RESTRICTEDWORLD TRADE
ORGANIZATIONIP/C/M/37/Add.1
8 November 2002
(02-6169)
Council for Trade-Related Aspects
of Intellectual Property Rights
MINUTES OF MEETING
Held in the Centre William Rappard
on 17-19 September 2002
Addendum
Chairman:  Ambassador Eduardo Pérez Motta (Mexico)
The present document contains the record of the discussion which took place on agenda
items A, B and D-P during the TRIPS Council meeting held on 17-19 September 2002.  The
discussion on item C concerning paragraph 6 of the Doha Declaration on the TRIPS Agreement and
Public Health is recorded in document IP/C/M/37.
Subjects discussed     Page Nos
A. N OTIFICATIONS UNDER PROVISIONS OF THE AGREEMENT ........................................................2
B. R EVIEW OF NATIONAL IMPLEMENTING LEGISLATION ...............................................................2
D. I SSUES RELATED TO THE EXTENSION OF THE PROTECTION OF GEOGRAPHICAL
INDICATIONS PROVIDED FOR IN ARTICLE 23 T O PRODUCTS OTHER THAN WINES
AND SPIRITS ..............................................................................................................................1 9
E. R EVIEW OF THE PROVISIONS OF ARTICLE 27.3(B)..................................................................44
F. R ELATIONSHIP BETWEEN THE TRIPS A GREEMENT AND THE CBD........................................52
G. P ROTECTION OF TRADITIONAL KNOWLEDGE AND FOLKLORE ................................................58
H. R EVIEW OF THE IMPLEMENTATION OF THE AGREEMENT UNDER ARTICLE 71.1....................62
I. I MPLEMENTATION OF ARTICLE 66.2.........................................................................................62
J. N ON-VIOLATION AND SITUATION COMPLAINTS ......................................................................63
K. E LECTRONIC COMMERCE ..........................................................................................................68
L. O THER OUTSTANDING IMPLEMENTATION ISSUES (TIRETS  93 A ND 94 A ND PROPOSAL
BY LDCS ON THEIR TRANSITION PERIOD )................................................................................69
M. R EVIEW OF THE APPLICATION OF THE PROVISIONS OF THE SECTION ON
GEOGRAPHICAL INDICATIONS UNDER ARTICLE 24.2...............................................................69
N. T ECHNICAL COOPERATION AND CAPACITY -BUILDING ............................................................71
O. I NFORMATION ON RELEVANT DEVELOPMENTS ELSEWHERE IN THE WTO..............................74
P. O BSERVER STATUS FOR INTERNATIONAL INTERGOVERNMENTAL ORGANIZATIONS ..............74
ANNEX .......................................................................................................................... .......................77IP/C/M/37/Add.1
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.  The note showed  from which of the Members in
question notifications had been received by 9 September 2002.  Since then, additional notifications of
laws and regulations had been received from Thailand and Cuba.  From the 79 Members in question,
there were seven who had not yet submitted any notification concerning their implementing
legislation.  Notifications from a number of other Members were incomplete.  Recalling that pursuant
to Article 63.2 of the TRIPS Agreement the notifications of the laws and regulations in question were
generally due as of 1 January 2000, he once again urged these Members to submit the outstandingmaterial without delay.  He also urged them, if not all the material to be notified was ready yet, to
submit whatever could be notified now and complement the notification as soon as other parts of the
material to be notified were ready for submission.  He reminded delegations that, under the
WTO/WIPO Cooperation Agreement and decision s taken by WIPO's Governing Bodies, the
International Bureau of WIPO was in a position to assist delegations with the translation of their maindedicated intellectual property laws and regulations, as required.
- Notifications from other Members and notifications of amendments of laws
notified earlier
2. The Chairman informed the Council that, since its previous meeting, notifications of either
new legislation or amendments to legislation notified earlier had been received from China;  the
Czech Republic;  Germany;  Grenada;  Guatemala;   Hong Kong, China;  Lithuania;  Luxembourg;
Morocco;  the Philippines;  Spain; and Switzerland.  These notifications would be available in the
IP/N/1 - series of documents.
(ii) Notifications under Article 69
3. The Chairman informed the Council that, since the previous meeting, new notifications of
contact points under Article 69 of the TRIPS Agreement had been received from Angola and China,
as well as updated information from Bangladesh, Canada and Chinese Taipei (subsequently circulated
as document IP/N/3/Rev.6/Add.2.).  There were now  117 Members who had notified contact points
under Article 69.
B. REVIEW OF NATIONAL IMPLEMENTING LEGISLATION
(i) Follow-up to reviews already undertaken
4. The Chairman recalled that, as requested by the Council at its meeting in June 2002, the
Secretariat had circulated an informal note in document JOB(02)/108 that listed all the outstanding
material required to complete reviews that the Council had already undertaken.  The table attached to
the note listed those Members whose reviews were 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
the outstanding material.  In addition, the note also listed a number of Members whose reviews hadalready been deleted from the Council's agenda, but to whom further questions had been posed.
5. He said that Malaysia and Oman had now provided responses to all of the questions posed to
them.  He proposed that the reviews of the legislation of Malaysia and Oman be deleted from theIP/C/M/37/Add.1
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agenda, it being understood that any delegation should feel free to revert to any matter stemming from
these reviews at any time.
6. The Council so agreed.
7. The Chairman said that the table indicated that there were 21 Members whose reviews had
been initiated between April 2001 and June 2002 that had not yet been completed.  The table referred
to submissions received before 4 September 2002.  Since then, the Secretariat had received responses
to all outstanding questions posed to Guyana (subsequently circulated in document IP/C/W/381).
Suriname was in the process of submitting information on the status of preparation of its TRIPS
implementation.  This information would be circulated to the Council once it became available.
8. The Chairman recalled that, at the Council's previous meeting, the representative of Mauritius
had said that the questions concerning the legislation of Mauritius raised by a number of delegations
had been all related to Mauritius' old laws.  He had informed the Council that his delegation had hadextensive consultations with these delegations, and that all the issues that had been raised by them had
been factored in the new draft legislation, which was at that time before Parliament.  Finally, he had
expressed his hope that this explanation would set to rest the questions raised and that the matter
could be closed once the new laws had been circulated to Members.  The Chairman requested that the
delegations that had posed questions to Mauritius to indicate whether they were satisfied with thisexplanation and that the review could be deleted from the Council's agenda, or whether they still
preferred to get responses to the questions they had posed, or whether they preferred to revert to the
matter once the new legislation had been notified and circulated to Members.
9. The representatives of the United States, Canada
 and Switzerland  requested Mauritius to
respond the questions posed to it, but on the basis of the new legislation rather than the old legislation.
10. The Chairman urged the 20 delegations who had not yet submitted their responses to all
outstanding questions to do so without delay.
11. He said that the note also listed five Members whose reviews had already been deleted from
the Council's agenda on the understanding that any delegation should feel free to revert to any matter
stemming from the review at any time.  In this connection, certain questions had been raised with
regard to the implementing legislation of these countries.
12. The representative of Argentina said that her delegation would provide responses to the
outstanding questions arising from the review of Argentina's legislation by the next Council meeting.
13. The Chairman suggested that the Council request the Secretariat to update its note on pending
reviews before the next meeting.
14. The Council took note of the statements made and agreed  to proceed as suggested by the
Chairman and to revert to the matter at its next meeting.
(ii) Reviews of legislation of China and Chinese Taipei
China
15. The Chairman recalled that, at its meeting in June 2002, the Council had agreed that its
normal review of China's TRIPS implementation and the review under the transitional review
mechanism of China's Protocol of Accession would be combined at the present meeting and that thenormal review would be conducted following the Council 's standard procedures.  He said that China's
notification of its laws and regulations had been circulated in documents IP/N/1/CHN/1 and
Addendum 1, and the texts of the notified laws and regulations in the relevant law series documents.IP/C/M/37/Add.1
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China's responses to the Checklist of Issues on Enforcement had been circulated in document
IP/N/6/CHN/1.  China had received questions from Australia, Canada, the European Communities
and their member States, Japan, the United States  and Switzerland (documents IP/C/W/364, 366, 361,
362, 365 and 372, respectively).  The submission from the United States contained both general
comments and questions, and also referred to th e transitional review mechanism.  In addition, the
European Communities and their member States had submitted a document concerning the
transitional review mechanism which had been ci rculated in document IP/C/W/371.  China's
responses to these questions had been circulated in document IP/C/W/374 and Addendum 1.  More
recently, China had received questions from Korea, which had been circulated in document
IP/C/W/380.  Furthermore, China had submitted information in the context of the transitional review
mechanism as required under Section VI of the A nnex 1A to its Protocol of Accession (IP/C/W/382).
In addition, the Council had just received the fo llowing material:  additional questions posed by
Japan, responses to some of the questions posed by Korea, and a communication from China entitled
"Intellectual Property Right Protection in China" (subsequently circulated in document
IP/C/W/362/Add.1, 374/Add.2 and 384, respectively).
16. The representative of China said that, as a new Member of the WTO, China welcomed the
opportunity of reviewing its legislation and protection of intellectual property rights by the TRIPS
Council.  China was fully committed to the strengthen ing and improvement of the multilateral trading
system.  Given that China took its obligations unde r the WTO very seriously, it had brought a strong
team from the capital, which included experts and senior representatives from relevant government
agencies, who played a pivotal role in preparing all the documents and providing the answers to the
questions posed by various delegations.  He trusted that their presence would be conducive toimproving mutual understanding.  He said that, since the process was a combination of the  legislative
review as well as the transitional review under paragraph 18 of China's Protocol of Accession, he
wished to focus on three issues: first, the performance of China's obligations of notification;  second,
the progress of China's efforts to make the releva nt rules and regulations consistent with the TRIPS
Agreement;  and third, China's efforts for the enforcement of the laws and regulations on IPRprotection.
17. On the issue of notification, he said that, pursuant to Article 63.2 of the TRIPS Agreement,
China had notified all of the eight "main dedicated laws" related to IPR protection on 21 May 2002,
including the Copyright Law, one Patent La w, one Trademark Law and one Implementing
Regulations of the Patent Law of the People's Republic of China.  The newly amended Implementing
Regulations of the Copyright Law and Implementing Regulations of the Trademark Law were notified
on 23 August 2002.  On 12 July 2002, the Criminal Law, one Anti-Unfair Competition Law and oneCivil Procedure Law were also notified to the TRIPS Council in summary as "other laws and
regulations".  Pursuant to the decision of the TRIPS Council of 21 November 1995, China had
notified its responses to the Checklist of Issues on Enforcement relating to the TRIPS Agreement on
12 July 2002.  Pursuant to Article 69 of the TRIPS Agreement, information on contact point in China
had been notified on 1 August 2002.  Apart from the notification obligations set out by the TRIPSAgreement and the Council, China had provided responses to the questions it had received prior to the
review from six Members, including Australia, Canada, the European Communities and their member
States, Japan, Switzerland and the United States.  Among them, the responses to Australia, the
European Communities and their member States, Japan and the United States had been submitted on
23 August 2002, while the answers to  Canada and Switzerland had been submitted on 2 September2002.  China had received questions from the Republic of Korea just days before the meeting, and had
been able to provide responses to some of them just  prior to the review.  China had also provided the
Council with the information requested under Annex 1 of its Protocol of Accession.
18. With the conclusion of this preparation, China had provided complete information to the
Council for this review as required by the TRIPS Agreement, related decisions by the Council and its
Protocol of Accession.  China's IP R laws and regulations were characterized by their broad coverage
and great quantity.  The notification to the WTO and the provision of required information for theIP/C/M/37/Add.1
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review had entailed huge tasks, not the least of which was translation, and had required enormous
input of manpower and financial resources.  The fulfilment of the tasks by the Chinese Government in
spite of tremendous difficulties was a further demonstration on the sincerity and resolve of China to
honour its obligations on transparency and implement its commitments.
19. On the issue of the progress of legislation, he  said that China's IPR protection system had
begun taking shape as early as the 1970s, and had become a principal component of China's policy of
economic reform and opening-up.  The Chinese Government believed that the intellectual property
protection system played an important role in promoting science and technology innovation, cultural
prosperity and economic development.  Regarding foreign investment attraction, effective IPR
protection was an important contributing factor for the inflow of foreign investment.  Long before
China's accession to the WTO, a cross-the-board amendment of IPR laws and regulations had been
initiated with a view to bringing IPR protection in line with the requirements laid out by the TRIPSAgreement.  This process had been completed so far.  This massive overhaul of IPR legislation
covered almost all major IPR related laws and regulations, including one Copyright Law, one Patent
Law, one Trademark Law, one Implementing Regulations of Patent Law, the Regulations on
Protection of Computer Software, the Implem enting Regulations of Copyright Law and the
Implementing Regulations of Trademark Law of the People's Republic of China.  Apart from that, aseries of new regulations including the Regulations on Protection of Layout-Designs of Integrated
Circuits and Regulations on Protection of New Varieties of Plants had been promulgated.
