Intellectual Property Rights and Development October 2007 note INTELLECTUAL property (IP) refers to creations of the mind: inventions; literary and artistic works; symbols, names and images; and designs used in commerce. Intellectual property rights (IPRs), exclusive rights or mo- PUBLISHED BY nopolies to the creators (inventors) of IP in the forms of patents, copy- South Asia Watch on Trade, rights, trademarks etc., have now become an integral part of the market Economics & Environment (SAWTEE) economy. Most economies today, including those in South Asia, have

editors’ laws that provide protection to IP. However, with the rapid growth in REGIONAL ADVISORY BOARD international trade, policies related to IPRs are no more confined to the Bangladesh national sphere but have also become an important element of interna- Dr Debapriya Bhattacharya tional economic governance. India The inclusion of the Agreement on Trade Related Aspects of Intellec- Dr Veena Jha tual Property Rights (TRIPS) in the World Trade Organization (WTO), Nepal despite vehement opposition by developing Members, means that all WTO Dr Posh Raj Pandey Members are obliged to provide a minimum protection to IP. Though stron- Pakistan ger IPR regimes are said to encourage innovation and benefit the econo- Dr Abid Qaiyum Suleri mies as a whole through enhanced investment and technology transfer, Sri Lanka they do not merely create restrictions on the use of new products and Dr Saman Kelegama processes but also pose various challenges to the developing countries, including those in South Asia. EDITOR-IN-CHIEF Most developing countries lack the institutional, financial and hu- Navin Dahal man capacity to implement such regimes. Stronger protection and longer periods of monopolies to right holders, especially those on medicines, are likely to make healthcare expensive, and in most cases, out of the reach of EDITOR the poor in these countries. Similarly, the need to provide protection to Kamalesh Adhikari new plant varieties may affect the biodiversity and agricultural systems in developing countries. Stronger IPR regimes espoused by TRIPS pose a EDITORIAL ASSISTANCE threat of misappropriation of biological and genetic resources and tradi- Paras Kharel tional knowledge, jeopardising the rights of their local, indigenous and Shivendra Thapa farming communities. Furthermore, if proper safety nets are not intro- duced, these impacts are likely to aggravate gender disparities as women DESIGN are more vulnerable to negative consequences in the health and agricul- Indra Shrestha tural sectors. Given that many developing countries are already Members of the ILLUSTRATION & COVER WTO and need to provide a minimum IP protection, it is important that Abin Shrestha they utilise the flexibilities in the WTO system to use IPRs as a tool to achieve their development objectives. The recent examples of some devel- oping countries indicate that this is possible. Thailand and Rwanda have PRINTED AT used the flexibilities in TRIPS to provide cheaper HIV/AIDS drugs to Jagadamba Press their citizens. Similarly, India has enacted the Plant Variety Protection Kathmandu and Farmers’ Rights Act, which ensures that those who commercialise the knowledge or plant varieties that have been preserved and developed by farmers or local communities share the benefits with the latter. The developing countries can also use “geographical indications”, a form of IPR recognised by TRIPS, to promote their “indigenous products” in the international market. While utilising the flexibilities in the WTO system, developing coun- P.O. Box: 19366 254 Lamtangeen Marg tries need to be cautious that they do not bind themselves to implement- Baluwatar, Kathmandu, Nepal ing stricter IPR regimes than those required by the TRIPS Agreement. Tel: 977-1-4415824/4444438 Some developed countries have been eager to ratchet up IPR standards Fax: 977-1-4444570 through bilateral and regional trade agreements, which have “TRIPS plus” E-mail: [email protected] clauses. Web: www.sawtee.org It is important to ensure that developed countries do not restrict the PUBLISHED WITH THE SUPPORT FROM “policy space” of developing countries but assist them in realising their development goals. In this process, developed countries need to show flexibilities and provide assistance to developing countries for enabling them to address the challenges of and benefit from IPRs. n Contents Trade Insight • V ol. 3, No. 2, 2007

WIPO DISCUSSION 4

TRADE WINDS 5

PATENT AND TK 8

Patent Pathology and Protection of T raditional K nowledge

GEOGRAPHICAL INDICATIONS 11

Promoting Trade and Pro-Poor Growth through Geographical and Indications Development Concerns DOHA ROUND ISSUES 19 Making Use of IPR Decisions of the Doha Work Programme: in South Asia The Case of India COVER FEATURE 14 PUBLIC HEALTH 27

TRIPS Flexibilities and Intellectual Property Rights and Access to Medicine Gender IPR DISPUTE 33 Protection and Enforcement of Intellectual Property Rights

Are there any options to LEGAL ISSUES 36 reduce gender disparities, likely to be generated by IPR The Nexus between Indian Laws and International IPR Conventions regimes? ACTIVITIES 38

GENDER ISSUES 23 SAWTEE NETWORK BANGLADESH 1. Associates for Development Initiatives Protecting Farmers’ Rights in the (ADI), Dhaka 2. Bangladesh Environmental Lawyers’ Association (BELA), Dhaka Global IPR Regime INDIA 1. Citizen consumer and civic Action Group (CAG), Chennai 2. Consumer Unity & Trust Society (CUTS), Jaipur Given the implications of IPRs 3. Development Research and Action Group (DRAG), New Delhi on farmers’ livelihood 4. Federation of Consumer Organisation of Tamilnadu & Pondichery (FEDCOT), and biodiversity, what Thanjavur

approaches need to be adopted NEPAL 1. Society for Legal and Environmental to realise farmers’ rights ? Analysis and Development Research (LEADERS), Kathmandu 2. Forum for Protection of Public Interest FARMERS’ RIGHTS 30 (Pro Public), Kathmandu PAKISTA N 1. Journalists for Democracy and Human Rights (JDHR), Islamabad 2. Sustainable Development Policy Institute The views expressed in the articles published in Trade Insight are those of (SDPI), Islamabad the authors and do not necessarily reflect the official position of SAWTEE SRI LANKA or its member institutions. 1. Law & Society Trust (LST), Colombo WIPO discussion

Member States adopt Development Agenda for WIPO

MEMBER States of the World In- and will discuss intellectual prop- tellectual Property Organisation erty (IP) and development-related (WIPO) made a decision on 28 issues as agreed by the Committee September 2007 to adopt a De- and decided by the General As- velopment Agenda consist- sembly. ing of a series of recommen- The Committee will be dations to enhance the “devel- open to all accredited inter - opment dimension” of the or- governmental and non- ganisation’s activities. The governmental organisa- recommendations include a tions and is expected to set of 45 agreed proposals hold its first meeting in the covering six clusters of activities, first half of 2008. The Com- including: mittee will report and may make • Technical assistance and ca- recommendations annually to the pacity b uilding; General Assembly. • Norm-setting, flexibilities, Following a process of informal p ublic p olicy and p ublic Member States agreed to estab- consultations prior to the General knowledge; lish a Committee on Development Assembly, in the context of the Pro- • Technology transfer, informa- and Intellectual Property to devel- visional Committee on a WIPO De- tion and communication tech- op a work programme for the imple- velopment Agenda, Member States nology and access to k nowl- mentation of the adopted had identified 19 proposals for im- edge; recommendations. This Committee mediate implementation. With the • Assessments, evaluation and will monitor, assess, discuss and re- approval of the General Assembly, impact studies; and port on the implementation of all rec- these proposals will now be imple- • Institutional m atters includ- ommendations adopted by coordi- mented immediately by WIPO ing m andate and governance. nating with relevant WIPO bodies (www.wipo.int, accessed 03.10.07. ) n Work on TK, GR and Folklore

MEMBER States of the World In- velopment of an international in- tellectual Property Organisation strument or instruments in this (WIPO) have agreed to continue field without prejudice to the accelerated work on intellectual work pursued in other fora. property (IP) and traditional In the General Assembly, del- knowledge (TK), genetic resourc- egates urged the Committee to es (GR) and folklore/traditional work towards a substantive con- cultural expressions (TCEs), with clusion in the coming two a focus on the international years. Many delegates also dimension. The WIPO General called for a binding internation- Assembly has extended the man- al legal instrument as the only date of the Inter-governmental eral Assembly’s 2005 directions to fully effective response to the glo- Committee on Intellectual Prop- the IGC to accelerate its work, and to bal phenomenon of misappropri- erty and Genetic Resources, Tra- focus, in particular, on the interna- ation and misuse of TK and ditional Knowledge and Folklore tional dimension of IP, and TK, GR TCEs for industrial and commer- (IGC) for two years. and TCEs. The mandate excludes no cial use ( www.wipo.int, accessed This decision renews the Gen- outcome, including the possible de- 03.10.07 ). n

4 • Trade Insight • V ol.3, No.2, 2007 trade winds

G12: A new parallel negotiating The US agrees to cap configuration domestic support THE US on 19 September agreed A major development that marked progress in the to cap trade-dis- trade negotiations in September, and Doha Round. While torting domestic in which the United States (US) some stakeholders support to agricul- played a leading role, was the emer- hope that the G12 ture in the range of gence of a new parallel negotiating process will pro- US$ 13-16.4 bil- configuration, originally known as duce a break- lion as proposed the “group of eight” (G8). through towards an by the Chair of The group, which includes the agreement on the multilateral agri- US, the European Union (EU), Bra- Doha Development cultural negotia- zil, India, Australia, Japan, Argen- Agenda, a number of Members are tions under the WTO, which re- tina and Canada, started meeting frustrated that the multilateral process sumed on 3 September 2007 after on 6 September, at the invitation of is again being sidelined. the summer break. The range is be- the US delegation. At the insistence Given the expiry of the Trade Pro- low the previous official US offer of India, other four countries – Chi- motion Authority, few had expected of US$ 22 billion. The US move, na, South Africa, Jamaica and In- US trade officials to demonstrate the however, did come with strings at- donesia – were also invited to join level of engagement they showed by tached. In exchange, other Mem- the G8 on 18 September and became convening the first meeting of the G8 bers are expected to accept the rest new members of what is now called and taking a bold step on proposed of the parameters set out in the “the group of twelve” (G12). agriculture subsidies cuts. Although texts on agriculture and non-ag- Since then, the group has held in- the US offer (See the news on US do- ricultural market access (NAMA). tensive negotiating sessions, occa- mestic support) is important, many The latter appears particularly sionally inviting other countries to World Trade Organization (WTO) unlikely, given the stiff resistance join the discussions on specific is- Members are questioning the ability the NAMA draft faced from a sec- sues. From 14 September onwards, of the current US Administration to tion of developing Members when genuine negotiations among group carry out trade deals that lack Con- it was released in July. (Trade- M embers were expected to trigger gressional support . Watch, 04.10.07) . n IPRs and Access to Medicines Case of Rwanda Case of Thailand Canadian patent authorities recently issued a com- Thailand is considering issuing compulsory licenc- pulsory licence, authorising the generic production of es on three cancer medicines, while another key can- a patented HIV/AIDS drug for export to Rwanda. The cer drug will not be targeted after the patent holder Canadian Intellectual Property Office cleared phar- agreed to give free access to patients under Thailand’s maceutical company, Apotex to manufacture and de- medical healthcare scheme. The drugs that could be liver 260,000 packs of Apo-Triavir to Rwandan health affected include Imanitib and Letrozole from Novar- authorities. This will be sufficient to treat 21,000 AIDS tis; Docetaxel from Sanofi-Aventis; and Erlotinib from patients for a year. The authorisation follows Rwan- Genentech. The medicines are used to treat various da’s July notification to the World Trade Organiza- kinds of cancer, ranging from tumours to breast and tion (WTO) that it wanted to import that quantity of lung cancer. Thailand’s Minister for Public Health, medicine from Canada. Nearly four years after the 30 Dr. Mongkol Na Songkhla affirmed that the govern- August Decision waiver, Rwanda became the first ment will carefully and thoroughly consider its move country to try to use the mechanism when it notified to effectively “break the patents” of the cancer medi- the “Council for TRIPS” of its intention to do so in cations, and he stressed that the move was necessary July. Similarly, Canada has also become the first for the government to ensure broader access to neces- country to respond to the 30 August Decision, clear- sary medicines. Thailand stands firm that it will use ing the way for the export of generic versions of es- compulsory licencing only as a last resort and will sential medicines through initial legislation in 2004, do so in strict compliance with the provisions of the and then through the Canadian Access to Medicine Agreement on Trade Related Aspects of Intellectual Regime in May 2005 (Bridges Weekly Trade News Di- Property Rights (TRIPS) ( www.bangkokpost.net, access- gest, 26.09.07 ). n ed 25.08.07 ). n

Vol.3, No.2, 2007 • Trade Insight • 5 trade winds SAARC Development Fund Pakistan-EFTA meet concludes Charter finalised THE European Free Trade Association (EFTA) – which com- prises Switzerland, THE financial experts of other non-infrastruc- Norway, Iceland and eight Member States of tural commercial Liechtenstein – and the South Asian Associ- projects. Pakistani trade officials ation for Regional The meeting also met in Geneva on 3 Cooperation discussed the October 2007 to investi- (SAARC) have issue of capital gate how trade and finalised the charter structure, opera- investment relations and other issues in tions, organisation can be expanded. relation to the SAARC and management, During this meeting, Development Fund decisionmaking, critical the delegates discussed (SDF). by-laws and charter, issues concerning The fund was and regulations of the current trade regimes of created as per the SDF. The experts EFTA Members and decision of the SAARC came to an agreement Pakistan ; trade and Summit held in 2005 as on the modalities of the projects; investment flows ; an umbrella organisation • SDF operations through Infrastructure existing trade agree- for all SAARC develop- two tiers, which would Window, through ments; and ongoing ment funding. It compris- include a governing body which funds will be negotiations. It con- es three windows: and an executive body mobilised from cluded with an agree- headed by a chief execu- within and beyond ment to continue • Social Window, with tive officer entrusted with the region to finance deliberations on ways an initial amount of looking after the day-to- infrastructure and means of expand- US$ 300 million to day activities with a development ing trade and invest- fund, among others, permanent secretariat projects; and ment relations in early poverty alleviation • (The Himalayan Times, Economic Window, 2008. These delibera- programmes and 02.10.07 ). n which will fund tions will address all available trade policy instruments with a view BIMSTEC meeting reaches consensus on to improving framework conditions and market access for goods, downsizing negative list services and invest- ment. th The 15 meeting of the – reached a consensus will reduce their tariffs In 2006, Pakistan- Trade Negotiating on downsizing the in a span of 10 years EFTA trade stood at Committee (TNC) for the negative list of products while the developing approximately US$ 500 Bay of Bengal Initiative from 25 percent of the Members will do the million. Pakistan’s for Multi-Sectoral total 5,226 tariff lines to same within five years. main exports to EFTA Technical and Econom- 15 percent. They also Around 40 delegates include clothing, ic Cooperation (BIM- agreed on 35 percent from Member countries textiles, rice, leather STEC) Free Trade value addition require- participated in the products, sports goods Agreement was held ment of products for the meeting. The next TNC and surgical instru- during 24-26 September developing country meeting is scheduled to ments. Main imports are 2007 in Dhaka, Bang- Members and 30 percent be held in New Delhi, machinery, chemicals, ladesh. for the least developed India during 12-15 precious stones, At the meeting, trade country (LDC) Members. November 2007, which electronic equipments, negotiators from Members also agreed is expected to finalise the pharmaceutical prod- Member countries – on the modalities for tariff issues agreed upon at ucts, iron and steel, and Bangladesh, Bhutan, cuts, namely Linear the Dhaka meeting plastics. ( www.wto- India, Myanmar, Nepal, Equal Tariff Cut, by (www.allheadlinenews.com, pakistan.org, accessed Sri Lanka and Thailand which the LDC Members accessed 05.10.07 ). n 16.10.07 ). n

6 • Trade Insight • V ol.3, No.2, 2007 trade winds

accounts for 54 percent of its gross Tonga becomes domestic product (GDP) and its CONCERNS st major industries include agricul- the 151 Member ture (41 percent of GDP) and fisheries (20 percent of exports). Its over EU’s free of the WTO main trading partners are Japan, trade agreements the United States (US), New THE Kingdom of Zealand and Australia. CONCERN is growing in both the Tonga became the 151 st Tonga applied for European Union (EU) and Member of the World accession to the WTO in developing countries about Trade Organization June 1995 but negotia- whether a series of free trade (WTO) after its acces- tions effectively started agreements slated for signature sion package was only in April 2001. The later this year will contain overly ratified on 27 July 2007. Besides terms of Membership, which stringent rules on intellectual being the latest Member, Tonga is include the Report of the Working property (IP). also the fourth Pacific Island State Party for the Accession of Tonga, The European Commission to join the WTO after Fiji, Papua the Protocol of Accession, and the has proposed that the Economic New Guinea and the Solomon Schedules of Tonga’s commit- Partnership Agreements (EPAs) it Islands. ments on market access for goods wishes to conclude with 76 Tonga is one of the world’s and services, were adopted by the African, Caribbean and Pacific smallest economies with a popula- Working Party on 1 Decem- (ACP) countries by 31 December tion of approximately 116,000 and ber 2005 ( www.wto.org, accessed should commit all parties to a an area of 748 sq. km. Trade 03.10.07 ). n robust enforcement of IP. The Commission’s thinking behind its efforts to have IP provisions in ‘Aid for Trade’ Regional Review trade deals that are concluded with countries outside the EU was THE World Trade outlined in a “market access Organization’s strategy” published in April. It (WTO) “aid for identified “poor protection” of IP trade” initiative rights as one of the principal held its final barriers to trade encountered by “regional review” European firms trying to do in Tanzania business abroad. during 1-2 Anti-poverty activists and October 2007, in ACP diplomats have expressed an attempt to mobilise support for Trade Development Facility, which misgivings about the Commis- giving African countries the since 2002 has helped developing sion’s approach, arguing that it financial and technical assistance nations adjust to food safety could be used to open poor they require to boost their capacity standards. countries to Western firms to the to use international trade as a tool Further, as an illustration of detriment of local industries. EU for economic development, job how “aid for trade” investments negotiators have recommended creation and poverty reduction. can yield major rewards, WTO that ACP countries should be The conference covered issues Director General, Pascal Lamy required to comply with the terms ranging from rich country farm referred to Kenya’s flower export of the Copyright Treaty and the subsidies to agricultural safety sector. While pesticide residues Performers and Phonograms norms, investment, competitiveness had once kept Kenyan flowers out Treaty of the World Intellectual and the relatively high cost of of the markets of the United States Property Organisation (WIPO). doing business in Africa. (US) and the European Union (EU), Similarly, the EU has recom- Other discussions aimed to a 5 million Euro grant from the EU mended that far-reaching IP rules garner aid and technical support to helped the Kenyan flower industry should apply to databases. This assist developing country exporters phase out the pesticides and could mean that data generated comply with food safety standards, emerge as one of the world’s by governments such as geo- which would help them increase leading exporters. The sector graphical information of potential exports while minimising the risk earned over US$ 700 million last use in industrial development to consumers. The WTO has asked year and employs two million would no longer be freely avail- rich countries for US$ 25 million workers, four-fifths of them on able in libraries and educational over the next five years in order to small-scale farms ( Bridges Weekly facilities ( Intellectual Property fund the WTO’s Standards and Trade News Digest, 05.10.07 ). n Watch, 20.08.07 ). n

