Balancing Provisions in TRIPS and the Doha Declaration, 2001

1. Objectives and principles

The preamble recognises that IP rights are private rights, but also “the underlying public policy objectives of national systems for the protection of intellectual property, including developmental and technological objectives”, and the special needs of least-developed countries for maximum flexibility.

Article 7 (Objectives): “The protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations.”

Article 8 (Principles): (1) members may adopt measures necessary to protect public health and nutrition and to promote the public interest in sectors of vital importance to their socio-economic and technological development, provided they are consistent with the Agreement; (2) appropriate measures, consistent with the Agreement, may be needed to prevent abuse of IP rights or practices that unreasonably restrain trade or adversely affect the international transfer of technology.

The proviso “consistent with the provisions of this Agreement” has led some to read Article 8 as adding nothing. The better view, supported by the Doha Declaration and by the panel in Australia — Tobacco Plain Packaging (2018), is that Articles 7 and 8 shape how every other provision is interpreted, including what is “reasonable” or “justifiable” under the exceptions.

2. Room in the definitions

• Article 1.1: members are free to determine the appropriate method of implementing the Agreement within their own legal system and practice.
• Article 6: nothing in the Agreement (for dispute settlement purposes) addresses exhaustion, so each member chooses national, regional or international exhaustion, and hence whether to allow parallel imports.
• Patentability criteria: “new”, “inventive step” and “industrial application” are undefined, so a member may set them high, as India does in section 3(d).
• Article 39.3: test data submitted for marketing approval must be protected against unfair commercial use and disclosure, but no period of data exclusivity is required. India gives none.

3. Exclusions: Article 27(2) and (3)

• 27(2): members may exclude inventions whose commercial exploitation must be prevented to protect ordre public or morality, including to protect human, animal or plant life or health or to avoid serious prejudice to the environment, provided the exclusion is not made merely because exploitation is prohibited by domestic law. Implemented in section 3(b) of the Patents Act.
• 27(3)(a): diagnostic, therapeutic and surgical methods for humans or animals.
• 27(3)(b): plants and animals other than micro-organisms, and essentially biological processes, but plant varieties must be protected by patents, an effective sui generis system or both. India’s PPV&FR Act uses this choice. The provision was to be reviewed four years after the Agreement came into force; the review has never concluded.

4. Exceptions to the rights

The “three-step tests” in Article 13 (copyright), Article 17 (fair use of descriptive terms in trade marks), Article 26.2 (designs) and Article 30 (patents). Article 30 allows limited exceptions that do not unreasonably conflict with the normal exploitation of the patent and do not unreasonably prejudice the legitimate interests of the patent owner, taking account of the legitimate interests of third parties. In Canada — Pharmaceutical Patents (2000) the panel upheld Canada’s regulatory review (Bolar) exception but struck down its stockpiling exception. Research and Bolar exceptions, such as India’s section 107A, rest on Article 30.

5. Compulsory licences and government use: Article 31

Article 31 does not limit the grounds on which a member may authorise use without the patent holder’s consent; it sets conditions:

1. each case considered on its merits;
2. prior effort to obtain a voluntary licence on reasonable commercial terms, waived for national emergency, extreme urgency and public non-commercial use;
3. scope and duration limited to the purpose; non-exclusive; non-assignable;
4. use predominantly for the supply of the domestic market (Article 31(f));
5. adequate remuneration taking into account the economic value of the authorisation;
6. judicial or other independent review; and
7. relaxed conditions where the licence remedies anti-competitive practices (Article 31(k)).

Article 27.1 forbids discrimination as to the field of technology and whether products are imported or locally produced, which raised the question whether non-working by local manufacture can ground a licence. India’s section 84 treats working as a factor; the US complaint against Brazil’s local working rule (2001) was withdrawn without a ruling.

6. Competition and development

• Article 40: members may control licensing practices that are anti-competitive, such as exclusive grant-backs, conditions preventing validity challenges, and coercive package licensing.
• Articles 65 and 66.1: transition periods. For least-developed countries the general period now runs to 1 July 2034, and for pharmaceutical products to 1 January 2033.
• Article 66.2: developed members “shall provide incentives” to their enterprises and institutions to promote technology transfer to least-developed members. Developed countries report to the TRIPS Council, but the reports mostly describe general aid programmes, and LDCs say the obligation has had little effect.
• Article 67: technical and financial cooperation.

7. The Doha Declaration on the TRIPS Agreement and Public Health, 2001

Adopted at the Doha Ministerial Conference on 14 November 2001, after the HIV/AIDS drug price crisis and the withdrawal of the industry suit against South Africa.

• Paragraph 3: IP protection is important for new medicines, and there are concerns about its effects on prices.
• Paragraph 4: the Agreement “does not and should not prevent members from taking measures to protect public health”, and “can and should be interpreted and implemented in a manner supportive of WTO members’ right to protect public health and, in particular, to promote access to medicines for all.”
• Paragraph 5: (a) each provision is to be read in the light of the Agreement’s object and purpose as expressed in its objectives and principles; (b) each member has the right to grant compulsory licences and the freedom to determine the grounds; (c) each member may determine what is a national emergency or extreme urgency, and public health crises such as HIV/AIDS, tuberculosis and malaria can be such; (d) each member is free to set its own exhaustion regime.
• Paragraph 6: members without manufacturing capacity cannot use compulsory licences effectively because of Article 31(f); the TRIPS Council was asked for a solution.
• Paragraph 7: the least-developed countries’ transition for pharmaceutical patents was extended.

Legal status. It is not a formal authoritative interpretation under Article IX:2 of the WTO Agreement, but it was adopted by consensus of all members at ministerial level, so it can be treated as a subsequent agreement on interpretation under Article 31(3)(a) of the Vienna Convention on the Law of Treaties. The Plain Packaging panel took that view of paragraph 5(a).

What followed. The General Council decision of 30 August 2003 waived Article 31(f) for exports to eligible importing members; it became Article 31bis, in force from 23 January 2017. India’s section 92A implements it. It has been used once (Canada to Rwanda, 2008). The Ministerial Decision on the TRIPS Agreement of June 2022 (MC12) eased compulsory licensing for COVID-19 vaccines, including for export, for five years; extension to therapeutics and diagnostics was not agreed. SDG target 3.b refers to the Doha Declaration by name.

How this is examined

Likely long questions: “Discuss the balancing provisions of the TRIPS Agreement,” “Examine the significance of the Doha Declaration on TRIPS and Public Health, 2001,” or “TRIPS flexibilities are adequate to protect public health. Comment.” Short notes: Articles 7 and 8; Article 31; Article 31bis; Article 27(2); Article 66.2. Group the provisions by function, give the Doha paragraphs, and assess with the Indian example.