2. Agenda
• Introduction
• History and Treaties
• Types of IPR
• Why do we need IPR?
• TRIPS
• TRIMS
• Limitations of IPR
• Current Issues
• Implications for MNEs
2/20/2012 Group 20 2
3. What is Intellectual Property and IPR?
• Intellectual property (IP) is a term referring to a number of distinct
types of creations of the mind for which a set of exclusive rights are
recognized and the corresponding fields of law.
• Under IPR, owners are granted certain exclusive rights to a variety of
intangible assets, such as musical, literary, and artistic works;
discoveries and inventions; and words, phrases, symbols, and designs.
• Monitored by World Intellectual Property Organization (WIPO),
Switzerland.
2/20/2012 Group 20 3
4. History
• The need for a system arose when foreign exhibitors refused to attend an
International Exhibition of Inventions in Vienna in 1873 because they were
afraid that their ideas would be stolen and will be emulated in other countries.
• 1883 - Paris Convention for the Protection of Industrial Property.
• 1886 - Berne Convention for the Protection of Literary and Artistic Works. It
gave rights to control, and receive payment for, the use of literary and artistic
works.
• Both Conventions set up International Bureaus to carry out administrative
tasks, such as organizing meetings of the Member States.
• 1893 - United International Bureaus for the Protection of Intellectual
Property - best known by its French acronym, BIRPI.
• BIRPI was the predecessor of what is today known as the World Intellectual
Property Organization or WIPO. Source: http://www.wto.org/
2/20/2012 Group 20 4
5. Treaties
• There are 21 international treaties in the field of intellectual property, which
are administered by WIPO.
• The treaties fall into three groups namely
• treaties, which establish international protection
• treaties, which facilitate international protection and
• treaties, which establish classification systems.
• 1994 Uruguay round - Agreement on Trade-Related Aspects of Intellectual
Property Rights (TRIPs) and Agreement on Trade Related Investment
Measures (TRIMs) by WTO (then GATT).
• 1996 - An Agreement between WIPO and the WTO provides for cooperation
concerning the implementation of the TRIPS Agreement, such as notification
of laws and regulations, and legislative assistance to member countries.
Source: http://www.wipo.int
2/20/2012 Group 20 5
6. Types of IPR
Intellectual property is divided into two categories
Industrial property which includes
• patents for inventions,
• trademarks,
• industrial designs and
• geographical indications
Copyright and related rights which cover
• literary and artistic expressions (e.g. books, films, music,
architecture, art),
• rights of performing artists in their performances, producers of
phonograms in their recordings, and broadcasters in their radio
and television broadcasts which are also referred to as
neighbouring rights.
2/20/2012 Group 20 6
8. • Copyrights - a legal concept giving the creator of an original
work exclusive rights to it, usually for a limited time.
• Trademarks - a distinctive sign or indicator used by an
individual, business organization, or other legal entity to identify
those products or services to consumers
• Patents - a set of exclusive rights granted by a sovereign state to
an inventor for a limited period of time in exchange for the
public disclosure of an invention.
• Industrial design rights - protects the visual design of objects
that are not purely utilitarian.
• Geographical Indication - place names (in some countries also
words associated with a place) used to identify the origin and
quality, reputation or other characteristics of products
• Trade Secrets
2/20/2012 Group 20 8
9. Piracy rates in 2010
• Developed countries have less
piracy
• Poor countries are more prone to
piracy due to lack of resources
• China in top 25 pirated nations
due to lack of IPR laws
Source: http://newsbytes.ph/2011/05/12/ph-piracy-rate-in-
2010-steady-at-69-but-losses-rise-to-278m/
2/20/2012 Group 20 9
10. “We can copy everything except your mother”
1. Chinese IP laws are unsophisticated.
2. The IP rights in China are of poor quality.
3. IP Laws and poor enforcement favour domestic interests.
4. Foreign parties cannot access the enforcement system.
5. Chinese patent office only came into existence by 1984.
• Reason- The combination of deteriorating IPR enforcement, domestic
protectionism and human resource constraints
• 212 cases filed in Chinese courts between 2006 and spring 2011.
