The Journal of World Intellectual Property | Vol 8, No 1, January 2005 | Werner Publishing Co | Geneva | pp 53-65
The Road from TRIPS-Minus, to TRIPS, to TRIPS-Plus
Implications of IPRs for the Arab World
Mohammed EL-SAID*
I. INTRODUCTION
The advent of the World Trade Organization (WTO) in 1994 marked a new beginning in international trade and economic relations. The WTO’s main components, the General Agreement on Tariffs and Trade (GATT), the General Agreement on Trade in Services (GATS) and the Trade-Related Aspects of Intellectual Property Rights (TRIPS), represent today the main pillars of the “new global economic order”. The conclusion of the TRIPS Agreement came about as a result of the developed countries’ relentless efforts driven by their domestic interest groups to include the protection of intellectual property rights under the multilateral forum. [1] It is not surprising therefore that the TRIPS Agreement was regarded as the “most contentious and anomalous component of the Uruguay Round” of trade negotiations. [2] Almost a decade after the WTO creation, there continues to be a lack of agreement and controversy over the expected benefits of this Organization, including its TRIPS Agreement. [3] While proponents of the WTO have labelled it as “the greatest trade agreement in history”, [4] opponents view it as a mere “TRAP” to both the developed and developing countries. [5]
The TRIPS Agreement represents the most comprehensive agreement ever to be concluded in the field of IPRs. It contains provisions which lay down universal minimum standards for each protected branch of intellectual property rights including protection of copyrights, patents, trademarks, geographical indications, layout-designs, trade secrets and unfair competition.
The TRIPS Agreement is part of a “package” to which those countries seeking WTO membership have to adhere. Hence, countries seeking to join WTO have to accept and implement all obligations as required under TRIPS, GATS and GATT. [6] Hence this called for the incorporation, into domestic legislations, of the requirements of the TRIPS Agreement even before signing up to the Organization. To cope with the short-term costs and to enable Member States to prepare their accession to the WTO, transition periods were agreed upon and provided during the Uruguay Round of trade negotiations which was concluded in I994. [7] These periods correspond to each country’s level of development and economic prosperity. Accordingly, five- and ten-year transition periods were granted to developing and least-developed countries (LDCs) respectively, to bring their IPR protection into conformity with TRIPS standards while the developed countries were awarded one year to implement the TRIPS Agreement. [8]
However, in recent years, a new development in the international regulation of IPRs emerged: it represents the latest wave of shifting the discussion on issues related to IPR protection from the ambit of the multilateral framework to a more forceful one-to-one system. [9] This wave was clearly manifested by the growing tide of recent bilateral trade and investment agreements between developed and developing nations. [10]
This article sheds light on the evolution of free trade agreements (FTAs) and the IPR protection incorporated within such agreements. The emphasis will be on the latest free trade and investment agreements concluded between the United States and the European Union (EU) with the Arab world and their “TRIPS-Plus” nature. The article argues that FTAs are being used as political instruments to reward allies while, at the same time, enhancing the protection of intellectual property rights globally beyond the agreed levels of the TRIPS Agreement, hence resulting in a negative effect on both the developing and the Arab countries. This will circumvent and hinder the efforts of these countries to acquire the desired levels of technology and development.
II. THE TRIPS BARGAIN
The need to protect intellectual property rights on a global scale came mainly as a result of increased pressures from the governments of Western industrialized countries, steered by their giant enterprises and multinationals, which were arguing that counterfeiting and imitation in the developing world was costing them billions of dollars in losses every year. [11] This encouraged industrialized countries, particularly the United States and the European Union, to pursue a unilateral and a bilateral agenda to bring about the desired tougher levels of IPR protection at an international level despite the developing countries’ unwelcoming approach to such protection.