20. The revised Copyright Law extended the scope of protection, clearly defined the right of
performers and producers, added the provisional measures of property and evidence preservation,
stipulated the amount of statutory damages and enhanced the administrative sanctions oninfringements that harmed public interests.  The Law was now in full compliance with the
requirements of the TRIPS Agreement.  The revised Trademark Law specifically provided for the
protection of geographical indications and well-known trademarks, expanded the scope of eligible
subject-matter of a trademark, stipulated the right of priority, added the judicial review to the
administrative decisions relating to trademark re gistration and strengthened the cracking down on
trademark infringement.  The revised Patent Law se t the conditions for granting compulsory licences,
and added the provision of judicial review for the administrative decisions regarding patent of utility
model and design. Regulations on Protection of Layout-D esigns of Integrated Circuit, issued in April
2001, defined the protection of the layout-designs of the integrated circuit.  In the revised Patent Law,
Trademark Law and Copyright Law, provisional measures to stop infringing acts before the trial had
been stipulated to further strengthen the protection of right owners.  Because of those major
amendments made to the related laws and regulations in this regard, the legislation on IPR protectionin China had been greatly improved and had achieved full compliance with the TRIPS Agreement.
21. It was the view of the Chinese Government th at the extensive involvement in international
exchange and cooperation on IPR protection was a principal approach to draw on the advanced
experience from other countries and enhance the capacity and level of China's IPR protection.  Since
the 1980s, China had joined in succession a number of major international conventions, treaties andagreements on IPR protection, namely the Paris Convention for the Protection of Industrial Property,
the Berne Convention for the Protection of Literary and Artistic Works, the Universal Copyright
Convention, the Madrid Agreement Concerning the International Registration of Marks, the Madrid
Protocol Concerning the International Registration of Marks, the Nice Agreement Concerning the
International Classification of Goods and Services for the Purpose of the Registration of Marks, theLugano Agreement on Establishing International Classification of Industrial Designs, the Patent
Cooperation Treaty, the Strasbourg Agreement on the International Patent Classification, the Geneva
Convention for Protection of Producers of Phonogra ms Against Unauthorized Duplication of Their
Phonograms, the Budapest Treaty on the International Recognition of the Deposit of Microorganisms
for the Purpose of Patent Procedures and the Convention for the Protection of New Plant Varieties.While actively participating in the related intern ational conventions, the Government of China had
entered into bilateral cooperation with a number of countries on intellectual property protection, suchIP/C/M/37/Add.1
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as the EU-China Intellectual Property Rights Coop eration Programme. Projects of that kind had
helped China to train its professionals in the field of intellectual property protection and enhance the
legal consciousness of the government officials for trade administration.  Those bilateral activities had
played a positive role in bringing China's IPR protection system up to international standards and
promoting the development of trade.
22. On the issue of enforcement of IPR protection, the representative of China said that  the IPR
protection provided by the Chinese Government did not stop at the achievements in the area of
legislation.  Concurrent with the continuous impr ovement on domestic legislation, consistent priorities
had also been given to issues related to IPR prot ection like the sharpening of the awareness of IPR
protection among the general public and the strengthening of the enforcement of IPR laws and
regulations so as to ensure an effective IPR legal system on the national scale.  The enforcement of
IPR protection in China took the pattern of Para llel Channels and Coordinated Operation.  Where
infringement occurs, the right holders of intellectual property might either bring a lawsuit to the court
or file a complaint to the governing administrative agencies.  The administrative agencies might take
various measures as remedies for IPR protection, including orders to stop the infringement and
imposition of fines.  Cooperation among governmental agencies responsible for IPR enforcement had
been continuously strengthened.  In May of the year 2001, the State Administration of Industry and
Commerce, the Ministry of Public Security and the State Intellectual Property Office had convened
the State Council IPR work conference and reached consensus on the establishment of an inter-agency
liaison mechanism, including with information- sharing system and an enforcement-coordination
system. Administrative measures were welcomed by right holders for their quick response to
infringing activities and low cost.
23. The Chinese Government at all levels was fully aware of the role played by IPR protection in
promoting economic development.  Local authorities had promulgated a large number of regulations
strengthening IPR protection in line with those at the national level.  Effective measures including the
cross-region joint actions were also taken to eliminate regional protectionism for infringers and crack
down on illegal practice like counterfeiting. Coope rative networks on trademark enforcement had
been established in provinces of the East China and North-East China.  Members might refer to the
documents provided by the Chinese delegation for further details and related statistics on IPR
enforcement in China in 2001.  In respect of the enforcement of Trademark Law, in the year 2001
there had been 41,163 trademark law violation cases in total.  Infringers had been ordered to pay the
right owners the damages of RMB 3,343,400 in total and there had been 86 cases transferred to
criminal procedures.  In respect of the enforcemen t of the Copyright Law, in the year 2001, copyright
administrative authorities had accepted 4,416 cases in total, among which 4,306 cases had beenconcluded with rulings.  Among those concluded, 3,607 cases had ended with the imposition of a fine
upon the infringers;  633 cases had ended with mediation;  and 66 cases had been transferred to
criminal procedings.  The Committee on Protection of Quality and Brands for Foreign Invested
Enterprises in China had acknowledged the great importance attached and effective measures taken by
the Chinese Government at all levels to crack down on counterfeited products.
24. The representative of China said that effective IPR protection was the incubator for inventions
and creations, and also the driving force behind economic development and social innovation.
Upgrading the level of the protection of IPRs was an irreversible trend and would, in the long run,
serve the common interests of all countries.  Finally, he thanked the Chairman for his efforts to have
that review progressing smoothly, the Secretariat for its painstaking preparation, and Members fortheir active and meticulous attitude.  With such an attitude, he believed that his delegation would hear
comments that would be helpful for the cause of IPR protection in China.
25. The representative of Djibouti said that the area of TRIPS was very difficult and had
significant implications, sometimes negative, for countries who simply did not have enough
experience or who just had joined the WTO.  He believed that when a country acceded to the WTO, itshould be allowed time to manage this area.  The WTO could not ask that all the TRIPS conditions beIP/C/M/37/Add.1
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met.  A certain time for reflection and for adaptation was necessary not only for China but also for
other developing countries who did not have much experience in this field.
26. The representative of the European Communities appreciated the reference that the delegation
of China had made to the programme of technical cooperation which had been in existence for several
years between the European Communities and China.  He thought that all Members couldcongratulate China for the progress it had made in this area.  Last year, the European Communities
had welcomed China's accession to the WTO, which came after 15 years of very difficult
negotiations.  China's accession was a historic leap forward for the WTO and making the WTO a truly
global organization.  Membership in the WTO would profit both China and its trading partners,
reinforcing China's place in the global economy and ensuring a greater degree of certainty for traders
in China.  In that vein, the European Communities would continue to work with China in order to
ensure that it took its full place in the WTO.
27. For the benefits of the WTO membership to be fully realised, it was essential that China
implemented its terms of accession in a timely and comprehensive manner.  The monitoring of
China's WTO compliance would be a major EC priority in the years to come.  The Chinese delegation
had already demonstrated its commitment to this process.  The European Communities counted on
China to continue to do so and give an opportunity to review the progress on a regular basis.  He saidthat China's improvement of its intellectual property legislation over recent years could be qualified as
remarkable.  With the exception of a number of outstanding concerns, generally speaking the
framework of legislation protecting intellectual property rights in China was largely in line with
international standards laid down in the TRIPS Agreement.  Along with a number of other WTO
Members, the European Communities had posed a number of questions with regard to the review ofChina's IP legislation.  It had received the responses only last week.  Therefore, his delegation was
still analysing in detail the responses provided by China,  and it might have to revert to this issue in the
future and pose additional questions and ask for further explanations.
28. The European Communities and its member States had elaborated upon the current state of  IP
legislation in China in their communication on the transitional review mechanism of China (documentIP/C/W/371).  In paragraph 3 of that communication they had asked China to provide additional
information, in particular, on the protection of undisclosed information pursuant to Article 39 of the
TRIPS Agreement and on the protection of geographical indications.  His delegation had recently had
a chance to discuss the protection of geographical indications with the Chinese delegation, but
continued to have questions concerning the functioning of that type of protection.  In addition, he
wished to discuss the current status of the Implementing Regulations of Copyright and Trademarks.
29. In the same document, the European Communities had also elaborated on the success story of
China's implementing process of IP legislation.  However, the European Communities were aware
that further action was necessary in particular in the area of enforcement.  The level of piracy and
counterfeiting remained extremely and unacceptably high.  He encouraged the Chinese authorities to
continue to step up their efforts to fight piracy and counterfeiting.  In his view, the inter-agency
authority was of extreme importance. In many countries, there was a need for many different agenciesto cooperate with each other in order to have coordinated action, in particular, to fight piracy and
counterfeiting.  In their communication, the European Communities had encouraged China to
establish a clear and comprehensive long term strategy in the area of enforcement of IP rights.
Despite the major efforts that had already been undertaken, a well-designed strategy playing out over
several years was indispensable.  The European  Communities were willing to explore with the
Chinese authorities how enforcement could be further enhanced.  He hoped that the Chinese
authorities would carefully look at the suggestions in paragraph 10 of the communication, and he was
looking forward to discussing with China any follow-up to the communication.
30. He said that in the area of enforcement, it was important that the Chinese authorities
examined whether to raise the upper limit of administ rative penalties.  Also, the provision regardingIP/C/M/37/Add.1
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compensation for losses should be reconsidered so that judiciary recourse would become more
attractive.  In the case of repeat offenders, the criteria for criminal prosecution should be lessened.
Some terms in the Criminal Code, such as "relatively high sales" or "extremely serious conditions",
should be defined more precisely.  The procedure for requesting a trademark to be considered as a
well-known mark should be clarified.  He hoped that the Trademark Office, with the issuance of newTrademark Law and the Implementing Regulations, would begin processing applications for foreign
well-known trademarks.  The Chinese customs shoul d be empowered to transfer serious cases they
discovered to prosecutors for criminal investigation and prosecution.  Both the high bonds and storage
fees that were requested by the Chinese custom authorities had been responsible for deterring many IP
owners from recording their ri ghts with the customs.  Such bonds should be lessened.
31. Finally, he indicated that the European Communities and its member States were committed
to continuing their programme of technical cooperation with China in this area, in particular withregard to enforcement.
32. The representative of Korea expressed his appreciation of the opening remarks of the Chinese
delegation outlining China's policy to increase IPR protection in China and to honour its commitments
under the TRIPS Agreement and other international agreements.  Korea also welcomed China's recent
notification of its TRIPS implementing laws and regulations, together with its responses to theChecklist of Issues on Enforcement, which reflected China's efforts to meet its obligations as a new
Member and to bring its domestic laws and regulations in line with the TRIPS Agreement.  Korea
looked forward to close cooperation with China in th e area of intellectual property as it expected that
bilateral transactions in that area would grow substantially in the coming years along with the overall
expansion of trade between the two countries.
33. He thanked China for the prompt responses that it had received to many of the questions it
had posed to it.  This demonstrated China's sincere endeavour to stand by its commitments to the
TRIPS Agreement and strengthened multilateral trading system.  Korea expected that responses to the
outstanding questions would be provided in due course.
34. The representative of Japan thanked the delegation of China for its presentation.  In
accordance with Section 18 of the Protocol on the Accession of People's Republic of China which
established the process for the Transitional Review Mechanism (the "TRM"), he provided the
following comments on China's implementation of the TRIPS Agreement.
35. He said that Japan appreciated China's efforts to provide legislation protecting intellectual
property rights over the recent years.  A number of laws had been introduced and that administrative
and judicial functions for the enforcement of those laws had also been improved.  He believed that
those efforts would promote international economic activities, and facilitate developmental andtechnological improvements in China.  Japan hoped China would notify the TRIPS Council of
relevant laws and regulations that had not yet been notified, and wished to further clarify the situation
in regard to laws and regulations and their enforcement through the questions that Japan had already
posed and would pose, and replies to those questions.
36. Japan was concerned about the serious situation in regard to intellectual property rights'
infringements, including counterfeiting and piracy, in China.  Damages were growing serious and
export of infringing goods to third countries was beginning to have negative effects on international
trade.  While it noted the efforts of the Chinese Government to solve these problems, Japan hoped that
China would take further steps to improve the situation.  He said that, in Japan, an organization
consisting of over 150 companies and associations from many industries had been set up inApril 2002 to address these problems.  It had recently submitted an urgent request to the Japanese
Government concerning problems in China.  The Japanese private sector as well as the Government
were highly interested in the protection of intellectual property rights in China.IP/C/M/37/Add.1
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37. Based on the above circumstances, Japan requested the Chinese Government to address the
following points in a timely manner.  Given that, at present, his delegation did not have sufficient
information on the Chinese legal system and its enforcement, it might wish to raise further points in
the future, after gaining a clearer picture of the situation.
