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TWN Info Service on WTO and Trade Issues (Oct04/6)

6 October 2004

Third World Network

BRAZIL, INDIA STATEMENTS AT WIPO ON THE DEVELOPMENT AGENDA

During the debate at the WIPO General Assembly on the agenda item on the proposal for establishing a Development Agenda for WIPO, two of the most interesting presentations were made by the delegations of Brazil and India.  Brazil on 30 September introduced the proposal on behalf of its co-sponsoring developing countries and explained the rationale and main points of the proposal. India’s statement on 1 October gave a interesting development perspective on the effects of global intelectual property regimes on developing countries.

Below are the two statements.  We acknowledge the assistance of Thiru Balasubramaniam of Consumer Project on Technology for arranging for these statements to be available.

 

With best wishes

Martin Khor

TWN

 

 

September 30, 2004

40th Series of the Assemblies of the Member States of WIPO

Item 12: Proposal for the establishment of a Development Agenda for WIPO

Statement by the Delegation of Brazil

I take the floor on the behalf of Argentina, Bolivia, Brazil, Cuba, Dominican Republic, Ecuador, Iran, Kenya, Sierra Leone, South Africa, Tanzania and Venezuela to say a few introductory words regarding our Proposal for the Establishment of a Development Agenda for WIPO, contained in document WO/GA/31/11. We would like to delve on, in particular, the objectives and content of the Proposal.

At the dawn of a new Millennium, Development undoubtedly remains one of the most daunting challenges facing the international community. This has been widely acknowledged at the highest level in various international fora. Finding solutions to the concerns and problems facing developing countries and LDCs is an overriding concern of the international community, as clearly attested by the adoption by the United Nations of the Millennium Development Goals.

As a specialized agency of the United Nations, WIPO must be guided in all its activities by the broader development-related commitments and resolutions of the UN system.

IP is not an end in itself. And it certainly must not be seen as such in an institution such as WIPO, a Member of the UN family. If Development is an overriding concern and goal of the UN system, then one is obliged to ensure that the intellectual property system, of which WIPO is a central part, effectively operates in a manner supportive of that goal.  Integration of the “development dimension” into all WIPO activities is therefore of the essence.

In other international fora addressing intellectual property matters, the “development dimension” of intellectual property has already received increased recognition. In this regard, we wish to recall, in particular the landmark adoption of the Doha Declaration on the TRIPS Agreement and Public Health at the 4th Ministerial Conference of the World Trade Organization. Similarly, development-related concerns with regard to the issue of intellectual property have been raised and are currently being addressed in fora such as the World Health Organization and the UN Human Rights Committee. The Sao Paulo Consensus, moreover, which was adopted by UNCTAD XI, enshrined the important concept of “policy space”. This concept is particularly relevant to the intellectual property sphere, where the very distinct stages of industrial and technological development of different countries call for distinct strategies and approaches.

The time has now come for WIPO, as a specialized UN agency, to make a systematic contribution to this broad discussion and to begin a process of fully integrating the development dimension into all of its work. The Development Agenda is meant to be a positive agenda, not a negative one.  That is the spirit within which we have tabled this Proposal.

Our Proposal is a broad and horizontal one and addresses WIPO’s work in all its dimensions. Its general relevance is, therefore, certainly not to be limited to any specific subsidiary body within WIPO. All WIPO bodies and activities should clearly integrate the “development dimension” into their work. The Proposal also suggests that WIPO should pay more heed to other issues, such as the transfer of technology and the curbing of anti-competitive practices.

In tabling this Proposal, it has not been our intention to reverse WIPO’ s work or introduce divisive issues for the Membership. IP issues are difficult, because they are complex. But they are of relevance to all countries, rich and poor. Likewise, Development represents a shared objective of the international community at large. Nor has it been our intent to criticize WIPO’s work on technical cooperation, which is of great importance for developing countries, particularly the least developed ones. We fully support these activities and would like to see them expanded in accordance with the specific requirements and needs of each country, in line with the principles and objectives set forth in section VII of our document.

Our main purpose in tabling this Proposal has been to reestablish WIPO’s central mission and goal as a UN specialized agency, which, in accordance with the terms of its Agreement with the UN, are to “promote creative intellectual activity” and the “transfer of technology to developing countries”. By proposing to readjust WIPO’ s course, we wish to ensure the effective and proper realization of that central mission.

