The TRIPs Agreement: Main Provisions Achim Seiler, Trade Consultant and Capacity Building Specialist, Kathmandu EU-Project: Trade and Private Sector Development (TPSD) TPSD is implemented by in cooperation with and

TRIPs or Traps ? TRIPs is neither the cause of many problems nor their solution, but it is getting extremely relevant

TRIPs Part 1: General Provisions Part 2: IPRs Standards Part 3: Enforcement of IPRs Part 4: Acquisition and Maintenance of IPRs Part 5: Dispute Prevention and Settlement Part 6: Transitional Arrangements Part 7: Final Provisions

Part 2: Standards Concerning the Availability, Scope and Use of IPRs Copyrights and Related Rights Trademarks Geographical Indications Industrial Design Patents Layout-Designs of Integrated Circuits Protection of Undisclosed Information Control of Anti-Competitive Practices in Contractual Licenses Exclusive grantback conditions, coercive package licensing, etc.

Exhaustion: For the purposes of dispute settlement under this Agreement, subject to the provisions of Articles 3 and 4 nothing in this Agreement shall be used to address the issue of the exhaustion of intellectual property rights (Art.6)

TRIPs & Doha Paris, Berne, Rome, Washington

PLUS TRIPs IPRs

Art. 40: Control of Anti-Competitive Practices in Contractual Licenses 1. Members agree that some licensing practices or conditions pertaining to intellectual property rights which restrain competition may have adverse effects on trade and may impede the transfer and dissemination of technology.

Art. 40: Control of Anti-Competitive Practices in Contractual Licenses (II) 2. Nothing in this Agreement shall prevent Members from specifying in their legislation practices or conditions that may in particular cases constitute an abuse of intellectual property rights having an adverse effect on competition in the relevant market. As provided above, a Member may adopt, consistently with the other provisions of this Agreement, appropriate measures to prevent or control such practices, which may include for example exclusive grantback conditions, conditions preventing challenges to validity and coercive package licensing, in the light of the relevant laws and regulations of that Member.

Objectives Art. 7: The protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations

Principles Art. 8.1: Members may, in formulating or amending their laws and regulations, adopt measures necessary to protect public health and nutrition, and to promote the public interest in sectors of vital importance to their socioeconomic and technological development, provided that such measures are consistent with the provisions of this Agreement

Principles (II) Art. 8.2: Appropriate measures, provided that they are consistent with the provisions of this Agreement, may be needed to prevent the abuse of intellectual property rights by right holders or to resort to practices which unreasonably restrain trade or adversely affect the international transfer of technology

Main Patent Provisions: Rights Conferred Part 2, Section 5, Art. 28: Exclusive right to make, use, offer for sale, sell (or import) a product Exclusive right to use a process and to use, offer for sale, sell or import for these purposes at least the product obtained directly by this process

Excludable from Patentability Inventions whose commercial exploitation needs to be prevented to protect human, animal or plant life or health (Art. 27.2) Diagnostic, therapeutic and surgical methods for treating humans or animals (27.3.a) Plants and animals other than micro-organisms (27.3.b)

Exceptions to Rights Conferred Members may provide limited exceptions to the exclusive rights conferred by a patent (Art. 30), such as: Prior art Bolar Exception Research Exemption

Other Use Without Authorization of the Right Holder (a: grounds) not limited under TRIPs: National emergency Extreme urgency Public non-commercial use by the government (incl. third parties authorized by the governments) To remedy an anti-competitive practice Patent dependency

Other Use Without Authorization of the Right Holder (b: conditions) Conditions for Compulsory Licenses: Case-by-case approach No voluntary license (can be waived) Information of the right holder in case of waiver Scope and duration shall be limited Non-exclusive, non-assignable Predominantly for the domestic market (31.f) Right holder shall be paid adequate remuneration (31.h) Subject to judicial reviews or other independent reviews by distinct higher authorities in the respective member

Exhaustion of Rights For the purposes of dispute settlement under this Agreement, subject to the provisions of Articles 3 and 4, nothing in this Agreement shall be used to address the issue of the exhaustion of intellectual property rights (art. 6)

