Waiver of the TRIPS Agreement During COVID-19: Critical Analysis
Introduction
The Trade Related Aspects for Intellectual PropertyRights (TRIPS or agreement) is considered to be the most comprehensive multilateral agreement that allows its members to have extensive protection for their intellectual property, along withother enforcement procedures, dispute resolution mechanism and remedies. TRIPS being a multilateral agreement on IP involves copyright, industrial designs, patents and trade secrets wherein itaims to lay down certain minimum standards which have to be followed by every member state.
The Uruguay round of negotiations which resulted in the formation of WTO in 1995, accounted for various disputes between the developed and developing nations in regard to strict protection ensured by TRIPS agreement.In reference to this, Article IX.3 of the Marrakesh Agreement comes into place which states that under certain “exceptional circumstances” the ministerial conference has the right to waive any obligation which WTO agreements impose upon any of its members.
Due the ongoing pandemic of COVID-19, all nations across the globe have been vastly affected and have accorded a significant need towards rapid and timely access to medical facilities. The outbreak led toa global crisis because of which many developing or least developed countries faced acuteshortage of medical products.However,on the other hand, some developed countries which are more equipped with technology have started to create medicines/vaccinesto cure the disease. In order to ensure the global demand of these medical facilities, it became necessary for these manufacturing companies to supply medicines/vaccines/technology globally. However,the internationally accepted principles of TRIPS agreement,lays down stringent requirementsfor the protection of IP rights of these medicines. Thishas created a roadblock for supply of the same from one country to another without following proper process embarked in the agreement.
Aggrieved from the same, recently, India and South Africa has asked for a temporary waiver on the obligations under the TRIPS at the WTO (World Trade Organization) in order to fight COVID-19 pandemic with better access to vaccines and technologies to people around the world.In reference of the same, this article analyses the current claim for waiver of obligations under TRIPS by focusing on the protection to developing and least developed countries.
Existing Flexibilities under TRIPS agreement promoting ease in public health
The WTO Doha Declaration on the TRIPSAgreement and Public Health, agreed by WTO members in 2001, was framed in order to address the public health problems faced by developing or least developed countries.Keeping this in mind, certain flexibilitieshave been incorporated under the agreement.
Exhaustion of patent rights and Parallel imports: Due to various factors, the price and availability of generic medicines differ in countries, making it lower in one country and higher in another. The concept of parallel importation “refers to goods produced and sold legally, and subsequently exported”i.e. goods are legally acquired with the consent of right holder and then subsequently sold at lower prices through unfair trade channels in the same market or another.
Similarly, under the principle of exhaustion, once the patent holder has put a product on market, then he ceases to have anyrights over that product and therefore, he cannot hinder the resale of the same.
Compulsory licencing and Government Use: Moreover, Article 31(f) of TRIPS provides for compulsory licence that allows a third party to exploit the product patented with some compensation given to the patent holder. There are conditions that are supposed to be met for the same — Firstly, the country claiming for the same (other than LDC)should provide sufficient proof to the TRIPS council that the import is necessary because of no availability of the same in that country and no manufacturing capacity to produce the same. Secondly, the importing country has already issued or intended to issue a compulsory licence for the patented product.
Furthermore, Government use allows states to exploit the patent without the consent of the patent right holder when it is a situation of national emergency or extreme urgency.With government use exceptions there is an additional advantage as it allows the license to be issued in a speedy manner, without the need for prior negotiations with the owner.
Volunteer licencing: It is the arrangement where the patent holder allows the use of patented product to a third party with respect to an agreement in order to make affordable access of the product in question.
Insufficiency of the flexibilities to current scenario
The TRIPS flexibilities were introduced to provide for affordable medical facilities, butthey certainly have implementation issues in the recent context of COVID-19 era forsome countries. In the current proposal, India and South Africa have highlighted these complexities in TRIPS which essentialise the waiving of certain obligations under it.
Notably, there are various limitations with respect to the implementation of flexibilities such as incorporation of the same in the national laws, pressures from their trading partners, or lack the practical and institutional capacity required to exercise and the flexibilities being very restricted because the other protections of IP than patents are less understood and implemented.
Furthermore, the mechanism of compulsory licencing provided by Article31 and Article 31bisof the TRIPS Agreement contain restrictions based on territorial and procedural requirements that results in making the process of issuing compulsory licenses a complex one, thereby it is difficult for countries to collaborate.
The issues under Article 31(f) were recognised under the WTO on Doha declaration on TRIPS and Public Health. It stated:
“We recognize that WTO members with insufficient or no manufacturing capacities in the pharmaceutical sector could face difficulties in making effective use of compulsory licensing under the TRIPS Agreement. We instruct the Council for TRIPS to find an expeditious solution to this problem and to report to the General Council before the end of 2002.”
Furthermore, after the amendment of 2017, Article 31bis was introduced solely to allow the production and export of affordable medicines to countries that do not have sufficient manufacturing ability or capacity to produce the same. However, the same amendment has been widely criticised due to the cumbersome process of export and import of the drugs and the problem of economies of scale with most developing nations. This is evidently why it has only been used oncetill now when Canada, in 2007 applied for a licence for AIDS drugs provide to Rwanda. Article 31bis stipulates that any product produced and exported under a compulsory license must be determined with specific packaging and quantities, this requirement is considered to result into delays where countries need urgent access to medical toolsin the context of COVID-19.
Nonetheless, the benefit of voluntary licencing also cannot be used because the voluntary licenses are often executed in a secret manner where the patent holder deliberates conditions and determines the ultimate beneficiaries and how will it be made accessible to third parties where again developed nations will have no incentive to share the same with non-developed ones. Therefore, the insufficiency shows the need for waiving someobligations under TRIPS.
Conclusion
During such unprecedented times of COVID-19, it has become the need of the hour to accelerate the healthcare system in all countries to avoid causing anyheath crisis. It becomes necessary that most people get vaccinated as soon as possible and the healthcare system stays equipped to protect many lives. In these times of global emergency, it is important that the WTO members work together in order to ensure that the given protection for their Intellectual property does not create barriers for easy access to medical essentials like vaccines, technology, or research to fight with the novel coronavirus.
Furthermore, most developed nations, can choose to not implement the waiver in their domestic legislations, but they can try not coming in the way of international collaboration for development towards COVID-19.
Author: Anusha, 4th Year, Institute of Law, Nirma University.
Email id: anushashekhawat3@gmail.com
