RESTRICTEDWORLD TRADE
ORGANIZATIONIP/C/M/40
22 August 2003
(03-3290)
Council for Trade-Related Aspects
of Intellectual Property Rights
MINUTES OF MEETING
Held in the Centre William Rappard
on 4-5 June 2003
Chairman:  Ambassador Vanu Gopala Menon (Singapore)
The present document contains the record of the discussion which took place during the
TRIPS Council meeting held on 4-5 June 2003.
Subjects discussed     Page Nos
A. N OTIFICATIONS UNDER PROVISIONS OF THE AGREEMENT ........................................................2
B. F OLLOW -UP TO REVIEWS ALREADY UNDERTAKEN ..................................................................2
C. P ARAGRAPH 6 OF THE DOHA DECLARATION ON THE TRIPS AGREEMENT AND
PUBLIC HEALTH ..........................................................................................................................4
D. R EVIEW OF THE PROVISIONS OF ARTICLE 27.3(B)..................................................................13
E. R ELATIONSHIP BETWEEN THE TRIPS AGREEMENT AND THE CONVENTION ON
BIOLOGICAL DIVERSITY ...........................................................................................................13
F. P ROTECTION OF TRADITIONAL KNOWLEDGE AND FOLKLORE ................................................13
G. R EVIEW OF IMPLEMENTATION OF THE TRIPS AGREEMENT UNDER ARTICLE 71.1 .................27
H. N ON-VIOLATION AND SITUATION COMPLAINTS ......................................................................27
I. E LECTRONIC COMMERCE ..........................................................................................................35
J. R EVIEW OF THE APPLICATION OF THE PROVISIONS OF THE SECTION ON
GEOGRAPHICAL INDICATIONS UNDER ARTICLE 24.2...............................................................36
K. T ECHNICAL COOPERATION AND CAPACITY -BUILDING ............................................................37
L. I NFORMATION ON RELEVANT DEVELOPMENTS ELSEWHERE IN THE WTO.............................38
M. O BSERVER STATUS FOR INTERNATIONAL INTERGOVERNMENTAL ORGANIZATIONS ..............38
N. S PECIAL AND DIFFERENTIAL TREATMENT PROPOSALS REFERRED TO THE COUNCIL ............39
O. U PDATE TO THE ANNUAL REPORT TO THE GENERAL COUNCIL .............................................44
P. O THER BUSINESS ......................................................................................................................45IP/C/M/40
Page 2
A. NOTIFICATIONS UNDER PROVISIONS OF THE AGREEMENT
 (i) Notifications under Article 63.2
- Notifications from Members whose transitional periods under Article 65.2 or
65.3 expired on 1 January 2000 or acceded to the WTO after that date
1. The Chairman drew attention to the Secretariat's updated note reflecting the status of the
notifications received from these Members so far (JOB(03)/102).  The showed from which of the
Members in question notifications had been received by 26 May 2003.  Two newly acceded Members,
namely Armenia and the Former Yugoslav Republic of Macedonia had been added to the list.  Since
the Council's meeting in February 2003, the followin g notifications had been received:  Belize had
notified its new intellectual property laws and related regulations – the same laws had been notified in
the year 2000 in the form of pending bills;  Mauritius had notified its new laws on industrial propertyrights;  and Egypt had notified its unified law on the protection of intellectual property rights.  Since
the compilation of the updated note on 26 May 2003, India had notified its new rules on
semiconductor integrated circuits layout-designs, trademarks, and on geographical indications.  From
the 81 Members in question, there were now five who had not yet submitted any notification
concerning their implementing legislation, apart from the two newly acceded Members referred toabove, namely Papua New Guinea, Saint Kitts and Nevis, Saint Vincent and the Grenadines,
Swaziland, and the United Arab Emirates.  Notifications from a number of other Members were
incomplete.
2. The Chairman said that, as requested by the Council at its previous meeting, he had written to
those Members that had not been represented at that meeting and with unfulfilled notificationobligations under Article 63.2 of the Agreement.  Recalling that pursuant to Article 63.2 of the
Agreement the notifications of the laws and regulations in question were generally due as of
1 January 2000, he urged all Members with unfulfilled notification obligations to submit the
outstanding material without delay.
- Notifications from other Members and notifications of amendments of laws
notified earlier
3. The Chairman informed the Council that, since the previous meeting, the following updates to
earlier notifications of laws and regulations had been received:  Hong Kong, China had notified its
new laws and regulations on trademarks;  and Moldova had notified modifications to its industrial
property and plant variety laws.  These notifications would be available in the IP/N/1/- series of
documents.
B. FOLLOW -UP TO REVIEWS ALREADY UNDERTAKEN
4. The Chairman noted that, as requested by the Council at its meeting in February 2003, the
Secretariat had updated its informal note that listed all the outstanding material required to complete
the reviews that the Council had already undertaken (JOB(03)/101).  The table attached to the note
listed those Members whose reviews had been initiated at the Council's meetings in April, June and
November 2001, and March and June 2002 but had not yet been completed, and it identified all theoutstanding material.  In addition, the note also listed a number of Members whose reviews had
already been deleted from the Council's agenda, but to whom further questions had been posed.
5. The Chairman said that the note did not cover the reviews initiated most recently.  Therefore,
he first reverted to the follow-up to the normal review of China's TRIPS implementing legislation
which the Council had taken up at its meeting in September 2002 combined with the review under the
transitional review mechanism under China's Accession Protocol.  There was still one initial question,IP/C/M/40
Page 3
namely question 14 from Korea, to which a response had not yet been received.  In addition, further
follow-up questions had been posed to China in April 2003 by Japan (IP/C/W/362/Add.4).
6. The representative of China said that his delegation still needed some time to prepare
responses to the questions.
7. Turning to those reviews whose follow-up was sti ll pending, the Chairman noted that the table
attached to the Secretariat's note referred to above indicated that there were 19 Members whose
reviews had been initiated since April 2001 that had not yet been completed.  The table referred to
submissions, including both responses and foll ow-up questions, received by 26 May 2003.  As agreed
at the Council's previous meeting, the Secretariat had written to all of the delegations whose reviews
were still pending.
8. He said that Kenya and Cameroon had now provided responses to all of the questions posed
to them, and all of these responses had been circulated to Members prior to the meeting.  He proposedthat the reviews of the legislation of Kenya and Cameroon be deleted from the agenda, it being
understood that any delegation should feel free to revert to any matter stemming from these reviews at
any time.
9. The Council so agreed.
10. The Chairman said that there were still 17 Members whose reviews had been initiated
between April 2001 and June 2002 that had not ye t been completed, namely Brazil, Congo, Cuba,
Egypt, Fiji, Grenada, Mauritius, Moldova, Nigeria,  Pakistan, the Philippines, Qatar, Saint Kitts and
Nevis, Saint Vincent and the Grenadines, Suriname, Swaziland, and Zimbabwe.
11. He noted that responses to all outstanding questions had just been received from the
Permanent Mission of Brazil (subsequently circ ulated as document IP/C/W/303/Add.4) and the
Philippines (subsequently circulated as docum ent IP/C/W/272/Add.3).  A communication had been
received from Suriname providing information on the status of the preparation of its new legislation
on industrial property, and on copyright and relate d rights (IP/C/W/283/A dd.4).  Furthermore, he
recalled that, at the Council's meeting in September 2002, Canada, Switzerland and the United States
had requested Mauritius to respond to the questions they had posed to it on the basis of the newlegislation that was pending at that time, and noted that Mauritius had recently notified its new
industrial property legislation.
12. The representative of Cuba said that the new legislation on industrial designs and inventions
had not yet been adopted as the authority responsib le for it had been occupied with other matters of
high national priority.  She expected the legislation to be adopted fairly soon, after which her
delegation would notify it to the WTO and provide responses to the outstanding questions.
13. The representative of Egypt said that his dele gation would provide the Council with responses
to the outstanding questions as soon as possible and, in any case, before the Council's next meeting.
14. The representative of Nigeria said that his delegation would be able to provide responses to
the outstanding questions by the following week.
15. The representative of Pakistan said that his delegation would be able to respond to the one
outstanding question by the Council's next meeting.
16. The representative of Zimbabwe regretted to inform that his delegation was still in the process
of preparing the responses but hoped to provide them as soon as possible.IP/C/M/40
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17. The representative of Switzerland thanked Brazil and the Philippines for the responses that
they had provided to the questions posed by his delegation.  His delegation would examine them prior
the Council's next meeting and come back to them if necessary.
18. Speaking in relation to both item A and item B, the representative of the European
Communities expressed his concern about the lack of notifications by some Members and the delays
in responding to questions posed during reviews.   He foreshadowed his intervention under item C
concerning the implementation of the Doha Declaration on the TRIPS Agreement and Public Health,
and said that this was why he wanted to flag his concern about the lack of progress by some Members
in implementing the TRIPS Agreement.
19. The representative of Japan said that his delegation appreciated the Chinese Government's
effort to improve its intellectual property legisl ation consistently with the TRIPS Agreement and
expected it to continue this effort.  He hoped to receive responses to the follow-up question hisdelegation had posed as soon as possible.  He said that there might be some new legislation which had
not yet been notified to the Council, such as regulations on well-known marks.  For the sake of
transparency, it was important that any new legislation be notified to the TRIPS Council and reviewed
by all Members as soon as possible.
20. The representative of Canada thanked Brazil for its responses to the questions posed by his
delegation.  He shared the views expressed by the European Communities that it was very important
that Members take on the commitment to implemen t their TRIPS obligations.  It appeared that
progress on a number of issues on the Council's agenda depended on all Members having
implemented their obligations.
21. The Chairman said that the Council had made only relatively little progress in completing the
pending reviews.  He urged the 15 delegations who had not yet submitted their responses to all
outstanding questions to do so without delay so as  to allow the completion of the reviews at the
Council's next formal meeting scheduled for November 2003.
22. He noted that the Secretariat note also listed five Members, namely Argentina, Dominica,
Gabon, Ghana and Guyana, whose reviews had already been deleted from the Council's agenda on theunderstanding that any delegation should feel free to revert to any matter stemming from the reviews
at any time.  In this connection, certain questions had been raised with regard to the implementing
legislation of these countries.
23. The representative of Argentina said that responses to the question would be communicated as
soon as her delegation received them from the respective authorities.
24. The Chairman proposed that the Council request the Secretariat to update its note on pending
reviews before the next meeting.
25. The Council took note of the statements made and agreed  to proceed as suggested by the
Chairman and revert to the matter at its next meeting.
C. PARAGRAPH 6 O F THE DOHA DECLARATION ON THE TRIPS AGREEMENT AND PUBLIC
HEALTH
26. The Chairman recalled that, at its meeting on 20 December 2002, the General Council had
invited the TRIPS Council to resume work on this agenda item promptly at the beginning of January
2003 in order to resolve the outstanding issues in the text that his predecessor had circulated on
16 December 2002 (JOB(02)/217) and to report to the General Council in order to enable it to take a
decision implementing a solution to the problem identified in paragraph 6 of the Doha Declaration on
the TRIPS Agreement and Public Health (hereinafter "the Declaration")  at its first meeting in 2003.IP/C/M/40
Page 5
Upon his predecessor's report to the General Council at its meeting of 10 February 2003 on the status
of his consultations, the General Council had agreed to suspend discussions on the implementation of
paragraph 6 of the Declaration and, if necessary, to revert to this issue at a reconvened meeting.  At
the last TRIPS Council meeting of 18-19 February 2003, his predecessor had informed the Council
that, notwithstanding his consultations on the subject, he was not in a position to put forward anyfurther suggestions to bridge the remaining gap in the text of 16 December 2002.  His predecessor had
also informed the General Council that his furthe r consultations had not led to a result which the
TRIPS Council could forward to the General Council.
27. He continued that since then he had been in touch with many delegations on a bilateral basis
or in small groups in order to brief himself on their positions and concerns and to gauge the scope for
finding a way to resolve the outstanding problem.  He had been advised by many delegations that the
time was not ripe for more structured consultations.  Nevertheless, the delegations had stressed theirresolve to finding a multilateral solution prior to the Cancún Ministerial Conference.  He drew the
Council's attention to two new documents, one, a letter he had received from the Deputy Prime
Minister of Vanuatu, who had written in his capacity as the President in office of the African,
Caribbean and Pacific Group of States (ACP) Coun cil of Ministers (IP/C/W/401), and another, a
communication from the European Communities on the implementation of the Declaration(IP/C/W/402).  He suggested that the European Communities communication be considered under this
agenda item although it did not specifically concern the implementation of paragraph 6 of the
Declaration, but dealt more broadly with the implementation of the Declaration as a whole.
28. The representative of the European Communities expressed grave concern about the current
deadlock with respect to the implementation of paragraph 6 of the Declaration and said that the
membership could not escape the commitments it had made at Doha and that the issue needed to be
solved before Cancún.  In his view, the text of 16 December 2002 remained the best basis for a deal
because it was fair and balanced.  The crucial issue, however, was one of building confidence.  The
European Communities was willing to work with other Members with a view to finding a formula that
would restore the confidence among Members while leaving unaffected the scope of the Declarationand the scope of diseases covered.  He hoped that those countries that had previously made
commitments to resort to the mechanism only in the case of national emergency or other
circumstances of extreme urgency would live up to these commitments.  He assured them that, in the
view of the European Communities, this would not affect their ability to react to a sudden or
unexpected epidemic.
29. He welcomed the contribution from the ACP countries in IP/C/W/401 as it came from a group
of countries that urgently needed a solution to paragraph 6 and saw it as a clear signal to themembership that an agreement must be reached as soon as possible.  He said that his delegation
shared their views, particularly with regard to their commitment to the 16 December text.
30. He explained that the objective of the European Communities' proposal of 24 January 2003
(JOB(03)/9) was not to restrict the scope of the Declaration, but to preserve it while also introducing a
confidence-building mechanism that would allow all Members to endorse the 16 December text.  Theonly difference with that text would have been that, for those public health problems not appearing on
the list, the WHO could be called upon, in case of doubt, to give its opinion.  Therefore, the
intervention of the WHO would have been neither systematic nor binding and would not have
impacted upon each Member's sovereign right to determine its public health policies.
31. Referring to the European Communities communication in IP/C/W/402, he reiterated that the
Declaration was important and that it had to be made operational despite the ongoing problems in
endorsing a solution to the issue outlined in paragraph 6.  He said that, even without a solution to
paragraph 6, the Declaration provided a secure ground for developing and least-developed countries
to take measures in the field of intellectual property to address public health problems.  He noted that
though the Declaration had been adopted, its implementation at the domestic level by least-developedIP/C/M/40
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and developing countries was delayed due to structural problems, including the need to modify
existing intellectual property laws.  Implementati on also required the establishment of administrative
and judicial structures which did not exist in many of the countries concerned.  He said that his
concern was shared and expressed in the communicat ion from the ACP countries.  This concern was
also echoed in the Declaration on Intellectual Property Rights, Innovation and Public Health that hadbeen adopted by the World Health Assembly in May 2003, which urged countries "to consider
whenever necessary, adapting national legislation in order to use to the full the flexibilities contained
in the TRIPS Agreement".  He stressed that the key to an effective implementation of the Declaration
was technical assistance and, therefore, called on the main technical assistance providers for
developing and least-developed countries, be they WTO Members or multilateral organizations, to
fully integrate the Doha Declaration into their technical assistance programmes.  He noted that,
among multilateral organizations, WIPO and the WTO were the main providers of technicalassistance on intellectual property to developing and least-developed countries, as evidenced through
their "Joint Initiative" on technical assistance on intellectual property for least-developed countries.
He said that these programmes must fully and comp letely integrate the effects of the Declaration and
should be geared towards the specific needs and levels of development of the recipient countries.  He
urged technical assistance providers to work in close association with the WHO and referred toCommissioner Lamy's letter of 12 August 2001, reco mmending that WIPO and the WTO involve the
WHO in their technical cooperation programmes.
32. He went on to explain that the two issues of compulsory licences and parallel imports were
linked to the implementation of the Declaration.  On the issue of compulsory licences, he said that
procedures prescribed by the TRIPS Agreement must be complied with.  On the issue of exhaustionand parallel imports, he emphasised the need to establish necessary measures to avoid trade diversion
of tiered priced products.  He said that one of  the most important means of supplying low-priced
medicines to the poorest populations was through price reductions offered by manufacturers, be they
from the R&D based industry or the generic industry.  An essential condition for the implementation
of effective tiered-pricing policies by companies was the segmentation of markets to prevent lowpriced products from flowing back to high priced mark ets.  In this context, he said that countries that
applied an international exhaustion regime would have to make certain exceptions to that regime in so
far as low priced medicines were concerned.  He noted that, although the European Communities did
not have an international exhaustion regime, it had adopted a regulation on 26 May 2003 which
prevented pharmaceutical products sold to developing countries at reduced prices to be re-imported
into the European Communities.  This regulation provided an additional measure of protection and
applied to both medicines that were protected by intellectual property and others.  This was intendedto encourage companies to supply medicines at reduced prices and was an important contribution to a
global partnership to provide cheap yet sustainable supply of key medicines to the populations of poor
countries.  Explaining the regulation, he said that it defined "tiered prices" as prices which were, at the
maximum, 25% of the average price charged fo r the same product in OECD countries, or
alternatively, not more than 15% above the direct production cost of the product.  He said that theEuropean Communities was setting an example by adopting a practical measure to help poor countries
that were struggling with public health crises and urged other countries to follow suit.  He reminded
the membership that the 16 December text insisted on  the need for all countries to take measures to
prevent diversion.
