PHARMACEUTICAL INDUSTRY IN EUROPE
7. Opposition of developing
7.3 THE IP DEMANDS OF DEVELOPING COUNTRIES AND LDCS DURING THE 1999 WTO MINISTERIAL
7.3.1 Demands Concerning TRIPs Structure – Technology Transfer, Non-violation Disputes and Transitional Periods
Both before and during the Seattle ministerial meeting, developing countries and LDCs argued that the TRIPs provisions dealing with the supply of technical, financial and technological assistance to these countries are ineffective.
Kenya, on behalf of the African Group, fiercely questioned the efficacy and practicality of Art. 66.2 – transfer of technologies from developed countries to LDCs:
The provisions of the Article (66.2) are couched in ʻbest endeavourʼ terms. Best endeavour provisions are fundamentally flawed in that they are neither enforceable nor do they constitute a real benefit for developing countries and least-developed
countries. Consequently many developed countries have as yet not demonstrated how they are fulfilling the provisions of this Article.9
As a solution, Kenya proposed monitoring the implementation of Art. 66.2 by developed countries, using a full and a regular WTO review.10
Venezuela requested that Art. 66.2 be extended to developing countries in addition to LDCs.11 It also requested a review of TRIPs objectives and principles, as laid out in Art. 7 and 8, in order to make them more operational.12 Moreover, Venezuela proposed that WTO members establish e-commerce mechanisms that would strengthen and induce technological transfer to developing countries and LDCs.13 Similar views were also presented by Colombia.14
India submitted the most detailed proposal concerning the establishment of an operational WTO technology transfer mechanism, which included the field of IPRs.15 Noting that TRIPs has a central role in the transfer of technologies to developing countries, India argued that ʻthe need of the hour is therefore to strengthen the language in existing agreements to make the provisions legally binding commitmentsʼ16. Indiaʼs proposal was to establish a working group on the transfer of technology that would aim to:
1. Identify the technology-transfer constraints faced by developing countries.
2. Look at existing WTO agreements for the purpose of making the necessary adjustments for technology transfer to developing countries at advantageous terms.
3. Consider the reasons that existing technologies were not transferred to developing countries.
4. Factor technology transfer issues critical to developing countries into all future negotiations.
5. Investigate the possibility of establishing an institutional body within the WTO Secretariat dealing with technology transfer.
6. Offer specific support measures to ensure technology transfer from developed countries to developing ones.
7. Focus on the incentives that developed countries grant to enterprises and institutions in their own countries in order to disseminate and transfer technologies to developing countries.17
Developing countries and LDCs also sought to modify the issue of non- violation disputes (Art. 64.2 and 64.3). As we saw in Chapter 6, the Council for TRIPs had to convene and reconsider the scope and modalities of non-violation complaints in order to submit its recommendation to WTO members by the end of 1999. Many developing countries and LDCs held the view that, due to the lack of attention given to this topic, there is a need to extend the five-year
moratorium periods on such disputes in order to allow the council to have more time to consider its recommendations. As described by Latvia:
In light of the lack of clarity regarding even the relevant basic notions with respect to the complaints of the type under subparagraphs 1(b) and 1(c) of Article XXIII of GATT 1994 made pursuant to the TRIPs Agreement, the genuine complexity of the issues involved and the divergence of views as to their applicability, the CEFTA countries and Latvia believe that further analysis is needed.18
On that basis, Latvia proposed preserving the moratorium on non-violation disputes, as set by Art. 64.2, as long as the recommendations submitted by the TRIPs Council were not approved by the ministerial meeting.19 Identical requests came from other WTO members, such as the African Group, Colombia, Venezuela and Canada20. The latter, which traditionally held less protective IP views than those of the US and the EU, justified its opposition to the inclusion of non-violation disputes on social grounds:
The non-violation remedy was developed in a context wholly different from TRIPs as a means of ensuring market access. In Canadaʼs view transplanting this remedy into the TRIPs environment is not suitable in the context of IP and will introduce uncertainty into the Agreement, constraining Membersʼ abilities to introduce new and perhaps vital measures such as those related to social, economic development, health and environmental objectives.21
Finally, and most importantly, developing countries and LDCs, such as Pakistan, Bangladesh, Cameroon, Senegal and Morocco, proposed extending the transitional periods (2000 and 2005 respectively) at the end of which they were required to fully implement TRIPs.22 Deferring TRIPs implementation was based on the argument that, over the years, it had become evident that TRIPs did not benefit countries with weak IP capabilities. As put forward by Pakistan:
The costs of the TRIPs Agreement are becoming especially evident. The balance between producers of intellectual property, mainly the industrialised countries, and the developing country users has been heavily tilted in favour of the former – through higher levels of protection, longer periods of monopoly rights and more stringent requirements to enforce these rights. One immediate fallout has been the increase in prices of pharmaceuticals and chemicals due to higher levels of patent protection.23 Senegal went even further arguing that the TRIPs agreement was actually a barrier to its future growth:
The provisions of certain Agreements, instead of fostering development have become constraints to growth. The benefits arising out of compliance with the TRIPs Agreement, for example, must be measured against the substantial cost of such compliance and the increased price of products with significant intellectual property components. This could really retard technological development essential for the future economic development of the developing countries.24
7.3.2 Demands Concerning TRIPs Pharmaceutical and