the MFN principle in the text. This was alien to the IPR system and would be rendered meaningless by the growing list of exceptions written into the text.

While welcoming the inclusion of a general provision on "exhaustion" of rights, a basic principle of IPR systems, Peru said this principle could not be subject to exceptions or conditions that might weaken or invalidate its application.

Also, any exclusive rights of importation should only be in relation to infringing goods or left to the discretion of parties.

The provisions on copyright, Munoz said, were examples of "lack of balance" in the text. The proposed provisions on limitations and exemptions to the Berne convention should be deleted, and the provision in Art. 8 on Berne convention should explicitly clarify that the rights of authors were subject to the limitations and exemptions in the Berne and Rome conventions.

It was not appropriate to protect computer programmes as "literary works" under copyright.

The provisions for "rental rights" should also be deleted as such rights were not recognised in any existing intellectual property convention and would pose problems of protection and implementation, especially in Third World countries.

Trade marks rights should not be extended to elements characteristic of designs - "shape of goods and combination of colours" nor was there need for double protection.

No limitations on the discretion of registration authorities in this area nor any provisions adding to or departing from the Paris convention on "well-known" trade marks were acceptable. The proposals for requirements of use and other requirements for a trademark was out of place in a TRIPs agreement and this was a matter that had to be left to national laws.

While Third World countries had no problems with the proposals for protecting geographical indications and against uses that might deceive or confuse the public, there was no need for additional protection envisaged or for discriminating between wine and spirits on one hand and other products on the other.

They were also opposed to the favourable treatment to a particular category of designs (the draft provides for this in respect of costs, etc., for those with "a short commercial life cycle") nor to any "exclusive rights of importation".

As for Patents, it was vitally important that Third World countries have the possibility of exclusion of certain products and processes from patentability on grounds of public interest, health or nutrition.

Plant variety rights were a distinct sui generis category of rights regulated by a separate convention and could not be dealt with under patents.

There should be no provision for extending the "process patent" rights to products produced through the process.

The draft should clearly specify the obligations of patent owners: the obligation to work the patented invention in the country granting the patent right. Such working was an essential element of the patent system and part of the balance between the interests of the patent owner and that of the country undertaking to protect the invention.

The draft merely provides an obligation for "satisfaction of reasonable requirements of the public" and to refrain from abusive or anti-competitive practices in regard to licensing contracts or contracts assigning patents.

The key article of the text, on non-voluntary licenses and other use without authorisation, Munoz complained, undermined the very basis on which compulsory licences were usually granted - for prevention of abuses resulting from exercise of exclusive rights and in public interest.

The Paris convention specifically mentioned the failure to work as an abuse. The concept of abuse, and of failure to work being such an abuse should be maintained. If no agreement was possible on the listing of grounds for grant of compulsory licence, no grounds should be listed at all.

As for term of patent protection, Munoz reaffirmed the position of the Third World countries that this should be left to the discretion of countries. There was no way of scientifically or objectively demonstrating the "optimum duration" of protection.

The reversal of the burden of proof, casting onus on a defendant to prove that a product alleged to be infringing a process patent was being produced by a different process from the patented one, was contrary to principles of equity and natural justice.

The Peruvian delegate also rejected as unacceptable the inclusion of a provision for "transitional protection" (obliging parties to protect rights even before they become parties to the agreement) and other such retroactive provisions. There should be a specific provision prohibiting retroactivity.

There was also no need for any additions to the provisions on layout designs of integrated circuits. After long years of discussions and consideration, the Washington treaty had just been concluded and no process to amend it could be started "even before the ink is barely dry upon it".

The provisions for control of abusive and anti-competitive practices were an extremely important one for achieving a balanced TRIPs agreement. But the consultation machinery provided for it under the agreement was "too weak" and should be strengthened to attain some credibility.

The enforcement provisions were too detailed and had made no allowance for the limitations of administrative and financial capabilities of countries. The lack of such a provision would be inequitable for Third World countries particularly. Enforcement provisions should not also result in creating separate legal and judicial structures and practices applicable only to IPR enforcement.

Rejecting the proposals for "transitional arrangements" and time-derogations for Third World countries, Munoz said that economic and technological development was not "a time-bound phenomenon", but a qualitative process that could not correspond to a specified number of years.

"The leisurely way in which the intellectual property systems of countries which are now technologically advanced were gradually modified as and when they developed illustrate this point. Rather than transitional provisions for a limited period, we see it as more important to have adequate provisions allowing for special economic and technological needs of developing countries, thus affording them to build up their technological capabilities without the external constrains that would be imposed by uniform standards of IPR protection".