Geneva: World Trade Organization (WTO) members moved closer to a text-based process to address the proposals put forward by delegations aimed at improving the international response to COVID-19 and achieving the common goal of providing global equitable access to vaccines and other medical products. At the formal meeting of the Council for Trade-Related Aspects of Intellectual Property Rights (TRIPS) on June 8-9, 2021 members also addressed the continued exemption for least-developed countries (LDCs) from TRIPS obligations, currently set to expire on July 1, 2021.
In an extensive discussion with the participation of 48 delegations, members reiterated their well-known differences on where the emphasis should be placed to ensure their shared objective of a rapid and effective response to the pandemic. They expressed their willingness to engage constructively in a discussion based on two proposals tabled by members, namely the revised proposal for a waiver from certain provisions of the TRIPS Agreement, co-sponsored by over 60 delegations, and the communication from the European Union on urgent trade policy responses to the pandemic.
The co-proponents of the proposal to waive certain TRIPS Agreement obligations detailed the main points of their revised text. They stressed that the updated proposal takes into account the existence of virus mutations and new variants which have a significant impact on public health measures. It also underlines the importance of diversifying production and supply to increase access to vaccines and other medical products, and the need to preserve incentives for research and innovation. Co-proponents responded to concerns regarding the revised provision on the duration and termination of the waiver, seen by some members as a means to permanently waive various TRIPS Agreement obligations. They explained that the waiver would be in force for at least three years from the date of adoption, mandating the General Council to decide on the date of termination once the exceptional circumstances end.
Other members acknowledged the new phase of discussions would require a great deal of compromise to accommodate all views without losing sight of other elements necessary for a holistic response to the pandemic, such as addressing tariffs and export restrictions, trade facilitation and the role the WTO can play as a matchmaker between vaccine developers and manufacturers. These members agreed that extraordinary circumstances call for extraordinary and urgent measures and said it is time for the WTO to show it can step up in a global crisis and act effectively to improve the lives of ordinary people across the globe.
Several members expressed their support for the EU’s proposal, which calls for limiting export restrictions, supporting the expansion of production, and facilitating the use of current compulsory licensing provisions in the TRIPS Agreement, particularly by clarifying that the requirement to negotiate with the right holder of the vaccine patent does not apply in urgent situations such as a pandemic, among other issues. While recognizing that intellectual property rights (IPRs) should not stand in the way of deploying and creating capacity, or of ensuring equitable access to vaccines and therapeutics, these members stressed that this can be attained while maintaining IP as the basis for incentivizing investment in innovation, and for licensing technology transfer, so that members can effectively fight new strains of COVID-19 and any future diseases and pandemics.
The chair of the TRIPS Council, Ambassador Dagfinn Sørli of Norway, expressed his hope that in continuing urgent and focused discussions on the IP issues relevant to the pandemic, members will be able to agree on a pragmatic response to the COVID-19 crisis.
Delegations agreed on the urgent need for this discussion and called on the chair to facilitate an intensive process in various formats. The chair foresees an intensive schedule of meetings and consultations, beginning immediately after the TRIPS Council meeting, echoing the Director-General’s remarks that equitable access to medicines for COVID-19 is both the moral and economic issue of our time. The chair intends to consult members urgently on how the process can be arranged in practical terms, aiming at agreement on a report to the next General Council meeting scheduled for 21-22 July. This date presents itself as a natural target date for our efforts, he noted, warning that members need to be prepared for an intensive process in various formats which would likely require flexibility and compromise on all sides. Members will be called to a first informal meeting on June 17 to assess how textual discussions can move forward and to agree on the needed steps to be taken leading up to the General Council meeting in July.
Vaccine data compilation
In response to interest from members, the WTO Secretariat presented an initial compilation of data on the number of production arrangements under which vaccine developers had contracted vaccine manufacturing to other companies, and on the projected and actual production of COVID-19 vaccines under such agreements. The chair encouraged a continued collection and updating of such data to contribute to the TRIPS Council’s deliberations. Interest was also shown in reporting on the evolving patent landscape for COVID-19 related technologies.
LDC transition period
Despite broad agreement on the principle, consensus eluded members on securing a decision about a new extension to the transition period for LDC members under Article 66.1 of the TRIPS Agreement, which is set to expire on July 1, 2021. Since the inception of the TRIPS Agreement, LDCs have benefitted from an extended transition period to apply provisions of the TRIPS Agreement, in recognition of their special requirements, their economic, financial and administrative constraints, and their need for flexibility in order to create a viable technological base. The transition period has been extended twice (in 2005 and 2013).
