[Ip-health] Stop outrageous pressure by the US, EU, and WTO TRIPS Council Chair attempting to derail LDCs' Request to extend their TRIPS transition period

Baker, Brook b.baker at neu.edu
Tue May 21 05:23:04 PDT 2013


Colleagues

This is a communication sent to US and European negotiators and the WTO Secretariat decrying bad faith negotiations going on at the WTO with respect to least developed country Members request for an extension of their transition period within which to become TRIPS compliant.  The text of the separate letter from LDC Watch and Our World is not for Sale Network is pasted below as well.

Brook
Professor Brook K. Baker
Northeastern U. School of Law
Affiliate, Program on Human Rights and the Global Economy
400 Huntington Ave.
Boston, MA 02115 USA
Honorary Research Fellow, University of KwaZulu Natal, Durban, S. Africa
Senior Policy Analyst Health GAP (Global Access Project)
(w) 617-373-3217
(cell) 617-259-0760
(fax) 617-373-5056
b.baker at neu.edu

Dear Ambassador Punke and Colleagues,
   I am writing to share our deep concern over the current negotiations on the TRIPS exception for Least Developed Countries--the world's most economically vulnerable countries. Below is a civil society statement and a separate open letter from LDC Watch and the Our World is not for Sale Network regarding the conduct of these negotiations. We are deeply disturbed by reports that the U.S. and E.U. are allowing only a few years extension, are demanding a "standstill" provision that locks in place colonial-era/ill advised laws, as well as language requiring implementation of TRIPS in LDCs while they are still "least developed."  TRIPS Article 66.1 states that an extension "shall" be granted--on what grounds is the U.S. then demanding conditions?
   As you are aware, there is no empirical evidence that the IP standards embodied in TRIPS will promote development or innovation in LDCs, but significant evidence that they will inhibit development by raising the price of medicines, climate technologies, and educational materials.  When the U.S. was a developing country, we strategically refused to enforce patents on essential technologies as part of long-term development strategy. Why, then, is the U.S. government pushing the world's poorest countries into foreclosing the same?

We hope the U.S. and developed-country partners will reverse course and ask for your immediate attention to the matter.

Thank you.

Matthew Kavanagh

Statement on Unethical Strong-Arming of LDCs By “Developed” Countries at the WTO

The US and EU are playing an unprincipled, tag-team game of coercion at the World Trade Organization against the legitimate request of Least Development Country members to be granted an extension of the transition period, within which they must become compliant with the WTO TRIPS Agreement on intellectual property. Despite the TRIPS agreement's mandate that this extension "shall" be granted, the US and EU are demanding onerous conditions.

   Formally, the US and EU say that they do not yet have official policies on the LDC extension request.  Nonetheless, they met three times with LDCs last week, and multiple times previously, trying to bully LDCs out of what they are legally entitled to – mandatory granting of a further extension of the transition period upon proper request.

    The EU and US negotiators are asking the same questions and making the same demands over and over again, ultimately trying to force LDCs to capitulate: "Why can't you accept a standstill clause - you did before;" "Why do you need a longer rather than a shorter extension;" "If you want to weaken the no–rollback clause, you have to shorten your extension request."  Instead of going on the record with their unreasonable demands, powerful US and EU negotiators in Geneva are using one of the classic bad faith tactics: they are trying to bully LDCs into submission with the unauthorized threat of a veto—one they don't actually have under Article 66.1, which states that extensions "shall" be granted.

    The Chair of the TRIPS council, the Panamanian ambassador, is unfortunately playing a very unprincipled role.  He is refusing to include other developing countries like India, Brazil, and South Africa in the negotiating sessions while allowing the US, EU, Canada, Japan, the Swiss, New Zealand and Australia to take turns in verbally torturing the small LDC contingent. In addition, the Chair is allowing demands only to be made against the LDC request without requiring that the US and EU explicitly state the reasons for their opposition and defend them.  Thus, the US and EU can continue the pretense that they are in favor of the extension when they really oppose it. Several of the most recent proposals are quietly yet unequivocally aimed at requiring LDCs to adopt TRIPS rules even though wealthy countries have completely abrogated their development and technology transfer obligations.

    Why they oppose it, at least in terms of pure economics is a mystery.  LDCs collectively are extremely poor and are the home to 50% of the poorest people in the world.  They cannot afford monopoly prices on IP protected goods and their governments can't afford costly administrative procedures set up solely to protect IP monopolies for foreign multinationals. From medicines to climate change mitigation technologies to educational materials would all be placed out of reach by the policies the US and EU are trying to strong arm LDCs into adopting.

    The only real answer is IP fundamentalism.  The drug, movie, publishing, and agricultural businesses in rich countries have their governments tied around their finger.  They have to win every battle, even against the poorest people on earth, to vindicate their vicious hold on monopoly profits.

    The bullying continues on Tuesday May 21.  LDCs need support from other developing countries and exposure of the bad faith tactics by the US, EU, and the Secretariat of the WTO.  With added support and a spotlight on rich country malfeasance, hopefully LDCs can win that to which they are absolutely entitled—an unconditional extension of their TRIPS transition period until they are no longer LDCs.