• The main allegation was of patent, trademark, copyright, or trade
dress infringement.
Source: http://www.chinaipr.gov.cn &
Intellectual Property Rights in China (e3g Report)
2/20/2012 Group 20 10
11. Why do we need IPR?
• Incentive to produce
• Protects the Creator
Protects innovators from theft.
Individuals have all elements of control.
Easy to sort out disputes between individuals.
• Document Creations
Creators document their innovations.
Provide creators the freedom to converse about their innovation.
2/20/2012 Group 20 11
13. TRIPS
• Negotiated in the 1986-94 Uruguay Round
• Trade Related Aspects of Intellectual Property Rights (TRIPS) is a World
Trade Organization (WTO) agreement designed by developed countries to
enforce a global minimum standard of Intellectual Property Rights.
• Only one actually enforceable under GATT Arts. XXI & XXII & the WTO
dispute settlement understanding.
• Since TRIPS is part of the WTO agreements, developing countries that
want access to the global market through the WTO must accept the TRIPS
agreement, and integrate its IPR standards into their national legislation.
2/20/2012 Group 20 13
14. Broad Issues dealt in the Agreement
• How basic principles of the trading system and other international
intellectual property agreements should be applied
• How to give adequate protection to intellectual property rights
• How countries should enforce those rights adequately in their own
territories
• How to settle disputes on intellectual property between members of
the WTO
• Special transitional arrangements during the period when the new
system is being introduced.
2/20/2012 Group 20 14
15. TRIPS:Standards for IIP
Patent
• Patents shall be granted for any inventions, whether products or processes,
provided they are new, involve an inventive step, & are capable of industrial
application.
• Patents shall be granted in all fields of technology.
Trademark
• Defines what types of signs must be eligible for protection as trademarks.
• Service marks protected the same way.
Copyright
• Protection of computer programs as literary works & of compilations of data.
• The agreement says performers must also have the right to prevent unauthorized
recording, reproduction and broadcast of live performances (bootlegging) for no
less than 50 years.
2/20/2012 Group 20 15
16. TRIPS:Standards for IIP
Industrial Designs
• Protection should be conferred on designs which are new or original.
• Exclusive rights can be exercised against acts for commercial purposes,
including importation.
• The minimum term of protection is 10 years
Trade Secrets
• Undisclosed commercial information is to be protected against unfair
commercial practices
• Secret data submitted for the approval of new chemical entities
for pharmaceutical & agrochemical products should be protected against
unfair commercial use & disclosure by governments.
Geographical Indication
• The TRIPS Agreement says countries have to prevent this misuse of place
names.
2/20/2012 Group 20 16
17. Provision on basic principles
• National treatment
”each Member shall accord to the nationals of other Members
treatment no less favourable than it accords to its own nationals with
regard to the protection of intellectual property” (Art. 3)
• Most-Favoured-Nation Treatment
”With regard to the protection of intellectual property, any advantage,
favour, privilege or immunity granted by a Member to the nationals of
any other country shall be accorded immidiately and unconditionally to
the nationals of all other Members” (Art. 4)
2/20/2012 Group 20 17
18. Other provisions
ENFORCEMENT PROVISIONS
• General obligations like enforcement procedures must be available;
procedures to be fair and equitable etc
• Special obligations like enforcing provisions for enforcing civil and
administrative procedures like Disposal of infringing goods, Right of
information etc
DISPUTE SETTLEMENT
• Aims for prevention of disputes through provisions on transparency
• Settlement of disputes through panel procedures and decisions and
trade sanctions in case decisions are not adhered to.
2/20/2012 Group 20 18
19. IMPLEMENTATION & IMPACT
• Transition period
Developing countries (2005)
Least developed countries to implement TRIPS was extended to
2013, and until 1 January 2016 for pharmaceutical patents.