Vol.3, No.2, 2007 • Trade Insight • 7 patent and traditional knowledge PatentRegional Pathology Cooperation in South Asia and Protection of Traditional Knowledge

Codifying and registering TK and GR nationally offer only the slightest protection against the expropriation of TK and GR wealth; the incorporation of disclosure requirement in TRIPS is a first step towards “robust and self-interested” protection.

n Steve Suppan

t the June meeting of the World A Trade Organization’s (WTO) “Council for TRIPS”, the United States (US), Japan, the European Union (EU) and Switzerland, hold- ers of the great majority 1 of the world’s patents, copyrights and trademarks, once again sought to make intellectual property right (IPR) enforcement a standing agenda item. And once again, they were rebuffed by a group of developing countries, including Brazil, China, India and Thailand, which argued that the Council’s decisions about how IPRs to promote. 2 In a WIPO open forum logical assumption of greater priva- are enforced would undermine WTO in March 2006 on the proposed Sub- tisation of knowledge resulting in Member’s discretion in enforcement. stantive Patent Law Treaty for en- greater innovation is starting to ebb Lost in the heated debate about en- forcement of a globally harmonised in patent and trademark offices and forcement sovereignty was the ques- patent system, the prevalence of in legal tribunals. In separate rulings tion about the validity of the IPRs to patent pathology was invoked as from March to July, the US Patent and be enforced. one reason not to go forward with Trademark Office (PTO) rejected four If the global IPR enforcement re- the negotiations. Monsanto patent claims on the gime that patent-rich countries are In this article, some legal and reg- grounds that Monsanto had misrep- seeking through bilateral investment ulatory proposals for mitigating the resented the degree of innovation in treaties (BITs) and negotiations at the patent pathology affecting the sus- its RoundUp Ready herbicide-resis- World Intellectual Property Organi- tainable use of GR, particularly tant seeds to the point where the sation (WIPO) is to have any legiti- seeds, are surveyed. An analysis of patent claims were no longer valid. 3 macy, IPRs must be valid. The valid- inter-governmental negotiations to On 30 June, a US Supreme Court rul- ity of patents on genetic resources protect and sustainably use tradi- ing, i.e., KRS International Inc. v. Tele- (GR) and, more generally, the validi- tional knowledge (TK) and GR, par- flex Inc. et al., declared that patent ty of privatising the public domain ticularly those used in agriculture, applicants would have to better doc- from which patented innovations are to suggest how TK and GR use rules ument that their products met the derived, are under tough examina- might aid development, while pre- standard of “non-obviousness” by tion by legal scholars. Adam Jaffe venting or at least reducing the inci- which a patent examiner or similar- and Josh Lerner have characterised dence of patent pathology, has also ly skilled person could determine the rise of a legal culture granting or been presented. whether a product was truly inno- extending patents on dubious or vative and hence, meriting a public even fraudulent grounds as produc- Fighting patent pathology: grant of legal privilege. In May, the ing a “patent pathology” that is Some legal cases EU Patent Office revoked a broad threatening the general capacity for During the past few months, there Monsanto patent claim covering all innovation that IPRs are supposed have been indications that the ideo- soy seeds and plants. 4

8 • Trade Insight • V ol.3, No.2, 2007 patent and traditional knowledge

Monsanto dismissed the impor- of farmers to save, exchange, cross- TRIPS objectives of improving patent tance of the PTO rulings as regulato- breed, and replant their seeds, even quality by providing a more complete ry misunderstandings and an- if contaminated by patented variet- record of the process of claimed in- nounced that it would appeal the ies, take place in the context of inter- novation (TRIPS Article 27.1). rulings. Monsanto noted that patent governmental negotiations over how Amendment proponents also want rejections are not patent revocations intellectual property (IP), TK and GR TRIPS to support the access and ben- and that it had so many patents on a should be protected and enforced. efit sharing (ABS) provisions of the product, not even a revocation would Decisions over patent validity and Convention on Biological Diversity adversely affect its sales. But for US infringement are primarily the mat- (CBD) as well as to implement TRIPS farmers convicted of violating Mon- ters of national law. However, inter- Article 8 on preventing abuse of santo’s patents on seeds, the PTO governmental discussions and nego- patent system such as biopiracy, and rulings and Supreme Court decision tiations not only provide a legitimis- promoting the public interest. comprise a first step towards possi- ing framework for national IPR and Developed countries, save Nor- ble legal vindication and financial TK policy but also provide a forum way, have opposed the proposed compensation for legal expenses and for exchange of ideas on how to make amendment. The US has argued that lost business. ABS is best served by bilateral bio- An attorney defending the farm- prospecting contracts such as the one ers said of the PTO ruling, “Logical- The US has argued that between Merck, Inc. and Costa Rica, ly, I would think the judgement “access and benefit in which the company may seek to [against his clients] is void if the patent products and earn royalties patent is void.” However, because sharing” is best served developed from any and all of 10,000 many patents often apply to a prod- by bilateral bio- GR samples. In exchange, Costa Rica uct, unless a farmer had been con- received US$ 1 million and bio- victed of violating the patent that has pr ospecting contr acts, prospection equipment. Norway’s been declared invalid, it may still be such as one between proposed amendment to apply the difficult to get an IPR violation con- disclosure requirement to future viction annulled. Merck, Inc. and Costa patent applications but not to revoke According to “Monsanto vs. U.S. Rica, in which the patents already granted for disclo- Farmers 5,” in 2004, Monsanto had a sure failures has been “welcomed” staff of 75 lawyers with a budget of company may seek to by most developing countries. Fu- US$ 10 million dedicated solely to ture patents would not be granted prosecuting alleged IPR violations. patent products and without TK and GR documentation, Based on Monsanto’s claim of un- earn royalties developed according to Norway, but existing dertaking 500 US violation investi- patents erroneously granted would gations a year, probably thousands from any and all of be disciplined outside the patent of US farmers have settled charges of 10,000 GR samples system. TRIPS negotiations remain IPR violation out of court by paying stymied, along with the rest of the millions of dollars and agreeing to Doha Round.8 keep both the accusations and set- the patent system serve more inter- In WIPO, discussions on wheth- tlement terms out of the public record. ests than those of the patent holders. er to negotiate binding norms on pro- Better to settle, farmers calculate, tection of TK and GR have been op- than trying to defend themselves in Fighting patent pathology: posed by some developed countries the courts of Monsanto’s headquar- Multilateral negotiations on TK as a threat to TRIPS. Nevertheless, ters in St. Louis, Missouri. But for the and GR discussions have not halted and sev- dozens of farmers who decided to On 5 June, the African Group of 41 eral developing countries have un- fight Monsanto in court, such as the WTO Members announced its sup- dertaken to document and codify renowned case of Monsanto Cana- port for a developing country initia- their TK and related GR, both for li- da Inc. v. Schmeiser, the PTO rulings tive to amend Article 29 of the TRIPS censing the use of TK and GR in pat- and US Supreme Court decision are Agreement. The announcement was ented products in ABS contracts and harbingers of long sought relief. 6 particularly significant because it for assisting in implementing a dis- In the ruling against Schmeiser, now appears that the African closure amendment to TRIPS, if it is the Supreme Court of Canada arro- Group regards the proposed amend- one day agreed. There are several dif- gated to itself the powers of a WTO ment as at least complementary to ficult issues that require practical so- dispute settlement panel, ruling that its long-standing “No Patents on lutions before effective TK and GR the scope of Monsanto’s patent Life” position. norms can be negotiated. Some of claims was consistent with the Agree- The proposed amendment re- these issues have been outlined in a ment on Trade Related Aspects of quires that WTO Members annually WIPO Secretariat Paper prepared for Intellectual Property Rights (TRIPS). 7 report disclosures of TK and GR used the 3-12 July meeting of the Inter-gov- These legal battles over the rights in products in order to support the ernmental Committee on IP, GR and

Vol.3, No.2, 2007 • Trade Insight • 9 patent and traditional knowledge

TK and folklore. 9 a methodology, ne- history of science and TK can sug- Two other vital There is no agreed gotiating an ABS li- gest. Codifying and registering TK/ issues (there are still cence to pay for TK GR nationally offer only the slight- more) that have not methodolo gy for and GR in a patent- est protection against the expropria- been discussed in estimating the ed product will tion of TK/GR wealth. Adopting the the Secretariat Pa- have little econom- disclosure amendment in TRIPS is a per are: developing economic value of ic basis and it is first step towards “robust and self- an enforcement genetic resources likely to result in interested” protection. mechanism for TK arbitrary and un- According to IP scholar James and GR violations; and traditional fair agreements. In Boyle, the huge expansion in the and developing a 1998, FAO estimat- breadth and duration of IP claims methodology for es- knowledge used in ed that a one per- during the past three decades has timating the eco- patent/ cent royalty on TK undermined the balance between the nomic value of TK and GR used in public domain foundation of knowl- and GR in commer- commercialised patented agricul- edge and the privately held innova- cial products, par- products tural products tions derived from that foundation. 11 ticularly patented would yield about Protecting TK and GR will be part of ones. US$ 150 million the reassertion of the primacy of the Norms to protect TK and GR from annually for GR providing countries. public domain foundation of inno- misappropriation in the patent sys- The annual royalty yield for GR-de- vation. More broadly, as Peter Bar- tem and to foster its sustainable use rived pharmaceuticals and indus- nes has written in Capitalism 2.0, pro- are only as good as the norms’ en- trial products would be consider- tecting global public goods will re- forcement mechanism. Professor Pe- ably greater in aggregate. But such quire new legal structures and polit- ter Drahos has strongly advised aggregate estimates would be of lit- ical constituencies to recuperate the against negotiating binding norms tle help in negotiating a product public domain of the natural re- in advance of constructing an “en- specific contract. sources and knowledge we have in forcement pyramid” whose founda- common. n tional layer would be the indigenous Fighting patent pathology: and local groups, the custodians of Building political will to change The author is associated with the in situ conservation of biodiver- What might motivate patent-rich Institute for Agricultur e and T rade sity. To build an effective enforcement countries to require their companies Policy (IATP), USA. mechanism, it would be necessary to to pay royalties, when they can ex- establish a good working relation be- propriate TK and GR from develop- tween indigenous governance ing countries at little, if any, cost? groups and national governments, Why not, instead, continue to inten- Notes particularly where the custodians of sify efforts to privatise the public do- TK and GR extended across nation- main, including TK and GR, when- 1 As of 2005, about 5.6 million patents al bodies. At the global level of the ever and wherever possible? Why are in force worldwide, with the US enforcement pyramid, Drahos pro- not deny the prevalence of patent patent office alone having 900,000 poses a Global Bio-Collecting Soci- pathology and continue business as p atent s pending. www.wipo.int 2 ety under the aegis of WIPO, CBD usual? Adam B. Jaffe and Josh Lerner, Innovation and Its Discontents and the United Nations Food and The innovation argument (Princeton: Princeton University Press, Agriculture Organisation (FAO). against patent pathology may seem 2004). These levels of the enforcement pyr- self-evident: the TK/GR disclosure 3 w w w.pubpat.org amid would work together both to argument is perhaps less so. Patent- 4 w w w.etcgroup.org/en/issues/ protect TK and GR from misappro- ing raw data, e.g., genetic sequenc- intellectual_property_patents.html priation and to ensure that the cus- es, and then withholding it or only 5 w w w.centerforfoodsafety.org todians of TK and GR would be com- making it available through com- 6 In May, Canadian court s finally set a pensated sufficiently to ensure the plex licensing and confidentiality trial date to determine Monsanto’s sustainable use of biodiversity and contracts not only inhibits individ- liability for contaminating Percy Schmeiser’s canola crops, the result of individual resources. One matter to ual product innovation but can also 40 years of plant breeding. be enforced will concern the estimat- confine research agenda to that w w w.percyschmeiser.com ed economic value of TK and GR in- which patent lawyers allow. Allow- 7 w w w.lexum.umontreal.ca corporated into patented products ing biodiversity, TK and GR to erode 8 w w w.tradeobservatory.org/ and processes. 10 by denying the need to conserve it library .cfm?refID=88376 There is no agreed methodology and pay the custodians of that con- 9 WIPO/GRTKF/IC/11/5(a) Add. 2 for estimating the economic value of servation prevents innovation for 10 w w w.cgkd.anu.edu.au/menus/PDFs/ TK and GR used in patented/com- an array of future products, the va- Drahos_tkframework.pdf mercialised products. Without such rieties and number of which only the 11 w w w .law .duke.edu/boylesite

10 • Trade Insight • V ol.3, No.2, 2007 geographical indications Promoting Trade and Pro-Poor Growth through Geographical Indications

A GI-based industrial strategy provides a platform for South Asian producers to compete with multinationals in world markets but achieving success entails expenditure on international marketing and legal protection.

n Amrit Rajapakse

or much of the coverage of the other characteristic of the good is es- al knowledge (TK), or often a combi- FAgreement on Trade Related As- sentially attributable to its geograph- nation of both. pects of Intellectual Property Rights ical origin” (TRIPS Article 22.1). Such reputation has enabled (TRIPS) of the World Trade Organi- TRIPS has, however, set out which these products to command higher zation (WTO), developing countries GIs are eligible for protection, and prices over comparable products are saddled with onerous obliga- the scope of protection that Members from outside the geographical area. tions, the main beneficiaries of which must accord to eligible GIs. However, this depended on wheth- are entities located in the developed This article discusses some of the er or not they are different from other world. The reason is that the vast ma- main issues surrounding protection goods. This led to the introduction jority of copyright materials, comput- of GIs and their potential to contrib- into trade of various designations to er programmes, patents and trade- ute to increased trade and economic identify the geographical origin of marks that Members undertake to development in South Asia. goods. Examples are guild marks, he- protect are owned by enterprises in raldic symbols and the direct use of developed countries. Most develop- What are GIs? the geographical names of countries, ing country enterprises lack the fi- Although GIs appeared for the first regions and localities, as in the case nancial, technological and skilled time as a subject of protection of IPRs of Champagne, Scotch whisky, Ched- human resources to trade in these in the TRIPS Agreement, its use dates dar cheese, etc. subjects of intellectual property back to the very earliest times of trade The present concept of GIs in the rights (IPRs). among societies and nations. Since TRIPS Agreement shares all these es- One category of intellectual prop- antiquity, certain geographical areas sential features of their historical an- erty protected in TRIPS – geographi- have been famous for producing cer- tecedents. As TRIPS makes it clear, a cal indications (GIs) – has signifi- tain products, which were much val- GI can be a geographical name, a fan- cant trade potential for developing ued in trade, e.g., Arabian horses, ciful name or a symbol, so long as it countries, and in particular, for South Persian carpets and Chinese silk. The can identify the goods in question Asia. GIs are defined as “indications reputation enjoyed by these products with their geographical origin. Sec- which identify a good as originating has been either due to natural fac- ondly, the goods in question must in the territory of a Member, or a re- tors such as soil and climate, or hu- possess some unique quality, reputa- gion or a locality in that territory, man factors such as particular man- tion or other characteristic that is essen- where a given quality, reputation or ufacturing techniques and tradition- tially attributable to its geographical

Vol.3, No.2, 2007 • Trade Insight • 11 geographical indications

origin . Therefore, an actual quality dif- GIs in South Asia rival producers often resort to dis- ference is not necessary, if a special The South Asian region is home to honest or “sharp” practices in an at- reputation can be built around a geo- several world-renowned GIs, two of tempt to appropriate some part of graphical area. This can be achieved which being Basmati rice and Dar- those profits for themselves. Three through effective marketing . jeeling tea. The leading Sri Lankan such typical responses are false use GIs are Ceylon tea and Ceylon cin- of GIs, deceptive use of GIs and free- Benefits of GIs namon, both of which receive higher riding on the reputation of GIs. The main benefit associated with GIs prices, on an average, in world mar- False use of GIs refers to using a is the prospect of higher profits for kets than other origins of tea and cin- GI for a product that does not origi- producers of the GI good, through namon. Furthermore, there could be nate in the indicated origin, e.g., la- selling prices over and above the many less known products that have belling Kenyan tea as “Ceylon” or prices of the same type of product GI potential and the process of in- “Darjeeling.” On the other hand, de- produced outside the geographical dustrialisation could also create new ceptive use of a GI refers to use of a area in question. For example, Ital- GIs, e.g., computer motherboards as GI that is literally true but mislead- ian Toscano olive oil (i.e., from the in the case of Taiwan. ing . This is the case where there are Tuscany area) receives a 20 percent Realising the potential benefits of two places that have the same geo- price premium over the price of stan- GIs for producers in South Asia, graphical name but only one is fa- dard Italian olive oil; Bresse poultry however, depends on three critical mous for producing a particular in France sells for four times the price factors – marketing, legal protection, product. The use of that name for a of regular poultry meat; and Italian and the distribution of bargaining product of that kind made in the oth- Parma ham sells at a premium of up power and domestic value addition er place would be literally true but to 50 percent over other cured hams. in the industry value chain. mislead consumers. There are two further benefits of The role of marketing is to make Free-riding refers to a case where GIs that are of particular value to de- consumers aware of the geographi- there is no consumer deception, e.g., veloping countries and their produc- cal origin-based qualities, character- labels such as “American Basmati” ers. First, by their very nature GIs tend istics or reputation of the products, and “Champagne-style wine.” Here to be associated with agricultural and to associate the particular GI consumers know that the goods are products and products that utilise with, and attach a value to, those qual- not the “real thing.” Nonetheless, TK. These products tend to be main- ities or characteristics or that reputa- such use is detrimental to genuine ly concentrated in rural areas, the size tion. The other two requirements are producers because it takes away of production units is small and gen- discussed in the following sections. business from them and dilutes the erally labour-intensive practices are reputation of the GI. In the latter case, utilised in their production. There- Need for legal protection the GI may become a “generic” term fore, by enabling higher prices and The need for legal protection for GIs – the common term for goods of that profits for the producers of GI prod- is tied to their economic value. As kind wherever produced , as happened ucts, GIs help to improve rural in- goods designated by GIs become suc- with Cheddar cheese and Dijon mus- comes and sustain rural employ- cessful and attract price premiums, tard. They are then no longer GIs and ment, stemming rural-urban migra- cannot be protected. tion. This is particularly relevant to the countries of South Asia. Realising the potential GI protection under TRIPS and The other benefit is that GIs can national law reduce the advertising cost for pro- benefits of GIs for TRIPS sets out the basic protection ducers from the GI area. This is be- that Members must provide for GIs. cause the GI conveys essential infor- producers in South To be eligible for protection, the indi- mation about the product to consum- Asia depends on three cation has to firstly satisfy the defi- ers, where normally this would have nition of a GI. Secondly, Article 24 of to be undertaken by individual pro- critical factors – the Agreement provides that protec- ducers, for their individual products. marketing, legal tion may be denied to a GI that has For example, most consumers will become a generic term in the Mem- spend more for a French perfume or protection and the ber where protection is sought, or a Swiss watch even if they do not distribution of where the GI is not protected, or has know about the enterprise that actu- fallen into disuse, in its country of ally produced it because of the repu- bargaining power and origin. tation of the respective country for domestic value addition The characteristic of TRIPS is that particular product. Therefore, that it then prescribes two levels of this feature of GIs is very beneficial in the industr y value protection that Members must pro- to producers in developing countries vide for eligible GIs – one level for when competing with large multina- chain all GIs and a higher level of protec- tionals in world markets. tion for GIs for wines and spirits.