Explanation of the LDC Extension Request:

    Least developed country Members of the WTO have offered a duly motivated request for an unconditional extension of the transition period within which they must become fully compliant with the TRIPS Agreement.  Their request is elegantly simple and straightforward and is entirely consistent with the spirit and letter of Article 66.1 of the TRIPS Agreement.

    First, they request an extension that is not burdened by an unauthorized standstill/no-rollback provision, which would require them to maintain existing levels of compliance with TRIPS standards. LDCs all have a variety of IP protection mechanisms--many imposed by past colonial powers or adopted pursuant to the warped technical assistance offered by WIPO and other technical agencies. A standstill provision locks those in place. While no LDC is proposing doing away with IP, there are strategic areas where exceptions, limitations, and pro-development policy space is needed—the very kind of policies today’s rich countries used to industrialize.

    A standstill clause was improvidently granted in 2005 when LDC Members sought their first full extension of the LDC transition period. LDCs were coerced or tricked into adopting a standstill provision that had only been authorized by TRIPS Article 65.5 with respect to non-LDC developing country Members for their shorter, non-extendable transition periods.  LDC Members are rejecting that approach this time, seeking to maintain the policy space they may need to undo implementation, application, and enforcement of some IP rules if and when they conclude that that is in their national interests to do so, taking into account their weak technological and institutional capacities.

    Given strong evidence that heightened intellectual property rights and enforcement mechanisms are not associated with technological advancement, foreign direct investment, or development more broadly, LDCs are making a very wise choice to regain the sovereignty needed to alter overly broad IP shackles. Evidence shows that in LDCs these rules have mainly benefitted IP rights-holders from rich countries and have resulted in unaffordable prices for many essential public goods including medicines, educational resources, and green technologies.  Second, LDCs request an extension that lasts as long as a particular LDC Member remains an LDC—a UN classification for the lowest-income, most economically vulnerable states.  Again they have offered a compelling rationale:  Their individual and collective conditions remain substantially unchanged – they have fallen even further behind in terms of their technological base since the WTO agreements were signed and they have yet to overcome crushing capacity constraints that negatively impact their economic and social development.  Short extensions, even when tacked together, do not provide sufficient time to overcome inherited, structural deficits.

    Without a tie between successful development efforts (i.e. graduation from LDC status) and implementing TRIPS, short extensions provide no room to implement exactly the kind of medium-term industrialization strategies that the US and the EU benefitted from. Meanwhile, the high cost of IP-protected monopoly priced goods drains scarce foreign currency reserves and undermines key government investments in infrastructure, capacity-building, and social services.  The path to more sustainable development for LDCs is long and hard, and they should have the security of an exception from IP mandates when and where they feel that such a choice is in their best interests.
An Open Letter to the Chair of the Council on Trade Related Intellectual Property Rights (TRIPS): Alfredo Suescum, Ambassador of Panama to the World Trade Organization (WTO)

Dear Ambassador Suescum,

We are outraged with the manner in which informal consultations are being conducted on the issue of extension of the LDC’s transition period. We find the current process to be unfair and prejudicial to the interests of the LDCs, the poorest and most vulnerable segment of the international community.

The LDC’s request has obtained extensive support from the developing world but the supporters of the LDC’s request have not been invited to participate in the current on-going consultations. Instead, the consultations have been limited to developed countries (that are opposed to the LDCs request) and to the LDC Group. It is outrageous that developing countries that have supported the LDC request (which together with the LDCs form the vast majority of actual members of the WTO), are being prevented from participating in the consultations. As a result you are depriving LDCs of their allies, while attempting to overwhelm the negotiating capacity of the poorest members of the WTO by placing them in an unfair position where they have to face the united might of the developed countries. Clearly the consultations have been designed so that the outcome will fail the LDCs.

In addition, the LDC request for an extension of the transition period to defer implementation of the TRIPS agreement has been made as per Article 66.1 which states WTO members SHALL grant an extension once LDCs submit a “duly motivated request”. Thus, developed countries are in violation of WTO rules even to demand negotiations to the terms of the extension decision. We refer you to a letter<http://www.infojustice.org/archives/29438> sent by 130-plus legal and other academics from high-, middle-, and low-income countries who specialize in international intellectual property and trade law, development studies, human rights, and other related disciplines which reiterates this legal mandate. It is a violation of your supposedly “neutral” role as the Chair to allow for negotiations to occur, when adherence to the rules-based system would necessitate that you facilitate the granting of the extension as requested by the LDCs in their duly motivated request IP/C/W/583, as mandated by Article 66.1 of the TRIPS agreement.

Further, we find it is unconscionable that you are enabling negotiations of conditionalities in the extension decision, which will greatly minimize or nullify the benefit of the transition period. Developed countries are demanding that LDCs agree not to dismantle any existing TRIPS-complaint legislation, through a variety of convoluted language options. Such demands are illegitimate as they alter the nature of rights LDCs are entitled to during the transition period and conflict with Article 66.1. We are also concerned that the consultations are facilitating developed countries’ blatant disregard of the rationale of the transition period that is explicitly stated in Article 66.1 of TRIPS (i.e. to provide flexibility to LDCs to overcome their contraints and to develop a viable technological base) and accomodating language that will commit LDCs to become TRIPS compliant irrespective of their capacities and technological development.