Developing countries, on the other hand, initially heavily opposed stronger IPR regulation under GATT and favoured the World Intellectual Property Organization’s (WIPO) role in the matter which was more sympathetic to their demands. However, eventually, and under intensive pressure and increased promises of concessions in other areas from developed countries (including increased market access for agriculture and textile as well as guarantees and assurances that developed countries will refrain from resorting to unilateral and bilateral pressures), developing countries accepted the adherence to a multilateral forum that incorporated globally higher minimum levels of IPR protection. [12]
Accordingly, developing countries believed that the conclusion of the TRIPS Agreement would represent the end of the road and the last multilateral effort to regulate internationally the issue of IPRs. By removing the “burden” of intellectual property rights out of their way in exchange for several concessions in other vital sectors, developing countries hoped that they would succeed in preventing developed countries, especially the United States, from pursuing their unilateral and bilateral practices against them. Such a belief was reinforced by the developed countries’ own determination to shift the discussions surrounding IPRs to a more efficient and cohesive multilateral forum rather than depending on the already existing soft and fragile WlPO. [13]
From the point of view of the developed countries, however, the WTO’s TRIPS Agreement was no more than just the beginning of a more heavily regulated global market for intellectual property rights. [14] Thus, it appeared that TRIPS aimed at universalizing the IPR protection according to Western intellectual property rights levels and standards as a first step towards further and wider protection. [15] In this context, the subsequent collapse of the WTO Ministerial Conferences in Seattle and Cancun came mainly as a result of the developing countries’ frustration and scepticism about developed countries’ readiness to fulfil their earlier promises undertaken during the Uruguay Round of Negotiations and their resolve to unilateralism and bilateralism instead. [16]
III. INTELLECTUAL PROPERTY RIGHTS IN THE ARAB WORLD
Generally, the Arab countries (as part of the developing countries) viewed IPR protection negatively. Emanating from a clear lack of awareness and a weak comparative advantage, Arab States awarded little attention to IPR protection and regulation. Thus, Arab States in their own mindset always followed a passive approach of only acting on the protection of IPRs “whenever they have to”. [17]
This is not to say that IPR protection did not exist or was a new issue in the Arab region prior to 1994. In fact most Arab countries have had IPR laws and legislations for decades; the problem has often been the evident lack of implementation and enforcement of these rights. [18]
However, in recent years, a large number of Arab countries have acceded to the WTO, while others are on the way to doing so. As a prerequisite to such accession, these countries had to undertake sonic major legislative changes in their IPR regime which resulted in upgrading their IPR laws to the international minimum levels of protection as required under the TRIPS Agreement. In other words, some Arab States have moved from a TRIPS-Minus situation, where the application and enforcement of intellectual property rights was weak, to a TRIPS situation, where stronger universal minimum levels of IPR protection were required with very little preparation and national debate. [19]
IV. BILATERALISM AND THE ARAB COUNTRIES
The collapse of the 1999 WTO Ministerial Conference in Seattle signalled the official beginning of more difficult times ahead for the global multilateral system as embedded under the WTO structure. However, the subsequent abrupt failure of the Cancun Ministerial Conference in 2003 led many to believe that the future of the world multilateral framework co-operation is in real jeopardy. However, what is interesting to note in this regard is the fact that even before the latest stalemate in discussions under the multilateral framework occurred, developed countries have already undertaken several measures that undermined the proper functioning of the world multilateral regime.
Although developed countries, and in particular the United States, made promises that they would not resort to unilateral or bilateral measures if a multilateral trading system was established during the Uruguay Round of Negotiations in 1994, empirical evidence refutes these arguments. One example is found in the increase in recent years in the number of bilateral trade and investment initiatives and agreements sought by the United States, and the European Union, to strengthen their trade relations with other developing countries. The world has experienced a tremendous rise in the number of bilateral free trade agreements in recent times, not only between developed countries but also between them and LDCs. The United States has already completed eight bilateral free trade deals, and is currently negotiating another fourteen agreenients. [20]
Such agreements deal with various issues of trade, tariff reduction, market access, services, labour and environment. However, what is of relevance here are the detailed chapters incorporated within these agreements that emphasise the importance of protecting IPRs in accordance with the “highest international standards” and levels of protection. Such standards are achieved through a number of bilateral free trade and investment agreements.
Arab countries did not escape the recent wave of bilateralism. In fact, in less than half a decade, the United States has signed FTAs with three Arab countries. These are the U.S.-Jordan FTA, [21] the U.S.-Morocco FTA, [22] and finally the U.S.-Bahrain FTA. [23]
Other developed nations are also following suit. The European Union has recently completed more than thirty bilateral association agreements with countries located in the Middle East and North Africa (MENA) (including Jordan, Syria. Egypt, and the Palestinian Authority), and Eastern Europe, [24] while Japan has also concluded a number of FTAs during the last year. [25]
What is interesting about these FTAs and association agreements is the effect they are having upon their weaker Member States (in such cases Arab and developing countries). Such agreements have resulted in what sometimes is referred to as TRIPS-Plus effect. However, it is important to pay close attention to the meaning and implications of such a development as far as Arab countries are concerned.
V. THE DEFINITION OF “TRIPS-PLUS”
The WTO’s TRIPS Agreement laid down minimum international standards for IPR protection. Although Members cannot derogate or provide lower ceilings of protection, [26] they still have the right to apply and incorporate higher amid more extensive levels of protection if they deemed so wittingly, as long as they apply the general principles of most-favoured nation (MFN) and national treatment under this Agreement. In addition, the TRIPS Agreement also provides Member countries with the discretion to incorporate their own standards and procedures about how to implement the Agreement within their jurisdictions.
