An overview of the
Agreement on Trade-Related Aspects of
Intellectual Property Rights (TRIPS Agreement)
Main features of
the TRIPS Agreement
The TRIPS Agreement,
which came into effect on 1 January 1995, is to
date the most comprehensive multilateral
agreement on intellectual property. The areas of
intellectual property that it covers are:
copyright and related rights (i.e. the rights of
performers, producers of sound recordings and
broadcasting organizations); trademarks including
service marks; geographical indications including
appellations of origin; industrial designs;
patents including the protection of new varieties
of plants; the layout-designs of integrated
circuits; and undisclosed information including
trade secrets and test data.
The three main
features of the Agreement are:
(i) Standards.
In respect of each of the main areas of
intellectual property covered by the TRIPS
Agreement, the Agreement sets out the minimum
standards of protection to be provided by each
Member. Each of the main elements of protection
is defined, namely the subject-matter to be
protected, the rights to be conferred and
permissible exceptions to those rights, and the
minimum duration of protection. The Agreement
sets these standards by requiring, first, that
the substantive obligations of the main
conventions of the WIPO, the Paris Convention for
the Protection of Industrial Property (Paris
Convention) and the Berne Convention for the
Protection of Literary and Artistic Works (Berne
Convention) in their most recent versions, must
be complied with. With the exception of the
provisions of the Berne Convention on moral
rights, all the main substantive provisions of
these conventions are incorporated by reference
and thus become obligations under the TRIPS
Agreement between TRIPS Member countries. The
relevant provisions are to be found in Articles
2.1 and 9.1 of the TRIPS Agreement, which relate,
respectively, to the Paris Convention and to the
Berne Convention. Secondly, the TRIPS Agreement
adds a substantial number of additional
obligations on matters where the pre-existing
conventions are silent or were seen as being
inadequate. The TRIPS Agreement is thus sometimes
referred to as a Berne and Paris-plus agreement.
(ii) Enforcement.
The second main set of provisions deals with
domestic procedures and remedies for the
enforcement of intellectual property rights. The
Agreement lays down certain general principles
applicable to all IPR enforcement procedures. In
addition, it contains provisions on civil and
administrative procedures and remedies,
provisional measures, special requirements
related to border measures and criminal
procedures, which specify, in a certain amount of
detail, the procedures and remedies that must be
available so that right holders can effectively
enforce their rights.
(iii) Dispute
settlement. The Agreement makes disputes
between WTO Members about the respect of the
TRIPS obligations subject to the WTO's dispute
settlement procedures.
In addition the
Agreement provides for certain basic principles,
such as national and most-favoured-nation
treatment, and some general rules to ensure that
procedural difficulties in acquiring or
maintaining IPRs do not nullify the substantive
benefits that should flow from the Agreement. The
obligations under the Agreement will apply
equally to all Member countries, but developing
countries will have a longer period to phase them
in. Special transition arrangements operate in
the situation where a developing country does not
presently provide product patent protection in
the area of pharmaceuticals.
The TRIPS Agreement is
a minimum standards agreement, which allows
Members to provide more extensive protection of
intellectual property if they so wish. Members
are left free to determine the appropriate method
of implementing the provisions of the Agreement
within their own legal system and practice.
Certain general
provisions
As in the main
pre-existing intellectual property conventions,
the basic obligation on each Member country is to
accord the treatment in regard to the protection
of intellectual property provided for under the
Agreement to the persons of other Members.
Article 1.3 defines who these persons are.
These persons are referred to as
"nationals" but include persons,
natural or legal, who have a close attachment to
other Members without necessarily being
nationals. The criteria for determining which
persons must thus benefit from the treatment
provided for under the Agreement are those laid
down for this purpose in the main pre-existing
intellectual property conventions of WIPO,
applied of course with respect to all WTO Members
whether or not they are party to those
conventions. These conventions are the Paris
Convention, the Berne Convention, International
Convention for the Protection of Performers,
Producers of Phonograms and Broadcasting
Organizations (Rome Convention), and the Treaty
on Intellectual Property in Respect of Integrated
Circuits (IPIC Treaty).
Articles 3, 4 and 5
include the fundamental rules on national and
most-favoured-nation treatment of foreign
nationals, which are common to all categories of
intellectual property covered by the Agreement.
These obligations cover not only the substantive
standards of protection but also matters
affecting the availability, acquisition, scope,
maintenance and enforcement of intellectual
property rights as well as those matters
affecting the use of intellectual property rights
specifically addressed in the Agreement. While
the national treatment clause forbids
discrimination between a Member's own nationals
and the nationals of other Members, the
most-favoured-nation treatment clause forbids
discrimination between the nationals of other
Members. In respect of the national treatment
obligation, the exceptions allowed under the
pre-existing intellectual property conventions of
WIPO are also allowed under TRIPS. Where these
exceptions allow material reciprocity, a
consequential exception to MFN treatment is also
permitted (e.g. comparison of terms for copyright
protection in excess of the minimum term required
by the TRIPS Agreement as provided under Article
7(8) of the Berne Convention as incorporated into
the TRIPS Agreement). Certain other limited
exceptions to the MFN obligation are also
provided for.
The general goals of
the TRIPS Agreement are contained in the Preamble
of the Agreement, which reproduces the basic
Uruguay Round negotiating objectives established
in the TRIPS area by the 1986 Punta del Este
Declaration and the 1988/89 Mid-Term Review.
These objectives include the reduction of
distortions and impediments to international
trade, promotion of effective and adequate
protection of intellectual property rights, and
ensuring that measures and procedures to enforce
intellectual property rights do not themselves
become barriers to legitimate trade. These
objectives should be read in conjunction with
Article 7, entitled "Objectives",
according to which 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, entitled
"Principles", recognizes the rights of
Members to adopt measures for public health and
other public interest reasons and to prevent the
abuse of intellectual property rights, provided
that such measures are consistent with the
provisions of the TRIPS Agreement.
