[Ip-health] LDCs collectively request an indefinite extension of their TRIPS-compliance transition periods

Madhavi Sunder msunder at ucdavis.edu
Tue Nov 13 12:36:17 PST 2012


Sorry, I am joining this debate late, but when Professor Mercurio writes that "it is clear that freedom from patents simply has not had any pro-developmental effects," we must ask how you are defining development. For some time now international actors have not defined development purely on the basis of GDP, but rather by assessing human capabilities. On that score, poor countries having the freedom to either make or access cheap copies of patented drugs saves and improves human lives.  Your argument about GDP wholly misses this point.

Madhavi Sunder
Professor of Law and Martin Luther King, Jr. Hall Research Scholar
University of California, Davis
400 Mrak Hall Drive
Davis, CA  95616
(530) 752-2896
My website: msunder.com
Buy my book, From Goods to a Good Life: Intellectual Property and Global Justice (Yale University Press 2012)

-----Original Message-----
From: ip-health-bounces at lists.keionline.org [mailto:ip-health-bounces at lists.keionline.org] On Behalf Of Bryan MERCURIO (Faculty of Law)
Sent: Tuesday, November 13, 2012 8:18 AM
To: Baker, Brook; Ip-health at lists.keionline.org
Subject: Re: [Ip-health] LDCs collectively request an indefinite extension of their TRIPS-compliance transition periods

Thank you again for the comments. LDCs have for decades been able to freely copy the patents of the world, but alas this has not lifted them to developing country status. While it may be questioned whether IPRs are pro-development (and I for one would greatly appreciate more economic studies on the subject), it is clear that freedom from patents simply has not had any pro-developmental effects. The problem is much deeper. We often use the term 'policy space' and focus on the 'space' but it is time we also pay attention to the 'policy'.

-----------------------------------
Bryan Mercurio
Professor of Law and Associate Dean (Research) The Chinese University of Hong Kong Shatin, NT HONG KONG
Tel: +852 3943 1139
Faculty webpage: http://www.law.cuhk.edu.hk/people/mercurio-bryan.php
SSRN author page: http://ssrn.com/author=346439



-----Original Message-----
From: Baker, Brook [mailto:b.baker at neu.edu]
Sent: Tue 2012/11/13 12:46
To: Bryan MERCURIO (Faculty of Law); Ip-health at lists.keionline.org
Subject: RE: [Ip-health] LDCs collectively request an indefinite extension of their TRIPS-compliance transition periods
 
Thanks back to Prof. Mercurio for explaining his operating assumptions even more clearly.  While I certainly agree that developed countries wanted to push IP harmonization in the original TRIPS Agreement, I wonder whether they did so in order to help the development prospects of LDCs (and other developing countries) or whether they wanted to be in the position to ensure monopoly rents for their newly globalized IP right holders. I believe that the later interpretation is more accurate.

But even though developed countries sought to expand IP empires, Article 66 seems to contain greater support for an IP moratorium for LDCs than Prof. Mercurio acknowledges.  As I read Art. 66, it is not simply saying that LDCs need 10 years to consolidate capacity to adopt and enforce TRIPS standards.  It specifically references a gaping lack of technological and other capacities.  To address these gaps, Art. 66 gave developing countries complete freedom for 10 years to eliminate any and all IP protections, except to preserve national treatment and most favored nation principles if they were to have any IPRs whatsoever.  Moreover, it is inaccurate the interpret Art. 66 as providing for only a single 10-year moratorium because it gives LDCs unequivocal rights to additional extensions based on properly motivated requests.  At a theoretical level, that right to an extension is absolute.

Where I probably agree much more with Prof. Mercurio is that the political reality is that developed countries will oppose an unlimited extension and will seek a shorter time period.  In addition, developed countries might request different IPRs are treated differently.  They are certain to seek a no-roll-back clause, even though one is not required under Art. 66.1.