38. Firstly, the representative of Japan expressed his concern that the Chinese Government's
enforcement was inadequate in view of Part II of the Protocol,  including Articles 41 and 61.  Japan
requested further improvements in the enforcement of existing legal protection on the following
aspects: (a) Criminal Procedures: active implementation of criminal prosecution, including
amendments in the guidelines for criminal prosecution, strengthening of criminal penalties;
(b) Administrative Procedures: improvement in enforcement by administrative agencies, imposition of
maximum administrative penalties and raising of upper limit of administrative penalties;  (c) Judiciary
Procedures:  review of provision of compensation for losses in order to facilitate judiciary recourse;
(d) Improvements in export regulations and laws, and the efficacy of controls against the export of
infringing goods; (e) Strengthened cooperation among different enforcement authorities;
(f) Elimination of local protectionism:  the Chinese Government's strong leadership was required to
prevent regional governments and administrative agencies from favouring local industries;
(g) Destruction of goods that infringe rights:  Japan requested that authorities completely destroyseized infringing goods, in order to prevent repetition of counterfeit crimes, and that they do not
charge a fee for destruction from the right holders.
39. As regards the patent examination processes, he  said that he appreciated China's efforts to
eliminate delays in patent examination processes, but he was still concerned about the possibility that
these delays might undermine the objectives of Article 62.2 of the TRIPS Agreement.
40. As regards the protection of well-known trademarks, he said that he was concerned that
foreign well-known trademarks were not given equal treatment with Chinese trademarks.  He
requested clarification of how the current list of well-known trademarks under the old law would be
treated in the new Implementing Regulations of the Trademark Law, and whether there would be any
new list of well-known trademarks under the new regulations.  He asked China to confirm that theexistence of the list of well-known trademarks under the old law would not cause foreign well-known
trademarks to be treated less favourably than domestic well-known trademarks under the new legal
regime in term of their protection, including criminal enforcement.
41. As regards licensing regulations on patents and know-how, he said that his delegation was
concerned that some licensing provisions, including Article 24 of the Technology Import/Export
Control Regulations, imposed on foreign licenser heavier burden than on domestic licensers.  He
requested this concern to be addressed appropriately.
42. As regards the system requiring foreign patent applicants to use representative offices
designated as those for foreign applicants, he said that, under Article 19 of Patent Law and Article 18
of Trademark Law, foreign applicants were required to carry out procedures to obtain
patent/trademark rights in China through representative offices designated by the Chinese
Government as those for foreign applicants.  That could put foreign applicants at a disadvantage.  Herequested the issue to be addressed appropriately.
43. In concluding, he expressed his appreciation of the efforts by China over recent years to
improve its intellectual property rights regime.  Although the protection of IP had already been
strengthened  in a number of ways, there remained a lot of things that the Chinese Government could
do.  His delegation strongly hoped that China would further strengthen protection of IPR in China.Finally, he said that he wished to have his comments included in the TRIPS Council's report to the
General Council on the TRM, bearing in mind a possible recommendation by the General Council
according to paragraph 18.2 of the Protocol on the Accession of China.IP/C/M/37/Add.1
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44. The representative of the United States recognized and appreciated the hard work done by
China's legislators, administrative officials, judicial officials, and others in reviewing, enacting and
drafting new intellectual property laws and regulations as part of implementing China's WTO
commitments and in strengthening China's lega l regime for the protection and enforcement of
intellectual property.  He said that his delegation recognized that, in addition to revision of key laws,such as patent, trademark and copyright law, conducted over the past two years, China had had to
enact, revise or annul many central government laws, regulations and other measures as well as
sub-central measures dealing with intellectual property.
45. He expressed his appreciation of the presentation by the Chinese delegation and the
considerable effort that had been made in responding to the US questions in such a complete manner.
He said that, in addition to the obligations contained in the TRIPS Agreement, the comments and
questions his delegation had submitted had been based on the Report of the Working Party on theAccession of China (WT/MIN(01)/3) (the "WPR") and intended to form a part of the transitional
review mechanism.
46. He said that the United States considered transparency in making laws, regulations, rules and
other measures, including the opportunity to prov ide comments on such provisions as set forth in
Section 2, paragraph 2(C) of Chin a's Protocol of Accession and in paragraphs 324 through 336 of the
WPR to be a key aspect of China's WTO commitments.  In particular, he said that China had
committed to publish its laws, regulations and other measures in an official journal and provide a
reasonable period for comment to the appropriate authorities before such measures were implemented.
Moreover, China had agreed that to make these laws, regulations and other measures available to
WTO Members upon request before they were implemented or enforced.  The Law on Legislationauthorised officials to provide the opportunity to receive comments and required publication of laws,
regulations and other measures.  He said that the United States strongly urged China to provide this
opportunity in all cases.  He also said that the United States had certainly appreciated the opportunity
to work with China in developing its law and regulations.
47. He said that the United States did share the concerns expressed by other Members regarding
the high level of piracy and counterfeiting in China.  He urged China to take further steps to
significantly reduce overall rates of infringement.  He said that the United States looked forward to
continued bilateral cooperation with China that it had enjoyed for some time in order to complete the
revisions of its trademark and copyright implementing regulations as well as assisting China in its
efforts to harmonize its laws with new treaties to which it might wish to accede, such as the WIPO
Copyright Treaty and one WIPO Performances and Phonograms Treaty.
48. Finally, he said that his delegation had had only a brief period of time to review the answers
that China had provided to its questions.  But as a result of that brief review, it wished to pose a few
follow-up questions in several key areas, and it might have additional follow-up questions later on.
49. The representative of Switzerland thanked the delegation of China for the presentation and the
summary of new Chinese IP legislation.  He congratulated China for its commitment and considerable
efforts to bring its legislative framework in comp liance with its TRIPS obligations.  Effective legal
protection of IPRs and in particular the consistent enforcement of that legislation played a crucial role
for the economic development and integration into the international trade community and the WTO.
He said that his delegation had received responses from China to the questions that it had submitted.
It would submit a few follow-up questions to the Chinese delegation in the course of the week.
50. The representative of Australia thanked China for the information it had provided during the
Council's meeting and for the responses to the questions posed by his delegation.  He recognized
China's achievements in developing IP law and increasing awareness among Chinese officials and
business of the importance of strong IPR protecti on and enforcement.  He also noted the concerns
expressed by some delegations about China's implementation of its TRIPS obligations.  He welcomedIP/C/M/37/Add.1
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China's willingness to continue its efforts to improve TRIPS implementation and an opportunity to
engage with China in these efforts in the WTO, in  a regional forum like APEC, and at the bilateral
level where they had established an effective dialogue on a number of IP issues.
51. The representative of Pakistan thanked the delegation of China for its very concise and
comprehensive presentation, and congratulated China for implementing its obligations under its
Protocol of Accession.  It was a commendable performance given the numerous tasks of amending
major laws and regulations governing the protection of IPRs.  He said that WTO Members should also
acknowledge the swiftness with which China had re sponded to its obligations, as well as to the
questions raised by other Members.  This was an ample evidence of the level of  seriousness that the
Chinese Government attached to its accession to the WTO.  The obligations should not be more
onerous than what had been taken on by the rest of the membership.  Finally, he assured China about
the full cooperation of his delegation as and when required.
52. The representative of Canada congratulated China on the tremendous progress it had made in
a very short time, and thanked it for its comprehensive overview and responses to questions posed by
her delegation.  It was clear that China was working hard to bring broad changes that complied with
the TRIPS Agreement.  She particularly appreciated the Chinese delegation's comments on the
enforcement measures China had already implemented.  She encouraged China to continue to work on
this very important aspect of IPRs.  Her delegation was studying the responses it had received and it
might have some follow-up questions.
53. The representative of China said that his delegation appreciated very much the comments and
questions given by various delegations.  He thanked them all for their active participation and their
input for this review.  Furthermore, he wished to comment on certain questions that seemed to be ofcommon concern to other Members.
54. As regards copyright, he said that after the revised Implementing Regulation would enter into
force, each local copyright administration department could investigate and deal with all infringing
acts (including those involving foreign right owners ) that took place in its own administrative area,
without the necessity of requiring approval by the copyright administration department under the StateCouncil.  Accordingly, there was no different procedure applicable to domestic cases involving
foreign companies as regards administrative penalties.  Article 21 of the revised Implementing
Regulations of Copyright Law provided that the use in accordance with the Copyright Law of a
published work without permission from copyright owners shall not conflict with a normal
exploitation of the work and shall not unreasonably prejudice the legitimate interests of the copyright
owner.  This provision was in conformity with the renowned "three-step standard of examination"
enshrined in the Berne Convention and the TRIPS Agreement.  In the enforcement of the CopyrightLaw, the application of either the "reasonable exploitation" or the "legitimate statutory licensing "
should not be in violation with the above-mentioned provision.
55. On patents,  he said that the consultation process provided for in Article 57 of the Patent Law
of the People's Republic of China was optional.  It was neither mandatory nor a prerequisite for
instituting legal proceedings in the court.  It was his understanding that consultation before takinglegal actions or going for dispute settlement outside of court was a regular practice to settle disputes in
most countries.  According to Article 10 of the Patent Law of the People's Republic of China, where
Chinese entities or individuals intended to assign their right to apply for patent or patent right to
foreigners, they must obtain the approval of the competent department concerned of the State Council.
This was not applicable to foreigners assigning th eir right to apply for a patent or patent right to
Chinese entity or individuals or to foreigners.  Hence there was no conflict between Article 10 of
China's patent Law and Article 3 of the TRIPS Agreement.
56. On trademarks, he said that the requirement for foreigners to use a designated trademark
agency was an international practice rather than so mething unique to China.  Such practice was in fullIP/C/M/37/Add.1
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compliance with the requirements of Article 2.3 of the Paris Convention and Article 3 of the TRIPS
Agreement.  The problem of only some trademark agents can be used by foreign enterprise no longer
existed.  From 1 January 2001, all trademark agencies legally established were entitled to deal with
foreign business on trademarks.  Moreover, foreigners  who needed to use an agent referred to those
who were not domiciled or did not have industrial or commercial establishment in China.  Accordingto the Trademark Law and its Implementing Regulations, the protection of well-known marks was
applied equally to the domestic and foreign right holders.  China had provided a very high level of
protection for foreign well-known marks such as IBM, Adidas, Nike, just to mention a few of them.
The information on the list of well-known trademarks and the website that provided the information
was not accurate.  Clarifying two points in this regard, he said that, firstly, the list was simply a record
of cases that the Trademark Office had dealt with.  It did not mean that those not on the list were not
protected as well-known marks.  Secondly, the protection of well-known marks was specifically
provided in the newly revised Trademark Law and its Implementing Regulations.  The specific
procedural rules on the determination of the well-known marks were under revision.  Where a dispute
arose, the owner of a well-known trademark might be enlisted by approaching either administrative or
judiciary authorities for the determination on whether his mark was well-known or not.  Where a mark
was so determined, the application for registration of the other party must be rejected.  The disputedregistration must be cancelled and the use of the disputed mark must be prohibited.
57. On layout-designs of integrated circuits, he said that the provisions of the Regulations on the
Protection of Layout-Designs of Integrated Circuits were fully in conformity with the provisions in
Section 6 of Part two of the TRIPS Agreement.  If the discrete complied with the provisions of
Articles 2 and Article 4 of the Regulations, it could be protected through applying for a registration ofa layout-design under the Regulations.  Where the discrete did not meet the requirements of the
Regulations and thus could not be protected by the Regulations, it was still possible to have it
protected as trade secrets under the Anti-Unfair Competition Law.  In addition, if the technology
involved in the discrete met the requirements for ap plying for a patent as provided for in the Patent
Law, patent protection could be sought through applying for a patent.
58. On geographical indications, he said that geographical indications were protected mainly
under the system of trademark law and its implementing regulations.  Articles 3, 16, 52 and 53 of the
Trademark Law and the relevant provisions of the revised Implementing Regulations provided
adequate protection for geographical indications as required under Article 22.2 of the TRIPS
Agreement.  In addition, Anti-Unfair Competition Law also provided protection for geographical
indications.