33. He stressed the importance of regional cooperation in view of implementing the TRIPS
Agreement and the Declaration.  He explained that it was the view of his delegation that the
implementation of an effective compulsory licensing system would take the form of a regional
arrangement based on a common patent system.  In particular, the regional patent system, coupled
with a centralised system of regional compulsory licensing schemes, would be instrumental in
overcoming possible constraints stemming from the principle of territoriality and independence ofpatents.  A practical example of such a system was the African Intellectual Property Organization
(OAPI), where the regional patent system coul d be usefully complemented with a regional
compulsory licensing system for production and import of products to address public health problems.IP/C/M/40
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34. He then referred to a Round Table on Access to Medicines which had been hosted by
Commissioners Lamy and Busquin and was held in  Brussels on 28 April 2003.  President Prodi had
opened the conference by stressing the urgent need to prevent the thousands of unnecessary deaths by
paving the way for joint efforts to improve access to medicines, including finding a breakthrough to
the current deadlock on paragraph 6.  The Conference has followed the life-cycle of medicines bystarting with a research session chaired by Co mmissioner Busquin.  The main conclusion from this
session had been the need for true partnerships to be built between developed and developing
countries and also between public and private stakeholders.  The session had also concluded that the
European and Developing Countries Clinical Trials Partnership should become a model for global
coordination of research efforts targeting poverty-related diseases and examined how drugs were used
locally.  The idea of public-private partnerships raised and supported but such a partnership required a
comprehensive national drugs policy in the developing country in question.  The final session hadfocused on trade issues and chaired by Commissioner Lamy.  It had been noted that prices of some
drugs had fallen drastically during the last years, although volumes of imports to developing countries
had not increased.  Voluntary licensing for local production had been supported and an overall
commitment had been made to ensuring that more patients could be treated in the future.  There had
been strong support for a solution to be reached on paragraph 6 prior to the Cancún MinisterialConference.  Commissioner Lamy had pointed to th e fact that the major political problem was the
position of the United States, although Mr. Grant Aldonas, Under Secretary for International Trade
Administration of the United States, had stressed that the US position was to find a solution.  The
overall conclusion from the Round Table had been that it is was necessary to secure political will and
sustainable funding in order to improve access to medicines.
35. He concluded by confirming that his delegation was fully committed to the Declaration, and
that its commitment included fully integrating the Declaration into the EC trade policy, especially
with regard to technical assistance for the impl ementation of the TRIPS Agreement.  The European
Communities and their member States remained committed to the Global Fund to fight AIDS,
tuberculosis and malaria.  He reiterated the need for companies to engage in tiered pricing and for
governments to move towards a consensus on paragraph 6 before the Cancún Ministerial Conference.
36. The representative of Kenya said that his delegation was committed to finding a permanent,
binding and economically viable solution to the issue posed in paragraph 6 of the Declaration.  He
welcomed the paper by the European Communities a nd said that the issue of technical cooperation
was particularly crucial for the countries that lacked manufacturing capacity as well as for those that
had problems with implementing the TRIPS Agreement.  In response to the European Communities'
reference to the diversion of pharmaceuticals, he enquired whether diversion of drugs was likelywhere most diseases that were under discussion were not prevalent in the countries that had the
capacity and technology to produce medicines.  In hi s opinion, diversion was not an issue that needed
to be emphasized.  He stressed that countries had to make sure that medicines were affordable and
available where they were needed.  While tiered-pricing was one option, it should not be seen as the
only solution and his delegation was still hopeful of seeking a multilateral and permanent solution.He was also hopeful that the 16 December text would be agreeable to all delegations and warned that
postponing the problem rather that solving it would make the issue more complex.  He noted that, at
the last discussion on this matter, the world had not been faced with the problem of SARS and,
therefore, in light of this situation, an urgent solution was needed.
37. The representative of Cuba referred to the European Communities' point relating to the
freedom of Member countries to determine their own exhaustion regimes.  As an ACP country, Cuba
fully supported document IP/C/W/401, particularly the reference to the 16 December text which,
although far from perfect, was a good basis for a decision in the TRIPS Council.  He said that Cuba
was ready to continue to work toward any multilate ral solution that, in addition to being sustainable,
was transparent, safe and precise.  In conclusion, he reminded the Council that the WHO Assemblyhad recently agreed upon a resolution by consensus that an appropriate solution on the paragraph 6
issue was needed before the Cancún Ministerial Conference.IP/C/M/40
Page 8
38. The representative of Indonesia said that she supported the Chairman's approach of trying to
break the deadlock by holding consultations in small groups, provided these were transparent.  Her
delegation echoed the feeling of frustration reflected in the ACP countries' submission that, while
countries were so close to a multilateral solution, it had almost been six months since the TRIPS
Council had missed its deadline set by Ministers at Doha.  Her delegation had entered into good faithnegotiations on this issue and had moved considerably from its original position in the hope that a
quick decision would be possible.  However, as the 16 December text continued to be rejected by
some Members, she felt the need to explore other approaches to find a stable, transparent and
predictable multilateral solution.  In her view, such a solution might be based on an interpretation of
the TRIPS provisions without entering into the complex process of amending the TRIPS Agreement.
She said that it was important that the solution to be found ensured the timely access to the needed
medicines.
39. The representative of China believed that TRIPS and public health was a humanitarian issue
rather than a trade issue, although it was an integral part of the Doha Development Agenda (DDA).
He pointed out that developing country Members had attached great importance to the paragraph 6
negotiations and had made significant efforts at building a consensus.  For example, developing
countries had shown flexibility on the subject of safeguards to protect the interests of patent holders.Therefore, an early multilateral solution would further strengthen developing countries' confidence in
the new round and have a positive impact on the progress of the DDA.  He said that China believed
that the Declaration reflected a multilateral consensus and any unilateral actions moving away from it
would weaken Members' confidence in the multilatera l system.  He believed that, in order to conclude
these negotiations before Cancún, it was time for the few developed Members who had not joined theconsensus in 2002 to show flexibility on the disputed issue.
40. He agreed that in finding a multilateral solution under paragraph 6, especially on the issue of
scope of diseases, the integrity of the Declaration needed to be maintained.  There was uncertainty on
the possible diseases that might be said to cause a public health crisis.  The example of SARS was a
convincing example of this issue.  Since the begi nning of 2003, the outbreak of SARS in China and
other WTO Members had posed a threat to mankind and a challenge to the international community.
Since the Chinese Government had taken swift action, together with the concerted action by the
international community, the situation had improved si gnificantly.  He said that the threat posed by
SARS brought to the forefront the gravity of the public health issue and the necessity and urgency of
joint efforts at the multilateral level.  Therefore, his delegation believed that, on the scope of diseases
covered by the paragraph 6 solution, the solution should adhere to the text in paragraph 1(a) of the
Doha Declaration.
41. The representative of Peru supported those delegations that had expressed concern at the lack
of a solution to the paragraph 6 problem.  She said that, although the 16 December text did not satisfy
everybody, it was acceptable to the vast majority of Members and that changes to this text could
change the very delicate balance that had been achieved so far.
42. The representative of Brazil referred to the resolution that had been adopted in the WHO on
intellectual property rights, innovation and public health.  The draft resolution was tabled by many
developing countries, including Brazil, the Afri can Group and many countries from Asia and Latin
America.  The resolution urged member states to reaffirm that public health interests were paramount
in both pharmaceuticals and health policies.  It further urged member states to adopt national
legislation that used, to the fullest, the flexibilities contained in the TRIPS Agreement and also tocontinue their efforts to reaching a consensus on the paragraph 6 issue.  He said that the adoption by
consensus of this resolution in the WHO was a signal to the TRIPS Council of the great importance
attached by the international community to the relation between intellectual property and public
health.  He noted that it was a display by the international community of a willingness to deal with
public health problems faced by developing countries.  He added that his delegation fully shared thefeelings of frustration expressed by other Members regarding the lack of progress in discussions onIP/C/M/40
Page 9
the establishment of a permanent and multilateral so lution to the problems identified by paragraph 6
despite their active and constructive participation.  He reaffirmed the great importance attached by his
delegation to the search for a permanent, multi lateral solution to the problem identified by
paragraph 6.
43. The representative of the Czech Republic said that although a solution under paragraph 6 had
not been found, it did not undermine the Declaration as  it was an important step forward in addressing
public health problems worldwide.  She expressed appreciation for all the attempts that had been
made to break the deadlock that the membership had been facing since the end of 2002 and repeated
that she fully supported the text of 16 December 2002.  The text reflected a proper balance among all
interests involved as it ensured access to medicines for countries in need but did not undermine
research and development of new and progressive pharmaceuticals and prevented abuse of the system.
She supported efforts to finding a solution to unresolved problems before Cancún.  In line with theEuropean Communities communication in IP/C/W/402, she underlined that an effective
implementation of the Doha Declaration, even without its paragraph 6, would help developing and
least-developed countries use the safeguards and flexibility of the TRIPS Agreement in protecting
public health.  In this regard, technical assistance was an effective tool for developing and
least-developed countries in using their intellectual property systems in conformity with the DohaDeclaration.  She said that it would be useful to take into account expert analysis and capacities from
other international and regional organizations, namely from WIPO, the WHO and regional institutions
dealing with IPRs, and strengthen their participation in technical assistance on the implementation of
the  Declaration.
44. The representative of Jamaica referred to the ACP countries' and European Communities'
submissions and said that she agreed with both with  regard to the need for the paragraph 6 issue to be
resolved as soon as possible and shared the common sentiment expressed in the papers.  She regretted
that the TRIPS Council had been unable to meet its deadline given by Ministers to find an expeditious
solution to the problems faced by countries with limited or no manufacturing capacities in the
pharmaceutical sector and to report to the General Council before the end of 2002.  She said thatalthough her delegation was not satisfied with the 16 December text and had voiced concern in the
past over the text, it was the best possible compromise available and hoped that the text would be
preserved and the matter could be further discussed with a view to resolving the pending issue before
the next Ministerial Conference.
45. The representative of Hungary agreed with the ACP countries and others that the
16 December text was the only realistic basis for finding a multilateral solution before the next
Ministerial in Cancún.  He feared that waiting for too long could unravel the text and noted thatefforts were needed to build confidence, especially  within certain pharmaceutical companies, in order
to reach a consensus.  These efforts would have to protect the integrity of the Doha Declaration and
should not result in changes to the text.  He supported the underlying message of the EC document
IP/C/W/402 that the TRIPS Agreement should be implemented by all WTO Members in line with the
Declaration that had created a legally secure environment for the implementation of TRIPSobligations.  He agreed that technical assistance tailored to the needs of recipient countries should be
provided for all LDCs and developing countries, as well as Members in a process of economic
transformation that faced similar problems in implementing TRIPS obligations.  He shared the call by
the European Communities for technical assistance providers, especially multilateral organizations
dealing with intellectual property, to fully integrate the Declaration in their technical assistanceprogrammes.
46. The representative of Malaysia, speaking also on behalf of Thailand
, expressed concern that
the TRIPS Council's failure to meet the deadline in finding an expeditious solution to paragraph 6
issues did not augur well for the WTO.  She noted that the majority of developing country Members
had shown utmost flexibility in the work leading up to the consensus on the 16 December text, eventhough the text did not meet their requirements for a solution that was simple and ensured theIP/C/M/40
Page 10
effective use of compulsory licences.  The 16 December text had a number of onerous conditions that
were over and above those prescribed by the TRIPS Agreement in terms of the safeguards and other
conditions.  Nonetheless, the text retained some essential elements that were integral to the solution
and did strike a fair balance between intellectual property holders and public health objectives.  It also
addressed an anomaly where some Members were able to make use of  compulsory licences whileothers were not able to do so.
47. Her delegation was not, however, in a position to accept a solution that would further decrease
the effective use of  compulsory licences or which further diluted the flexibility of Members under the
TRIPS Agreement.  Her delegation thus maintained the need to continue to press for an expeditious
multilateral solution that would remain faithful to  the objectives and principles of the TRIPS
Agreement, the Declaration and in particular, to the instructions given by Ministers in paragraph 6.
She supported the European Communities' proposal on technical assistance to strengthen Members'abilities to use flexibilities provided by the TRIPS Agreement.  She echoed the request of the ACP
countries that the paragraph 6 issue be addressed before the Fifth Ministerial Conference in Cancún.
48. The representative of Canada pointed out that Canada had been actively engaged in the
process of finding a solution which would provide access to those in need while at the same time
preserve the value of intellectual property protection.  She shared the disappointment of otherMembers on the inertia in moving ahead with the issue.  She agreed with the Chinese delegate's
reference to SARS as a concrete example of a grave public health crisis.  She noted that this was a
reason for the need to maintain a balance in the TRIPS Agreement so that effective medicines could
continue to be developed for those in need.  She said that until a solution to paragraph 6 was reached,
her delegation would encourage Members to take needed measures to protect public health.  Sherecalled that her delegation along with others had announced a moratorium on dispute settlement
proceedings to assist Members with limited or no manufacturing capacity needing access to medicines
to treat a public health crisis such as AIDS, tuberculosis, malaria or other epidemics.  This statement
was not meant to be a replacement for a paragraph 6 solution but was simply meant to provide an
opportunity for all Members to issue compulsory licences.
49. The representative of Switzerland shared the ACP countries' disappointment that no
consensus on a solution had been reached for the paragraph 6 problem before the mandated deadline
of 2002 and also expressed concern on the impasse in the negotiations since then.  He said that his
delegation was committed to working constructively with the Chairman and other delegations to
overcome the impasse and find a consensus for a solution on the paragraph 6 problem on the basis of
the 16 December text.  He hoped that such a consensus could be achieved before the Ministerial
Conference in Cancún.
50. He referred to the EC submission and its reference to the important issue of technical
assistance to developing and least-developed countr ies so as to enable them to implement the TRIPS
Agreement and the Declaration in a balanced way.  This would lead to the protection of R&D through
intellectual property, on the one hand, and would give due consideration to public policy issues on the
other.  He joined the European Communities in it s request to the WTO and WIPO to incorporate these
aspects in their technical assistance.  He commended the European Communities on their recent
approval of legislation that encouraged pharmaceutical companies to sell pharmaceuticals needed for
the fight against AIDS, tuberculosis and malaria to poor countries at heavily reduced prices and which
at that same time aimed to prevent the re-importation of these low-priced medicines back into the EC
market.  Such safeguard measures were the key to ensuring that discounted pharmaceuticals actuallyreached their country of destination and the people in need of them and were not diverted by traders
trying to realize lucrative arbitrage opportunities for commercial benefit.  It was for this reason that
Switzerland advocated safeguard measures in the paragraph 6 discussions.  He also welcomed the
announcement of the United States and others at the G8 meeting to donate substantial funds for the
fight against AIDS in Africa and the Caribbean countries.  All these were significant measures andshowed a commitment to improve the health situation in poor developing countries and least-IP/C/M/40
Page 11
developed countries.  He stressed that these efforts did not discharge the TRIPS Council from finding
a consensus solution to the paragraph 6 issue in accordance with the mandate given by the Ministers
at Doha.
51. The representative of Nigeria expressed his deep concern about the current impasse and the
inability of Members to come up with a solution as mandated by the end of 2002.  He hoped that the
impasse would be overcome and that a solution could be found before Cancún.
52. The representative of the Philippines commended the efforts of the Chairman to undertake
consultations on a bilateral basis and in a small group format and said that, despite of these efforts, the
membership had been unable to agree on a solution that was truly workable and feasible.  The
Philippines was mindful of the value that most Members attached to the 16 December text but, as a
developing country that had stood outside the co nsensus since November 2002, it remained open to
the possibility that a genuine solution could be found outside the parameters of this text.  This opinionwas buttressed by experience of some developing countries, including the Philippines, who had been
told in bilateral settings that, on the basis of the 16 December text, the Philippines had some
manufacturing capacity that would disqualify it from availing itself of the proposed solution.
53. He noted that an alternative approach to the one in the 16 December text could take time but it
might lead to a more workable and feasible solution.  He regretted that, by the time a solution wasreached, many people would have died  of HIV/AIDS and other diseases in developing countries.  One
of the conclusions of a conference held in Marseilles and dealing with economic issues related to
AIDS and access to medicines had been to have a truly workable and feasible solution under
paragraph 6.  He reiterated his delegation's belief that, if a Member felt the need to issue a compulsory
licence to address a public health problem, the TRIPS Agreement and the Declaration alreadyprovided sufficient flexibility for it to issue such a licence even without the benefit of the solution that
was being negotiated under paragraph 6.  He took note of the reference in the EC paper against trade
diversion of tiered-priced products and said that it was sufficient if border measures were undertaken
only by exporting countries without corresponding obligations on the importing countries to prevent
trade diversion.  Given the territorial nature of IPRs, an obligation could not be imposed on importingMembers.  He wondered if a similar level of trus t-building could not be established in this context.
54. The representative of Japan commended the Chairman on his efforts to consult with
delegations.  He reiterated the importance of the issue under paragraph 6 and the importance of
technical assistance, which had been raised and noted at the recent G8 meeting.  He expressed the
commitment of his delegation to finding a multilateral and expeditious solution before Cancún by
building confidence among all parties.
55. The representative of Australia hoped to see the paragraph 6 issue resolved as soon as
possible.  He believed that the 16 December text was the most useful basis on which a solution could
be found and his delegation was committed to working at finding an acceptable outcome.  He
expressed his awareness of the importance that countries in the Pacific region placed on the public
health issue as was evident in the ACP countries' paper.  He supported the European Communities'
comment on technical assistance to least-developed countries by establishing practices and proceduresto give effect to the  Declaration.  He brought to the attention of the Council the Australian
Government's standing offer to countries in the Asia-Pacific region to provide support to draft
legislation to take advantage of the flexibilities in the TRIPS Agreement.  He said that this programme
was part of Australia's global HIV/AIDS initiative.
56. The representative of Korea expressed his appreciation for the written submissions from the
European Communities and the ACP countries.  He shared their disappointment and frustration at the
continued failure to reach a consensus on the paragraph 6 issue.  Like others, Korea remained
committed to establishing a multilateral mechanism on an expeditious basis and recognized that there
was one remaining concern that prevented a consensus decision.  He hoped that the membershipIP/C/M/40
Page 12
would be able to address the concern effectively with flexibility and creativity so that a multilateral
solution could be reached before the Cancún Ministerial Conference.
57. The representative of the United States expressed his appreciation for the written submissions
from the ACP countries and the European Communities.  He said that the United States continued to
work with others to find a multilateral solution to the issue of the TRIPS Agreement and public healthbefore the Cancún Ministerial Conference.  He said that the United States was working to restore trust
between Members that would benefit from the solution as well as Members who were producers of
innovative medicines.  He added that, while the United States was working with others in order to find
a multilateral solution, it could not be said that a consensus had been reached.
58. The representative of the European Communities, addressing the concern of one delegation
about over-emphasis on trade diversion noted that in 2002 a serious case of trade diversion had taken
place in tiered-priced medicines exported from the European Communities to developing countriesand then back into the European Communities and that this had recurred about a month back.  He
agreed that such diversion was particularly likely in the case of medicines that were intended to fight
HIV/AIDS rather than other communicable diseases.  He said that his delegation was convinced that,
in order to encourage pharmaceutical companies to really engage in exporting at tiered prices,
Members had to take measures so that these products would be barred from coming back to theEuropean Communities.  He said that the European Communities had taken measures to protect its
exporters at its own borders from reimportation but hoped that countries of destination would also
take measures to ensure that  once the product was imported into their territory it would stay there.