But the question is should LDC and their supporters merely accede to prospective rich country demands or should they stand up and fight against them in order to meet LDCs real needs.  LDCs need policy space not to expend scarce resources on becoming TRIPS compliant and resourcing IP enforcement capacity but instead to focus their attention on addressing many of their unique development dilemmas.  They will be supported if academics and others expose the false IP-leads-to-development myth.

Finally, developed countries reciprocal obligations under Art. 66.2 to actually ensure technology transfer rarely get mentioned.  To date technology transfer has been a false promise.  LDCs are being urged to exchange that false promise for another one - the illusory claim that IPRs will themselves lead to tech transfer and to a blossoming of local invention and creative activity.

I hope we understand that this is not merely an "academic" debate.  Instead it is a debate with profound real world consequences.  We should collectively support the request for an unconditional and open-ended LDC extension.

Professor Brook K. Baker
Health GAP (Global Access Project) &
Northeastern U. School of Law, Program on Human Rights and the Global Economy Honorary Research Fellow, Faculty of Law, Univ. of KwaZulu Natal, SA
400 Huntington Ave.
Boston, MA 02115 USA
(w) 617-373-3217
(c) 617-259-0760
(f) 617-373-5056
b.baker at neu.edu
________________________________
From: Bryan MERCURIO (Faculty of Law) [b.mercurio at cuhk.edu.hk]
Sent: Monday, November 12, 2012 8:19 PM
To: Baker, Brook; Ip-health at lists.keionline.org
Subject: RE: [Ip-health] LDCs collectively request an indefinite extension of their TRIPS-compliance transition periods


I thank Prof. Baker for reading - and more importantly commented on - my paper. It is appreciated. His post makes it apparent to me that we need to refine the introduction so as to make the aims and conditions under which we are writing this piece more clearly stated. We start with the premise of attempting to find a workable, feasible and acceptable position to all parties. Quite simply, it is unrealistic to think that certain developed country members are going to accept indefinite deferral of TRIPS obligations. Second, and addressing Prof Baker's concern, we also accept for the purposes of the paper the thinking of the WTO that IPRs and development to some degree go hand in hand.

My main point of contention with Prof Baker is his statements that "Art. 66.1 represents a shared understanding that IPRs and their enforcement can stand in the way of LDC's industrial and human development" and "Art. 66.1 represents a shared understanding that IPRs and their enforcement can stand in the way of LDC's industrial and human development".

In fact, I do not think it is "clear" at all what Art 66 represents. If Prof Baker's view is correct, then why did the drafters provide a 10 year time period for a transition to TRIPS? Prof Baker's position seems to be that there was a recognition that LDCs should not have any obligation to protect IPRs. While the Uruguay Round negotiators can in many ways be accused of being naive, they certainly weren't silly enough to believe that each and every LDC would graduate to developing country status within a 10 year period. Moreover, if Prof Baker's position reflects the reality then why did the negotiators not simply Art 66 and simply provide that LDCs will not have any TRIPS obligations? Full stop/period. I cannot see how one can read "for a period of ten years" as stated in Art 66.1 as meaning a shared understanding that IPRs stymie development (and moreover that this is not a promise to eventually comply). What seems clear is that it says ten years! While some want to believ!
 e there was a shared understanding regarding LDC obligations, I do not believe this to be the case. I believe that everyone simply realised that LDCs were not in a position to protect IPRs and obligating them to do so would merely result in mass non-compliance.

Going back to the focus of the paper, since the WTO and many of its Member States espouse the view that IPRs are development-friendly we have attempted to work within the existing perimeters to develop a model for a future agreement. In so doing, we have tied the often-neglected developed country obligation to provide technical cooperation to the extension so as to not only burden LDCs with obligations. This may or may not be the best way forward, and as negotiations continue an indefinite extension may indeed be seen as a feasible alternative. I am therefore equally as happy for proponents of an indefinite extension to use our paper to further their position. Where we all agree is that the mid-2013 deadline cannot be reached without some form of further extension.

