TWN Info Service on WTO and Trade Issues (Jul13/05)
18 July 2013
Third World Network
 
WIPO: Controversy over new external offices
Published in SUNS #7629 dated 18 July 2013
 
Geneva, 17 Jul (Sangeeta Shashikant) – The World Intellectual Property Organisation's proposal to establish five new external offices, two in Africa and one each in China, the Russian Federation and the United States, has caught Member States by surprise.
 
This occurred during the WIPO Program and Budget Committee (PBC) meeting held in Geneva on 8-12 July.
 
The proposal unleashed wide-ranging and varied views and concerns of WIPO members, with many questioning the credibility of the process that led to the proposal, as well as the modalities for setting up external offices (EOs). WIPO currently has such offices based in Brazil, Japan and Singapore, with a liaison office in New York.
 
Concerns raised include the lack of an inclusive and transparent member-driven process, the absence of an in-depth study on EOs and an overarching framework with agreed criteria and guidelines for the establishment of EOs, as well as the failure on the part of the Secretariat to follow procedures set out in the WIPO Convention.
 
During the discussion, WIPO's legal advisor, Mr. Edward Kwakwa, confirmed that WIPO's practice in signing agreements with governments to set up an EO prior to the approval of the Coordination Committee was in violation of the provisions of the WIPO Convention.
 
Divergent views resulted in deferment of the decision on the Secretariat's proposal contained in the draft Program and Budget for the 2014/2015 biennium to the next meeting of the PBC in September. The Secretariat is also to prepare an information paper responding to questions and requests raised during the PBC meeting and an in-depth study to address, in a comprehensive manner, all the issues related to EOs.
 
Some observers speculate that the timing of the Secretariat proposal is closely linked to the election of the WIPO Director-General due in 2014.
 
An informal paper circulated by the Secretariat (also known as "the white paper") states that "establishment of External Offices is a process, rather than a single event", indicating that an external office in India and in a Spanish-speaking country to service the Group of Latin America and Caribbean are next on the list. According to the paper, "The list could be extended".
 
Francis Gurry, the Director-General of WIPO, in his address to the PBC, justified establishment of new external offices by asserting that, "We are a global organisation and require global buy-in", adding that the external offices are important for that buy-in, as "IP (intellectual property) is not territorial".
 
Gurry also said that "Member States [and not the Secretariat] are the demandeur", as it has received over 20 requests for such offices, adding that the Secretariat was not negative to the requests and believed that "small, tight, strategically placed, geographically representative" external offices could be useful for improving the presence of the organisation.
 
The setting up of new external offices gained political visibility following the election of Gurry as the Director-General in 2008. According to informed sources, in 2009, the creation of an external office in Brazil conveniently relocated the competing candidate from Brazil for the head of WIPO (then an employee of WIPO), against whom Gurry won only by a mere one-vote margin in the 2008 elections.
 
Following the opening of the Brazilian external office, in 2010, the Secretariat presented to the WIPO Assemblies a paper pointing to "the absence of a clear policy on the part of the Organization for the establishment of new offices", and proposing that the Director-General will "initiate a consultation process with Member States ... with a view to being able to recommend a policy for the consideration of Member States at the meetings of the WIPO Assemblies in September/October 2011".
 
The Secretariat-prepared white paper also said that the consultation process would at least cover the following questions: "(i) What needs and purposes may be served by external offices?; (ii) What functions should external offices perform?; (iii) What is the cost/benefit analysis of performing those functions through external offices compared to performance of the functions from Headquarters?; (iv) How would the relationship between Headquarters and external offices function?; (v) How should the location of external offices be decided?"
 
According to the white paper circulated at the July 2013 PBC meeting, "open informal consultations" were held on 13 December 2010 and 16 June 2011 and it was generally agreed that: "(1) External offices should add value and undertake activities that can be performed more efficiently or effectively than at Headquarters; (2) External offices could have different mixes of functions in response to regional priorities and specificities; (3) A new external office should only be established if it is financially feasible for the Organization to do so; and (4) A phased and prudent approach should be adopted towards the establishment of functions and corresponding resourcing in the EOs".
 
Although the absence of a policy for the establishment of EOs was identified way back in 2010, to-date, no policy has been presented to WIPO Members for a formal discussion or adoption.
 
Several sources expressed alarm at the rate at which EOs are being established, particularly as from a development perspective, significant shortcomings remain in the orientation and management of WIPO at the headquarters level.
 
CONCERNS OF WIPO MEMBERS
 
Belgium, on behalf of Group B (composed of developed countries), said that it was not in a position to agree to the proposal of new EOs, adding that limited justification has been provided for an issue that had major repercussions. It stressed on the need for a cost-benefit analysis, and sought several clarifications including whether the functions of the EO would be cumulative or alternative to the HQ activities; whether EOs would provide training services; and how to ensure that vulnerability of IT (information technology) systems will be safeguarded.
 
