Leaked Text Incorporates Stringent TRIPS Plus Elements, Global Calls for Rejection Increase

Recently, some renowned experts including professors Joseph Stiglitz and Srinath Reddy wrote to Indian Prime Minister Narendra Modi regarding the leaked draft text on the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Waiver proposal.

Urging the PM to not agree to the text, the letter says that “A consensus has emerged that the text will not provide the freedom to operate Global South manufacturers require. It also adds burdensome new limits relative to the WTO status quo”. A similar appeal was made earlier to the South African President Cyril Ramaphosa.

However, there has been no response on the issue from the governments of both India and South Africa. The draft text purportedly emerged from informal discussions among the US trade representative (USTR), the European Union (EU), South Africa, and India led by the WTO Secretariat.

In October 2020, India and South Africa had led from the front table the TRIPS waiver proposal which demanded waiver for products and technologies including diagnostics, therapeutics, and vaccines from the obligation on copyrights and related rights, industrial designs, patents, and the protection of undisclosed information in relation to the prevention, containment, or treatment of COVID-19. 

This step, right at the start of the pandemic, was hailed especially by the less developed countries which have continued to suffer due to inequality in access to COVID-19 products and technologies including diagnostics, therapeutics, and vaccines. The proposal is now co-sponsored by more than 60 developing countries but the negotiations on it are still floundering at the World Trade Organisation (WTO). In Africa, till date, only 15% of the population has been fully vaccinated. The leaked text defeats the purpose of the original TRIPS waiver proposal and is a huge compromise on the stand that India and South Africa had taken.   

Meanwhile, several voices have emerged against the leaked text from various corners. Activists, experts and a few politicians from across the globe have been united in their opposition to the leaked draft text. It has been termed as a “compromise outcome” which is worse than the status quo. 

Contentious Provisions of the Leaked Text – Some Go Beyond TRIPS

Some of the obvious contentious provisions of the leaked text are:

One, it only covers vaccines and excludes lifesaving therapeutics and diagnostics for testing COVID-19. 

Two, an ‘eligible member’ is defined as any developing country member that exported less than 10% of world exports of COVID-19 vaccine doses in 2021. This automatically excludes countries such as China whose share in total exports of COVID-19 vaccines is about 34%. 

However, a closer reading of the text reveals that many of the provisions in this text have been made even more stringent than the TRIPS agreement. Many of these, in fact, are in the nature of TRIPS plus provisions – entailing additional conditions to use the compulsory or government-use license than those prescribed under the WTO's TRIPS regime – which end up providing a higher level of intellectual property (IP) protection to patent holders.

The TRIPS Agreement is part of the Agreement establishing WTO, which prescribes the minimum standards of protection and enforcement of IP. It allows Members to provide more extensive protection of intellectual property if they so wish. This provides a route for the entry of TRIPS plus provisions, which aim at increasing the level of protection to IP right holders beyond TRIPS and are extensively used by developed countries and multinational corporations.  

The leaked text proposes conditions that go beyond the TRIPS Agreement for the use of compulsory license in the context of COVID 19 vaccines. Organisations such as Médecins Sans Frontières, and many others experts and activists have undertaken a thorough analysis of the leaked text and concluded that it is a bad deal which needs to be rejected.

What are the TRIPS Plus elements in the Draft Text?

1. Paragraph 3 (a) of the leaked text stipulates that “The authorization shall list all patents covered”. This is a restrictive condition and is a TRIPS Plus provision. Article 31 of the TRIPS agreement pertains to compulsory licensing and government-use authorisation. Clause 31 (a) mentions that “authorization of such use shall be considered on its individual merits” and there is no restriction as to how a WTO member may draft a compulsory license. 

The text, however, puts an extra condition of listing all patents. This is a difficult condition especially in the times of a pandemic where listing all patents may not be possible and may take indefinite time. 

2. Paragraph 3 (d) of the leaked text stipulates that “Eligible Members shall undertake all reasonable efforts to prevent the re-exportation of the COVID-19 vaccine that has been imported into their territories”. 

It must be noted that under the TRIPS agreement, there is a flexibility to allow parallel importation. Under parallel importation products are marketed by the patent owner or with the patent owner’s permission in one country and imported into another country without the approval of the patent owner. This is a legitimate policy option that has been made use of by some countries to obtain patented health technologies at a reduced price. 

However, the leaked text puts restrictions on such parallel imports. And that too in the times of a pandemic where a large section of the population in the poorer countries has still not been vaccinated. This is yet another example of a TRIPS provision. Under TRIPS agreement the restriction on re-exportation applies only in the case of compulsory license exclusively for exports under Article 31 bis. The proposal in the text expands that restrictions to all types of compulsory license.

3. Paragraph 4 of the leaked text stipulates that nothing in Article 39.3 shall prevent a member from taking necessary measures to enable the effectiveness of any authorisation issued. 

Article 39.3 of the TRIPS agreement pertains to undisclosed test or other data, which are under the realm of trade secrets. It states that Members shall protect such data, as contained in the dossiers submitted to the regulatory agencies, against disclosure, except where necessary to protect the public, or unless steps are taken to ensure that the data are protected against unfair commercial use. Thus, under certain circumstances disclosure of information may take place. 

But the language in the leaked text restricts the disclosure only in the context of compulsory license. This means such a trade secret cannot be disclosed in the absence of a compulsory license. Moreover, it overrules any such exceptions as “to protect public” or if it is ensured “that the data are protected from unfair commercial use”. All these come under the ambit of TRIPS Plus provision. 

4. Paragraph 5 of the leaked text stipulates more reporting restrictions (in the footnote) such as quantities for which authorisation has been granted, countries to which product is to be supplied as soon as possible. This again is a TRIPS Plus provision as it is very difficult to specify the exact quantity which will be supplied to a particular country. This is especially so in the times of a pandemic such as the COVID-19 where the situation is dynamic and may change rapidly and unexpectedly.    

Although on completing more than a year at the helm of WTO as DG, Okonjo-Iweala had proclaimed equitable and affordable access to vaccines, therapeutics and diagnostics to be the top priority, she hailed the leaked text as a breakthrough. The WTO DG stated that “This is a major step forward and this compromise is the result of many long and difficult hours of negotiations…”, though pointing out that not all the details of the compromise have been ironed out. 

In contrast, K M Gopakumar, legal advisor and senior researcher with the Third World Network, says that India should distance itself from this text. According to him “The proposals in the leaked text fully evade the rationale behind the waiver proposal, that is, to overcome the IP barriers for the diversification of the production of COVID-19 medical products by creating more policy space that goes beyond the existing flexibilities in the TRIPS agreement. What is offered is a limited solution with onerous conditions that go beyond the requirements of the TRIPS Agreement”. 

While both Indian and South African governments continue to maintain an eerie silence over the issue, there is a rising demand by activists and experts from across the globe to reject the leaked text. As the next round of TRIPS council is likely to be held in June, things still remain uncertain regarding the fate of the original TRIPS waiver proposal. But if the protagonists - India and South Africa - dither then the hope for a favourable outcome for the poor countries would fade.