OP-ED: Extension of TRIPS flexibility for LDCs – What does this mean for Bangladesh?
File photo of Garment employees working in a sewing section of Fakhruddin Textile Mills Limited in Gazipur, Bangladesh February 7, 2021 Reuters
Bangladesh should take the necessary initiatives to strengthen national human and institutional capacities to ensure and enforce TRIPS compliance
At the meeting of the Council for Trade-Related Intellectual Property Rights (TRIPS Council) of the World Trade Organization (WTO) held on June 29, WTO members agreed to extend the transition period for LDCs with regard to the implementation of the TRIPS Agreement for another 13 years, until July 1, 2034.
The decision was made against the background of the earlier extension granted for eight years, effective from July 1, 2013, which was due to expire on July 1, 2021.
What does this decision mean for Bangladesh?
This is a relevant question to ponder.
As can be recalled, the WTO TRIPS Agreement entered into force with the creation of the WTO in 1995.
The agreement covers a range of areas in the areas of copyright, trademarks, industrial designs, patents and others that are related to the protection of trade-related intellectual property rights (IPRs).
The TRIPS Agreement covers both the initiation of obligations and the application of disciplines in areas related to intellectual property.
A member country has the right to have recourse to the dispute settlement mechanism (DSM) of the WTO, against another member, in the event of a violation of the provisions of the agreement by a member country.
However, given the likely challenges that LDCs might face in implementing the Agreement, the TRIPS Agreement granted these countries a ten-year transition period under Article 66.1 of TRIPS.
Within this framework, LDCs were allowed to be exempted from most of the obligations under the agreement (with the exception of national treatment and most-favored-nation treatment).
Members recognized that LDCs faced formidable economic, financial and administrative constraints and that they would need more time and flexibility to be able to create a viable technological base, put in place mechanisms for enforcement, build institutional capacity and develop human resources to comply with TRIPS obligations.
The transition period offered Bangladesh and other LDCs a much-needed respite from the obligation to enforce IPR disciplines as envisioned in the TRIPS Agreement.
Undertake and enforce compliance requirements related to copyright, patents, designs, etc. would have been very onerous and virtually impossible for LDCs like Bangladesh.
Indeed, companies, investments and commercial interests in LDCs have been able to derive considerable benefits from the TRIPS transition decision through flexibilities in the areas of compliance and enforcement and, therefore, by maintaining the production costs at a low level.
However, the reality is that LDCs have not been able to overcome many of the challenges associated with building their capacity in IPR-related areas despite repeated extensions.
In addition, developed countries have failed to provide the support promised to strengthen the capacities of LDCs in the areas concerned.
In view of the persistent difficulties faced by LDCs in the areas of TRIPS compliance, invoking Article 66.1, the exemptions for LDCs were first extended in 2006, when the initial ten-year transition period has ended.
Thus, the transition period for LDCs has been extended by a further 7 years, until July 1, 2013.
This was extended a second time, for eight years, until July 1, 2021.
The aforementioned thirteen-year extension of 29 June 2021, the longest to date, must be seen as a victory for LDCs.
They had previously submitted a proposal to the TRIPS Council, taking advantage of Article 66.1 which stipulated that an LDC could submit a duly motivated proposal in the TRIPS Council supported by arguments justifying the request for extension of flexibilities.
Although such a proposal was submitted by Chad, on behalf of the LDCs as the Coordinator of the LDC group at the WTO, it should be noted that Bangladesh had played a key role of crucial importance in the process. steering of the proposal to the TRIPS Council.
It was not, however, an easy task.
Many developed WTO members, including the US and the EU, had previously expressed reservations about granting a further extension to LDCs.
Ultimately, however, the TRIPS Council’s decision to extend was a consensus decision, thanks to the collective strong position of the LDCs and the support of developing and developed member countries who took note of the exacerbation of the difficulties faced by the LDCs. the economies of LDCs, especially in the context of the ongoing Covid-19 pandemic.
It should be mentioned in this regard that the initial communication from LDCs to the TRIPS Council requested an extension of the transition period âas long as the member has remained an LDC and for an additional period of 12 years from the date of termination. reclassification of a member of the LDC group.
