WASHINGTON, DC — The sun may be setting on multilateral policymaking in intellectual property in the eyes of industry, but leading United States and European Union representatives insist on its continued vital role in trade and economy. But a “new narrative” is needed as they emphasise bilateral and plurilateral agreements.
A panel entitled “Has the Sun Set on Multilateral Rulemaking on IP?” was held at the US Chamber of Commerce Global IP Summit on 6 November.
Pavel Svoboda, chair of the European Parliament Committee on Legal Affairs (JURI), said JURI has a broad competence and is responsible for IP law, among other issues.
The committee visited US counterparts in Washington, DC last week. The main reason for their visit was to hold exchanges of views with officials and stakeholders on matters including substantive IP law.
Exchanges included the Supreme Court, with Justice Breyer, representatives of the Obama administration including the US IP enforcement coordinator, US Patent and Trademark Office (USPTO), US Copyright Office, Office of the US Trade Representative (USTR), and of the House of Representatives Judiciary Committee, industry representatives and civil society, he said.
On multilateral rulemaking in IP, he highlighted three “very timely” questions involving IP relating to the 28 member states of the European Union. These are the Transatlantic Trade and Investment Partnership (TTIP), reform of copyright in the digital environment, and geographical indications.
On the TTIP IP chapter, the two sides have so far agreed on four sections, he said. These are: a list international treaties to which both are party; general principles such as IPRs as a tool for innovation, growth and jobs; and targeting legal commitments, and identifying areas for cooperation.
The European Commission negotiates on behalf of the EU, and published a position paper on 20 March on these sections. The EU is still waiting for the US side to identify its priorities, he said.
Svoboda described activities on different IP rights, including patents, trademarks, and copyright.
On copyright, he said the Commission “has identified the reform of copyright to the digital environment as a priority as part of the setting up of the Digital Single Market, which is intended to remove barriers to the internal market in the digital arena.”
A legislative proposal on the cross-border portability of copyrighted works will be presented in December, and a further proposal on other forms of so-called geo-blocking will be presented in the spring of 2016, he said. “They are likely to propose further harmonisation of national legislation, in particular limitations and exceptions to copyright,” said Svoboda.
The European Parliament and the Committee on Legal Affairs are closely monitoring these developments, he added, and have set up a working group to review the different options for policy reform, and to hear the views of stakeholders.
Parliament in July adopted a resolution aimed at further harmonising limitations and exceptions to copyright, giving recommendations to the Commission on the upcoming reform. He said recommendations include:
“[O]n the difficult balancing act on the expectations of consumers to have easy and cost-effective access to culturally diverse content on the one hand, and remuneration for authors and right holders on the other, as well as questions on the responsibility and liability of intermediaries. One widely discussed question has been that of text and data mining, an exception for which could benefit scientific research. Another is a recommendation to the Commission to further identify the possible benefits of a future pan-European copyright title, should one be possible, for instance on a voluntary basis, with a central registration office, primarily for evidentiary purposes and not as a requirement for acquiring any rights. Any such reform will of course have to take place within the framework of the existing agreements. This discussion is sure to intensify in the coming months.”
“We live in interesting times indeed when it comes to copyright,” said Svoboda, but noted that the copyright reform question is not part of the TTIP negotiations.
GIs: Vital Economic Component or Tail Wagging the Dog?
Svoboda and George York, deputy assistant US Trade Representative (USTR) for intellectual property and innovation, swapped differing views on geographical indications, products with particular characteristics from certain geographical regions.
Svoboda said GIs are “very much” part of the TTIP negotiations, and stressed the importance of this form of IPR to the European Union as a cultural area and concerning products such as wine and cheese.
He said GIs are “economically very important,” with about 20 percent of GI products from the EU being exported for a total of 11.5 billion euros. The US is by far the leading destination country with 3.4 billion euro in imports of GI products, which accounts for 34 percent of its food and beverage imports from the EU, he said.
“The efficiency of the EU GI system is the basis for the competitiveness and success of our high quality, high value products,” said Svoboda. “When it comes to the current bilateral agreement between the US and EU on wine and spirits, the protection of these quality products has been a decisive factor in the success of US and EU exports in the sectors.”