He clarified that, under the European Communities' regulation, adopted by the Council of Ministers
on 26 May 2003 and available on their website, both medicines protected by intellectual propertyrights and other medicines were included.
59. Referring to the many statements made regarding SARS, he noted that the proposal on the
table since December 2002 remained an appropriate solution as it made it possible for Members to
call upon the system under paragraph 6 to address future problems.  He clarified that a solution to
paragraph 6 was not part of the single undertaking.  He stressed that Commissioner Lamy had offereda moratorium earlier in the year as a temporary solution and that the view of his delegation was that a
moratorium was not the final solution. He underlined the need to find a multilateral and definitive
solution along the lines of the 16 December text.  He hoped that some operational conclusion would
be drawn from the European Communities' communication with regard to the issue of technical
cooperation with other international organizations.
60. The representative of the Philippines agreed with the European Communities that the
paragraph 6 issue was not part of the DDA in the sense that it could not be the subject of trade-offs
with other negotiating issues in the context of th e broader round of negotiations launched in Doha.
However, on the issue of alternative approaches, he pointed out that so long as there was no consensus
on a paragraph 6 solution on the basis of the 16 December text, one approach could also be based on
the TRIPS Agreement and the Declaration as both allowed sufficient flexibility for Members to issue
compulsory licences.
61. The representative of WIPO said that, with respect to technical assistance on TRIPS and
public health, WIPO had been including this subject in all of its joint activities held with the WTO
and also in its own activities and would continue  to do so.  She said that WIPO had held two
workshops for least-developed countries which included this subject and had invited the WHO to
participate along with the WTO.  There had been also other regional and national workshopsconducted with the WTO for developing countries that had included this subject.
62. The representative of Argentina voiced her concern at the lack of consensus at reaching a
solution that would be practicable and feasible in practice.  Her delegation had taken a constructive
part in the negotiations throughout the last year and was also committed to future consultations on theIP/C/M/40
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issue.  Referring to the subject of alternative appr oaches, she said that other approaches or ideas to
find a solution would be welcome.  She was also k een to see that dialogue or discussion evolved in
terms of safeguards.  She welcomed the European Communities' paper that highlighted the technical
assistance aspect and  reaffirmed the right of Members to issue compulsory licences and to determine
the areas in which such licences could be granted.
63. The representative of Morocco, speaking on behalf of the African Group , said that the Group
had not had enough time to study the submissions by the European Communities and the ACP
countries as preliminary comments, he said that the African Group shared a number of ideas put
forward in both communications and had supported most of these ideas during the negotiations on a
solution to the paragraph 6 problem before and after December 2002.  The aspects of the European
Communities' communication regarding technical assistance and regional cooperation and the
effective implementation of the Declaration were posit ive elements that needed to be examined in the
light of the results that were achieved by the end of 2002.
64. He said that the African Group reaffirmed its endorsement of the 16 December text which
continued to enjoy almost full consensus as the permanent multilateral legal solution.  It was
convinced that any further discussion of its content would prove endless, without affording any real
guarantee of a positive and unifying solution.  It was to be recalled that all African Membersmaintained small delegations and had made consid erable sacrifices in this regard without even
achieving the much-awaited solution.  He once again emphasized the importance and urgency of
resolving this issue for the governments and peoples of Africa.  He welcomed the statements made in
the Council and in other international or regional fo ra by Members with regard to the need to reach a
multilateral solution in this area before the Cancún Ministerial Conference.
65. The Chairman expressed his intention to remain in close contact with delegations with a view
to resuming consultations as soon as developments showed signs of renewed consultations being
useful.  He said that he would continue to talk to delegations bilaterally, in small groups, as well as in
big groups.  He also urged delegations to continue to dialogue with each other so that a solution could
be found based on the 16 December text.  He hoped that a solution could be found before the CancúnMinisterial Conference and preferably in time for the next General Council meeting scheduled for
24 July.  He asked delegations to be ready to be called back, at short notice, for a special meeting of
the TRIPS Council in the event that progress  could be achieved in the coming weeks.
66. The Council took note of the statements.
D. REVIEW OF THE PROVISIONS OF ARTICLE 27.3(B)
E. RELATIONSHIP BETWEEN THE TRIPS AGREEMENT AND THE CONVENTION ON BIOLOGICAL
DIVERSITY
F. PROTECTION OF TRADITIONAL KNOWLEDGE AND FOLKLORE
67. The Chairman said that the Council had partially overlapping mandates to work on three
agenda items, namely the "Review of the provisions of Article 27.3(b)", "Relationship between the
TRIPS Agreement and the Convention on Biological Diversity" and "Protection of Traditional
Knowledge and Folklore".  The respective mandates were based on paragraph 19 of the DohaMinisterial Declaration and the built-in agenda of the TRIPS Agreement, as well as paragraph 12(b)
of the Doha Ministerial Declaration.  Given the action under way in the context of the Trade
Negotiations Committee on outstanding TRIPS implementation issues, he suggested that the Council's
examination of these three matters not include consideration of outstanding implementation issues
relating to them.IP/C/M/40
Page 14
68. Since its meeting in February 2003, the Council had received three new communications.
The first communication had been received from Sw itzerland expressing its views on these three
agenda items (IP/C/W/400).  The second communication had been received from the Permanent
Mission of India on behalf of Bolivia, Brazil, C uba, Ecuador, India, Peru, Thailand and Venezuela,
which concerned the relationship between the TRIPS Agreement and the CBD and the protection oftraditional knowledge (IP/C/W/403).  The third communication had been received from the
Permanent Mission of Morocco on behalf of the African Group, which suggested ways of taking
forward the review of Article 27.3(b) (IP/C/W/404).
69. The representative of Switzerland said that the Swiss communication was to be seen as a
contribution in accordance with the instructions Ministers had given to the TRIPS Council in
paragraph 19 of the Doha Declaration, namely that the Council should, in pursuing its work
programme including the review of Article 27.3(b), examine, inter alia , the relationship between the
TRIPS Agreement and the CBD, the protection of traditional knowledge and folklore, and other
relevant new developments raised by Members pursuant to Article 71.1.  He said that the core part of
the communication was the proposals which Switzerland had submitted to the WIPO Working Group
on Reform of the Patent Cooperation Treaty (PCT) in May 2003 on the declaration of the source of
genetic resources and traditional knowledge in patent applicants (WIPO Document PCT/R/WG/4/13).He requested the Secretariat to circulate the proposals to WTO Members as an annex to its
communication.
1  He said that the other elements of the communication complemented Switzerland's
earlier communication circulated in document IP/C /W/284 regarding the review of Article 27.3(b).
70. With regard to the issues addressed in the communication, he said that, taking a fair and
balanced approach, Switzerland supported effective patent protection of biotechnological innovationsand considered that the current wording of Article 27.3(b) provided a balance that took into account
the interests and needs of all WTO Members.  Such a fair and balanced approach necessitated
effective, efficient, practical and timely solutions  to the issues arising in the context of access to
genetic resources and traditional knowledge and the fair and equitable benefit-sharing arising out of
their utilization.  Switzerland had been an active and constructive partner in the discussions on theseissues in several international fora, including the CBD, the Food and Agriculture Organization, the
WIPO Intergovernmental Committee on Intellectual Property and Genetic Resources, Traditional
Knowledge and Folklore (IGC), and the TRIPS Counc il.  Various approaches were being discussed,
including the realization of measures that increased transparency in the context of access and benefit-
sharing, in particular with regard to the obligations  of the user of genetic resources and/or traditional
knowledge.
71. In the Working Group on Reform of the PCT, Switzerland had proposed to amend the
regulations under the PCT to explicitly enable contracting parties to require patent applicants whose
inventions were directly based on genetic resources or traditional knowledge to declare the source of
such resources and/or traditional knowledge in inte rnational patent applications.  Applicants had the
possibility of satisfying this requirement at the time of filing an international patent application or
later during the international phase.  In case an international patent application did not contain therequired declaration, national laws might foresee that, in the national phase, the application was not
processed any further until the patent applicant had furnished the required declaration.  By reference,
the proposed amendment to the PCT would also apply to the Patent Law Treaty (PLT).  Accordingly,
the contracting parties to the PLT would be able to require in their national patent laws that patent
applicants declare the source of genetic resources and/or traditional knowledge in national patentapplications.  The validity of a granted patent would be affected if the lack of or incorrect declaration
of the source was due to "fraudulent intention."
72. He said that the proposed measures did not require modifications of the TRIPS Agreement
and were further evidence of the flexibility that  the TRIPS Agreement provided for.  The proposals
                                                     
1 Subsequently circulated as an annex to document IP/C/W/400/Rev.1.IP/C/M/40
Page 15
were also intended to enhance the cooperation between the competent international fora and the
mutual supportiveness of the relevant international agreements.  The proposed declaration of the
source of genetic resources and traditional knowledge in patent applications would allow countries
that were parties to a contract on access and benefit-sharing to verify whether the other contracting
party was complying with its obligations arising under that contract.  These transparency measureswould not only assist and simplify the enforcemen t of these obligations, but would also allow the
verification of whether prior informed consent of the country providing the genetic resource had been
obtained and whether provisions had been made for fair and equitable benefit-sharing.
73. Turing to the protection of traditional knowledge, he said that WIPO's IGC was the foremost
international forum to deal with this subject.  The TRIPS Council's work on this issue should benefit
from and, therefore, draw upon the work being carried out by the IGC in order to avoid the
duplication of efforts and outcomes.  He said that th e two fundamental issues should be clarified at the
outset:  namely the establishment of, at least, a working definition of the term "traditional
knowledge," and determination of the objectives of its protection.
74. Introducing the joint communication by the African Group (IP/C/W/404), the representative
of Zimbabwe said that the communication aimed to assist in finalising the longstanding issues relating
to the review of Article 27.3(b), the relationship between the TRIPS Agreement and the CBD and the
protection of traditional knowledge and folklore.  This communication indicated the solutions that
needed to be found, set out the possible areas of agreement on the issues that had arisen, and provided
suggestions on how to resolve the issues on which Members had not been able to reach a common
understanding.
75. He said that the African Group reiterated its conviction that patents on life forms were
unethical and that the TRIPS Agreement should prohibit them.  The Group proposed that
Article 27.3(b) be revised to prohibit patents on plants, animals, micro-organisms, essentially
biological processes, and non-biol ogical and microbiological processes for the production of plants or
animals.
76. As regards the relationship between the TRIPS Agreement and the CBD, he said that the
African Group believed that the debate must go beyond the purely legal context and substantively deal
with the crux of the issues raised within the framework of the review of Article 27.3(b).  He said that
the TRIPS Agreement did not provide adequate and equitable means to prevent the grant of patents,
mainly in developed country Members, that had resulted in the misappropriation of genetic resources
and traditional knowledge taken from developing country Members.  He further said that, although
the CBD had important provisions in this respect,  the TRIPS Council should address the issue on its
own merits and find appropriate solutions.  The rights should protect genetic resources and traditionalknowledge from misappropriation through the requirements for equity toward the custodians of
genetic resources and traditional knowledge.  The obligations should require every Member to
prohibit and take measures to prevent the misappropriation of genetic resources and traditional
knowledge.  This should be done through requirements in Article 29 of the TRIPS Agreement for
equity, the disclosure of source of genetic resources and traditional knowledge involved in theclaimed invention, and the demonstration of compliance with the applicable domestic procedures in
the Member where the genetic resource and traditional knowledge had originated.  These
requirements would be useful in preventing or minimising the repetition or even the increase of cases
of misappropriation of genetic resources and traditional knowledge.
77. He said that, although the African Group believed that access contracts could be useful in
regulating the activities of researchers and other gatherers, their utility was only within the countries
themselves in accordance with their domestic laws.  Effective international mechanisms were needed
to require every Member individually and collectively, through enforceable international obligations,
to prohibit and prevent the misappropriation of genetic resources.IP/C/M/40
Page 16
78. The ongoing work in the IGC could not be a reason for delaying or putting off the work in the
WTO.  In support of this view, he said, first,  that any conclusions reached in WIPO did not
automatically become applicable in the WTO and th at the WTO had to start its own processes afresh.
He noted that the work in other international organizations, particularly in the CBD and the
International Treaty on Plant Genetic Resources for Food and Agriculture (ITPGRFA), thoughrelevant, had not automatically been included into the WTO.  Second, the African Group believed that
the work in WIPO on genetic resources and traditional knowledge had proceeded slowly.  Therefore,
it would not be appropriate to defer action, which was mandated under the review of Article 27.3(b)
and had a specific time frame, until WIPO had completed its work.  In addition, he said that an
international instrument to protect traditional knowledge in WIPO was still far from realisable while
the problem of misappropriation of genetic resources and traditional knowledge continued unabated.
The WTO must, therefore, on its part, find measures that were in line with its unique way offunctioning, particularly in regard to the manner in which Members' rights and obligations were spelt
out and the breach of obligations was addressed.  He pointed out that the WTO agreements, as a
single undertaking, provided for compulsory obligations on Members which were enforceable in
accordance with the DSU.  A solution to the concer ns relating to patents that resulted in the
misappropriation of genetic resources and traditional knowledge was obligations that wereenforceable within the WTO framework.  Against this background, the African Group proposed that
the TRIPS Council consider adopting the Decision on Traditional Knowledge which was contained in
an annex to document IP/C/W/404.
79. He said that the African Group wished that Members would confirm, and lock in, by way of a
decision, a common understanding in the following areas:  first, Members had the right and thefreedom to determine and adopt appropriate regime s in satisfying the requirement to protect plant
varieties by an effective sui generis  system.  Regardless of what sui generis  system was adopted for
protecting plant varieties, non-commercial use of plant varieties and the system of saving, exchanging
and selling seed among farmers were rights and exceptions that should be ensured as a matter of
important public policy to, among other things, ensure food security and preserve the integrity of ruralcommunities.  Second, both the TRIPS Agreement and the CBD as well as the ITPGRFA should be
implemented in a mutually supportive and consistent manner.  In this regard, Members retained the
right to require, within their domestic laws, the disclosure of the source of any biological materials
that constituted some input in the inventions claimed, and of evidence of benefit sharing.
80. In conclusion, he said that the African Group was keen to take the process forward in a
constructive manner and to finalize the review in a manner that reflected a good overall balance for all
Members.  He urged all delegations to positively re spond to the instructions to the Council from the
Ministerial Conference as contained in paragraphs 12 and 19 of the Doha Declaration.
81. The representative of India, introducing the submission by Brazil, Bolivia, Cuba, Ecuador,
India, Peru, Thailand and Venezuela, said that the submission was a follow-up to the one made by a
group of developing countries (IP/C/W/356) under th e mandate contained in paragraphs 12 and 19 of
the Doha Declaration.  He indicated that the purpose of the submission was to highlight and
strengthen the principal arguments for inserting a provision in the TRIPS Agreement that would
mandate that patent applicants for inventions that used biological resources and traditional knowledge
disclose the source of origin of such resource s and knowledge, provide evidence that they have
obtained the necessary prior informed consent, and provide evidence that they have complied with
national laws on benefit-sharing.  He believed that such a provision in the TRIPS Agreement wascritical for ensuring that the TRIPS Agreement and the CBD were implemented in a mutually
supportive manner.
82. He said that the submission argued that disclosure of origin of genetic resources and
associated traditional knowledge and evidence of prior informed consent and benefit sharing would,
first, prevent bio-piracy and misappropriation;  second, ensure the credibility of patent systems byenabling patent offices to ascertain more effectively the inventive step claimed in a particular patentIP/C/M/40
Page 17
application;  third, enhance the ability of countries to track patents granted without adequate prior art
appreciation on the existing biological resources and knowledge, and without involving any inventive
step;  fourth, improve compliance with national laws on prior informed consent and fair and equitable
benefit-sharing;  and finally, ensure the principle of equity, according to which a person should not be
able to benefit from exploiting patents based on genetic resources or associated traditional knowledgeacquired in contravention of any national legislation governing the access to the materials.  The
submission further argued that the proposed modi fication to the TRIPS Agreement would not violate
the principle of non-discrimination as to the field of technology.  The inherent difference in patent
applications using biological resources and associated traditional knowledge mandated additional
conditions on patent applicants to enable better assessment of such applications.  Placing the onus of
disclosure of the origin of resources, evidence of  prior informed consent and benefit-sharing on patent
applicants was a reasonable procedure based on the knowledge readily available to the applicant.Such a requirement would not amount to an unnecessary burden on either patent applicants or patent
offices.  National laws on access and benefit-sharing, bilateral contracts and databases on traditional
knowledge were all necessary for addressing the issue of misappropriation of biological resources and
associated traditional knowledge and bio-piracy.  However, in the absence of concrete amendment to
the patent regime, these developments would be inadequate in dealing with the misappropriation ofbiological resources and associated traditional knowle dge.  Leaving the consequences of disclosure of
origin of genetic resources, evidence of prior in formed consent and benefit-sharing outside the realm
of patent laws would render these requirements ineffective.  There should therefore be provisions in
patent laws to ensure that these requirements were not reduced to a mere formality.
83. Referring to the African Group's paper, he said that his delegation had noticed some
similarities in the approaches in documents IP/C/W/404 and 403.  Finally, he said that agenda items
D, E and F had a double mandate under paragraphs 12 and 19 of the Doha Declaration and that the
deadline for addressing these outstanding implementation issues had passed without any
recommendation.  It was therefore incumbent on the TRIPS Council to treat these matters with great
urgency so as to arrive at a suitable recommendation at the earliest opportunity.
84. The representative of Peru said that the TRIPS Council had a specific mandate under the
Doha Ministerial Declaration to examine the relationship between the TRIPS Agreement and the CBD
and to clarify the compatibility between the two agreements.  She indicated that Article 15 of the
CBD clearly stipulated that parties should adopt measures necessary to ensure equitable benefit
sharing and prior informed consent.  Many Members had incorporated this provision into their
national and/or regional legislation.  She illustrated that the Common Regime on Access to Genetic
Resources (Decision 391) and the Common Industrial Property Regime (Decision 486) of the AndeanCommunity provided that patents based on genetic resources and/or traditional knowledge were only
granted after the presentation of a contract on access to genetic resources or after authorization to use
traditional knowledge.  However, legislation at national and regional level was not sufficient to
prevent misappropriation which mainly occurred in countries that did not have such legislation.
Therefore, it was essential to include in the TRIPS Agreement a provision on the disclosure of originof genetic resources, equitable benefits sharing and prior informed consent.  These requirements were
no more difficult to comply with than any other usual requirements for the grant of patents.
