|
||
|
TWN
Info Service on WTO and Trade Issues (May22/07) Geneva, 9 May (D. Ravi Kanth) – Amidst sharply divergent views on the draft “TRIPS COVID-19” text circulated by the World Trade Organization’s Director-General on 3 May, China has rejected one particular condition in the text on systemic grounds, as it uses the criterion of export share to define eligible members, said people familiar with the development. At a formal WTO TRIPS Council meeting on 6 May, discussions on the text circulated by the DG, Ms Ngozi Okonjo-Iweala, went into uncharted waters as many developing countries raised sharp concerns that the text did not address several core issues, including access to diagnostics and therapeutics, said people familiar with the proceedings. CHINA CHALLENGES ELIGIBILITY CRITERIA In a hard-hitting statement, the Chinese trade envoy said that while it cautiously welcomes the text, the particular condition in the text that says countries with more than 10% of exports of vaccines in 2021 will be excluded from implementing the provisions in the text, would constitute “punishment to those who supplied a large amount of vaccines to others even when they themselves were suffering from shortages.” Without naming the US or the European Union, which allegedly imposed export restrictions on vaccines and its ingredients, China said that “this (condition) constitutes a tolerance or even an incentive for members to adopt inward-looking policies and apply export restrictions in difficult times when we should resist such temptations.” “Such an unreasonable and arbitrary criterion will send a wrong signal to the outside and will also have systemic implications to the future negotiations,” China’s trade envoy Ambassador Li Chenggang said at the formal WTO TRIPS Council meeting. China said that it can’t accept this particular condition which states, “for the purpose of this Decision, developing members who exported more than 10 percent of world’s COVID-19 vaccines doses in 2021 are not eligible Members.” Apparently, the United States is understood to have inserted this condition during the DG-convened informal discussions involving the US, the European Union, India, and South Africa. At the meeting, China suggested that “a more general language to encourage members who are in a position to opt out can be a solution”. Ambassador Chenggang said “based on our proposed footnote and in line with assessment of our capability, we are willing to address the eligibility issue in a pragmatic and constructive manner, so that an outcome that benefits developing members and LDCs (least-developed countries) in genuine needs could be reached at an earliest date.” According to a Quad negotiator, China had submitted its proposal and looked forward to meeting with the Quad members. However, the US apparently abstained from a scheduled meeting of Quad members with China. At the TRIPS Council meeting, China also raised concerns about the Quad process, saying that “any negotiation in this organization, including the ongoing TRIPS waiver discussion, shall be guided by the principles of openness, transparency, and inclusiveness,” emphasizing that “outcomes shall be fair and non-discriminatory.” Otherwise, China said “it will be difficult to build consensus among members, in particular for those who have not been involved in the process.” “The procedural fairness is even more relevant for the TRIPS waiver discussion, which needs a proper and urgent solution as it relates to human life and livelihood,” China said. Without referring to the ongoing war between Russia and Ukraine and the exclusion of Russia from all small-group meetings at the WTO on account of a US-led campaign, China said members “should also avoid any hindrances to its successful outcome due to politically-motivated disturbances.” “So my question to everyone in this room,” the Chinese trade envoy asked, “is this: is it a right signal that the WTO, a long-time advocate of free trade and multilateral cooperation, should be sending to the world? Should the contributions made by members during the pandemic be encouraged or discarded?” Referring to the WTO DG’s oft-repeated comment that “multilateral cooperation on trade is needed to address the mounting challenges we are encountering,” Ambassador Chenggang cautioned that “if the second brackets remain (the 10% condition) as it is, I have a serious doubt on how the long-held spirits of unity and cooperation could be preserved in this organization. Who will be willing to export critical materials to others if we are to face another pandemic in the future? And how the interest of the vulnerable economies, developing members and LDCs, could be protected?” China said that “compared with the second brackets language, the first brackets (all developing country Members are eligible members and developing country Members with capacity to export vaccines are encouraged to opt out from this decision) adopt a more positive approach, i.e. to encourage developing members who have capability to opt out from this decision.” “This is the right direction we should work to,” said China, adding that “however, as to what I just said on export criterion, we believe a more general language to