59. On enforcement, he said that, in China, admini strative authorities had the authority to impose
sufficient penalties to prevent or deter furt her infringement. For instance, in accordance with
Article 47 of the Copyright Law, copyright administration might impose administrative penalties on
an infringer who also prejudiced the public interests.   Such penalties included:  ordering the infringing
act to be ceased;  confiscating the unlawful income;  confiscating or destroying the infringing copies;
imposing a fine and confiscating the material, tools and instrument mainly used to produce infringing
copies.  For serious offenders, the provisions provided sufficient legal basis for preventing or
deterring further infringement through judicial procedures.  For the infringement of trademarks and
copyright, the offender shall be sentenced to a set term of imprisonment of not more than three years
or criminal detention, and concurrently or independently be sentenced to a fine.  If the sum from the
sale is high, the offender shall be sentenced to a set term of imprisonment of no less than three yearsand not more than seven years and concurrently be sentenced to a fine.  In accordance with Article 48
of the Copyright Law, an infringer had to pay comp ensation for damages pursuant to the actual loss of
the right owner or to the unlawful income of the infringer.  In case the actual loss of the right owner or
the unlawful income of the infringer could not be  determined, the court may decide on compensation
not more than 500,000 yuan in RMB.  Generally speaking, the maximum of 500,000 yuan in RMBwas per lawsuit.  For infringement of a patent, the offender shall be sentenced to fixed-term
imprisonment of not more that three years or criminal detention and concurrently or independently beIP/C/M/37/Add.1
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sentenced to a fine.  With regard to China's protection of intellectual property, he said that it was fully
in compliance with the requirements set forth in  Article 61 of the TRIPS Agreement in respect of
criminal law and criminal punishment.  The degree of China's criminal punishment was one of the
severest in the world.
60. He  explained that these were initial comments and answers to some of the questions raised at
the meeting.  For other questions his delegation had either provided written answers before the
meeting or would provide them as soon as possible after the meeting.
61. Finally, he said that he strongly believed this review had been very helpful for China to
further strengthen its enforcement of IPR protection.  China had every reason to provide a high level
of IPR protection since China was having a growing number of local inventions and famous
trademarks to be protected.  Besides, whether China could attract more foreign investment to China
and whether foreign enterprises would like to bring in new technologies to China depended very muchon the level of its protection of IPRs.  Although this was the first year of China's membership, China
had already seen a sharp increase of inflow of foreign investments which demonstrated the great
determination of the Chinese Government to protect IPRs and the progress it had achieved so far in
this field.
62. The Chairman suggested that the Council offer an opportunity to the Chinese delegation to
respond to any initial or follow-up questions to which it had not yet responded later in the course of
the meeting.  If there were any written questions and responses which could not be given by the end
of this meeting, then in accordance with the normal  procedure of this Council,  there would be the
opportunity for those delegations who wished to su bmit their questions to do so after the meeting.
63. The Council so agreed.1
Chinese Taipei
64. The Chairman recalled that, at its meeting in March 2002, the Council had decided to review
the legislation of Chinese Taipei at the present meeting.  The Secretariat had received a notification of
the TRIPS implementing laws and regulations from Chinese Taipei, as well as its responses to the
Checklist of Issues on Enforcement.  He said th at the notification of Chinese Taipei had been
circulated in document IP/N/1/TPKM/1 and the texts of its main laws and regulations in the related
laws series documents.  The responses to the Checklist on Issues of Enforcement were available in
document IP/N/6/TPKM/1.  Chinese Taipei had received questions from Australia, Canada, the
European Communities and their member States, Japan, Korea, the United States and Switzerland
(documents IP/C/W/364, 366, 367, 362, 380, 379 and 372, respectively ).  The responses to Japan had
been circulated in advance of the meeting in  document IP/C/W/373.  The Secretariat had recently
received copies of the responses to Australia, Canada, the European Communities and their memberStates, Korea, the United States and Switzerland (subsequently circulated in document
IP/C/W/373/Add.1).  In addition, Japan had just submitted additional and follow-up questions
(subsequently circulated in document IP/C/W/362/Add.1).
65. The representative of Chinese Taipei said that since Chinese Taipei became a WTO Member
on 1 January 2002, his delegation had submitted a total of 26 notifications on Chinese Taipei's IP
related laws and regulations.  In the past couple of years, members of the working party on Chinese
Taipei's accession to the WTO had made a great effort to review all relevant laws and regulations in
order to ensure their WTO conformity.  Chinese Taipei's IP legislation, in particular, was one of the
areas in respect of which members of the working party had expressed their satisfaction.  However,
his Government would not be contented with the past achievements.  It understood that IP related
                                                     
1 For further discussion, see paragraphs 84-96 below.IP/C/M/37/Add.1
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matters evolved with ever growing society and legi slation should be able to cope with the rapid
progress in modern technology.
66. In order to respond to these challenges, several draft amendments to copyright law, trademark
law, patent law and plant seed law were now under either administrative or legislative review.  His
delegation would notify the Council after the completion of these amendments.  He said that theCouncil was welcome to take up these matters and arrange their review in due course.  In fact, some
Members had  already demonstrated their interest in them by raising specific questions concerning
these draft amendments.  For the sake of  transparency, his delegation would try its best to address
these questions even though the amendment proposals were not yet ready for review.  His
Government had attached great importance to this review exercise, and it had organised a big team
from the relevant agencies to answer the questions already submitted and to any follow-up questions,
to the extent possible, already at he present meeting.  He expressed his gratitude to those Memberswho had posed questions for the close interest that they had taken in Chinese Taipei IP legislation.
67. He said that his Government had always considered the constant improvement of IPR
protection a high priority on its trade agenda.  Chinese Taipei firmly believed that technological
innovation, transfer and dissemination of technolo gy could only be promoted through adequate and
proper IPR protection, and this was instrumental to its sustainable trade development conducive to theenhancement of its social and economic welfare.  Chinese Taipei recognized the importance of
bringing its IPR regime into compliance with international norms.  In connection with its accession to
the WTO, Chinese Taipei Government had revised and implemented IPR laws and regulations to
bring the level of its IPR protection regime not only in conformity with the TRIPS Agreement but also
with other relevant international conventions.  He said that his Government continued to duly modify
its  IPR-related laws and regulations to conform to international norms.  Noting that Members had
raised questions relating to Chinese Taipei's copyright, trademark, geographical indications, industrial
designs, patents, plant varieties, IC layouts, undisclosed information, and enforcement, he introduced
a few main points of the legal system in each field of intellectual property rights in order to enable
Members to comprehend the issues within a broader perspective and with reference to the ChineseTaipei IPR legislative system.
68. The current Copyright Law, which had entered into force on 14 November 2001, was
formulated in accordance with the TRIPS Agreement in combination with the Berne Convention.  All
the nationals of WTO Members were entitled to receive the same level of copyright protection as
theirs.  The Copyright Law provided for, retroactively, from the date of Chinese Taipei's accession to
the WTO, the term of copyright protection for author's life plus fifty years or fifty years from the date
of first publication.
69. The existing Trademark Law had been amended in 1997 and put into force on 1 November
1998.  Combinations of colours were eligible for protection. In addition, the right holder might now
request for the destruction or other necessary disposal of the infringing goods or of the materials or
implements that had been utilised to conduct such infringing act.  In order to further extend protection
on well-known trademarks or service marks, Chinese Taipei had referred to the JointRecommendation concerning provisions on the prot ection of well-known marks that had been adopted
by the assembly of the Paris Union for the protection of industrial property and by the General
Assembly of WIPO in September 1999.  The Main  Points for Determining Well-Known Marks and
Service Marks 2000 had been established in accordance with the said Joint Recommendation.
Geographical indications were protected as required by the TRIPS Agreement.  Relevant laws andregulations to provide such protection included the Fair Trade Law and Trademark Law.  In addition,
the Tobacco and Alcohol Administration Law had been enacted on 19 April 2000.  Under the said
law, the Regulations Governing the Labeling of the Alcohol Products had been enacted on 30
December 2000.  Those provisions provided alcohol products with the additional protection.IP/C/M/37/Add.1
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70. Invention patents, new utility model patents and new design patents were protected under
Chinese Taipei's Patent Law.  The latest amendment to the Patent Law, in connection with its
accession to the WTO, had entered into force on 1 January 2002.  Provisions such as national
treatment of priority claim, patentable subject-matter, term of protection, rights conferred, exceptions
to rights conferred and other use without authorization of the right holder were in conformity with theTRIPS Agreement.  The Integrated Circuit Layout Protection Act had been put into force on
11 February 1996.  It complied with the TRIPS Agreement and the Treaty on Intellectual Property in
Respect of Integrated Circuits (adopted in Washington on 26 May 1989).  Part of the Integrated
Circuit Layout Protection Act had been amended and promulgated on 12 June 2002.  The protection
of trade secrets had originally been found in regulations deriving from the Civil Law, Criminal Law
and Fair Trade Law.  Pursuant to Article 39.2 of the TRIPS Agreement, the Government had enacted
the Trade Secret Law in 1996 to clarify provisions governing the related definition, belonging,infringement and civil compensations.  The post-marketing surveillance system on new drugs had
been implemented since 1993.  All test data submitted for the approval of the competent authority
enjoyed the above-mentioned pipeline protection.  He believed  that this system was in conformity
with Article 3 9 of the TRIPS Agreement.
71. IPR enforcement was of great importance to IP protection.  Chinese Taipei had undertaken
stringent enforcement measures to deal with trademark counterfeiting and copyright piracy.  The
enforcement mechanism of intellectual property righ ts involved government agencies at different
levels, including courts, prosecution offices, police, Customs, Intellectual Property Office and the
Anti-Counterfeiting Committee of the Ministry of Ec onomic Affairs.  The Implementation Regulation
for Suspension of Release of Goods Infringing on C opyrights or Plate Rights by Customs Authorities
had been implemented to prohibit the importation and exportation of goods that violated copyright
laws.  To combat counterfeiting and piracy activities, in particular, on pirated optical disks, the
Optical Disk Law (ODL) had been enacted and it had entered into force on 16 November 2001.  The
Joint Optical Disk Enforcement Task Force (JODE) – a team dedicated to combat counterfeiting and
piracy – had been established to integrate the personnel and resources of relevant authorities toeffectively crack down, with the assistance of the police force, counterfeiting and piracy.  Business
entities were not allowed to manufacture optical disks unless they obtained the approval for filing of
source identification code of optical disks in advance.  To raise public awareness on the importance of
IPR protection, the Government had declared the ye ar 2002 as the "Action Year of IPR Protection".
In conjunction of this announcement, numerous crackdowns had been carried out islandwide on
counterfeiting and piracy since 30 January 2002.  It was expected that more and better performance
results would be achieved.
72. Chinese Taipei attached great importance to adequate and effective IPR protection.  It also
looked at IPR protection as an indispensable part of daily life.  As a Member of the WTO, the
Government would actively participate in the ongoing multilateral trade negotiations on the TRIPS
Agreement.  Chinese Taipei was  determined to  bring its IP-related laws and regulations into
conformity with the TRIPS Agreement and other relevant international conventions.
73. In conclusion, the representative of Chinese Taipei said that the era of information technology
had brought huge impact on the scope and architecture of the IPR protection regime.  To deal with
such an unprecedented challenge, WTO Members had properly and timely revised their IPR-related
disciplines.  Chinese Taipei was no exception.  To keep its IPR regime duly updated in parallel with
that taking place both at the WTO and in other international conventions, Chinese Taipei believed thattechnical assistance was necessary.  This would enable it to have access to relevant IPR-related
information and to participate in IPR-related activities, and enable it to fulfill its notification
obligations reflecting transparency as required by the TRIPS Agreement.
74. The representative of Japan thanked Chinese Taipei for its comprehensive presentation and
responses to Japan's questions.  He said that the forum established by the Industrial Association had
submitted to the Government of Japan a set of urgent requests on 12 September 2002 on theIP/C/M/37/Add.1
Page 16
implementation of IP by Chinese Taipei.  He believed that these requests reflected the strong interest
that the Japanese Government and the private sector had on the protection of IPRs in Chinese Taipei.
75. The representative of Korea welcomed Chinese Taipei's comprehensive presentation and
notification of its TRIPS-implementing laws an d regulations. He expressed his appreciation of
Chinese Taipei's efforts to bring its IP regime in  full conformity  with the TRIPS Agreement, and
looked forward to a close cooperation with Chinese Taipei in the IP area, as it was one of Korea's
important trading partners in the region.  He appreciated Chinese Taipei's prompt answers to the
questions posed by his delegation.