The development agenda is not only in the interest of developing countries, it is essentially a global interest, in fact it is the most important global requirement, one which irradiates positively on all other agendas. An adequate and balanced system of intellectual property for our time, one that promotes innovation, creativity and the wide dissemination of knowledge, is inclusive of all peoples and fully services the public interest, is of crucial importance to peoples both in the developed and developing worlds. It would therefore be erroneous to see the establishment of a Development Agenda for WIPO as an attempt to polarize debate in this institution.

We recall, in this regard, the recently launched Geneva Declaration on the Future of WIPO, which bas been signed by a broad cross-section of over 500 individuals affiliated with public interest non-governmental organizations, well-known Academics, including Nobel Prize laureates, inventors and authors, and public libraries, the majority of which are from developed countries. This inspiring Declaration, which has brought to the diplomatic halls of Geneva the powerful voice of civil society and its concerns and aspirations in respect of the evolution of the intellectual property system and of WIPO, speaks eloquently about the broad relevance of the Development Agenda: “The proposal for a development agenda”, it states, “has created the first real opportunity to debate the future of WIPO. It is not only an agenda for developing countries. It is an agenda for everyone, North and South. It must move forward. All nations and peoples must join and expand the debate on the future of WIPO.”

We would point out, moreover, that yesterday, September 29th a group of 26 public interest NGOs issued a statement supporting our proposal for a “WIPO Development Agenda”.

We see this, indeed, as the proposal of everyone. It is, in effect, in the public domain. It is meant to speak to the concerns of everyone, or at least to the concerns of all of us whose voices have not been properly heard. In taking the initiative of tabling this Proposal, our intention was to launch a process of debate, to which we hope all WIPO Members will want to contribute. Though our Proposal contains many ideas, it offers no definitive solutions. Because Development is a shared commitment of the international community, incorporating the “development dimension” in all WIPO activities should be a major concern for us all. It is therefore our collective responsibility to ensure that the Development Agenda moves forward. This debate is necessary for the sake of WIPO, for its legitimacy and credibility as an institution. We want to help it cater to the interests and concerns of all Member States and all relevant stakeholders, including, in particular, civil society.  Given the breadth of the conceptual discussion we wish to have, our work could also be enriched by drawing on the input from other relevant international organizations that have done work related to the “development dimension” of IP.

We look forward to the discussion in this General Assembly on the Proposal to Establish a Development Agenda for WIPO, which we are honored to have tabled.

 

STATEMENT BY INDIA

Item 12: Proposal for Establishing a Development Agenda for WIPO

Statement by Debabrata SAHA,

Deputy Permanent Representative of India

 

Let me start on a positive note by asking: with all the damage that TRIPS has wrought on developing countries could it possibly have a silver lining? Maybe - if we want to be generous. TRIPS, one might argue, did bring intellectual property to the forefront of consciousness of people everywhere, and, over time made them aware of the dangers inherent in a protective regime that takes little account of either public policy, or the state of development of a member country.

When India won independence in 1947 changes were considered in our IP laws to reflect the social and economic needs of the country. After lengthy debate, the patent laws were finally revised through the Patent Act of 1970. The new law did not recognize patenting of substances that result from chemical reactions, and they did not allow product patent protection for drugs. Only process patents were allowed for pharmaceutical and agro-chemicals. During the 1970’s and 80’s, India’s pharmaceutical industry grew rapidly as it focused on the manufacture of generic drugs, and on learning from products that had been developed elsewhere.

As developing countries move to fulfill their obligations under TRIPS to provide product patent protection for pharmaceuticals and agricultural chemicals from January next year our drug and biotechnology industries will be faced with a major challenge. Given the skills and ingenuity that they have displayed so far, I believe they will succeed in overcoming that challenge.

Developing countries are often quite well endowed in scientific skills.  But they need the same flexibilities that today’s developed countries had when they themselves were at a comparable stage of development. That is why any global IP regime needs to be flexible. This is where WIPO, as a specialized UN agency, can make a major impact- by truly incorporating the development dimension into its mission- in letter and in spirit, so that is appropriately reflected in all its instruments.

