TWN Info Service on UN Sustainable Development (Jun13/09)
28 June 2013
Third World Network

Dear friends and colleagues,  

Below is a TWN critique of the UN Secretary-General's report on "Science, technology and innovation, and the potential of culture, for promoting sustainable development and achieving the Millennium Development Goals" that will be considered at the high level segment of the ECOSOC annual ministerial review on 1-4 July in Geneva. 

The report promotes intellectual property (IP) to boost the attractiveness of innovation investment and improve the prospects for science, technology and innovation, although the evidence in support of such a link is tenuous. It  also fails to reflect the increasing widespread concern of the adverse impacts of current IP instruments and trends on the development and dissemination of technology and innovation for the benefit of society.

There was a call for submissions and a number of UN agencies and non-governmental organisations sent in crucial points reflecting the IP debate. It is thus shocking that the report is so biased and positive of IP for the post-2015 development framework.

Although the SG's report was released on 18 April 2013, the intense negotiations to extend the exemption for Least Developed Countries to apply the WTO Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement was already underway. On 11 June 2013, the WTO TRIPS Council took a decision (IP/C/64) to extend for a further 8 years, the flexibility of LDC Members under Article 66.1 to not apply the provisions of the TRIPS Agreement except for Articles 3, 4 and 5 (which concern national treatment and most-favored nation treatment). This decision was taken in response to the “duly motivated request” submitted by Haiti on behalf of the LDC Group in November 2012, seeking an unconditional extension for as long as a WTO Member remains a LDC.  The final hard won decision was a compromise deal as the European Union and the United States exerted intense pressure on the LDCs to accept conditionalities that are not in favour of the LDCs.

Yet the SG's report does not acknowledge the failure of developed countries to meet their obligations under the TRIPS Agreement Article 66.2 to transfer technology to LDCs, a contention raised by developing countries in numerous fora. 

The ECOSOC annual ministerial review will take place from 1 to 26 July.

With best wishes,

Third World Network

UNSG report takes pro-IP approach, omits concerns 

Geneva, 28 Jun (K M Gopakumar and Sangeeta Shashikant) – A report of the United Nations Secretary-General promotesintellectual property to boost the attractiveness of innovation investment and improve the prospects for science, technology and innovation, although the evidence in support of such a link is tenuous.

The report also fails to reflect the increasing widespread concern of the adverse impacts of current intellectual property (IP) instruments and trends on the development and dissemination of technology and innovation for the benefit of society.

The report titled “Science, technology and innovation, and the potential of culture, for promoting sustainable development and achieving the Millennium Development Goals” (the Report), was prepared for the consideration of the annual ministerial-level substantive review of the Economic and Social Council (ECOSOC) on 1-27 July in Geneva. The High Level Segment takes place on 1-4 of July with the theme after which the report is titled.

The mandate for the annual ministerial review (AMR) is in UN General Assembly Resolution GA 61/ 16, whereby the review is to be conducted by means of a cross-sectoral approach focusing on thematic issues common to the outcomes of the major United Nations conferences and summits in the economic, social and related fields, including the Millennium Development Goals (MDGs) and other internationally agreed goals. The AMR is to review progress made in the implementation of the outcomes of those conferences and summits and their follow-up processes, and assess its impact on the achievement of the goals and targets of the conferences and summits.

According to the ECOSOC website, this year’s AMR will focus on the role of science, technology and innovation, and the potential of culture – and related national and international policies – in promoting sustainable development and achieving the MDGs. It asserts that “Indeed, science, technology and innovation can play a critical role in each and every MDG, including by: fostering access to knowledge; increasing productivity, industrialization, economic growth and the creation of decent jobs; promoting health and access to essential drugs; achieving food security through sustainable, equitable agricultural systems and by raising production and incomes, especially of smallholder farms; promoting renewable energy technologies in order to respond to the dual challenge of reducing energy poverty while mitigating climate change” (see: http://www.un.org/en/ecosoc/newfunct/amr2013.shtml).

Principal partners from the UN system on this theme include the International Telecommunication Union (ITU), UN Conference on Trade and Development (UNCTAD), UN Educational, Scientific and Cultural Organization (UNESCO), UN Industrial Development Organization (UNIDO), World Intellectual Property Organization (WIPO) and UN Regional Commissions.

In addition to the introduction the Report contains six parts viz. global context of science, technology, innovation and culture; shaping the course of development: the role of science, technology and innovation; potential of culture for sustainable development; strengthening multi-stakeholder collaboration and partnerships; an enabling environment for the transformative change sustainable  development through science, technology , innovation and culture; towards coherent policy and action framework.

