Sep 21, 1981

US-EEC MOVES FOR COUNTERFEIT CODE RECEIVED VERY COOLY BY THIRD WORLD, AND OTHER INDUSTRIALISED COUNTRIES

Geneva Sep 21 (IPS/by Chakravarthi Raghavan) -- The USA and EEC got a very cool reception if not virtual rebuff on their moves in GATT to negotiate and push through a so-called code to deal with "counterfeit" goods in international trade, according to GATT sources.

By `counterfeit´ goods, these countries mean goods that are the same or similar to those, produced in violation of patent or trade mark rights, but also covering a wider range including trade names etc.

If the US and EEC have their way, national governments would have to undertake measures to end what they consider "counterfeit" production of goods and/or their imports. The main purpose of these two major trading blocs would appear to be aimed at a wide variety of clothing, cosmetic and perfumery, and other items where brand names are counterfeited by using the same or similar names.

At the time of the Tokyo Round negotiations in GATT the US and EEC came to an agreement with each other on such a code and sought to put it on the table as part of the Tokyo Round

Multilateral Trade Negotiation (MTN) accords, asking others to sign and join. This was not accepted, with the then DirectorGeneral of GATT, Mr Olivier Long agreeing with the object(ion) that a bilaterally negotiated arrangement could not be made into multilateral code for signature.

The US and EEC have since then been trying to pursue the idea. They are already attempting to do so within the World Intellectual Property Organisation (WIPO) as a consumer protection measure and are also trying to revive within GATT enactment of a code.

The two would appear to have tried to get the GATT secretariat itself to convene a meeting on this. But when the secretariat sensed serious objections from the Third World on this, an informal meeting was convened as at the instance of US and EEC in the GATT premises on Friday last week.

It may be noted that the MTNs under Tokyo Round, concluded in 1979, has left a number of-issues unresolved, and these are on the GATT work programmes.

These issues relate mainly to trade issues of concern to the Third World countries and include: the issue of a safeguards' codes, trade liberalisation in tropical products, agricultural products and their processed goods (involving tariff cuts, removal of non-tariff barriers and of tariff escalation in processed goods), removal of quantitative restrictions and other non-tariff barriers.

The industrialised countries and specially the USA and EEC have been generally procrastinating on these post-Tokyo Round issues, causing both concern and resentment among the Third World countries.

At the informal Friday meeting, when the US and EEC brought up the counterfeit code, and tabled a draft of their own, it would appear that speaker after speaker from the Third World countries strongly criticised the move and the priority sought to be assigned to it. The move was also reportedly opposed by some of the other industrialised countries, while others gave it only a qualified support.

Some of the Third World countries, members of the WIPO and the Paris Convention (dealing with patents and trade marks), noted that the issues raised related to and was within the competence of WIPO and not GATT.

When the US and EEC reportedly sought to argue that there was an area of complementarity and GATT should, through a code, deal with this, several Third World countries would appear to have pointed out that when it suited their interests the industrialized countries took the position of "complementarity" but when Third World countries brought up issues, they sought to prevent consideration in UN forums of their choice on the ground of 'duplication!'.

Other Third World countries also complained that the issue was one of low priority in international trade and GATT's work programme. And they could not countenance efforts to deal with such issues, while issues of concern to them were being put on the shelf.

Among the industrialised countries Australia, and the Nordics too were negative to the idea. While Canada and Switzerland gave very qualified support. The Canadians reportedly noted that the move would vest vast powers in customs administrators and unequal burdens, while the Swiss underlined the usefulness of a code only if it had the widest participation (which it was lacking since the Third World countries were very cool).

As one participant put it, at the end it was clear that the move had the support only of the USA and EEC, opposition from the Third World countries, and lukewarm to qualified support from other industrialised countries.