12 • Trade Insight • V ol.3, No.2, 2007 geographical indications

The basic protection is contained in cutting and polishing in Sri Lanka Article 22 of the Agreement and re- The TRIPS for the manufacturing of jewellery quires Members to protect all GIs abroad. against false and deceptive use and Agreement lays down The distribution of bargaining against acts of unfair competition as the basic standards power in the industry value chain defined in the 1967 Paris Conven- is also a key determinant of wheth- tion for the Protection of Industrial of GI protection to er the benefit of higher prices re- Property. All GIs are also to be pro- be guaranteed by all mains with the exporters or is passed tected against being registered in down the value chain in the form of trademarks for goods not originat- WTO Members but it higher wages for workers and high- ing in the territory indicated by the er prices for intermediate inputs. For GI, if it would mislead the public as leaves Members free example, despite the high prices to the origin of the goods. However, to adopt any national earned by Ceylon tea, cinnamon this right does not apply where the and sapphires, tea pluckers, cinna- trademark was applied for or regis- means to implement mon peelers and gem miners con- tered in good faith prior to TRIPS com- the requisite tinue to be in the highest poverty ing into force in that Member, or pri- brackets in Sri Lanka. In such cas- or to the GI being protected in its home protection within es, there may be a market failure country . their territories necessitating corrective regulatory GIs for wines and spirits benefit intervention. in addition from protection against free-riding (Article 23). GIs for wines tensive protection than TRIPS. For Conclusion are also entitled to protection for example, GIs may be protected un- A GI-based industrial strategy has homonymous indications (e.g., the der certain national systems irre- a great potential to sustain rural em- “Rioja” indication, which is a GI for spective of protection in their coun- ployment and improve rural liveli- wine from Spain and from Argenti- try of origin, while some systems pro- hood, and provides a platform for na), and to have negotiations in the vide the higher level of protection South Asian producers to enh ance Council for TRIPS for the establish- TRIPS accords to GIs for wines and their competitiveness in the interna- ment of a multilateral system of GI spirits to GIs for all goods. tional market. However, success en- notification and registration. The implication of the foregoing tails expenditure on international Although TRIPS lays down the is that obtaining legal protection for marketing and legal protection, so basic standards of GI protection to South Asian GIs in their key over- the decision to go for a GI approach be guaranteed by all WTO Members, seas markets is an exercise requir- should be based on a careful cost- it leaves Members free to adopt any ing substantial legal expertise, benefit analysis. Governments and national means to implement the req- which could entail significant ex- industry regulators will need to uisite protection within their territo- pense. For example, in the case of work closely with the local indus- ries. As a result, there is a substan- the Ceylon tea, GI registration in try, and also need to institute appro- tial diversity in national systems of some key markets had to be aban- priate policies to promote greater GI protection. A WTO survey 1 iden- doned because of the high cost of domestic value addition and to en- tified three broad types of national foreign law firms. sure an equitable distribution of ben- approach to protect GIs – under laws efits to workers and intermediate focusing on business practices and Equitable distribution of gains producers in the industry value consumer protection; under trade- The third requirement in realising chain. n mark law; and under special systems the potential benefits of GIs for pro- of protection. ducers in South Asia relates to the The author was associated with the In practice, many countries, in- distribution of bargaining power Institute of Policy Studies (IPS), cluding Sri Lanka, follow a combi- and domestic value addition in the Colombo, Sri Lanka. nation of all three types of approach industry value chain. Many GI prod- to protect GIs. While each approach ucts are exported with minimal val- differs from the other in terms of the ue addition for further processing eligibility criteria for protection and and sale abroad. Therefore, the bulk scope of protection, there are also of the consumer price premiums as- Note substantial differences in the appli- sociated with the GI are captured by 1 cation of the same approach between W TO. 2003. Review under Article 24.2 of foreigners. This is the case with Dar- the Application of the Provisions of the different countries. In addition, na- jeeling tea, where India exports most Section of the TRIPS Agreement on tional systems also differ in impor- of the tea in bulk form for value addi- Geographical Indications: Summary of tant respects from the protection tion (e.g., manufacture of tea bags and the Responses to the Checklist of Questions. (IP/C/13 AND ADD.1). Note by mandated by TRIPS, with many na- tea packets) abroad. Similarly, most the Secret ariat. IP/C/W/253/Rev.1. tional GI systems granting more ex- Ceylon sapphires are exported after Council for TRIPS.

Vol.3, No.2, 2007 • Trade Insight • 13 cover feature

Intellectual Property Rights and Development Concerns in South Asia

South Asian countries should utilise TRIPS flexibilities as well as the window provided by the review of TRIPS Article 27.3 (b) to ensure a more balanced approach to intellectual property protection.

n Ratnakar Adhikari

ntellectual property refers to the creation of the mind in the form Iof ideas. Intellectual property rights (IPRs) bestow the creator of such ideas ownership rights and le- gal protection over the use of the cre- ation for a limited period. The cen- tral premise of this system is that the creator of intellectual property needs to earn credit and thereby economic rents for his/her efforts in the devel- opment and marketing of the idea. Essentially, the system is supposed to encourage innovation by restrict- ing the imitation of ideas by others for a limited period in the fields of art, science, technology and indus- try. IPRs have, to some extent, con- tributed to the achievement of these objectives. One might wonder then why the majority of developing countries are opposing the IPR regime under the sanction-based mechanism of the multilateral trade body – the World Trade Organization (WTO). The way the global IPR regime has been designed and is being im- plemented, it appears that IPRs have only served the corporate agenda

14 • Trade Insight • V ol.3, No.2, 2007 cover feature pushed by knowledge-intensive sec- veloped. 1 This is a region where one- ganisations (CSOs). tors such as pharmaceutical, agro- fifth of humanity and a majority of CSOs such as Medicines Sans chemical, biotechnology and infor- the world’s poor live. Many people Frontier (MSF) and Oxfam Interna- mation technology of the developed in the region are food insecure and tional, along with several develop- countries. At the behest of these in- lack access to education, safe drink- ing country governments, were also terests, their governments have ing water, sanitation, and other meth- instrumental in lobbying for the brought the issue of IPRs into the in- ods and mechanisms to prevent dis- adoption of TRIPS and Public Health ternational forum with a view to set- eases. These have made a majority of Declaration during the fourth Min- ting a uniform global standard. South Asians vulnerable to pandem- isterial Conference of the WTO held Although the World Intellectual ic such as diarrhoea, cholera, viral in Doha in November 2001. One of Property Organisation (WIPO) was hepatitis, tuberculosis, malaria and the major achievements of the Decla- entrusted with the responsibility of HIV/AIDS. The pharmaceutical in- ration was to clarify the provision of promoting the protection of intellec- dustry in the region is still nascent Article 31 (f) of TRIPS, which allows tual property throughout the world and only India possesses the capac- WTO Members to issue compulsory through cooperation among Member ity to manufacture and export medi- licensing in the event of a public States as well as in collaboration cines and vaccines to other countries health crisis or in public interest. with other international organisa- in the region. However, the issue of how countries tions, developed countries were ap- without domestic manufacturing parently not happy with its func- capacity should make use of this sys- tioning, primarily due to the absence TRIPS, in its present tem (often referred to as paragraph 6 of a binding and effective dispute set- system) remained unclear until this tlement mechanism in case of in- for m, has implica tions matter was resolved on 30 August fringement of IPRs (Katti and Mukho- 2003. Critics argue that the formali- padhyay 2000). Hence, despite stiff for several areas, which ties to be fulfilled are extremely oner- resistance, developing countries are important from ous, making it almost impossible to were cajoled into signing the Agree- utilise this provision when it is need- ment on Trade Related Aspects of In- the development ed the most. The fact that only one tellectual Property Rights (TRIPS), perspective of South country has utlised this provision, which became part and parcel of the that too with great difficulty, 2 lends WTO when it came into being on 1 Asian countries credence to this argument. January 1995. While the Declaration has pro- TRIPS, in its present form, has vided a sense of respite for the least implications for several areas, which Since South Asia is a major mar- developed countries (LDCs) in the are important from the development ket for the pharmaceutical giants of region because they are not required perspective of South Asian countries. the developed countries, they can to provide patent protection on phar- In the process of serving private com- exercise monopoly control over the maceutical products until 2016, oth- mercial interests, the Agreement South Asian market by refusing to er countries were required to provide tends to negate public interests, in- license their patented technology this protection with effect from 1 Jan- cluding the rights of farmers, stu- and preventing parallel import (i.e., uary 2005. After India amended its dents, small researchers, sick and import of the products manufactured Patent Law in 2004 to fulfil this obli- elderly people and indigenous by own company abroad). Although gation, it was feared that the prices c o m munities of the developing some remedies exist against such of medicines would increase astro- countries. Moreover, the attempts practices in the TRIPS Agreement, all nomically as India’s ability to man- made by developed countries to the countries in South Asia may not ufacture generic versions of products ratchet up IPR standards have cre- be able to take recourse to such mea- still under patent would be severely ated daunting challenges. Develop- sures, mainly due to lack of capacity restricted. However, the Patent Office ing countries thus need to devise to use them and “political reasons”. of India is still sensitive to these con- proactive strategies to address the However, two such measures taken cerns and has not granted indiscrim- challenges associated with the ne- in the past by the governments of inate patents on medicines so far. gotiation and implementation as- South Africa and Brazil to provide The Indian judiciary is found to be pects of IPR rules. This article at- anti-retroviral (ARV) therapy to their equally responsive (See Box 1). tempts to identify such challenges HIV/AIDS patients are still in force, The TRIPS and Public Health and proposes some policy options despite the challenges to these mea- Declaration also led to increased at- for the South Asian countries. sures by the pharmaceutical compa- tention towards making an explicit nies and their governments provision in national legislation for Access to medicine (Adhikari 2004). The stand taken by compulsory licensing, authorising The South Asian region comprises these governments was further governments to use patent – referred eight countries, among which three strengthened by the support they re- to as “government use authorisa- are developing and five are least de- ceived from several civil society or- tion”. A few Asian developing coun-

Vol.3, No.2, 2007 • Trade Insight • 15 cover feature

Box 1: Novartis Loses Patent Law Challenge plemented such a regime. One of the proposals currently In 2006, the Indian Patent Office rejected a patent application for Glivec, a submitted by a group of developing cancer drug manufactured by Swiss-based pharmaceutical giant Novar- countries led by India and Brazil for tis, on the grounds that its subject matter was anticipated and obvious in the review of Article 27.3 (b) of TRIPS the light of prior art and the drug did not show sufficient enhancement of demands that TRIPS incorporate a efficacy over the molecule imatinib, on which Glivec is based. provision on “disclosure” of source Section 3(d) of the Indian Patent Act, under which the patent was de- of origin as a positive obligation for nied, prohibits the granting of patents to inventions involving “a new patent applicants. This proposal, form of a known substance which does not result in the enhancement of which is being opposed by a select the known efficacy of that substance.” The provision was adopted in order group of countries led by the United to curb frivolous patent applications and to avoid unnecessary delays in States (US) and Japan, is aimed at introducing generic versions of brandname medicines to the market through providing a basis for tracking down the “evergreening” of existing patents based on minor changes in a drug’s spurious patents, ensuring that cor- composition or use. porate interests respect the ABS re- Consequent to the Glivec patent rejection, Novartis filed a case with the gime of the country of origin of ge- Madras High Court in Chennai alleging that Section 3(d) was unconstitu- netic resources. tional and incompatible with the TRIPS Agreement. The High Court ruled Similarly, in relation to the pro- on 6 August that Section 3(d) was not unconstitutional, vague or arbitrary tection of plant varieties, South Asian as alleged by the complainant. Citing “no jurisdiction to decide on the countries feel that a sui generis legis- validity of the TRIPS Agreement”, it declined to rule on whether the na- lation, that protects the rights of tional law was compatible with the WTO treaty. breeders without affecting, among While health activists have welcomed the decision, Novartis deplored others, the rights of farmers to save, the verdict but said it would not appeal the decision to the Indian Supreme use, exchange and sell seeds, would Court. A WTO dispute brought by Switzerland – the only way to clarify the best serve their interest. However, TRIPS compatibility issue – is also unlikely. As a result, the company due to pressures from breeders’ lob- plans to shelve its investment plan in India. by and their governments, which want them to adopt the model pre- Source: ICTSD (2007) scribed by the International Union for the Protection of New Varieties of Plants (UPOV) 3, most countries in tries have amended their IPR legis- breeders of developed countries, jeop- the region are facing problems to im- lation to take advantage of this flexi- ardising, in particular, the rights of plement a sui generis plant variety bility. Examples include Malaysia, developing country farmers. protection regime. Indonesia and Thailand (See related Local, indigenous and farming While India, after implementing a article on page 27). South Asian coun- communities of mega-diverse re- path-breaking farmer-friendly legisla- tries should also make use of this flex- gions, which have conserved and tion, has decided to join UPOV 4, Bang- ibility while amending or enacting nurtured resources for several gen- ladesh was asked to join the Union their IPR legislation. erations but are either ignorant or as part of a trade and aid deal it signed lack negotiation skills, can lose in- with the European Union (EU) and Protection of biodiversity and centives to conserve these resources, Nepal was pressurised to join the farmers’ rights should the trend of biopiracy contin- same at the time of its accession to the Article 27.3 (b) of TRIPS, which is ue. Moreover, the lack of necessary WTO (Adhikari and Adhikari 2003). considered the most contentious pro- legal expertise in the countries of the Fortunately, none of these countries vision in the entire Agreement, al- region (except India) means that ini- have, so far, joined UPOV. Similarly, lows for the patenting of life forms tiating legal challenges for getting Pakistan and Sri Lanka are under and calls for mandatory protection spurious patents revoked is not an pressure to follow the model pre- of plant varieties either through pat- easy task. scribed by UPOV while designing ents, or an effective sui generis sys- The Convention on Biological their plant variety protection legisla- tem, or any combination thereof. Diversity (CBD) 1992, which has tion, if not join the Union. While the first part of this Article been signed and ratified by all South seems to have been primarily de- Asian countries, mandates the im- Technology transfer signed by the biotechnology and plementation of national regimes on Technology transfer and diffusion pharmaceutical lobby in the devel- access and benefit sharing (ABS), can contribute to economic develop- oped countries to legitimise “biopi- obliging parties obtaining genetic ment via the productivity growth racy” (See Box 2) and negate the resources to share benefits with the they generate. However, South Asian rights of local and indigenous com- original donor(s) of the resources. countries lag behind on the techno- munities, the second part strength- However, except for India, none of logical front and face a huge tech- ens the hands of commercial plant the countries in the region have im- nology gap. They not only have lim-

16 • Trade Insight • V ol.3, No.2, 2007 cover feature ited capacity to generate technology of technological advancement in de- First, the WIPO forum, which is in but also lack requisite infrastructure veloping countries themselves. the process of negotiating Substantive and legal mechanisms to make best Patent Law Treaty (SPLT), is being use of the acquired technology. Efforts to ratchet up IPR utilised by the developed countries to Since technology transfer takes standards create a multilaterally binding agree- place at the micro level, it is difficult Despite the absence of a focus on de- ment aimed at diluting the flexibili- to design a macro-level policy to fa- velopment, TRIPS does contain some ties contained in TRIPS. Critics argue cilitate technology transfer, primari- flexibilities, which, if used construc- that even the so-called WIPO Devel- ly from developed countries to devel- tively, can help developing countries opment Agenda does not contain oping ones. TRIPS, at the insistence protect their national interest. After much in substance to help develop- of developing countries, has incor- failing to further enhance the level of ing countries address their develop- porated a few provisions to facilitate IPR protection or to protect the inter- ment concerns (Finger 2007). the process of creating a multilateral est of their corporate sector (as is ev- Second, countries acceding to the regime on technology transfer. Arti- ident from the case of pharmaceuti- WTO are being pressurised, during cle 7 of TRIPS, which lays down the cal patents in Brazil, South Africa bilateral negotiations, to accept sev- very objective of the Agreement, notes and India, or their inability to make eral TRIPS plus conditions. Exam- that IPRs should contribute to the all developing countries agree to fol- ples include an explicit requirement promotion of technological innova- low the UPOV model while design- to accept the UPOV membership in tion and the transfer and dissemina- ing their plant variety legislation), lieu of the TRIPS-sanctioned model tion of technology. Similarly, Article developed countries are making ev- of sui generis legislation for the pro- 8.2 recognises that countries may ery possible effort to ratchet up IPR tection of plant varieties, which coun- wish to adopt policies to prevent the standards and impose “TRIPS plus” tries like Cambodia, China and Kyr- abuse of IPRs by rights holders or conditions on the developing coun- gyzstan were forced to accept the use of practices that “adversely tries. They are making use of what is (Adhikari and Adhikari 2003). affect the international transfer of known as “forum shifting” tactic by Third, bilateral free trade agree- technology.” Both these provisions using three major platforms to rea- ments (FTAs), between the devel- provide, in theory, a much-needed lise their objectives. oped and developing countries, in- leeway for the developing countries to acquire foreign technology. How- Box 2: Biopiracy – A Major Concern for South Asia ever, since the se provisions are “best endeavour” in nature ,the potential Biopiracy is a process for their legal enforceability is, at whereby “corporate in- best, uncertain. terests” and researchers It is also necessary to see as to take away genetic re- what is the fate of a seemingly bind- sources and associated ing provision of TRIPS. Article 66.2 traditional knowledge of the Agreement requires developed from the local, indige- Members to provide incentives to nous and farming com- enterprises and institutions in their munities and patent territories for the purpose of promot- them (as if they have in- ing technology transfer to the LDCs vented the products) af- in order to enable them to create a ter minor modifications. sound and viable technological Biopiracy does not mere- base. Despite the use of the word ly mean unauthorised “shall” in the text of the Article, extraction and use of bi- which is considered more binding ological and genetic re- in legal parlance, developed coun- sources but also denotes authorised extraction and use of such resourc- tries have not done enough to opera- es on the basis of an exploitative transaction. Such exploitative transac- tionalise it. One reason is the lack of tion occurs, when, among others, donors of the resources (who are the monitoring mechanism, another be- most ill-informed) are not adequately compensated. ing the conspicuous absence of any Patents have been granted on several properties of plants, which milestone and deadline to realise the are endemic to Asia in general and South Asia in particular. Examples “intended” objectives. include the patenting of Basmati rice as well as select properties of This calls for not only a binding bitter gourd, neem and turmeric by corporate interests and research regulation on technology transfer but institutions in the US and Japan. While some of these patents have been also exploring the possibilities of revoked after legal challenges, others are still in force. n South-South cooperation on this is- sue and providing fiscal incentives, Source: Dutfield (2004); Adhikari and Adhikari (2007) if necessary, to facilitate the process