Substantive
standards of protection
Copyright
During the Uruguay
Round negotiations, it was recognized that the
Berne Convention already, for the most part,
provided adequate basic standards of copyright
protection. Thus it was agreed that the point of
departure should be the existing level of
protection under the latest Act, the Paris Act of
1971, of that Convention. The point of departure
is expressed in Article 9.1 under which Members
are obliged to comply with the substantive
provisions of the Paris Act of 1971 of the Berne
Convention, i.e. Articles 1 through 21 of the
Berne Convention (1971) and the Appendix thereto.
However, Members do not have rights or
obligations under the TRIPS Agreement in respect
of the rights conferred under Article 6bis
of that Convention, i.e. the moral rights (the
right to claim authorship and to object to any
derogatory action in relation to a work, which
would be prejudicial to the author's honour or
reputation), or of the rights derived therefrom.
The provisions of the Berne Convention referred
to deal with questions such as subject-matter to
be protected, minimum term of protection, and
rights to be conferred and permissible
limitations to those rights. The Appendix allows
developing countries, under certain conditions,
to make some limitations to the right of
translation and the right of reproduction.
In addition to
requiring compliance with the basic standards of
the Berne Convention, the TRIPS Agreement
clarifies and adds certain specific points.
Article 9.2 confirms
that copyright protection shall extend to
expressions and not to ideas, procedures, methods
of operation or mathematical concepts as such.
Article 10.1 provides
that computer programs, whether in source or
object code, shall be protected as literary works
under the Berne Convention (1971). This provision
confirms that computer programs must be protected
under copyright and that those provisions of the
Berne Convention that apply to literary works
shall be applied also to them. It confirms
further, that the form in which a program is,
whether in source or object code, does not affect
the protection. The obligation to protect
computer programs as literary works means e.g.
that only those limitations that are applicable
to literary works may be applied to computer
programs. It also confirms that the general term
of protection of 50 years applies to computer
programs. Possible shorter terms applicable to
photographic works and works of applied art may
not be applied. Article 10.2 clarifies
that databases and other compilations of data or
other material shall be protected as such under
copyright even where the databases include data
that as such are not protected under copyright.
Databases are eligible for copyright protection
provided that they by reason of the selection or
arrangement of their contents constitute
intellectual creations. The provision also
confirms that databases have to be protected
regardless of which form they are in, whether
machine readable or other form. Furthermore, the
provision clarifies that such protection shall
not extend to the data or material itself, and
that it shall be without prejudice to any
copyright subsisting in the data or material
itself.
Article 11 provides
that authors shall have in respect of at least
computer programs and, in certain circumstances,
of cinematographic works the right to authorize
or to prohibit the commercial rental to the
public of originals or copies of their copyright
works. With respect to cinematographic works, the
exclusive rental right is subject to the
so-called impairment test: a Member is excepted
from the obligation unless such rental has led to
widespread copying of such works which is
materially impairing the exclusive right of
reproduction conferred in that Member on authors
and their successors in title. In respect of
computer programs, the obligation does not apply
to rentals where the program itself is not the
essential object of the rental.
According to the
general rule contained in Article 7(1) of the
Berne Convention as incorporated into the TRIPS
Agreement, the term of protection shall be the
life of the author and 50 years after his death.
Paragraphs 2 through 4 of that Article
specifically allow shorter terms in certain
cases. These provisions are supplemented by
Article 12 of the TRIPS Agreement, which provides
that whenever the term of protection of a work,
other than a photographic work or a work of
applied art, is calculated on a basis other than
the life of a natural person, such term shall be
no less than 50 years from the end of the
calendar year of authorized publication, or,
failing such authorized publication within 50
years from the making of the work, 50 years from
the end of the calendar year of making.
Article 13 requires
Members to confine limitations or exceptions to
exclusive rights to certain special cases which
do not conflict with a normal exploitation of the
work and do not unreasonably prejudice the
legitimate interests of the right holder. This is
a horizontal provision that applies to all
limitations and exceptions permitted under the
provisions of the Berne Convention and the
Appendix thereto as incorporated into the TRIPS
Agreement. The application of these limitations
is permitted also under the TRIPS Agreement, but
the provision makes it clear that they must be
applied in a manner that does not prejudice the
legitimate interests of the right holder.
Related rights
The provisions on
protection of performers, producers of phonograms
and broadcasting organizations are included in
Article 14. According to Article 14.1, performers
shall have the possibility of preventing the
unauthorized fixation of their performance on a
phonogram (e.g. the recording of a live musical
performance). The fixation right covers only
aural, not audiovisual fixations. Performers must
also be in position to prevent the reproduction
of such fixations. They shall also have the
possibility of preventing the unauthorized
broadcasting by wireless means and the
communication to the public of their live
performance.
In accordance with
Article 14.2, Members have to grant producers of
phonograms an exclusive reproduction right. In
addition to this, they have to grant, in
accordance with Article 14.4, an exclusive rental
right at least to producers of phonograms. The
provisions on rental rights apply also to any
other right holders in phonograms as determined
in national law. This right has the same scope as
the rental right in respect of computer programs.
Therefore it is not subject to the impairment
test as in respect of cinematographic works.
However, it is limited by a so-called
grand-fathering clause, according to which a
Member, which on 15 April 1994, i.e. the date of
the signature of the Marrakesh Agreement, had in
force a system of equitable remuneration of right
holders in respect of the rental of phonograms,
may maintain such system provided that the
commercial rental of phonograms is not giving
rise to the material impairment of the exclusive
rights of reproduction of right holders.
Broadcasting
organizations shall have, in accordance with
Article 14.3, the right to prohibit the
unauthorized fixation, the reproduction of
fixations, and the rebroadcasting by wireless
means of broadcasts, as well as the communication
to the public of their television broadcasts.
