Thailand has little to gain in trade pact with US

Bangkok Post, 29 April 2005

COMMENT / FTA AGREEMENTS

Thailand has little to gain in trade pact with US

The FTA with the US would tighten the intellectual property rights regime even further, offering no perceptible benefit to Thailand

By JADE DONAVANIK

Long before the advent of the World Trade Organisation there was the General Agreement on Tariffs and Trade, set up in 1947. The GATT evolved into the WTO following the Marrakesh Agreement adopted at the end of the Uruguay Round, the eighth round of GATT negotiations held between 1986 and 1994. The main provisions of GATT were retained together with two ground rules : the most favoured nation and national treatment rules.

The most favoured nation rule requires that if one WTO signatory grants another country ’’more favourable treatment’’ _ eg, a reduction in the customs duty payable on imports of a particular product _ it must immediately and unconditionally provide the same treatment to all WTO signatories.

This non-discriminatory obligation applies to customs duties and charges of any kind connected with imports/exports, as well as to internal taxes and charges, and to all the rules by which such duties, taxes and charges are applied.

But as with all such things, there are exceptions _ in this case allowing members of customs unions and free trade areas to give more favourable treatment to imports from one another as embodied in article XXIV of GATT 1994. This meant that when big countries such as the United States saw multilateral negotiations under the WTO as an obstacle to their trading power, they set out to form free trade areas to serve bilateral interests.

For some reason, Thailand is an enthusiastic advocate of these FTAs, and already has entered into several of them. It is currently engaged in talks for an FTA with the US. Three rounds of negotiations have been held.

Article XXIV requires that members of the WTO wishing to enter into an FTA must remove duties and other restrictions affecting _ substantially all _ the trade between the two partners If an FTA is entered into by countries of roughly equal size, economy and negotiating power, it should enhance the economic development of both. But this is not the case in relation to Thailand and the US.

The Thai-US FTA gives the impression that there can be no win-win outcome. One country has much to gain and the other much to lose, particularly in sectors such as intellectual property management. Some may argue that Thailand will benefit from signing an FTA with a country such as the US, but who exactly benefits ? Most Thais or a few select people ?

Regarding the protection of intellectual property rights, it is clear that the US is pushing for adherence to TRIPs-Plus, the standard higher than under the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPs) within the WTO framework.

This was given weight in a statement made by a US intellectual property expert during talks between US FTA negotiators and Thai academics, including this author, on the eve of intellectual property negotiations in Pattaya on April 5 during the third round of Thai-US FTA negotiations.

Are we ready for such standardisation ?

A very basic argument for intellectual property rights protection is the stimulation and support it gives to the creation of useful arts, novel inventions, artistic works and other innovations. Copyrights and the protection of industrial property such as patents and trademarks are effective tools in serving this aim.

For a country such as Thailand, the concept of intellectual property rights is foreign to the sharing of knowledge rooted in education and society as a whole and proof is needed that they really work. The modern intellectual property rights regime is new to Thailand, and much current protection under Thai law is more than enough at our experimental stage. Why should we adopt a higher standard when the lower level still does not promise to benefit Thai creators, inventors and users ?

The copyright term of 50 years from the date of creation or publication, or the lifetime of the author plus 50 years is socially and economically adequate for Thailand. But the US is now seeking an increase in both cases to 70 years, claiming that Thais will benefit further. How can this be when we are not the main creators of copyrighted works, especially in higher technology areas ?

Patent protection currently includes eligibility for micro-organisms and their components that do not occur naturally, and the Plant Variety Protection Act to protect the work of plant breeders, be they natural or juristic persons. This already forces struggling Thai breeders and scientists into innovations or more advanced areas not yet protected by patents.

Washington wants to expand patent protection to plants and animals. Almost all entities possessing the capability to come up with novel and inventive kinds of plants or animals, especially using genetic modification techniques, are multinational corporations. Ask not where they come from ; ask what they want of Thailand.

’’Please allow us to have our own means of development,’’ was this author’s last comment to US representatives on April 4 in Pattaya.

When the US was earlier engaged in intellectual property developments, it was not hindered by comment, requests, pressure and agreements. The TRIPs Agreement is already a heavy burden on Thailand, but we are very close if not already in compliance. The substantive and even procedural parts of Thai intellectual property laws are sufficient : the problem lies with enforcement.

The enforcement of intellectual property rights in Thailand needs major improvement. Of course, adequate protection for intellectual property rights will enhance a country’s economic competitiveness. But being too protective devalues progress.

The US should reconsider its intellectual property rights regime, especially the patents system. That regime tends towards absurdity. Ask pharmaceutical companies Eli Lilly, Pfizer and Wyeth, which declared in the New York Times of April 19 that the world of research and development would be more progressive if the patent regime were relaxed.

Jade Donavanik is an expert in intellectual property rights with Manothai-Jade and Associates Law Office

source: Bangkok Post