The TRIPS Agreement: background, salient features, WTO dispute settlement and Indian IP law

1. Background

• Through the 1970s and 1980s, the United States, the European Communities and Japan complained that counterfeiting and weak patent laws in developing countries cost their industries heavily, and that WIPO treaties could not be enforced.
• The Uruguay Round of GATT negotiations, launched at Punta del Este in 1986, included “trade-related aspects of intellectual property rights” on their insistence. India and Brazil led the opposition, arguing that IP was not a trade matter and belonged in WIPO.
• The Agreement on Trade-Related Aspects of Intellectual Property Rights was signed at Marrakesh on 15 April 1994 as Annex 1C to the Agreement establishing the World Trade Organization, and came into force on 1 January 1995. It binds every WTO member; it cannot be accepted separately.

2. Salient features

Basic principles (Part I).

• Minimum standards (Article 1): members must give at least the protection TRIPS requires and may give more, but are free to choose the method of implementation.
• Paris-plus and Berne-plus (Articles 2 and 9): members must comply with the substantive Articles of the Paris Convention (Articles 1 to 12 and 19) and of the Berne Convention (Articles 1 to 21, except the moral rights in Article 6bis).
• National treatment (Article 3) and most-favoured-nation treatment (Article 4).
• Exhaustion (Article 6) is left to each member, so parallel imports can be allowed.
• Objectives and principles (Articles 7 and 8): IP should promote innovation and the transfer of technology to the mutual advantage of producers and users, in a manner conducive to social and economic welfare; members may adopt measures to protect public health and nutrition and to prevent abuse of IP rights.

Standards for each right (Part II).

• Copyright (Articles 9 to 14): protection extends to expressions, not ideas; computer programs protected as literary works and compilations of data; rental rights; term at least fifty years; performers and producers of phonograms fifty years, broadcasts twenty years.
• Trade marks (Articles 15 to 21): any sign capable of distinguishing goods or services; service marks; protection of well-known marks; term at least seven years, renewable indefinitely; compulsory licensing of marks not allowed.
• Geographical indications (Articles 22 to 24): general protection against misleading use, and additional protection for wines and spirits.
• Industrial designs (Articles 25 and 26): new or original designs, at least ten years.
• Patents (Articles 27 to 34): patents for any invention, product or process, in all fields of technology, that is new, involves an inventive step and is capable of industrial application, without discrimination as to field (Article 27.1); permitted exclusions for ordre public, for diagnostic, therapeutic and surgical methods, and for plants and animals, but plant varieties must be protected by patents or an effective sui generis system (Article 27.3(b)); rights of the patentee (Article 28); limited exceptions (Article 30); use without authorisation, i.e. compulsory licences, on conditions (Article 31); term of twenty years from filing (Article 33); reversal of burden of proof for process patents (Article 34).
• Layout-designs of integrated circuits (Articles 35 to 38): ten years.
• Undisclosed information (Article 39): trade secrets and test data submitted for marketing approval.
• Anti-competitive practices in licences (Article 40).

Enforcement (Part III, Articles 41 to 61). Fair and equitable procedures, civil remedies (injunctions, damages), provisional measures, border measures against counterfeit and pirated goods, and criminal procedures at least for wilful trade mark counterfeiting and copyright piracy on a commercial scale.

Dispute settlement and institutions (Parts V to VII). Disputes go to the WTO Dispute Settlement Understanding (Article 64). A Council for TRIPS monitors compliance (Article 68). Transitional periods (Articles 65 and 66) gave developing countries until 2000 and, for product patents in fields not previously protected, until 2005; least-developed countries have extended periods.

3. Flexibilities and public health

Compulsory licences, parallel imports, the freedom to define patentability criteria and the exceptions under Article 30 are the main flexibilities. The Doha Declaration on the TRIPS Agreement and Public Health, 14 November 2001, confirmed that TRIPS “does not and should not prevent members from taking measures to protect public health”, that each member may grant compulsory licences and decide the grounds, and that each may determine what is a national emergency. Its paragraph 6 led to a 2003 waiver and to Article 31bis, in force from 23 January 2017, allowing compulsory licences to produce medicines for export to countries without manufacturing capacity. India’s section 92A of the Patents Act implements this.