85. With respect to bilateral contracts, she said that, although they provided certain protection,
they lacked the necessary legal security since they were voluntary.  In addition, there was a need to
ensure that contracts were equitable and beneficial to both parties.  However, it was difficult for mostindigenous communities since they did not have the proper legal training to negotiate such contracts.
Consequently, there was a need for provisions at the multilateral level that preserved the legitimate
rights of owners of genetic resources and tradi tional knowledge.  She said that the proposal for
defensive protection contained in document IP/C/W/403 was only a first step, which should be
supplemented by proposals on positive protection, i.e. a sui generis  multilateral system for the
protection of traditional knowledge.IP/C/M/40
Page 18
86. The representative of Norway reiterated that a provision could be inserted into the TRIPS
Agreement, which would either require or enable Members to oblige patent applicants to disclose the
origin of biological materials.  He underlined that, from a legal point of view, nothing in the TRIPS
Agreement prevented Members from requiring patent ap plicants to disclose such origin, provided that
a failure to disclose the origin would not in itself result in the rejection of a patent.
87. He informed the Council that, in May 2003, the Norwegian Government had put to
Parliament a set of proposals for amending the Norwegian patent law relating to biotechnological
inventions.  One of the proposals was to require patent applicants to disclose the country where they
had received the biological materials and, if they differed, the country of origin.  This obligation was
required of all national patent applications, but not of international applications.  Under that proposal,
the applicant must state whether the country of origin had consented to the extraction of the material,
provided that such consent was necessary under the national law of the providing country.  If therelevant information was unknown to the applican t, he could say so.  Non-compliance with this
obligation would neither affect the processing of pa tent application nor the validity of a patent.  An
intentional submission of false information might be punishable under the Norwegian penal code.  He
said that the main purpose of that proposal was to facilitate interested parties to verify whether the
biological material was collected in accordance with the provisions of the CBD, particularly therequirements on equitable benefit-sharing and prior informed consent.  It could also facilitate a patent
office's examination of patentability of the invention, particularly the novelty aspect.
88. Responding to the question about how a disclosure provision in a national law could
contribute to the promotion of the objectives of the CBD if a patent application could not be rejected
on the sole ground that the applicant did not disclose the required information, he said that, by merelyrequiring such information, more attention would be focused on national policy objectives to further
the principles of the CBD.  In this respect, it was particularly important that private companies
observed any relevant national provisions of those countries which supplied biological materials. He
further indicated that Norway expected most patent applicants to comply with this requirement, even
though non-compliance with the disclosure obligation would not affect the grant of a patent.  Since allpatent applications would become public, most applicants would find that it was in their own interest
to demonstrate that they had fulfilled their legal obligations, both under the Norwegian patent law and
under other  national laws.
89. Referring to the Swiss communication, he said that the Norwegian proposal to Parliament did
not require the disclosure in international applications because of the wording of the PCT.  His
delegation, therefore, supported the Swiss proposal to amend the PCT so as to explicitly enable
Contracting Parties to require patent applicants to declare the origin of genetic resources andtraditional knowledge.
90. The representative of Brazil said that, as a co-sponsor of document IP/C/W/403, his
delegation fully aligned itself with the statements made by India and Peru.  He believed that it was
important to find an adequate and effective international solution to effectively deal with bio-piracy
and misappropriation of traditional knowledge.  He said that this issue should be dealt with as a matterof urgency by WTO Members under the double mandate provided by paragraphs 12 and 19 of the
Doha Declaration.
91. Referring to the African Group's paper, he said that there were a great deal of similar
positions and concerns between the African Group and Brazil.  As to the Swiss paper, although his
delegation could not agree with everything in the paper, he felt that it was an important positive stepforward.
92. The representative of the European Communities said that he was in favour of dealing with all
the implementation issues at the TNC level, without prejudice to the interpretation of paragraph 12 of
the Doha Declaration.  With respect to the CBD, he said that several proposals had been made on theIP/C/M/40
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disclosure of origin of genetic resources and traditional knowledge in patent applications and that this
issue deserved further examination in the context of the Doha Development Agenda negotiations.
93. Referring to the Swiss proposals, he said that while these proposals had been built upon the
views expressed in the European Communities submission IP/C/W/383, they differed on the
substance in certain technical aspects.  The European Communities had indicated in WIPO that itshould be further examined whether it was appropriate to engage in the discussion on the substance of
the proposals within the PCT before the completion of the work in the IGC and paralleling the work
in the TRIPS Council.
94. He said that the African Group's paper made some proposals which were not acceptable for a
significant part of the membership.  He pointed out a contradiction in document IP/C/W/404, that, on
the one hand, it called for a ban on patenting all life forms, and, on the other hand, it proposed to fill
the gaps between the TRIPS Agreement and the CBD.  However, he recognized that there was somecommon ground between the African Group's paper and the European Communities' paper
IP/C/W/254.  First, the European Communiti es agreed to a flexible approach on sui generis  protection
of plant varieties.  Second, they were in favour of the rights of small or subsistence farmers to use and
save seeds, and the flexibility available in Articl es 30 and 27.3(b) of the TRIPS Agreement.  Third,
the European Communities agreed on the need for a mutually supportive approach in theimplementation of the TRIPS Agreement and the CB D.  Fourth, they agreed on the need for the
protection of traditional knowledge.  Lastly, they agreed on the need to use documentation on genetic
resources and traditional knowledge in patent searches.
95. In conclusion, he said that his delegation agreed to discuss the issue of disclosure of origin of
genetic resources and traditional knowledge, and believed that this issue was ready to be taken up atthe TNC level.  He reiterated the European Communities' willingness to insert a non-mandatory
disclosure requirement in the TRIPS Agreement under certain conditions as outlined in the EC paper
IP/C/W/383.
96. The representative of Japan informed the Counc il that, due to the divergence of views on the
disclosure of origin of genetic resources, the WIPO Working Group on the Reform of the PCT had
concluded that further and substantive discussions on this issue would be postponed to its next
session.  He thought that it was appropriate for WTO Members to continue the discussion after a
sufficient discussion on this issue in WIPO.  He said that the Council should also take into account the
discussions on the protection of traditional knowledge in the IGC.
97. As regards the relationship between the TRIPS Agreement and the disclosure of prior
informed consent and origin of genetic resources and traditional knowledge in patent applications, he
thought that these requirements should not be considered as elements of the disclosure requirementstipulated in Article 29.1 because, with or without such disclosure, a person skilled in the art could
carry out the invention based on the description written in a sufficiently clear and complete manner.
If such disclosure requirements were mandatory under the TRIPS Agreement, they would be burdens
for patent applicants.  Therefore, his delegation believed that it was inappropriate to include the
mandatory disclosure requirements of prior inform ed consent and origin of genetic resources and
traditional knowledge into the TRIPS Agreement without studying some  important issues, namely the
difference between the fields of technology and the impact of such mandatory disclosure requirements
on bio-piracy and misappropriation.
98. Turning to the protection of plant varieties, he said that the aim of plant varieties systems was
to encourage the introduction of new varieties.  Such systems should fulfil two concerns:  first, thatfarmers could introduce new varieties easily;  and second, that breeders could continue breeding
effectively.  In this regard, he said that UPOV had 52 member countries, and that the number of
protected plant varieties under UPOV was increasing.  Therefore, he believed that UPOV was a
balanced and appropriate sui generis  system for the protection of plant varieties.IP/C/M/40
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99. The representative of Australia said that, as  a signatory to the CBD, his Government had a
responsibility, at both the Federal and State levels, to develop frameworks for access to, and
utilization of, genetic and biological resources consistent with the CBD.  Australia also accepted its
responsibility to ensure the fair and equitable sharing of benefits arising out of the use of those
resources.  Such frameworks must also respect indigenous people's special knowledge of that bio-
diversity and to provide indigenous people with the choice and means to share their knowledge on fair
and equitable terms.  In the view of his delegation, there seemed to be very little concrete evidence at
this stage that national systems for regulating access to genetic resources and benefit-sharing were
per se  insufficient to deal with bio-piracy.  However,  this did not mean that such evidence might not
come to light and he did not mean to preclude further discussion on the issues.
100. He noted that the African Group appeared to have picked up some earlier suggestions made
by Australia which focused these issues on Article 29 rather than Article 27 of the TRIPS Agreement.He said that Australia's national experience suggested that the current TRIPS provisions did not and
should not create a problem in ensuring that access to materials that were subsequently the subject of
a patent application was sourced in compliance with the CBD.  Moreover, he said that there had
already been a process initiated by the CBD and closely involving WIPO, which was addressing the
issue of compliance with CBD arrangements.  On this basis, his delegation would continue toencourage further analysis of Members' experiences in implementing both the CBD and the TRIPS
Agreement as the most sensible way to move the discussion forward.
101. Furthermore, he indicated that the debate on these issues suggested that, even if there was
evidence that national systems did not work effectively, there were other options, short of amending
the TRIPS Agreement, that could be used to address the problem.  These options included informationsharing between patent offices, mechanisms to im prove disclosure of relevant information, such as
establishment of databases, or proposals such as the one by Switzerland to use the documentation
associated with patent applications to disclose th e source of relevant genetic resources, provided that
such disclosure was not a requirement for patentability.  While he considered the Swiss proposal
worthy of further discussion, he raised concerns over the suggestion that there was a need for somekind of clarification of the relationship between WTO rules and multilateral environmental agreement
rules.  In his view, there seemed to be an inhere nt tension in the Swiss paper which suggested, on the
one hand, that there was no uncertainty in the relationship between the TRIPS Agreement and the
CBD, but then suggested more generally that there were uncertainties that needed to be clarified by
means of some kind of interpretative statements.  He said that it seemed that Members were asked to
agree to a solution to an inconsistency problem which did not exist.  He also said that his delegation
had made its view clear in the Committee on Trade and Environment.
102. The delegation of Venezuela, a co-sponsor of document IP/C/W/403, said that the Council
should prevent possible conflict between the CBD and the TRIPS Agreement and continue its efforts
to adopt measures which would prevent and avoi d bio-piracy and misappropriation of genetic
resources and associated traditional knowledge.  Her delegation was convinced that the principles of
the CBD, including prior informed consent, disclosu re of origin of genetic resources, and fair and
equitable benefit-sharing, which had been ratified in the Johannesburg Summit, should be put in the
TRIPS Agreement.  She said that it was fundamenta l to ensure the progress of work in the TRIPS
Council.  Her delegation agreed with India that the Council or its Chairman draft an appropriate
recommendation on these three agenda items as a matter of urgency.
103. Referring to the Swiss paper, she said that her delegation doubted the utility of defining the
term "traditional knowledge".  Her delegation also had problems with the last paragraph of the
executive summary in the Swiss paper, which only stressed the principle that the TRIPS Agreement
and the CBD should be implemented without conflict.  However, she recognized that the Swiss paper
was a positive step to ensure a mandatory disclosu re requirement.  Turning to the African Group's
paper, she said that many aspects in the paper were similar to those in her delegation's submission andIP/C/M/40
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emphasized that the TRIPS Agreement and the CBD sh ould be implemented in a mutually supportive
and consistent manner.
104. Referring to the work in WIPO, she said that, since WIPO was still far from achieving an
instrument, it would not be appropriate for the work  in the Council to be conditional on the regular
work of other organizations.
105. The representative of Kenya, associating his delegation with the statement made by
Zimbabwe on behalf of the African Group, said that the patenting of life forms was unethical and
should be unconditionally prohibited.  He said that the moral exception in Article 27.2 of the TRIPS
Agreement was available only if the prevention within Members' territory of the commercial
exploitation of the inventions was necessary to protect ordre public or morality and such exclusion
was not made merely because the exploitation was prohibited by their laws.  In his view, both these
conditions were unnecessary and cumbersome.  The protection of ordre public and morality shouldextend to the activities outside commercial exploitation.  He thought that ethical or moral matters
were not always matters for commercial calculations, and that their force should not be affected by
reasoned commercial concerns.  In support of this view, he said that the Universal Declaration of
Human Rights recognized that the conscience of people was a legitimate concern to be protected, but
did not have the qualifications provided for in Article 27.2 of the TRIPS Agreement.  Thesequalifications amounted to redefining morality for WTO Members.  Furthermore, he said that cultural
or social values of many societies could not countenance the appropriation or marketing of life in any
form or at any stage.  The preponderance of such inherent values in particular countries was a matter
for the democratic domestic legislative process to determine, and not for the WTO whose trade
mandate was narrow and insufficient to make it an arbiter over these matters.  The compulsion toinclude micro-organisms as well as non-biological  and micro-biological processes for the production
of plants or animals was therefore inappropriate.
106. The conservation and sustainable use of biological diversity carried considerable moral and
legal force at the global level as humankind was acutely aware of the imperative to care for the
environment not only in its self-interest but also fo r its intrinsic value. The first recital to the WTO
Agreement recognized the need for sustainable use.  The WTO Committee on Trade and Environment
was mandated to develop the means of fully containing trade within environmental considerations.
The WTO jurisprudence developed under the dispute settlement mechanism was out to systematically
interpret the agreements consistently with envi ronmental considerations.  However, within the
individual agreements, certain provisions touching on the environment might not explicitly address
the concerns.  This was the case in Article 27.3(b) of the TRIPS Agreement which required the
protection of plant varieties without recognizing the CBD, a principal international instrument onconservation and sustainable use of biological diversity.
107. He said that Africa was rich in biological diversity and wished to develop such resources to
its advantage and to the advantage of the entire humankind.  The CBD duly recognized and protected
this interest.  While the CBD required prior informed  consent, benefit-sharing, authorization from the
host government and technology transfer, Article 27.3(b) of the TRIPS Agreement did not recognizeand protect these requirements.  Article 27.3(b) therefore was a means of defeating the CBD if
Members were to merely protect the rights of commercial breeders as the way of implementing the
requirements to protect plant varieties by a patent or a sui generis  system or the combination.
Therefore, he thought that it was vital for Article 27 to incorporate the requirements under the CBD, if
not on the basis of the first recital of the WTO Agreement for sustainable resource use as well as ofthe WTO decisions and jurisprudence, then on the basis of the objectives and authority of the CBD.
108. As regards the concepts of traditional knowledge and farmers' rights, he believed that the
recognition and protection of farmers' rights, especially to save, share, sell and re-use seeds, was
affected by the protection of plant varieties.  In support of his view, he said  that under the 1991 Act
of UPOV, any exceptions to allow the exercise of farmers' rights was subject to reasonable restrictionsIP/C/M/40
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and the legitimate interests of breeders.  The exception did not extend to the sharing of propagating
materials and it only applied to saved materials from harvest on farmers' holdings.  The terminator
technology and grinding poverty in the developing countries rendered this exception meaningless for
all practical purposes.  That consequences would be food insecurity and countries' dependence on
commercial breeders abroad for seeds.  Besides, bio-patenting made it illegal to save and use certainseeds for staple foods long-known and used by farming communities.  As a result,  traditional
varieties might be killed off by genetically modified varieties, causing a depletion of biological
diversity apart from the implications on food insecurity.  He further said that, while the identification
and conservation of staple or medicinal plants was traditional knowledge, long usage did not qualify
these plants as varieties for the purposes of UP OV.  The CBD, however, recognized this knowledge
and went further to require benefit-sharing and countries' authorization as conditions for access to
genetic materials, including these plants and associated knowledge.  The African Group's paper calledfor a recognition and protection of farmers' rights and traditional knowledge.  It could serve as a
model law for the purpose of sui generis  systems under Article 27.3(b) of the TRIPS Agreement.
109. Finally, he proposed that Article 27.3(b) of the TRIPS Agreement be reviewed to duly take
into account the concerns raised by the African Group.  He said that the review should, first, provide
unqualified exceptions that recognized the rights of Members to take measures in the public interest,and unqualified exceptions for exclusions from patentability, including the exclusion on ethical or
moral grounds;  second, it should do away with the di stinction drawn for micro-organisms as well as
for non-biological and micro-biolog ical processes for the production of plants or animals, and exclude
all these from patentability together with plants, animals and essentially biological processes;  third, it
should clarify that sui generis  systems were domestic laws adopted to protect plant varieties within
the context of important domestic goals and other relevant international obligations;  fourth, it should
take into account Articles 1, 2, 8(j), 10, 15, 16 and 19 of the CBD and the provisions of the
ITPGRFA;  finally, it should require universal novelty in order to deal with piracy of traditional
knowledge and the non-recognition of information available to society through use or oral tradition.
110. The representative of the Dominican Republic associated her delegation with the statement
made by India and requested the Secretariat to add her delegation as a co-sponsor to document
IP/C/W/403.  Referring to the African Group's paper, she said that it had many common points with
the proposal in document IP/C/W/403.  Turning to th e Swiss paper, she said that the paper contained
some points with which her delegation fully agreed, such as the modification of the PCT so that it
could contain the requirements of prior informed consent, equitable benefit-sharing, disclosure of
origin of genetic resources and traditional knowledge.  However, she said that her delegation was not
entirely sure of the proposal that it was not necessary to change the provision of the TRIPSAgreement and that Members could reach a solution through the establishment of transparency
measures.  Her delegation said that WTO Members were trying to establish rights and obligations
under which they were able to require prior informed consent, disclosure of origin of traditional
knowledge or genetic materials, and equitable benefit-sharing.  Her delegation did not believe that
transparency measures would meet this objective.  Finally, she believed that it was not necessary todefine traditional knowledge for the purpose of protection.
111. The representative of Canada said that the review of Article 27.3(b) had included discussions
on a wide range of important issues, many of which did not fit within the narrow scope of the wording
of the review envisaged by this provision.  In Canada's view, the primary purpose was to review
Members' experiences with implementing the provisions related to patents on higher life forms andsui generis  protection of plant varieties.  She said that the Secretariat had produced a useful summary
document that outlined the discussions to date on those issues and also a synoptic table that outlined
Members' responses to the Secretariat's illustrative list of questions.  In order for this to be a
comprehensive representation, she encouraged all Members to respond to the list of questions.
112. The permissive exceptions contained in Article 27.3(b) to patentability of higher life forms
reflected the balance achieved in the Uruguay Round on the issue of patentable subject matters.  ManyIP/C/M/40
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countries had subsequently chosen to allow patents on higher life forms while others had chosen not
to, based on their own specific national circumstances and goals.  She informed the Council that
Canada was currently considering this issue domestically.  The independent Canadian Biotechnology
Advisory Committee (CBAC) had recommended in th e summer of 2002 that Canada amend its patent
legislation to allow for patents on higher life forms, subject to certain safeguards.  In the fall 2002, theSupreme Court of Canada had concluded, in its de cision in the Harvard-Onco Mouse case, that the
current Canadian Patent Act did not allow for patents to be granted on higher life forms.  The
Canadian Government was currently reviewing both the CBAC recommendations and the Supreme
Court's decision to determine the future course on  this question domestically.