encourage developing members who are in a position to opt out can be a solution.” [However experts have noted that the first bracketed option (developing country Members with capacity to export vaccines are encouraged to opt out from this decision) was also extremely problematic for it makes a mockery of the entire decision as well as the WTO. The main rationale is to diversify production and to increase supply options, meaning countries with manufacturing capacity should have the freedom to operate to manufacture, while barriers to export should be removed. If countries with production and export capacity are encouraged to opt-out, then how will supply be made available? Further this option will embolden developed countries and Big Pharma to increase further pressure on developing countries with capacity to produce and export to refrain from using non-voluntary licenses under Article 31.] China maintained that being one of the main producers of vaccines, it remains determined “to make further contributions to the global pandemic response.” It offered a pragmatic solution to overcome the differentiation issue so that “an outcome that benefits developing members and LDCs in genuine needs could be reached at an earliest date.” During the TRIPS Council meeting, members expressed their divergent views on the draft text circulated by the DG on 3 May, voicing concerns on several aspects of the text, including the ownership of text as well as the navigators for further negotiations, said people familiar with the proceedings. QUAD MEMBERS REMAIN CONSTRUCTIVELY AMBIGUOUS The United States seems to have adopted a constructively ambiguous position without revealing its mind, said a participant, who asked not to be quoted. The US said that it is currently discussing the text with its domestic stakeholders. It emphasized that it is looking forward to further consultations with all members for finding convergence that can lead to a consensus solution. South Africa said it hopes the circulation of the proposed outcome document will imply engaging in text-based negotiations. South Africa also recalled the original Waiver proposal co-sponsored by 65 countries, while more than 100 countries supported the proposal (IP/C/W/669/Rev.1). That revised TRIPS Waiver proposal submitted on 25 May last year called for suspending certain TRIPS obligations such as copyrights, industrial designs, patents, and protection of undisclosed information to create the freedom to operate for manufacturers, so that production may be diversified and scaled up with the aim towards timely equitable access for a rapid and effective response to the COVID-19 pandemic. In contrast, EU’s proposal submitted in June 2021 revolved around restating the conditions concerning the use of compulsory licensing. The EU’s proposal appears to have become the basis of the DG’s “TRIPS COVID-19” text presented as a “take-it- or-leave-it” text by WTO’s senior officials engaged in the Quad negotiations, said two Quad persons familiar with the document. At the meeting, South Africa said it hopes members can work together in a solution-oriented mode towards an outcome that can be resolved before MC12 (12-15 June) and that will unlock productive capacity in developing countries, especially in Africa. India emphasized its commitment to remain constructively engaged with members to reach a meaningful outcome on this very crucial issue. Brussels said the process for arriving at a “compromise” outcome has been “difficult and protracted”, insisting that the DG’s text offers the most promising path towards achieving a meaningful outcome among all WTO members. The EU maintained that it sees this proposal as only one element of a broader package of key outcomes for MC12 including other aspects of trade and health, joint action against food security concerns, agriculture, sustainability, the conclusion of fisheries subsidies negotiations and WTO reform. CONCERNS OF DEVELOPING COUNTRIES At the TRIPS Council meeting, a large group of developing countries called for including diagnostics and therapeutics in the proposed decision. Several members also raised sharp concerns over the eligibility criteria options as well as on paragraph 3(a) which includes elements that go beyond the requirements of the TRIPS Agreement, in particular requiring the listing of patents in non-voluntary authorizations. Many delegations further pointed to the need to include a clear reference that the text would apply without prejudice to existing flexibilities under the TRIPS Agreement. [Paragraph 3(a) of the DG’s text states: With respect to Article 31(a), an eligible Member may issue a single authorization to use the subject matter of multiple patents necessary for the production or supply of a COVID-19 vaccine. The authorization shall list all patents covered. In the determination of the relevant patents, an eligible Member may be assisted by WIPO’s patent landscaping work, including on underlying technologies on COVID-19 vaccines, and by other relevant sources. An eligible Member may update the authorization to include other patents.] Indonesia said paragraph 3(a) in square brackets would “mean an additional burden on the officers charged with this