4. TRIPS and Indian IPR

India had a strong process-only patent regime for food, medicines and chemicals under the Patents Act, 1970, which built its generic drug industry. To comply with TRIPS it amended or enacted:

• the Patents (Amendment) Act, 1999 (with effect from 1995), creating the “mailbox” for pharmaceutical and agrochemical product applications and exclusive marketing rights, after the WTO Appellate Body ruled against India in the dispute brought by the United States in 1997 (India – Patent Protection for Pharmaceutical and Agricultural Chemical Products);
• the Patents (Amendment) Act, 2002 (twenty-year term, reversal of burden, new definitions) and the Patents (Amendment) Act, 2005 (product patents in all fields from 1 January 2005, with the safeguards of section 3(d), pre-grant opposition and compulsory licences);
• the Copyright (Amendment) Acts of 1994 and 1999, the Trade Marks Act, 1999, the Geographical Indications of Goods (Registration and Protection) Act, 1999, the Designs Act, 2000, the Semiconductor Integrated Circuits Layout-Design Act, 2000, and the Protection of Plant Varieties and Farmers’ Rights Act, 2001, the last expressly to give effect to Article 27.3(b).

India used the flexibilities fully. In Novartis AG v. Union of India, 2013 INSC 198, (2013) 6 SCC 1, the Supreme Court refused a patent for the beta crystalline form of imatinib mesylate (Glivec), holding that under section 3(d) a new form of a known substance must show enhanced therapeutic efficacy; increased bioavailability and better flow properties were not enough. The Court read section 3(d) as a deliberate legislative choice to prevent “evergreening”. In Bayer Corporation v. Natco Pharma, the Controller of Patents in 2012 granted India’s first compulsory licence under section 84, for the cancer drug sorafenib, because Bayer’s price was not reasonably affordable and the drug was not available to most patients; the order was upheld by the IPAB in 2013 and by the Bombay High Court in 2014. Both are examples of using TRIPS’ own limits, not departures from it. (The patent provisions themselves are dealt with in the IPR I patent notes.)

5. WTO dispute settlement

June 2025 asked about this mechanism. Under the Dispute Settlement Understanding (DSU), administered by the Dispute Settlement Body (DSB) of all members:

• Consultations: the complaining member requests consultations; if no settlement within sixty days, it may ask for a panel. Good offices, conciliation and mediation are available.
• Panel: usually three experts, which examines the facts and law and issues a report, normally within six to nine months.
• Appellate Body: seven members, of whom three hear each appeal on points of law, ordinarily within ninety days.
• Adoption: reports are adopted by the DSB unless all members decide by consensus not to adopt (“negative consensus”), which makes adoption almost automatic.
• Implementation: the losing member must comply within a reasonable period. Failing that, the parties may agree compensation, or the DSB may authorise the winner to suspend concessions (retaliation), including in another sector or agreement (cross-retaliation, so a trade breach can be answered through TRIPS or the reverse).

The Appellate Body has been unable to hear appeals since December 2019, because the United States has blocked new appointments. Appeals filed since then lie “into the void”, and some members have set up an interim appeal arbitration arrangement (the MPIA), which India has not joined.

How this is examined

February 2025 asked “Discuss the background and salient features of TRIPS agreement”, January 2026 set a short note on TRIPS, and June 2025 the WTO dispute settlement mechanism. For the essay, use sections 1 and 2, and end with section 4 for the syllabus item “TRIPS and Indian IPR”. For the short note, give the date, the three principles, the term of each right and one line on enforcement and dispute settlement. Paris Convention and WIPO questions (also set in June 2025) are covered in the IPR I notes “The Paris Convention for the Protection of Industrial Property, 1883” and “The World Intellectual Property Organisation (WIPO)”.