113. She said that there was still much to do to en sure that the current TRIPS Agreement was fully
implemented before WTO Members would be in a position to consider any changes to the substantive
obligations under Article 27.3(b).  In Canada's view , the existing wording of the provision provided
flexibility for Members to decide whether or not to allow patents on higher life forms, and retaining
this flexibility was in the best interest of all Members.
114. With respect to the meaning of effective sui generis  protection for plant varieties, she said
that the discussion had revolved around the scope of Members' obligations under the penultimate
sentence of Article 27.3(b), in particular on what was qualified as an effective sui generis  system.  In
Canada's view, UPOV offered an effective sui generis  system for the purposes of Article 27.3(b).  She
indicated that, as a member of UPOV, Canada had implemented the principles of UPOV through the
Canadian Plant Breeder's Rights Act.  However, she said that her delegation did not suggest that all
WTO Members must use the UPOV standard and agreed that it was possible for Members to
implement a minimum set of standards in order to meet their TRIPS obligations.  She said that therecent Secretariat note on this issue provided a useful summary of what such minimum standards
might contain.  With particular reference to one issue that some Members had raised, including the
African Group in its communication, she said that Me mbers might, in complying with obligations for
sui generis  protection of plant varieties, allow traditional farmers to save and sow seeds for their own
use as long as the legitimate interests of commercial plant breeders were protected.
115. Turning to the question of the relationship between the TRIPS Agreement and the CBD, she
said that the various proposals on this issue indi cated how far the Council had come on this question
and how much good will there was in this Counc il to resolve the issues.  On the one hand, most
Members seemed to agree that there was no legal conflict between the TRIPS Agreement and the
CBD, even as Members seemed to continue to disagree on the appropriateness of using the TRIPS
Agreement to facilitate the pursuit of equitable claims that might arise out of provisions of the CBD.
On the other hand, the submission by Switzerland and some of the responses to it had illustrated thewillingness of developed country Members to find fair and balanced solutions.  Furthermore, support
among them for the implementation of national access laws that used transfer agreements was strong.
Canada acknowledged the difficulties in dealing w ith the issue of bio-piracy and joined those
developed country Members who had called for a balanced solution.  In Canada's view, the TRIPS
Agreement and the CBD could each be implemented in a manner that made them mutually supportiveand beneficial.  In support of this view, she said that nothing in the TRIPS Agreement prevented
countries from providing in their national access laws that benefit sharing arrangements should be
mutually agreed and based on consent.  She applauded the efforts of those Members who were
developing such access laws in a manner that ensured both the facilitated access to genetic resources
for continued use in valuable research and the fair and equitable sharing of benefits.  She recognizedthat some Members felt such regimes would not be sufficient due to presumed difficulties of setting
them up and in enforcing them.  In response to this concern, she said that the proposals by the
European Communities and Switzerland and the joint communication from India and other Members
were, to varying degrees, about using the inform ation gathering capacity of patent examination
procedures to gather information related to access and benefit sharing.  This concept seemed, inprinciple, at least worthy of further consideration.IP/C/M/40
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116. In addition, her delegation thought that the discus sion of such linkage did not need to occur in
the TRIPS Council as it was convinced that the TRIPS Agreement was flexible enough for Members
to pursue these objectives outside of the TRIPS Agreement.  Her delegation did not believe that it was
appropriate at this stage for them to be discussed in the WIPO Working Group on the Reform of the
PCT.  Rather, the WIPO IGC had been established precisely to deal with intellectual property-relatedcomponents of this issue.  She reminded Members that the IGC had recently engaged in a technical
study of  the same requirements proposed in the Council.  She acknowledged that while that process
had been slow, as pointed out by the African  Group in its communication, Members should allow
technical work to run its course before they atte mpted to comprehensively assess the merits of the
proposals in the Council or enter in any new binding commitment.
117. The representative of Cuba said that, with respect to the relationship between the TRIPS
Agreement and the CBD, it was necessary for the Council to make a decision in accordance with the
Doha mandate.  She said that the Council could not await the outcome of the work being done in
WIPO.  She said that rules were needed to regulate  the conduct of those who, acting contrary to the
existing provisions and arguing a lack of appropriate legislation, misused genetic resources and
traditional knowledge of Members and communiti es whose development and suitable survival
depended on such resources.   It was therefore necessary for the Council to reach a decision aimed atpreventing or avoiding such misuse or abuse, ei ther through an amendment of the TRIPS Agreement
or an authoritative interpretation of Article 29, or some other ways, so that Members would be able to
adopt measures providing for action under the dispute settlement mechanism, while ensuring that this
was underpinned by principles or rules that did not  give rise to any ambiguity or contrived legal
interpretation.
118. Referring to the African Group's paper, she said that Article 27 clearly established the
availability of patents for inventions, but excluded discoveries from patentability.  Plants and animals
might be excluded from patentability - an exception which applied without any possibility of
interpretation beyond that statement.  However, there were other elements in Article 27.3(b) the
implementation of which should be based on the distin ction that could be established by applying the
traditional principle of the patent system, regardless of contrived doctrines used by interested
Members in order to challenge its original underpinnings.
119. Finally, she said that her delegation attached great importance to the relationship between the
TRIPS Agreement and the CBD since the internatio nal treaty in the FAO was dealing with, but had
not yet solved, the related problems.  Therefore, she asked the Council to take a decision on the
proposal contained in document IP/C/W/403.
120. The representative of China said that his delegation agreed with the substance of the proposal
in document IP/C/W/403.  He said that intellectual property protection in the current WTO system
emphasized the protection of private rights but neglected developing countries' interest in the
protection of traditional knowledge even though pa ragraphs 18 and 19 of the Doha Declaration listed
the protection of traditional knowledge as one of the negotiating issues in the new round.  He said that
China was rich in traditional knowledge and that the Chinese Government had useful experience inthe protection of traditional knowledge through intellectual property and other legal systems, for
example through patent protection.  However, the current intellectual property system could not
provide effective protection for traditional knowledge and, therefore, Members should establish a
multilateral framework for the protection of traditional knowledge.
121. Regarding the relationship between the TRI PS Agreement and the CBD, he believed that it
involved not only the protection of genetic resour ces and related traditional knowledge but also the
full implementation of the CBD.  He said that the principles and objectives of the CBD could be
realized through intellectual property rights, incl uding sovereign rights, prior informed consent and
benefit-sharing through certain safeguards.  He suggested that, as proposed by China, Brazil, India
and other developing countries in June 2002, these three principles of the CBD be incorporated intoIP/C/M/40
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Article 29 of the TRIPS Agreement.  He said that further study was needed on the specific
enforcement and the effect of the current patent systems on these issues.  This would allow Members
to revise their domestic patent laws to satisfy the requirements of the CBD.  Referring to Norway's
presentation in February 2003, he said that the punishment of a failure to disclose origin was an
effective way to implement the principles of the CBD.
122. Referring to document IP/C/W/403, the representative of the United States said that neither
the intellectual property system in general nor the TRIPS Agreement in particular were appropriate
instruments for regulating access to genetic resources, benefit-sharing or the commercialisation of
products deriving from genetic resources.  He said that requiring, as a condition of patentability, the
disclosure of genetic resources, evidence of pr ior informed consent and benefit-sharing would do
nothing to ensure that prior informed consent or benefit-sharing actually occurred.  If a patent were to
be invalidated for failure to comply with these requ irements, there would be no benefits to share.  He
said that, on the other hand, contractual systems ensured that benefit-sharing occurred in the event of
any commercialisation of products based on genetic materials to which access had been provided,
whether or not those products were the subjects of patents.  He said that suits for breach of contracts
could result in court orders for specific performance or for damages.  Contracts could also specify
how disputes that arose under the contract would be handled and that criminal penalties could be
applied for violation of laws regulating access.
123. Since there was no conflict between the TRIPS Agreement and the CBD, they could be
implemented in a mutually supportive fashion.  WIPO  and the CBD had been exploring the best ways
to ensure that countries could control access to their genetic resources and promote benefit-sharing
while respecting intellectual property rights as ca lled for in Article 16.2 of the CBD.  Members should
let them continue their work in this area.  The United States had tabled several papers explaining why
there was no conflict between the TRIPS Agreement and the CBD and why no amendment of the
TRIPS Agreement was needed.  These papers detailed the legal frameworks and contract-based
systems already in place in the United States, for example, in US national parks.  Referring to the
papers tabled by the European Communities, Japan, Australia and Switzerland, he said that mostWTO Members did not support the idea of amending the TRIPS Agreement in this regard.
124. Commenting on the submission by Switzerland, he said that the goal of the proposal was to
achieve timely solutions for ensuring access to genetic resources and traditional knowledge as well as
benefit-sharing.  While his delegation shared that goal, it did not believe that this goal was furthered
by any type of requirement in patent laws.  He said that patent laws were not the appropriate place to
deal with matters of misappropriation of genetic resources and traditional knowledge, or other matters
of general misconduct.  He urged, instead, the creation of effective national systems of access andbenefit-sharing with respect to genetic resources and traditional knowledge.  He said that such
systems could incorporate, for example, collection agreements that would condition any removal of
resources on determined appropriate compensation, and that might include shares of both monetary
and non-monetary benefits deriving from any inventions developed from those resources.  Such an
agreement could also include regular reporting requirements to determine what use was being made ofthe resources or traditional knowledge.  This was the type of solution that could deal with any real or
perceived problems of misappropriation of genetic resources or traditional knowledge.
125. In conclusion, he reiterated that, since no conflict existed between the TRIPS Agreement and
the CBD, there was no need to amend the TRIPS Agreement and that the patent system was not the
appropriate mechanism to deal with access and benefit-sharing issues.  Members should let theleading technical agencies, namely the CBD and WIPO, continue to handle these matters, and remove
this item from the TRIPS Council's agenda.
126. The representative of Chile informed the Council that his country was in process of setting up
a biotechnology commission whose work and recommenda tions would be available in the next couple
of months.  He believed that, although some issues under the three agenda items were being looked atIP/C/M/40
Page 26
in other fora, their resolution should be found in the WTO.  On the other hand, the discussion in the
TRIPS Council should not hinder the discussion in WIPO or the modification to other international
treaties, such as the PCT or the PLT.  He also believed that the binding force of the TRIPS Agreement
was greater than that of other multilateral agreements within or outside WIPO.  His delegation agreed
that contracts as well as databases were valuable instruments, and that databases should be updated tofacilitate the work of national patent offices.  However, neither contracts nor databases were sufficient
to solve the problem alone. He said that the requirements on patent applications could be different for
different fields of technology.  Finally, he said th at a multilateral solution to these issues in the WTO
was urgent for developing countries.
127. The representative of Colombia indicated her delegation's support of documents IP/C/W/356
and IP/C/W/403.  She said that the proposals in these documents would enable Members to require
patent applicants to disclose the origin of genetic resources and traditional knowledge, evidence ofprior informed consent and fair and equitable benefit-sharing.  These requirements recognized the
rights of the countries and communities over genetic resources and traditional knowledge and were
not to be seen as burdens for patent applicants.  The Council should make progress in this area to
comply with paragraphs 12 and 19 of the Doha Declaration.  Referring to the statement made by
Cuba, she said that there were two options for th e modification of the TRIPS Agreement:  either an
amendment of the Agreement or an authoritative interpretation.  Her delegation preferred the latter.
128. The representative of Malaysia said that documents IP/C/W/403 and 404 needed to be studied
carefully, particularly in terms of whether a change to the PLT or the PCT could achieve the same
objective.  She said that some references had been made to the need for making the CBD and the
TRIPS Agreement mutually supportive.  She noted that many Members had stated in the Committeeon Trade and Environment that multilateral environmental and the WTO agreements were mutually
supportive and without conflict.  The proposals in documents IP/C/W/403 and 404 were meant to
ensure the reduction of bio-piracy and the protection of genetic resources.  Commenting on the
African Group's paper, she said that, first, she agreed that Members had the right and freedom to
determine an appropriate sui generis  system for the protection of plant varieties;  second, farmers'
exceptions should be provided for in national systems;  and third, the TRIPS Agreement should not
prevent Members  from providing protection for tr aditional knowledge with in their own national
systems.
129. The representative of India said that the issues under the three agenda items were ripe enough
to be discussed at the TNC level.  He said that, under paragraph 12(b) of the Doha Declaration, his
delegation would be interested in an intensive work on these issues for a meaningful outcome in
Cancún.
130. The representative of Switzerland said that his delegation looked forward to discussing the
issues at the TRIPS Council's next meeting so that Members could have an opportunity to examine the
recent communications in detail.
131. The representative of the United States said that the discussion on these issues seemed to be at
the early stages and that his delegation was not prepared to refer them to the TNC.
132. The representative of Brazil said that these three agenda items had been discussed under a
double negotiating mandate under paragraphs 12 and 19 of the Doha Declaration.  He reminded
Members that the current Council's meeting was the last one before the Fifth Ministerial Conference
and that it was important for the Chairman to re port to the TNC on the discussion in the Council,
especially on any recommendation to amend the TRIPS Agreement.
133. The representative of Canada said that the disc ussion over the past years clearly indicated that
many questions had not yet been resolved.  Her delegation still had no clear sense what all Members
were doing to respond to the Secretariat's synoptic table on the implementation of Article 27.3(b).  InIP/C/M/40
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this regard, she said that it would not be appropriate for the Council, which had not been able to reach
consensus itself, to forward the issues to the TNC.
134. The representative of Australia said that the outstanding implementation issues were currently
the subjects of consultation by the Director-General.  That process should be allowed to proceed
before the Council would decide how to address the matter.  The situation was correctly reflected inparagraph 3 of the draft agenda, which read as follows: "[i]t is proposed that items D, E and F would
not include consideration of outstanding implementation issues relating to these matters, given the
action under way in the context of the TNC on outstanding implementation issues".  He questioned
the need for Members to engage in a long discussion on this issue.
135. The representatives of Peru, Cuba
, the Dominican Republic , Venezuela , Colombia , China  and
Kenya supported the proposal to move the discussions to the TNC level.
136. The representative of the European Communities said that his delegation would have no
difficulty with the Chairman's report to the Chai rman of the TNC on the discussions that had taken
place in the Council.  He emphasized that it might be time to make a decision on the disclosure of
origin.
137. The Chairman said that he would brief the Chairman of the TNC on the discussion that had
taken place in the Council and that Members would have an opportunity to discuss these subjects
again at the meeting of the Council in November 2003.
138. The Council took note of the statements made under these three agenda items.
G. REVIEW OF IMPLEMENTATION OF THE TRIPS AGREEMENT UNDER ARTICLE 71.1
139. The Chairman recalled that his predecessor had noted, at the Council's meeting in
March 2002, that a substantial number of suggestions for topics to be considered under Article 71.1
review had been made prior to the Doha Minister ial Conference, but some of them overlapped with
other items on the Council's post-Doha agenda.  In c onsidering how to organize its work, the Council
had invited Members to submit ideas for issues to be taken up under this agenda item by the June
2002 meeting, without prejudice to the right of Members to submit ideas at a later stage.  While some
observations had been made under this item, to date, no suggestions for topics to be taken up had beentabled by any Members.
140. The representative of the United States said  that the TRIPS Agreement was functioning well
in helping WTO Members to establish favourable climates in their territories for creativity, innovation
and investment.  To further transparency, he urged those countries which had not yet notified their
intellectual property legislation to the TRIPS Council to do so.
141. He added that technological development, particularly with respect to the Internet, had led to
the broad acceptance of the WIPO Internet treaties by WTO Members.  Therefore, he urged thoseMembers who had not yet acceded to these treaties to consider doing so.
142. The Council took note of the statements .
H. NON-VIOLATION AND SITUATION COMPLAINTS
143. The Chairman recalled that, at Doha, the Ministerial Conference had adopted a decision on
Implementation-Related Issues and Concerns (WT/MIN(01)/17).  Paragraph 11.1 of the Decision
stated that "[t]he TRIPS Council is directed to continue its examination of the scope and modalities
for complaints of the types provided for under subparagraphs 1(b) and 1(c) of Article XXIII of
GATT 1994 and make recommendations to the Fifth Session of the Ministerial Conference.  It isIP/C/M/40
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agreed that, in the meantime, Members will not  initiate such complaints under the TRIPS
Agreement".  He also recalled that, at its meeting in September 2002, the Council had set the first
meeting of the Council in 2003 as a target date for the submission of specific proposals from
delegations.  This, however, was not to preclude earlier papers, or later ones, in an effort to find
common ground.  Since then, the Council had received one specific proposal on a recommendationthat the Council could make to the Cancún Ministerial Conference.  This proposal, introduced by Peru
at the Council's meeting in November 2002, had been circulated in document IP/C/W/385.
144. He noted that the present meeting was the only formal meeting of the Council scheduled prior
to the Ministerial Conference and that, consequently, the Council should now agree on the
recommendation that it was instructed to make to the Cancún Ministerial Conference.  In view of this,
he recalled that he had taken this matter up at the Council's informal meeting on 23 May.  In order to
stimulate practical thinking on the action that the Council should take at the present meeting, he hadnoted at that meeting that, from a purely conceptu al standpoint, there appeared to be four main
options logically possible for such a recommendation:
• At one end of the spectrum, one option would be to follow the proposal in document IP/C/W/385
and recommend to the Fifth Ministerial Conference that violations of the type identified inArticle XXIII.1(b) and (c) of GATT 1994 be determined inapplicable to the TRIPS Agreement.
This would require some delegations to alter their position.
• At the other end of the spectrum, there was the option that the Council make, at the end of the
present extension of the moratorium, non-violation and situation complaints available under theTRIPS Agreement, without subjecting them to any specific guidance as to their scope and
modalities over and above those already envisaged by the DSU, i.e. the general safeguards
provided in Article 26 of the DSU.  The acceptance of this would require a large number of
delegations to change their position.
• A third option was to recommend that non-violation and situation complaints be made available to
disputes arising under the TRIPS Agreement, but make them subject to some specific additionalguidance on their scope and modalities.  The Council had agreed at its meeting in September 2002
to set the February 2003 meeting as the target date for any specific proposals in this regard.  As of
the date of the present meeting, the Council had not received any proposals that could form the
basis for such guidelines.
