Kanaga Raja
SUNS (South-North Development Monitor)
10 March 2004

Significant differences remain on a proposed amendment to the TRIPS agreement enabling countries to export drugs made under compulsory license to countries with insufficient or no manufacturing capacities in the pharmaceutical sector, a TRIPS Council meeting was told on 8 March 2004.

The outgoing Chair of the TRIPS Council, Ambassador Vanu Gopala Menon of Singapore said that based on a series of consultations that he had with members in December, February and March this year, significant differences remained on a proposed amendment to the TRIPS agreement.

He informed the TRIPS Council that his successor, Ambassador Joshua Law of Hong Kong China would hold further consultations before the next TRIPS Council meeting in June.

The proposed amendment to the TRIPS agreement was an outcome of a decision adopted in 30 August 2003 that granted a temporary waiver to WTO members' obligations under Art. 31 (f) of the TRIPS agreement, which says that production under compulsory licensing must be predominantly for the domestic market.

This provision limited the ability of some countries that did not have the capacity to produce pharmaceutical products from importing cheaper generics.

In order to make the waiver a permanent amendment to the TRIPS agreement, the 30 August decision instructed the TRIPS Council to start work in 2003 and to complete its work on the amendment by June 2004. WTO members also agreed that the waiver would last until the TRIPS agreement is amended.

The 30 August decision allows any member country to export pharmaceutical products made under compulsory licences within the terms set out in the decision. All WTO member countries are eligible to import under this decision, although 23 developed countries are listed in the decision as announcing voluntarily that they will not use the system to import drugs.

In summarizing his consultations to the TRIPS Council, Ambassador Menon indicated that there were differences over the content, the legal form and the timing of the proposed amendment.

With regards to content, one difference is about how to deal with the statement that then General Council chair, Uruguayan Ambassador Carlos Perez del Castillo made just before the General Council approved the decision on 30 August 2003. His statement included a list of countries that voluntarily announced that if they use the system it would only be for emergencies or extremely urgent situations - Hong Kong China, Israel, Korea, Kuwait, Macao China, Mexico, Qatar, Singapore, Chinese Taipei, Turkey and United Arab Emirates.

A specific concern for some countries is to avoid turning this voluntary statement into something that might be more binding legally.

Another concern is whether to try to ensure that the amendment is simply a technical exercise to translate the waiver into a provision of the TRIPS Agreement, or whether it could be refined.

In informal consultations, some developing countries had reservations about the original waiver in that it was too burdensome and they wanted to refine it.

With regards to the legal form, among the options that emerged in the TRIPS Council chair's consultations is a footnote referring to the decision and possibly the chairperson's statement; a new paragraph in the agreement ("Article 31bis"); and an annex linked from the main text by a footnote.

There has been some discussion about the legal implications of these options including the question whether a footnote link to the 30 August General Council chair's statement would make it more binding legally.

On the timing of a proposed amendment, the countries seeking a straight technical translation of the waiver say that it can be done by the end-of-June deadline, and some say that it is important to try to meet the deadline. Countries seeking a possible refinement of the decision say that the deadline can be missed. One proposed option is to delay the amendment by nine months - the length of the delay on the original decision.

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Discussion on Article 27.3b: Developing Countries present "checklist of issues" on TRIPS/CBD Relation

The TRIPS Council also took up the issue of Article 27.3(b) of the TRIPS agreement that deals with intellectual property protection or freedom from intellectual property protection for plants, animals and microorganisms.

This comes under para 19 of the Doha Declaration and is linked with traditional knowledge and folklore, and the relationship between the TRIPS Agreement and the Convention on Biodiversity (CBD).

A group of developing countries including Bolivia, Brazil, Cuba, Ecuador, India, Peru, Thailand and Venezuela presented a paper, a check-list of issues, to provide more focus to the discussions. Pakistan asked to join the group during the Council meeting. India, on behalf of the group, said that some of the topics have been discussed without any conclusion since 1999.

The paper said that one of the major concerns expressed is that the TRIPS agreement allows the granting of patents for inventions that use genetic material and associated knowledge without requiring compliance with the provisions of the CBD.

"To the extent that bio-piracy is today accepted as a major problem, the challenge is to determine what measures need to be taken within the framework of the TRIPS Agreement to prevent misappropriation and to support the objectives and implementation of the CBD," the paper said.

The paper's checklist of issues to be discussed is grouped under three headings: disclosure of the source and country of origin of biological resources and of the traditional knowledge used in the invention; disclosure of evidence of prior informed consent under the relevant national regime; and disclosure of evidence of benefit sharing under the relevant national regime.

During discussions over the paper, the EU said that while it disagreed with some points (such as disclosing evidence of prior informed consent), it could accept the checklist as a way to structure discussion. The EU also said that in order to avoid duplication, the TRIPS Council's work on traditional knowledge should wait for developments in the World Intellectual Property Organization's Inter-Governmental Committee (IGC). Even though progress is slow in that committee, nevertheless some progress is being made, the EU said.

Switzerland was sympathetic to working with a checklist but had reservations about some of the items on it. Norway said it has amended its patent law to require disclosure of sources, and also disclosure of prior informed consent if that is required in the source country (but these disclosures are not required for "international patent applications").

The US opposed the checklist, arguing that there is no conflict between the TRIPS and the Biodiversity Convention, and therefore there was no need to amend the TRIPS Agreement. The US, which is not a party to the CBD, said it would resist attempts to enforce the Biodiversity Convention by amending patent laws and it opposes disclosure obligations. The US also advocated working in WIPO. Japan took a similar view.

Zimbabwe, China, South Africa, and Kenya supported the checklist. They, and the paper's sponsors, insisted that the TRIPS Council should discuss issues, even if they are handled in WIPO as well, because of the mandate from the Doha Declaration. Chinese Taipei said that it is unable to participate in discussions in some other organizations.

The EU also commented on the African Group's paper (IP/C/W/404) circulated earlier. The EU said it supports the approach of trying to identify and work on areas where agreement seems possible. A proposed ban on patenting life forms would be opposed by countries with biotechnology industries, the EU added, suggesting instead that flexibilities in the TRIPS Agreement (interpreting "patentability" and "invention") should be used to allow biotechnology to serve development.

Ambassador Law will hold further consultations on this group of issues.

Earlier, on discussions in respect of the review of the implementation of Geographical Indications provisions required under Art. 24.2 of the TRIPS agreement, and which has been on the agenda since 1996, Australia, the US and New Zealand advocated looking at implementation experiences paragraph by paragraph of the agreement.

The EU and Switzerland say that much of that has already been covered by reviews of legislation. They prefer going through points raised in a Secretariat paper based on members' replies to a set of questions (IP/C/W/253/Rev.1).

The discussions were inconclusive. The next meeting of the TRIPS Council is on 15-17 June.

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