76. The representative of the United States thanked the delegation of Chinese Taipei for its
presentation, its answers to US questions as well as its extensive efforts to bring Chinese Taipei IP
regime in line with its WTO obligations.  The US had enjoyed a long relationship with Chinese Taipei
on the issue of IP and recognized the progress that had been made, but he drew attention to the factthat IP situation in Chinese Taipei remained extremely serious.  He expressed particular concerns both
with respect to the need to complete the process of  amending Chinese Taipei's copyright law to bring
it into full conformity with TRIPS obligations, but al so with respect to the situation of enforcement
against copyright piracy.  In particular, he drew  Members' attention to question 12, posed by the
United States on the issue of enforcement.  In this question, the United States had drawn the attentionto the fact that the level of optical disc media piracy in Chinese Taipei continued to be high despite
the recent enactment of optical disc law.  It had been reported that the losses to US copyright industry
had totalled over 300 million in 2001 as a result of piracy.  It had been further reported that Chinese
Taipei had at least 61 known optical media plants and 9 or more underground plants containing over
11 hundred replication lines, including 93 DVD lines, over 200 VCD lines and over 800 CDR lines.All of these lines were engaged in manufacture of finished optical media products, including CDs, CD
ROMs, VCDs, DVDs and CDRs, as well as blank media.  The total potential production capacity of
these plants, that was not including the CDR capacity, was over one billion.  That dwarfed by far the
40 billion units legitimate domestic demand.  Finally, he expressed his appreciation of the fact that
Chinese Taipei had identified this year as a special year of enforcement.  He said that his Government
was committed to working with Chinese Taipei to  change and significantly reduce the level of
copyright piracy, particularly optical disc piracy in this year of enforcement.  He hoped that his
government could look to a drastically improved situation in the not too distant future.
77. The representative of Switzerland expressed his appreciation of Chinese Taipei's
comprehensive presentation, and said that the choice of the year of 2002 as the year of IP protection
was a symbol of its commitment to IP protection.  He hoped that the measures and additional
initiatives Chinese Taipei was taking this year would be successful and sustainable,  in particular inthe field of enforcement.  He also looked forward to  cooperating with Chinese Taipei in the area of IP.
In addition, he said that his delegation had received from Chinese Taipei the responses to their
questions in the course of its review procedure.  It had analyzed these responses and had no follow-up
questions for the time being, but reserved its right to come back with further question if necessary in
the course of procedure.
78. The representative of Canada joined the other Members expressing appreciation to Chinese
Taipei for its work to implement its TRIPS obligatio ns and for its comprehensive report.  While it was
clear that Chinese Taipei was taking many important steps to implement the TRIPS Agreement and
the obligations contained therein, she agreed that there was still some work to be done.  In addition,
she thanked for the answers to Canada's questions.
79. The representative of Australia thanked Chinese Taipei for the presentation and responses to
the questions posted by Australia.  Australia and Chinese Taipei had a positive bilateral trade
relationship in the area of IPR, and thus cooperated closely in other fora, such as APEC.  Australia
welcomed the efforts made by Chinese Taipei to bring its legislation in line with the standards
provided under the TRIPS Agreement.  He had also noted some concerns expressed by some otherIP/C/M/37/Add.1
Page 17
delegations, and appreciated Chinese Taipei's willingness to engage further with other Members on
these issues.
80. The representative of the European Communitie s thanked Chinese Taipei for the information
it had provided, and said that he recognized that it had significantly enhanced the protection of IPRs
over the last several years.  However, to respond to the continued complaints about insufficientenforcement, Chinese Taipei should urgently wo rk on setting up an adequate enforcement system,
commencing with the judicial system and adequate training of IPR judges.  The EC industry had been
particularly concerned about inadequate enforcement efforts vis-a-vis persistent manufacturing and
exportation of pirated software, video games and other optical media, including in particular compact
disc piracy.  Another concern was the lack of adequate protection for the packaging and presentation
of goods ( "trade dresses").  In Chinese Taipei, the problem of look-alikes was particularly serious for
consumer goods and spirits.  There was a widespread copying of colour combinations, shapes andmaterials of the appearance of well-known European brands.  The problem of false labelling and
"look-alike" products would probably be reduced if Chinese Taipei were to introduce adequate
protection for geographical indications as it ought to do under Article 23 of the TRIPS Agreement.
Therefore, he urged Chinese Taipei to comply with Article 23 of the TRIPS Agreement whereby
additional protection to wines and spirits should be granted, not only to prevent a third party fromregistering a trademark containing a geographical indication but also to prevent a third party from
using such a sign in the course of commerce.
81. The representative of Chinese Taipei  thanke d all the delegations who had provided questions
and remarks as well as encouragement to Chinese Taiwan's IP legislation efforts as well as
enforcement.  He said that his Government wa s determined to fully comply with the TRIPS
Agreement and the WTO rules on IPR legislation and practice, and it welcomed Members to pose
follow-up questions during the Council meeting or af terwards.  He provided initial oral responses to
the additional and follow-up questions posed by Japan (subsequent written responses can be found in
document IP/C/W373/Add.1).  In concluding, he thanked all the delegations that had been working
with his delegation by providing information and questions as well as continued communication withit.  He also reiterated that his Government was determined to comply with  the TRIPS Agreement and
all WTO rules fully.
82. The Chairman suggested that the Council offer an opportunity to the Chinese Taipei
delegation to respond to any initial or follow-up question to which it had not yet responded in the
course of the meeting.
83. The Council so agreed.
Further Discussion
84. Reverting to this agenda item, the Chairman recalled that the Council had agreed to provide
the opportunity to the delegations of China and Chin ese Taipei to respond to any initial or follow-up
questions to which they had not yet had an opportunity to respond.  He said that China had already
provided its responses to some of the questions that it had received from Korea, but it had not yet
been able to respond to all of the questions.  China had received some additional questions fromJapan, and follow-up questions from the United States.
85. The representative of China said that, after the completion of the TRM  review of China two
days earlier, Japan and the United States had posed some follow-up questions to China.  China had
already provided respective written replies with copies to the Secretariat (subsequently circulated in
document IP/C/W374/Add.2).  If Japan or the United States would have further questions, Chinawished to discuss with them and other WTO Members in the framework of the standard legislation
review, on a bilateral basis, or through China's WTO enquiry points based in MOFTEC (Ministry ofIP/C/M/37/Add.1
Page 18
Foreign Trade and Economic Cooperation).  For the remaining questions raised by Korea, he said that
his delegation would provide written replies as soon as possible.
86. The Chairman recalled that Chinese Taipei had already provided oral responses to some of the
questions posed by Japan, and Chinese Taipei had received some follow-up questions from the United
States.
87. The representative of Chinese Taipei said that , after Tuesday's meeting, in addition to the
follow-up questions posed by Japan, his delegation had received the follow-up questions from the
United States.  After providing oral responses to some of them, he said that written responses would
be submitted shortly (subsequently circulated  in  document IP/C/W/373/Add.2).  In concluding, he
said that his delegation was eager to see the early completion of the legislation review and it would do
its utmost to answer all the follow-up questions in a timely fashion.
88. The representative of Japan thanked China for its prompt written responses to his delegation's
additional questions.  His delegation was still analysing the written responses to its initial questions.
In addition to these responses, it wished to look at the additional documents submitted two days
earlier by China.  Then it would like to raise fu rther questions and comments in the process of the
TRM review of this year.
89. The representative of the United States thanked both Chinese Taipei and China for their
efforts at the present meeting to respond his delegation's follow-up questions.  He appreciated the
efforts and opportunity to clarify certain issues.  He said that his delegation intended to review the
answers in some more detail and might follow up with some additional questions as part of the
transitional review mechanism.
90. The representative of China said that China was ready to discuss with other WTO Members
follow-up questions in the framework of the legisl ation review, bilaterally or through China's WTO
enquiry point.  The TRM exercise must proceed on the basis of Article 18 of China's Protocol of
Accession to the WTO.  China was not obliged to share any responsibility beyond that provision.
91. The Chairman said that in accordance with the normal procedures, the Council should agree
on a time-frame for any further follow-up questions and responses to those follow-up questions.  He
suggested that the Council provide the period until 11 October for any follow-up questions to be sent
in writing with a copy to the Secretariat and fo r the period until 8 November for responses to be
supplied in writing, again with a copy to the Secretariat.
92. With regard to China, he said that the Council also had to decide on the report that it had to
make to the General Council in accordance with th e transitional review mechanism. He suggested that
the Secretariat be requested to draft a factual report which would describe what had happened and
make reference to the documentation that had been produced, including the relevant parts of theCouncil's minutes.
93. The representative of Japan said that he understood that the report was to be submitted with a
view to the review by the Ge neral Council and a possible recommendation from it under paragraph
18.2 of China's Protocol of Accession.  It was up to the General Council to decide whether it should
make a recommendation or not, but the TRIPS Counc il needed to provide the necessary information
for the General Council's review and decision.  Therefore, the report needed to accurately reflect the
TRM review in the TRIPS Council, including Japan's specific concerns.
94. The representative of China said that paragraph 18 of the Protocol on China's Accession to the
WTO said that " [c]onsideration of issues pursuant to   this Section shall be without prejudice to rights
and obligations of any Member, including China, under the WTO Agreement or any Plurilateral Trade
Agreement".  This meant that the process of the TRM should not create any excessive burdens onIP/C/M/37/Add.1
Page 19
WTO Members, including China.  The ultimate obje ctive of the TRM was to facilitate and improve
China's implementation of the WTO agreements and its commitments under the Protocol.
95. The Chairman recalled that the Council had agreed that its normal review of China's TRIPS
implementation and the review under the transitional review mechanism would be combined and that
the normal review would be conducted following Council's standard procedures.
96. The Council took note of the statements made and agreed  to proceed as suggested by the
Chairman.
D. ISSUES RELATED TO THE EXTENSION OF THE PROTECTION OF GEOGRAPHICAL INDICATIONS
PROVIDED FOR IN ARTICLE 23 T O PRODUCTS OTHER THAN WINES AND SPIRITS
97. The Chairman recalled that, organized in paragraph 18 of the Doha Ministerial Declaration,
the Ministerial Conference had noted that "issues related to the extension of the protection of
geographical indications provided for in Article 23 to products other than wines and spirits will beaddressed in the Council for TRIPS pursuant to paragraph 12 of this Declaration".  Since its last
meeting, the Council had received a communication from Australia, Canada, Guatemala,
New Zealand, Paraguay, the Philippines and the United States on the implications of Article 23
(document IP/C/W/360).  In addition, the Council had just received a new communication from
Argentina, Australia, Canada, Chile, Chinese Taipei, the Dominican Republic, El Salvador,Guatemala, New Zealand, Paraguay, the Philippines and the United States on the same matter
(subsequently circulated in document IP/C/W/386).
98. As agreed by the Council at its last meeting, the Chairman had circulated a Checklist of Issues
(document JOB(02)/117) in order to have a more systematic discussion on this topic at the present
meeting.  In preparing it, he had taken into account not only the debates at the June and earliermeetings of the Council but also subsequent communications from delegations and issues raised at
informal consultations.  He pointed out that the purpose of the Checklist was not to limit discussion,
but rather to facilitate the debate and to do so in a more organized and systematic matter.
Consequently, he stressed that all issues of significant concern to delegations must be open to
discussion and that any checklist would necessarily be non-exhaustive.  Regarding the relationshipbetween the work under this agenda item and the work done under other agenda items and in other
fora, he said that the Council could not exclude issues that some delegations considered important in
relation to the Council's mandate.  In this regard the Council would have to make sure that when it
dealt with questions that were also being examined in other fora, it should take advantage of the work
done elsewhere, rather than duplicate it.  As to the timing, he recalled that the Council was required to
report on this matter to the TNC by the end of the year.  Thus, it was necessary that the Council timed
the consideration of the items of the Checklist so that they would have been discussed by that time.That meant, in practical terms, that the Council  had the present and November meetings for this
purpose.  If Members so wished and the meeting schedule permitted, an additional informal meeting
could also be organized.
99. He noted that he had grouped the issues raised into three categories:  The first concerned the
legal issues relating to the differences between the general protection for geographical indicationsprovided for in the TRIPS Agreement and the additional protection for GIs for wines and spirits. The
second related to broader policy questions such as the impact on producers and consumers of any
extended protection.  The third concerned the impact on governments, in particular the administrative
costs and burdens of the procedures associated with any extended protection.  He suggested that the
Council focus at the present meeting on the legal issues in the first category, given that they wereissues which Members were hopefully equipped to address at short notice, and also because clarity in
regard to these legal matters should contribute to a greater and better understanding of the possible
impact of extended protection and also of procedural matters, to be discussed at a second stage at theIP/C/M/37/Add.1
Page 20
November meeting.  The Checklist also referred to a number of issues that could be taken up under
the second and third baskets of issues in November.
100. Introducing the new communication from a number of developed and developing country
Members (subsequently circulated in document IP/C/W/386), the representative of Guatemala said
that the extension of Article 23 of the TRIPS Agreement to cover geographical indications for all
products had been promoted as providing  benefits to WTO Members and, surprisingly, had also been
promoted as a solution to what some regarded as unfair special treatment for geographical indications
for wines and spirits. Were both claims to be true, developed and developing country Members would
stand to gain much from these alleged benefits. For that reason, his delegation had reviewed proposals
aimed at extending Article 23 to geographical indications for products other than wines and spirits
with an eye toward gaining such benefits for its industries and consumers.  However, its review had
led it to conclude that extension would not provide meaningful benefits, but would instead create newtrade-related problems and difficulties. Not all WTO Members were producers or consumers of wine.
