by Chakravarthi Raghavan

Geneva, 30 June 2000 -- The attempts of developing countries to extend the protection of geographical indications of origin to products other than wines and spirits or excluding from patentability life forms has been stoutly opposed by the United States and some of its close friends in the Cairns and Miami groups.

These issues came up at this week’s meeting of the TRIPS Council of the World Trade Organization where the issues of review of Art. 27.3 (b), relating to patentability of life forms, and Articles 22 and 23 relating to multilateral system of registration and notification for geographical indications of origin for wines and spirits and extending that protection to other products.

The meeting was not even taking up negotiations on these issues, but merely trying to move to focused discussions, through a check-list of issues, that could lead to agreed conclusions or understandings.

Both the issues relating to patentability of life forms and protection of geographical indications of origin are mandated for review by the Marrakesh agreement.

Other questions that came up at the meeting, where the US took an equally negative view included the issue of non-violation complaints under TRIPS and the mandate to the TRIPS to review and make recommendations to the Ministerial Conference on scope and modalities for such disputes.

Under the TRIPS dispute settlement provisions (applying the provisions of Art. XXII and XXIII of GATT 1994), Article 64.2 set a 5-year moratorium on ‘non-violation’ disputes under the TRIPS Agreement - disputes where the complaint is not of failure to carry out obligations (as a result of national laws or regulations), but ‘application of any measure’ whether or not it conflicts with the provisions of the agreement or the ‘existence of any other situation.’

When the Marrakesh agreement, and the TRIPS part of it was being negotiated, a number of countries underscored the view that the GATT practice and precedents for traditional ‘non-violation’ complaint route of the GATT had been in the context of market access concessions (negotiated and bound tariffs) that were frustrated by other measures.  The TRIPS agreement by its nature could not involve such complaints.

As a compromise to enable agreement, the provision was inserted about the non-violation route not being available for 5 years from date of entry of TRIPS, and for the issue being carefully studied by the WTO.

Article 64.3 of the agreement provides that during the 5-year period of moratorium under Art. 64.2, the TRIPS Council “shall” examine the scope and modalities for such complaints and submit its recommendations to the Ministerial Conference for approval. Such recommendations or extending the period of the moratorium is to be by consensus.

The US has been blocking consistently, and in the run-up to Seattle, any possible recommendation for extending the moratorium on non-violation beyond the initial five years. Not only the developing countries, but other major trading partners like the EC and Canada had been arguing that there was no scope for non-violation complaint in an agreement like TRIPS.

After Seattle, the US has taken the position that the moratorium set by Art. 64.2 has ended and nothing more could be done. As for Art. 64.3, it has now taken the position that the period set for the TRIPS Council to review and make recommendations is over and there is nothing further to be done.

The US is also now taking the position that TRIPS is a ‘market access’ agreement, and dealing with non-tariff barriers (like the Technical Barriers to Trade Agreement) and thus amenable to ‘non-violation complaints’.

The EC in a paper on the issue has suggested that the Council undertake the mandated examination under Art. 64.3 and setting out the conditions under which it could be invoked. The EC paper makes the point that the TRIPS is not a ‘market access’ agreement though some aspects of laws and regulations of a country under TRIPS may have an indirect impact on market access.

At the TRIPS Council, the US advanced the argument that the time-period set in Art. 64.3 is over, and no recommendations have been made and that was the end of it.

The Philippines said this seemed a strange legal position of the US.

Article 64.3 set a legal obligation on the TRIPS to examine the scope and modalities of the non-violation complaints and make recommendations. If the US position that this obligation was over once the time-period had elapsed was correct, countries that had the obligation to implement the TRIPs by 1 Jan 2000, but had not done so, had no more obligation to do this.

As one diplomat present put it, the US was embarrassed and red-faced but had no answer to this.

Earlier, the Council agreed to give the World Health Organization on an ad hoc basis observer status at the TRIPS Council.

