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TWN
Info Service on Intellectual Property Issues (May21/10) Washington DC, 20 May (D. Ravi Kanth) – The chair of the WTO’s TRIPS Council has apparently conveyed to the least developed countries (LDCs) to drop their demand of the “post-graduation” element in their proposal for extending Article 66.1 of the TRIPS Agreement that would expire at the end of next month, in a statement that appears to be aligned with five major developed countries, said people familiar with the development. At a small-group meeting held on 18 May, the United States, the European Union (EU), the United Kingdom, Switzerland, and Japan conveyed to the LDCs, in varying emphasis, that they must remove the demand for a “post-graduation” element in their extension proposal submitted in October last year. The TRIPS Council chair, Ambassador Dagfinn Sorli from Norway, who convened the small-group meeting and later spoke separately to the LDCs, apparently chose to side with the five developed countries by conveying to the LDCs that they have to follow suit, said people familiar with the development. For the past eight months, the five developed countries have almost refused to indicate what they intend to do as regards the LDCs’ comprehensive proposal on the proposed extension under Article 66.1 of the TRIPS Agreement. Under Article 66.1 of the TRIPS Agreement, the poorest countries are exempted from implementing the obligations on the protection and enforcement of intellectual property rights, due to the lack of a viable technological base, their vulnerabilities and specific economic conditions since 2005. Until now, the exemption under Article 66.1 was extended twice from 2005 to 2013, and from 2013 to 1 July 2021. In October last year, the LDCs submitted their request (IP/C/W/668) seeking an extension of the LDC transition period, for as long as a country remains an LDC, and an additional period of 12 years when a LDC transits to developing country status, to ensure smooth transition. Their request is justified by the contents of UN Resolutions 59/209 of 20 December 2004 and 67/221 of 21 December 2012, inviting all Members of the World Trade Organization to consider extending to graduated least developed country Members the existing special and differential treatment measures and exemptions available to least developed country Members. Due to the rapidly spreading COVID-19 pandemic, the LDCs are placed in a much worse basket now than in the past, necessitating special treatment on several fronts from the US and the EU, said Nobel Laureate Joseph Stiglitz in his recent report. At the informal small-group meeting with the TRIPS Council chair and officials from the five countries – the US, the EU, the UK, Switzerland, and Japan – and the LDC members led by Chad, the LDCs made their case on the urgent need for a third extension after 1 July 2021. The LDCs argued that the underlying rationale of their proposal laid out the basis for a reasonable, meaningful and effective transition period, said people familiar with the development. At the meeting, the US apparently threatened that they are frustrated as LDCs have not changed their position, suggesting that such a fixed position of the LDCs is not helpful and the TRIPS Council may not decide anything during its scheduled meeting next month, said people, who asked not to be quoted. Surprisingly, the US has remained silent during all these seven months and refused to spell out its response to the LDC proposal. However, it issued an arbitrary diktat at the meeting, said people, who preferred not to be quoted. In their one-line statements, the EU and UK said they have nothing to suggest, arguing that they are awaiting their response from their capitals, said people, who asked not to be quoted. Switzerland has informed that in terms of the suggested length of the exemption under Article 66.1, they have nothing specific to add from the capital. But the Swiss delegate suggested that a further extension should ideally and sufficiently address the needs and challenges of the LDCs, said people who asked not to be quoted. At the meeting, Japan indicated that they have nothing from their capital in terms of a suggested duration of the (transition) period. The Japanese official spoke about the importance of IPRs (intellectual property rights) to support economic development. According to Japan, the protection of IP rights makes it possible to secure higher investment in research and development, encourages foreign direct investment and technology transfer, and contributes to creating job opportunities. The Japanese official said this is also true for the LDC Members whose trade scale is small. Therefore, said Japan, establishing an IP system is important for LDC Members and it will also contribute to sustainable development for LDC Members. Japan’s argument may, however, lack basis as the TRIPS Agreement itself recognizes LDCs’ need for policy space in its preamble that, “Recognizes the special needs of the least-developed country Members in respect of maximum flexibility in the domestic implementation of laws and regulations in order to enable them to create a sound and viable technological base”. As part of a systemic approach, the LDCs have agreed to the chair’s suggestion to continue and exhaust discussion on two-folds: (1) focus on the elements of an LDC extension decision under Article 66.1 of the TRIPS Agreement and (2) to address how the request for an exemption for post-graduated LDCs can be taken forward. But the five major industrialized countries chose to ignore this approach, and went on to insist that the LDCs must drop the “post-graduation” element from the extension proposal altogether, said people, who asked not to be quoted. Surprisingly, the chair chose to echo the same position as adopted by the five countries by asking the LDCs to change their position by removing the “post-graduation” element, and even arguing that the LDCs settle for impractical short transition periods granted in the past, said people, preferring not to be quoted. Instead of engaging in an impartial and honest-brokering between the two sides, the chair sided with the five industrialized countries, said a person, who asked not to be quoted. The LDCs seem dismayed with the chair’s position and they find it hard to accept such an approach, which lacks a logical basis for changing their submission without justification. The LDC coordinator has conveyed to the chair that their members are frustrated, as the five industrialized countries have not proposed any specific length, while they are creating pressure on the LDCs to change their position without any valid reason, said people, who asked not to be quoted. According to LDC officials, they have assessed their needs and accordingly submitted this duly motivated request at the TRIPS Council. Now if some members wish to oppose this proposal, they should do so with reasons and an alternative proposal, the officials said.
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