However, it is not necessary to grant such rights
to broadcasting organizations, if owners of
copyright in the subject-matter of broadcasts are
provided with the possibility of preventing these
acts, subject to the provisions of the Berne
Convention.
The term of protection
is at least 50 years for performers and producers
of phonograms, and 20 years for broadcasting
organizations (Article 14.5).
Article 14.6 provides
that any Member may, in relation to the
protection of performers, producers of phonograms
and broadcasting organizations, provide for
conditions, limitations, exceptions and
reservations to the extent permitted by the Rome
Convention.
Trademarks
The basic rule
contained in Article 15 is that any sign, or any
combination of signs, capable of distinguishing
the goods and services of one undertaking from
those of other undertakings, must be eligible for
registration as a trademark, provided that it is
visually perceptible. Such signs, in particular
words including personal names, letters,
numerals, figurative elements and combinations of
colours as well as any combination of such signs,
must be eligible for registration as trademarks.
Where signs are not
inherently capable of distinguishing the relevant
goods or services, Member countries are allowed
to require, as an additional condition for
eligibility for registration as a trademark, that
distinctiveness has been acquired through use.
Members are free to determine whether to allow
the registration of signs that are not visually
perceptible (e.g. sound or smell marks).
Members may make
registrability depend on use. However, actual use
of a trademark shall not be permitted as a
condition for filing an application for
registration, and at least three years must have
passed after that filing date before failure to
realize an intent to use is allowed as the ground
for refusing the application (Article 14.3).
The Agreement requires
service marks to be protected in the same way as
marks distinguishing goods (see e.g. Articles
15.1, 16.2 and 62.3).
The owner of a
registered trademark must be granted the
exclusive right to prevent all third parties not
having the owner's consent from using in the
course of trade identical or similar signs for
goods or services which are identical or similar
to those in respect of which the trademark is
registered where such use would result in a
likelihood of confusion. In case of the use of an
identical sign for identical goods or services, a
likelihood of confusion must be presumed (Article
16.1).
The TRIPS Agreement
contains certain provisions on well-known marks,
which supplement the protection required by
Article 6bis of the Paris Convention, as
incorporated by reference into the TRIPS
Agreement, which obliges Members to refuse or to
cancel the registration, and to prohibit the use
of a mark conflicting with a mark which is well
known. First, the provisions of that Article must
be applied also to services. Second, it is
required that knowledge in the relevant sector of
the public acquired not only as a result of the
use of the mark but also by other means,
including as a result of its promotion, be taken
into account. Furthermore, the protection of
registered well-known marks must extend to goods
or services which are not similar to those in
respect of which the trademark has been
registered, provided that its use would indicate
a connection between those goods or services and
the owner of the registered trademark, and the
interests of the owner are likely to be damaged
by such use (Articles 16.2 and 3).
Members may provide
limited exceptions to the rights conferred by a
trademark, such as fair use of descriptive terms,
provided that such exceptions take account of the
legitimate interests of the owner of the
trademark and of third parties (Article 17).
Initial registration,
and each renewal of registration, of a trademark
shall be for a term of no less than seven years.
The registration of a trademark shall be
renewable indefinitely (Article 18).
Cancellation of a mark
on the grounds of non-use cannot take place
before three years of uninterrupted non-use has
elapsed unless valid reasons based on the
existence of obstacles to such use are shown by
the trademark owner. Circumstances arising
independently of the will of the owner of the
trademark, such as import restrictions or other
government restrictions, shall be recognized as
valid reasons of non-use. Use of a trademark by
another person, when subject to the control of
its owner, must be recognized as use of the
trademark for the purpose of maintaining the
registration (Article 19).
It is further required
that use of the trademark in the course of trade
shall not be unjustifiably encumbered by special
requirements, such as use with another trademark,
use in a special form, or use in a manner
detrimental to its capability to distinguish the
goods or services (Article 20).
Geographical
indications
Geographical
indications are defined, for the purposes of the
Agreement, as indications which identify a good
as originating in the territory of a Member, or a
region or locality in that territory, where a
given quality, reputation or other characteristic
of the good is essentially attributable to its
geographical origin (Article 22.1). Thus, this
definition specifies that the quality, reputation
or other characteristics of a good can each be a
sufficient basis for eligibility as a
geographical indication, where they are
essentially attributable to the geographical
origin of the good. In respect of all
geographical indications, interested parties must
have legal means to prevent use of indications
which mislead the public as to the geographical
origin of the good, and use which constitutes an
act of unfair competition within the meaning of
Article 10bis of the Paris Convention
(Article 22.2).
The registration of a
trademark which uses a geographical indication in
a way that misleads the public as to the true
place of origin must be refused or invalidated ex
officio if the legislation so permits or at
the request of an interested party (Article
22.3).
Article 23 provides
that interested parties must have the legal means
to prevent the use of a geographical indication
identifying wines for wines not originating in
the place indicated by the geographical
indication. This applies even where the public is
not being misled, there is no unfair competition
and the true origin of the good is indicated or
the geographical indication is accompanied be
expressions such as "kind",
"type", "style",
"imitation" or the like. Similar
protection must be given to geographical
indications identifying spirits when used on
spirits. Protection against registration of a
trademark must be provided accordingly.
Article 24 contains a
number of exceptions to the protection of
geographical indications. These exceptions are of
particular relevance in respect of the additional
protection for geographical indications for wines
and spirits. For example, Members are not obliged
to bring a geographical indication under
protection, where it has become a generic term
for describing the product in question (paragraph
6). Measures to implement these provisions shall
not prejudice prior trademark rights that have
been acquired in good faith (paragraph 5). Under
certain circumstances, continued use of a
geographical indication for wines or spirits may
be allowed on a scale and nature as before
(paragraph 4). Members availing themselves of the
use of these exceptions must be willing to enter
into negotiations about their continued
application to individual geographical
indications (paragraph 1). The exceptions
cannot be used to diminish the protection of
geographical indications that existed prior to
the entry into force of the TRIPS Agreement
(paragraph 3). The TRIPS Council shall keep under
review the application of the provisions on the
protection of geographical indications (paragraph
2).
