The looming spectre of ‘non-violation complaints’

A decades-old understanding at the WTO which protected recourse to certain policies overriding intellectual property rights has lapsed. With its expiry, the availability of everything from affordable farm inputs to life-saving generic medicines is now at risk.

K.M. Gopakumar

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AT MC14, a longstanding moratorium on so-called ‘non-violation complaints’ under the WTO’s intellectual property rules – a mechanism that had been quietly extended at successive ministerial conferences for nearly three decades – was not renewed.

The stakes are higher than the obscure terminology suggests. The WTO’s Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) requires its member states to enforce 20-year patent monopolies across everything from veterinary vaccines and tractors to pharmaceuticals and medical devices. But the Agreement also contains flexibilities: provisions allowing governments to refuse patents on minor reformulations of existing products, or to issue compulsory licences for cheaper, life-saving generic alternatives to patented medicines. These are not loopholes; they are features of the Agreement, hard won in negotiations.

The difference these flexibilities make is tangible. In India, generic liver and kidney cancer drugs can cost up to 97% less than their patented equivalents. In Malaysia, cheaper generics enabled the government to provide free HIV and hepatitis C treatment. In Thailand, a government programme using generic versions of seven patented medicines saved $370 million over five years and treated an additional 84,158 patients. Compulsory licensing made all of this possible. Without the moratorium, however, any country issuing such a licence would be inviting a legal challenge.

Non-violation complaints are the catch. Under WTO law, a member state can bring a dispute even where no rule has been broken, on the grounds that an expected benefit has been ‘nullified or impaired’. Applied to TRIPS, non-violation complaints could be used to challenge a government for exercising the very flexibilities the Agreement provides: issuing a compulsory licence, say, or applying stricter patentability criteria. It is, in effect, a mechanism to penalise the lawful exercise of rights the Agreement itself confers.

This is not an abstract risk. The United States has repeatedly flagged Section 3(d) of India’s Patents Act (which restricts the scope of patentability) as a trade irritant in its annual National Trade Estimate reports. The Trump administration’s Agreement on Reciprocal Trade with Argentina goes further, requiring Buenos Aires to ‘expeditiously’ repeal its own equivalent. The pharmaceutical giant Novartis already tried to argue before Indian courts that Section 3(d) breached the TRIPS Agreement. It failed. Without the moratorium, such challenges could migrate from national courts to the WTO, where enforcement carries the weight of trade sanctions.

WTO members have long recognised this danger, maintaining the moratorium on TRIPS non-violation complaints since the Agreement’s inception and renewing it at subsequent ministerial conferences. With MC14 failing to continue the extension, however, the moratorium has now expired.

The timing could hardly be worse for developing countries. Official development aid is in retreat, with the US pulling out of the World Health Organization (WHO), where it had been the single largest donor, and cutting funding to GAVI, the vaccine alliance that has immunised more than a billion children in the world’s poorest countries. In this environment, the ability to use TRIPS flexibilities, from compulsory licences on medicines to agricultural inputs to educational materials, is not a luxury. It is a lifeline.

Some trade officials may be tempted to shrug off the risk on the grounds that the appellate arm of the WTO’s system for hearing disputes remains paralysed. That offers less comfort than it appears. The Multi-Party Interim Appeal Arbitration Arrangement (MPIA), a workaround joined by a growing number of WTO members, can still render WTO dispute panel rulings enforceable. The European Union also has its own enforcement regulation, sometimes called the ‘bazooka’, which allows Brussels to retaliate unilaterally against countries that appeal rulings into the void rather than joining the MPIA; it is already contemplating using it against Indonesia over nickel export restrictions. An Indian compulsory licence on a patented medicine could easily be the next target.

There is a further wrinkle. Several free trade agreements tie their intellectual property provisions to the WTO moratorium; with the expiry of the moratorium, non-violation complaints could automatically become actionable under those FTAs as well.

For farmers and patients, the math is simple: they need affordable seeds, fertilisers, machinery, spare parts and medicines, and the TRIPS non-violation moratorium is the legal backstop that keeps these within reach. For many developing countries, TRIPS flexibilities are no longer a policy option. They are the last line of defence. Letting the moratorium lapse pulls the rug from under those who can least afford it.                                                   

K.M. Gopakumar is a senior researcher and legal adviser with the Third World Network.

This article was written with inputs from the TWN delegation that was at MC14 in Yaoundé.

*Third World Resurgence No. 367, 2026/2, pp 31-32