• The fourth option was to recommend to the Fifth Ministerial Conference that the moratorium be
further extended so as to allow the Council more  time to consider the scope and modalities of
non-violation and situation complaints in the area of TRIPS.  He further recalled that, at the
Council's informal meeting of 23 May, many delegations had noted that they still needed
instructions from their capital or that th ey had not yet determined their position.
145. The representative of Peru supported the first option put forward by the Chairman in his
consultations and reiterated the proposal contained in document IP/C/W/385, i.e. that subparagraphs
1(b) and 1(c) of Article XXIII of GATT 1994 be determined inapplicable to the TRIPS Agreement.
She disagreed with the opinion expressed by some Members that non-violation and situation
complaints apply to the TRIPS Agreement on the expiry of the time-period under Article 64.2 for
various reasons.  Article 64.3 provided that "[t]he Council for TRIPS shall examine the scope andmodalities for complaints of the type provided for under subparagraphs 1(b) and 1(c) of Article XXIII
of GATT 1994 made pursuant to this Agreement, and submit its recommendations to the Ministerial
Conference for approval".  Moreover, as said in paragraph 12 of document IP/C/W/385,
"[n]otwithstanding the expiry of the time-per iod under Article 64.2, non-violation and situation
complaints only apply to the TRIPS Agreement in accordance with the procedure established under
Article 64.3.  Complying with this procedure, the importance of which Ministers reaffirmed throughIP/C/M/40
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their adoption of the decision on Implementation-Re lated Issues and Concerns, should be a matter of
priority for the TRIPS Council."
146. Article 64 should be read in context and in the light of the objectives and principles of the
TRIPS Agreement.  This was reiterated by Ministers in paragraph 5 of the Declaration on the TRIPS
Agreement and Public Health, when they stated that the flexibilities in the Agreement included that"[i]n applying the customary rules of interpretation of public international law, each provision of the
TRIPS Agreement shall be read in the light of the object and purpose of the Agreement as expressed,
in particular, in its objectives and principles".  Article 7 of the Agreement stipulated that "[t]he
protection and enforcement of intellectual property rights should contribute to the promotion of
technological innovation and to the transfer and di ssemination 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".  It should be noted that according to Article 8"Members may, in formulating or amending their laws and regulations, adopt measures necessary to
protect public health and nutrition, and to promote the public interest in sectors of vital importance to
their socio-economic and technological development".  Article 64 should also be read in the light of
Article 1 of the Agreement (nature and scope of obligation), which stated that "Members may, but
shall not be obliged to, implement in their law mo re extensive protection than is required by this
Agreement, provided that such protection does not contravene the provisions of this Agreement.
Members shall be free to determine the appropriate method of implementing the provisions of this
Agreement within their own legal system and practice."
147. With respect to the application of non-violation and situation complaints, she considered that
instead of promoting the balance of rights and ob ligations and the public interest and maintaining
flexibility in the implementation of the TRIPS Agreement, this remedy would create serious
difficulties for WTO Members and the multilateral trading system.  The application of non-violation
and situation complaints to the TRIPS Agreement was neither necessary nor desirable and indeed not
possible.  She added that this opinion was shared by the great majority of WTO Members.
148. She stressed that complaints of this type were not necessary within the context of the TRIPS
Agreements since the Agreement was not designed to protect market access or the balance of tariff
concessions but rather to establish minimum standards of intellectual property protection.  These
standards were explicitly contained in the provisions of the Agreement, which included both specific
provisions and their enforcement.  In this respect, it would be inappropriate to apply the legally
imprecise notion of non-violation and situation comp laints.  The best way of guaranteeing the rights
and obligations under the TRIPS Agreement was through a good faith application of its provisions in
accordance with the established principles of international law recognized by the Appellate Body.Furthermore, the application of the notion of non- violation and situation complaints to the TRIPS
Agreement was undesirable because it raised systemic concerns.  Such application could introduce
incoherence among the various WTO agreements, could upset the delicate balance of rights and
obligations under the TRIPS Agreement, and undermine regulatory authority by exposing it to
undesirable situations.  Additionally, it would not be possible to apply this concept within the contextof the TRIPS Agreement for the various reasons set out in document IP/C/W/385. In particular,
authorizing the non-violation and situation remedy under the TRIPS Agreement could imbalance the
proper distribution of responsibilities between Members, and panels and the Appellate Body.
149. She noted that no reply had been received from those Members who were urging such
authorization and said that her delegation was still waiting for concrete examples of situations inwhich a good faith application of the provisions of the Agreement would not be sufficient to achieve
its objectives.  The possible scope and modalities to be adopted in applying complaints of this type in
the context of the TRIPS Agreement also needed to be indicated.  Insofar as those who defended this
remedy had not provided any evidence that such a mechanism would promote the fundamental
objectives of the TRIPS Agreement, or of the multilateral trading system, her delegation was of theopinion that non-violation and situation complaints continued to be unnecessary and indeedIP/C/M/40
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inconsistent with the interests of WTO Members.  In conclusion, she said that her delegation believed
that the best solution, and that which would offer the multilateral trading system the greatest legal
certainty and predictability, was that contained in the proposal submitted by 14 developing countries
in document IP/C/W/385.
150. The representatives of Argentina, Brazil, Cuba and Zimbabwe said that their delegations, as
co-sponsors of document IP/C/W/385, associated themselves with the statement made by the
delegation of Peru and expressed the view that the only possible option among those presented by the
Chairman was the first option, i.e. to recommend to the Fifth Ministerial Conference that violations of
the type identified in Article XXIII.1(b) and (c) of GATT 1994 be determined inapplicable to the
TRIPS Agreement.
151. The representative of Venezuela said that her delegation, as one of the co-sponsors of
document IP/C/W/385, held the view that the concep t of non-violation and situation complaints was
foreign to the work done at the Council and, as such, could introduce incoherence among the various
WTO agreements, which would affect the general balance of rights and obligations between
Members.
152. The representative of Thailand, also speaking on behalf of Brunei Darussalam , Indonesia ,
Malaysia and the Philippines , reiterated his opposition to the application of non-violation and
situation complaints to the TRIPS Agreement.  No elements based on legal or other grounds had been
presented to demonstrate the need for such a remedy.  In fact, raising non-violation and situation
complaints would only impose systemic difficulties in the operation of a predictable and rule-based
multilateral trading system.  This was because such complaints would introduce elements of legal
uncertainty that could result in actions going beyond the TRIPS Agreement, which was only aminimum standard agreement.  For these reasons, he was of the view that the only possible option
among those presented by the Chairman was the first option.
153. The representative of Chile asked her delegation to be included as a co-sponsor of document
IP/C/W/385.  She said that she associated herself with the statement made by the delegation of Peru
and expressed the view that the only possible option among those presented by the Chairman was thefirst one.
154. The representative of Canada said that Canada had been active from the very beginning of the
mandated examination of the scope and modalities regarding the application of non-violation and
situation complaints to the TRIPS Agreement.  Throughout this examination, Canada had consistently
expressed the concern that transplanting this ty pe of remedy into the TRIPS environment would
introduce a measure of uncertainty, which would result ultimately in constraints on domestic policy-
making beyond what Members had agreed to when they had negotiated this Agreement. Such aremedy designed to deal mainly with issues aris ing in market access agreements was not suitable in
the context of the TRIPS Agreement, which was a sui generis  agreement among trade agreements and
dealt with the creation of minimum standards.
155. Canada preferred the first option outlined by the Chairman.  As regards the second option, the
Council's continued disagreement about the appropriat eness of such remedies would make it difficult,
if not impossible, to arrive at the consensus required by Article 64(3) to make such a
recommendation.  Consequently, Canada could not support it.  The third option was to prepare
guidelines before Cancún on how to proceed with non-violation and situation complaints.  That
seemed unlikely in the short time the Council had befo re the next Ministerial.  Given the different
views of Members on this matter, the fourth option seemed the more reasonable alternative.However, in that case Canada would like to propose that, rather than simply recommending to
Ministers that the Council continue to examine the issue, such a recommendation should also include
a specific work programme, which would operate with clear terms of reference and under a strict
deadline.IP/C/M/40
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156. The representative of Colombia said that, at the Council's meeting in September 2002, her
delegation had put forward, on behalf of the countri es of the Andean Community, the view that the
application of non-violation complaints under the TRIPS Agreement was a concept that remained
difficult to justify and was the cause for serious concern in many developing countries, particularly if
the application of such complaints would run the risk of upsetting the balance between the rights andobligations of producers and users of technological knowledge, which could result in the creation of
new obligations.  She recalled that the discussion on non-violation complaints in this Council dated
back to 1999, and that the Doha Ministerial Declaration instructed the Council to continue its
examination of the scope and modalities with a view to issuing recommendations to the Fifth Session
of the Ministerial Conference.  To that end, Colombia was one of the 14 developing countries to
subscribe to document IP/C/W/385 of 30 October 2002, which Peru had presented at the September
2002 meeting and which expressed its view that the application of non-violation and situationcomplaints to the TRIPS Agreement would be unnecessary and inconsistent with the interests of
WTO Members.  Any benefits accruing under the Agreement could indeed be adequately protected by
applying the text of the Agreement in accordance with  accepted principles of international law, and
without introducing the legally uncertain notion of "non-violation" and "situation". Therefore, her
delegation proposed, as the only option possible, that the TRIPS Council recommend to the FifthMinisterial Conference that complaints on the grounds of nullification or impairment of the type
identified in Article XXIII: 1(b) and (c) of GATT 1994 be determined inapplicable to the TRIPS
Agreement.
157. The representative of Australia said that he had sympathy towards the first option and was not
likely to stand in its way if consensus could be found around it.  However, previous informal
consultation on this issue seemed to show that this might be difficult.  Since this was the last meeting
before Cancun, he was attracted to the fourth option, i.e. a prolongation of the current moratorium, as
the most sensible and practical way to go forwar d.  Such an approach would enable the Council to
continue the discussions on this topic.  In such a case, his delegation would be interested in addressing
many of the points that had been made in the discussions so far, such as the ones made by Peru andother developing countries on legal uncertainty.  Furthermore, he noted that the paper his delegation
had submitted in September 2000 on this issue (IP/C/W/212) was not a formal position paper as such
and was tabled to outline some of the key issues.
158. The representative of Hong-Kong, China said that the TRIPS Agreement was not about
market access or exchange of concessions.  It only set the minimum levels of implementation of IP
protection provided under Article 1 of the Agreement.  Members were free to determine the
appropriate method of implementing its provisions.  Consequently, his delegation was of the view thatoption one was the most appropriate way forward.
159. The representative of Norway said that, in previous discussions on this issue, his delegation
had taken the view that non-violation and situation complaints did not belong under the TRIPS
Agreement and supported many of the points put forward by Peru and other delegations.  The benefits
which accrued under the TRIPS Agreement should be understood to be those which were specificallydescribed in its various Articles.  The TRIPS Agreement contained a number of very detailed
commitments, many of them deriving from other multilateral treaties which had been in operation for
many years.  When the TRIPS Agreement was negotiated under the Uruguay Round, negotiators
knew very well which rights and obligations were to be given to Members.  Hence, applying non-
violation and situation complaints to the TRIPS Agreement would be particularly difficult andproblematic in relation to the principle of legal certainty.  He therefore strongly supported option one.
160. The representative of China, associating himself with the statement made by the delegation of
Peru and supporting the views expressed in documen t IP/C/W/385, said that the first option was the
most appropriate one.  Non-violation and situation co mplaints were created as a means of maintaining
the balance of interests of each Member, especially in relation to concessions made under GATT andGATS.  On the other hand, TRIPS only created a mi nimum standard for the protection of intellectualIP/C/M/40
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property rights.  No concrete and persuasive reasons had been given by proponents in support of the
application of non-violation and situation complaints to TRIPS and little precedent existed in the
application of such complaints even in the area of GATT and GATS.  The application of non-
violation and situation complaints could lead to lack of clarity and uncertainty in the area of TRIPS
and could be especially burdensome to developing countries due to the insufficiency of capacitybuilding in this area.
161. The representative of Hungary said that his delegation supported the views expressed in
document IP/C/W/385 and, consequently, the adoption of option one.
162. The representative of Korea recalled that, early in these discussions, his delegation had made
a written contribution (JOB(00)/6166) in which it had stressed the importance of taking into account
the special nature of the TRIPS Agreement in considering the scope and modalities of applying non-
violation and situation complaints to issues relating to intellectual property rights.  The discussionshad led his delegation to believe that applying non-violation and situation complaints to the TRIPS
Agreement would be difficult and inappropriate, and would also introduce great uncertainty.  Such
consequences should be avoided if the goal of TRIPS was to implement a viable regime of intellectual
property protection.  In this light, his delegation had great sympathy for option one.  Yet, as indicated
in the May 23 informal meeting, his delegation also recognized that there was opposition to the firstoption.  Given this situation, Korea believed that the fourth option, i.e. continuing the moratorium and
discussion, would be the most appropriate course Members could take at the present juncture.
However, in accepting the fourth option, as Canada had suggested, Members would have to work
under strict terms of reference and a clear work programme.
163. The representative of New Zealand said that her delegation had agreed with many of the
arguments made in document IP/C/W/385, sponsored by Peru and other Members, and accordingly
viewed option one as the preferred option.  However, her delegation recognized the existence of
restraints on the Council and on the Chairman in moving this issue forward before the Fifth
Ministerial Conference and in that light her delegation saw the fourth option as also being a practical
way to proceed.  As Canada and Korea had both noted, there might be a need, in case the fourthoption were to be pursued, to set down some parameters for that discussion.
164. The representative of Chinese Taipei said that, given the present situation, the fourth option
would be a better solution that would give all Member s more time to consider other proposals.  In this
sense, his delegation also supported the Canadian proposal to recommend that Ministers set up a work
programme for this issue.
165. The representative of India supported option one.  He said that most of the interventions made
so far had preferred this option as the only one acceptable, and those who had been willing to accept
option four, had showed sympathy towards the first option or even stated that it was their preferred
one. He also recalled that an annotated agenda circulated by the Chairman on 21 June 2002
(JOB(02)/66) referred to the question of whether "the benefits that Members are entitled to expect
under the TRIPS Agreement are limited to compliance with the literal wording of the Agreement or
do they go in some way further".  The other questions assumed relevance only if the reply to thisquestion was that Members were indeed entitled to benefits which in some way would go further than
the literal wording of the Agreement.  As stated by Peru and others, document IP/C/W/385 attempted
to address the questions referred to in the Chairman's annotated agenda.
166. The principles contained in Article 8 of the TRIPS Agreement gave flexibility to Members to
adopt measures necessary to protect public health and nutrition, and to promote public interest insectors of vital importance to their social-economic and technological development, provided that
such measures were consistent with the provisions of the TRIPS Agreement.  Article 8 further
provided that appropriate measures could be taken to prevent the abuse of intellectual property rights
by right holders or the resort to practices which unreasonably restrained trade or adversely affectedIP/C/M/40
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the international transfer of technology.  The structure of Article 8 clearly reflected the intentions of
negotiators to leave open the option for Members to take appropriate measures to achieve their policy
objectives in clearly identified areas.  Such measures could however only be taken in so far as they
were consistent with the provisions of the Agreement.  Therefore, a delicate balance of rights and
obligations had been created.  In these circumstan ces, the literal wording of the Agreement was the
maximum that could be expected by way of interests of private right-holders.  There was no scope for
going beyond the literal wording of the Agreement to further the interests of private right-holders.  In
other words, the rights and obligations under the TRIPS Agreement were best performed through
good faith application of its provisions in accordance with established principles of international law
and would not require recourse to the legally imprecise notion of non-violation and situation
complaints.  In conclusion, he proposed that the TRIPS Council recommended to the Fifth Ministerial
Conference that complaints on the grounds of nullif ication or impairment of the type identified in
subparagraphs 1(b) and 1(c) of Article XXIII of GATT 1994 be determined inapplicable to the TRIPS
Agreement.
167. The representative of Switzerland said that his delegation attached great importance to all
issues related to the WTO dispute settlement system and consequently also to the question of non-
violation.  Option one had been suggested by a num ber of Members, including by the co-sponsors of
document IP/C/W/385.  Some of these delegations had argued that non-violation complaints should
not apply to the TRIPS Agreement because of the different nature of this Agreement as compared to
GATT or GATS.  Others had argued that these complaints could simply not occur in the TRIPS
context and were therefore unnecessary.  Switzerland, however, believed that nullification,
impairment or unavailability of benefits based on reasonable expectations could indeed be envisagedunder TRIPS.  Daniel Gervais in his "Analysis of the TRIPS Agreement" had mentioned, for example,
the scenario where, in spite of apparent conformity of a Member's laws and regulations with the
TRIPS Agreement, a systematic refusal to apply cert ain provisions of such laws and regulations might
nullify or impair the benefits accruing under TR IPS.  Furthermore, Article 64.1 of the TRIPS
Agreement provided that the full dispute settlement mechanism negotiated during the Uruguay Roundwas applicable to the Agreement, including non-violation and situation complaints.  The very nature
of any moratorium was to be temporary.  This m eant in the present case that such complaints would
be available following the end of the established term, i.e. five years, in accordance with paragraphs 2
and 3 of Article 64.  The extension of the moratori um in Doha did not change this.  Therefore, his
delegation could not support option one.
168. Considering the little substantive work done by the Council on scope and modalities since the
extension of the moratorium and the little time left for such work before Cancún, it was questionablewhether the mandate given by Ministers in Doha had actually been fulfilled.  He had noted that many
delegations, for the concern of transparency and predictability, did not wish to delegate the
determination of the scope and modalities of such complaints in the TRIPS context to a dispute
settlement panel or declare them applicable before Members had had the opportunity to do further
substantive work on the issue.  In all WTO affairs, Switzerland had always supported an approachwhich would be as much rule-based and transparent as possible.  In this spirit, he could agree to a
recommendation by the Council to the Ministers in Cancún to once more extend the moratorium.
This would allow further discussions among those Members who were still feeling that the rules
established and the experience gained with such complaints in other fields of the WTO were
insufficient.  However, this further work should be intensified, the second extension of themoratorium should be final and a clear deadline would have to be fixed.  Hence, this further extension
of the moratorium should end at the Sixth Ministerial Conference.
