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Info Service on Intellectual Property Issues (Dec25/01) Geneva, 1 Dec (D. Ravi Kanth) — The United States, the European Union, and Japan, among others, reportedly blocked a request from Brazil, Colombia, South Africa, and India to convene a formal or informal meeting at the World Trade Organization (WTO) to discuss trade data relating to intellectual property (IP) payments made by developing countries. This comes as developing countries are forced to pay tens of billions of dollars in IP royalties, according to people familiar with the development. More notably, the WTO’s Economic Research and Statistics Division (ERSD) has not compiled data on IP trade flows since the global trade body’s establishment in 1995, said people familiar with the matter. While the ERSD has meticulously maintained data on trade in goods and services, it has never carried out the same data collection for IP flows, which would indicate the magnitude of the payments made by developing countries on IP royalties, said an intellectual property negotiator who preferred not to be quoted. During a TRIPS Council meeting on 11-12 November, members remained divided on two key issues: the demand for a permanent moratorium on “non-violation” complaints under Article 64.2 of the TRIPS Agreement, which is due to expire in March next year, and the demand to convene a meeting to discuss trade-related data on royalty payments for patents. On the TRIPS moratorium, Switzerland and the United States continued to oppose a permanent moratorium on “non-violation” complaints, a move demanded by many developing countries as well as the European Union and Norway, among others, said people familiar with the meeting’s proceedings. BLOCKING TALKS ON IP FLOWS Earlier, Colombia had submitted a proposal (IP/C/W/721) highlighting the WTO’s failure to provide data on the implementation of the TRIPS Agreement. The proposal expressed sharp concern over “how little attention is paid to trade-related metrics of intellectual property.” Colombia said, “in the nearly thirty years since, there has been scant systematic discussion or data collection on IP trade flows at the WTO,” adding that “while WTO statistics, monitoring reports, and Trade Policy Reviews provide detailed, granular analysis of trade in goods and services, coverage of IP trade is limited to a few or not consistent efforts.” For instance, according to Colombia, “the WTO and its members conduct in-depth studies of trade balances and flows in goods and services, even at highly disaggregated levels, but offer little comparable analysis for IP: Which Members are net recipients of IP payments? Which countries run persistent deficits? Are deficits and surpluses in IP flows relevant for trade analysis? Are these financial flows significant enough to warrant systematic tracking in WTO statistics?” “Fortunately,” Colombia said, “some relevant data can be extracted from official sources” such as the IMF and the World Bank, which “maintain robust but underutilized databases on international financial payments for the use of intellectual property.” It said that the IP-related payments – “typically known as royalties – are recorded as distinct items in countries’ “Balance of Payments” statistics.” Despite the richness of this data, it is largely overlooked in global trade discussions, it added. Using data from these sources, Colombia provided a snapshot showing that “transfers from developing to developed countries are quite sizeable in absolute terms.” The data include: 1. In 2023 alone, low- and middle-income countries paid USD 97.9 billion in royalties for the use of IP and received USD 16.6 billion – a deficit of 589%. 2. The least developed countries paid USD 434.9 million and received USD 50.8 million. 3. The Arab World paid USD 1.18 billion and received USD 69.7 million. 4. Argentina paid USD 1.75 billion and received USD 250.6 million. 5. Brazil paid USD 6.38 billion and received USD 920.9 million. 6. China paid USD 42.7 billion and received USD 10.97 billion. 7. Chile paid USD 1.36 billion and received USD 79.6 million. 8. Colombia paid USD 1.94 billion and received USD 225.3 million. 9. Costa Rica paid USD 1.02 billion and received USD 7.62 million. 10. India paid USD 14.35 billion and received USD 1.53 billion. 11. Indonesia paid USD 2.50 billion and received USD 213.5 million. 12. Malaysia paid USD 2.73 billion and received USD 282.0 million. 13. Pakistan paid USD 293 million and received USD 13.0 million. For developed countries, examples of these payments include: 1. In 2023, the US paid USD 47.5 billion and received USD 134.44 billion. 2. In 2023, the EU paid USD 304.1 billion and received USD 190.38 billion. 3. In disaggregation, in 2022, Germany paid USD 20.9 billion and received USD 52 billion. DEMAND FOR TALKS Against this background, a joint paper (IP/C/W/723) was submitted by Brazil, Colombia, India, and South Africa demanding a substantive discussion on IP royalty flows. The co-sponsors noted that during the discussion at the June 2025 TRIPS Council meeting, “several delegations raised that the Council may request presentations from WIPO, WHO, ERSD Division of WTO and other relevant international organizations to discuss the issues which have come up and get the latest factual updates and information and thus have technical discussions.” Expressing disappointment over the lack of consensus, neither on the topics for holding the informal sessions, nor on inviting relevant organizations to present at the Council meeting, the co-sponsors submitted the following questions: * In the context of the WIPO Treaty on Intellectual Property, Genetic Resources and Associated Traditional Knowledge (GRATK treaty) adopted by WIPO in May 2024, can WIPO provide information on key provisions of the treaty, its linkage with the TRIPS Agreement, and how it addresses trade of bio-piracy goods? What is the status of future negotiations in the WIPO Intergovernmental Committee on Intellectual Property and Genetic Resources, Traditional Knowledge and Folklore (IGC) and the discussion on the inclusion of the new disclosure requirement in the WIPO Patent Cooperation Treaty (PCT)? * Can WIPO provide a presentation on its “PATENTSCOPE” tool? Does it include information on expired patents? How user-friendly and accessible is it? What are its key features and limitations, and are there any internal plans for further improvement? Does WIPO have a compilation of best practices for expired patent information databases? * Can WHO provide a presentation on the recently concluded Pandemic Agreement? What are its linkages with the TRIPS Agreement and provisions for technology transfer? How does it support access to and trade of IP-protected essential medical products in the case of a future pandemic? What future work is planned related to IP and trade? * Can the WTO’s Trade in Services & Investment Division or ERS (Economic, Research and Statistics) Division present trends in IP royalty payments over the last 30 years? How does this data capture IPR trade flow, and what are its limitations? Has any study been conducted on improving IP trade data capture? * Could the World Bank provide information on data captured for “Charges for the use of intellectual property” under Balance of Payments? What are the limitations and definitions of this data, and is it consistent with services data? The co-sponsors said the Council for TRIPS can provide a useful format to discuss these issues for the entire WTO membership. Informal, technical discussions and thematic sessions are used effectively in various other WTO bodies and could be utilized in the TRIPS Council to develop a common understanding, they added. Despite sustained efforts to organize a meeting on these issues, the US, the EU, and Japan have so far blocked any discussion. These countries apparently argued that a side event, rather than a formal/informal meeting, could be organized so that the issue could seemingly be turned into another Joint Initiative involving a plurilateral format, which they are also promoting for digital trade and investment facilitation, said people familiar with the development. +
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