National enabling environment to promote R&D

The Report advocates an IP maximalist approach without any mention of adverse impacts of IP protection and enforcement on development.  The most forceful advocacy is in Part VI (A) which is discusses an enabling environment for the transformative change towards sustainable development through science, technology, innovation and culture. It deals with the enabling environment at the national level, setting out six components viz. national science, technology and innovation strategy, quality education to foster innovation, policies to foster research, development and demonstration, good governance, integration of culture into development. 

The discussion under policies to foster research, development and demonstration section prescribes two sets of action to improve innovation in science and technology. First, the Report proposes public funding and tax measures to strengthen science, technology and innovation. Secondly, it calls for strong IP protection to attract investment in innovation.  The Report states:

“Another way to boost the attractiveness of innovation investment and improve the prospects for science, technology and innovation is through strengthening the role of the intellectual property regime. The innovation process involves a range of risky research activities that eventually generate information with public good characteristics. Unless individual firms can profit from this information, they will not undertake the necessary investments. Through the intellectual property regime, governments can provide the incentives for firms and individuals to undertake creative and innovative activity by enabling them to obtain exclusive ownership of their findings for a period of time. In industry, patent and utility models protect inventions with industrial application, industrial designs protect novel designs, trade secrets protect confidential business information and trademarks protect the source of a good of one party from those of other parties”.

[According to an expert on IP and development who studied the Report, evidence that a strengthened IP regime can boost investment or prospects for science, technology and innovation is severely lacking. On the other hand, there is extensive evidence that a strengthened IP regime can hinder access to tools that are much needed to achieve development objectives, such as technologies, research and educational materials, medical products. Moreover, historically developed countries and more advanced developing countries have relied on the absence of IP protection to acquire technologies and boost local innovative and productive capacities.  Clearly the Report has failed to grasp and fully appreciate the complex relationship between IP and development. It has also failed to acknowledge that excessive IP protection, currently being advocated through international organizations (e.g. WIPO), north-south bilateral trade agreements and inappropriate technical assistance can have devastating consequences for improving scientific, technological and innovative capability.]  

Further, the discussion in this part of the Report does not elaborate on the implications of the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) and the Agreement on Trade-Related Investment Measures (TRIMS) on policy space on science, technology and innovation. The Report merely remarks, “Both agreements have considerable implications for permissible science, technology and innovation policies at the national level”. 

On IP reforms the Report cursorily states: “There have been calls for a dialogue on intellectual property regimes and the possible evolution of their focus from protection of innovation to one that fosters its dissemination”.

The only reference to technology transfer and IP in the Report is in only 3 sentences, which read: “In WTO, within the Council for TRIPS and the Working Group on Transfer of Technology, there is also an ongoing debate over technology transfer and the patent system. It relates to the implementation of article 66.2 of the Agreement, which requires developed countries to provide incentives to entities located in their territories in order to promote and encourage the transfer of technology to the least developed countries. Current debates about technology transfer and the environment therefore raise the question of whether this amounts to another intellectual property and technology transfer debate, or whether environmentally sound technologies present distinctive challenges.”

The Report also fails to reveal the failure of developed countries in fulfilling their obligations under Article 66.2 to transfer technologies to LDCs, a contention that is consistently raised by developing countries in numerous fora.

[Although the Report was released on 18 April 2013, the intense negotiations to extend the exemption for Least Developed Countries to apply the WTO Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement was already underway. On 11 June 2013, the WTO TRIPS Council took a decision (IP/C/64) to extend for a further 8 years, the flexibility of LDC Members under Article 66.1 to not apply the provisions of the TRIPS Agreement except for Articles 3, 4 and 5 (which concern national treatment and most-favored nation treatment). This decision was taken in response to the “duly motivated request” submitted by Haiti on behalf of the LDC Group in November 2012, seeking an unconditional extension for as long as a WTO Member remains a LDC.  The final hard won decision was a compromise deal as the European Union and the United States exerted intense pressure on the LDCs to accept conditionalities that are not in favour of the LDCs.]

Culture and poverty in sustainable development

The Report offers IP protection a solution to address one of the ways of using culture for poverty reduction. According to the Report, “creative industries flourish where there is an appropriate regulatory framework and broad respect for culture and creative work within society. Intellectual property rights, guaranteeing the return of value to creators and enabling widespread access to content by the public, are fundamental to this framework. Such rights also generate income and employment, often with a direct impact on disadvantaged groups”. Therefore the Report advocates for IP protection for traditional knowledge and states:

“Existing intellectual property rights, as well as sui generis rights based on intellectual property principles and systems, are important in protecting traditional knowledge from misappropriation and in equitably sharing benefits resulting from commercialization. Intellectual property systems should be tailored so as to promote technology dissemination and the protection of knowledge of indigenous and local communities”.