169. The representative of Japan, while having some sympathy towards option one, believed that at
this juncture it would be reasonable and practical to support option four and the Canadian suggestion
to set up a strict work programme for future discussions on this issue at the TRIPS Council.IP/C/M/40
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170. The representative of the United States said that it would be entirely appropriate that the
moratorium provided by Article 64.2 of the TRIPS Agreement should be allowed to expire.  The
possibility of non-violation nullification and impairment (NVNI) disputes had been part of the GATT
dispute settlement system since the beginning.  Failure to allow such complaints in connection with
the TRIPS Agreement could invite Members to seek creative ways to avoid their TRIPS obligations.As noted several times in past Council meetings, th e information provided in the Secretariat's paper
on NVNI disputes should allay any fears that expira tion of the moratorium would result in a flood of
disputes claiming non-violation nullification and impairment.  The Secretariat had stated in its
background note that "[t]he protection of legitimate expectations is central to creating security and
predictability in the multilateral trading system".  He  agreed wholeheartedly with this statement.  The
TRIPS Agreement, as part of the multilateral trading system, should provide Members with the same
security and predictability that were available in relation to other WTO agreements.
171. He believed that the benefits accruing to Members under the TRIPS Agreement were as clear
as those deriving from GATT.  The benefits were the national and most-favoured-nation treatment
accorded to each Member's nationals, the level of protection provided to each Member's nationals in
relation to each form of intellectual property covered by the TRIPS Agreement, the availability of
effective and adequate enforcement provisions, and other specific benefits.  Some Members had alsoexpressed concern that the possibility of NVNI cases had the potential to undermine Members'
regulatory authority.  He believed that this concern was unfounded because the TRIPS Agreement
was carefully negotiated to be sufficiently flexible to recognize different legal regimes and to
accommodate Members' needs to achieve policy objec tives.  The availability of  NVNI cases would
merely provide security and predictability to guarantee that the TRIPS Agreement's flexibility was notmisused in order to avoid legitimate obligations.
172. Article 26 of the Dispute Settlement Understanding provided all the necessary assurances and
safeguards for Members to handle any disputes that might arise alleging non-violation nullification
and impairment under the TRIPS Agreement and to prevent any abuse of the dispute settlement
process.  According to Article 64.1 of the TRIPS Agreement, NVNI complaints were applicable to theAgreement.  He said that the position taken by Peru and the co-sponsors of its proposal that NVNI
complaints should not be applicable to the TRI PS Agreement was untenable and directly contrary to
the Agreement.  Hence, the first of the four optio ns being discussed was completely unacceptable and
in contravention of WTO rules.
173. He noted that, despite repeated calls for Members to submit specific proposals concerning the
scope and modalities of NVNI complaints, no delega tion had done so.  The United States was of the
view that sufficient time, over eight years in fact, had already been given to the Council to examinethe scope and modalities for NVNI complaints.  Given these facts, he did not believe that the third or
fourth options were possible, which had led his delegation to the conclusion that the only option that
made sense was the Chairman's second option, i.e. for the TRIPS Council to recommend to the Fifth
Ministerial Conference in Cancún the immediate expiration of the moratorium on NVNI complaints.
174. The representative of the European Communities said that he had noted from the
interventions of the other delegations a clear trend towards a growing consensus around option one
and that only two delegations had expressly rejected it.  Other delegations had merely said that they
would not stand in the way of the first option but because there was no consensus they were looking
for a way out of this deadlock, such as the reco mmendation for the Council to continue to study the
scope and modalities of non-violation and situation complaints.  He could not show sympathy for this
position because a continued study of this matter would mean that the Council would be heading
towards a phase where non-violation and situation complaints would eventually become available
under the TRIPS Agreement.  However, the clear trend towards option one indicated that this was
clearly not the case.  Under these circumstances, he failed to understand why this Council would still
after Cancún continue to spend time on this matter.  Of course, if extending the moratorium was theIP/C/M/40
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only way out, his delegation would have no choice but to  continue this debate.  However, this would
not be a satisfactory outcome of the deliberations of this Council.
175. The Chairman said that although the majority of the delegations that had spoken had
expressed preference for option one, there was no consensus on any of the four options tabled for
discussion.  Therefore, it seemed that he would need to report to the General Council meeting of24 July that the TRIPS Council was not in a position to make recommendations to the Fifth
Ministerial Conference at this stage.  This meant th at further work might need to take place in the
period between the General Council meet ing and the Ministerial Conference.
I. E
LECTRONIC COMMERCE
176. The Chairman recalled that paragraph 34 of the Doha Ministerial Declaration, dealing with
electronic commerce, instructed the General Council to consider the most appropriate institutional
arrangements for handling the Work Programme, and to report on further progress to the Fifth Sessionof the Ministerial Conference.  Pursuant to this, the General Council had agreed at its meeting in
October 2002 to maintain the current institutional arrangements for handling the Work Programme on
Electronic Commerce, namely that the Councils for Trade in Services, Trade in Goods and TRIPS,
and the Committee on Trade and Development would examine and report on aspects of electronic
commerce relevant to their respective areas of competence.  He also recalled that, at the TRIPSCouncil's meeting in March 2002, the Secretariat had been requested to update its factual background
note on intellectual property and electronic commerce circulated in document IP/C/W/128 in February
1999.  This update had now been circulated as Addendum 1 to the aforementioned document.
177. The Secretariat said that the update should be read in conjunction with the original document
IP/C/W/128 since it did not contain the information provided in that original note.  The update
focused on a number of important developments in the international regulatory framework that
concerned certain issues that were already discussed in the original document.  The update also briefly
summarized the relevant work carried out by the WTO since the launch of the Work Programme.  It
also provided information on work carried out by other intergovernmental organizations, in particular
WIPO.  WIPO had recently published a comprehensive survey on this issue, as well as otherdocumentation.  For the benefit of those delegations that wished to look into WIPO's work in more
depth, these documents had been referred to in the update.
178. Turning to the report that the Council was to submit to the General Council, the Chairman
suggested that the Council request the Secretariat to draft a brief factual report summarizing the
Council's recent work on this topic, including refere nces to the relevant parts of the minutes of the
meetings where this item had been discussed and references to any documents submitted to the
Council.  He suggested that the Council adopt the report ad referendum , namely that Members would
have five days to comment on the draft report once the Secretariat had made it available to them, and
if there were no major substantive comments on it, the report would then be forwarded to the General
Council.
179. The representative of Switzerland thanked the Secretariat for the updated document and said
that it would help to refuel the Council's discussi on on this important topic and help delegations to be
better prepared for the next Council session, when there might be more time to deal with this agenda
item.  As to the procedure for the adoption of th e report to the General Council, he supported the
Chairman's proposal.
180. The Council took note of the statement and agreed  to proceed as suggested by the Chairman.IP/C/M/40
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J. REVIEW OF THE APPLICATION OF THE PROVISIONS OF THE SECTION ON GEOGRAPHICAL
INDICATIONS UNDER ARTICLE 24.2
181. The Chairman recalled that Article 24.2 of the TRIPS Agreement provided that the Council
shall keep under review the application of the provisions of the Section on geographical indications,
and that the first such review shall take place wi thin two years of the entry into force of the WTO
Agreement.  At the Council's last formal meeting, the previous Chairman had concluded the
discussions under this agenda item by saying that he would convey to the new Chairman the interest
expressed by some delegations to have a more structured discussion on this item, and that he would
ask the new Chairman to consult Members to see what  their thinking was in this regard.  Accordingly,
this matter was discussed at the Council's informal meeting on 23 May.  A suggestion made by a
number of delegations at that meeting was to request the Secretariat to update its summary note
contained in document IP/C/W/253.  It was also suggested that those Members that had not yetresponded to the underlying questionnaire should be requested to do so.  In this regard, the Chairman
recalled that a checklist of questions had been circulated in May 1998 in document IP/C/13 and
Addendum 1, which sought information on the way Members provided protection for geographical
indications.  At its meeting in March 2002, the Council had urged those Members that had not yet
provided responses to the questionnaire to do so.  To date, the Council had received information from44 Members in response to the questionnaire.  Those responses that were received prior to April 2001,
were summarized in a Secretariat note contained in document IP/C/W/253.  Furthermore, the
Chairman noted that a number of other ideas were presented at the aforementioned informal meeting.
182. The representative of Australia said that for some time his delegation had been keen to
encourage more informed discussions on geographical indications in the TRIPS Council.  The review
under Article 24.2 was a useful way to carry forward this work.  In his view, a range of additional
information could come out of this kind of discus sion, such as how many Members had implemented
their existing obligations under the TRIPS Agreement;  how they had implemented those obligations
under the distinct levels of protection under Arti cles 22 and 23;  what problems did Members
encounter when implementing these provisions;  and what were some practical examples of GIprotection.  The point of such an exercise would not be to single out any particular delegation, but
rather to seek an overall picture of the implementation, the problems Members were experiencing and
a sense of the costs and benefits stemming from the Uruguay Round Agreement.  He believed that it
was important to have a structured discussion under the Article 24.2 review and supported the kind of
approach set out by the Chairman in his introductory comments, in particular the preparation of an
update of document IP/C/W/253 to reflect the most recent responses.  It could also be useful if the
Secretariat would send another reminder to delegations to respond to the checklist of questions thatwas first distributed in 1998, since only 44 Members had responded to that survey so far.  He
wondered whether, in the longer term, the inform ation that was already available to the Council
through the regular notification process could be used to build a more complete picture of how
Section 3 of Part 2 of the Agreement had been implemented.
183. The representative of the United States said that, during the discussion on Article 24.2, his
delegation had indicated that it believed that the Council should follow the excellent proposal made
by Australia to "walk through" the provisions on geographical indications, paragraph by paragraph.
Were all Members to provide responses to the checklist of questions on geographical indications, the
Council would be provided with a more complete picture of the variety of ways in which Members
had implemented their obligations with respect to geographical indications and, therefore, wouldmake such a walkthrough more meaningful.  In this regard, he was particularly interested to see how
countries had ensured that protection was available for nationals of other Members to protect their
geographical indications, since not all Members yet did so.
184. The representative of the European Communities said that, when it was proposed last year
that the Council move towards a more structured disc ussion with regard to the Article 24.2 review, his
delegation did not stand in the way of that proposal.  At the same time, Australia had volunteered toIP/C/M/40
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participate in the debate by explaining how it had implemented its relevant obligations.  In the spirit
of cooperation, his delegation had submitted some questions to the Australian delegation, but he
regretted to say that up to date his delegation had not received any responses from Australia.  He
hoped that Australia would still provide such responses.
185. The representative of Australia said that his delegation had made clear that it saw the
Article 24.2 review as a positive opportunity to build up experience and information on
implementation.  In that spirit, Australia had submitted a paper which set out how it had fulfilled its
obligations under Section 3 of Part II of the Agreem ent.  In doing so, Australia had addressed a very
substantial number of the 253 questions posed by the European Communities and referred to a
number of documents that provided more than adequate explanations and answers to those questions.
The representative of the European Communities asked whether the Australian delegation intended to
provide responses to each of the questions his delegation had posed to it or whether his delegation
would have to assume that the documents to which Australia had referred comprised answers to these
questions.  The representative of Australia responded that the answers to all the questions posed by
the European Communities, and to any follow-up quest ions it still might have, had been answered in
the paper his delegation had submitted to the Council as well as in the range of legislation and website
addresses referred to in this context.  The representative of the European Communities said that his
delegation was not satisfied with the way Australia had responded to its questions.
186. The Chairman proposed that the Council request the Secretariat to update its summary note in
IP/C/W/253 to take into account the information r eceived from Members in response to the checklist
of questions since the circulation of that note and invite those Members that had not yet provided such
information in response to the checklist to do so.
187. The Council so agreed.
K. TECHNICAL COOPERATION AND CAPACITY -BUILDING
- Annual Updates on Technical Cooperation
188. The Chairman recalled that the Council had traditionally undertaken its annual review of
technical cooperation at its September meeting.  He suggested that the Council once more invite
developed country Members to supply information on their activities pursuant to Article 67 of the
TRIPS Agreement. Other Members who also made available technical cooperation could also be
encouraged to share information on these activities if they so wished.  He also suggested that once
more the Council invite those intergovernmental organizations that had observer status in the TRIPS
Council to provide information on their activities of relevance and, further, that the WTO Secretariat
be also instructed to report on its activities.  Given that this year the Council had not scheduled a
meeting for September, he suggested that this information be provided in time for the Council's
meeting scheduled for 18-21 November.  In order to allow its timely circulation before the meeting,
he suggested that the Council request this information to be made available by the end of October.
189. The Council so agreed.
- Joint Initiative
190. The Chairman recalled that, the WIPO and WTO Secretariats had launched on a Joint
Initiative on Technical Cooperation for Least-Developed Countries on 14 June 2001.  Since then, the
WTO Secretariat had kept the Council informed about the implementation of this initiative.
191. The Secretariat said that, under the Joint Initiative, the WIPO and the WTO Secretariats had
organized, in cooperation with the relevant national authorities, joint national seminars in Cotonou,
Benin, on 18-19 March and in Bamako, Mali, on 24-25 March.  These national seminars were part ofIP/C/M/40
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the WTO technical assistance plan.  He took the opportunity to thank the authorities of Benin and
Mali, as well as the International Bureau of WIPO, for cooperation in these events.  The two
Secretariats were discussing the organization of other national workshops or seminars in the coming
months to respond to other requests that had been made for technical assistance within the framework
of the Joint Initiative, taking account, of course, of their human resources constraints, especially in the
period running up to the Ministerial Conference at Cancún.
192. The representative of WIPO thanked the Governments of Benin and Mali for hosting the
national seminars referred to by the WTO Secretariat.
L. INFORMATION ON RELEVANT DEVELOPMENTS ELSEWHERE IN THE WTO
- Accessions
193. The Chairman said that the Former Yugoslav Republic of Macedonia had become the 146th
Member of the WTO on 4 April 2003.  In paragraph 238 of the Report of the Working Party on the
Accession of the FYR of Macedonia (WT/ACC/807/27), the representative of the FYR of Macedonia
had confirmed that his Government would apply fully all the provisions of the TRIPS Agreement
from the date of accession to the WTO, without recourse to any transitional period.  This commitment
had been incorporated in paragraph 2 of the Protocol of Accession of the FYR of Macedonia to the
WTO (document WT/L/494).
- Dispute Settlement
194. The Chairman said that, by means of a communication, dated 4 April 2003, the United States
had requested additional consultations with the European Communities regarding the protection of
trademarks and geographical indications for agricultural products and foodstuffs (IP/D/19/Add.1).
The United States had indicated that this request was intended to supplement but not to replace anearlier request for consultations with the European Communities, dated 1 June 1999 (IP/D/19).  Since
the US request for additional consultations, the following Members had requested to join the
consultations:  Australia, Mexico, New Zealand, Sri Lanka, India, Argentina, Hungary, Malta,
Bulgaria, the Czech Republic, Cyprus, Slovenia, Turkey, Romania and the Slovak Republic
(WT/DS174/4-18).
195. By means of a communication, dated 17 April 2003, Australia had requested consultations
with the European Communities regarding protecti on of trademarks and geographical indications for
agricultural products and foodstuffs (IP/D/25).  The following Members had requested to join these
consultations:  Malta, Bulgaria, the Czech Republic, Cyprus, the United States, Slovenia, New
Zealand, Turkey, Mexico, Argentina, Hungary, Colo mbia, Romania, the Slovak Republic and Chinese
Taipei (WT/DS290/2-16).
M. O
BSERVER STATUS FOR INTERNATIONAL INTERGOVERNMENTAL ORGANIZATIONS
196. The Chairman said that the list of the 16 pending requests for observer status in the TRIPS
Council by other intergovernmental organizations was contained in document IP/C/W/52/Rev.10.  He
recalled that the Council had discussed these pending requests at its previous meetings, but had not
been able to reach consensus on any of them.
197. The representative of Brazil said that, at its recent meeting, the Committee on Trade and
Environment (CTE) had adopted a groundbreaking decision to invite the secretariats of certain
multilateral agreements to participate on an ad hoc  basis in the work it was pursuing under the Doha
Ministerial Declaration.  He believed that this decision had set an important precedent and that it was
an example that could be followed in other bodies that were currently undertaking work pursuant to
the Doha Ministerial Declaration in the context of the Doha Development Round.  The TRIPSIP/C/M/40
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Council had a clear mandate under paragraph 19 to deal with the issue of the relationship between the
TRIPS Agreement and the Convention on Biological Diversity (CBD).  It was therefore of utmost
importance that the Council grant observer status to the CBD Secretariat to enable it to participate in
the Council's work.  Given the precedent-setting decision by the CTE, the Council should agree on a
similar ad hoc  arrangement to grant observer status to the CBD Secretariat.
198. The representative of India said that there was a specific mandate given by Ministers in
paragraph 19 of the Doha Declaration, which instructed the Council, inter alia , to examine the
relationship between the TRIPS Agreement and the CBD.  It would be quite natural for the CBD
Secretariat to participate in these discussions.  The Council was currently being deprived of useful
technical input from the very organization that administered the agreement, the relationship of which
with the TRIPS Agreement was being examined.  Since the granting of observer status had been in
abeyance for a long time, the Council should consider some ad hoc  arrangement in the interim to
allow the participation of the CBD Secretariat in these discussions.  Since, as mentioned by Brazil,
similar arrangements had been made in some other WTO bodies, India was of the opinion that an
arrangement on the same lines should also be made for the participation of the CBD Secretariat in the
TRIPS Council.
199. The representative of Peru supported the interventions made by India and Brazil and their
request to grant observer status to the CBD Secretariat.
200. The representative of the United States said that his delegation could not support the granting
of observer status to the CBD Secretariat.  In the past, the Unites States had supported the granting of
observer status to organizations with a broad interest in the TRIPS Agreement, such as ARIPO and
OAPI.  On the other hand, the CBD Secretariat had an interest in only one sub-paragraph of theTRIPS Agreement.  He recalled that the CTE had admitted the secretariats of certain MEAs as
invitees to the Special Session only, and it was his understanding that the CTE discussion was not
intended to affect the broader question pending in the General Council.
201. The Chairman noted that there was no consensus on granting observer status to the CBD in
the TRIPS Council.
202. The Council took note of the statements.
N. SPECIAL AND DIFFERENTIAL TREATMENT PROPOSALS REFERRED TO THE COUNCIL
203. The Chairman said that he had received a letter, dated 20 May 2003, from the Chair of the
General Council, in which he had recalled the mandate he had received from the General Council to
undertake consultations, in coordination with the Chairman of the Committee on Trade and
Development in Special Session, on how to move fo rward the review of all special and differential
treatment provisions.  In this letter, he had explained that, in pursuance of that mandate, he hadundertaken consultations on a possible approach to the work on special and differential treatment, and
subsequently on 7 April 2003 circulated document JOB(03)/68 which had outlined his proposed
approach for addressing the agreement-specific proposals on special and differential treatment
provisions.  An important element of that approach was an informal grouping of the 88 agreement-
specific proposals into three categories.  Category II of the list comprised agreement-specificproposals which he had proposed to be addressed by relevant WTO bodies.  In accordance with his
statement to Members at the General Council meeting of 15 May 2003, the two proposals relating toIP/C/M/40
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the TRIPS Agreement had been referred to the TRIPS Council.2  Accordingly, the TRIPS Council had
been asked to consider these proposals as soon as possible, and to report to the last meeting of the
General Council before the Cancún Ministerial Conference on the status of the proposals and the
progress made in this regard.