Vol.3, No.2, 2007 • Trade Insight • 17 cover feature

clude provisions that go far beyond References the requirements of TRIPS. For ex- The debate on the ample, the provisions on compulso- development dimension Adhikari, Ratnakar and Kamalesh ry licensing and parallel import Adhikari. 2007. “Review of Article 27.3 were excluded from the text of the of IPRs has further (b) of TRIPS Agreement: Policy Issues for US-Singapore and US-Morocco South Asia.” Policy Brief No. 14. intensified in the wake Kathmandu: South Asia Watch on T rade, FTAs (Gibbs and Wagle 2006). Sim- Economics & Environment (SAWTEE). ilarly, an explicit requirement to al- of various tactics low the patent ing of plant s (with- —. “UPOV: Faulty Agreement and Coercive Practices.” Policy Brief No. 5. out any exception whatsoever) is in- followed by developed Kathmandu: South Asia Watch on T rade, cluded in the US FTAs with Sin- countries to ratchet up Economics & Environment (SAWTEE). gapore, Morocco, Bahrain and Adhikari, Ratnakar. 2006. “Bilateral Free Oman (Adhikari 2006). Finally, most IPR standards T rade Agreements and Farmers’ FTAs signed by the US and under Livelihood: Issues for South Asian the European Free Trade Area Countries.” Policy Brief No. 13 . (EFTA) contain a provision requir- dimension of IPRs has further inten- Kathmandu: South Asia Watch on T rade, Economics & Environment (SAWTEE). ing developing countries to become sified in the wake of various tactics a member of UPOV (Adhikari 2005). followed by developed countries to —. 2005. “Emerging Issues Relating to Countries characterised by the ratchet up IPR standards. In this re- TRIPS and Biodiversity: Development Implications for South Asia.” In South existence of a vibrant civil society, gard, South Asian countries should Asian Y earbook of Trade and Develop- free flow of information and culture emulate the models of other Asian ment , 261-288. New Delhi: Centre for of informed discussion and debate countries to safeguard their interests. Trade and Development (CENTAD). have not, however, agreed to one-sid- A well-coordinated national strategy, —. 2004. “Interfacing Competition Policy ed conditions imposed by the devel- developed in consultation with all the with IPR.” The Kathmandu Post, 6 and 7 oped countries. For example, two relevant stakeholders, can help solid- February. Asian countries, namely Malaysia ify their negotiating position, thereby Dutfield, Graham. 2004. “What is and Thailand, which are at various thwarting any attempt to undermine Biopiracy?” Paper presented at Interna- stages of FTA negotiations with the development concerns. n tional Expert W orkshop on Access to Genetic Resources, 24-27 October, in US, have demonstrated their will The author is Executive Chairman, Cuernavaca: Comision Natcional para el power to resist such pressures SAWTEE. Uso y Conocimiento de la Biodiversidad (Adhikari 2006). (Conabio). Finger, Michael J. 2007. “The WIPO Conclusion Notes Development Agenda.” Issue Paper. The debate on the development di- Kathmandu: South Asia Watch on T rade, 1 mension of IPR s caught the atten- While India, Pakistan and Sri Lanka are Economics & Environment (SAWTEE). developing countries, Afghanist an, tion of various stakeholders in South Bangladesh, Bhutan, the Maldives and Gibbs, Murray and Swarnim Waglé. Asia, particularly in the aftermath Nepal are LDCs. 2006. “The Grate Maze: Regional and of the inclusion of TRIPS in the sanc- Bilateral Free T rade Agreements in Asia.” 2 Rwanda was the first country to notify Policy Paper . Colombo : UNDP Asia tion-based mechanism of the WTO. the WTO (on 19 June 2007) that it would Pacific Regional Centre. Several developing c ountries that be making use of this provision. See have utilised the flexibilities con- W TO 2007. Recently, Apotex – a generic International Centre for Trade and Sustainable Development. 2007. “Canada tained in the Agreement have been drug manufacturing company in Canada – obtained compulsory licence to Issues Complusory Licence for HIV/AIDS able to protect their national inter- manufacture and export anti-retroviral Drugs Export to Rwanda in First Test of est to a significant extent. Therefore, medicine under the name Apo-Triavir to W TO Procedure.” Bridges Weekly Trade Rwanda (See related news on page 5). News Digest Vol. 11. No. 32. 26 South Asian countries should also September. utilise TRIPS flexibilities and the 3 The UPOV Convention was created in window provided by the review of —. “Novartis Loses Patent Law Chal- 1961 at the behest of the European lenge.” Bridges Monthly Review, Y ear 11, Article 27.3 (b) to ensure a more bal- breeders. It has undergone three No. 5 ,August 2007: 10. anced approach to intellectual prop- revisions since it was signed in 1961. The 1972, 1978 and 1991 amendments erty protection. Katti, V ijaya and Somasri Mukhopadhyay. to UPOV progressively strengthened the 2000. “Intellectual Property Rights under W ith regard to technology trans- protection accorded to plant breeders. the World Trade Organization.” In Seattle fer, South Asian countries should try UPOV 1991 provides the highest and Beyond: The Unfinished Agenda, ed. to rely more on home-grown solu- possible level of protection to the B. Bhattacharyya. New Delhi: Indian breeders, severely restricting farmers’ Institute of Foreign Trade. tions . However, at the same time , rights to save, reuse, exchange and sell they should also negotiate for mak- seeds (See Adhikari and Adhikari 2003). WTO. 2007. “Patents and health: WTO ing the provisions on technology receives first notification under ‘para- 4 transfer within the multilateral re- The decision is, however, pending due graph 6’ system.” 19 June. http:// to a public interest litigation filed by a w w w.wto.org/english/news_e/ gime more explicit and binding. leading India-based NGO – Gene news07_e/public_health_july07_e.htm The debate on the development Campaign. (accessed 21 September 2007).

18 • Trade Insight • V ol.3, No.2, 2007 Dohadoha Work round Programme issues

Making Use of IPR Decisions of the Doha Work Programme THE CASE OF INDIA

Almost all the TRIPS-related issues of the Doha Work Programme are in limbo and the blame lies with the developing countries as they are not being proactive in global negotiations on IPRs.

n B. K. Keayla

he fourth Ministerial Conference to the extension of protection of Tof the World Trade Organization GIs provided for in Article 23 to (WTO) held in November 2001 in products other than wines and Doha is important in many respects. spirits to be addressed in the The conference adopted a Ministeri- Council for TRIPS as an outstand- al Declaration, which, inter alia, dealt ing implementation issue. with a broad and balanced Work Pro- • Patentability: Review of TRIPS Ar- gramme – known as the Doha Work ticle 27.3 (b) relating to patentabil- Programme. ity of micro-organisms and non- A number of issues such as agri- biological and micro-biological culture, services and non-agricultur- processes. al market access (NAMA) were in- • Review of Article 71.1: Review of Paragraph 12 (b) of the Ministerial cluded in the Work Programme. The the implementation of Article 71.1 Declaration also provides that the Doha Work Programme also deals of the TRIPS Agreement and oth- outstanding implementation issues with issues relating to implementa- er relevant new developments shall be addressed as a matter of pri- tion of intellectual property rights foreseen by Members. ority by the relevant WTO bodies. (IPRs) covered by the Agreement on • Relationship between TRIPS and the A number of countries, including Trade Related Aspects of Intellectu- Convention on Biological Diversity India, submitted their views on the al Property Rights (TRIPS). A sepa- (CBD): Examine, inter alia, the re- above issues to the concerned nego- rate declaration – Declaration on the lationship between TRIPS and tiating groups. It is observed from the TRIPS Agreement and Public Health CBD, the protection of traditional deliberations in the General Council – was also adopted in a manner sup- knowledge and folklore. during its meetings held during 27- portive of public health by promot- • Trade and technology: Examination 29 July 2005 that progress in negoti- ing both access to existing medicines in a Working Group under the ations on TRIPS-related issues have and research and development auspices of the General Council been rather slow or incomplete. Some (R&D) for new medicines. of the relationship between trade of the relevant aspects of these issues The various TRIPS issues incor- and transfer of technology and in- are discussed in this article. porated in the Doha Work Pro- creased flows of technology to de- gramme are as follows. veloping countries. Protection of GIs During the Uruguay Round of trade • Implementation of TRIPS Article The Ministerial Declaration in negotiations , only wines and spirits 23.4: The Ministerial Declaration Paragraph 19 thereof also stipulates were identified for GI protection. agreed to negotiate the establish- that in undertaking the Work Pro- These products are relevant for few ment of a multilateral system of gramme mentioned above, the Coun- Members only. The other countries notification and registration of cil for TRIPS shall be guided by the failed to identify their products for a geographical indications (GIs) for objectives set out in Articles 7 and 8 similar protection. Article 23 (4) of wines and spirits. The Declara- of TRIPS and shall take fully into ac- TRIPS stipulates that “in order to fa- tion also noted the issues relating count the development dimension. cilitate the protection of geographical

Vol.3, No.2, 2007 • Trade Insight • 19 doha round issues

indications for wines, negotiations of plants or animals other than non- Microbiological Inventions” pre- will be undertaken in the Council for biological and micro-biological pro- pared jointly by the European Patent TRIPS concerning the establishment cesses” are excluded from patentabil- Office, the Japanese Patent Office and of a multilateral system of notification ity. This sub-article also provides the United States (US) Patent and and registration of geographical in- that this provision shall be reviewed Trademark Office in 1988 also did dications for wines eligible for pro- four years after the date of entry into not mention the definition of micro- tection in those Members (meaning all force of the WTO Agreement. The organism as such. In the absence of a WTO Members) participating in the mandated review process started in clear-cut definition of micro-organ- system”. This indicates that the Coun- 1999 but until now there has not been ism, it is rather problematic to decide cil for TRIPS would be addressing is- any final decision on this issue. the scope of patentability on such sues relating to the establishment of a Micro-organisms as such occur in organism. multilateral system of notification and nature and whenever any new micro- The naturally occurring micro- registration of GIs only for wines and organism is discovered, the same has organisms when genetically modi- spirits. to be considered as a discovery and fied do involve human input and as Regarding the issue of extending not an invention. In view of this, since such it could be considered to have the system to other countries, India micro-organisms are not invention s, incorporated an inventive step. How- has enacted the Geographical Indi- they should not be patent ed . The Ox- ever, such micro-organisms are use- cations of Goods (Registration and ford Dictionary defines micro-organ- ful only for performing certain activ- Protection) Act, 1999. Under this Act, ism as “an organism not visible to the ities. Thus, the best course would be protection is extended to agricultur- naked eye, e.g. bacterium or virus”. to provide for process patent for ge- al goods, natural goods or manufac- Based on this definition, it can be ar- netically modified micro-organisms. tured goods or any goods of handi- gued that since micro-organisms are It is unfortunate that the Govern- craft or goods of industry, including not visible to the naked eye, they ment of India has made a provision food stuff. This would prevent un- should not be classified as products in the Amended Patents Act, 1970 for authorised persons from misusing and product patent should not be the protection of micro-organisms. GIs, protect consumers, add to the applicable to them. Having done this damage, the only economic prosperity of the produc- Interestingly, the Budapest Trea- course left to resolve the issue could ers of such goods and also promote ty on the International Recognition be that the application of provision goods bearing Indian GIs in the ex- of the Deposit of Micro-organism for relating to protection of micro-organ- port market. India has many prod- the purpose of patent procedure does isms should be notified only after the ucts requiring international protec- not include any definition of micro- review has been concluded by the tion under this system. organism, although it defines other WTO. India could then abide by the At present, a GI is protected in the seemingly unambiguous terms such decision that may be taken by the country of its origin and there is no as “patent procedure”, “intergovern- WTO for multilateral application. It obligation under TRIPS for other mental industrial property organiza- will not be out of place to mention countries to extend reciprocal protec- tion” and “industrial property of- here that renowned scientists are tion. However, under the Indian Act, fice”. The Treaty’s Regulations also also against the patenting of micro- the country would, on the other do not define micro-organism. The organisms and of any other life forms hand, be required to extend protec- World Intellectual Property Organi- as such. A Technical Expert Group tion to goods imported from other sation (WIPO) Committee of Experts established by the Government is countries, which provide for such on Biotechnological Inventions and examining this issue and its report is still awaited. There has not been any progress at the WTO forum, Since micro-organisms are not visible to the naked eye, though a number of countries have developing countries can argue at the Council for TRIPS submitted their views on whether or not patents should be extended to mi- that they should not be classified as products and product cro-organisms. patent should not be applicable to them Review of TRIPS Article 71 Article 71 of TRIPS stipulates that protection. In view of this, it is im- Industrial Property, which met be- “the Council for TRIPS shall review portant to have similar protection as tween 1984 and 1988, also did not the implementation of this Agree- is available to wines and spirits. define micro-organism. It, however, ment after the expiration of the tran- used the term micro-organism fre- sitional period referred to in para- Patentability of micro-organisms quently in the discussions, as is re- graph 2 of Article 65 (of TRIPS)”. TRIPS, in Article 27.3 (b), provides flected in the reports of the meetings According to Article 65, the transi- that “plants and animals other than of the Committee. The comparative tional period for the developing coun- micro-organisms and essentially bi- study of “Patent Practices in the Field tries ended on 31 December 1999. ological processes for the production of Biotechnology Related Mainly to Further, according to Article 71, “the

20 • Trade Insight • V ol.3, No.2, 2007 doha round issues

Council shall, having regard to the ket of the Member authorizing such “the term of protection available experience gained in implementa- use”. The use of the word “predomi- shall not end before the expiration of tion, review it in two years after that nantly” has become a matter of dis- a period of 20 years counted from the date, and at identical intervals there- cussion. When such a word is used filing date”. This term appears to be after”. Accordingly, the Council for for granting compulsory licence, it on the high side. The argument giv- TRIPS is also required to undertake means that there is a scope for meet- en for an enhanced term of 20 years reviews in light of any relevant new ing the demands other than that aris- was that it used to take 7-8 years to developments that might warrant ing in the domestic market, i.e., it grant patents. The reality, however, modification or amendment of should be possible to export the pat- is different now. The patent is grant- TRIPS. The above-stated mandated re- views have not even been initiated Ar ticle 31 (f) of TRIPS pr ovides that any use of compulsor y as there are several issues, which re- quire consideration by the Council. licensing shall be authorised predominantly for the supply of the domestic market of the Member authorising such (i) Article 27 paragraph (1) provides that the patent holder will enjoy use but the use of the word “predominantly” has become patent rights without discrimination a matter of discussion as to the place of invention, the field of technology and whether products are imported or locally produced. ented product by the compulsory li- ed in many cases within 1-2 years. This means that the imported patent- cence holder. This aspect needs to be Further new generation of products ed product by the patent holder has debated and clarified so that compul- are being introduced at a much fast- been absolved of the obligation to sory licence holders can play an ef- er pace affecting the utility of earlier produce the product in the country, fective role in outside markets. products. In view of these, there is a which grants the patent. This provi- It may be pointed out that Section strong justification for reducing the sion may only be relevant for small 84 (7) (a) (iii) of India’s Patents Act, long period of protection of 20 years. countries, not for big countries like 1970 provides that “the reasonable However, the best possible solution India. It is always possible to pro- requirement of the public shall be could be to revise Article 33 as fol- duce any new product in India with deemed not to have been satisfied – lows: the term of protection available economic viability as assured de- if, by reason of the refusal of paten- shall not end before the expiration of mand can be generated within a short tee to grant a licence or licences on a period of 20 years counted from the period. This issue needs to be re- reasonable terms for a market for ex- filing date or 12 years from the date viewed by the Council. port of the patented article manufac- of grant of the patent, whichever is In this regard, Section 83 of the tured in India is not being supplied earlier. This will clearly provide for Amended Patents Act, 1970 provides or developed”. This stipulation in the an effective use of patents for 12 “that patents are granted to encour- Indian law needs to be strengthened years. age inventions and to secure that the further using Article 31 (f) of TRIPS. inventions are worked in India on a No dispute should be raised on this (v) Article 27 of TRIPS stipulates that commercial scale to the fullest extent count in the country or at the WTO patent shall be available for any in- that is reasonably practicable with- forum. vention, whether products or pro- out undue delay”. This Section also cesses, in all fields of technology, pro vides “that (patents) are not (iii) Article 31 (h) of TRIPS provides provided they are “new, involve an granted merely to enable patentees that ”the right holder shall be paid inventive step and are capable of in- to enjoy a monopoly for the impor- adequate remuneration in the cir- dustrial application”. The terminol- tation of the patented article”. The cumstances of each case, taking into ogies mentioned above need to be implication of this provision is that account the economic value of the defined explicitly so that frivolous patent holders, when they are grant- authorization”. This provision is not claims are not filed. Regarding the ed patents under the Patents Act, explicit in the sense that there is nei- definition of invention, it would be 1970, have the obligation to produce ther a fixed royalty nor a ceiling on appropriate to define the same as the patented product in India and royalty. Absence of this aspect would “patentable basic invention”. The not resort to the import of patented raise disputes between the patent idea is that the research aspect is products to exploit the domestic holders and the licencees. It would applicable only to basic research market at monopoly prices. be appropriate if a specific provision and not for subsequent incremental is made on royalty payment. It is also modifications or additions to such (ii) Article 31 (f) of TRIPS provides that important to incorporate guidelines basic inventions. Similarly, for “any such use (compulsory licence) for arriving at a reasonable royalty. the pharma and chemical sectors, shall be authorized predominantly only basic molecules should be for the supply of the domestic mar- (iv) Article 33 of TRIPS provides that patentable.