All members of WIPO need to recognize that higher and higher levels of IP protection, inherent in any harmonization exercise that takes no account of the circumstances of each country, are extremely detrimental to developing countries. Intellectual property rights have to be viewed not as a self contained and distinct domain, but rather as an effective policy instrument for wide ranging socio-economic and technological development. The primary objective of this instrument is to maximize public welfare. The national policy space of each country must be respected, especially when developing countries are asked to assume international obligations. Even the most advanced developed countries, with their complex laws, have to grapple with the anti-competitive practices linked to patents. The absence of any comparable legal regime in developing countries means that these countries are required to grant monopoly rights to IP holders, without any meaningful or credible instruments to regulate the exercise of these rights.

Given the huge disparities existing across the world it is open to question whether IP harmonization benefits developing countries. The developed countries do pay lip service to “development” in the context of Intellectual Property protection, but they do so rather self-servingly. The term ‘development’ as used by these countries, including in WIPO, means quite the opposite of what developing countries understand when they refer to the ‘development dimension’. If you share the perspective of the developed countries, ‘development’ means increasing a developing country’s capacity to provide protection to the overwhelmingly developed country owners of IP rights!

A WIPO Development Agenda would obviously need to take into account any possible negative impact on the users of IP, on consumers at large, or on public policy in general, and not just the promotion of the interest of Intellectual Property owners. It is vital to inject this balance and equity into the various WIPO bodies.

In a developed country, where the monopoly profits of the domestic IP rights holders are recycled through the economy, if we set aside the question of fairness to consumers who have often to pay exorbitant monopoly prices for many patented products, including those for treating life threatening diseases, at least some benefit is derived by the public at large. For example, jobs might be created by the investments made possible by the monopoly profits of IP holders. Taxes on these profits contribute to the funding of transfer payments and social welfare schemes. Even so, there is a continuing debate on the equity and fairness of such protection, with some even questioning its claimed social benefits. Indeed, even in the hypothetical case where IP rights are limited to only domestic holders, whether the cost-benefit calculus favors strong protection is still an open question.

Such secondary benefits, however indirect, do not flow across national boundaries. Given the huge asymmetry between developed countries and developing countries, the total absence of any mandatory cross-border resource transfers or welfare payments, and the absence of any significant domestic recycling of the monopoly profits of foreign IP rights holders, the benefits are all on one side—in the developed countries—and the costs on the other—in the developing countries. The inescapable conclusion is: Harmonization of IP laws across countries with asymmetric distribution of IP assets is intended to serve the interest of rent seekers, who are predominantly in developed countries, rather than that of the public in developing countries.

Not surprisingly, developed countries have always shied away from any discussion that invokes the primary rationale for Intellectual Property protection. They would rather not be reminded that IP protection was meant, first and foremost, to promote societal development by encouraging technological innovation. The legal monopoly granted to IP owners is only incidental—a consequence of the need to provide an incentive for innovation. But such incentive needs to be carefully calibrated by each country, in the light of its own circumstances, taking into account the overall costs and benefits of such protection.  Policy flexibility is a sine qua non if societies are to ensure that the intended beneficiary—the public in each country—is not worse off as a result of such protection.

For developing countries to benefit from providing IP protection to Western rights holders there has to be some obligation on the part of developed countries to transfer and disseminate technologies to developing countries. Absent an obligation on technology transfer, asymmetric IP rent flows would become a permanent feature, and the benefits of IP protection would forever elude consumers in developing countries.

Technology transfer is an issue that Western countries balk at, even though a ‘best endeavor’ obligation exists in TRIPS. The self-serving response usually is that stronger IP protection, of and in itself, would ensure technology transfer! Such a response is really not surprising.  TRIPS, as we all recognize, is a tribute to the logic of power, not of economics, and most certainly not of fairness. It was sold on a false prospectus, to preserve the monopoly benefits accruing to the patent owners—nearly all of whom are based in the developed world—often at the expense of public policy in developing countries. A WIPO Development Agenda would help steer the organization away from a similar devious course.

While the benefits of strong IP protection for developing countries are a matter of debate—and nearly always in the distant future—such protection invariably entails substantial real and immediate costs for these countries. In formulating its IP policy, therefore, each country needs to have sufficient flexibility so that the cost of IP protection does not outweigh the benefits. No longer are developing countries willing to accept without question that a harmonized global patent system benefits all countries, or that it is needed to nurture innovativeness everywhere.

We fully support the objective for the proposal submitted by Argentina and Brazil. We believe the proposal will contribute towards integrating the development dimension into all areas of WIPO’s work and activities.  We would like to see these proposals concretely translated to address the concerns of the developing countries, including by the establishment of a Working Group on the Development Agenda.

 


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