- Comments on the proposal by the LDCs
204. The representative of the United States said that Article 66.1 currently provided an effective
procedure for extending the transition periods of least-developed countries even further.  As
demonstrated at Doha in November 2001, the swift extension of the transition period for LDCs with
respect to the requirement to provide product patent protection for pharmaceuticals by an additional
10 years, until 2016, provided a perfect example of why the existing provision was fully capable of
addressing Members' concerns.
205. He strongly believed that the implementation of the TRIPS Agreement would help LDCs to
establish a viable technological base.  He feared that the proposal by LDCs could have the unintended
effect of removing the incentive to implement the TRIPS Agreement by allowing a country without a
viable technological base to indefinitely postpone TRIPS implementation.  He said that intellectual
property protection was a necessary and important ingredient in establishing a sound investment
climate, one that would attract technology transfer  and stimulate domestic creativity and innovation.
While recognizing the good intentions behind the LDC proposal, he believed that it would actually be
counter-productive by further delaying the development of a viable technological base, and, therefore,
it could not be supported by the United States.
                                                     
2 The proposals were the following:
Article 66.1
Proposal by the LDCs  - TN/CTD/W/4/Add.1
If at the end of the transition period the least-developed Member has not established a viable
technological base, a further extension of transition period shall be automatically granted by the TRIPS Councilon request by the least-developed Member.  Where any other Member is opposed to the extension, it shall reston that Member to show that the objective of the transition period has been met for that least-developed
Member.
Articles 65, 66.1, 70.8 and 70.9
Proposal by the African Group  - TN/CTD/W/3/Rev.2
(a) It is understood that developing country Members shall be entitled to extensions beyond the additional
5 year period under Article 65.4 relating to other areas of technology required to be protected under theTRIPS Agreement.
(b) For purposes of the requirement to grant exclusive marketing rights during transition periods, it is
understood that there is a clear distinction between "patent rights" on the one hand and "exclusive
marketing rights" on the other.  The two shall not confer the same rights. Patent rights as set out inArticle 28 of the TRIPS Agreement are the following: "to prevent third parties not having the owner'sconsent from the acts of making, using, offering for sale, selling, or importing for these purposes the(patented) product" as well as the products obtaine d directly by the patented process. These rights
conferred by a patent, are not the same rights as may be conferred by the grant of exclusive marketing
rights.  Members have the right and the freedom to define what constitutes exclusive marketing rights,
and may do so in light of any interpretations that the General Council or the TRIPS Council may adopt.It is understood also that there is no requirement to grant exclusive marketing rights until and only ifmarketing approval is granted.IP/C/M/40
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206. The representative of Canada said that, although he recognized that LDC Members had
difficulties in fully implementing their TRIPS obligations, he could not support the LDC proposal.
Canada and other developed country Members were working together with LDCs to help them
overcome these difficulties.  The implementation of the minimum level of IP protection identified in
the TRIPS Agreement would be a fundamental element to improve LDCs' economies, attractinvestments, improve their technological bases and be generally beneficial for their development.
Canada believed that it was important for LDCs to work towards a specific deadline for implementing
TRIPS obligations and, therefore, could not support an open-ended extension of the implementation
period.  Nevertheless, Canada recognized that Members were at different stages of development and
that was the reason why it had readily supported the extension for LDC Members to implement their
obligations in relation to pharmaceutical products an d why it had provided technical assistance to help
LDC Members meet these obligations.  It should be noted that Article 66.1 already contained amandatory obligation to examine duly motivated requ ests by LDCs for extensions of their transition
periods.
207. The representative of Switzerland said that his delegation could not support the LDC proposal
because Article 66.1 of the TRIPS Agreement was one of the S&D provisions in the WTO
Agreements which fully took into account specific needs of LDCs for special and differentialtreatment as regards these rights and obligations under the Agreement.  Not only a fixed ten-year
period was provided, but an LDC could at the time of the expiry of this period request its extension.
No specific requirements had been established on which an extension would depend.  The proposed
provision which would automatically grant an open-ended extension of transitional periods did not
seem to take into account the elements of this specific case.  In consequence, the proposed provisionappeared to take away the incentives for LDCs to bring their legal framework into compliance with
the TRIPS Agreement, while it also discriminated against those who had already undertaken
considerable and commendable efforts to do so in order to create a favourable environment for direct
investment and technology transfer.
208. The representative of Australia said that it was difficult for her to support the proposal by
LDCs in its current form.  Her authorities would be interested to know what would be the criteria that
would be used to demonstrate whether a viable technological base had or had not been established.
She added that in some specific circumstances so me value could exist in extending transitional
periods, in respect of pharmaceutical patents.
209. The representative of Kenya said that his delegation supported the LDCs proposal because it
was based on a clear and solid objective criteria, i.e. whether at the end of the transitional period a
least-developed Member had established a viab le technological base.  The TRIPS Agreement
promised transfer of technology, but how much technology had been transferred since TRIPS came
into force?
210. The representative of Egypt said that his delegation supported the proposal by the LDCs.  He
also reminded Members of paragraph 7 of the Doha  Declaration on TRIPS and Public Health, where it
was clearly stated that the extension that this Council had provided to LDCs until the end of 2016 waswithout prejudice to their right to seek other extensions of the transition period as provided for in
Article 66.1 of the TRIPS Agreement.
211. The representative of Norway said that his delegation had a positive attitude towards an
extension of the obligation under Article 66.1, but it doubted whether the proposal sufficiently took
into account the procedure under Article 66.1 and, in particular, whether it satisfied the requirement ofthe last sentence of Article 66.1.  He said that he needed to reflect further on this issue.
212. The representative of Japan said that it was difficult for him to support the LDC proposal,
because an open-ended extension of the transition period under Article 66.1 could lead to the loss of
momentum to prepare the implementation within the prescribed period.IP/C/M/40
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213. The representatives of Argentina and Cuba  said that they supported the LDC proposal
because it had an objective criterion, i.e. the creation of a viable technological base, and because it
contained a specific extension period which would be granted based on a formal petition by the
interested LDC Member.
- The proposal of the African Group
214. Introducing the proposal of the African Group, the representative of Kenya said that the
proposal had two parts.  The first part was on the extension of the additional period under
Article 65.4.  The second had two elements, namely, patent rights and exclusive marketing rights.
Given that there was often some overlap or confusion between patent rights and exclusive marketing
rights, there was a need to distinguish the two.  The proposal suggested that Members should have the
freedom to define what constituted exclusive marketing rights and clarify when they should become
effective, i.e. after a marketing approval had been granted.
215. The representative of the United States said that his delegation had serious reservations about
the proposal by the African Group, for several reasons.  First, with respect to paragraph (a) of the
proposal, he believed that the existing transiti on period under Article 65.4 already provided a more
than adequate period of time for developing country Members to implement product patent protection
for those areas of technology that were not protected when TRIPS came into force.  There was noevidence to suggest that developing country Members who had implemented product patent
protection, i.e., the vast majority of developing country Members, had suffered as a result of this.  In
fact, the evidence showed that benefits had clearly accrued to these Members.  Furthermore, his
delegation believed that a prolonged transition period under Article 65.4 would discourage those
developing country Members that had not yet done so from implementing product patent protection incertain important technologies.  This, could have the effect of impeding the growth of these
innovative industries in those Members and undermine economic development.  Additionally,
extended transition periods would also run contrary to the objectives of the multilateral trading
system, which was to remove barriers to trade, including non-tariff barriers such as the lack of
adequate and effective intellectual property protection.
216. With respect to paragraph (b) of the proposal, he said that Article 1.1 of the TRIPS
Agreement already provided that Members were free to determine the appropriate method of
implementing the provisions of the Agreement, incl uding exclusive marketing rights, within their own
legal system and practice.  However, Members must implement such rights in a manner which would
be consistent with Article 70.9, which clearly established the requirements under this obligation.
Therefore, Members were not free to apply interpretations to this obligation that would be contrary to
the clear meaning of the text.  Exclusive marketing rights, by definition, meant that the right wasexclusive;  i.e., only the beneficiary of the right could exercise it.  This necessarily meant that only the
beneficiary would have the right to market the product during the prescribed period.  This period,
according to Article 70.9, was five years after marketing approval had been granted in the relevant
Member or until a patent had been granted or rejected in that Member, whichever period was shorter,
under the terms spelled out in Article 70.9.  The obligation to provide exclusive marketing rights waspart of the negotiated balance of the TRIPS Agreement and had to be respected as such.  They were
meant to compensate innovators for the lack of product patent protection in those few Members that
did not have such protection at the time of entry into force of the TRIPS Agreement.  Exclusive
marketing rights were provided for as a compromise instead of the full "pipeline" protection that was
sought by several countries, including the United States.
217. He said that the United States and other Members had already shown significant flexibility on
this issue in agreeing to waive the obligation to provide exclusive marketing rights under Article 70.9
for LDCs until 2016.  It was, therefore, incumbent upon those developing countries to which it
applied to implement Article 70.9 as provided for in that provision.  He added that he was interestedIP/C/M/40
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in continuing the discussion on these issues, in particular with the African Group, to see if an
acceptable way forward could be found.
218. The representative of India supported the proposal by the African Group. He believed that
what the African Group had proposed in paragraph (b) was somewhat different from what the United
States had understood it to be.  What the African Gr oup was trying to address in its proposal was what
was the definition of, and what constituted, exclusive marketing rights, and what kind of rights the
holder of those rights would get.  These were relevant questions since Article 70.9 did not define, for
example, the difference between the rights conferred by patents and the rights conferred by the
exclusive marketing rights.
219. The representative of the European Communities said that, as regards paragraph (a) of the
proposal, his delegation was under the impression that only a few Members were benefiting currently
from the transition period provided under Article 65.4.  If this was so, he wondered why this proposalhad been made.  He asked the Secretariat to provide the Council with some information on the current
use of the transition period under Article 65.4.
220. As to paragraph (b) of the proposal, he said that this was quite an interesting approach and
that his delegation would be ready to explore it further.  In his view, exclusive marketing rights were
not the same as patent rights.  Since the TRIPS Agreement was not as detailed and prescriptive onexclusive marketing right as it was on patents, one could certainly conclude that Members could have
a greater flexibility in the implementation of the former.
221. The representative of Malaysia supported the proposal of the African Group.  As to
paragraph (a), she agreed that there could be extensions provided that they would not be automatic.  In
this case, the developing country concerned would still need to justify its case before the TRIPSCouncil and her delegation would be willing to accep t such an extension if the case would justify it.
222. As to paragraph (b) of the proposal, she agre ed with the European Commission's statement
that there were differences between patent rights a nd exclusive marketing rights.  Consequently, in the
absence of a definition of the latter, her delegation agreed with what was stated in proposal (b) when it
said that Members had the right and freedom to define what exclusive marketing rights were whenimplementing the relevant TRIPS provisions on this matter.
223. The representative of Argentina said that her delegation supported the African Group's
proposal.  It was evident that patent rights were not equal to exclusive marketing rights and that
Members were free to define the latter.
224. The representative of China said that she believed that patent rights were different from
exclusive marketing rights and joined the European  Communities in asking the Secretariat to provide
the Council information on how many Members were still benefiting from the transition period underArticle 65.4.
225. The Secretariat said that it was not possible to give any sort of exhaustive response to this
question at this point.  At one time, the Secretariat had a list of about 13 Members who, according to
the information available, were invoking or us ing or benefiting from Article 65.4.  Currently,
however, the Secretariat did not have complete information in this regard.  Furthermore, there were afew other countries in respect of which it was not entirely clear whether they were benefiting from
Article 65.4.  Therefore, the list of 13 Members was not necessarily exhaustive.  He noted that since
that time quite a significant proportion of those 13 Members had introduced product patent protection
for the products in question, according to the info rmation that they had provided to the Council.
Consequently, there was a relatively limited number of countries who continued to use Article 65.4.IP/C/M/40
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226.  The Chairman said that, at this stage, there did not appear to be a consensus on the proposals
by the LDCs and the African Group.  Given that some delegations had expressed willingness to
engage in consultations at least on the African proposal, he suggested that the Council revert to the
matter later in the course of the present meeting.
227. Reverting to the matter later in the course of  the meeting, the representative of Kenya said
that his delegation and some others from the African Group had met with the delegation of the
United States to discuss the African proposal.  The African Group would still need to consider
whether it could agree on the text proposed by the United States.  He asked that the issue be put on
hold for a few more days so as to allow them more time to reach a solution.
228. The representative of the United States thanked the African Group for meeting with his
delegation and for working in a constructive manner on the counter-proposal that was put forward by
a number of delegations.  He hoped that they could work something out in the near future.
229. Noting that the Council was not in a position to conclude its work on these matters during the
present meeting, the Chairman encouraged Members to continue their mutual dialogue on the matter
and to report back to him.  He suggested that  the Council authorize him to report on the further
consultations to the General Council in advance of  its meeting of 24 July on his own responsibility,
i.e. without the need to call another formal m eeting of the Council, it being understood that all
Members would have an opportunity to participate in the formulation of his report.
230. The representatives of India and Switzerland  said that their delegations would like to
participate in any future informal consultations on this matter.
231. The Council agreed to proceed as suggested by the Chairman.
O. UPDATE TO THE ANNUAL REPORT TO THE GENERAL COUNCIL
232. The Chairman recalled that the General Council, at its meeting on 10 February 2003, had
taken up the question of the preparation of the annual report that the General Council was to submit to
the Cancún Ministerial Conference.  It had been ag reed that the General Council would submit to the
Ministerial Conference a brief update to its annual report for 2002, which would describe
developments since December 2002.  The Chair had clarified that this meant only the routine annualreports of a factual nature that all WTO bodies were required to make under existing procedures, and
not any specific reports that Ministers at Doha had requested to be submitted to them.  The Ministerial
Conference would therefore have before it, as the annual report of the General Council, a compilation
of the 2002 Annual Reports of all the WTO bodies, together with an updated report concerning
developments in 2003.
233. Pursuant to this, the Chairman suggested that  the Council ask the Secretariat to prepare an
update to the TRIPS Council's Annual Report for 2002 that would cover the Council's work so far thisyear so far.  He suggested that the Council adopt the report ad referendum , namely that Members
would have a week to comment on the draft report once the Secretariat had made it available to them,
and if there were no major substantive comments on it, the report would be forwarded to the General
Council.
234. The Council so agreed.IP/C/M/40
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P. OTHER BUSINESS
- Updates of reports on the implementation of Article 66.2
235. The Chairman recalled that, at its last meeting, the Council had adopted a decision on the
"Implementation of Article 66.2 of the TRIPS Agreemen t".  Paragraph 1 of the Decision provided that
developed country Members shall submit annually reports on actions taken or planned in pursuance oftheir commitments under Article 66.2.  To this end, they must provide new detailed reports every third
year and, in the intervening years, provide updates to their most recent reports.  These reports must be
submitted prior to the last Council meeting scheduled for the year in question.  Paragraph 3 of the
Decision determined the information that must be provided in these reports.  The Decision was
adopted on the basis that the first set of new detailed annual reports to be presented under it be
submitted at the end of 2003.  It was noted that many Members had already submitted detailed reports
in the autumn of 2002, and that it was expected that those reports be updated and revised in light ofthe Decision.  Furthermore, paragraph 2 of the Decision provided that the submissions shall be
reviewed by the Council at its end-of-year meeting each year.  The review meetings shall provide
Members with an opportunity to pose questions in relation to the information submitted and request
additional information;  discuss the effectivene ss of the incentives provided in promoting and
encouraging technology transfer to least-developed country Members in order to enable them to createa sound and viable technological base;  and consider any points relating to the operation of the
reporting procedure established by the Decision.
236. Accordingly, he suggested that developed country Members be requested to submit reports on
actions they had taken or planned in pursuance of their commitments under Article 66.2 by the end of
October, in order to allow their timely circulatio n and review at the Council's meeting in November.
237. The Council so agreed.
- Arrangements for the reviews of Armenia and the Former Yugoslav Republic of
Macedonia
238. The Chairman said that, as the Council had been informed at its previous meeting and earlier
in the course of this meeting, Armenia and the Former Yugoslav Republic of Macedonia had recently
acceded to the WTO and were not applying any transitional period in the area of TRIPS.  The Council
had not yet received the required notifications of their legislation.  He suggested that the Council
request the Secretariat to remind these new Members of their notification obligations.  Given that,
after the receipt of the notifications, Members would need some time to prepare questions to be posed
to these Members in the context of their review , and that these Members would need some time to
prepare their responses, it would appear that the most appropriate time for the reviews of TRIPS
implementing legislation of these two Members would be the Council's first meeting in 2004.  If thiswere agreeable, he suggested that the Council come  back to the arrangements for these reviews, in
particular the deadlines for questions and responses, at the Council's next meeting.
239. The Council so agreed.
- Transitional review under Section 18 of th e Protocol on the Accession of the People's
Republic of China
240. The Chairman reminded the Council that paragraph 18 of China's Protocol of Accession
required the TRIPS Council to review the implementation by China of the TRIPS Agreement each
year for eight years.  He recalled that the Council had taken up the first review under paragraph 18 at
its meeting in September 2002 in combination with its normal review of China's TRIPS implementing
legislation.  Paragraph 18 required the Council to take up the second review at its next meeting inNovember.  He further recalled that paragraph 18 required China to provide relevant information,IP/C/M/40
Page 46
including information specified in Annex 1A, to the TRIPS Council in advance of the review.  In
accordance with paragraph VI of Annex 1A to the Protocol of Accession, China should notify the
Council of any amendments to copyright, trademark and patent law, as well as relevant implementing
rules covering different areas of the TRIPS Agreement bringing all such measures into full
compliance with and full application of the TRIPS Agreement and the protection of undisclosedinformation.  It should also provide information on enhanced IPR enforcement efforts through the
application of more effective administrative sanctions, as described in the Report of the Working
Party on the Accession of China.  The Council was required to report the results of such review
promptly to the General Council.  He suggested th at the Council take note of this information and
come back to the issue at its next meeting.
241. The Council so agreed.
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