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Patent rights provide exclusivity ensure that the terms and conditions On trade and transfer of technol- whereby others are legally prohibit- to which approval is granted secures ogy, Article 7 of TRIPS (on objectives) ed from exploiting the patent. Such equitable sharing of benefits arising provides that “the protection and en- an exclusive right ought to be extreme- out of the use of accessed biological forcement of intellectual property ly selective and provided to products resources, their by-products, innova- rights should contribute to the pro- of real basic research. Similarly, the tions and practices associated with motion of technological innovation other patent terminologies should their use and applications and and to the transfer and dissemina- also be defined appropriately. This knowledge relating thereto in accor- tion of technology, to the mutual ad- will facilitate the filing of patent dance with mutually agreed terms vantage of producers and users of claims and their examination by the and conditions”. technological knowledge and in a concerned patent control authority. In order to legalise benefit shar- manner conducive to social and eco- ing, suggestions have been made by nomic welfare, and to a balance of TRIPS and CBD several countries that, as a means of rights and obligations”. CBD was negotiated at Rio De Jan- benefit sharing, patent applicant s be The spirit of Article 7 is quite eiro in 1992. The Convention reaf- required to identify or indicate in their clear. What is needed is to provide firms that States have sovereign application s the source of any genet- for a specific provision for transfer rights over their biological resourc- ic material or traditional knowledge and dissemination of technology as es. Article 15 of CBD provides that used in developing their claimed in- and when compulsory licences are “access to such resources, where vention s. There is, however, hardly granted on patented product or pat- grante d shall be on mutually agreed any progress in the relevant Working ented process as the case may be. In- terms and prior informed consent of Group to resolve this issue. In addi- dia’s Amended Patents Act, 1970 the Contracting Party providing tion, the US and some other major does not include provisions for this. Due to the stipulation in Article 7, there was no question of any negoti- In order to legalise benefit sharing, sug gestions ha ve been ation in the Working Group. It is per- tinent to point out that such issues made by several countries that, as a means of benefit are within the domain of the nation- sharing, patent applicants be required to identify or al governments to implement rather than to be raised at the WTO forum. indicate in their applications the source of any genetic At the WTO forum, there is no easy material or traditional knowledge used in developing their finality on such issues. Again, this is an issue of serious concern for the claimed inventions developing countries and not for the developed countries. Developed countries are indifferent to these is- such resources”. It is also provided developed countries are against ben- sues as the issue of transfer of tech- in this Article that “each Contract- efit sharing. They disagree with the nology goes against their interest. ing Party shall take legislative, ad- suggestion to share commercial ben- ministrative or policy measures, as efits accruing from patented products. Conclusion appropriate, with the aim of sharing Instead, they are suggesting that the Almost all the TRIPS-related issues in a fair and equitable way the re- issue of benefit sharing should be set- of the Doha Work Programme are in sults of research and development tled at the time of approving the ac- limbo and the blame lies with the de- and the benefits arising from the cess to biodiversity material. veloping countries. Despite the reali- commercial and other utilization of sation that the TRIPS Agreement is genetic resources with the Contract- Trade and technology transfer likely to impact in several areas of de- ing Party providing such resources Paragraph 37 of the Doha Ministeri- velopment, developing countries are and thus sharing shall be upon mu- al Declaration deals with trade and not showing full interest in protect- tually agreed terms”. transfer of technology. The Declara- ing their concerns in the Council for The Indian Parliament in order tion stipulates that the Working TRIPS. If they want to protect their to legalise the application of the pro- Group under the auspices of the Gen- national interest, they must adopt visions of CBD enacted the Biologi- eral Council will examine the issues pro-active approaches to settle these cal Diversity Act, 2002. One of the relating to relationship between trade issues. Otherwise, with the passage major challenges for India is to adopt and transfer of technology and the of time, no decision would mean fait an instrument, which could help in steps that might be taken within the accompli on these issues. n realising the objectives of equitable framework of the WTO to increase sharing of benefits. Consequently, the flow of technology to developing The author is Convenor, National Section 21 of the Biological Diversity countries. The General Council was W orking Gr oup on Patent Law, and Act stipulates that “the National supposed to submit its report to the Trustee and Secr etar y General of Biodiversity Authority shall while fifth WTO Ministerial Conference on Centr e for S tudy of Global T rade granting approvals under the Act the progress in the negotiation. System & Development, India.

22 • Trade Insight • V ol.3, No.2, 2007 gender Genderissues Intellectual Property Rights and Gender The IP system must take into account the gender inequalities in the production and marketing of innovations, the other factors that affect the ways in which women adopt technologies and access markets as well as the gender-differentiated impacts of strict IP rules. n Bryn Gay and Yumiko Yamamoto arious forms of property are V needed for effective participa- tion in trade, and women usually begin from a disadvantaged position in this aspect, which frequently re- sults in unequal outcomes between the genders. The gendered impacts of intellectual property rights (IPRs) and women’s potential to benefit from them are emerging issues in the area of trade and gender, especially in the context of the World Trade Or- ganization’s (WTO) Agreement on Trade Related Aspects of Intellectu- al Property Rights (TRIPS). IPRs are a socially constructed system of reg- ulations that protects new ideas and technologies, and provides monetary kets. Commodifying this knowledge fordable drugs and health services incentives for inventors but it may transforms their cultural meanings will increase women’s burden to take have particular gendered effects. In- with implications for groups’ cultur- care of sick people at home. deed, IPRs are relevant to women al survival (Appadurai 1986). At the Third, when women’s ideas are and men from three perspectives. same time, women are unlikely to ob- patented, they are more likely to be First, women are the prominent tain economic gains, if strict IPR re- undervalued and pirated; benefits purveyors of plant genetic resourc- gimes reduce women’s ability to con- from IPRs are consequently unequal- es, traditional knowledge and cul- trol the propagation of seeds in crop ly shared. Historically, women’s in- tural folklore. Traditional knowledge production and of herbs in the pro- ventions were seen to be associated has often been passed down to wom- duction of traditional medicines. with their private, domestic sphere en through generations of matrilin- Second, the negative effects from roles, not as viable in larger markets. eal relations. Notions of communal- strict IPR regimes are likely to be When women’s inventions are only ly shared knowledge such as tradi- greater on women than men. In the seen as “domestic innovations” , tional medicinal plants and cultural case of medicines, strict IP rules may “commonplace”, “nurturing” and goods contrast with current intellec- pose additional challenges for ac- “non-scientific” , devaluing women’s tual property (IP) provisions under cessing affordable, life-saving med- potential to create further puts down TRIPS, which mostly value the com- icines, particularly for people living other women’s productive and repro- modification of ideas (Shiva 1997; in poverty – more so for women. The ductive work (Barwa and Rai 2002: Verzola 1999). Over the years, how- impoverishment of women’s health 44, 54). The following sections look at ever, traditional medicines have and economic status also has nega- the linkage s between IPRs and gen- gained economic value; handicrafts tive effects on children’s well-being; der in four areas: biodiversity, seeds made by indigenous women have it brings about a vicious, generation- and agricultural inputs; traditional become commercially viable and al cycle of poverty. Even if women medicinal knowledge; public health; popular in developed country mar- are not patients, lack of access to af- and cultural materials.

Vol.3, No.2, 2007 • Trade Insight • 23 gender issues

Biodiversity, seeds and home and in local hospitals but re- agricultural inputs By enhancing w omen’s cently, multinational corporations Many women and men in less devel- have targeted exports to Europe, Ja- oped countries earn their income in involvement in pan and North America. agriculture and medicinal plant cul- agricultural research and Linkages between international tivation. In these countries, women treaties such as TRIPS and micro- have been central to resource culti- in decisions on IP based poverty reduction pro- vation and allocation, while they ac- protection, women will grammes through small and medi- tively engage in food production. um enterprise development have They rely on freely sharing seeds, have greater control not been largely examined. Fur- agricultural technologies and fertil- over technological thermore, many countries’ legisla- isers to improve production. In ad- tion encourage access to plant re- dition to difficulties in accessing changes with greater sources for local producers but the land and credit, stringent IPRs could effective implementation of such pose challenges for women farmers. opportunities to laws has been difficult. Many women farmers opt to diversi- improve agricultural Notably, WTO Agreements such fy plants and livestock because they as TRIPS lack coherence with biodi- see that diversity improves the qual- productivity versity conventions. Particular mea- ity and sustainability of their subsis- sures to safeguard traditional medic- tence systems (Quiroz 1994; Menchú women will have greater control over inal knowledge of local producers, 1984). Women mostly avoid patent- technological changes with greater especially indigenous communities, ed seed varieties that male counter- opportunities to improve agricultur- from biopiracy 2 are necessary. Numer- parts advocate when producing al productivity. ous policy linkages require focused cash crops (Quiroz 1994). Moreover, Farmers’ rights movements, reli- attention and a gender perspective, any benefits derived from patented ant on women’s social networks, try which could consider: geographical plant varieties are less likely to be dis- to amend TRIPS provisions that indications (GIs), 3 special tariff struc- tributed equitably (Commission on mandate patents and plant variety tures for organic foods and herbs, the Intellectual Property Rights 2002; protection (PVP) 1 so that they rec- scope for regional collaboration to re- Wynberg 2004). ognise farmers’ rights to save, reuse, duce costs of exporting, sanitary and Patents on plant varieties could exchange and sell seeds (Doan phytosanitary standards, and/or na- increase the cost of essential seeds 2002; Borowiak 2004: 514-522). Suf- tional regulations for health prod- and impair seed sharing practices ficient consultation with women, in- ucts. The case of the Canadian gov- among farming communities. Pat- digenous communities and civil so- ernment, which has taken steps to ents on seeds could further hinder ciety must be facilitated while draft- protect traditional knowledge in oth- the distribution of food, with addi- ing IP provisions. In particular, it er areas and to regulate health prod- tional implications for people’s, par- must be ensured that IP rules do not ucts, could be examined as an exam- ticularly women’s, nutrition, health neglect the principles of access and ple for discussing the pros and cons and overall well-being. Technologi- benefit sharing and prior informed of such a policy. cal advances in the past century consent (PIC). Similarly, there yielded new research on ways to should also be a requirement for IPR TRIPS and gendered access to improve plant quality and produc- applicants to disclose the source of anti-retroviral drugs tion. Yet patents on these advances, origin of biological/genetic resourc- IP has drastic repercussions on peo- including genetically modified es and associated traditional knowl- ple’s access to inexpensive medi- plants, create financial obstacles for edge. These provisions are critical to cines, healthcare and technologies, farmers and raise concerns about the reward women for their contribu- with notable disparities between patenting of life forms. tions in agriculture and biodiversity women’s and men’s access. Strict Patents increase the cost of farm- conservation. IPR regimes have the potential to ing expenses, which may cut into make pharmaceutical drugs – nec- women farmers’ household expen- Traditional medicinal essary for sexual and reproductive ditures. The inability to purchase knowledge health and for widespread diseases time-saving technologies such as Production of traditional medicinal such as HIV/AIDS – expensive and herbicides increases the amount of and aromatic herbs as well as organ- inaccessible. The estimated number time women spend in controlling ic food and drinks is becoming a of women (aged 15 to 49) living with weeds and pests, and diminishes the niche for non-traditional agricultur- HIV/AIDS is less than that of men time spent in the private sphere (Tran- al exports. Throughout Asia and the in Asia-Pacific. However, the esti- Nguyen and Beviglia Zampetti (eds.) Pacific, such herbs are widely avail- mated number of women, who are 2004). By enhancing women’s in- able – and women are very much in- infected with HIV, has been increas- volvement in agricultural research volved as producers. Traditional ing at a faster rate than that of men. and in decisions on IP protection, medicines are used commonly at Thus, the gender gap of the HIV in-

24 • Trade Insight • V ol.3, No.2, 2007 gender issues fection rates is narrowing. able, life-saving medicines, Apart from biological rea- particularly for women in sons, women’s low socio-eco- poverty. Several studies nomic status in society, limit- (Oxaal 1998; Masud ed knowledge about their sex- Ahmed et al. 2005) show uality and obstructed access that a slight increase in to information increase their medical costs will prevent vulnerabilities to the epidem- people, especially women, ic compared to men (UNDP/ from seeing doctors and/or APMRN 2004: 14-15). Some taking drugs. Less devel- figures (World Bank 1997; oped countries’ public Tran-Nguyen and Beviglia health expenditures become Zampetti 2004: 264) estimate more strained when faced that 70 percent of infected with higher prices for life- women are 15-25 years old. saving medicines (UNAIDS Within this age set, increas- 2006: 13). Irregular health ing numbers of women are consultations in such coun- pregnant or raising children. tries also increase women’s Of the total number of peo- risk to becoming sick, and ple infected with HIV in 2005, in the worst case, women’s only about 20 percent received anti- women are frequently blamed for in- mortality rates. retroviral (ARV) therapy. Only 9 per- fections and risk domestic violence The increased domestic respon- cent of pregnant women have access and abandonment if they are found sibilities to take care of the sick re- to mother-to-child prevention servic- to be HIV-positive (Pradhan and duce women’s opportunities to par- es, indicating a grim future for stop- Sundar 2006: 27). Moreover, abused ticipate in income-generating activi- ping the spread of the disease (UN- women are reluctant to take HIV ties. Such responsibilities also cut AIDS 2006: 62). A number of social medicines on a consistent basis if their participation in leisure activi- and economic factors explain the ex- they are afraid of their partners, if they ties, or they simply have to work isting gender-related deprivation of are depressed, or if they are ashamed harder in both productive and repro- treatment for HIV/AIDS. of being abused (Lichtenstein 2006). 4 ductive spheres. First, given lower (or no) income Finally, women’s responsibilities in status than men and lack of access household chores and care work and IPR on cultural materials to property and land, women do not lack of support from families 5 gener- As the qualifications to meet TRIPS have much bargaining power with- ate added difficulties in seeking standards of originality and utility in the household to demand treat- healthcare. are constructed according to what ment or borrow money from hus- Strict IP rules may pose addition- will generate commercial profits, they bands or relatives to seek it. Even al challenges for accessing afford- are seen as contrary to how indige- when treatment is provided free of nous peoples and other communi- charge, women’s opportunity costs W hile man y w omen’s ties might view their knowledge. This and other costs, e.g., transportation process transforms cultural materi- costs to the nearest clinic, prevent and indigenous peoples’ als into cultural commodities, with them from seeking treatment (UN- exchange values that are dependent AIDS/UNFPA/UNIFEM 2004: 25). methods for keeping on how often outside parties use A survey in India found that as many cultural resources within them. Value is seen not as something as one-fourth of women have not with inherent worth but based on sought treatment due to financial their communities may utility and functionality (Rowlands constraints, while this percentage is be seen as obstacles to 2004: 212). Implications for trans- only 11 percent in men’s case forming sacred and historically sig- (Pradhan and Sundar 2006: 46). commercial nificant cultural materials into goods Second, the priority of medical development, these for consumption and export must be care tends to go to men, who are seen further investigated because this has as bread-winners, if treatment is communities are best dramatic consequences for the cul- not affordable for everyone in the suited for preserving tural survival of indigenous commu- household. nities. While many women’s and Third, social stigma, discrimina- cultural heritages and indigenous peoples’ methods for tion and the risk of violence associ- keeping cultural resources within ated with being HIV-positive impede the intellectual their communities may be seen as women from seeking treatment. Both commons obstacles to commercial develop- in the community and household, ment, these communities are best

Vol.3, No.2, 2007 • Trade Insight • 25 gender issues

suited for preserving cultural heri- well as the gender-differentiated im- South Institute. Ottawa: The North-South tages and the intellectual commons. pacts of strict IP rules. Much work Institute. Trends to digitise cultural mate- remains to be done to provide wom- Lichtenstein, Bronwen. 2006. “Domestic rials such as songs, folk legends, en with equal access to education V iolence in Barriers to Health Care for HIV- Positive Women.” In AIDS Patient Care and dances or designs have introduced and opportunities that enable them STDs 20 (2): 122-132. different opportunities to indige- to accumulate property, including IP, Masud Ahmed, Syed, Göran Tomson, Max nous peoples and communities in and other assets. n Petzold and Zarina Nahar Kabir. 2005. the global South. On the one hand, “Socioeconomic Status Overrides Age and IPRs on clothing, jewellery, pottery The authors are associated with Asia- Gender in Determining Health-Seeking or basketry may generate more in- Pacific T rade and Investment Behaviour in Rural Bangladesh.” In Bulletin of WHO, 83(2). come for groups wishing to market Initiative, UNDP Regional Centre in their cultural creativity. On the oth- Colombo, Sri Lanka. Menchú, Rigoberta. 1984. I, Rigoberta er, without ethical consultation, PIC, Menchu. London: Verso. participation in marketing of cultur- Oxaal, Zoe with Sarah Cook. 1998. “Health al materials, and sustainable bene- Notes and Poverty Gender Analysis.” Briefing for SIDA. Sussex: IDS BRIDGE, 13. fits from royalties, women purveyors of this cultural knowledge lose out 1 Article 27.3 (b) of TRIPS requires WTO Pradhan, Basanta K. and Ramamani Members to provide protection to plant Sundar. 2006. Gender Impact of HIV and significantly on IPR-related econom- varieties either through patents, or an AIDS in India . New Delhi: United Nations ic opportunities. effective sui generis system, or a Development Programme. Efforts to include and train wom- combination of both. See TRIPS Article Quiroz, Consuelo. 1994. “Biodiversity, en, particularly in indigenous com- 27.3, http://www.wto.org/english/ docs_e/legal_e/27-trips_04c_e.htm Indigenous Knowledge, Gender and munities, on IPR and non-IPR pro- Intellectual Property Rights.” In Indigenous 2 tection of cultural materials are es- Practice of appropriating a plant Knowledge and Development Monitor resource, obtaining a patent and not Vol.2. sential to securing control over their acknowledging or compensating the cultural and economic rights. It is original owner. Rowlands, Michael. 2004. “Cultural Rights and Wrongs: Uses of the Concept of also important to recognise a group’s 3 See TRIPS Article 22 and 23, http:// Property.” In Property in Question: Value rights over cultural materials and the w w w.wto.org/English/docs_e/legal_e/ Transformation in the Global Economy, decision not to use the IPR regime to 27-trips_04b_e.htm; Waglé (2007). ed. Katherine Verdery and Caroline protect them. Along these lines, en- 4 The study is based on the interviews Humphrey. New York: Berg. trepreneurs seeking to use women’s with women living with HIV in Alabama, Shiva, Vandana.1997. Biopiracy . Boston: or indigenous communities’ patterns United States of America. SouthendNOTES Press. 5 and designs must abstain from ap- For example, see Pradhan and Sundar Tran-Nguyen, Anh-Nga and Americo propriating their cultural knowledge. (2006) for the survey results in India. Beviglia Zampetti (eds.). 2004. Trade and To avoid theft, it is possible to store Gender: Opportunities and Challenges for information about various designs Developing Countries . New York and Geneva: United Nations Publications. and cultural outputs in public data- References bases or archives, as long as the peo- UNAIDS. 2006. Report on the Global AIDS Epidemic. Geneva: Joint United Nations ple within a culture group are trained A p p adurai, Arjun. 1986. “Introduction: Programme on HIV/AIDS. to monitor this process. The Mataat- Commodities and the Politics of Value.” In ua Declaration on Cultural and In- The Social Life of Things: Commodities in UNAIDS/ UNFPA/ UNIFEM. 2004. Women Cultural Perspective , ed. Arjun A p p adurai, and HIV/AIDS: Confronting the Crisis . tellectual Property Rights of Indige- 3-36. Cambridge: Cambridge University New York: United Nations Development nous Peoples, ratified by more than Press. Fund for Women. 150 indigenous groups, elaborates Barwa, Sharmishta and Shirin Rai. 2002. w w w.youandaids.org on this method of cultural protection. “The Political Economy of Intellectual To summarise, the latest IP sys- Property Right s: A Gender Perspective.” In V erzola, Jr ., Pio. 1999. Towards a People’s Alternative to “Intellectual Property Rights”. tem potentially binds common goods Development and the Challenge of Globalisation, ed. Peter Newell, Shirin M. Paper Presented at the National Institute of as private property and uncovers Rai and Andrew Scott, 41-56. London: Geological Sciences, in Quezon City, the costly litigation for handling dis- Intermediate Technology Development Philippines. putes, which could bring severe con- Group. Waglé, Swarnim. 2007. Geographical sequences to women with limited Borowiak, Craig. 2004. “Farmers’ Rights: Indications, TRIPS, and Promoting funds and negotiating power with- Intellectual Property Regimes and the Human Development in Asia. Colombo: S truggle over Seeds.” In Politics & UNDP RCC. in IP discussions. To become more Society. 32(4): 511-543. gender-sensitive, the IP system must World Bank. 1997. “Why Invest in Women’s Health and Nutrition?” Washington DC. take into account the gender inequal- Commission on Intellectual Property Rights. 2002. Integrating Intellectual Property Wynberg, Rachel. 2004. Rhetoric, Realism ities in the production and market- Right s and Development Policy. London: and Benefit-Sharing: Use of Traditional ing of innovations, the other factors CIPR. Knowledge of Hoodia Species in the that affect the ways in which wom- Doan, Darcie. 2002. “Plant Variety Development of an Appetite Suppressant. en adopt technologies and access Protection, Trade and Development.” Journal of World Intellectual Property markets (Barwa and Rai 2002) as Briefing Paper prepared for The North- 7(6): 851-876.

