TWN Info Service on WTO and Trade Issues (Oct15/17)
23 October 2015
Third World Network

South moots making non-violation complaints inapplicable to TRIPS
Published in SUNS #8115 dated 19 October 2015

Geneva, 16 Oct (D. Ravi Kanth) -- A large majority of developing and the least-developed countries on Thursday (October 15) turned the tables against the United States and Switzerland at the World Trade Organization (WTO) by proposing that non-violation complaints shall be made inapplicable to the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), several participants told the SUNS.

Even a few developed countries such as Norway and New Zealand supported this draft proposal from over 90 developing and least developed countries for the Nairobi ministerial meeting declaring the inapplicability of the non-violation complaints (NVCs) to the TRIPS agreement.

The United States and Switzerland, which called for the termination of the moratorium on the NVCs, stood isolated at the meeting.

At an informal meeting of the WTO's TRIPS Council on Thursday October 15, over 90 developing and least- developed countries proposed a resolution calling for a permanent moratorium for applying non-violation complaints to disputes under the TRIPS agreement.

Peru, which proposed the resolution on behalf of developing and least-developed countries, said that "there is a confluence of interests with many members including the African and LDC [least-developed countries] members who are not co-sponsors of the resolution."

"An overwhelming majority of countries now want that the NVCs should be made inapplicable," Peru said.

Many countries such as Brazil, India, China, the Philippines, Thailand, Russia, Chile, Norway, South Africa, Sri Lanka, Nepal, Korea, Cuba, Indonesia, Argentina, Colombia, Egypt and Ecuador among others have co-sponsored the proposal tabled by Peru.

India warned that "the application" of NVCs to the TRIPS agreement will have a "chilling" effect on members and "the flexibilities [in the TRIPS agreement] will be severely curtailed."

"There is a strong potential of IP [intellectual property] regimes and practices in member-countries will be opened to [legal] challenges," India argued.

"The cycle of moratoriums must end and the draft ministerial decision [circulated by Peru] is the culmination of these efforts to end the moratorium,' India maintained.

The European Union said it doesn't see any relevance of applying NVCs to the TRIPS agreement. The EU maintained that if there is no consensus on Peru's proposal, members must agree to extend the moratorium for not applying the NVCs in the TRIPS context.

Norway said "applying non-violation and situation complaints to the TRIPS Agreement would be particularly difficult and problematic in relation to the principle of legal certainty."

"We are therefore of the view that non-violation and situation complaints should be determined inapplicable to the TRIPS Agreement," Norway said, adding that "while we are not a co-sponsor, we strongly support the content of the draft ministerial decision [proposed by Peru]."

New Zealand also called for the inapplicability of NVCs to the TRIPS agreement.

Notwithstanding the overwhelming support from members for the draft ministerial decision against the NVCs, the US and Switzerland stuck to their position that the moratorium will be terminated at the Nairobi meeting.

"We will not support the ministerial decision, as well as the moratorium," the US maintained, according to a participant present at the meeting. "If there is no consensus on the continuation of moratorium [at the Nairobi meeting] then NVCs will automatically apply," the US warned.

Switzerland said the dispute settlement provisions provide sufficient guidance to members for applying NVCs to the TRIPS agreement.

It remains to be seen how the large majority of developing and the poorest countries will press their issue at Nairobi in the face of opposition from the US and Switzerland.

On a separate issue concerning the demand for an indefinite waiver from the TRIPS commitments, the US conveyed to the least-developed countries on Thursday that any extension of the existing waiver from implementing the commitments in the WTO's TRIPS agreement for pharmaceutical products must be "time bound" and the duration of the waiver must be negotiated.

Effectively, the US has rejected the demand from the poorest countries for an indefinite exemption until they graduate from their current LDC status, an African trade official told the SUNS.

During a meeting between the US and Bangladesh which coordinates the LDCs at the WTO, the US trade envoy Ambassador Michael Punke has made it clear that it will only agree to a "time bound" extension in which the duration has to be negotiated, said a person familiar with the meeting.

The LDCs have already made it known that they want an extension until they graduate to a developing country status based on an economic criteria.

In the worst-case scenario, the LDCs are willing to consider extension till 2030 in line with the United Nations Sustainable Development Goals, the person said.

Faced with the inflexible American position, Bangladesh conveyed to Ambassador Punke that it would consult with its members. The LDCs are expected to inform the US soon about their final response on the time bound exemption based on further negotiations.

Despite enormous pressure from the US lawmakers and international pressure groups, the US along with Switzerland, Japan, Canada, and Australia have continued to adopt a tough stand, while the EU is ready to accept the LDCs' demand for an extension until graduation. +