We would like to stress that as the Chairman of the TRIPS Council, you have a solemn duty to ensure that the terms of the extension decision do not violate WTO rules or conflict with the rationale and the full rights LDCs are entitled to under Article 66.1 of the TRIPS Agreement.

We also reiterate that the LDC request has received massive support from all segments of society. Apart from strong support developing countries advocated at the last TRIPS Council meeting,[1]<applewebdata://8F8A761A-A1B2-4BE2-8112-1D6F949636B9#_ftn1> many civil society groups (representing millions)[2]<applewebdata://8F8A761A-A1B2-4BE2-8112-1D6F949636B9#_ftn2>, industry[3]<applewebdata://8F8A761A-A1B2-4BE2-8112-1D6F949636B9#_ftn3>, academics[4]<applewebdata://8F8A761A-A1B2-4BE2-8112-1D6F949636B9#_ftn4>, UN agencies[5]<applewebdata://8F8A761A-A1B2-4BE2-8112-1D6F949636B9#_ftn5> have also firmly supported the approval of an unconditional extension of the transition period for as long as a country remains a LDC. They have rejected the notion that implementation of the TRIP Agreement benefits LDCs and supported LDCs’ right to roll back existing intellectual property rules should they be adverse to their needs and interests.

They have also supported that the duration of the extension be for as long as LDCs remain LDCs as their conditions are terribly poor. For example more than half of the LDC population lives on less than $1.25 (PPP) per day; adult literacy rate in LDCs is on average at 60.7%, with gross enrolment in tertiary education at about 6.6% while primary school dropout rate at 40.9 % of the population; only 1.7 per 100 people have personal computers, while about 5 out of 100 have access to the worldwide network; more than half of the LDC population do not have access to electricity, water or sanitation facilities. The productive capacities in LDCs are also extremely limited and they tend to be at the bottom of all innovation/technology indices. These conditions suggest that the proposed time-frame is not only practical but also necessary. Short time-frames such as that currently proposed by developed countries (e.g. 5 years) cannot be the basis of the consultations. We stress that it is your duty to ensure that the LDCs are extended the time-frame they have requested.

Finally we specifically refer to you the letter sent on 21st February, 2013 by 376 civil society organizations from nearly every member of the WTO, demanding that WTO members immediately grant the extension as requested by the LDCs, without conditionalities. On behalf of those 376 organizations and their hundreds of millions of members across the globe, we demand that you immediately cease facilitating the bullying of the LDCs in the TRIPS negotiations, and instead facilitate the immediate and unconditional granting of the extension, as requested by the LDCs.

Sincerely,


Our World Is Not for Sale (OWINFS) network                     LDC Watch


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[1]<applewebdata://8F8A761A-A1B2-4BE2-8112-1D6F949636B9#_ftnref1> See http://www.twnside.org.sg/title2/intellectual_property/info.service/2013/ipr.info.130301.htm and http://www.ip-watch.org/2013/03/06/wto-wide-support-for-ldc-trips-transition-extension-with-a-hitch/

[2]<applewebdata://8F8A761A-A1B2-4BE2-8112-1D6F949636B9#_ftnref2> See Civil Society Letter at http://www.ip-watch.org/weblog/wp-content/uploads/2013/02/CSO-Letter-Supporting-Extension-of-LDCs-Transition-Period.pdf and See Statement of Electronic Information for Libraries (EIFL) at http://www.eifl.net/eifl-statement-support-lcd-trips-waiver.

[3]<applewebdata://8F8A761A-A1B2-4BE2-8112-1D6F949636B9#_ftnref3> See statement by Computer & Communications Industry Association (CCIA) at http://www.ccianet.org/?sid=5&artid=363&evtflg=False

[4]<applewebdata://8F8A761A-A1B2-4BE2-8112-1D6F949636B9#_ftnref4> See Global Academics Letter to WTO Members on TRIPS Extension at http://infojustice.org/archives/29370

[5]<applewebdata://8F8A761A-A1B2-4BE2-8112-1D6F949636B9#_ftnref5> See http://www.unaids.org/en/resources/presscentre/pressreleaseandstatementarchive/2013/february/20130226prtrips/ and http://www.unaids.org/en/media/unaids/contentassets/documents/unaidspublication/2013/JC2474_TRIPS-transition-period-extensions_en.pdf

Professor Brook K. Baker
Northeastern U. School of Law
Affiliate, Program on Human Rights and the Global Economy
400 Huntington Ave.
Boston, MA 02115 USA
Honorary Research Fellow, University of KwaZulu Natal, Durban, S. Africa
Senior Policy Analyst Health GAP (Global Access Project)
Alternate NGOs Board Member UNITAID
(w) 617-373-3217
(cell) 617-259-0760
(fax) 617-373-5056
b.baker at neu.edu



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