• Impact of TRIPs on Pharmaceutical industry in developed and
developing countries
• Relaxation
Doha Declaration(2001)- circumvents patent rights for access to
essential medicines through compulsory licenses.
2/20/2012 Group 20 19
20. Diff b/w TRIPS and Indian Patent Act
2/20/2012 Group 20 20
22. TRIMS
• Agreement on Trade Related Investment Measures (Uruguay round )
• TRIMs are rules that apply to the domestic regulations a country applies
to foreign investors
• Restrictions:
1. Include local content requirements
2. Manufacturing requirements
3. Trade balancing requirements
4. Domestic sales requirements
5. Technology transfer requirements
6. Export performance requirements
7. Local equity restrictions
8. Foreign exchange restrictions
9. Remittance restrictions
10. Licensing requirements
11. Employment restrictions
2/20/2012 Group 20 22
23. Legal Framework
• The TRIMs agreement does not provide any new language
• It focusses on two Articles that were identified in a previous case
under the GATT
– Article III (National Treatment)
• National treatment of imported product, unless specified in
other agreements
• Subjects the purchase or use by an enterprise of imported
products to less favorable conditions than the purchase or use of
domestic products
– Article XI (Quantitative Restrictions)
• Prohibition of quantitative restrictions on imports and exports
• Part of the general trend in textiles and agriculture to phase out
the use of quantitative restrictions
2/20/2012 Group 20 23
24. Aims of the Agreement
• Desiring
to promote the expansion and progressive liberalisaiton of
world trade and to facilitate investment, while ensuring
competition
• Take into account
trade, development and financial needs of developing
countries, particularly least developed countries
• Recognising
certain investment measures can cause trade-restrictive and
distorting effects
2/20/2012 Group 20 24
25. Notification
• Governments of WTO members, or countries entitled to be
members within 2 years after 1 January, 1995 should make
notifications within 90 days after the date of their acceptance
of the WTO agreement.
2/20/2012 Group 20 25
26. India’s notified TRIMs
• TRIMs Agreement India had notified three trade related
investment measures as inconsistent with the provisions of the
Agreement:
1. Local content (mixing) requirements in the production of News
Print,
2. Local content requirement in the production of Rifampicin and
Penicillin – G, and
3. Dividend balancing requirement in the case of investment in 22
categories consumer goods.
2/20/2012 Group 20 26
27. Transition periods
• Members are obliged to eliminate TRIMs which have been
notified. Such elimination is to take place within
– two years for developed countries
– five years for developing countries
– seven years for LDC
2/20/2012 Group 20 27
28. Implementation Difficulties
• Difficulties in identifying TRIMs that violate the agreement
• Difficulties in identifying alternative policies to achieve the
same objective
• Difficulties in accounting for non-contingent outcomes such as
the financial crisis in Asia and Latin America
• Difficulties in meeting the transition period deadlines
• LDCs lack the capacity to identify measures that are
inconsistent with the TRIMs agreement and hence are unable
to meet the notification deadline.
2/20/2012 Group 20 28
29. Patent filings rebound in 2010
• Patent filings worldwide grew by 7.2% in 2010.
• China and the US, which accounted for four-fifths of
worldwide growth.
• Japan and the US the main contributors for patent grants
worldwide
• Japan and the US the main contributors for patent grants
worldwide
2/20/2012 Group 20 29
33. Limitations
• Monopoly On Creation
Creator holds a monopoly over his creation.
Power in the hands of one person or company.
Companies can charge any amount they desire.
• Benefit Large Businesses
benefit large corporations and businesses not individuals
New innovations, are costly.
Outdated patents to generate income rather then creating
new, efficient innovations.