Given the nature of the Council's work and the discussions held by it, the fact that some WTO
Members had geographical indications for many products for which they sought additional protection,
while other Members had only a few, if any, geographical indications to which such additional
protection would apply was particularly relevant to  the discussion on extension although, at first
glance, it would have seemed beneficial to request an extension of Article 23 to geographical
indications for products other than wines and spirits.  A Member might only have a few geographical
indications for domestic products in which it was interested but it would be obliged to provide the
means to protect hundreds or thousands of geographical indications from Members with formal
systems for such indications.  Members needed to evaluate the true commercial opportunities theywould receive as a result of an extension of Article 23 compared with the protection they would have
to provide.  The problem that Guatemala had with access of its products did not necessarily stem from
difficulties with its geographical indications, but rather from other factors.  Many developing
countries would stand to benefit much more from greater market access and the dismantling of
protectionism than from the extension under discussion.
101. WTO Members that were looking towards extension of Article 23 to provide protection for
specific terms in the territories of other Members might discover that those terms did not receive
protection because other Members had concluded that the terms did not meet the definition of a
"geographical indication".  He was not sure as to whether all Members considered country names to
be eligible for protection as geographical indications.  Thus, it was unlikely that the extension of the
protection provided for in Article 23 to other products would provide the promised protection for all
terms in all WTO Members.  Geographical indications to which the exceptions under Article 24 did
not apply already received sufficient protection under Article 22.2, the provisions of which applied to
all geographical indications for all products of all WTO Members, and embodied the delicate balance
between the needs and aspirations of producers, consumers and public policies. Article 22 provided
for protection against misleading uses of geographical indications.  The standards of Article 22 could
ensure that geographical indications did not become generic, if they had not already become sothrough use that had been perfectly legitimate until now.
102. The promised benefits of an Article 23 extension would not be as comprehensive as some had
claimed.  These benefits would likely not be achieved because the terms for which protection was
sought did not qualify as geographical indications under the definition of Article 22, or because they
could be considered to be misleading to consumers, or because they would not be covered by anextension of Article 23 due to the fact that they were already under one of the Article 24 exceptions.
Some delegations had indicated certain terms for which they would have desired Article 23-level
protection. However, many of these terms were already generic in other countries.  Extension of
Article 23 would not provide protection for these terms because they would fall under the Article 24.6
exception for terms of customary usage and Members would not be obliged to protect them.Exceptions under Article 24.6 were established by each Member inside its own territory. A term
which was generic in one Member might be a protected geographical indication in another.  He notedIP/C/M/37/Add.1
Page 21
with concern that a bilateral agreement could make it difficult for producers in a Member where a
specific term was generic to export that product using the generic term to other markets.
103. He said that the new communication listed terms that had been mentioned in the TRIPS
Council as examples of terms that deserved as much protection as wines and spirits, and would only
receive such protection if the scope of Article 23 was extended.  Many of these terms weresufficiently protected under the Article 22 standard without any confusion or would not be eligible for
protection if Article 23 was extended. Although the document provided a number of examples, there
would be many more to come, especially from developing countries which lacked experience with
systems of protecting geographical indications.
104. Implementation of an extended Article 23 could involve major costs for governments,
manufacturers and consumers in the form of new administrative mechanisms to implement the
broadened standards, the need of re-labelling and repackaging, and the costs related to the confusionthis change would impinge on consumers who would no longer be able to find the products they were
accustomed to buy.
105. Concluding, the representative of Guatemala said that the extension of Article 23 to all goods
would not be the panacea that many Members had envisioned. The benefits of such an extension
would accrue to those WTO Members with many geographical indications protected under formalregistration systems monitored and enforced by th e government.  The burden would fall on those
Members with few, if any, geographical indications, on those that protected geographical indications
through trademark and unfair competition regimes, and on those with domestic food industries that
had for many years used, in marketing their products at home and abroad, geographical terms that
originated in countries from which the founders of those industries had emigrated in search of newopportunities.
106. Turning to the Checklist, the Chairman said th at the first topic that might be considered
among the legal issues involved issues relating to  protectable subject-matter. While some delegations
had expressed the view that this matter did not need discussion in this context given that no change to
the definition contained in Article 22.1 was envisaged, some other delegations had indicated that,given the different implications of extended protection, it was difficult to discuss this matter without
more information as to the nature and number of terms that might be eligible for protection, as well as
more information in regard to such matters as to the relative role of the country of origin and the
country where protection was sought in determining the criteria for eligibility of protection, the
eligibility of country names, non-place names and of so-called "traditional expressions", etc. The
second topic involved issues relating to the protec tion to be granted, including the difference in the
level of protection taking into account the exceptions provided for in Article 24, the difference in thetreatment of the relationship between trademarks and geographical indications, and the difference in
the treatment of homonymous geographical indications.  He added that these were only suggestions
on how the discussion could be organized.
107. The representative of Brazil said that her delegation was not a demandeur on the subject, but,
taking into account its commitment to discuss implementation issues, it wished to comment on the
current debate in the TRIPS Council on geographical indications.  The review of the implementation
by the WTO Secretariat offered comprehensive information on geographical indications from both the
legal and administrative points of view.  According to this document, geographical indications were
protected in different ways by different countries. Diverse legal means were used to implement the
TRIPS Agreement, ranging from trademarks to sui generis  legislation. While the information
contained in the note was useful for understanding how systems that provided protection for
geographical indications worked, many aspects still remained to be addressed.  Given that the
economic aspects extension had not been sufficiently studied, an economic and statistical analysis of
existing protected geographical indications would certainly be a helpful instrument in understanding
the real impact of such protection.  To date, no economic data or evidence had been provided aboutIP/C/M/37/Add.1
Page 22
gains, benefits and market shares for groups such as producers, distributors and consumers, among
others.  The economic value of protected geographical indications had not been quantified or well
estimated.  Furthermore, there was no evidence of alleged economic losses arising out of a weaker
level of protection.  Another aspect that deserved further analysis was the cost of maintaining a
system for the protection of geographical indications.  In this regard, Members seeking extensionshould provide more information on costs, particularly administrative and legal, as well as on
investment costs incurred by holders of protected geographical indications.
108. Another matter of particular interest to countries like Brazil that had benefited from the
historical influx of immigrants was the impact of extension on the cultural practices of their peoples.
Given that extension could lead to the disruption of  trade and even to market closure, she wondered
whether it would be legitimate to deprive these peoples from practices that were closely linked to their
cultural identity.
109. The representative of the Czech Republic said that extension would not have any implication
on the definition of Article 22.1.  The Czech Republic's aim was to ensure the application of the same
level of protection to all geographical indications falling under that definition of Article 22.1, which
itself applied to the Article 22 protection as well as to the Article 23 protection. In order to clarify her
statement, she proposed leaving Article 22.1 as it was and changing Article 23 as follows:
"Each Member shall provide the legal means for interested parties to prevent the use
of a geographical indication identifying goods for such goods not originating in the
place indicated by the geographical indication in question, even where the true origin
of the goods is indicated or the geographical indication is used in translation or
accompanied by expression such a kind, type, style, imitation or the like".
110. The representative of Australia congratulated the Chairman for his initiative in putting
forward a list of issues aiming at facilitating a more systematic discussion and agreed that the list was
meant to be non-exhaustive. One could get the impression from the Checklist that this exercise was
essentially about clarifying legal issues, the impact on producers and consumers, and the
administrative costs of possible additional protection. In his view, the issues went well beyond whatwas described in the Checklist. They went to the heart of trade policy issues and to consequences for
governments.
111. A week before the meeting a major report had been published by the Commission on
Intellectual Property Rights (CIPR)
2, which surveyed the promises and pitfalls of intellectual property
rights for developing countries.  Its central message, as portrayed by the media, was that developing
countries should avoid committing themselves to rich-world systems of IPR protection, unless such
systems were beneficial to their needs.  Nor, it suggested, should rich countries push for anythingstronger.  It was interesting that in this report, which was generally critical of the Agreement and the
costs of establishing intellectual property rights systems, when it addressed geographical indications it
said that "in our view it is far from clear whether these countries, developing countries, will be able to
gain significantly from the application of geographical indications".  It suggested that further research
was needed before developing countries should contemplate any new commitments, and this, as heunderstood it, was the approach Brazil had adopted.  In his view, there had not been a thorough airing
of the important policy implications of additional protection.  Some delegations had argued that equity
demanded that if additional protection for wines and spirits existed there should also be similar
protection for other products.  This completely ignored the fact that the bulk of Members made no
distinction between the protection of Article 22 and the protection of Article 23 in their home markets.It also ignored the fact that Article 23 protected one large group of wine producing countries at the
expense of new competitors. Why had all other wine producing nations expressed serious concerns at
                                                     
2 Integrating Intellectual Propert y Rights an Development Policy . Report of the Commission on
Intellectual Property Rights. London, September 2002.IP/C/M/37/Add.1
Page 23
the new wine regulations that had been introduced by one Member, under the partial guise of the
TRIPS Agreement, if they were happy with the way in which the so-called additional protection had
been implemented?  Additional protection merely meant that those countries which applied protection
at the border now wanted to apply protection extra-territorially.
112. The representative of Australia said that the use, in the Checklist of Issues, of the phrase "new
unauthorized usage of geographical indications" was inaccurate. Any decision about whether a
geographical indication was authorized or not was a decision to be made by individual Members in
the market concerned.  Like all other forms of intellectual property rights protection, such as patents
and copyrights, it was for national governments, not an international organization, to decide whether a
term was permitted or not.  If a Member wanted to exercise its rights under the DSU, it could do so,
but as he understood it there had not been one case in which the Appellate Body had declared that a
geographical indication was not authorized under the TRIPS Agreement. He also recalled that theArgentine delegation had asked at the last meeting that those demandeurs who had commonly used
the word "usurped" should not use that term and th e same should apply to any Secretariat paper which
mentioned unauthorized use of geographical indications.  This went to the wider issue of the framing
of some of the issues in the document and the characterization of respective positions. It was not clear
that there had been a ''fair amount of discussion" on the differences between the general level ofprotection and the additional level of protection or very much discussion at all on the adequacy of
Article 22-type protection. He concluded by saying  that Australia was ready to address the issues
identified in the Checklist, on the clear understanding that it would revert to them later on in the
meeting.
113. The representative of Bulgaria said that all the underlying basic arguments of the paper
presented by Guatemala were flawed.  The paper claimed that "apparently the term 'Bulgarian
yoghurt' is used as a generic term in France".  Contesting this claim, he noted that the term "Bulgarian
yoghurt" was not generic, only famous.  He recalled the mandate in paragraph 12 of the Doha
Ministerial Declaration, which spoke of the determ ination of the Ministers "to find appropriate
solutions" to the implementation issues, this being one  of them, and of the report to the TNC by the
end of 2002 "for appropriate action".  The situation about extension was not different from the one
about TRIPS and Public Health.  Therefore, Bulgaria believed that the work on extension should be
accelerated so that the Council would be able to arrive to an appropriate solution to be recommended
to the TNC by the end of this year.  He also seconded the Chairman's suggestion to hold an additional
meeting on the issues relating to extension.
114. The proponents of the extension had already given answers to the issues contained in the
Checklist in several submissions. In this regard, he disagreed with the statement of the representativeof Australia that the Council had not discussed these issues sufficiently;  on the contrary, there had
been substantial debates on all those issues.  Coming  to the first item under the legal issues, i.e. the
differences between the general protection under Article 22 and the additional protection under
Article 23, he said that this had been described as the starting-point of the debate about extension. It
was understandable why this was so, because the opponents of extension wanted a broad debate ofpolicy issues.  He could perfectly agree to discuss this item again, despite the fact that the Council had
already done it in the past, provided, however, th at this would not limit the discussions and,
particularly, would not prevent Members from focusing on the substantive issues regarding extension.
He also recalled that, from a chronological viewpoint, the differences mentioned in the Checklist had
never been the starting-point of the discussion.  The central differences were, instead, those betweenthe treatment of wine and spirits, on one hand, and the remaining other products on the other. So
Members should, in fact, focus their discussion not on the former differences but rather on the latter
ones.