He quipped that it would be “interesting” to see how the election of Paul Ryan of the cheese-producing state of Wisconsin as the US Speaker of the House will influence the discussion.
“The issue of GIs will continue to be high on the agenda for discussion in TTIP in the coming year,” he said. And in parallel, EU institutions are discussing the possibility of a pan-European system for the protection of non-agricultural GIs.
USTR negotiator York, for his part, opened by stressing that people in the US need to understand why IP rights are critical to its economy and society. For instance, he said, US services exports have a surplus, unlike its goods exports, “and that’s driven by value by IPR and IPR licensing.”
“This is a critical feature of our economy, not only for the jobs it creates, but the things it creates, the goods and services, the innovation, life-saving medicines and so forth,” York said.
He said multilateralism is one part unilateralism, one part bilateralism – as they have to work with key allies – … and plurilaterism. He said at WIPO, the US has its “friends of inclusiveness.” At the World Trade Organization, it has the “friends of innovation,” working with partners (both developed and developing) to “identify narratives,” on why IP is important to those countries.
But, he said, “sometimes multilateralism can become stale. I’ve seen notes from some of my Indian colleagues that are literally yellow, they haven’t changed in a long time. So we need to reimagine how we talk about IP.”
“We know it’s important, but sometimes we have to come up with a new narrative, a new vocabulary,” said York.
On GIs, York countered Svoboda’s positive statistics with some data he said shows that GIs are a very small part of the overall EU economy, benefiting only a few EU members.
“Our data shows that out of the European Union, this is a relatively niche production, and it has the potential to be the tail wagging the dog of a really important discussion between the transatlantic communities about what’s really critical to our economies,” he said.
The EU has produced studies that talk about the job growth, and GDP value by member state of various forms of IP, he said. And GIs rank in “a distant last,” he said, accounting in 13 member states for “0.0 percent” of jobs, and in 10 member states, “0.0 percent of GDP.” Very few member states go above .1 percent for employment with GIs as a percentage of total agricultural production, he said.
“Total agricultural production of GIs in Europe is 5.7 percent. This is quite low,” he said, adding, “That means non-GIs account for basically 95 percent of production and 98 percent of exports of the EU.”
He further said that in the EU, GIs have shown “wild fluctuations” in premiums obtained. And he remarked on Europe’s move to extend GIs to non-agricultural products by quipping, “We’re looking forward to losing our ability to uses Argyle socks here in the United States.”
York said EU GI products do “staggeringly well” in the US market, while conversely, US products that are competing with GIs in Europe are blocked there. He said for instance that American feta cannot be sold, even though several EU countries make and sell feta in the EU market.
“Our guys can’t get into the EU because of GI-related IP market access barriers,” he said. “The TRIPS Agreement talks about legitimate products and IPR protection, but IPR protection should not lead to illegitimate trade barriers.”
“What’s important for this group is that multilateralism not be driven by niche issues,” York concluded.
WIPO Work Positive, But Last Assemblies “One for the Record Books”
Paul Salmon, US Patent and Trademark Office (USPTO) senior counsel in the Office of Policy and International Affairs, talked about the World Intellectual Property Organization, giving a strongly positive view on the UN agency’s work despite difficulties in treaty negotiations.
“WIPO just held its annual meeting in October, and the narrative is that WIPO is broken, WIPO is stuck in the norm-setting area, but I think people don’t recognise that WIPO is actually making tremendous progress beneath the radar,” he said. In particular, he said “WIPO runs three very successful registration systems, one for the patents, the Patent Cooperation Treaty system, for trademarks the Madrid system, and for industrial designs the Hague System, that fund 95 percent of WIPO’s budget.”
“The US and EU agree on 99.9 percent of all issues in WIPO, and have used it as a proving ground to advance the protection of IP globally from its earliest days,” he said.
“We’ve seen norm-setting stall in the past, but WIPO had an incredible productive era of norm-setting just after the TRIPS agreement. The landmark WIPO internet treaties are one example,” said Salmon.
He did say that this year’s annual WIPO General Assemblies in October “was one for the record books.” He said it “went until 5:45 am, but decisions were made on all of the substantive items and they were positive.”