function to comply with because some countries may not be well equipped in terms of many developmentally related barriers to handle such an intense task of listing when needed.” Indonesia proposed that paragraph 3(a) of the text be deleted. It also stressed that excluding certain members in an arbitrary manner would be a bad precedent. On behalf of the African Group, Tanzania said that its members would need more time for consultation with their respective capitals. In an initial comment on the proposed outcome document, the African Group noted that other elements, particularly therapeutics and diagnostics, as well as transfer of technology are equally important to address the COVID-19 pandemic in a holistic manner. Zimbabwe expressed concerns that the text excludes therapeutics and diagnostics. It could not accept the options for eligibility criteria presented and referred to the self-opt-out approach taken by Members under Article 31bis of TRIPS Agreement. It stressed that the waiver remains a critical element to the pandemic and the need to be prepared for the next one. Malaysia stressed that the exclusion of a country is not acceptable and the need for transparency and inclusiveness in moving forward. OTHER DEVELOPED COUNTRIES The United Kingdom and Switzerland, which vehemently opposed the revised TRIPS waiver co-sponsored by 65 countries, apparently underscored the importance of the international IP framework, coupled with partnerships among entities from private, academic and public sectors, to enable rapid innovation in the response to COVID-19 and the production of vaccines at an unprecedented pace. The UK pointed out that the shared text is not endorsed by any member, noting that at this point it is unclear how members can establish a dialogue without knowing who will be able to respond to questions on both wordings and intent of the text. Switzerland noted that it is looking forward to a presentation and explanation of the text by those members that were involved in the informal discussions. Mexico also sought to know who among the Quad members will address questions and clarifications that members may raise. Several industrialized countries like New Zealand, Australia, Japan, Singapore and Korea called for a creative solution to a debate which has seen some robust discussion and strong differences of opinion in the Council. Singapore said the proposal may require further tweaks, it is essential to engage with one another in good faith and in the same spirit of compromise, and most importantly, not backtrack on the progress that has been made so far. TRIPS CHAIR’S RESPONSE The Chair of the TRIPS Council, Ambassador Lansana Gberie from Sierra Leone, agreed that the manner of circulating the text is somewhat unusual, but it should not be an obstacle for members’ meaningful engagement on this text. “The fact that a number of active delegations with divergent views have invested months of hard work to come together around a text means that we may now have a realistic chance to promptly reach an agreed outcome on this longstanding and very urgent issue,” the Chair said in his concluding statement at the meeting. “It will not be easy, and it is in the nature of consensus that compromises are required on all sides and no one side will be entirely happy with the outcome. But an agreement by all members on a practical outcome on the role of IP in a pandemic will send a strong signal that despite all the differences, the WTO community can come together and highlight how the multilateral rules can help address this and future crisis.” The TRIPS Council Chair will send the oral status report adopted by members to the General Council (GC) meeting starting on 9 May. The Chair said the text provides a factual overview of discussions held at the TRIPS Council since October 2020, when India and South Africa presented the first proposal to suspend certain provisions in the TRIPS Agreement relating to copyrights, industrial designs, patents, and protection of undisclosed information for ramping-up production of diagnostics, therapeutics, and vaccines across countries for combating COVID-19 pandemic. The proposal was adopted by 63 countries later. It became the central point for a global battle with more than 100 countries, as well as global leaders, academics, Nobel Laureates and international civil society groups having joined the battle in support of the proposal. The Chair, in his report, conveyed to the GC that the “TRIPS Council has not yet completed its consideration of the revised waiver request (IP/C/W/669/Rev.1) submitted by 65 countries in last May and therefore, continue its consideration of the revised waiver request and report back to the General Council as stipulated in Article IX:3 of the Marrakesh Agreement.” The Chair noted that “the TRIPS Council will also continue in the same manner its consideration of other related proposals by members.” The Chair said he will hold further consultations in different configurations after the General Council meeting on 9-10 May on how to structure substantive discussions going forward. The next regular TRIPS Council meeting will be held from 6-7 July, instead of 8-9 June as initially scheduled.
|
||
