[Ip-health] WTO TRIPS Council (February 2014) - India's intervention on Non-Violation and Situation Complaints

Thiru Balasubramaniam thiru at keionline.org
Wed Feb 26 09:44:05 PST 2014


Submitted by thiru <http://keionline.org/user/6> on 26. February 2014 -

For non-trade specialists, a 'non-violation complaint' at the WTO
effectively amounts to a complaint that a country has violated the spirit
but not the letter of trade law. While countries can launch such disputes
at the WTO for trade in goods and services, there is a moratorium on doing
so over intellectual property rights. For many WTO members, the application
of non-violation and situation complaints to the TRIPS Agreement, as
advocated by Switzerland and the United States of America, represent a
stealth attack on WTO members' sovereign right to use TRIPS flexibilities
such as compulsory licensing to safeguard health and promote access to
medicines for all. On Tuesday, 25 February 2014, India delivered the
following statement at the WTO TRIPS Council on Non-Violation and Situation

In October 2013, the WTO Secretariat provided the following
the TRIPS Council's consideration of non-violation and situation complaints:

Complaints about countries being deprived of expected rights -- such as
access to export markets -- even when no WTO rules or commitments have been
violated, can be lodged as formal legal disputes for trade in goods and
services. But members disagree about whether complaints of this kind would
be possible in intellectual property. Broadly, the US and Switzerland argue
that non-violation complaints are possible in TRIPS; most other members
disagree, but some have said they want to consider how non-violation
complaints might be handled.

Members compromised by writing into the 1995 TRIPS Agreement a five-year
"moratorium", ie, an agreement not to bring non-violation cases in TRIPS in
the period 1995-99 (Article 64.2). This has been extended from every
ministerial conference to the next since then.

In May 2003, the TRIPS Council chairperson listed four possibilities for
dealing with the moratorium. The present chairperson has indicated a
similar set four possibilities will be discussed next year:

   - banning non-violation complaints in TRIPS completely (as would happen
   if no further extensions are agreed)
   - allowing the complaints to be handled under the WTO's dispute
   settlement rule,s as applies to goods and services cases
   - allowing non-violation complaints but subject to special "modalities"
   (i.e. ways of dealing with them)
   - extending the moratorium (or making it permanent)

It should be noted the 9th WTO Ministerial Conference held in Bali,
Indonesia (3-7 December 2013) issued the following declaration on TRIPS
Non-Violation and Situation Complaints.

We take note of the work done by the Council for Trade-Related Aspects of
Intellectual Property Rights pursuant to our Decision of 17 December 2011
on "TRIPS Non-Violation and Situation Complaints" (WT/L/842), and direct it
to continue its examination of the scope and modalities for complaints of
the types provided for under subparagraphs 1(b) and 1(c) of Article XXIII
of GATT 1994 and make recommendations to our next Session, which we have
decided to hold in 2015. It is agreed that, in the meantime, Members will
not initiate such complaints under the TRIPS Agreement.

In the context of Pharmagate <http://keionline.org/node/1908> in South
Africa and an orchestrated campaign of
 by PhRMA, the US Chamber of Commerce, BIO, IPO and
these remarks are timely. If non-violation and situation complaints were
applied to the TRIPS Agreement, one wonders how this would affect the
implementation of tobacco plain packaging measures in Australia, New
Zealand, Ireland and Scotland.

Intervention on Non Violation and Situation Complaints

At the outset let me thank the WTO Secretariat for their factual and
comprehensive briefing on the applicability of the Non Violation and
Situation Complaints to the TRIPS Agreement. In fact after listening to the
briefing and to the interventions made by the delegations of the US and
Switzerland, under this Agenda item, our concerns on this issue remain
unaddressed and we are convinced that such complains should be banned
completely. Despite highlighting the systemic and specific concerns through
the communication IP/C/W/ 385 of 2002, it is regretted that the proponents
have not made any attempt to address the issues raised in our
communication. As regards future work on this issue, since it is already
reflected on the Agenda item of every TRIPS C meeting, it would be useful
to discuss the issue in the formal meetings of the TRIPS Council.

For my delegation, the application of non-violation and situation
complaints to the TRIPS Agreement raise fundamental concerns. Such
complaints would not only introduce incoherence between WTO Agreements but
would upset the carefully established balance of rights and obligations in
the TRIPS Agreement by elevating the private rights over the interests of
the users of the intellectual property- both within and between the
countries. We also believe that application of non violation complaint to
any general, non negotiated obligations, such as in TRIPS Agreement, may
have the effect of creating new non negotiated responsibilities. Unlike
Tariff bindings, obligations under TRIPS cannot be revised as between
individual parties. Consequently the non violation remedy may allow the
Member claiming non violation to expose the impairing Member to the threat
of retaliatory actions equivalent to those of violation complaints. Again
the creation of un-negotiated obligations is inconsistent with Art 3.2 of
the DSU which provides that the rulings of the DSB must not add or diminish
the rights and obligations provided in the covered agreements.

Chair we are concerned that the application of non violation complaints
would not only threaten to undermine regulatory authority but would
infringe the sovereign rights. Thus, Members' rights to introduce new and
vital socio-economic, health, environmental and cultural measures including
the measures on the basis of the Doha Declaration on Public Health would be
severely curtailed and would chill the enjoyment of WTO Members' sovereign
right to develop new laws to protect public interest. Any measure under
Article 8 would thus encourage unilateral pressure and speculative claims
to force countries to raise protection beyond minimum requirements or to
refrain from using TRIPS consistent measures like Compulsory Licenses to
ensure access to medicines or guarantee access to some technology.
Unfortunately the non violation complaints will make it harder for Members
to rely on agreed text of the TRIPS Agreement.

Further extending the scope of non violation is unnecessary to protect the
balance of rights and obligations inherent in the TRIPS Agreement, the
market access commitments in other agreements or any other balance inherent
in the Uruguay round package. Thus unlike GATT and GATS, since the TRIPS
Agreement does not involve an exchange of concessions, we fail to
understand how non violation complaints would apply to minimum regulatory
standards that protect private rights.

Chair there is also a great deal of uncertainty as to the nature of
benefits that would be addressed through this remedy. The benefits to the
members have been mentioned in the Preamble, Objectives and Principles of
the Agreement and include

   - Measures and procedures to enforce IPRs do not become barriers to
   legitimate trade.
   - Promotion of technological innovation and transfer and dissemination
   of technology.
   - Mutual advantage of producers and users of technological knowledge
   - Socio economic welfare and so on. Any relevant benefit must accrue to
   the Member and not to private entities. Art 23 of GATT and Art 26 of the
   DSU are applicable to Members and should not be conflated with the benefits
   to a private right holder.

Finally there is insufficient guidance including in Art 26 of the DSU and
in GATT Dispute practice for panels and Appellate Body to apply such
complaints in the context of the TRIPS. With just three non violation
complaints being adopted in the entire history of GATT, there is very
little guidance on this issue. Thus when the Panel or an Appellate Body is
requested to make a ruling on a legal measure that may have impaired
benefits accruing under TRIPS, they would be facing a normative void which
cannot be filled by judicial fiat.

Let me conclude by saying that the proponents need to seriously reflect
over the concerns expressed through the communication IP/C/W/385 of 2002 ,
and in the interest of the stability and certainty of the multilateral
system they should join the consensus in banning the non violation and
situation complaints completely.

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