Industrial designs
Article 25.1 of the
TRIPS Agreement obliges Members to provide for
the protection of independently created
industrial designs that are new or original.
Members may provide that designs are not new or
original if they do not significantly differ from
known designs or combinations of known design
features. Members may provide that such
protection shall not extend to designs dictated
essentially by technical or functional
considerations.
Article 25.2 contains
a special provision aimed at taking into account
the short life cycle and sheer number of new
designs in the textile sector: requirements for
securing protection of such designs, in
particular in regard to any cost, examination or
publication, must not unreasonably impair the
opportunity to seek and obtain such protection.
Members are free to meet this obligation through
industrial design law or through copyright law.
Article 26.1 requires
Members to grant the owner of a protected
industrial design the right to prevent third
parties not having the owner's consent from
making, selling or importing articles bearing or
embodying a design which is a copy, or
substantially a copy, of the protected design,
when such acts are undertaken for commercial
purposes.
Article 26.2 allows
Members to provide limited exceptions to the
protection of industrial designs, provided that
such exceptions do not unreasonably conflict with
the normal exploitation of protected industrial
designs and do not unreasonably prejudice the
legitimate interests of the owner of the
protected design, taking account of the
legitimate interests of third parties.
The duration of
protection available shall amount to at least 10
years (Article 26.3). The wording "amount
to" allows the term to be divided into, for
example, two periods of five years.
Patents
The TRIPS Agreement
requires Member countries to make patents
available for any inventions, whether products or
processes, in all fields of technology without
discrimination, subject to the normal tests of
novelty, inventiveness and industrial
applicability. It is also required that patents
be available and patent rights enjoyable without
discrimination as to the place of invention and
whether products are imported or locally produced
(Article 27.1).
There are three
permissible exceptions to the basic rule on
patentability. One is for inventions contrary to ordre
public or morality; this explicitly includes
inventions dangerous to human, animal or plant
life or health or seriously prejudicial to the
environment. The use of this exception is subject
to the condition that the commercial exploitation
of the invention must also be prevented and this
prevention must be necessary for the protection
of ordre public or morality (Article
27.2).
The second exception
is that Members may exclude from patentability
diagnostic, therapeutic and surgical methods for
the treatment of humans or animals (Article
27.3(a)).
The third is that
Members may exclude plants and animals other than
micro-organisms and essentially biological
processes for the production of plants or animals
other than non-biological and microbiological
processes. However, any country excluding plant
varieties from patent protection must provide an
effective sui generis system of
protection. Moreover, the whole provision is
subject to review four years after entry into
force of the Agreement (Article 27.3(b)).
The exclusive rights
that must be conferred by a product patent are
the ones of making, using, offering for sale,
selling, and importing for these purposes.
Process patent protection must give rights not
only over use of the process but also over
products obtained directly by the process. Patent
owners shall also have the right to assign, or
transfer by succession, the patent and to
conclude licensing contracts (Article 28).
Members may provide
limited exceptions to the exclusive rights
conferred by a patent, provided that such
exceptions do not unreasonably conflict with a
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 (Article
30).
The term of protection
available shall not end before the expiration of
a period of 20 years counted from the filing date
(Article 33).
Members shall require
that an applicant for a patent shall disclose the
invention in a manner sufficiently clear and
complete for the invention to be carried out by a
person skilled in the art and may require the
applicant to indicate the best mode for carrying
out the invention known to the inventor at the
filing date or, where priority is claimed, at the
priority date of the application (Article 29.1).
If the subject-matter
of a patent is a process for obtaining a product,
the judicial authorities shall have the authority
to order the defendant to prove that the process
to obtain an identical product is different from
the patented process, where certain conditions
indicating a likelihood that the protected
process was used are met (Article 34).
Compulsory licensing
and government use without the authorization of
the right holder are allowed, but are made
subject to conditions aimed at protecting the
legitimate interests of the right holder. The
conditions are mainly contained in Article 31.
These include the obligation, as a general rule,
to grant such licences only if an unsuccessful
attempt has been made to acquire a voluntary
licence on reasonable terms and conditions within
a reasonable period of time; the requirement to
pay adequate remuneration in the circumstances of
each case, taking into account the economic value
of the licence; and a requirement that decisions
be subject to judicial or other independent
review by a distinct higher authority. Certain of
these conditions are relaxed where compulsory
licences are employed to remedy practices that
have been established as anticompetitive by a
legal process. These conditions should be read
together with the related provisions of
Article 27.1, which require that patent
rights shall be enjoyable without discrimination
as to the field of technology, and whether
products are imported or locally produced.
Layout-designs of
integrated circuits
Article 35 of the
TRIPS Agreement requires Member countries to
protect the layout-designs of integrated circuits
in accordance with the provisions of the IPIC
Treaty (the Treaty on Intellectual Property in
Respect of Integrated Circuits), negotiated under
the auspices of WIPO in 1989. These provisions
deal with, inter alia, the definitions of
"integrated circuit" and
"layout-design (topography)",
requirements for protection, exclusive rights,
and limitations, as well as exploitation,
registration and disclosure. An "integrated
circuit" means a product, in its final form
or an intermediate form, in which the elements,
at least one of which is an active element, and
some or all of the interconnections are
integrally formed in and/or on a piece of
material and which is intended to perform an
electronic function. A "layout-design
(topography)" is defined as the
three-dimensional disposition, however expressed,
of the elements, at least one of which is an
active element, and of some or all of the
interconnections of an integrated circuit, or
such a three-dimensional disposition prepared for
an integrated circuit intended for manufacture.
The obligation to protect layout-designs applies
to such layout-designs that are original in the
sense that they are the result of their creators'
own intellectual effort and are not commonplace
among creators of layout-designs and
manufacturers of integrated circuits at the time
of their creation. The exclusive rights include
the right of reproduction and the right of
importation, sale and other distribution for
commercial purposes. Certain limitations to these
rights are provided for.
