Intellectual Property Rights(IPR)

TRIPS/TRIMS
Submitted by
Madhumitha Udaykumar 30
S Vignesh 43
Sabarinathan S 45
PGDM A Group 20
Agenda
Introduction
History and Treaties
Types of IPR
Why do we need IPR?
TRIPS
TRIMS
Limitations of IPR
Current Issues
Implications for MNEs
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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.
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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/
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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

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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.
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Types of IPR
Common types of IPR
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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
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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/
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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)




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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.
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THE TRIPS
AGREEMENT
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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.
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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.


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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.



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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.


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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)

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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.


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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.

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Diff b/w TRIPS and Indian Patent Act

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THE TRIMS
AGREEMENT
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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
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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

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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
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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.
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Indias 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.
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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

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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.


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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


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Patent filings rebound in 2010
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Source: WIPO
Report 2011
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Source: WIPO Report 2011
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Source: WIPO Report 2011
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.

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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)




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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.
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Thank you!!!
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