Global Trends by Martin Khor

Monday 8 October 2007

WIPO thrown into deep crisis

The World Intellectual Property Organisation has been thrown into an institutional crisis over allegations that its Director General engaged in unethical activities. Wrangling over this issue among the governments caused its budget not to be adopted.


The world’s main body dedicated to intellectual property issues has been thrown into an institutional crisis because governments are unable to agree on what to do about its Director General who is alleged to be involved in serious misconduct.

The World Intellectual Property Organisation (WIPO), a United Nations agency based in Geneva, ended its annual General Assembly last week without adopting its budget for the next two years, thus causing doubts on its programmes and funding.

The wrangling on the budget was a proxy for the underlying conflict – how to deal with allegations that the Director General Mr. Kamal Idris had for many years misrepresented his age in order to have a better chance to be hired by and promoted within WIPO, among other things.

An internal audit report (which is still not made public) last year exposed irregularities about the age, and Kamal Idris himself then revealed that his real birth year was 1954 and not 1945 that he had used for many years.

It was a typographical error, explained the DG.  But the audit report gave details of how the wrong birth-date had been used for many years and the benefits that were obtained from this misrepresentation.

By stating that he was older and by implication more experienced, Kamal Idris was able to obtain senior positions, including his present high post, according to the allegations.

For several years now there have been accusations, some of them published in Geneva newspapers, of possible unethical behaviour involving the DG and other Secretariat staff, including personal benefits from contracts for WIPO’s new building, and the construction of a swimming pool in the DG’s house.

Thus the issue of age misrepresentation was only the latest in a line of scandals that have been reported.

Some developed countries, led by the United States and the United Kingdom, recently called on Kamal Idris to leave his office as soon as possible (his term expires in 2009) as his remaining would affect its image and work. 

The US wanted the internal audit report and action on it to be discussed at the Assembly. But the Group of African countries argued that this was premature because the report had not yet been discussed by the WIPO’s audit committee.

With the whiff of crisis in the air, a small group of countries was convened by the WIPO Assembly President, the Nigerian ambassador Martin Uhomoibhi, to resolve this issue. 

But it failed to do so, even after many days.  The US, backed by European countries and Japan, wanted the audit committee to meet and present a report within 2 months, and for a decision now to convene a special WIPO Assembly session next February.

The Africans, backed by many developing countries, agreed to the audit committee meeting and reporting speedily, but wanted any action to be considered only after the report is issued.  They were against pre-judging the issue or the assumption of guilt, which would be the case if a decision is taken now to convene a February special session.

With deadlock on this issue, the developed countries then moved to block the passing of WIPO’s two-year budget and programme for 2008-9.  This is unusual because the budget committee had already approved the budget, and the Assembly’s endorsement is the usual practice.

The developed countries used the fact that there could not be agreement on another proposal (by the US and Japan to cut patent fees charged by WIPO) to argue that WIPO’s future revenue was not known and thus a budget could not be approved now.

It was a barely disguised tactic to link the passing of the budget to an outcome on the DG issue that was satisfactory to them.  Since there was no decision on the DG issue, the new budget is now blocked.  

WIPO’s rules say that if a new budget is not approved, the organisation can still operate using the same level of financing of the previous two years.  Thus there is no immediate threat of WIPO having to stop its salary bills and activities. But the expansion of its spending and activities, envisaged in the new budget, is affected.

What the developed countries achieved was to generate an atmosphere of crisis and a mood that future activities to negotiate new treaties or new types of activities would basically be suspended until the DG issue is resolved.

They are likely to now insist that a special Assembly session be held on this issue. For that to happen, more and more developing countries will have to give up their defence of the DG.

Many delegates from Africa, Asia and Latin America say that they are not defending the DG, but that he like anyone else deserves fair treatment and due process, and that there should not be a presumption of a need for drastic action until the matter is discussed at the audit committee.

They also resent the thinly veiled blackmail – that the Development Agenda programme just passed by the Assembly last week, which is meant to benefit developing countries – will not be properly implemented because the budget is blocked, and unblocking will come only when the DG agrees to leave.

Many are asking the question why the Western countries decided to move against the DG at this point, when the allegations of financial mismanagement at WIPO had surfaced years ago.

Some diplomats from developing countries are of the view that the developed countries had in fact liked Kamal Idris because he had led the Secretariat to implement their agenda to strengthen and tighten intellectual property in the developing countries, which enables the companies of developed countries to obtain patents and copyright in the developing world.

Most of the patents in developing countries are applied for and owned by firms and individuals of developed countries, which are then able to make monopoly profits and royalties from sales and licenses in the developing countries.

However in recent years the developing countries have been advocating a major reform in WIPO that would make its rules and programmes more development-friendly. The DG was not known to be a friend of this process, but he was unable to stop it.

According to the diplomats, the powerful countries find that WIPO and its Director General are no longer useful to them, and that a change in leadership is urgently required to reverse the direction in the organisation is moving before the “development” aspects get entrenched.

Thus not only is the leadership of WIPO at stake, but also its fundamental aims, direction  and activities.  The next months will be crucial in whether and how these are settled.