In addition to
requiring Member countries to protect the
layout-designs of integrated circuits in
accordance with the provisions of the IPIC
Treaty, the TRIPS Agreement clarifies and/or
builds on four points. These points relate to the
term of protection (ten years instead of eight,
Article 38), the applicability of the protection
to articles containing infringing integrated
circuits (last sub clause of Article 36) and the
treatment of innocent infringers (Article 37.1).
The conditions in Article 31 of the TRIPS
Agreement apply mutatis mutandis to
compulsory or non-voluntary licensing of a
layout-design or to its use by or for the
government without the authorization of the right
holder, instead of the provisions of the IPIC
Treaty on compulsory licensing (Article 37.2).
Protection of
undisclosed information The TRIPS Agreement
requires undisclosed information -- trade secrets
or know-how -- to benefit from protection.
According to Article 39.2, the protection must
apply to information that is secret, that has
commercial value because it is secret and that
has been subject to reasonable steps to keep it
secret. The Agreement does not require
undisclosed information to be treated as a form
of property, but it does require that a person
lawfully in control of such information must have
the possibility of preventing it from being
disclosed to, acquired by, or used by others
without his or her consent in a manner contrary
to honest commercial practices. "Manner
contrary to honest commercial practices"
includes breach of contract, breach of confidence
and inducement to breach, as well as the
acquisition of undisclosed information by third
parties who knew, or were grossly negligent in
failing to know, that such practices were
involved in the acquisition.
The Agreement also
contains provisions on undisclosed test data and
other data whose submission is required by
governments as a condition of approving the
marketing of pharmaceutical or agricultural
chemical products which use new chemical
entities. In such a situation the Member
government concerned must protect the data
against unfair commercial use. In addition,
Members must protect such data against
disclosure, except where necessary to protect the
public, or unless steps are taken to ensure that
the data are protected against unfair commercial
use.
Control of
anti-competitive practices in contractual
licences
Article 40 of the
TRIPS Agreement recognizes that some licensing
practices or conditions pertaining to
intellectual property rights which restrain
competition may have adverse effects on trade and
may impede the transfer and dissemination of
technology (paragraph 1). Member countries may
adopt, consistently with the other provisions of
the Agreement, appropriate measures to prevent or
control practices in the licensing of
intellectual property rights which are abusive
and anti-competitive (paragraph 2). The Agreement
provides for a mechanism whereby a country
seeking to take action against such practices
involving the companies of another Member country
can enter into consultations with that other
Member and exchange publicly available
non-confidential information of relevance to the
matter in question and of other information
available to that Member, subject to domestic law
and to the conclusion of mutually satisfactory
agreements concerning the safeguarding of its
confidentiality by the requesting Member
(paragraph 3). Similarly, a country whose
companies are subject to such action in another
Member can enter into consultations with that
Member (paragraph 4).
Enforcement of
intellectual property rights
The provisions on
enforcement are contained in Part III of the
Agreement, which is divided into five Sections.
The first Section lays down general obligations
that all enforcement procedures must meet. These
are notably aimed at ensuring their effectiveness
and that certain basic principles of due process
are met. The following Sections deal with civil
and administrative procedures and remedies,
provisional measures, special requirements
related to border measures and criminal
procedures. These provisions have two basic
objectives: one is to ensure that effective means
of enforcement are available to right holders;
the second is to ensure that enforcement
procedures are applied in such a manner as to
avoid the creation of barriers to legitimate
trade and to provide for safeguards against their
abuse.
The Agreement makes a
distinction between infringing activity in
general, in respect of which civil judicial
procedures and remedies must be available, and
counterfeiting and piracy -- the more blatant and
egregious forms of infringing activity -- in
respect of which additional procedures and
remedies must also be provided, namely border
measures and criminal procedures. For this
purpose, counterfeit goods are in essence defined
as goods involving slavish copying of trademarks,
and pirated goods as goods which violate a
reproduction right under copyright or a related
right.
General obligations
The general
obligations relating to enforcement are contained
in Article 41. Paragraph 1 requires that
enforcement procedures must be such as to permit
effective action against any act of infringement
of intellectual property rights, and that the
remedies available must be expeditious in order
to prevent infringements and they must constitute
a deterrent to further infringements. On the
other hand, these procedures must be applied in
such a manner as to avoid the creation of
barriers to legitimate trade and to provide for
safeguards against their abuse.
The following three
paragraphs contain certain general principles,
the aim of which is to guarantee due process.
Paragraph 2 deals with enforcement procedures.
Such procedures must be fair and equitable, and
they may not be unnecessarily complicated or
costly, or entail unreasonable time-limits or
unwarranted delays. Paragraph 3 concerns
decisions on the merits of a case. Such decisions
shall preferably be in writing and reasoned, and
they shall be made available at least to the
parties to the proceeding without undue delay.
Decisions on the merits of a case shall be based
only on evidence in respect of which parties were
offered the opportunity to be heard. Paragraph 4
requires that parties to a proceeding shall have
an opportunity for review by a judicial authority
of final administrative decisions and, subject to
jurisdictional provisions in a Member's law
concerning the importance of a case, of at least
the legal aspects of initial judicial decisions
on the merits of a case. However, there is no
obligation to provide an opportunity for review
of acquittals in criminal cases.
According to paragraph
5, it is understood that the provisions on
enforcement do not create any obligation to put
in place a judicial system for the enforcement of
intellectual property rights distinct from that
for the enforcement of law in general, nor does
it affect the capacity of Members to enforce
their law in general. In addition, it is stated
that nothing in these provisions creates any
obligation with respect to the distribution of
resources as between enforcement of intellectual
property rights and the enforcement of law in
general. However, a number of countries have
found it helpful to establish special enforcement
units that pool together required experience
needed to effectively fight against
counterfeiting and piracy. Moreover, some
countries have centralized certain types of
intellectual property issues in one or a limited
number of courts in order to ensure the
availability of necessary expertise.
