TRIPS

Agreement on Trade-Related Aspects of Intellectual Property Rights, part of the World Trade Organisation (WTO)

For more context, see our entry on WIPO

Description

"The TRIPS accord, which came into force on 1 January 1995, sets out minimal standards for IP enforcement. Although the compliance period for these standards has been extended to 2016 for the world's least-developed countries, such standards threaten, nevertheless, to prevent the developing world from enjoying the free flow of ideas and their expression which so aided today's developed nations during the west's industrial age.

Combined with the trend towards extension of IPs in term and scope, TRIPS threatens to sentence the developing world to perpetual bondage by the developed one. Indeed, as Andrew Gowers put it to me on the day in late 2006 that he published his review into British intellectual property law: "[I]f you look at the whole swathe of developing countries, from the successful ones to the poor ones, does the one-size-fits-all approach [compelling adoption of an industrial nation's standard of IP protection] really work? The answer is, it makes no sense." (http://www.opendemocracy.net/media/hogge_wipo_4431.jsp)

Peter Drahos:

" TRIPS -- the World Trade Organisation's agreement on Trade-Related Aspects of Intellectual Property Rights -- was the most important agreement on intellectual property of the 20th century. It marked the beginning of a quiet revolution in the way that property rights in information were defined and enforced in an emerging global knowledge economy.

More than one hundred government ministers signed TRIPS on behalf of their nations in Marrakesh on 15 April 1994. Why? Why did states give up sovereignty over something as fundamental as the property laws that determine the ownership of information and technologies?

Intellectual property rights are not like property rights in land or the ownership of physical objects. They are property rights in intangibles -- algorithms that drive computers, formulae that underpin chemical processes of production, and methods of doing business. TRIPS is about more than patents on intangibles, however. It sets minimum standards in copyright, trade marks, geographical indications of manufacture, industrial designs and layout designs of integrated circuits. TRIPS effectively globalises the set of intellectual property principles it contains, because most countries are members of, or are seeking membership of, the World Trade Organisation (WTO) that administers TRIPS. It has a crucial harmonising impact on intellectual property regulation because it sets detailed standards of intellectual property law that will profoundly affect the ownership of two significant technologies in the 21st century -- digital technology and biotechnology. TRIPS also obliges states to provide effective enforcement procedures against the infringement of intellectual property rights.

Between them, the US, the European Community and Japan had the world's dominant software, pharmaceutical, chemical and entertainment industries, as well as the world's most important trade marks. The rest of the world had nothing much to gain by agreeing to terms of trade for intellectual property that offered these countries so much protection.

Southern policymakers have argued that "TRIPS was part of a package in which we got agriculture". The WTO Agreement on Agriculture (AoA), however, does not confer anything like the benefits on developing countries that TRIPS does on the US and Europe.5

Another response was that "we will be eventual winners from intellectual property". But property rules over knowledge have brought developing countries few gains. Of the 3.5 million patents in existence in the 1970s, the decade before the TRIPS negotiations, nationals of developing countries held about one per cent.6 Moreover, developing countries that were industrialising, such as South Korea, Singapore, Brazil and India, were doing so in the absence of a globalised intellectual property regime.

In fact, developing countries signed TRIPS because of a failure of democratic processes, both nationally and internationally, that enabled a small group of men within the US to capture the US trade-agenda-setting process and then, in partnership with European and Japanese multinationals, draft intellectual property principles that became the blueprint for TRIPS. The resistance of developing countries was crushed through US trade power." (http://www.thecornerhouse.org.uk/item.shtml?x=85821)

Discussion

The problem with TRIPS

From: http://www.lankabusinessonline.com/fullstory.php?newsID=1246593302&no_view=1&SEARCH_TERM=11

"The Trade-Related Intellectual Property Rights (TRIPS) agreement benefits developed countries such as the United States of America which earns over six billion dollars through patents.

As a result, the poorer countries have called for recognition of their right to policy space to strike a better balance within international rules and give them some protection.

"Without that protection which provides some sort of respite for infant industries, developing countries will be locked into whatever system of comparative advantage that was established by historical and other factors," Anghie says.

The comparative advantage is the ability to produce a good at a lower cost, relative to other goods, compared to another country.

It is, in many respects influenced by natural factors, a product of history or something which is made by government policies.

However, the developed countries are slow in recognising the right of policy space for developing countries due to the fear that it would enable the latter to strengthen their bargaining positions, Anghie says.

Analysts point out that history has shown that liberalization and opening as a rule is almost always beneficial to everyone in the long-term.

But agreements like TRIPS are unusual that they do the opposite, by imposing more restrictions that prevent the spread of knowledge.

Extending the life of patents for example restricts the spread of technology not only to poor countries but even within economic players in rich countries, stifling innovation and development.

This is why especially in computer software concepts like 'creative commons' and 'open source' have sprung up.

Though countries like China and India are now filing a greater number of patents, the fundamental premise of protection and restriction promoted by TRIPS stands out like a sore thumb in a sea of liberalization.

The steel industry in Sheffield in UK developed by hiring metalworkers from Germany at a time when there was no agreements like TRIPS to restrict the spread of steelmaking technology.

Better bargaining positions will enable poorer countries to avoid pressure from rich countries to undertake more liberalisation and privatisations through institutions such as the International Monetary Fund (IMF) or World Bank, Anghie says.

But developed countries point out that concession schemes such as the Generalised System of Preferences (GSP) granted to poor countries is similar to a free ride in the global trade arena.

Despite strict international rules, with sound policies, development and comparative advantage can be achieved just like in East Asia, says Anghie.

"The trade rules, even though biased against developing countries, have still created a situation which developing countries with the right policies might be able to succeed in bringing about development."

More Information

Resource book on TRIPS at http://www.iprsonline.org/unctadictsd/ResourceBookIndex.htm

Briefing paper, Who Owns the Knowledge Economy, at http://www.thecornerhouse.org.uk/item.shtml?x=85821