WTO AND TRADE RELATED INTELLECTUAL
PROPERTY RIGHTS
A Project Submitted to
ARMY INSTITUTE OF LAW, MOHALI
In partial fulfillment of the requirements for the award of degree of
B.A. L.L.B.
SUBMITTED TO SUBMITTED BY
Ms. Ekjyot Gujral Esha Ahlawat
(Prof of Economics) 2246
PUNJABI UNIVERSITY, PATIALA (PUNJAB)
2023-24
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DECLARATION
It is certified that the project work presented in this report titled “WTO and Trade Related
Intellectual Property Rights” embodies the result of original work carried out by me. All
ideas and references have been duly acknowledged.
Esha Ahlawat
2246
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ACKNOWLEDGEMENT
In preparation of my assignment. I had to take help and guidance of some respected persons
who deserve my deepest gratitude. As the completion of my assignment gave me much
pleasure, I would like to show my gratitude to Ms. Ekjyot Kaur Gujral for giving me
guidance through numerous consultations. I would also like to extend my gratitude to all
those who helped me directly or indirectly during the completion of this project.
I would like to thank my family and peers, whose constant support and motivation kept me
encouraged to work towards the completion of this assignment. I also extend my heartfelt
thanks towards Army Institute of Law, Mohali and Dr Tejinder Kaur. Principal, for providing
me with an opportunity to make my project on such an interesting and engaging topic.
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INDEX
S. NO. TOPIC PAGE NO.
1. Introduction to WTO 05
2. Introduction to TRIPS 06
3. Features of the Agreement 07
4. Substantive Standards of Protection 08-10
5. Impact on India 11
6. Criticism of TRIPS 12
7. Bibliography 13
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INTRODUCTION TO WTO
The World Trade Organization (WTO) is the only global international organization dealing
with the rules of trade between nations. At its heart are the WTO agreements, negotiated and
signed by the bulk of the world‟s trading nations and ratified in their parliaments. The goal is
to help producers of goods and services, exporters, and importers conduct their business.
It officially commenced operations on 1 January 1995, pursuant to the 1994 Marrakesh
Agreement, thus replacing the General Agreement on Tariffs and Trade (GATT) that had
been established in 1948. The WTO is the world's largest international economic
organization, with 164 member states representing over 98% of global trade and global GDP.
The WTO is headquartered in Geneva, Switzerland. Its top decision-making body is the
Ministerial Conference, which is composed of all member states and usually convenes
biennially; consensus is emphasized in all decisions. Day-to-day functions are handled by the
General Council, made up of representatives from all members. A Secretariat of over 600
personnel, led by the Director-General and four deputies, provides administrative,
professional, and technical services. The WTO's annual budget is roughly 220 million USD,
which is contributed by members based on their proportion of international trade.
Functions
1. It oversees the implementation, administration and operation of the covered
agreements (with the exception is that it does not enforce any agreements when China
came into the WTO in Dec 2001).
2. It provides a forum for negotiations and for settling disputes.
3. It is WTO's duty to review and propagate the national trade policies and to ensure the
coherence and transparency of trade policies through surveillance in global economic
policy-making.
4. Another priority of the WTO is the assistance of developing, least-developed and low-
income countries in transition to adjust to WTO rules and disciplines through
technical cooperation and training.
Dispute Settlement
The WTO's dispute-settlement system "is the result of the evolution of rules, procedures and
practices developed over almost half a century under the GATT 1947". In 1994, the WTO
members agreed on the Understanding on Rules and Procedures Governing the Settlement of
Disputes (DSU) annexed to the "Final Act" signed in Marrakesh in 1994. Dispute settlement
is regarded by the WTO as the central pillar of the multilateral trading system, and as a
"unique contribution to the stability of the global economy". WTO members have agreed
that, if they believe fellow-members are violating trade rules, they will use the multilateral
system of settling disputes instead of taking action unilaterally.