Civil and
administrative procedures and remedies
The second Section
requires that civil judicial procedures must be
available in respect of any activity infringing
intellectual property rights covered by the
Agreement. The provisions of the Section
elaborate in more detail basic features that such
procedures must provide for.
Article 42 contains
certain principles aiming at ensuring due
process. Defendants are entitled to written
notice which is timely and contains sufficient
details of the claims. Parties must be allowed to
be represented by independent legal counsel, and
procedures may not impose overly burdensome
requirements concerning mandatory personal
appearances. All parties are entitled to
substantiate their claims and to present all
relevant evidence, while confidential information
must be identified and protected.
Article 43 deals with
how the rules on evidence should be applied in
certain situations. In a situation where evidence
that is likely to be important for one party is
in the possession of the opposing party, the
court must be empowered, provided that certain
conditions are met, to order the latter party to
produce that evidence. In addition, courts may be
authorized to make their decisions on the basis
of information presented to them, if a party
refuses without good reason access to evidence
that is in his or her possession, subject to
providing the parties an opportunity to be heard.
The Section contains
provisions on injunctions, damages and other
remedies. Article 44 requires that the courts be
empowered to order injunctions, i.e. to order a
party to desist from infringements, including the
possibility to prevent imported infringing goods
from entering into domestic distribution
channels. Members are not obliged to provide that
authority where a person has acted in good faith.
Article 45 provides that the courts must be
empowered to order an infringer, at least if he
or she acted in bad faith, to pay the right
holder adequate damages. They must also be
authorized to order the infringer to pay the
right holder's expenses. These expenses may
include appropriate attorney's fees. In
appropriate cases, the courts may be authorized
to order recovery of profits and/or payment of
pre-established damages even where the infringer
acted in good faith.
In order to create an
effective deterrent to infringement, Article 46
requires that the judicial authorities must have
the authority to order infringing goods to be
disposed of outside the channels of commerce, or,
where constitutionally possible, destroyed.
Similarly, it must be possible to dispose of
materials and instruments predominantly used in
the production of the infringing goods. In
considering such requests, the courts must take
into account proportionality between the
seriousness of the infringement and the remedies
ordered as well as the interests of third
parties. In respect of counterfeit trademark
goods, it is clarified that the simple removal of
the trademark unlawfully affixed shall not be
sufficient, other than in exceptional cases, to
permit release of the goods into the channels of
commerce.
The judicial
authorities may be authorized to order the
infringer to inform the right holder of the
identity of third persons involved in the
production and distribution of the infringing
goods or services and of their channels of
distribution (Article 47). This option is aimed
at assisting the right holders to find the source
of infringing goods and to take appropriate
action against other persons in the distribution
channels. This provision must be applied in a way
that is in proportion to the seriousness of the
infringement.
The Section contains
certain safeguards against abuse of enforcement
procedures. Article 48 provides that the judicial
authorities must have the authority to order the
applicant who has abused enforcement procedures
to pay an adequate compensation to the defendant
who has been wrongfully enjoined or restrained to
cover both the injury suffered and expenses. Such
expenses may include appropriate attorney's fees.
Public authorities and officials are exempted
from liability to appropriate remedial measures
only where actions are taken or intended in good
faith in the course of the administration of that
law.
Article 49 provides
that, to the extent that any civil remedy can be
ordered as a result of administrative procedures
on the merits of a case, such procedures shall
conform to principles equivalent in substance to
those set forth in the Section.
Provisional measures
Article 41 requires
that enforcement procedures must permit effective
action against infringements and must include
expeditious remedies. As these judicial
procedures may take a fair amount of time, it is
necessary for the judicial authorities to be
empowered to provide provisional relief for the
right holder in order to stop an alleged
infringement immediately. The provisions on
provisional measures are contained in Article 50.
It requires each country to ensure that its
judicial authorities have the authority to order
prompt and effective provisional measures. Such
measures must be available in respect of any
intellectual property right. Provisional measures
have to be available in two situations. One is
where they are needed to prevent an infringement
from occurring, and to prevent infringing goods
from entering into the channels of commerce. This
includes preventing imported infringing goods
from being dispersed into domestic distribution
channels immediately after customs clearance. The
other situation is where such measures are needed
to preserve relevant evidence in regard to the
alleged infringement.
Effective use of
provisional measures may require that action be
taken without giving prior notice to the other
side. Therefore, the judicial authorities must
have the authority to adopt provisional measures inaudita
altera parte, i.e. without prior hearing of
the other side, where appropriate, in particular
where any delay is likely to cause irreparable
harm to the right holder, or where there is a
demonstrable risk of evidence being destroyed
(paragraph 2).
The courts may require
the applicant to provide any reasonably available
adequate evidence that the applicant is the right
holder and that the applicant's right is being
infringed or that such infringement is imminent
(paragraph 3). The applicant may also be required
to supply information necessary for the
identification of the goods (paragraph 5). Where
provisional measures have been adopted inaudita
altera parte, the parties affected must be
given notice, without delay after the execution
of the measures at the latest. The defendant has
a right to review with a view to deciding, within
a reasonable period after the notification of the
measures, whether these measures shall be
modified, revoked or confirmed (paragraph 4).
The provisions on
provisional measures contain certain safeguards
against abuse of such measures. The judicial
authority may require the applicant to provide a
security or equivalent assurance sufficient to
protect the defendant and to prevent abuse
(paragraph 3). Provisional measures shall, upon
request by the defendant, be revoked or otherwise
cease to have effect, if the applicant fails to
initiate proceedings leading to a decision on the
merits of the case within a reasonable period to
be determined by the judicial authority ordering
the measures. In the absence of such a
determination, this period may not exceed 20
working days or 31 calendar days, whichever is
the longer (paragraph 6). Where the provisional
measures are revoked or where they lapse due to
any act or omission by the applicant, or where it
is subsequently found that there has been no
infringement or threat of infringement of an
intellectual property right, the judicial
authorities shall have the authority to order the
applicant to provide the defendant appropriate
compensation for any injury caused by these
measures (paragraph 7).