The Report also advocates IP in the context of indigenous culture and states: “… intellectual property rights are of fundamental importance to valuable cultural and economic assets of the indigenous and local communities who maintain, practice and develop them”. It further stresses the need for copyright protection, asserting that “In the era of the digital environment, greater emphasis needs to be placed on the exercise and management of rights, on the one hand, while, on the other hand, ensuring greater access to and sharing of creative works globally. Support through policy, law, copyright infrastructure, institutional collaboration and better business models is essential.”

An expert observes that discussion in the Report is focused on the importance of IP to protect misappropriation of traditional knowledge, failing to acknowledge that the existing IP system is in many cases a channel for misappropriation of traditional knowledge and cultural expression. Unfortunately, the Report is also silent on the consistent failure of the international community to take effective steps to modify the existing IP system to minimize such misappropriation.

Public Private Partnership

The Report proposes public private partnership (PPP) in Section V, which discusses the strengthening of multi-stakeholder collaboration, and partnership.  In order to promote PPP in the culture sector the Report states: “While the public sector puts in place systems that would support the management and exploitation of intellectual property assets, the private sector can contribute necessary resources to make cultural activities and products profitable.”

Open Innovation

Part II of the Report describes the global context of science, technology, innovation and culture. The first section of Part II explains open innovation, which is however portrayed with a particular understanding of the concept. The general understanding of open innovation is that it promotes a collaborative platform for research and development (R&D) and the outcomes are available for use without any intellectual proprietary rights restrictions. However, the Report describes open innovation as R&D innovation based on network models not devoid of IP protection.

According to the Report, “These innovation models place emphasis not on knowledge within an enterprise, but on untapped knowledge outside the enterprise, increasing the value of collaborative research on communication tools and newly developed networks of people. Such networks can be systemically organized or developed in an ad hoc manner among individuals who have the necessary expertise and knowledge.”

However, according to the Report talks about “managing the fruits of that innovation, including through transferring knowledge to geographical regions that can benefit, creating policies and structures that encourage such innovation, protecting the innovative results through intellectual property and other mechanisms, and creating education and training programmes for those who will generate or commercialize the new products and services”.

Internationalization of R&D

Part II of the Report also contains the discussion on the internationalization of R&D. It stresses that, “Strengthening research, development and innovation can promote economic growth and competitiveness, but one of the principal challenges is ensuring that the results of research and development infrastructure used by commercial entities for knowledge creation and innovation are directed towards sustainable development”.

However, the Report opposes open access to information and methodologies to promote research and development activities. It suggests: “Additionally, promoting the commercialization of research and development activity could result in the application of intellectual property rights to support new technology-oriented firms, rather than allowing open access to information and methodologies. One positive effect is that internationalization of research and development is associated with increased investment in high quality infrastructure for research and development, particularly at higher education institutions, which benefit students and also attract professional workers in research and development, contributing to building human capital”.

South-South Cooperation

Part IV of the Report discusses the importance of South-South cooperation to create an enabling environment at the international level, i.e. the enabling environment for the transformative change towards sustainable development through science, technology, innovation and culture. Here, for the first time, the Report mentions the need for balance in IP but without any further elaboration.  It states: “Improving access by developing countries to existing and new technologies, and promoting the development of their own technological capabilities remain important components of establishing balanced and equitable knowledge-based global markets. As part of the innovation ecosystem, the promotion of a balanced legal and administrative framework of intellectual property protection is also crucial to promoting and incentivizing innovation, investment and technology transfer”.

The Report is completely silent on the implications of IP rights on development, especially in the context of the MDGs connected to health, especially Goals 5 and 6 viz. improve maternal health and combat HIV/AIDS, malaria and other diseases.  There is no discussion on intellectual property and access to medicines, a priority that has been on the UN agenda for several years. 

The Report similarly ignores various reports on the barriers erected by IP, especially patents, on accessing climate-friendly technologies. Further, there is absolute silence on the implications of IP protection for access to food and safe water.

(See WIPO study that includes patents on water purification technology: http://www.wipo.int/patentscope/en/programs/patent_landscapes
/reports/water_treatment.html)

In 2012, the MDG GAP Taskforce Report clearly expressed concerns on IP and access to medicines, especially on the “TRIPS plus” provisions. It stated: “TRIPS plus provisions that may have an impact on public health or may hamper the use of flexibilities have included placing restrictions and limitations on the right to issue compulsory licences; providing for patent extensions or supplementary protection; requiring drug regulatory authorities to consider the patent status of medicines before granting marketing authorizations to generic manufacturers; requiring test data protection that restricts the use of clinical test data on pharmaceutical products by drug regulatory authorities for the approval of generic medicines for a certain period of time; and allowing patent holders to restrict parallel imports, which may prevent developing countries from buying medicines from the most affordable international source.”