2/20/2012 Group 20 33
34. Current Issues
• IPL brands - intellectual
property bouquets (2009)
• Delhi's Nehru Place among
IPR infringing IT markets (Dec
2011)
• The Apple v Samsung Patent
War (2011)
2/20/2012 Group 20 34
35. Implications for MNEs
• MNEs should invest in countries where IPR laws are properly
enforced
• No technology diffusion will happen in the countries which
complies with IPR laws.
• Gives an incentive for innovative MNEs.
• MNEs in developing countries with limited R&D capabilities will
have a negative impact due to IPR laws.
2/20/2012 Group 20 35
BIRPI - Bureaux Internationaux Reunis pour la Protection de la Propiete Intellectuelle
The Uruguay Round was the 8th round of Multilateral trade negotiations (MTN) conducted within the framework of the General Agreement on Tariffs and Trade (GATT), spanning from 1986-1994 and embracing 123 countries as “contracting parties”. The Round transformed the GATT into the World Trade Organization. The Round came into effect in 1995 and has been implemented over the period to 2000 (2004 in the case of developing country contracting parties) under the administrative direction of the newly created World Trade Organization (WTO).
http://www.chinaipr.gov.cn/newsarticle/news/chinaworld/201101/1186269_1.htmlChinese patent office only came into existence by 1984
Pro--Protects the CreatorNew innovations are often both creatively and expensive endeavours. The creation of copyright laws has protected innovators from investing huge amounts of time and money into a project, only to have it stolen. Instead, individuals have all elements of control over their property and have a legal channel to look to if another person infringes upon their rights. Copyright laws also provide courts with a legal guide when dealing with issues regarding intellectual property theft, making it easier to sort out disputes between individuals.Pro--Document CreationsThe establishment of the copyright laws has led to more creators documenting their innovations. Prior to copyright laws, individuals were extra secretive, sometimes choosing not to document the innovation for fear of the idea being stolen. Now, most individuals choose to register their item as soon as possible, which documents the creation of all new innovations. Copyright laws and registration provide creators the freedom to converse about their innovation without worrying that their idea be replicated without their permission.
it strikes a balance between the long term benefits and possible short term costs to society. Society benefits in the long term when intellectual property protection encourages creation and invention, especially when the period of protection expires and the creations and inventions enter the public domain. Governments are allowed to reduce any short term costs through various exceptions, for example to tackle public health problems.
PatentPatents shall be granted in all fields of technology. No discrimination is allowed with respect to the place of invention, or based on whether the products are locally-produced or imported.The agreement defines what types of signs must be eligible for protection as trademarks, and what the minimum rights conferred on their owners must be. It says that service marks must be protected in the same way as trademarks used for goods. Marks that have become well-known in a particular country enjoy additional protection.
Industrial designsUnder the TRIPS Agreement, industrial designs must be protected for at least 10 years. Owners of protected designs must be able to prevent the manufacture, sale or importation of articles bearing or embodying a design which is a copy of the protected design.Geographical indicationUsing the place name when the product was made elsewhere or when it does not have the usual characteristics can mislead consumers, and it can lead to unfair competition. The TRIPS Agreement says countries have to prevent this misuse of place names.
national treatment (treating one’s own nationals and foreigners equally)most-favoured-nation treatment (equal treatment for nationals of all trading partners in the WTO). National treatment is also a key principle in other intellectual property agreements outside the WTO.
Why enforcement provisions ?Discontent as to the way in which counterfeiting and piracy was dealt with in national laws and applied
The obligations under TRIPS apply equally to all member states, however developing countries were allowed extra time to implement the applicable changes to their national laws, in two tiers of transition according to their level of development. The transition period for developing countries expired in 2005. The transition period for least developed countries to implement TRIPS was extended to 2013, and until 1 January 2016 for pharmaceutical patents, with the possibility of further extension.TRIPS Agreement may lead to high drug prices, low access to medicines and a weakening of pharmaceutical industries in the developing countries. It is feared that patent protection for pharmaceutical products and processes will have the effect of reducing or eliminating competition from generic production of medicines.