It also questioned the budgetary implications in the short- and long-term, the criteria for closing an EO, and whether there will be a limit to the number of EOs that are to be established. It also said that under the UN notion of "Delivering as One", there were existing offices that could be used for capacity-building.
 
It said that "establishing an EO is like having a baby" and thus "is an important decision" which is "hard to take back".
 
Group B also pushed for removing the subject of EO from the scope of the 2014/2015 draft Program and Budget; however, this move was strongly objected to by Algeria (on behalf of the Africa Group), China and the Russian Federation, that favoured the adoption of the budget as proposed by the Secretariat.
 
Many members of Group B (Spain, Italy, Germany, France, Sweden) also spoke up raising a variety of concerns with regard to the proposal on EOs.
 
Germany queried whether the conclusion of Agreements signed between WIPO and the new EO followed the procedure set out in Article 12 (4) of the WIPO Convention, which requires the approval of the Coordination Committee prior to signing of those Agreements.
 
Italy said it was not in a position to take a decision on the matter until a formal strategy document is provided with information on the long-term and short-term costs. Sweden, Canada and Switzerland called for a cost-benefit analysis to be undertaken.
 
In response to Germany, WIPO's legal advisor, Mr. Edward Kwakwa, confirmed that WIPO's practice in signing agreements with governments for the setting up of EOs prior to the approval of the Coordination Committee was in violation of the provisions of the WIPO Convention.
 
[In a Q&A circulated during the PBC meeting, the Secretariat explained that on average, approximately 300,000 Swiss francs have been set aside for non-personnel costs per new office, although the actual costs will very much depend on the terms of the agreement concluded with the host countries, on the maturity of the EO and the types of services/products that are to be provided by the EO. No new posts are foreseen for the staffing of the new EOs.]
 
Poland, on behalf of the Central European and Baltic States, also called the material presented by the Secretariat "not convincing", adding that it needs more information on the added value of existing EOs and new offices and the long-term costs of such EOs.
 
Trinidad and Tobago, on behalf of the Group of Latin American and Caribbean States (GRULAC), said that EOs should be treated in a more inclusive and transparent manner. It also said that it was ready to support an in-depth study, if the Latin American region is treated "on an equal footing" as the proposed five new EO offices.
 
[GRULAC wished to see the draft 2014/2015 Program and Budget include the establishment of an external office located in a Spanish-speaking country.]
 
Chile echoed the concerns raised by Trinidad and Tobago, adding also that it could not accept that the region was being discriminated against. It further said that part of the problem is that a discussion that should have been Member-driven has not been so.
 
Venezuela called for a review of all EOs, particularly their relevance and future prospects, adding that it was not clear why previous offices were created, were they pertinent and are they still pertinent.
 
India stressed that the process should be Member-driven and echoed concerns raised over transparency and inclusiveness, adding that there was a need to know the advantage of an EO for the organisation and the region.
 
On behalf of the Asian Group, India emphasised that the criteria and guidelines for the selection of EOs have to be determined with the involvement of Member States.
 
Iran said that the various divergent views indicated that the proposal on EOs was premature. It said that the Secretariat should provide information on what were the processes for engaging Member States, the mandate, legal status and accountability for the establishment of an EO. It also sought information on the 20 countries that had applied for EOs and how their request was processed.
 
Iran pointed out that it is for the (WIPO) General Assembly to take a decision on the establishment of EOs. It referred to Article 9 (4)(c), which states that the Director-General "shall report to, and conform to the instructions of, the General Assembly as to the internal and external affairs of the Organization" adding that "We think the point of departure for the discussion is the General Assembly. The PBC is not a competent body to discuss this issue".
 
Iran also supported Venezuela's call to review existing EOs of WIPO and have an in-depth study on the matter, adding that the study should look at the substantive, administrative and legal ramifications and should take a holistic approach, and that in the absence of a complete paper, conducive discussions cannot take place.
 
Iran warned the WIPO membership against making a "hasty decision", adding further that the decision to set-up EOs has a "political aspect" and a "political impact".
 
Algeria, on behalf of the Africa Group, supported the adoption of the Secretariat's proposal. However, in view of the concerns raised, it also supported the call for a study on EOs.
 
Discussion on the matter concluded with the adoption of the following decision: "The PBC further requested the Secretariat to prepare the following documents regarding the matter of external offices, emphasizing the Member driven nature of this process: (i) an information paper, including background documentation, to be circulated prior to the next session of the PBC, in response to questions and requests for further information made by delegations at the present session; and (ii) an in-depth study to address, in a comprehensive manner, all the issues related to this matter including those that were raised by delegations at the present session."