26 • Trade Insight • V ol.3, No.2, 2007 public health

TRIPS flexibilities and access to medicine

The case of some of the countries in Asia-Pacific indicate a positive shift in the willingness of their governments to use TRIPS flexibilities and ensure an appropriate balance between private rights and public interests.

n Cecilia Oh A fine balance

n 1997, 39 pharmaceutical compa- the governments to use patents or au- Inies filed a lawsuit against the gov- thorise a third party to use patents ernment of South Africa. The com- for virtually any public purpose, panies’ cause of action was that the without the need for negotiations or government’s amendment of its med- prior consent of the patent holder, icines law 1 to enable the parallel im- unlike in the case of compulsory li- portation of generic medicines was, cences by private entities. 2 TRIPS among others, in contravention of the permits a similar waiver of prior ne- World Trade Organization’s (WTO) gotiations with the patent holder in Agreement on Trade Related Aspects the case of a government use of a of Intellectual Property Rights patent for public, non-commercial (TRIPS) and a deprivation of their purposes (as opposed to private, constitutional right to intellectual lectual property protection in the in- commercial transactions). This waiv- property. terest of safeguarding public health. er allows for “fast tracking” a gov- The backlash of public opinion These developments appear to sig- ernment use authorisation as it forced the pharmaceutical industry nal a greater political willingness to avoids the delay that often occurs in to withdraw its legal action without take measures that more appropri- the negotiations, sometimes used as waiting for a decision on the validi- ately balance the interests, as be- a delaying strategy against compul- ty of its cause of action. Since then tween protecting intellectual proper- sory licensing. Government use au- however, the WTO Ministerial Dec- ty rights (IPRs) and ensuring ade- thorisations, thus, allow govern- laration on the TRIPS Agreement and quate access to medicines. ments to take speedy measures to Public Health in 2001 has confirmed ensure access to urgently needed that governments are within their Compulsory licences and medicines. rights to incorporate the so-called government use Malaysia was the first country in TRIPS flexibilities (which include In the context of access to medicines, Asia to grant a government use au- measures such as parallel importa- compulsory licensing permits a third thorisation in 2003. The government tion and compulsory licensing) into party to “use a patent”, by produc- relied on a provision in the patent their national laws and to use them ing or importing generic versions of law, which permits the relevant Min- in the public interest of promoting a patented product. A compulsory li- ister to authorise a government agen- access to affordable medicines for all. cence authorising the government it- cy or a third person to exploit a pat- The drug industry has since been self to use a patent is referred to as a entedNOTES invention in the case of, inter unwilling to engage in such high- government use authorisation. Pro- alia , a national emergency, or where publicity legal challenges but there visions for government use authori- the public interest so requires. 3 The remains persistent political and in- sation are a common feature in most government use authorisation per- dustry pressure on developing coun- patent regimes, and governments mitted public hospitals to dispense tries against their use of TRIPS flexi- typically have a large degree of free- the cheaper generic HIV/AIDS bilities. Despite such pressures, in dom to act when they use patents in drugs imported from India. The in- recent years, some Asia-Pacific coun- the public interest. For instance, the troduction of generic anti-retroviral tries have taken measures to limit the legislation of the United States (US) (ARV) reduced the monthly cost of private exclusive rights under intel- and the United Kingdom (UK) allow treatment – for both generic and orig-

Vol.3, No.2, 2007 • Trade Insight • 27 public health

inator products – by about 80 per- Thailand. Under threat from the US or parallel imports. The Doha Decla- cent of the 2001 prices. 4 to limit textile imports, the Thai gov- ration does not provide an exhaus- A year later, Indonesia also grant- ernment passed a law banning par- tive listing of the flexibilities permit- ed a government use authorisation. allel imports in 1992 (although par- ted to governments in formulating The Presidential Decree effecting the allel imports were allowed again af- their domestic intellectual property authorisation cited “the urgent need ter amendments to the patent law laws but Paragraph 4 of the Declara- of the community in the effort to con- which came into force in 1999). Again tion sets out the fundamental princi- trol HIV/AIDS epidemic” as the rea- in 1998, after a threat of high tariffs ple in this respect: not only can WTO son for the use of the patents related on imports of wood products and Members implement TRIPS in a man- to two HIV/AIDS drugs. The decree jewellery, the Thai government ner supportive of their rights to pro- authorised the relevant Minister to passed ministerial regulations to re- tect public health, they should do so. 10 appoint a “pharmaceutical factory strict the use of compulsory licens- One such flexibility relates to the as the patent exploiter for and on ing, which is permitted under the criteria for patentability. While the behalf of the Government” taking Thai law. 9 This time, however, the TRIPS Agreement stipulates that the into account the recommendations of threat of the loss of duty-free access criteria for patentability should be the National Drug and Food Control to the US market for a number of its defined as meeting the tests of “nov- Authority. A local generic producer exports from the Priority Watch List elty, inventive step, and industrial now manufactures generic versions has not worked to compel the Thai application”, it does not provide spe- of the first-line ARV treatment, at a government to cancel its government cific directions for how these criteria monthly cost of US$ 38, a significant use authorisations. are to be applied at the national lev- reduction from the price of US$ 800- el. In this way, countries retain the 1000 for the similar treatment com- TRIPS flexibilities – not only ability to interpret and apply the cri- prising patented products. 5 for emergencies or HIV/AIDS teria, as best suits the public interest More recently, in November 2006 Thailand also set a new precedent and objectives. and January 2007, Thailand issued in the use of TRIPS flexibilities, by This is the debate now taking government use authorisations for the granting an authorisation for a heart place in India . In 2005, India was local production and import of two disease drug. The government use obliged to bring its patent legislation AIDS drugs and a blood-thinning authorisation on the patent on clo- into conformity with TRIPS and treatment for heart disease. The phar- pidogrel, marketed under the brand hence, introduced the product patent maceutical industry initially sought name of Plavix (under patent held regime. Developing countries like to challenge the validity of these au- by Bristol-Myers-Squibb), marks a India, which did not provide patents thorisations on grounds that there departure from recent compulsory for pharmaceutical and agro-chemi- had been no prior consultation or ne- licences or government use authori- cal products at the time the TRIPS gotiation with the patent holders. A sations for AIDS treatments. Agreement came into force in 1995, reading of the Thai patent law sug- It is a common misperception that were allowed a 10-year transition pe- gests that prior negotiations are not the use of TRIPS flexibilities is only riod until 2005 to introduce such a required in the case of a public use of restricted to address public health system of protection. During this pe- patent rights, provided the patent emergencies and epidemics, and to riod, these countries were required holder was informed promptly, as was drugs to treat the three diseases spe- to accept patent applications (for done in the Thai case. 6 The US gov- cifically mentioned in the Doha Dec- pharmaceutical and agro-chemical ernment has not alleged a violation laration – HIV/AIDS, tuberculosis products) as of 1995 and to keep the of the TRIPS Agreement or the nation- and malaria. The Doha Declaration applications pending in a patent al law. The United States Trade Rep- does not restrict the use of TRIPS flex- “mailbox” until 2005. The Indian resentative (USTR), Susan C. Schwab, ibilities to specific diseases. In addi- mailbox was opened on 1 January stated that the US Administration tion, the Declaration explicitly con- 2005, after which Patent offices were “fully respected the Thai Govern- firms the right of countries to deter- required to examine the patent ap- ment’s ability to issue compulsory li- mine the grounds on which such li- plications, for the eventual granting cences” and “had not suggested that cences are granted. As non-commu- or rejection of the applications. Thailand has failed to comply with nicable diseases such as cancer, The new Indian patent law, in es- particular national or international heart disease and diabetes affect in- tablishing the product patent regime, rules”. 7 The Administration, howev- creasing numbers of people in the also incorporated a safeguard pro- er, placed Thailand on the Priority developing world, the high prices of vision 11 , which would reject product Watch List of the USTR’s Special 301 such treatments will raise similar is- patents for “mere” discoveries of a Report, citing “a weakening of respect sues of access and equity, as they did new form or a new use of already- for patents” and a “lack of transpar- for HIV/AIDS drugs. known drugs or modifications to ency and due process” in the grant of them unless the modifications make the compulsory licences. 8 Other TRIPS flexibilities the drugs significantly more effec- This is not the first time political The flexibilities in TRIPS are not re- tive. The provision, Section 3(d) of pressure has been brought to bear on stricted to just compulsory licensing the Patents (Amendment) Act, is

28 • Trade Insight • V ol.3, No.2, 2007 public health aimed at preventing “ever greening”, effect of persuading patent appli- 7 Letter to Congressman Sander M. Levin, whereby patent owners seek to cants to withdraw applications that dated 17 January 2007, in response to a letter from 22 Members of Congress, patent trivial modifications to al- will not pass the test of patentability requesting the Administration to clarify ready existing products in order to and do not justify patent protection. its position on the Thailand case. See extend their patent terms and block Document 11 in the compilation of document by Ministry of Public Health the entry of generics. Conclusion and the National Health Security Office, The Cancer Patients Aid Associ- The cases described above indicate Thailand (2007) ation relied on this provision in 2005 a positive shift in the willingness of 8 USTR Special 301 Report 2007, 30 April to file an opposition to Novartis’ some governments in Asia-Pacific to 2007 patent application for its anti-cancer use TRIPS flexibilities so as to en- 9 Medicins sans Frontieres (1999), in Oh, drug, Gleevec, on the ground that the sure an appropriate balance between C. (1999) application related only to a modifi- “private rights” and “public inter- 10 Paragraph 4 of the Doha Declaration cation that did not improve the effi- ests”. states: “We agree that the TRIPS cacy of the drug. In what many con- The current appeal by Novartis Agreement does not and should not prevent Members from taking measures sider a landmark decision, the Patent in India should be regarded as the to protect public health. Accordingly, … Office rejected the patent application “test case”, as to whether the bal- we af firm that the Agreement can and for Gleevec, on a number of grounds, ancing will eventually be achieved. should be interpreted and implemented including that claimed by the Can- The appeal by Novartis is not mere- in a manner supportive of WTO Member’s right to protect public health cer Association. Novartis’ appeal is ly against the rejection of its patent and, in p articular , to promote access to being heard in the courts now. 12 application. The challenge against medicines for all”. An opposition was also filed the validity of Section 3(d) on 11 Section 3(d) of the Patents (Amendment) against GlaxoSmithKline’s (GSK) grounds that the provision is not Act 2005 provides that the “mere patent application for Combivir, a TRIPS-compliant represents a chal- discovery of a new form of a known substance which does not result in the fixed-dose combination of two wide- lenge against the Indian govern- enhancement of the known efficacy or ly-used HIV/AIDS drugs (lamivu- ment’s interpretation of the TRIPS the mere discovery of any new dine and zidovudine). The patent Agreement, which take account of property or new use of a known application appears to claim an in- public health interests. The Doha substance or mere use of a known process…unless such known process vention on the combination drug, on Declaration’s exhortation to inter- results in a new product or employs at the basis that adding a “glidant” to pret and implement the TRIPS Agree- least one new reactant” will not be the two already known drugs con- ment in a manner supportive of pub- considered to be a patentable invention. stituted an invention. In the pharma- lic health may perhaps have been 12 At the time of writing this article, the ceutical industry, glidants are essen- forgotten. It also might be useful to appeal of Novartis was being heard in the Madras High Court in Chennai, India. tially common ingredients such as remind ourselves of the outcome of See the update about it in Box 1 of the silicon dioxide (or in common par- the case in 1997 in South Africa Cover Feature on page 16. lance, sand), corn starch, talc and when 39 companies sued the gov- calcium carbonate (or chalk) that ernment for incorporating a TRIPS drug manufacturers routinely use flexibility into its legislation. n References when making pills or tablets, to hold together pharmaceutical composi- Anderson, T. 2007. “Novartis Case Against The author is associated with Asia- India’s Patent Law Resumes This Week, tions. As such, neither the glidant Pacific T rade and Investment Intellectual Property Watch.” http:// nor the method of using the glidant Initiative, UNDP Regional Centre in w w w.ip-watch.org/weblog/ to combine the drugs is new. Hence, Colombo, Sri Lanka. index.php?p=657&res=1024 both fail to pass the test of patent- Khor, M. 2007. “Draf t Patent s, Compulsory ability as well as the criteria in Sec- Licence and Access to Medicines: Some tion 3(d). Ahead of a decision on the Notes Recent Experiences.” Third World Network (TWN). http://www.twnside.org.sg/title2/ patentability of the Combivir patent, parTRIPS.flexibilities.30jan07.with.cover.doc GSK in March 2006 announced the 1 Section 15C of the Medicines and Related Substances Control (Amend- Ministry of Public Health and National withdrawal of its patent application. ment) Act, 1997. Health Security Office. 2007. “Facts and The rejection of Novartis’ patent Evidences on the 10 Burning Issues 2 See 28 USC 1498 for US government related to the Government Use of Patents application has sent a signal that use provision and the UK Patent Act on Three Patented Essential Drugs in Section 3(d) will be used to ensure a 1977 on Crown use of a patent. Thailand.” Sangue Co. Ltd. clear consideration of public health 3 Section 84 of the Patent s Act in interests in the implementation of Malaysia. Musungu, S. and C. Oh. 2006. The Use of Flexibilities in TRIPS by Developing patent law. This has spurred other 4 See Musungu and Oh (2006), Khor Countries: Can They Promote Access to patent oppositions in India with ap- (2007). Medicines? Geneva: South Centre and proximately 180 patent oppositions 5 See Khor (2007). World Health Organisation. having been filed against patent ap- 6 See Section 51 of Thai Patent Act and Oh, C. 2000. TRIPS and pharmaceuticals: A plications for pharmaceutical prod- Ministry of Public Health and National case of corporate profits over public health. ucts at present. It also has had the Health Security Office (2007). Third World Resurgence Issue No.120/121.