Thank you again for your comments, which will indeed help improve the quality of the paper.


-----------------------------------
Bryan Mercurio
Professor of Law and Associate Dean (Research) The Chinese University of Hong Kong Shatin, NT HONG KONG
Tel: +852 3943 1139
Faculty webpage: http://www.law.cuhk.edu.hk/people/mercurio-bryan.php
SSRN author page: http://ssrn.com/author=346439



-----Original Message-----
From: Baker, Brook [mailto:b.baker at neu.edu]
Sent: Tue 2012/11/13 03:09
To: Bryan MERCURIO (Faculty of Law); Ip-health at lists.keionline.org
Subject: RE: [Ip-health] LDCs collectively request an indefinite extension of   their TRIPS-compliance transition periods

Professor Mercurio and his co-author, Arno Hold, have presented an interesting and detailed history of the LDC extension, but their policy recommendations are unfortunately problematic.

Most fundamentally, Professor Mercurio and Research Fellow Hold seem convinced that the adoption of TRIPS-level IP protections is essential to the development of a viable technological base in LDCs and thus to their development and broader and more successful integration into the international economy.  Thus, they write:  "More generally, another unconditional extension would undermine the credibility of a multilateral system which is premised on the belief that the protection and enforcement of IPRs are beneficial for the growth and development of Members, including LDCs."

However, the TRIPS Agreement Art. 66.1 clearly acknowledges that the entire international community understood in 1995 that IPRs actually might stand in the way of LDCs developing a technological base and of increasing capacity in key areas.  That conclusion is based on an implied recognition that most LDCs will have to undergo a period of copying and adapting technological advances in the same way that virtually all now developed (rich) countries did during their own historical development process.

More specifically, Art. 65 of TRIPS treated the TRIPS compliance of middle-income developing countries far differently than LDCs were treated in Art. 66.  First, developing countries were given a shorter transition period (5 years vs. 11 years); second, developing countries had a no roll-back rule and LDCs didn't, which meant LDCs could prior to 2006 have de-legislated all IP protections in their countries for the duration of original transition period; and third, LDCs were given unconditional rights to both request and receive further extensions of the transition period upon a properly motivated request.

At its most fundamental level, Art. 66.1 represents a shared understanding that IPRs and their enforcement can stand in the way of LDC's industrial and human development.  (Of course, IPRs also stand in the way of affordable access to IP-protected commodities because IP-based monopolies result in high prices typically aimed at scarce economic elites only.)  Accordingly, Art. 66.1 should not be read merely as a promise that LDCs will eventually adopt TRIPS, but rather as a recognition that premature TRIPS implementation can and will retard development.

Accordingly, the four policy recommendations that Mercurio and Hold develop and their argument against the desirability of a further unconditional and long-term extension of the LDC transition period is, in my opinion, plainly wrong.  Technological development has not yet occurred and the path to developing a minimum technological base let alone "catching up" is uncertain at best.  Moreover, IPRs and their enforcement stand in the way of the classical approach to technological development - copying and adapting to local needs.

Rather than concentrating on assessing technical assistance needs for securing premature TRIPS compliance, LDCs should maintain their recent stand to win an unconditional and open-ended extension of the LDC transition period and thus be free to turn their attention to their real needs.  Those needs do not include ensuring monopoly protections for foreign IP innovators and creators, but rather to develop their own technological and capacity base and to develop a locally specific policy for encouraging innovation and cultural creation among their own people.

Professor Brook K. Baker
Health GAP (Global Access Project) &
Northeastern U. School of Law, Program on Human Rights and the Global Economy Honorary Research Fellow, Faculty of Law, Univ. of KwaZulu Natal, SA
400 Huntington Ave.
Boston, MA 02115 USA
(w) 617-373-3217
(c) 617-259-0760
(f) 617-373-5056
b.baker at neu.edu

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