Salmon highlighted the “recognition that one registration system at WIPO related to appellations of origin, the Lisbon System, had taken an action to expand its mandate without the approval of the full [WIPO] membership.”
“The United States and other ‘friends of inclusiveness’ that George [York] referred to, insisted that this system now become responsible for its own financing,” he said. “That did take up a lot of the air in the room during the WIPO Assemblies. Some people called what is known as the “GA” [General Assemblies] the “GI” this year because GIs loomed so large. But we think the result was a success in that Lisbon members took ownership of their system, and recognised that they have to find solutions to funding.”
Salmon then highlighted USPTO initiatives that are “bearing fruit,” such as the trilateral group (US, EU, Japan), and the IP-5 (trilateral plus China, Korea), which account for 80 percent of the world’s patent filings, and 95 percent of all work done under the Patent Cooperation Treaty. This makes close cooperation critical to advancing the multilateral level, he said.
Salmon took the opportunity to list several upcoming events being hosted by the USPTO. In December, the “Trademark 5” are meeting on 1-2 December for a number of cooperation projects, including one called trademark identification. There are now some 16,000 trademark goods and services identifiers that have been harmonised, which will help protect trademarks around the world in those five offices, he said.
And the inaugural meeting of the “Industrial Design 5” will meet on 4-5 December. There are a number of projects to advance work among those offices as well as in WIPO.
And then in May, the IP-5 will be hosted at USPTO, he said. Work done by these offices includes the Patent Prosecution Highway, which now has 30 countries, that greatly facilitates getting patents in multiple jurisdictions much quicker and much cheaper. The Global Dossier is another initiative that will ultimately be a single portal for … patenting in multiple jurisdictions, bringing many of the advantages of the PCT at greatly reduced costs.
Industry: ‘Late in the Night’ for Multilateral IP Policy
Stephen Ezell, vice president for global innovation policy at the Information Technology & Innovation Foundation (ITIF), said it was asked if the sun is setting on multilateral rulemaking on intellectual property. “Unfortunately, I think that it’s getting late in the night at least,” he said. “The reality is that too many in the global development community still view strong intellectual property rights as a hindrance to developing country economic growth.”
For example, he cited the United Nations Conference on Trade and Development (UNCTAD), which he said in its 2014 Trade and Development Report wrote: “strong IP protection may have little or no impact on innovation, while reducing the … of core inputs and technologies and their cost.”
He remarked, “That’s astounding. A recent World Bank report wrote that TRIPS [the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights) extracts at least $20 billion in rents annually from developing countries to technology-creating countries in the form of pharmaceutical patents, industrial designs, and other forms of IP.”
And, he said, India recently went before the TRIPS Council and argued that TRIPS establishes a ceiling in terms of IP.
“In short, I think it’s quite disappointing that at a time when intellectual property has become more important to the global economy and economic growth than ever, in some corners the global consensus regarding IP’s role in economic growth has unfortunately actually waned,” he said. “I think too often countries take the short-term expediency route at the expense of the longer term maximising global innovation route and perspectives toward IP. Take the debate over access to medicines, too many countries would rather have access to all medicines available today and maybe even a little bit of their manufacturing, even if it means sacrificing a system that incentivises investment…. In other words, too many countries are trading today for tomorrow.”
Chamber Applauds Time-Limited LDC Waiver at WTO
Separately, Chamber Global IP Center Executive Director Patrick Kilbride offered an editorial comment as panel moderator. He said to US negotiator Salmon: “We want thank you and your colleagues for securing a time-limited LDC waiver on implementation of pharmaceutical aspects of TRIPS. If there’s one core issue … in the multilateral space, it’s to end the perpetuation of the notion that intellectual property is somehow a barrier to access to innovative products or to development.”
“Telling developing nations not to implement IP is like telling them not to build roads and ports,” Kilbride said. “It’s nonsense and we appreciate your leadership.”
[…] November 12, 2015. Nestled at the end Intellectual Property Watch’s (IP-Watch) brilliant reportage of a US Chamber of Commerce event – “Has the Sun Set on Multilateral Rulemaking on […]