Came into effect from 1 Jan 1995In favor of MNEFDI grew but with restrictions by the host country
LDCs lackthe capacity to identify measures that are inconsistent with the TRIMs agreementand hence are unable to meet the notification deadline.
The prohibition of "local content" requirement.However the Agreement, as it is biased towards the interests of MNEsFDI has not yielded the benefits anticipated by hosts Pros:Reduce imports Increases balance of payments benefits from FDIDesigned to reduce competition with domestic producersCons:Reduce the benefits of FDI to hostsHosts try to impose restrictions on the activities of MNEs so as to capture more of the benefitsBiased towards the interests of MNEsUndesirable social impactsLocal content requirements - industry will fail to improve its international competitivenessMNE wants to reduce tech diffusion and wants to maximize its profit by making its value chain efficient.
Patent filings worldwide grew by 7.2% in 2010, afterhaving fallen by -3.6% in 2009. That growth was drivenby a steep filing increase in China and the US, which accounted for four-fifths of worldwide growth. An all timehigh of 1.98 million applications were filed globally, consisting of 1.23 million resident applications and 0.75million non-resident applications.Japan and the US the main contributors forpatent grants worldwidehttp://www.wipo.int/export/sites/www/freepublications/en/intproperty/941/wipo_pub_941_2011.pdf
Pros & Cons of Copyright LawsBy Alexander Sam, eHow Contributor Print this articleRelated Searches:Copyright LawsFathers Rights LawsCopyright laws protect the creator, but limit access to the innovation because of the monopoly created by the copyrighted item.Copyright laws in the United States were created to protect the intellectual property of any person, including elements like authorship, musical, literary, architectural, pictorial, choreographic, pantomimic, graphic, sculptural, and cartographic creations. The laws govern, protect and provide legal guidance on instances where registered legal property has been reproduced without permission from the original creator. While offering advantages, such as protecting creators, copyright laws also have some disadvantages, like creating monopolies.Con--Monopoly On CreationOne of the cons associated with copyright laws is that the creator is provided legal support in holding a monopoly over his creation. He has the right to distribute the work, reproduce it, perform the work, or display the work. The right to monopolize the sale of the product or its reproduction puts a lot of power in the hands of one person or company. Monopolies over items, like prescription drugs, means that companies can charge any amount they desire, making the medicine too expensive for lower socioeconomic families or individuals to afford.Con--Benefit Large BusinessesUnfortunately, copyright laws most often benefit large corporations and businesses, rather then individuals. Patents on intellectual property are bought by large businesses and then extended indefinitely through the copyright office, leaving little expired copyright material for the public domain. Instead of helping the public with innovations, they become a costly burden that can only be accessed by the wealthy. Companies also rely on outdated patents to generate income rather then creating new, more efficient innovations.Read more: Pros & Cons of Copyright Laws | eHow.com http://www.ehow.com/list_6960466_pros-cons-copyright-laws.html#ixzz1j4tvjRzK
Kolkata Knight Riders, owned by actor Shah Rukh Khan, for financial services, insurance, websites, telecom, entertainment and beauty care products. "Nehru Place is reportedly one of the many markets in major cities throughout India that are known for dealing in large volumes of pirated software, pirated optical media containing movies and music, and counterfeit goods,The markets listed include, for example, the Chinese website Taobao, a site offering a variety of infringing products to consumers and businesses in April 2011 when Apple filed suit against Samsung in the US, claiming that the Samsung’s smartphones and tablets “slavishly copied” Apple’s iPhone and iPad designs.Samsung fought back, counter-claiming that Apple infringed patents owned by Samsung relating to the user interface (including methods of displaying information on the screen, customising the home screen, as well as, rather pettily, the icon that is displayed when the phone is in airplane mode).3G technology such as the high speed packet access patent (owned by Samsung) and other patents relating to the operation of the devices. It seems that Samsung has the upper hand here, with more patents in these areas in its artillery, however as yet not one sanction has been imposed against Apple.