As can be seen, the last part of this communication was of particular interest to Bangladesh.
If the LDC submission was accepted, Bangladesh could have benefited from the flexibilities of the TRIPS Agreement for another 12 years after its withdrawal scheduled for 2026 (i.e. until 2038).
As expected, Bangladesh and other LDCs scheduled for graduation have vigorously defended this case in the TRIPS Council, with the support of the LDC group and a number of other members of the TRIPS Council. WTO.
However, while some delegations were inclined to extend flexibilities to reclassified LDCs, although perhaps for a shorter time horizon than requested in the communication, others argued that extending the transition period for graduates LDCs after their reclassification would go beyond the mandate of the TRIPS Agreement. Advice in accordance with article 66.1.
Ultimately, failing to reach consensus, it was agreed that the post-graduation flexibility element of the LDC proposal should be pursued in the WTO General Council (WTO-GC).
As a reminder, the LDCs have already submitted a proposal to this effect to the Board at its meeting in December 2020.
Here too, Bangladesh had played a leading role in preparing the proposal and in vigorously defending the cause at the aforementioned board meeting.
What are the possible implications of the TRIPS flexibility decision of June 29, 2021 for Bangladesh?
First, by all accounts this was a significant achievement for the LDCs – they were able to secure a consensual extension of the transition period for the LDCs, for the third time in a row.
While LDCs were unable to achieve their agenda to the fullest (to take advantage of flexibilities as long as one member remained an LDC), they were able to negotiate a thirteen-year extension, the longest so far.
Second, as noted, members were unable to reach consensus on the LDCs proposal to extend the transition period for LDCs by 12 years after graduation.
However, the fact that members have agreed to discuss the proposal at the WTO Governing Council should be taken as a welcome signal.
LDCs should pursue the cause within the CG in a very serious manner, with Bangladesh continuing to provide the intellectual leadership in this context.
It is conceivable that during the discussions, LDCs will be invited to make concessions on the timing of a possible extension for graduated LDCs and to agree to a shorter transition period.
The next WTO Ministerial Conference in Geneva, to be held from November 30 to December 3, 2021, will be an appropriate opportunity to proactively pursue this cause at the highest (ministerial) level.
Here too, Bangladesh should play an active role, with the necessary diplomatic work to be done before the ministerial meeting.
Bangladesh has a great interest in this issue.
Third, while there is no extension of the TRIPS exemption for graduated LDCs, the June 2021 decision itself grants Bangladesh an additional five years to prepare for the compliance regime. to TRIPS before its graduation scheduled for 2026.
Bangladesh should determine what TRIPS compliance would entail in terms of the regulatory framework, analyze the implications for patents, copyright and other trade-related IPR policies and regulations, and identify how to invest, the country’s commerce and business could be affected.
Bangladesh should take the necessary initiatives to strengthen national human and institutional capacities to ensure and enforce the TRIPS Agreement.
The private sector will need to be encouraged to adopt TRIPS-compliant trade and investment practices.
Fourth, even if Bangladesh (and other exiting LDCs) are able to secure an extension of TRIPS exemptions, for a period of time, after exiting the LDC group, it will be prudent to prepare and d ” gradually move towards a political regime in accordance with TRIPS. .
Bangladesh is currently negotiating Free Trade Agreements (FTAs) and Comprehensive Economic Partnership Agreements (CEPA) with other countries.
Partner countries in such agreements often tend to WTO plus obligations in areas relating to the enforcement of intellectual property rights.
Foreign investors and multinational companies also tend to prefer doing business with countries where intellectual property rights are respected and properly enforced.
Thus, it will be prudent for Bangladesh to opt for a two-pronged strategy: vigorously pursue the cause of the extension of TRIPS flexibilities for LDCs after their withdrawal from LDC status, during the General Council of the WTO and the next MC12, and at the same time, take the necessary measures to gradually put in place a political regime in accordance with TRIPS and strengthen institutional and human capacities for the enforcement of IPRs.
The author is a distinguished member of the Center for Policy Dialogue (CPD)