The above principles
apply also to administrative procedures to the
extent that any provisional measure can be
ordered as a result of such procedures (paragraph
8).
Special
requirements related to border measures
The emphasis in the
enforcement part of the TRIPS Agreement is on
internal enforcement mechanisms, which, if
effective, would enable infringing activity to be
stopped at source, the point of production. Where
possible, this is both a more efficient way of
enforcing IPRs and less liable to give rise to
risks of discrimination against imports than
special border measures. However, the Agreement
recognizes that such enforcement at source will
not always be possible and that in any event not
all countries are Members of the TRIPS Agreement.
The Agreement therefore also recognizes the
importance of border enforcement procedures that
will enable right holders to obtain the
cooperation of customs administrations so as to
prevent the release of infringing imports into
free circulation. The special requirements
related to border measures are contained in
Section 4 of the enforcement part of the
Agreement. According to Article
51 of the Agreement, the goods which must be
subject to border enforcement procedures must
include at least counterfeit trademark and
pirated copyright goods that are being presented
for importation (see footnote 14 to that Article
for the precise definition of these terms). The
Article leaves flexibility to Member governments
on whether to include imports of goods which
involve other infringements of IPRs. Members are
also free to determine whether to apply these
procedures to parallel imports. This is confirmed
in footnote 13 to the Article, according to which
it is understood that there shall be no
obligation to apply such procedures to imports of
goods put on the market in another country by or
with the consent of the right holder. In
accordance with Article 60, Members may exclude
from the application of these procedures de minimis
imports, i.e. small quantities of goods of a
non-commercial nature contained in travellers'
personal luggage or sent in small consignments.
Article 51 leaves it to Members to decide whether
to apply corresponding procedures to the
suspension by customs authorities of infringing
goods destined for exportation from their
territories, or to goods in transit.
The basic mechanism
required by the Agreement is that each Member
must designate a "competent authority",
which could be administrative or judicial in
nature, to which applications by right holders
for customs action shall be lodged (Article 51).
The right holder lodging an application to the
competent authority shall be required to provide
adequate evidence of a prima facie
infringement of his IPR and to supply a
sufficiently detailed description of the goods to
make them readily recognizable by the customs
authorities. The competent authorities shall then
inform the applicant whether the application has
been accepted and, if so, for what period, and
give the necessary directions to customs officers
(Article 52). After this, it is the
responsibility of the applicant to initiate
proceedings leading to a decision on the merits
of the case. The Agreement requires a system to
be put in place under which action will be taken
on the basis of an application from a right
holder, but leaves it to Members to determine
whether they require competent authorities to act
upon their own initiative. Article 58 contains
certain additional provisions applicable to such ex
officio action.
The provisions on
border measures require the taking of what are
essentially provisional measures against imports
of infringing goods. Many of the same types of
safeguards against abuse as appear in Article 50
on provisional judicial measures are provided
for. The competent authority may require the
applicant to provide a security or equivalent
assurance sufficient to protect the defendant and
the competent authorities and to prevent abuse.
However, such security or equivalent assurance
may not be such as to unreasonably deter recourse
to these procedures (Article 53.1). The importer
and the applicant must be promptly notified of
the detention of goods (Article 54). If the right
holder fails to initiate proceedings leading to a
decision on the merits of a case within ten
working days, the goods shall normally be
released (Article 55). Where goods involve
the alleged infringement of industrial designs,
patents, layout-designs or undisclosed
information, the importer must be entitled to
obtain their release on the posting of a security
sufficient to protect the right holder from any
infringement, even if proceedings leading to a
decision on the merits have been initiated
(Article 53.2). Once judicial proceedings on the
merits of a case have been initiated, the
judicial authority may continue the suspension of
the release of goods in accordance with a
provisional judicial measure. In that case, the
provisions on provisional measures in Article 50
shall be applied. The applicant may be required
to pay appropriate compensation to persons whose
interests have been adversely affected by the
wrongful detention of goods or through detention
of goods released pursuant to the failure of the
applicant to initiate in time proceedings leading
to a decision on the merits of the case (Article
56).
The competent
authorities must be able to give the right holder
sufficient opportunity to have any goods detained
by the customs authorities inspected in order to
substantiate his or her claims. Where goods have
been found infringing as a result of a decision
on the merits, the Agreement leaves it to Members
whether to enable the right holder to be informed
of other persons in the distribution channel so
that appropriate action could also be taken
against them (Article 57).
In regard to remedies,
the competent authorities must have the power to
order the destruction or disposal outside the
channels of commerce of infringing goods in such
a manner as to avoid any harm to the right
holder. The principles contained in Article 46 on
civil remedies, such as the need for
proportionality, apply also to border measures.
In regard to counterfeit trademark goods, the
authorities may not allow the re-exportation of
the infringing goods in an unaltered state or
subject them to a different customs procedure,
other than in exceptional circumstances. These
remedies are without prejudice to other rights of
action open to the right holder, such as to
obtain damages through civil litigation, and are
also subject to the right of the defendant to
seek review by a judicial authority (Article 59).
Criminal procedures
The fifth and final
section in the enforcement chapter of the TRIPS
Agreement deals with criminal procedures.
According to Article 61, provision must be made
for these to be applied at least in cases of
wilful trademark counterfeiting or copyright
piracy on a commercial scale. The Agreement
leaves it to Members to decide whether to provide
for criminal procedures and penalties to be
applied in other cases of infringement of
intellectual property rights, in particular where
they are committed wilfully and on a commercial
scale.