However, if a country is being forcefully required to implement more extensive levels and standards of IPR protection than that required under time TRIPS Agreement, or undertakes the elimination of an option which was awarded to it under the Agreement, it may then be said that this country is implementing a TRIPS-Plus recipe. [27] Additionally, a TRIPS-Plus mechanism may also mean that countries are to interpret the TRIPS Agreement in a narrower sense thus ensuring the compliance of these countries in accordance with this Agreement with the utmost levels of efficiency.
However, during the past few years, it has been noticed that a number of countries have adapted and incorporated more enhanced levels of IPR protection unwillingly as a result of pressures exerted on them by the industrialized countries, either under the WTO or under some bilateral free trade agreements. The latter trend was championed by the United States and the European Union in their latest free trade and association agreements. In this context, an important question is often raised: what are the components of a TRIPS-Plus recipe under bilateral trade and investment agreements in relation to these agreements signed with the Arab World recently?
VI. THE GENESIS OF “TRIPS-PLUS”
Generally speaking, there can be no fixed definition for the term “TRIPS-Plus”. In fact, such a term is still in the process of evolution and has proven to be case- and country-specific. This can be viewed in conjunction with the emerging provisions of the recent FTAs in this field in which they all seem to add more to the existing literature. Following are some examples of the characteristics which may deem an agreement a TRIPS-Plus that characterizes bilateral trade agreements that have been signed between the United States and the European Union, on the one hand: and some Arab countries, on the other.
First, the TRIPS Agreement allows Member countries to exempt and exclude plant and animal patents from their national patent laws. [28] Increasingly, countries are being forced through such FTAs to relinquish such a right by requiring them to award protection for such patents hence resulting in a TRIPS-Plus effect. A good demonstration of this trend is the U.S.-Jordan ETA which commits Jordan to provide protection for such patents, [29] although this was not a condition attached to Jordan’s membership in the WTO. Such a provision was also echoed in the U.S.-Bahrain FTA and U.S.-Morocco FTA. [30]
Moreover, on the issue of revocation of patents, the TRIPS Agreement grants Member countries the discretion to incorporate the wounds of such revocation within their national legislations. [31] However, some FTAs are increasingly restricting the basis of such revocation to include cases of fraud and misrepresentation which represents further commitments beyond the TRIPS Agreement. [32]
Second, a TRIPS-Plus effect may relate to extending certain periods of protection beyond the requirements of the TRIPS Agreement and forgoing certain benefits related to the enjoyment of transition periods by certain countries. An example of the earlier scenario is clearly manifested by the U.S.-Morocco FTA which provides that protection for copyrights should be calculated on the basis of the life of the author plus seventy years, [33] a clear extension of the WTO’s TRIPS Agreement, which proposed that protection should be the life of the author plus fifty years. [34]
In addition, the TRIPS Agreement provided a minimum ten-year period of protection for industrial designs. [35] Under most FTAs, this period has been extended to at least fifteen years, therefore resulting in a TRIPS-Plus effect. [36]
TRIPS-Plus effects can also be evident as a result of the pressure exerted on developing countries to forgo privileges related to the transition periods under the WTO, which is clearly manifested in several FTA and association agreements. For example, under the EU-Jordan Association Agreement, Jordan was pressured to implement shorter periods of transition than that provided under TRIPS regarding the protection of patents. [37]
Third, a TRIPS-Plus arrangement may oblige countries to join a specific international agreement or treaty related to a specific field of intellectual property rights. Such an effect was present in the requirement of the U.S.-Jordan FTA and EU-Jordan Partnership Agreement. Both of these agreements require Jordan’s submission to a number of international agreements and treaties such as the WIP0’s Internet Treaties. [38] Moreover, Jordan was also expected to submit to the International Convention for the Protection of New Varieties of Plants (UPOV Convention) and the Joint Recommendation Concerning Provisions on the Protection of Well-Known Marks of l999. [39] Similar provisions can also be found in several other FTAs signed with other Arab countries as well, hence also rendering them of TRIPS-Plus nature. [40]
Fourth, the TRIPS Agreement’s strength lies in its extensive provisions related to enforcement. Accordingly, any bilateral agreement that modifies and adds to such measures will most likely result in a TRIPS-Plus effect. A clear model of this is the U.S.-Jordan FTA that obligates Jordan to raise its criminal penalties to Jordanian Dinar 6,000 [41] for copyrights and trademark counterfeiting and piracy. [42] The U.S.-Jordan FTA also provides that, in the event of copyright piracy and trademark counterfeiting, authorities may initiate criminal actions and border measures without the need for formal complaint. [43]
Fifth, on the issue of trademark protection, the TRIPS Agreement adopts a broad definition of what constitutes a “trademark”, and provides several examples of what may constitute a trademark. [44] Increasingly, subsequent FTAs are incorporating other emerging types of signs for registration including visual, scent amid sound marks thus resulting in further higher levels of protection. [45]
Additionally, the TRIPS Agreement contains a separate part of provisions dealing with the issue of geographical indications. Currently, several FTAs are obliging Member States to treat geographical indications as trademarks for the purposes of protection, registration and implementation. [46] Such treatment is most likely to result in additional protection for famous geographical marks belonging to the developed countries rather than the developing ones.