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INTRODUCTION TO TRIPS
TRIPS, short for The Agreement on Trade-Related Aspects of Intellectual Property
Rights, is an international legal agreement between all the member nations of the World
Trade Organization (WTO). It establishes minimum standards for the regulation by national
governments of different forms of intellectual property (IP) as applied to nationals of other
WTO member nations. TRIPS was negotiated at the end of the Uruguay Round of the
General Agreement on Tariffs and Trade (GATT) between 1989 and 1990, signed in
Marrakesh, Morocco on 15 April 1994. and is administered by the WTO.
The agreement covers the following areas: copyright and related rights (i.e. the rights of
performers, producers of sound recordings and broadcasting organizations); trademarks
including service marks; geographical indications including appellations of origin; industrial
designs; patents including the protection of new varieties of plants; the layout-designs of
integrated circuits; and undisclosed information including trade secrets and test data.
Intellectual Property Rights
Intellectual property rights (IPR) refer to the legal rights given to the inventor or creator to
protect his invention or creation for a certain period of time., These legal rights confer an
exclusive right to the inventor/creator or his assignee to fully utilize his invention/creation for
a given period of time.
The laws and administrative procedures relating to IPR have their roots in Europe. The trend
of granting patents started in the fourteenth century. In comparison to other European
countries, in some matters England was technologically advanced and used to attract artisans
from elsewhere, on special terms. The first known copyrights appeared in Italy.
Originally, only patent, trademarks, and industrial designs were protected as „Industrial
Property‟, but now the term „Intellectual Property‟ has a much wider meaning. IP protection
can be sought for a variety of intellectual efforts including the following:
1. Patents.
2. Industrial designs relate to features of any shape, configuration, surface pattern,
composition of lines and colors applied to an article whether 2-D, e.g., textile, or 3-D,
e.g., toothbrush.
3. Trademarks relate to any mark, name, or logo under which trade is conducted for any
product or service and by which the manufacturer or the service provider is identified.
Trademarks can be bought, sold, and licensed. Trademark has no existence apart from
the goodwill of the product or service it symbolizes.
4. Copyright relates to expression of ideas in material form and includes literary,
musical, dramatic, artistic, cinematography work, audio tapes, and computer software.
5. Geographical indications are indications, which identify as good as originating in the
territory of a country or a region or locality in that territory where a given quality,
reputation, or other characteristic of the goods is essentially attributable to its
geographical origin.
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FEATURES OF THE AGREEMENT
1. Standards
In respect of each of the main areas of intellectual property covered by the TRIPS
Agreement, the Agreement sets out the minimum standards of protection to be
provided by each Member. Each of the main elements of protection is defined,
namely the subject-matter to be protected, the rights to be conferred and permissible
exceptions to those rights, and the minimum duration of protection. The Agreement
sets these standards by requiring, first, that the substantive obligations of the main
conventions of the WIPO, the Paris Convention for the Protection of Industrial
Property (Paris Convention) and the Berne Convention for the Protection of Literary
and Artistic Works (Berne Convention) in their most recent versions, must be
complied with. With the exception of the provisions of the Berne Convention on
moral rights, all the main substantive provisions of these conventions are incorporated
by reference and thus become obligations under the TRIPS Agreement between
TRIPS Member countries. The relevant provisions are to be found in Articles 2.1 and
9.1 of the TRIPS Agreement, which relate, respectively, to the Paris Convention and
to the Berne Convention. Secondly, the TRIPS Agreement adds a substantial number
of additional obligations on matters where the pre-existing conventions are silent or
were seen as being inadequate. The TRIPS Agreement is thus sometimes referred to
as a Berne and Paris-plus agreement.
2. Enforcement
The second main set of provisions deals with domestic procedures and remedies for
the enforcement of intellectual property rights. The Agreement lays down certain
general principles applicable to all IPR enforcement procedures. In addition, it
contains provisions on civil and administrative procedures and remedies, provisional
measures, special requirements related to border measures and criminal procedures,
which specify, in a certain amount of detail, the procedures and remedies that must be
available so that right holders can effectively enforce their rights.