But the United States objected to India’s suggestion, supported by Brazil and Egypt to provide similar status to the secretariat of the UN Convention on Biological Diversity (CBD).

The US position appeared to be that the CBD provisions did not have any major trade interest, and in fact conflicted with the WTO provisions under TRIPS.

India and other developing countries however suggested that the US should give some more thought to the issue. India and a number of countries have already raised at the TRIPS Council, the Committee on Trade and Environment, and under implementation, issues relating to the conflicts between the provisions of the TRIPS and CBD and the need for reconciling these.

Denying the CBD secretariat observer status would create a scandal, vis-a-vis the WTO, one trade diplomat later observed.

The Council also undertook a review of the legislation adopted by countries for implementation of the TRIPS Agreement in 13 countries, and set a programme to review those relating to 42 other countries in 2001.

For developing countries, the transition period for implementation of the TRIPS agreement ended on 31 December 1999, except in the field of chemicals and pharmaceuticals where there is a further 5 years to have laws and implement product and process patents.

One of the countries who IPR laws and enforcement were reviewed this week was Indonesia’s.

That government frankly told the TRIPS Council, according to participants, that while it was striving to enforce the law, it was facing difficulties in implementing the law and cracking down on ‘piracy’ of computer software and Compact Discs (CDs). The ‘raids’ on places suspected to be producing or using such CDs without authorization of the original owners, was resulting in ‘riots’ and creating a difficult social and law and order problem.

On the geographical indications issue a number of developing countries and some transition economies called for work being undertaken towards extending the protection of geographical indications of origin to products other than wines and spirits. Some of the products being mentioned in this regard are: basmati rice, a rice that when cooked gives a natural aroma and a special taste, and grown in particular regions of India and Pakistan, other varieties of rice with fragrance grown in Thailand and carrying a name associated with the region, mango varieties like alphonso grown in particular parts of India, some varieties of cheese whose names are associated with particular regions and places in France and Switzerland, and some indigenous handicrafts and products of a number of countries associated with particular areas.

The proposals of India and several developing countries got support from Bulgaria, Switzerland and Turkey and to some extent from the EC.

It was opposed by the US - where the patenting of basmati rice and other products from developing countries is now under challenge. The US position against extending scope of geographical indications of origin was supported by Argentina, Chile, Australia and New Zealand.  [At the Special Session on Agriculture on Friday, Bulgaria (supported by India and others) said that if some countries took a narrow view of the TRIPS negotiations on geogrpahical indications, Bulgaria and others would at future agricultural negotiations meetings take a similar narrow view on the further reform process mandated under Art. 20 of the Agriculture Agreement.]

In all these countries, said a trade diplomat, there is not only production and sale of wines and spirits like champagne or chablis (wines associated in the beginning with grapes grown and wines produced in particular regions of Europe) but which are now produced with similar names in the US, Australia, and Chile.

Some of the cheeses like emmenthal (originally produced in Switzerland, but later also in France) and Camembert (French cheese, now also produced in Switzerland) are now produced under similar names and marketed by some of the countries opposing extension of the protection of geographical origin.

Related to this is a EC proposal for the negotiations mandated under Art. 23.4 for a multilateral system of registration and notification of geographical indications for wines eligible for protection.

[India and other developing countries are using this process to expand the protection list to products other than wine]

The EC proposal on the table calls for notification and registration, and an objection procedure if a geographical indication of origin (to be protected) is notified and found to be in use for a product in another country or region too.

But the EC proposal in such a case calls for bilateral negotiations to settle the problem.

Many developing countries have opposed this, since in any such bilateral negotiations, the EC’s greater market power would enable it to apply pressures (as has happened with regard to South Africa and extension of benefits to it under the Lome, being conditional on protecting some EC names for wines and spirits).

The developing countries insist that any such conflict or challenge over the registration should be addressed and resolved multilaterally.-SUNS4699

The above article first appeared in the South-North Development Monitor (SUNS) of which Chakravarthi Raghavan is the Chief Editor.

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