115. It was difficult to understand why wines and spirits should be treated differently from other
products. Why the theft of oranges should be punished differently from the theft of apples?  Or whythe piracy of piano music should be treated differently from the piracy of violin music? There hadIP/C/M/37/Add.1
Page 24
been no convincing justification for this difference.  He noted that Article 22 prohibited the lying
about the origin of goods, whereas Article 23 prohibited the misuse of a reputation which belonged to
others.  Why did the proponents want the additional protection to be extended?  Or, as put by the
opponents of extension, why was Article 22-type protection insufficient?  Because the proponents
wanted to prevent not only the lying as to the orig in of the goods, but also the misuse of reputation
acquired by others, and also because the TRI PS Agreement provisions did not guarantee this
protection, contrary to what was said in the joint paper IP/C/W/360.  For example it was perfectly
legal under the TRIPS Agreement to sell yoghurt of Bulgarian taste, or taking another Bulgarian
product, to sell feta of Bulgarian type.  This was, he repeated, perfectly legal and it was absolutely
ineffective to apply Article 22 to prohibit the use of such expressions for those products. The
opponent's argument was that some countries had many geographical indications while some others
had only a few. He believed that this argument went against the very nature of the protection ofproperty rights, in general, and of intellectual property rights, in particular.  He wondered whether the
intent of the opponents of extension was to propose a change in the nature of the TRIPS Agreement
from a minimum standard of protection to the exchange of concessions and reciprocity, like it was the
case under GATT and GATS.  Did the United States, Australia and other opponents also want to
apply this same approach of reciprocity to trademarks, patents and copyrights?  For example, theUnited States seemed to have several million registered trademarks and patents.  Would the United
States agree that others would only protect a number of US patents equal to the number of their
patents protected in the United States?
116. In his view, the essential issue was not the existing number of terms but the interests of the
different countries, and, from this perspective, the fundamental question was whether there should bea difference between wines and spirits on the one hand (which were produced by some countries and
not by others) and other products on the other (in which other countries were especially interested).
In fact, there were no convincing justification for the existence of this difference.  It was also
important to note that the proposal to extend additional protection was directed to the future, i.e. it
would give a signal to work for the reputation of specific products in particular places and to look forniches in the market for such products .  Therefore, it was in the interest of all countries to have this
protection extended.
117. The proponents of the extension had not recommended any changes to the definition in
Article 22.1.  However, he wondered whether the opponents of the extension wanted to, e.g. exclude
country names, or propose something more specific on non-place names or traditional expressions?
From the viewpoint of both his country's proposal for extension and the Doha mandate on extension,
such questions pertaining to the nature of the additional protection were irrelevant and fell outside thescope of the mandate. Furthermore, traditional expressions were foreign to the extension debate
because they were a completely different kind of protection of intellectual property rights
118. The representative of Bulgaria said that his proposal regarding extension was exactly the
same as that by the representative of the Czech Republic, i.e. that the reference to "wines and spirits"
should be deleted from the heading of Article 23 heading and that the expressions "wines for suchwines" and "spirits for such spirits" in paragraph 1 of the same Article should be, respectively,
replaced by the expression "goods for such goods" and deleted from the text.  The exceptions of
Article 24 should apply to the extended product coverage.  As to the second point for discussion,
i.e. the difference of treatment of the relationship between trademarks and geographical indications,
he said that this question was covered by the joint proposal presented by Bulgaria and other co-sponsors in June 2002 (document IP/C/W/353) and in this regard it was proposed as follows: the first
reference to "wines" in paragraph 2 of Article 23 had to be replaced by a reference to "goods" and the
second reference to "wines" had to be replaced with the expression "such goods".  Furthermore, the
reference to "spirits" had to be deleted and the third reference to "wines or spirits" had to be replace to
a reference to "goods".  Finally, commenting on the third point of discussion, which referred toIP/C/M/37/Add.1
Page 25
homonymous geographical indications, he proposed a change in paragraph 3 of Article 23, which
consisted in deleting the reference to "wines" and replacing it with the words "the same good".3
119. The representative of the Kyrgyz Republic said that he supported the work on the extension of
additional protection of geographical indications to products other than wines and spirits.  An
appropriate and balanced solution was being sought by all to this complex issue, which involvedmany aspects of life, such as historical heritage and economic sustainability.  Fairer practices in trade
at national, regional and, above all, international level, should exist in order to promote competition
and investment flows.  The use of the word "territory" in the definition of geographical indications led
one think about future applications of this term in a broader context, which could eventually cause
misunderstandings among Members.  For example, the Kyrgyz "Uzgen rice", was an unique grain
because of its red color and taste.  Was it a product originating in the Kyrgyz Republic?  One could
answer that question in the affirmative, but woul d it be also possible to say that all the Kyrgyz
products were "Uzgen rice"?  He believed that that was not the case.  Nevertheless, he was of the view
that geographical indications of several small islands, or inland territories, could be attributed to
products where special characteristics were indeed distinct from the same products.  This made it
necessary for the work to proceed on a case-by-case basis.  He urged the Council to clarify the
definition of geographical indications so as to allow it to develop a common solution as soon aspossible.
120. The representative of Canada said the her delegation was pleased to co-sponsor the paper
introduced by Guatemala and fully associated herself with Guatemala's remarks. Reacting to the
suggestions by other Members to insert new language to Article 23, she said that this was rather
premature because the Council was far from concludi ng that any extension was even required. She
also thanked the Chairman for the preparation the Checklist of Issues as a means of facilitating the
present discussion. Although there were other issues that could be added to the Checklist, she believed
that it would be a useful tool, as it had been the case in other areas of discussion. She also said that
there was merit in gathering empirical data regarding the protection of geographical indications, as
had been suggested by Brazil, and, in this regard, her delegation desired to consider how it couldaccomplish this objective, even if only to provide some factual evidence.
                                                     
3 To illustrate these proposed changes, the representati ve of Bulgaria provided the following text to be
included into the minutes of the meeting:
Proposed changes to Article 23 of the TRIPS Agreement
Article 23
Additional Protection for Geographical Indications  for Wines and Spirits
1. Each Member shall provide the legal means for in terested parties to prevent use of a geographical
indication identifying wines for wines not originating in the place indicated by the geographical indication in
question or identifying spirits for spirits  goods for such goods not originating in the place indicated by the
geographical indication in question, even where the true origin of the goods is indicated or the geographical
indication is used in translation or acco mpanied by expressions such as "kind", "type", "style", "imitation" or the
like.
2.  The registration of a trademark for wines  goods which contains or consists of a geographical
indication identifying wines or for spirits which contains or consists of a geographical indication identifying
spirits  such goods  shall be refused or invalidated, ex officio  if a Member's legislation so permits or at the request
of an interested party, with respect to such wines or spirits  goods  not having this origin.
3.  In the case of homonymous geographical indications for wines  the same goods  protection shall be
accorded to each indication, subject to the provisions of paragraph 4 of Article 22. Each Member shall
determine the practical conditions under which the homonymous indications in question will be differentiated
from each other, taking into account the need to ensure  equitable treatment of the producers concerned and that
consumers are not misled.IP/C/M/37/Add.1
Page 26
121. With regard to the legal differences between the levels of protection provided by Articles 22
and 23, she said that Canada remained convinced that the level of protection offered by Article 22 was
not only sufficient for all GI products, but also the most appropriate mechanism.  What was still not
clear, and had not been demonstrated, however, was why the protection of Article 22 was not
sufficient.  She invited again delegations to provide the Council with concrete examples of theproblems they had had, or were currently encountering, in obtaining satisfactory protection under
Article 22.  The work of the Council would be greatly facilitated if examples were put on the table.
122. The same could be said of Article 23 because, while wines and spirits, de jure,  benefited from
the additional level of protection for their geographical indications, de facto , there was no evidence
that this was the case.  The Council's discussions on the respective levels of protection granted under
Articles 22 and 23 had revealed that a misconception concerning the extent of the protection of
Article 23 was still prevalent.  According to her interpretation, Article 23 conferred exclusive rightsover a particular geographical indication to one group of producers, effectively depriving others of the
right to use that geographical indication.  Unli ke Article 22, which stated that Members should
provide a legal means to prevent the use of geographical indications in a manner that misled the
public as to the geographical origin of the good or in any way that constituted an act of unfair
competition, Article 23 had no such requirement.  Extending Article 23 would certainly not providethe following things: market access, a balanced ge ographical indications regime, and the renegotiation
of the exceptions.
123. As to the question of market access, she said that it was not the role of intellectual property
rights to provide it, and this was certainly not the intent of Article 23. Recalling that during the
Council's previous meeting, Canada's experience with  the application of Article 23 had been briefly
addressed, she said that, as mentioned on that occasion, many technical requirements could prevent
access to a given market, such as the requirements addressing product standards and grading,
packaging and labelling, health and safety and food additives. Intellectual property rights could not
abrogate any of these requirements.  In the case of wine, for example, geographical indications would
not guarantee market access.  In fact, in Canada's case, geographical indications had done nothing toassist it in gaining access for its wines into the European Union.  Its access had been blocked by a
number of factors, including differences in oenological practices, and labelling regulations.  The same
would apply to other products. Canada, for example, had product regulations for canned fruit, fresh
and frozen fruit, fresh and frozen vegetables, fruit juices, tomato paste, ketchup, spaghetti sauce and
pizza sauce, just to name a few.  If import requirements were not met, a product could not enter a
country, regardless of whether or not it was a registered geographical indication in that country.
124. Regarding the questions about imbalance, she stated that some Members had argued that an
imbalance existed between the protection granted by Articles 22 and 23. However, while this could be
true in theory, in practice this did not appear to be the case. In fact, a real imbalance was more likely
to arise out of the extension of Article 23. As it had been said in previous meetings, most Members
had a limited number of indications they would want to see protected. In Canada, for instance, only
seven geographical indications for wine had been registered. By contrast, in bilateral negotiations, theEuropean Communities were seeking protection for close to 10,000 geographical indications, 95% of
which had no commercial value in Canada. Consequently Canada believed that the same disparities,
not balance, would appear if extension were to be granted to other products beyond wine and spirits.
125. With respect to the exceptions provided under Article 24, it had been suggested that a
derogation or abrogation of some of those exceptions could accompany the extension of Article 23.Canada did not see any reason for changing the scope of the exceptions for other products. She also
noted that Canada would consider most of the notable examples that had been given in the Council as
being generic names.  She wondered what exactly was the benefit that Members expected to get with
an extension that was not already available to them under Article 22.  This seemed to be the
underlying question that the Council continued to grapple with.  Concluding, she asked all Membersto consider why it was that all New World wine producers, collectively, were against the extension ofIP/C/M/37/Add.1
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the protection provided for in Article 23 to other products?  There seemed to be hidden questions
within that.
126. The representative of Uruguay said that document IP/C/W/360 contained many points
supported by her delegation in previous meetings. She was convinced that extension, as such, would
not constitute for countries like Uruguay a guarantee of market access or an automatic increase ofexports.  If it was true that, on one hand, it would be possible to have exclusive rights over some
specific products, it was no less true, on the other, that this could also result in the impossibility of
exporting products under some given names, which were brought by the migratory flows to some
countries in the beginning of the last century.  The terms and names which were used to designate
some given products and which remained in use were a consequence of the cultural tradition that
came along with immigration.  What Uruguay proposed, then, was a cost-benefit exercise, i.e. one in
which the Council should pay special attention to the fact that a possible extension could also closethe doors for traditional and growing industries.  In this regard, she reminded Members that,
according to the definition contained in Article 22 of the TRIPS Agreement, for an indication to be
considered a geographical indication, it was not enough just to have a geographical origin. In addition,
the product identified by such an indication needed to have some characteristics related to the
reputation and quality, which were attributable to its geographical origin.  These two words,"reputation" and "quality", were very significant.  They were characteristics that could not be attained
just from one day to the next.  So, in order to obtain protection for geographical indications it was
necessary to demonstrate that a given product complied with that definition.  It was difficult to believe
that countries which did not have geographical indications would be able to obtain protection in a
short period of time.  On the contrary, geographi cal indications would not bring immediate solutions.
Uruguay would not like to see geographical indications becoming a new mechanism of protectionism,
acting as a barrier to the access of its products to the international markets.
127. Her delegation was aware that Articles 22 and 23 granted a level of protection to wines and
spirits which was different from the level of protection provided for other products.  However, she
could not to accept the argument according to which the protection provided for in Article 22 toproducts other than wines and spirits was not adequate.  She reminded Members that the language of
Article 23 resulted from the negotiations of the Uruguay Round and that this language was accepted
by her country as part of the negotiation package. Concerning costs, she shared the view, expressed in
document IP/C/W/360, according to which a proposed extension would create disproportionate costs
for countries that, like Uruguay, had very few or no geographical indications, and would, on the
contrary, force them to give additional protection for geographical indications originated from a group
of countries having hundreds or thousands of such indications.  Therefore, her delegation did not seethe benefit of the extension and considered that the Council had to continue studying each point in
depth before turning to the next step.  Finally, regarding the suggestion presented by the Bulgarian
and Czech delegations, she agreed with the Canadian delegation that it was still premature to discuss
any new language for Article 23.