Moreover, protection for famous amid well-known trademarks is also being strengthened under such FTAs by extending that protection to include not only similar goods but also dissimilar goods as identified by the famous or well-known trademarks. [47]
Sixth, the requirement of several FTAs and bilateral investment agreements for countries to adhere and implement “the highest international standards” of protection for intellectual property rights also makes such agreements subject to the TRIPS-Plus criteria. Although such standards are not defined precisely under these agreements, some suggest that such standards are being included to pave the way for the subsequent conclusion of a multilateral or bilateral investment treaty. Therefore, the effect of such provisions may not be felt initially, but is most likely to be felt subsequently in relation to variant issues including investment and attracting foreign direct investment (FDI). [48]
Seventh, the imposition of alternative dispute settlement procedures under such FTAs other than that of the WTO is also considered as a TRIP-Plus clause. In a number of FTAs, new dispute settlement procedures are being proposed [49] to solve disputes arising from the implementation and interpretation of such agreements. [50] Such agreements are often based upon a binding arbitration mechanism. By bypassing the WTO dispute settlement, such FTAs are increasingly weakening the multilateral dispute settlement framework and squeezing weaker States to adhere to more sophisticated dispute settlement procedures (in which they have neither the resources nor the expertise to compete). This leaves the developing countries, including Arab States, with less and more restricted options regarding the implementation of such agreements.
VII. TRIPS, ARAB STATES AND THE FUTURE OF THE WORLD MULTILATERAL INTELLECTUAL PROPERTY REGIME
Immediately after the collapse of Cancun Trade talks in 2003, Robert Zoellick, the U.S. Trade Representative, declared that the United States would not be deterred from pursuing its unilateral amid bilateral trade agenda. In fact, he went further to divide countries into “can do” and “won’t do” FTAs with the United States. [51] Such a development should not be seen as the beginning, rather a continuation of the United States approach of bringing around its desired modifications and changes to the world multilateral trading agenda, including the IPR protection through its unilateral and bilateral initiatives.
Such a process is not unprecedented in the history of IPR protection. It follows a pattern of a number of policies representing a “regime” and “forum shift” [52] to force the necessary changes to the multilateral framework through a policy of coercion and enforcement rather than consensus building and democratic bargaining. [53] Indeed, today’s bilateralism represents the third wave of such a process that builds upon the first and second waves starting with shifting the discussion on intellectual property rights from the ambit of the international conventions (Paris and Berne) to WIPO, and subsequently from WIPO to the umbrella of GATT and the WTO.
It could be argued that the world is experiencing, under the current wave of bilateralism, a policy of “competitive liberalization” advocated by the United States and the European Union. However, such a policy is undermining the world multilateral framework. The discriminatory nature of such agreements, coupled with the policy of rewarding allies for their political and international support [54] rather than their trade credentials is indeed creating more complexities for the world multilateral framework. [55]
The recent success of developing countries in blocking the adaptation of any further commitments under the WTO through their collective united stand and coalition against such matters led the United States to believe that any changes it needs to bring to the multilateral agenda can be achieved first through bilateralism and trade sanctions.