3. Dispute settlement
The Agreement makes disputes between WTO Members about the respect of the
TRIPS obligations subject to the WTO's dispute settlement procedures.
In addition the Agreement provides for certain basic principles, such as national and most-
favoured-nation treatment, and some general rules to ensure that procedural difficulties in
acquiring or maintaining IPRs do not nullify the substantive benefits that should flow from
the Agreement. The obligations under the Agreement will apply equally to all Member
countries, but developing countries will have a longer period to phase them in. Special
transition arrangements operate in the situation where a developing country does not
presently provide product patent protection in the area of pharmaceuticals.
The TRIPS Agreement is a minimum standards agreement, which allows Members to provide more
extensive protection of intellectual property if they so wish.
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SUBSTANTIVE STANDARDS OF PROTECTION
The following are the substantive standards of protection:
1. Copyright
During the Uruguay Round negotiations, it was recognized that the Berne Convention
already, for the most part, provided adequate basic standards of copyright protection.
Thus it was agreed that the point of departure should be the existing level of
protection under the latest Act, the Paris Act of 1971, of that Convention. The point of
departure is expressed in Article 9.1 under which Members are obliged to comply
with the substantive provisions of the Paris Act of 1971 of the Berne Convention.
However, Members do not have rights or obligations under the TRIPS Agreement, i.e.
the moral rights (the right to claim authorship and to object to any derogatory action
in relation to a work, which would be prejudicial to the author's honour or reputation),
or of the rights derived therefrom. The provisions of the Berne Convention referred to
deal with questions such as subject-matter to be protected, minimum term of
protection, and rights to be conferred and permissible limitations to those rights. The
Appendix allows developing countries, under certain conditions, to make some
limitations to the right of translation and the right of reproduction.
2. Trademark
The basic rule contained in Article 15 is that any sign, or any combination of signs,
capable of distinguishing the goods and services of one undertaking from those of
other undertakings, must be eligible for registration as a trademark, provided that it is
visually perceptible. Such signs, in particular words including personal names, letters,
numerals, figurative elements and combinations of colours as well as any combination
of such signs, must be eligible for registration as trademarks.
Where signs are not inherently capable of distinguishing the relevant goods or
services, Member countries are allowed to require, as an additional condition for
eligibility for registration as a trademark, that distinctiveness has been acquired
through use. Members are free to determine whether to allow the registration of signs
that are not visually perceptible (e.g., sound or smell marks).
Members may make registrability depend on use. However, actual use of a trademark
shall not be permitted as a condition for filing an application for registration, and at
least three years must have passed after that filing date before failure to realize an
intent to use is allowed as the ground for refusing the application.
3. Geographical Indications
Geographical indications are defined, for the purposes of the Agreement, as
indications which identify a good as originating in the territory of a Member, or a
region or locality in that territory, where a given quality, reputation or other
characteristic of the good is essentially attributable to its geographical origin (Article
22.1). Thus, this definition specifies that the quality, reputation or other characteristics
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of a good can each be a sufficient basis for eligibility as a geographical indication,
where they are essentially attributable to the geographical origin of the good.
In respect of all geographical indications, interested parties must have legal means to
prevent use of indications which mislead the public as to the geographical origin of
the good, and use which constitutes an act of unfair competition within the meaning
of Article 10bis of the Paris Convention.
The registration of a trademark which uses a geographical indication in a way that
misleads the public as to the true place of origin must be refused or invalidated ex
officio if the legislation so permits or at the request of an interested party.
4. Industrial Designs
Article 25.1 of the TRIPS Agreement obliges Members to provide for the protection
of independently created industrial designs that are new or original. Members may
provide that designs are not new or original if they do not significantly differ from
known designs or combinations of known design features. Members may provide that
such protection shall not extend to designs dictated essentially by technical or
functional considerations.
