Technical note: EU papers on COVID-19, for June-July 2021 WTO meetings

Parallel or alternative? The papers dodge discussing the wavier

This technical note accompanies “Waiver: too soon to predict despite US support
and “
Does the new draft move the talks forward?

By Peter Ungphakorn
POSTED JUNE 5, 2021 | UPDATED JULY 21, 2021

The European Union circulated two new “communications” in the World Trade Organization (WTO) on June 4, 2021, on how the organisation could help improve equitable access to COVID-19 vaccines and therapeutics.

The move came after two developments within a month. First, the US government announced on May 5, 2021 it was backing the waiver of intellectual property protection related to COVID-19.

Then India, South Africa and their allies circulated a revised draft of the waiver on May 25, which in its full version would allow countries to voluntarily suspend protection for copyright, industrial designs, patents and trade secrets where related to the pandemic.

The two EU papers were submitted to two WTO councils, both comprising the full membership: to the General Council, which is the highest decision-making body below the biennial Ministerial Conference; and to the TRIPS Council, which handles “trade-related aspects of intellectual property rights”.

The TRIPS Council is due to meet on June 8 and 9. That means the EU missed the 10-day deadline before a meeting to add its paper to the agenda, although it can present the paper under “other business”. The General Council is due to meet on July 27 and 28.

The EU’s thoughts are explained in a press release with links to relevant material.

The “communications” contain three proposals, which will receive the most attention, particularly the one on intellectual property. But they are also partly reports on what the EU has done, and partly explanations for what lies behind the proposals.

The three proposals would be in a global trade initiative for equitable access to COVID-19 vaccines and therapeutics:

  • To strengthen supply chains and make export restrictions more targeted, transparent, proportionate, temporary and consistent with WTO agreements
  • To support the expansion of production, with manufacturers involved, through licensing, sharing know-how, tiered pricing (cheaper or non-profit sales to poorer countries), contract manufacturing and investment in production
  • To make current intellectual property rules easier to use, emphasising compulsory licensing and other flexibilities in the rules on patents
Intellectual property: compulsory licensingBack to top

The paper for the TRIPS Council elaborates that third proposal, on intellectual property. Some critics were poised to attack it as a rival to the proposed waiver, but the EU dodges the prospect.

All it says (in the General Council document) is that the EU “is also open to examine other options, and proposals, including on intellectual property, as long as they contribute towards the objectives of expanding production and facilitating equitable access to COVID-19 vaccines and therapeutics”.

That would seem to put the onus on the waiver’s supporters to demonstrate that suspending intellectual property protection would “contribute towards the objectives”.

Whether or not it also reflects differences among EU member states, however nuanced, remains to be seen.

Without rejecting the waiver, the EU does argue that the quick development of safe and effective COVID-19 vaccines shows the value of intellectual property protection together with public financing as an incentive.

The EU’s proposal on intellectual property rights aims to make it easier for countries to bypass some patent rights, through “compulsory licensing”. This is when a government allows someone else to produce a patented product or use a patented process without the consent of the patent owner, or when it plans to use the patented invention itself.

Responding to the accusation that the rules on compulsory licensing are too cumbersome, the EU proposes streamlining the procedures by clarifying what the existing rules allow and in some cases by agreement among WTO members.

Interpretation or clarification of the rules can be by a decision in the Ministerial Conference, or the General Council acting on its behalf.

First, the EU says the pandemic must be seen as an emergency. Under existing rules, that allows a number of procedural steps to be avoided so countries can jump straight to a compulsory licence without having to negotiate with the patent-owner first. This, the EU says, should also apply to compulsory licences for export, through a clarification.

Second, the rules require patent-owners to be paid a certain amount even under a compulsory licence. How much that would be is vague and open to legal interpretation. To simplify this, the EU proposes a clarification that the remuneration would reflect the “affordable prices” for sales in low- and middle-income countries, including through the international COVAX facility.

Third, the EU proposes simplifying the transparency requirements when the products are exported under compulsory licensing. Whether or not these are “onerous” is debated.

The EU has responded to the criticism by proposing that in a pandemic, a single notification from the exporting country should be enough. It would list all the countries to be supplied (directly or through COVAX). Normally several notifications are needed from the exporting and importing countries.

(The EU is proposing that this be done by agreement among members, presumably a decision by the General Council as a clarification rather than amending the rules.)

Other pointsBack to top

A number of questions are raised by this proposal.

One is how the waiver’s supporters respond. They could be happy to discuss ideas that might work in parallel to their own proposal. Or they could see the proposal to streamline compulsory licensing procedures as undermining their own argument that the waiver is needed because compulsory licensing doesn’t work.

Another is the scope of the discussions. So far, the US has only mentioned “vaccines” in its backing for the waiver, whereas the proponents want to include a considerably wider range of products. Here, the EU refers to “vaccines and therapeutics”, although not in the context of waiving intellectual property rights.

Also noteworthy is the EU’s repeated support for WTO Director-General Ngozi Okonjo-Iweala to play a central role through her high-profile campaign “to address the challenges of equitable access to COVID-19 vaccines and therapeutics,” and by producing reports on WTO issues such as supply chains and export restrictions.

The EU also refers to a proposal for a General Council declaration on trade and health, for “COVID-19 and beyond”. Sponsored by 52 WTO members (counting the EU as 28, ie, the EU and its 27 members), the declaration focuses on removing obstacles to trade related to the pandemic, improving transparency and cooperation between the WTO and other organisations.

Updates: July 21, 2021 — correcting the dates of the July 2021 General Council meeting

Image credits:
Featured image (map and vaccine) | Frauke Riether, Pixabay CCO