Vol.3, No.2, 2007 • Trade Insight • 29 farmers’ rights

Protecting Farmers’ Rights in the Global IPR Regime Challenges and Options

Farmers’ rights are vital to food security and poverty eradication in the South and a key to maintaining global agro-biodiversity for future generations. But how can they be protected?

n Regine Andersen

enetic diversity of agricultural Genetic Resources for Food and Ag- der to enable them to continue as G plants is the very basis of farm- riculture (ITPGRFA) provides for the stewards and innovators of agro- ing. It provides the pool from which realisation of farmers’ rights. It does biodiversity. The idea is that the le- plant traits can be found that meet not define the concept but leaves it gal space required for farmers to con- the challenges of crop pests and dis- to Member governments to choose tinue this role must be upheld and eases, marginal soils, and – not least the measures they deem appropriate that farmers involved in the mainte- – of changing climate conditions, and – some measures are suggested in nance of agro-biodiversity – on be- it is a vital way of spreading risks for the Treaty – according to their needs half of our generation, for the benefit small-scale farmers. Plant genetic di- and priorities. Arriving at a clear and of all humankind – should be re- versity is probably more important fruitful understanding of the concept warded and supported for their con- for farming than any other environ- is the first challenge and fundamen- tributions. mental factor, simply because it is the tal to identifying further challenges If we take the measures suggest- factor that enables adaptation to and options. ed under the ITPGRFA for the reali- changing environmental conditions. The idea of farmers’ rights has sation of farmers’ rights as the point Thus, it is crucial to global food se- been intimately linked with the dis- of departure, the goals to pursue curity as well as to poverty eradica- cussion on intellectual property would be quite different for the two tion in the South. rights (IPRs) ever since the concept approaches (See the table on the next The world’s agro-biodiversity is was first voiced internationally. 3 page). 6 disappearing at an alarming rate. For Whereas there are many perceptions Proponents of the stewardship several major crops, upto 80–90 per regarding farmers’ rights today, they approach note that agricultural cent losses in variety over the past generally fall within one of two dif- plant varieties are normally shared century have been reported. 1 Since the ferent main approaches, which re- among farming communities: own- dawn of agriculture, farmers have late differently to IPRs. 4 ership of varieties is traditionally an been the custodians of agro-biodiver- alien idea among farmers and rep- sity. In developing countries, the vast The ownership approach resents a profound break with tra- majority of farmers still act as stew- This approach refers to the right of ditional perceptions. Furthermore, it ards and innovators of genetic diver- farmers to be rewarded for genetic would be difficult to identify exact- sity but the enormous transformations material obtained from their fields ly who should be rewarded. In ad- of agricultural systems worldwide are and used in commercial varieties dition, the demand for farmers’ va- increasingly threatening their liveli- and/or protected with IPRs. The rieties among commercial breeders hood options. Farmers’ rights are idea is that such a reward system is is limited, so relatively few farmers about enabling farmers to continue as necessary to enable equitable shar- would benefit, whereby most of the stewards and innovators of agro- ing of benefits arising from the use contributors to the global pool of ge- biodiversity, and about rewarding of agro-biodiversity and to establish netic resources would remain unre- them for their contribution to the glo- an incentive structure for continued warded. Also, the ownership ap- bal genetic pool. As such, farmers’ maintenance of this diversity. Access proach could lead to disincentives rights are vital to fight against pover- and benefit sharing (ABS) legislation to share seeds and propagating ma- ty. This article outlines central chal- and farmers’ IPRs are suggested as terial among farmers because of ben- lenges and options for the realisation central instruments. efit expectations, and/or because of of farmers’ rights. 2 exclusive IPRs for farmer s’ varieties. The stewardship approach 5 If countries choose to follow the Concept of Farmers’ Rights This approach refers to the rights ownership approach, it is thus vi- The International Treaty on Plant that farmers must be granted in or- tal that it does not conflict with the

30 • Trade Insight • V ol.3, No.2, 2007 farmers’ rights

Two Approaches for the Realisation of Farmers’ Rights

ITPGRFA Protection of farm- Equitable sharing of Participation in rele- Farmers’ customary measures ers’ traditional benefits arising from the vant decisions at the use of propagation knowledge use of genetic resources national level material (saving, sharing, selling)

Stewardship The goals are to Benefits are to be shared Participation is im- The goal is to uphold approach protect this knowl- between stewards of portant to ensure legal the legal space to edge against extinc- plant genetic resources space and rewards ensure farmers’ tion and thus to and society at large – for farmers’ contribu- continued mainte- encourage its further partly through the Multi- tions to the genetic nance of plant genetic use. lateral System. pool. resources.

Ownership The goals are to Benefits are to be shared Participation is im- The goal is to intro- approach protect the knowl- between purported portant to ensure ad- duce farmers’ IPRs edge against misap- “owners” and “buyers” equate legislation on along with breeders’ propriation and to of genetic resources ABS and IPRs. rights – in balance. enable its holders to upon prior informed decide over its use. consent on mutually agreed terms. overall objective of stewardship, • upholding and developing a rieties of Plants (UPOV), the World which has been the prevailing prin- legal space 8 for farmers’ custom- Trade Organization’s (WTO) Agree- ciple in the Food and Agriculture ary practices related to agro- ment on Trade Related Aspects of In- Organisation (FAO) ever since the biodiversity; tellectual Property Rights (TRIPS) discussion came up. • creating support mechanisms for and the World Intellectual Property Based on the many perceptions farmers’ contributions to the Organisation (WIPO). Also, region- on the concept, the following work- global pool of genetic resourc- al and bilateral trade agreements of- ing definition may be seen as a low- es; and ten set the introduction of plant est common denominator: 7 • enabling farmers’ participation breeders’ rights as a condition. IPR Farmers’ rights consist of the cus- in relevant decision-making regimes are evolving extremely fast tomary rights that farmers have had processes. in many developing countries, in- as stewards and innovators of agro- creasingly restricting farmers’ legal biodiversity since the dawn of agri- We will focus on the first two in space. The problem is that the IPR culture to save, grow, share, devel- this article. regimes in these countries never had op and maintain plant varieties; and the chance to adapt to a slowly de- of their legitimate rights to be re- Upholding legal space veloping seed sector, as in the North. warded and supported for their con- Farmers’ practice of saving, using, This makes it extremely difficult to tribution to the global pool of genet- exchanging and selling seeds and establish “prior art” – formal knowl- ic resources as well as to the devel- propagating materials from their edge of already existing plant variet- opment of commercial varieties of own harvest is increasingly affected ies – which is necessary to establish plants, and to participate in deci- by three forms of legislation: IPRs, whether a new variety, subject to sion-making on issues that may af- particularly plant breeders’ rights; plant breeders’ right, is really new. fect these rights. seed laws; and ABS laws. 9 Normally the burden of proof lies Such a “minimum definition” Plant breeders’ rights restrict the with the farmers. does not directly address the latent use of farm-saved seeds and the ex- Seed laws cover exchange and conflict between farmers’ rights and change of seeds and propagating sales of seeds and propagating ma- IPRs. Rather, it seeks to establish a materials from plants protected with terials – regardless of whether they common ground from which to ad- such rights. The extent to which they are protected with IPRs – for plant dress the crucial issue of farmers’ restrict such practices depends on health reasons. Their certification rights, which is necessary to devel- the coverage of the rights and possi- rules are normally based on criteria op a fruitful dialogue among stake- ble exemptions for small-scale farm- relevant to genetically homogeneous holders on necessary measures to be ers. The past 40 years have seen a plant varieties from professional taken – also with regard to IPRs. steady increase in restricting these plant breeders, but not farmers’ vari- Based on this definition, we can de- rights through the International eties. The result is that farmers’ vari- rive three core challenges: Union for the Protection of New Va- eties are excluded from the formal

Vol.3, No.2, 2007 • Trade Insight • 31 farmers’ rights

market in many countries – in Eu- vant decisionmaking processes. Cen- rope, it is even prohibited to ex- tral options pertain to creating a le- change seeds among farmers or to gal space within legislative frame- give them away. works for farmers’ stewardship and ABS laws, often adopted with innovations in agriculture, and to es- reference to the Convention on Bio- tablish funding mechanisms at the logical Diversity (CBD), tend to re- international and national levels in strict access to genetic resources for order to scale up activities support- companies and entities other than ing them in their vital contribution farmers and indigenous peoples. to the global genetic pool. n However, in some cases, the acts also to agro-biodiversity. 11 By contrast, cover gene bank conservation activi- there are many examples of indirect The author is Senior Resear ch Fellow, ties, vital for farmers’ continued ac- benefit sharing, normally non-mon- Fridtjof Nansen Institute, Nor way . cess to agro-biodiversity. In Peru, for etary. The most frequent are: example, access-related legislation on the protection of traditional • access to seeds and propagat- Notes knowledge has proven a barrier to ing materials, and related infor- conservation and has discouraged mation; 1 FAO, S tate of the World’ s Plant Genetic the sharing of seed potatoes among • participation in the definition Resources for Food and Agriculture farmers in some areas. (Rome: Food and Agriculture Organisa- of breeding goals; tion, 1998). From a farmers’ rights perspec- • participatory plant breeding in 2 tive, the main goal must be to uphold collaboration between farmers The article is based on findings from an international research project on the legal space for farmers within and scientists; Farmers’ Right s led by the author. these emerging legislative frame- • strengthening farmers’ seed Publications from the project can be works. As a minimum, it must, as a systems; downloaded free of charge from w w w.fni.no/farmers/main.html. general principle, allow farmers to • conservation activities, includ- save, develop, exchange and sell ing local gene banks; and 3 Regine Andersen, “The History of seeds and propagating materials • enhanced utilisation of farm- Farmers’ Right s – A Guide to Central 10 Documents and Literature,” FNI Report 8/ from their varieties with other farm- ers’ varieties, including market 2005 (Lysaker: The Fridtjof Nansen ers. Plant health concerns must be access. Institute, 2005a). addressed in other ways. Further- 4 This is based on Regine Andersen, more, IPR legislation must be de- Today, these benefits reach only “Result s from and International Stake- signed so as to enable small-scale a limited number of farmers. Options holder Survey on Farmers’ Rights,” FNI farmers to continue their customary Report 9/2005 (Lysaker: The Fridtjof to scale them up include the estab- Nansen Institute, 2005b). practices related to seeds and prop- lishment of funds or facilitating 5 agating materials. Finally, ABS leg- mechanisms at the international and In this context, the term ‘stewardship’ is used in recognition of farmers’ role in islation must not impose barriers to national levels to channel the neces- maintenance and innovative develop- conservation activities, or serve to sary resources to activities support- ment of genetic resources. discourage seed exchange among ing farmers in their maintenance of 6 From Regine Andersen, “Realising farmers. agro-biodiversity. This would also Farmers’ Rights under the International require up-scaling institutional Treaty on Plant Genetic Resources for Creating support mechanisms structures and competence for these Food and Agriculture, Summary of Findings from the Farmers’ Rights Creating effective support mecha- purposes – in close collaboration Project ( Phase 1),” FNI Report 11/2006 nisms is related to the equitable shar- with farmers. (Lysaker: The Fridtjof Nansen Institute, ing of benefits from the use of genetic 2006). resources. We can distinguish be- Conclusion 7 Ibid. tween direct and indirect, as well as Raising awareness about the impor- 8 This concept was first used in this monetary and non-monetary, bene- tance of protecting farmers’ rights for context in Andersen (2006). fit sharing. Direct benefit sharing food security and poverty eradication 9 This development can be seen as the takes place between purported is the most pressing challenge today. result of the interaction between the “owners” and “buyers”, whereas in- A minimum definition, as proposed international regimes presented here, direct benefit sharing is between the in this article, may be instrumental and their driving forces, as analysed in Regine Andersen, Governing Agrobiodi- stewards of agro-biodiversity and in furthering dialogue between stake- versity: Plant Genetics and Developing society at large, often channelled holders on measures to be taken. Core Countries (Aldershot: Ashgate, through development cooperation. challenges are the increasing legal forthcoming 2007). Although several countries in the restrictions on farmers’ customary 10 This concept broadly covers traditional South have enacted legislation on practices related to agro-biodiversi- varieties and farmers’ plant variety direct benefit sharing, no instances ty, and the lack of support structures innovations. have been reported so far with regard and farmers’ participation in rele- 11 Andersen (2005b).

32 • Trade Insight • V ol.3, No.2, 2007 IPR dispute

of IPRs, enabling both right holders Protection and enforcement of of IPRs and those challenged in such processes, to protect their legitimate interests through civil or administra- Intellectual Property tive proceedings. During the Uru- guay Round of trade negotiations, developing countries put up a fierce fight to block provisions in TRIPS that would require either a WTO Member to establish special courts for IPRs or to specially allocate re- Rights sources for effective IPR enforcement. More specifically, Article 1.1 of TRIPS states that “Members shall be free to Yet another example of do as I say and not as I do? determine the appropriate method of implementing the provisions of the TRIPS Agreement within their own n Hannah Irfan and Shandana Gulzar Khan legal system and practice”.

he concerns of the United lowed closely by the bulk of devel- The present debate States (US) over China’s poor oping Members of the WTO, and al- According to the USTR, the Chinese T intellectual property right though no Member participated as a regime for IPRs fails to implement the (IPR) protection and enforcement third party in the consultative stage TRIPS as per China’s commitments had been brewing for a while, giving of the dispute, the option to join the at the WTO contained in its protocol rise to speculations as to whether or proceedings at the Panel stage re- of accession. It alleges: when the US would take the matter mains available. The matter raised up before the Dispute Settlement by the US, i.e., the scope of a Mem- • That the quantitative threshold Body (DSB) of the World Trade Or- ber’s commitment in effective protec- which must be met by IPR hold- ganization (WTO). When lobbyists tion and enforcement of IPRs under ers in order to initiate criminal representing three US business gi- TRIPS, is one that remains unre- prosecutions of IPR infringe- ants - Walt Disney, Microsoft and solved and a contentious issue. Two ment is so high that it effective- Vivendi - stated that Chinese copy- separate fora, the DSB and the Coun- ly allows large scale piracy and ing of movies, music and software cil for TRIPS, have seen the devel- counterfeiting to pass un- cost them nearly US$ 2.2 billion in oped and developing world occu- checked. 2006 sales losses, the US came into pied with the spicy issue of TRIPS • That the Chinese regime for dis- action. enforcement since the inception of the posal of counterfeit goods effec- In April of this year, the United WTO. tively allows sale of these goods States Trade Representative (USTR) in markets. requested the WTO DSB for consul- TRIPS enforcement provisions • That China denies copyright tations under Article 4.4 of the Dis- TRIPS (Articles 41-61) imposes min- protection to imported works pute Settlement Understanding imum standards for the enforcement awaiting censorship review, (DSU) with China on two cases, one of which deals with the Agreement on Trade Related Aspects of Intellec- tual Property Rights (TRIPS). Consultations were held in Gene- va on 7 and 8 June but the two sides were not able to resolve the matter. As a result, the office of the USTR re- quested the DSB on 13 August to es- tablish a panel to rule upon the mer- its of the case. As is the norm, China blocked the establishment of a Panel in a meeting of the DSB but the Panel was automatically established at the next meeting of the DSB on 25 Sep- tember following a second request by the US. The dispute is expected to be fol-

Vol.3, No.2, 2007 • Trade Insight • 33 IPR dispute

thus allowing for piracy to administrations towards a higher terfeiting worldwide”. While the EC take place during the waiting level of intellectual property enforce- recognised that Members are al- period. ment, suggesting best practices, etc.) lowed to implement suitable enforce- • That Chinese law, in certain to ensure a full implementation of ment provisions domestically, it felt cases, does not prosecute unau- TRIPS obligations in this field.” that “such measures must ultimate- thorised reproduction of copy- One of the reasons put forward ly help to achieve the objectives of righted works unless reproduc- by the developing Members for reject- the TRIPS Agreement”. tion is accompanied by unau- ing this proposal of the EC was the However, verbal jostling be- thorised distribution. lack of mandate for such monitoring, tween the developed and develop- under Article 68 of TRIPS, by the ing Members led some developing According to statements issued Council for TRIPS. Members to state that this issue by the Chinese government, “Mea- Ironically, calls by a large group would face blocking from the agen- sures challenged by the US are fully of developing countries for recogni- da if those Members that requested consistent with the TRIPS Agree- tion of biopiracy and other IPR in- it each time were aiming for more ment and should bear no blame.” fringement by large western phar- than unilateral sharing of best prac- Moreover, “China strongly oppos- maceutical companies in their na- tices. Referring to Article 1.1 of es any attempt by any other WTO tional jurisdictions have fallen on TRIPS, the developing world ar- Member to impose additional obli- deaf ears (this situation persists gued that discussing enforcement gations beyond the TRIPS Agree- even today vis-a-vis the “TRIPS-CBD in the Council for TRIPS would ment through inappropriate appli- discussion” in the Council for mean restraining countries’ flexi- cation of the WTO dispute settle- TRIPS and the Doha Round of trade bility to draft domestic legislation ment mechanism, and believes that negotiations). on this issue. Moreover, the devel- the impact resulted therefrom This issue has stayed on the agen- oping Members found it amusing would by no means be accepted by da ever since. At the Council for that a number of issues pertaining other developing Members”. TRIPS meeting during 25 -26 Octo- to IPRs and of concern to them were ber 2006, in a paper submitted joint- met with a less than enthusiastic Negotiations on enforcement ly with the US, Switzerland and Ja- response from most developed and implications for developing pan, the EC highlighted “the need Members. world for intervention from the TRIPS The calls for recognition of com- China’s reference to the lack of ac- Council to assist efforts to curb the munity IPRs were brushed aside as ceptance of the concept of such ad- rapid increase in piracy and coun- “not a part of the Doha mandate” by ditional obligations by other devel- a majority of the developed Members oping Members is a strong hint at the and the need for effective enforce- kind of vigour that China intends to The calls for recognition ment of TRIPS provisions that made display during its defence of its re- it obligatory for national govern- gime of laws on IPR enforcement. of community IPRs ments to question their businesses on Moreover, the said reference to “ad- were br ushed aside b y a how they were transferring technol- ditional obligations” is the crux of ogy were not even an issue that con- the matter both in this dispute and majority of the cerned the developed Members. the Council for TRIPS. developed Members and Thus, developing Members saw no Two years earlier, at the Council reason to add to their already bur- for TRIPS meeting held during 14- the need for effective dened resources and share the lop- 15 June 2005, a submission from the sided view of IPR recognition, pro- European Community (EC), which enforcement of TRIPS tection and enforcement of their had the support of most of the devel- provisions that made it counterparts from the developed oped Members, drew fire from the de- world. veloping world. According to its pro- ob ligatory for national posal, the EC suggested that the governments to Disputes on enforcement Council for TRIPS be authorised, pur- The China-US IPR dispute will be suant to Article 68 of TRIPS, to mon- question their businesses the first one of its kind, as it makes it itor Members’ compliance with the on how they were to the Panel stage, since the incep- enforcement provisions of the Agree- tion of the WTO in 1995. Three re- ment. This would include assessing transferring tec hnolo gy quests for consultations have been “the implementation of TRIPS’ pro- made under the enforcement provi- visions on enforcement in detail, and were not even an issue sions of TRIPS, all initiated by the make recommendations on ways to that concerned the US, all against various Member improve the situation (for instance, States of the EC, and all disputes re- by laying down benchmarks to eval- developed Members sulted in notification of mutually uate the progress made by national agreed solutions (MAS) before the

