Extension Of The Transition Period For LDCs: Flexibility To Create A Viable Technological Base Or Simply (a Little) More Time?

by SOUTH CENTRE & CIEL

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INTELLECTUAL PROPERTY QUARTERLY UPDATE (Q1 - 2006)

Introduction

On November 29, 2005, the Council for Trade-related Aspects of Intellectual Property Rights (Council for TRIPS) granted Least Developed Country Members (LDCs) an extension of their transition period to comply with the TRIPS Agreement. Article 66.1 of the TRIPS Agreement established that LDCs were not required to apply the provisions of the TRIPS Agreement – other than the most favored nation and national treatment disciplines – for a period of 10 years from its entry into force, in view of their special needs and requirements, financial and administrative constraints, and need for flexibility to create a viable technological base. Article 66.1 also provided that extensions to this period should be accorded upon duly motivated requests.

The Council for TRIPS’ response to such a request in 2005 was portrayed as proof of the commitment of the Members of the World Trade Organization (WTO) to giving the world’s poorest countries “the flexibility that they need in order to meeting their WTO obligations in a way that servers their development needs.”1 Most LDCs, however, have expressed their dissatisfaction with the decision, including the brevity of the extension – seven and half years.2 In addition, LDCs have denounced the imposition of certain conditions that in fact reduce the flexibility they need to design and implement domestic intellectual property protection to effectively promote the development, access, and dissemination of relevant knowledge, products, and technology.

The present note will provide a brief overview and analysis of the Council for TRIPS’ November 2005 Decision, focusing on whether it does indeed provide an adequate framework and period of time for LDCs to ensure that the eventual compliance with the TRIPS Agreement is conducive to their national social and economic welfare. After this Introduction, Section II will provide a background to the purpose and importance of transition periods in the context of the TRIPS Agreement. Section III will then address the November 2005 Decision to extend the transition period under Article 66.1, particularly its provisions on technical cooperation and its limitations on the changes LDCs can formulate in their intellectual property laws, and consider the implications for their policies on innovation, technology transfer, and other areas of sustainable development. Finally, Section IV will provide some concluding thoughts.