Article 25.2 contains a special provision aimed at taking into account the short life
cycle and sheer number of new designs in the textile sector: requirements for securing
protection of such designs, in particular in regard to any cost, examination or
publication, must not unreasonably impair the opportunity to seek and obtain such
protection. Members are free to meet this obligation through industrial design law or
through copyright law.
5. Patents
The TRIPS Agreement requires Member countries to make patents available for any
inventions, whether products or processes, in all fields of technology without
discrimination, subject to the normal tests of novelty, inventiveness and industrial
applicability. It is also required that patents be available and patent rights enjoyable
without discrimination as to the place of invention and whether products are imported
or locally produced.
There are three permissible exceptions to the basic rule on patentability. One is for
inventions contrary to ordre public or morality; this explicitly includes inventions
dangerous to human, animal or plant life or health or seriously prejudicial to the
environment. The use of this exception is subject to the condition that the commercial
exploitation of the invention must also be prevented and this prevention must be
necessary for the protection of ordre public or morality.
The second exception is that Members may exclude from patentability diagnostic,
therapeutic and surgical methods for the treatment of humans or animals.
The third is that Members may exclude plants and animals other than micro-
organisms and essentially biological processes for the production of plants or animals
other than non-biological and microbiological processes.
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6. Layout Designs of Integrated Circuits
Article 35 of the TRIPS Agreement requires Member countries to protect the layout-
designs of integrated circuits in accordance with the provisions of the IPIC Treaty (the
Treaty on Intellectual Property in Respect of Integrated Circuits), negotiated under the
auspices of WIPO in 1989. These provisions deal with, inter alia, the definitions of
“integrated circuit” and “layout-design (topography)”, requirements for protection,
exclusive rights, and limitations, as well as exploitation, registration and disclosure.
An “integrated circuit” means a product, in its final form or an intermediate form, in
which the elements, at least one of which is an active element, and some or all of the
interconnections are integrally formed in and/or on a piece of material and which is
intended to perform an electronic function.
7. Protection of Undisclosed Information
The TRIPS Agreement requires undisclosed information -- trade secrets or know-how
-- to benefit from protection. According to the Agreement, the protection must apply
to information that is secret, that has commercial value because it is secret and that
has been subject to reasonable steps to keep it secret. The Agreement does not require
undisclosed information to be treated as a form of property, but it does require that a
person lawfully in control of such information must have the possibility of preventing
it from being disclosed to, acquired by, or used by others without his or her consent in
a manner contrary to honest commercial practices.
The Agreement also contains provisions on undisclosed test data and other data whose
submission is required by governments as a condition of approving the marketing of
pharmaceutical or agricultural chemical products which use new chemical entities.
8. Control of anti-competitive practices in contractual licences
Article 40 of the TRIPS Agreement recognizes that some licensing practices or
conditions pertaining to intellectual property rights which restrain competition may
have adverse effects on trade and may impede the transfer and dissemination of
technology. Member countries may adopt, consistently with the other provisions of
the Agreement, appropriate measures to prevent or control practices in the licensing
of intellectual property rights which are abusive and anti-competitive. The Agreement
provides for a mechanism whereby a country seeking to take action against such
practices involving the companies of another Member country can enter into
consultations with that other Member and exchange publicly available non-
confidential information of relevance to the matter in question and of other
information available to that Member, subject to domestic law and to the conclusion
of mutually satisfactory agreements concerning the safeguarding of its confidentiality
by the requesting Member. Similarly, a country whose companies are subject to such
action in another Member can enter into consultations with that Member.
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IMPACT ON INDIA
According to the World Trade Organization, with effect from 1 January 1995, India became a
member of the World Trade Organization (WTO) and became a party to the TRIPS
Agreement. This was met with much debate and opposition, as it took the stance during the
negotiations that IPR protection was specifically within the purview of the World Intellectual
Property Organization and not the WTO. India argued during the negotiations that a country‟s
economic development should be taken into consideration when determining the extent of
patent protection required, and therefore was a leading advocate on behalf of developing
countries for the transition period approach as it relates to compliance with TRIPS.