IPR covered Subject Matter Main fields Patents New, Non-obvious, industrial applicability Innovative industries, technical inventions Trademarks Signs or Symbols All industries (goods and services) Copyrights and related rights Works of authorship, artistic performances Printing, entertainment, software, broadcasting Integrated Circuits Original Layout designs Microelectronics Industry Sui Generis PVP protection Plant varieties, (D,U,S) Agriculture and Foods Industry Trade Secrets Secret Business information All Industries Industrial Designs Ornamental Designs Clothing , automobiles, etc. Geographical Indications Geographical origin of goods and services Wines, spirits and other (food) products Source: Unctad

Type of IPR not covered Subject Matter Main fields Utility Models Functional Models/designs Mechanical industry Sui generis protection Databases Data generation, compilation, aggregation Traditional Knowledge (and Folklore) Farmer varieties, medicinal plants, indigenous skills ???

Type of IPR covered Implications for Nepalese companies/research facilities, society, specific interest groups Patents Reward of state-of-the art inventions, research incentives, exclusivity of use, temporarily higher prices Trademarks Exclusive right to use specific signs or symbols to identify goods and services, marketing tool, border measures Copyrights and related rights Protection of literary and artistic works, incl. computer programs, “expression vs. idea”, border measures Integrated Circuits Protection of layout design and extension to the industrial articles incorporating them, no bona-fide exemption Sui Generis PVP protection Incentive to develop new varieties of plants, pre-condition for the import of pre-products/seeds (and export) Trade Secrets Protection of undisclosed information, possibly additional incentive for FDI and Technology transfer Industrial Designs Protection of (non-functional) designs which are new or original, incentive for artistic creation Geographical Indications Marketing Tool, public right (state or associations), higher prices, luxury niches, “Himalayan Coffee”

Implications for companies/research facilities, society Type of IPR not covered Implications for companies/research facilities, society Utility models protection of incremental/minor inventions, immediate protection, meant as second-tier patent protection for SMEs Sui Generis Databases Protection of compilations of data the content of which is or is not copyrightable Trad.Knowledge Incentive to maintain and develop traditional knowledge, farmer varieties, beneficial ecological effects

Basic Conclusions The adoption of minim standards on IPRs will put all developing countries on an equal footing in these matters. Therefore, whatever the current importance of IPRs is as determinants of FDI, technology transfer, local innovation and trade flow is, once the Agreements become fully applicable other factors (availability of skills, R&D infrastructure, macroeconomic policies, etc.) will have an overriding influence of such flows and activities.

Basic Conclusions (II) The implementation of the Agreement should be accompanied by the enactment or improvement of legislation to deal with anticompetitive practices, including abuses of IPRs and restrictive practices in licensing agreements IPRs related to incremental innovations in industry should be considered with particular care. The promotion of innovativeness and creativity certainly are essential in any developmental strategy, particularly in order to enhance international competitiveness of firms. The role of IPRs in this regards should not be only limited to `major` innovations.

DON’t: do nothing, just react Basic approaches 1. imitate and catch up 2. innovate and catch up 3. wait and imitate (2nd round) 4. wait and innovate 5. don’t wait but integrate 6. act and attract 7. leap-frogging 8. provide for an innovation-friendly environment 9. provide for the instruments to prevent abuses DON’t: do nothing, just react bbb

Basic requirements Understand TRIPs comprehensively Preserve the flexibilities under TRIPs Avoid any TRIPs plus obligations In potential future agreements try to incorporate and fix TRIPs flexibilities Don’t allow Trips flexibilities to be traded off against concessions in other fields Develop a coherent IPR policy and strategy Use IPRs to foster your technology and industrialization strategy Implement a strong competition law to prevent abuses (competition-friendly, not cartel-friendly)

Industry tasks INNOVATE!!! 1. develop a profound understanding 2. define needs and limits 3. lobby your interests 4. cooperate with government and legislators 5. make use of the instruments INNOVATE!!!

First steps towards a consistent IP policy Line of industry Which IPR instruments are relevant? Implications of TRIPs minimum standards Leeway to mitigate negative effects Preconditions to benefit from the system Incentives to harnass IPRs for the technological development Related legal and institutional environments catering for the incentives Strong competition policy to prevent the abuse of IPRs Learning from others

Thank you seiler.achim@yahoo.de