Sanctions must include
imprisonment and/or monetary fines sufficient to
provide a deterrent, consistent with the level of
penalties applied for crimes of a corresponding
gravity. Criminal remedies in appropriate cases
must also include seizure, forfeiture and
destruction of the infringing goods and of
materials and instruments used to produce them.
Other provisions
Acquisition and
maintenance of intellectual property rights and
related inter partes
procedures
On the whole, the
Agreement does not deal in detail with procedural
questions concerning acquisition and maintenance
of intellectual property rights. Part IV of the
Agreement contains some general rules on these
matters, the purpose of which is to ensure that
unnecessary procedural difficulties in acquiring
or maintaining intellectual property rights are
not employed to impair the protection required by
the Agreement. According to paragraph 1 of
Article 62, Members may require, as a condition
of the acquisition or maintenance of rights
related to trademarks, geographical indications,
industrial designs, patents and layout-designs,
compliance with reasonable procedures and
formalities. Where the acquisition of an
intellectual property right is subject to the
right being granted or registered, the procedures
must permit the granting or registration of the
right within a reasonable period of time so as to
avoid unwarranted curtailment of the period of
protection (paragraph 2). Procedures concerning
the acquisition or maintenance of intellectual
property rights and, where a Member's law
provides for such procedures, administrative
revocation and inter partes
procedures such as opposition, revocation and
cancellation, must be governed by the general
principles concerning decisions and review set
out in paragraphs 2 and 3 of Article 41
of the Agreement (paragraph 4). Final
administrative decisions in such procedures must
generally be subject to review by a judicial or
quasi-judicial authority (paragraph 5).
Transitional
arrangements
The TRIPS
Agreement gives all WTO Members transitional
periods so that they can meet their obligations
under it. The transitional periods, which depend
on the level of development of the country
concerned, are contained in Articles 65 and 66.
Developed country
Members have had to comply with all of the
provisions of the TRIPS Agreement since 1 January
1996. However, all Members, even those availing
themselves of the longer transitional periods,
have had to comply with the national treatment
and MFN treatment obligation as of 1 January
1996.
For developing
countries, the general transitional period is
five years, i.e. until 1 January 2000.
A country whose economy is in transition, but
which is not a developing country, may
nonetheless delay application until the
year 2000, if it meets three tests:
- it
is in the process of transformation from a
centrally-planned into a market, free enterprise
economy;
- it
is undertaking structural reform of its
intellectual property system; and
- it
faces special problems in the preparation and
implementation of intellectual property laws and
regulations.
For those countries on
the United Nations list of least-developed
countries, the transitional period is eleven
years. The Agreement provides a possibility to
extend the transitional period upon duly
motivated request.
There are two
important substantive obligations that have been
effective from the entry into force of the TRIPS
Agreement on 1 January 1995. One is the so-called
"non-backsliding" clause in Article
65.5 which concerns changes made during the
transitional period, and the other the so-called
"mail-box" provision in Article 70.8
for filing patent applications for pharmaceutical
and agricultural chemical products during the
transitional period.
The
"non-backsliding" clause in Article
65.5 forbids countries from using the transition
period to reduce the level of protection of
intellectual property in a way which would result
in a lesser degree of consistency with the
requirements of the Agreement.
Special transition
rules apply in the situation where a developing
country does not provide product patent
protection in a given area of technology,
especially to pharmaceutical or agricultural
chemical inventions, on the general date of
application of the Agreement for that Member,
i.e. in the year 2000. According to
Article 65.4, such a developing country may delay
the application of the TRIPS obligations on
product patents to that area of technology for an
additional five years (i.e. to the
year 2005). However, the Agreement includes
additional transitional arrangements in the
situation where a country does not provide, as of
the date of entry into force of the WTO
Agreement, patent protection for pharmaceutical
and agricultural chemical products commensurate
with the TRIPS provisions. In accordance with the
"mail-box" provision contained in
Article 70.8, the country concerned must provide,
as from the date of entry into force of the WTO
Agreement, a means by which patent applications
for such inventions can be filed. These
applications will not need to be examined for
their patentability until the country starts
applying product patent protection in that area,
i.e. for a developing country, at the end of
the ten-year transition period. However, at that
time, the application must be examined by
reference to the prior art as it existed at the
time the application was made. If the application
is successful, product patent protection would
then have to be granted for the remainder of the
patent term counted from the filing date of the
application. If a product that has been the
subject of such a patent application obtains
marketing approval before the decision on the
grant of the patent is taken, there is an
obligation under Article 70.9 to grant exclusive
marketing rights for a period of up to five years
to tide over the gap. This is subject to a number
of safeguards to ensure that the product
concerned is a genuine invention: subsequent to
the entry into force of the WTO Agreement, a
patent application must have been filed, a patent
granted and marketing approval obtained in
another Member for the product in question.
Protection of
existing subject-matter
An important aspect of
the transition arrangements under the TRIPS
Agreement is the provisions relating to the
treatment of subject-matter already existing at
the time that a Member starts applying the
provisions of the Agreement. As provided in
Article 70.2, the rules of the TRIPS Agreement
generally apply to subject-matter existing on the
date of application of the Agreement for the
Member in question and which is protected in that
Member on the said date. In respect of copyright
and most related rights, there are additional
requirements. Articles 9.1, 14.6 and 70.2 of the
TRIPS Agreement oblige WTO Members to comply with
Article 18 of the Berne Convention, not only in
respect of the rights of authors but also in
respect of the rights of performers and producers
of phonograms in phonograms. Article 18 of the
Berne Convention as incorporated into the TRIPS
Agreement includes the so-called rule of
retroactivity, according to which the Agreement
applies to all works which have not yet fallen
into the public domain either in the country of
origin or the country where protection is claimed
through the expiry of the term of protection. The
provisions of Article 18 allow some transitional
flexibility where a country is, as a result,
taking subject-matter out of the public domain
and putting it under protection, in respect of
the interests of persons who have in good faith
already taken steps on the basis of the material
being in the public domain.
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