The Indian pharmaceutical industry has faced several new challenges because of the TRIPS
Agreement. An amendment to the Patent Act, 1970 to introduce product patents changed the
institutional factors that had supported the industry‟s growth. It was assumed that the
amendment would have a negative impact on India and that it would hamper the growth of its
pharmaceutical industry because it would no longer be able to manufacture by reverse-
engineering or export drugs whose product patents were in effect.
In view of the TRIPS Agreement and impending changes to the Patent Act, 1970, the Indian
pharmaceutical industry is pursuing a new business strategy. While pharmaceutical
companies are increasing their investment in R&D, they have been participating in the
pharmaceutical GVC through international strategic alliances with global pharmaceutical
companies in the post-TRIPS period.
Until the mid-1990s, R&D in the Indian pharmaceutical industry focussed on R&D for the
development of new drug manufacturing processes. The TRIPS Agreement changed this. The
TRIPS Agreement has not only increased R&D expenditures in the Indian pharmaceutical
industry but also changed its R&D orientation. Indian pharmaceutical companies are
increasing their investment in R&D for product innovation. The pharmaceutical industry is a
highly R&D-oriented sector. Under the pro-patent regime of the TRIPS Agreement,
sustainable growth in the pharmaceutical sector depends on continuous R&D for the
development of new drugs and technologies.
Though Indian pharmaceutical companies have increased their R&D spending, most cannot
afford the R&D costs associated with developing and launching a product because they are
small relative to most global pharmaceutical companies and are operating at the lower end of
the value chain.
For all these financial and technological reasons, some Indian companies have adopted a
strategy of developing new molecules and licencing them out to large global pharmaceutical
companies in the early stage of clinical development.
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CRITICISM OF TRIPS
Since TRIPS came into force, it has been subject to criticism from developing countries,
academics, and non-governmental organizations. Though some of this criticism is against the
WTO generally, many advocates of trade liberalisation also regard TRIPS as poor policy.
TRIPS's wealth concentration effects (moving money from people in developing countries to
copyright and patent owners in developed countries), and its imposition of artificial scarcity
on the citizens of countries that would otherwise have had weaker intellectual property laws,
are common bases for such criticisms. Other criticism has focused on the failure of TRIPS to
accelerate investment and technology flows to low-income countries, a benefit advanced by
WTO members in the lead-up to the agreement's formation. Statements by the World Bank
indicate that TRIPS has not led to a demonstrable acceleration of investment to low-income
countries, though it may have done so for middle-income countries.
Daniele Archibugi and Andrea Filippetti have argued that the main motive for TRIPS was a
decline in the competitiveness of the technology industry in the United States, Japan, and the
European Union against emerging markets, which it largely failed to abate. They instead
argue that the main supporters and beneficiaries of trips were IP-intensive multinational
corporations in these countries, and that TRIPS enabled them to outsource key operations to
emerging markets.
The most visible conflict has been over AIDS drugs in Africa. Despite the role that patents
have played in maintaining higher drug costs for public health programs across Africa, this
controversy has not led to a revision of TRIPS. Instead, an interpretive statement, the Doha
Declaration, was issued in November 2001, which indicated that TRIPS should not prevent
states from dealing with public health crises and allowed for compulsory licenses. After
Doha, PhRMA, the United States and to a lesser extent other developed nations began
working to minimize the effect of the declaration. A 2003 agreement loosened the domestic
market requirement, and allows developing countries to export to other countries where there
is a national health problem as long as drugs exported are not part of a commercial or
industrial policy. Drugs exported under such a regime may be packaged or colored differently
in order to prevent them from prejudicing markets in the developed world.
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BIBLIOGRAPHY
The following sources have been referred to during the making of this submission:
1. National Library of Medicine
2. WTO Official Website
3. International Relations