The Outcome Document of the UN Conference on Sustainable Development (Rio+20) acknowledged the implications of IP on technology.  The Report for the ECOSOC ministerial review ignored these concerns completely.

The Rio+20 Outcome Document also emphasized the importance of access to IP on favorable terms. Paragraph 269 clearly states that, “We emphasize the importance of technology transfer to developing countries, and recall the provisions on technology transfer, finance, access to information and intellectual property rights as agreed in the Johannesburg Plan of Implementation, in particular its call to promote, facilitate and finance, as appropriate, access to and the development, transfer and diffusion of environmentally sound technologies and corresponding know-how, in particular to developing countries, on favorable terms, including on concessional and preferential terms, as mutually agreed” .

The MDG outcome also document clearly emphasised “Promoting the strategic role of science and technology, including information technology and innovation in areas relevant for the achievement of the Millennium Development Goals, in particular agricultural productivity, water management and sanitation, energy security and public health. The capacity for technological innovation needs to be greatly enhanced in developing countries, and there is an urgent need for the international community to facilitate the availability of environmentally sound technologies and corresponding know-how by promoting the development and dissemination of appropriate, affordable and sustainable technology, and the transfer of such technologies on mutually agreed terms, in order to strengthen national innovation and research and development capacity”.

The Report further ignores the Development Agenda adopted by WIPO Member States in 2007 to address the developmental concerns related to IP protection and enforcement. It is silent on the development implications of IP, especially the barriers created by IP in accessing technologies and instead proposes a strong dose of IP protection to achieve all MDGs.

It is disconcerting that the Report did not take into account concerns expressed by various organisation through their submissions, at the request of the Secretariat to prepare the Report. The website of ECOSOC claims that “the Secretariat requested inputs and information on relevant programmes from across the UN system”.

The Committee on Development Policy (under the UN Department on Economic and Social Affairs) made a submission at the request of the Secretariat. The Committee’s submission clearly expressed concerns on IP in the dissemination of technology and the international IP regime (http://www.un.org/en/ecosoc/newfunct/pdf13/sti_cdp.pdf). Regarding the IP regime the submission stated:

“Achieving a balance between the need to provide incentives for the generation of knowledge and innovation and the need to facilitate access to knowledge and innovation is not easy.
 

“In this regard, the role that intellectual property rights play in the technological development of a country has long been the subject of an intense debate.

“Since the 1980s, those in favour of greater uniformity and protection for IP rights succeed in defining the IP regime with an agenda of global harmonization of national rules, which has implied in a more restricted policy space for developing countries, thus placing the late developers at a disadvantage as the policy tools and approaches used by other countries –including developed countries themselves—in the past are no longer available”.

Further, regarding the negative impact of IP on technology dissemination the submission stated:

“More recently, however, there have been revived concerns about the negative effects of the current IP system and recognition that the IP system needs to evolve to foster dissemination of technology, including by allowing countries to have room to tailor their own national IP system to their specific development needs. In this regard, patent based regimes are not necessarily compatible with the technological development stage of many developing countries and may deter innovation in these countries”.

Similarly, the Report ignored the UNCTAD submission, which clearly stated that, “trade rules, intellectual property rights and investment can offer opportunities but also be hindrances in promoting technological change”.

UNEP also warned on the IP implication on technology transfer. According to the UNEP submission, “Criticism exists of the high transaction costs of obtaining information or negotiating and acquiring technologies protected by intellectual property rights. According to GEO 5, it has been argued that there may be a need for beneficial differentiation in patent rights such as expedited patent examinations in environmentally sustainable technologies, and the facilitation of voluntary patent pools”.

Unexpectedly, the advocacy for IP protection came from UNIDO. Its submission on IP is clearly reflected in the Report. The UNIDO submission states: “Another way to boost the attractiveness of innovation investment and improve the prospects for STI (science, technology and innovation) is through strengthening the role of the Intellectual Property Regime. The innovation process involves a range of highly risky problem solving activities that as the process evolves generate information with public good characteristics. Individual firms cannot appropriate to their benefit this information and hence, do not undertake the necessary investments”.

Interestingly, there was no submission from the WHO although expert reports including by the Commission on Intellectual Property, Innovation and Public Health (CIPIH) and Consultative Expert Working Group (CEWG) of the WHO have addressed in detail the link between IP and innovation and health. These reports reveal the failure of the IP system, especially the patent regime, to meet the health R&D needs of developing countries which are part of the MDGs.