The LDC group’s submission in document IP/C/W/668 seeks to extend the transition period for as long as the member remains categorized as an LDC, and for an additional period of 12 years from the date of graduation of a member from the LDC category. All delegations support the extension of the LDC transition period, but some expressed a preference for extending the period for a limited number of years, while others were concerned that a transition period for members that have graduated from LDC status went beyond the TRIPS Council’s mandate under Article 66.1.
Given the lack of consensus and the immediacy of the expiration date, the chair proposed to keep this issue open and to reconvene the TRIPS Council in formal mode on 29 June once an agreed decision appeared to be in reach. That may be the last chance to find a consensus, said the chair, who called on members to show flexibility and to focus on pragmatic approaches to address the issue before the expiry of the current transition period.
IP and innovation
Following up on past items on IP and innovation regularly added to the TRIPS Council agenda since 2012, the co-sponsors Australia, Canada, Chile, the European Union, Japan, Singapore, Switzerland, Chinese Taipei, the United Kingdom and the United States summarized the discussions under the 2020 theme of “Making micro, small and medium-sized enterprises (MSMEs) competitive through IP”.
The submission highlights examples provided during the discussions and reiterates how MSMEs — which play a crucial role in the global economy as key drivers of innovation, employment, growth, and trade — can make effective use of intellectual property rights (IPRs) to build their businesses. Under this theme, delegations exchanged experiences related to trademark protection outreach and the use of the trademark system for MSMEs; the development of IP management strategies for MSMEs, including combinations of IPRs, such as trade secrets, patents, and industrial designs; and how MSMEs can leverage IP to innovate, partner, and commercialize green technology.
At the proposal of Australia, Brazil, Canada, Chile, the European Union, Japan, Singapore, Switzerland, Chinese Taipei, the United Kingdom and the United States, members also addressed the topic of “IP and innovation: IP for investment/financing/funding” (IP/C/W/679). Co-sponsors invited members to engage in a discussion on how financing affects every stage of the innovation cycle, from idea creation to commercialization, expansion and long-term business sustainability. With untapped potential in financing for innovation, innovative and creative businesses can often find it difficult to use their existing or potential IP assets to unlock funding, particularly when compared with businesses that hold more conventional, tangible assets.
In order to guide this debate, members were asked to share their experience with businesses and other entities using IP to raise finance internationally. Also addressed was how TRIPS has influenced the flows of finance between countries, and what forms of IP-related measures have proven useful – and which ones have not – for the support of small enterprises in their financing/commercialization strategy.
Non-violation and situation complaints
Following the General Council decision of December 10, 2019 to extend the moratorium on the initiation of non-violation and situation complaints under the TRIPS Agreement until the 12th Ministerial Conference (MC12), scheduled to take place the week of 29 November 2021 in Geneva, members discussed how to approach the mandate to examine scope and modalities for such complaints and to make a recommendation to MC12.
This question concerns the longstanding discussion of whether — and under what circumstances — members should have the right to bring disputes to the WTO if they consider that another member’s action or a particular situation has deprived them of an expected benefit under the TRIPS Agreement, even if no specific TRIPS obligation has been violated.
In a repetition of previous discussions, some members reiterated their preference for continuing, or making permanent, the current moratorium. They consider there is no room for the application of non-violation complaints in the area of IP because of the legal uncertainty and curtailment of flexibilities that could ensue. Other delegations favoured ending the moratorium, arguing that non-violation complaints are key to maintaining a proper balance of rights and obligations within the TRIPS Agreement while helping to ensure legitimate obligations are not circumvented or avoided. Some members also noted the political linkage of this item with the related moratorium on customs duties on electronic transmissions – the e-commerce moratorium – also to be addressed at MC12.
The chair noted that there are now six months left before the Ministerial Conference and one remaining regular formal TRIPS Council meeting (in October) at which members could formulate concrete suggestions for a recommendation for MC12. Against that background, the chair encouraged members to engage with each other in the time remaining before MC12 and to try and find a way out of the deadlock that has stalled progress on this item for the last two decades.
TRIPS amendment
The chair reported that, since the last TRIPS Council regular meeting in March 2021, the delegation of Antigua and Barbuda deposited on 12 May 2021 its instrument of acceptance for the protocol amending the TRIPS Agreement.
To date, 133 members have accepted the TRIPS amendment, which entered into force on 23 January 2017, securing for developing countries a legal pathway to access affordable medicines under WTO rules. The chair encouraged the remaining 31 members to expedite action in good time before the current deadline for acceptance, which was extended until 31 December 2021.
Next meetings
After the resumption of the present session on June 29, the next formal meeting of the TRIPS Council is currently scheduled for October 13-14, 2021.
– global bihari bureau