34 • Trade Insight • V ol.3, No.2, 2007 IPRglobalisation dispute matter went to the Panel stage. The common thread between the In the disputes “Denmark – mea- three consultations and the result- sures affecting the enforcement of The trend of mutual ant MAS was that they were be- intellectual property rights” (1997) agreement and tween developed Members (the US and “Sweden – measures affecting and the EC Member States), where the enforcement of intellectual prop- immediate rectification the respondent Members had to erty rights”(1997), the issues were in future disputes change the laws and remedies avail- nearly identical, i.e., to make avail- able within a short period of time able prompt and effective provision- arising with respect to and the respondents belonged to a al measures for infringement of IPRs IPR enforcement in customs union, the EC, which in civil proceedings in Danish and helped them in bringing about the Swedish courts respectively. The developing or required legislative and administra- Swedish MAS was reached in 1998 tive changes. whereas the Danish one in June 2001. least developed This trend of mutual agreement In order to be fully TRIPS-compli- countries seems highly and immediate rectification in future ant, the Parliament of Sweden disputes arising with respect to IPR passed legislation on 25 Novem- unlikely enforcement in developing or least ber 1998 amending Sweden’s Copy- developed countries seems highly right Act, Trademarks Act, Patents unlikely. However, one thing is cer- Act, Design Protection Act, Trade objects, documents, information in tain: IPR lobbies in developed coun- Names Act, Act on Protection of Semi- computer systems or anything else tries are picking up and not lessen- conductor Products and Plant Breed- which are comprised by the petition ing their drive to protect their IPRs ers Protection Act. This led to grant- for investigation”. regardless of the capacity of the ing judicial bodies in Sweden the In the consultations “Greece – Member(s), which are allegedly lack- authority to order provisional mea- enforcement of intellectual property ing enforcement mechanisms. sures in the context of civil proceed- rights for motion pictures and televi- ings involving IPRs. Specifically, the sion programs”, the US alleged that What next? legislation provided that “if there is a “significant number of television The China-US IPR dispute is likely reason to believe that a person has stations in Greece regularly broad- to be a turning point on ascertain- taken or is about to take action to in- cast copyrighted motion pictures ing the exact scope of the TRIPS fringe intellectual property rights, and television programs without the Agreement (Article 1.1) and for test- the court may order a search for in- authorization of copyright owners. ing the limits of its implementation fringing materials, documents or Effective remedies against copyright and enforcement provisions (Arti- other relevant evidence. The search infringement were not provided or cles 41-61). However, whether the may be ordered inaudita altera parte if enforced in Greece with respect to dispute lives up to these expecta- there is a risk that materials or docu- these unauthorized broadcasts. This tions will also depend on how the ments could be removed, destroyed situation appears to be inconsistent Panel and the AB view their own or altered”. The legislation came into with the obligations of Members un- role under Article 3.2 of the DSU and effect on 1 January 1999. der Articles 41 and 61 of the TRIPS their use of “judicial economy” in In the Danish case, the Danish Agreement”. perhaps avoiding a substantive rul- Parliament on 20 March 2001 passed On 20 March 2001, the parties to ing on this sensitive yet important amendments to the Administration the consultations notified an MAS issue. At the very least, what is of Justice Act granting the relevant concerning the obligations of the EC hoped for is that the dispute throws judicial authorities in Denmark the and Greece under TRIPS to ensure some light on the issues currently authority to order provisional mea- that the enforcement system in Greece under hot debate at the Council for sures in the context of civil proceed- permits effective action against copy- TRIPS, and provides impetus to the ings involving the enforcement of right infringement by television sta- entire Membership for attaining a IPRs. Specifically, the amendments tions and constitutes a deterrent to more just and balanced negotiations provide that the “judicial authorities further infringements. This MAS also agenda that ensures an equitable may decide that an investigation at entailed legislation by the Greek au- and full implementation of TRIPS’ the place of the defendant shall be thorities, which provided addition- obligations by all Members. n carried out in order to secure evi- al enforcement remedies for copy- dence of an infringement of intellec- right holders whose works were in- Hannah Irfan is a T rade Lawyer tual property rights, and that such fringed by television stations oper- based in Lahore, Pakistan. Shandana an investigation may be conducted ating in Greece, for the immediate Gulzar Khan is a Trade Lawyer based without prior notification of the de- closure of television stations that in- in Geneva, Switzerland. Both are fendant if it is assumed that the noti- fringe IPR and an undertaking to members of the Asian Institute of fication would cause a risk of remov- continue to improve the effective en- Trade and Development, Islamabad, al, destruction or modifications of forcement of IPRs. Pakistan.

Vol.3, No.2, 2007 • Trade Insight • 35 legal issues The Nexus Between Indian Laws and International IPR Conventions

Effective protection and management of intellectual property rights such as patents, trademarks, industrial designs and copyright are becoming increasingly essential to the survival and vitality of businesses worldwide.

n Hemant Batra and Ambalika Banerjee

n endowment comprises an as- A sortment of attributes such as manners, ingenuity, presentation, or any other potential of valuable hu- man endeavour. Intellectual proper- ty (IP) plays a crucial role in every area built and groomed by human beings. Today, owning basic capital or labour does not suffice for the vic- tory or success of a country. Inge- nious innovation marks a country’s development, be it economic, social, political or legal. How a country is able to tap its intellectual wealth and make use of it is the determining fac- tor for development. The IP structure is a vibrant tool for creating wealth, also inducing enterprises and indi- viduals to innovate. It is also a lush setting for the development of and opment. There is evident global in- to the copyright law, which came trade in intellectual assets and it aids ter-dependency for establishing trade into force in May 1995, has ushered in the creation of a stable environ- links and creating a strong web of in comprehensive changes and ment for domestic and foreign invest- global integration. brought the copyright law in line ment. Thus, a country’s growth de- While protecting its IP goodwill, with the developments in satellite pends on industrial, technological India has, time and again, brought broadcasting, computer software and pharmaceutical development itself in tune with the various inter- and digital technology. and those responsible for this whirl- national IP conventions, creating an The amended law has made pro- pool are researchers and inventors. encouraging environment for other visions, for the first time, to protect The establishment of the World countries to trade with and invest in performers’ rights as envisaged in Intellectual Property Organisation India. the Rome Convention. The Indian (WIPO) and the World Trade Orga- Copyright Act today is compliant nization (WTO) has brought about a Copyrights with most international conventions major transformation in global trade India’s copyright law is held in the and treaties in the field of copy- in the 21 st century. In particular, the Indian Copyright Act, 1957. The rights. India is a Member of WIPO, WTO is bringing about changes in copyright law has been amended pe- the Berne Convention of 1886 (as both the constitution and convolu- riodically to keep pace with chang- modified at Paris in 1971), the Uni- tion of international trade and devel- ing requirements. The amendment versal Copyright Convention (UCC)

36 • Trade Insight • V ol.3, No.2, 2007 legal issues of 1951 and the WTO. Though India ing to invest more than before due to is not a Member of the Rome Con- T hough the P atents an assurance of IP safety through re- vention of 1961, the copyright law is vised legal regimes. fully compliant with the Rome Con- Act, 2005 brought For instance, though the Patents vention provisions. Act, 2005 brought about quite an up- Copyright laws operate territori- about quite an upheaval heaval and was not welcomed at all, ally. They generally provide protec- and was not welcomed it has worked out for the best as the tion only for a country’s nationals or country’s R&D units have been de- for works first published in the coun- at all by a number of veloped for better innovations in the try. Generally, treaties or bilateral stakeholder groups in field of medicine. Initially, the Indian agreements address the availability market was able to provide similar but of protection for foreign authors and India, it has worked out much cheaper generic versions of life- grant the same protection to them as for the best as the saving drugs. Though the copycat they do to nationals under “reciproc- business actually facilitated a few to ity” conditions. countr y’s resear ch and burgeon into global players and made medications cheaper, pharma- Universal Copyright Convention development units have ceutical multinational companies UCC was adopted in 1952 and is been developed for (MNCs) were forced to witness a re- administered by the United Nations duction in their market share due to Educational, Scientific and Cultural better innovations in Indian companies. Organisation (UNESCO). Altogeth- the field of medicine Now, both the domestic compa- er, 92 countries, including India, are nies and MNCs see the new environ- Members of this convention. Under ment with cautious optimism. This the convention, each Member State union that is open to all countries has resulted in the coming of many grants the same protection to pub- of the world, provided that certain new firms to India and thus a boom lished and unpublished works by minimum protective requirements in trade. India has introduced a new nationals of all Member States and are met. These requirements include product patents regime, covering to works first published in any other national treatment, granting of cer- drugs, foods and chemicals. This is Member State as granted by Member tain moral rights to authors with re- in compliance with the WTO’s States to their nationals for works gard to the exploitation of their Agreement on Trade Related Aspects first published in their territories or works and certain economic rights, of Intellectual Property Rights unpublished works created within and adoption of certain minimum (TRIPS). their territories. Thus, softwares cre- terms of protection for various Strong patent law is expected to ated by Indian authors or first pub- works. The Berne Convention also encourage foreign investment in lished in India are protected in all provides copyright protection with- R&D projects and consequently ben- Member States to the same extent that out requiring any formalities. efit the Indian economy. Thus, it can India’s current copyright status pro- be seen that strong IP protection is tects software. Patents essential to the success, and in some This provision applies only to Patents benefit none other than the instances, to the survival of the bio- works that were first published out- owners of IP and add value to all in- technology companies in this coun- side the country requiring the obser- dustrial as well as business con- try. For such companies, the patent vance of the formalities, and were cerns and laboratory discoveries and system serves to encourage develop- not authored by one of that coun- in doing so, provide incentives for ment of new medicines and diagnos- try’s nationals. Also formalities private sector investment and devel- tics for treatment and monitoring in- such as registration are required opment. Anyone in the above busi- tractable diseases, and agricultural under UCC in order to avoid an ness should have an independent products to meet global needs. infringement suit. research and development (R&D) centre. Trademarks Berne Convention India, after much ado over a peri- India’s Trademarks Act, 1999 has af- The Berne Convention was estab- od of 10 years, was able to scratch filiations with and derivations from lished in 1886 in Berne, Switzerland, out its old Patent law, amending it to TRIPS and meets the requirements of in order to protect international copy- cover product patents too. This revo- the WTO. Till date, India is not a right through mutual cooperation. lution in 2005, which was a conse- Member of the International Conven- WIPO administers the convention quence of its WTO membership, tion on Trademarks, namely the and 105 countries are its Members. helped the country to come on a par Madrid Protocol. Hence, if a foreign The Berne Convention contains with its international competitors. It company is desirous of establishing a more far-reaching regulation of has also opened gates for higher an office in India or wants to set up copyright than does UCC. Members trade and investment in the country business in India, it must undergo of the Berne Convention constitute a as foreign companies are now will- the country’s trademarks registration

Vol.3, No.2, 2007 • Trade Insight • 37 booklegal review issues

formalities and register in India sep- scape. In this vibrant environment, arately, even if it is registered in its Intellectual property Indian companies have grown rap- own country. idly, leveraging the availability of a A good image and goodwill pro- management has large pool of highly skilled scientif- vide a company with a competitive emerged as one of the ic, technical and managerial human edge. With Indian companies con- resource to provide high quality tending for a place in the global major areas of products and services worldwide. markets, their trademarks will re- business competence This has been made possible, inter quire protection at the internation- alia , due to the evolution of laws, al level as well and policymakers and there is an which give effective protection to IP. have responded to the beckoning of urgent need for it To sustain growth, profit and the Madrid Protocol. The Madrid market share, and to move up the Agreement concerning the interna- to be made an value chain, companies need to tional registration of trademarks emerge as technology leaders by ag- became effective on 13 July 1892 integral part of gressively deploying resources in and is a special arrangement with- cor por ate strategy R&D and product and process in- in the scope of Article 19 of the Par- novation. The innovative ideas and is Convention and only countries products emerging from the R&D parties to the convention may join and expense, produced in part by laboratories need to be effectively the Agreement. the necessity of retaining local protected and converted into valu- After over 100 years, there are trademark counsel or agents in each able IP assets, in order that they more than 75 countries, which are country, legalisation of documents translate into revenues and profit signatories to the Agreement or the in many countries through a bur- for the business. Protocol. However, India is not a sig- densome multi-step process and Constantly evolving national, re- natory to either. translation of documents into mul- gional and international IP regimes The Madrid system disengages tiple languages. impact businesses and create new a device whereby a trademark own- The Madrid system provides for opportunities as well as challenges er may obtain an international reg- lots of advantages with respect to for them. Effective protection and istration of trademark from WIPO. fees. For example, the applicants for management of IP rights (patents, This would catapult trade as a com- international registration of a trade- trademarks, industrial designs and pany would no longer have to keep mark are required to pay fee only copyrights) are becoming increasing- getting its trademarks or services once in local currency. The payment ly essential to the survival and vital- marks registered in different coun- of a single filing fee and prepara- ity of businesses worldwide. IP man- tries, which is cumbersome. The bar- tion of a single application result agement has emerged as a major area riers to trade with respect to IP would in savings in legal service fees. This of business competence, and there is be reduced to a large extent. The pri- provision is a major attraction of an urgent need for it to be made an mary advantage of the Madrid sys- adherence to the Protocol. More- integral part of corporate strategy. It tem is that it allows a trademark over, the fees associated with filing has become as important and rele- owner to obtain a trademark protec- through the Madrid system are gen- vant to the overall management of tion in any or all Member States by erally lower than the fees involved businesses worldwide as other as- filing one application in one juris- in national filings. It is, therefore, pects of management like technolo- diction with one set of fees, and expected that India’s accession to gy, marketing, finance, corporate make any changes and renew regis- the Madrid system will open the governance, and industrial econom- tration across all applicable jurisdic- flood gates to business, commerce ics and strategy. n tions through a single administra- and trade. tive process. Hemant Batra is the Vice Pr esident of Currently, in order to obtain Conclusion South Asian Association for Regional Cooperation in Law (SAARCLAW). trademark protection in foreign IP is an invaluable asset germinating He is the Senior Partner of Kaden countries, the Indian applicants are from human ingenuity. In the long Boriss – Corporate & Commercial run, it is the quality of the IP created, required to file a separate trade- Lawyers and the Director of Kaden mark application in each individu- over and above all the tangible invest- Boriss Consulting Pvt. Ltd. He is also al foreign country of interest for each ments or assets in a business, that the Director of two UK companies, mark. Since many companies in In- determines the success of the busi- Thames Tobacco Ltd. and Kaden dia are vying to take the global po- ness or trade, in terms of profitabili- Boriss UK Ltd. dium and reap the benefits of glo- ty, growth and brand equity. balisation, this is a very important Globalisation, deregulation and Ambalika Banerjee is a Coordinator feature. Administering such large advances in information and com- of SAARCLAW and a lawyer with international portfolios involves munication technologies have radi- Kaden Boriss-Corporate & considerable administrative effort cally altered the economic land- Commercial Lawyers.

38 • Trade Insight • V ol.3, No.2, 2007 activities Trade Policy and Farmers’ Rights

Future of Trade Policy in South Asia IPRs and Farmers’ Rights SAWTEE organised the two-day regional seminar ti- SAWTEE, its partners and Local Initiatives for Biodiver- tled Future of Trade Policy in South Asia during 30-31 sity Research and Development (LIBIRD) organised the August 2007 in Nepal. The seminar, attended by about international seminar titled Farmers’ Rights in the Con- 50 participants from Bangladesh, Pakistan, India, text of Global Regime on Intellectual Property Rights during Nepal and Sri Lanka, provided a platform to stake- 28-29 August 2007 in Nepal. The seminar’s six sessions holders, including civil society representatives, the were: “Farmers’ Rights and IPRs: Conceptual Issues and media, private sector, and government officials and Present Understanding”; “Farmers’ Rights and IPRs: trade negotiators to discuss emerging trade issues and Perspectives of the Breeders and Seed Companies”; deliberate on the future of trade policy in South Asia. “Farmers’ Rights and IPRs: Perspectives of Farmers and The seminar was divided into six sessions: “Future of Farmers’ Organisations”; “International Regime on Multilateralism – Implications for South Asia”, “Eco- IPRs: Options and Challenges”; “Institutional Mecha- nomic Cooperation in South Asia in the Changed Con- nisms within National Regimes on IPRs and ABS”; and text”, “Trans-Regional Trade Agreements in South “National and International Agenda for Developing Asia”, “Benefiting from Trade Reforms: Behind the Countries.” More than 50 participants from Bangladesh, Border Issues”, “Trade Policymaking in South Asia”, Bhutan, France, India, Malaysia, Nepal, Norway, Paki- and “Future of Trade Policy in South Asia”. The sem- stan and Sri Lanka attended the event. The seminar was inar was organised as part of “Progressive Regional part of SAWTEE’s “Regional Programme on Securing Action and Cooperation on Trade (PROACT–Phase Farmers’ Rights to Livelihood in the Hindu-Kush Hi- II)” Project, which SAWTEE has been implementing malayan (HKH) Region”, which has been under imple- in South Asia since August 2004. n mentation since 2001. n

Society Conference held in Dhaka Congratula tions in 2003. He also played a critical role in the national preparatory Dr Debapriya Bhattacharya has been appointed process for the WTO Ministerials as the Ambassador and Permanent Representa- held in Cancun and Hong Kong. tive of Bangladesh to the World Trade Organiza- Dr Bhattacharya played a tion (WTO) and United Nations (UN) Offices in guiding role in organising the Geneva for the next two years. A renowned International Civil Society Forum economist and a civil society leader, Dr Bhatta- 2005: For Advancing LDC Inter- charya has been leading the Centre for Policy ests in the Sixth WTO Ministerial Dialogue (CPD), Bangladesh as its Executive held in Dhaka in 2005. He has Director since 1999. been a member of the Advisory Dr Bhattacharya has been involved in policy Committee on WTO Affairs, Ministry of Commerce, influencing on various critical issues, particularly Government of Bangladesh. He led CPD’s Geneva macroeconomic and trade issues. He was a mem- Tracking Missions to the WTO, United Nations ber of the official Bangladeshi delegation to the Conference on Trade and Development (UNCTAD), WTO Fourth Ministerial Meeting held in Doha in Diplomatic Missions of several countries and other 2001 and the Second Meeting of the Least Devel- non-governmental organisations in Geneva in 2002 oped Country (LDC) Trade Ministers held in and 2005. Dr Bhattacharya is also a member of Dhaka in 2003. He provided leadership in conceiv- the Advisory Board of SAWTEE’s Trade Insight ing and organising the Pre-Cancun LDC Civil Magazine. n Vol.3, No.2, 2007 • Trade Insight • 39 Book: Impact of Textiles and Book: Export Diversification Book: Trade and Industrial Clothing Quota Phase Out on Strategy for Nepal Policy Environment in Nepal Nepal – A Study from Human Publishers: SAWTEE and Publishers: SAWTEE and Development Perspetive ActionAid Nepal ActionAid Nepal Publishers: SAWTEE and Year Published: 2007 Year Published: 2007 ActionAid Nepal Year Published: 2007

Book: Trade Negotiation Discussion Paper: Govern- Issue Paper: The WIPO Strategy for Nepal ment Support to Textiles and Development Agenda Publishers: SAWTEE and Clothing Sector – A Study of Publisher: SAWTEE ActionAid Nepal Select South Asian Countries Year Published: 2007 Year Published: 2007 Publisher: SAWTEE Year Published: 2007

South Asia Watch on T rade, Economics & Environment (SAWTEE) is a regional network that operates through its secre- tariat in Kathmandu and member institutions from five South Asian countries, namely Bangladesh, India, Nepal, Pakistan and Sri Lanka. The overall objective of Policy Brief: Review of Article 27.3 (b) of Briefing Paper: Textiles and Clothing SAWTEE is to build the capacity TRIPS Agreement – Policy Issues for South Sector in South Asia – Current Status and Asia Future Potential of concerned stakeholders in Publisher: SAWTEE Publisher: SAWTEE South Asia in the context of Y ear Published: 2007 Y ear Published: 2007 liberalisation and globalisation. 40 • Trade Insight • V ol.3, No.2, 2007 w w w.sawtee.org