Targeting “soft countries” is also aiding the United States and the European Union in creating their global vision of a more regulated intellectual property rights universe. Thus, it may be realized that these countries are indulging in the process of modifying and amending issues which they deem necessary to change under the multilateral framework through bilateral means. In addition, since most bilateral agreements require their Member States accession to a number of international intellectual property agreements, the developed States are fostering the process of “maturity” for these agreements thus bringing them into force ahead of their time. [56]
It is also important to draw attention to the flexible nature of each subsequent bilateral PTA between developed countries and a new LDC. They take a cumulative country-specific approach, adding more features on top of current FTAs. The upshot is what some referred to as “state-of-the-art” FTAs, particularly with regard to IPR protection. [57] Each agreement is being used ex ante as a standard model of negotiations with new countries, leading to a more enhanced TRIPS-Plus recipe. [58]
Although the creation of the TRIPS-Plus effect may be attributed to the pressure exerted by the developed countries, particularly the United States and the European Union, upon weaker developing countries through bilateralism, the deficient nature of the TRIPS Agreement itself also contributed and facilitated this process. In this regard, the TRIPS Agreement incorporates a number of vague, ambiguous and unpredictable provisions which may allow countries to deviate and interpret the agreement differently. [59]
Such bilateral agreements arc also acting as an impediment to Arab regional cooperation and development. Any Arab State signing a bilateral agreement with a developed country will not only be susceptible to harsher requirements of protection, but will also force other neighbouring Arab States to adhere to even harsher provisions in order to be able to compete in attracting foreign direct investment. A clear example of this was the latest quarrel between the Arab Gulf Cooperation Council (AGCC) and Bahrain (which is a member of the AGCC) as a result of Bahrain’s signing of an FTA Agreement with the United States. In fact, the AGCC urged Bahrain to denounce amid drop its FTA with the United States because of its negative effect on the future cooperation and development of the AGCC. [60]
To sum up, one can depict the creation of a systematic web of bilateral free trade agreements over which the developing countries will have no control. Industrialized countries are using different instruments to complete such agreements with LDCs, including the threat of trade sanctions and suspension of aid and FDI. Penetrating regional alliances is an important part of this policy. The United States now have in force at least one FTA or BIT in each region and continent, representing alliances with certain “soft” or “friendly” regimes that allows it to access such markets as well as facilitating its mission in creating a future multilateral investment treaty based on the previous failed Multilateral Investment Treaty model (MAI). Hence, one can anticipate that the real dangers of such a web of treaties are yet to be fully recognised in the near future after the completion of the current bilateral negotiations wave led by the United States and the European Union.
VIII. CONCLUSION
Jordan, Bahrain and Morocco represent an interesting case study for the protection of intellectual property rights in the world. These countries do so because in less than a decade, they have moved from a TRIPS-Minus situation to a TRIPS-Plus one with little preparation and at immense speed. Whilst some argue that the one-hundred years period which preceded the establishment of the WTO was not enough for the developing countries to adjust and upgrade their IPR regimes accordingly, [61] the speed at which these three Arab countries reformed and upgraded their IPR regime provides a very unique situation for developing countries that have a weak comparative advantage and very limited intellectual property rights assets and resources to protect.
Several developments are affecting the evolution of the TRIPS Agreement in the global arena in a direction that is only adding more constraints and protection to IPRs in developing countries, including the Arab countries. Recent bilateral trade initiatives are increasingly rendering the TRIPS Agreement “ineffective” in the face of such initiatives.
The policy of “competitive liberalization” as advocated by the United States and the European Union is undermining the world multilateral framework. The discriminatory nature of such agreements, coupled with the policy of rewarding allies for their political and international support, [62] rather than their trade credentials is indeed creating more complexities for the world multilateral framework. One must not look at the latest FTAs with Arab States as a separate development from international relations, but rather as a part of an organised global policy network-building exercised by the developed countries.
Such bilateral arrangements represent the third wave of shifting debate about IPRs from the WTO auspices to a mere State-to-State arrangement. Bypassing the WTO Dispute Settlement Procedure and the operation of such trade deals outside the ambit of the WTO should be considered as a major threat to the world multilateral trading regime under the WTO. [63]
The push by the developed countries including the United States and the European Union to incorporate the TRIPS Agreement ahead of time and to further add more obligations which go beyond the TRIPS Agreement, upon the shoulders of Arab countries, should not be underestimated. This will result in restraining the ability of Arab countries to implement the TRIPS Agreement freely and will circumvent their negotiation power multilaterally. [64]
Arab countries must play a more active role in the international arena by uniting their efforts under the multilateral framework. This can be achieved by joining forces with like-minded countries. Moreover, Arab States must also adopt a comprehensive policy towards creating a national economy capable of fostering creativity and innovation aiming to compete globally. In this regard, the 2002 Arab Human Development Report, [65] published by the United Nations, stresses the need for establishing incentives to support greater creativity and innovation in the Arab world via enhancing the IPR protection. However, for Arab countries to reap the benefits of such protection, they need to develop a national and regional agenda that pays precise attention and care to their development needs and priorities. Arab States can ignore such recommendations, but only at their peril.
* Research Fellow. Faculty of Law, University of Manchester, UK. The author may be contacted at: melsaid@hotmail.com.