128. Welcoming and supporting the Chairman's proposal to structure the discussion under agenda
item D according to a checklist of key issues, the representative of Switzerland said that it was
instrumental to organize the Council's disc ussion on every issue, including extension, more
thoroughly, in order to fulfill its task of making  a recommendation for appropriate action to the TNC
by the year's end.  However, this would only be possible if Members in their interventions would stick
to questions that were relevant to the issue of exte nsion.  Looking at the heavily charged agenda of the
TRIPS Council, he believed that neither the Chairman, the delegations nor the Secretariat had the time
or resources for any duplication of work, if such work already under way in the Council under other
agenda items or in fora outside the WTO, such as, in particular, the Standing Committee on the Law
of Trademarks, Industrial Designs and Geographical Indications (SCT) of the WIPO.
129. He recalled that at the Council's last meeting, those delegations in favour of extension, among
them Switzerland, had submitted a fourth detailed communication on the extension of the additionalIP/C/M/37/Add.1
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protection of geographical indications to products other than wines and spirits (document
IP/C/W/353).  This communication discussed various  aspects of extension by highlighting how it
could be enshrined in Section 3 of the TRIPS Agreement and presented a proposal to be included in
the report of the TRIPS Council to the TNC.  Th is communication, therefore, addressed exactly the
type of questions mentioned by the Chairman under the three bullet points of legal issues and shouldbe the focus of the discussion under way in the present meeting.  Detailed answers to the questions
raised at the Council's last meeting, which were again raised in document IP/C/W/360, could be found
in the four communications that had been presented by the delegations in favour of extension during
the course of the last two years.  For this reason his delegation did not want to repeat at length all the
reasoning already contained in those four documents (IP/C/W/204/ Rev.1, IP/C/W/247/Rev.1,
IP/C/W/308/Rev.1 and IP/C/W/353).  He felt that the debate had reached a stage in which substantive
progress needed to be made.  However, in the light of some of the opponents' comments, he felt that"demystification" of not only of patents but also of geographical indications might be needed.
130. The co-sponsors of communication IP/C/W/360 had concluded that extension "will not
provide meaningful benefits but will instead create new difficulties".  Delegations critical of extension
claimed that there existed an "imbalance" regarding the number of geographical indications to be
protected.  Their agreement that some Members called more geographical indications their own thanothers was true.  However, the same was also true with regard to patents and trademarks.  To his
knowledge, none of the delegations against extension had ever used this argument as a basis for
claiming that an adequate and effective protection of patents and trademarks resulted in an imbalance
of rights and obligations.  The fact that some Members had more geographical indications than others
was simply due to the fact that the former had recognized earlier than the latter the potentialmarketing value that a geographical indication could add to a given product. Therefore, they had
started to invest earlier and in a more sustainable manner in the development of their geographical
indications. Members having a longer tradition in the protection of geographical indications also had
more geographical indications which were recognized and protected than those which were just
beginning to discover geographical indications as a marketing tool for their own products in theinternational market.  This state of things had been, and continued to be, very similar to other
intellectual property rights.  It was also crucial at this very stage that both developing and developed
country Members, which wanted the benefits provided for in the GI-related TRIPS provisions to be
available to their own goods, would be given effective  protection for the geographical indications
associated with these products, which were by far not  only wines and spirits.  Otherwise, they would
justifiably feel discouraged to make the effort to foster geographical indication protection at their
national level.  It was not so much the number of geographical indications that counted whenassessing the merits of a better protection, but rather the economic value or the potential value of each
well-protected geographical indication. Often, one particular geographical indication had been
considered more valuable than one hundred other geographical indications.  One example of a
valuable geographical indication was "Tequila" for a Mexican spirit. With globalization, the interest
of having an effective protection for these kinds of signs had increased considerably at theinternational level, as demonstrated by the size of  the list of delegations in favour of extension.
131. After citing Swiss cheese "Etivaz" as a recent example of how a geographical indication
became "famous" in just a short time, the representative of Switzerland posed the following question:
Who would really have known some time ago of th e existence of such indication outside Switzerland
or perhaps Europe? Nowadays, this was no longer the case and even the co-sponsors ofcommunication IP/C/W/360 mentioned this geographical indication in their submission. This cheese
and its geographical indication were therefore currently familiar to 144 WTO delegations and beyond.
This example served to illustrate that nowadays, thanks to globalization and the fast flow of goods and
information, awareness of the public of a specific geographical indication and a particular product
could develop very quickly, and was an increasing tendency in the future. This was the reason why itwas important for the WTO to have effective means of protection for geographical indications at the
international level, extension being the solution that would provide such effective protection.IP/C/M/37/Add.1
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132. Reacting to the fears expressed by the opponents of the extension regarding the consequences
of extension on the future of their traditions and the exceptions under Article 24 of the TRIPS
Agreement, he asked them to once again read paragraphs 15 and 16 of communication
IP/C/W/308/Rev.1 and paragraphs 35 to 39 of communication IP/C/W/353, in which it was proposed
that the current exceptions for wines and spirits should also exist for products for which additionalprotection should be extended.
133. Responding to the opponents' argument that gene ric indications would nullify the benefits of
extension for certain geographical indications, he said that if a geographical indication should prove to
have become generic in one Member, this did not mean that it had lost all its economic value in other
countries.  As mentioned in the communication IP/C/W/360, exceptions applied on a per-Member
basis, which meant that extension would offer legitimate producers an effective legal means to enable
them to prevent the "degeneration" of their geographical indications in new markets.  He concludedby saying that "fair trade" was a term used more and more in relation to globalization, and in
particular with regard to trade from the developing to the developed world.  Extension was certainly
not the answer to all the questions relating to "fair trade", but it certainly was one part of this big
picture.
134. The representative of Kenya said that the Chairman's Checklist of Issues was helpful in
facilitating a more systematic discussion.  He advised the Council to consider requesting the WIPO to
provide information on three particular issues, namely on protectable subject-matter, the relationship
between trademarks and geographical indications and the treatment of homonymous geographical
indications.  This would enable the Council to concentrate on other issues that were directly related to
the extension, like the difference in the level of protection between Articles 22 and 23 and the impactof extension on producers and consumers as well as on governments.
135. The representative of Jamaica wondered whether the opponents of extension were proposing
that the link between a product and its geographical origin did not need to be established? If that was
the case, then they were seeking to negate the very essence of what constituted a geographical
indication, the definition of which was enshrined in Article 22.1 of the TRIPS Agreement. Indocument IP/C/W/360, particularly on issue 2, paragraph 5, on "the definition of geographical
indication", a number of concerns had been raised.  It was not clear to her why the definition of
geographical indications had been considered a barrier and why concerns regarding the definition still
persisted.  As the representative of Bulgaria had mentioned earlier, these concerns had already been
addressed by the proponents of the extension.  She draw the attention of the Members to
communication IP/C/W/353, paragraph 6, which stated that "the definition of geographical indications
according to Article 22.1 applies to any geographical indication irrespective of the product concernedand irrespective of whether the protection level of Article 22 or 23 applies".  The question of the
definition was therefore not a question specific to extension but one of general bearing within the
context of the protection of geographical indications.  However, if delegations felt it was necessary to
further discuss this issue, they could do so under agenda item M on the built-in review provided in
Article 24.2 of the TRIPS Agreement.
136. Notwithstanding this, she wished to address th ree points which had been consistently raised
by some delegations in the context of the definition of geographical indications. In her view, names of
countries were, in principle, eligible to qualify as geographical indications, provided that they met the
requirements of Article 22.1, i.e. that that they identified a product as originating from the territory of
that given Member;  and where a given quality, reputation or other characteristic of the good wasessentially attributable to its geographical origin.  Examples of such geographical names were
"Luxembourg" for meat products or "Swiss" for watches. Secondly, not only geographical names
were covered by the definition of Article 22.1 of the TRIPS Agreement, but also the so-called
"traditional designations". In the Checklist of Issues theses indications were referred to as "non-place
names". "Traditional designations" were names which did not correspond to a geographical name, butwhich did entail a geographical reference, since they were only used according to a practice or aIP/C/M/37/Add.1
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regulation for products that had a precise origin conferring them a given quality, reputation or other
characteristic. Examples of "traditional designations" were "Tête de Moine" for a Swiss traditional
cheese and "Basmati" for rice from the sub-Himalayan region of the Indian sub-continent. Such
"traditional designations", or non-place names, were to be distinguished from "traditional
expressions" or "traditional methods", which entailed no geographical reference and were thereforeoutside the definition of Article 22.1 of the TRIPS Agreement. Thirdly, she recalled that a
geographical indication could also exist as a symbol or an emblem, such as the "Taj-Mahal" to
designate Indian products of that region, or the "E iffel Tower" for products from the region of Paris,
or the " map of Jamaica ", to designate coffee or sugar originated from that country.
137. The TRIPS Agreement gave Members clear guidance in respect of the definition of
geographical indications and could therefore help to harmonize the national concepts and definitions
of geographical indications. This was exactly the reason why the delegations in favour of extensionadvocated this issue in the framework and why it was, therefore, of paramount importance for the
TRIPS Agreement to provide for an effective and balanced protection for geographical indications.
She also recalled, in this context, that Article 1.1 of the Agreement gave Members the freedom to
determine how they would implement the TRIPS prov isions within their legal system and practice,
according to the method they think appropriate .  In conclusion, commenting on the changes to
Article 23 of the TRIPS Agreement suggested by the representative of Bulgaria, she said that her
delegation supported them and considered them to be a positive step to the right direction.
138. Noting that this was the first time China was taking the floor on the issue of geographical
indications, the representative of China said that, in principle, her delegation endorsed the proposal
made by several Members on the extension of the protection of geographical indications provided for
in Article 23 of the Agreement to products other than wines and spirits. The rationale behind this
position was that the multilateral trading system should exist for the benefit of all Members and that it
should also maintain the balance of interests between different goods among Members. If the
producers of wines and spirits could enjoy the level of protection in accordance to Article 23, why the
producers and traders of other products could not also be protected under that same provision? Thatwas the simple reason why China supported extension. However, her delegation also has several
concerns.
139. First of all, according to Article 23, the scope of protection after extension would cover
translations of geographical indications.  At first, her delegation thought that the Chinese language
could be easily distinguished from other languages, thus making any conflicts with foreign names
unlikely. However, a large number of Chinese terms would be excluded from further use on products
and services due to the simple fact that their equivalents in either English, Spanish or other languageswould be recognized as geographical indications.  Consequently, this would result in many difficulties
in China. Secondly, pursuant to Article 24.6 of the TRIPS Agreement, if a geographical indication
was determined to be identical with a generic term or with a term customary in common language as a
common name for goods and services in the territory of a given Member, then such Member would
not have the obligation to protect that geographical indication.  However, since there were no rules onhow one could make such determination, it would be difficult for the relevant authority to deal with
the conflict of rights between geographical indications and generic terms.  Thirdly, if a given
geographical indication were not being used for a certain consecutive period of time, e.g. for three
years, within the territory of a Member, it could be revoked by the relevant authorities in the same
manner as provided in trademark laws.  Fourthly, if a given geographical indication conflicted with atrademark, or a name of an enterprise, or any ot her trade name, how would the rules deal with these
kinds of conflicts? Would the exception for "prior use" be recognized?
140. These issues needed to be dealt with when addressing extension, otherwise it could end up
being a source of uncertainty and unpredictability for the multilateral trading system.  Since China
had a relatively long history, many local geographical indications had been cultivated during theformation process of its culture and civilization.  That was the reason why China was a stakeholder onIP/C/M/37/Add.1
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the issue of geographical indications.  Thus, her delegation would like to cooperate with all Members
to find a balanced, economically sound and legally predictable solution for this issue.
141. The representative of Korea said that his delegation would be pleased to engage in the
discussions in the way suggested in the Checklist of Issues.  He believed that it was important to
enhance a common understanding of the definition in Article 22.1.  The issues raised by someMembers, such as country names and non-place names, highlighted such need.  In comparison to
wines, which had been mostly protected by indications of source or by appellations of origin and
strictly controlled by the respective governme nts or communities in some European countries,
products other than wines had been usually protected by trademarks and had no collective control
system.  Therefore, the interpretation of the definition and the way of determining which geographical
indications identifying products other than wines and spirits would be eligible for protection was not
an easy task, and appeared to cause much confusion for producers and consumers alike.  One of themain differences between general protection and ad ditional protection was the existence of conditions
regarding misleading the public.  It had been often claimed that the general level of protection would
not be sufficient because it would place the bu rden of proof on the owner of the geographical
indication.  However, he wished to hear more explanations as to the inadequacy of such general level
of protection.  In most countries, trademarks had to be registered pursuant to the country's nationallaws and regulations in order to be able to enjoy protection in that territory.  On the other hand, there
did not yet exist such globally established practices or principles concerning geographical indications.
The extension would, in accordance with Article 23.2, force Members to reconsider the status of their
registered trademarks.
142. The representative of the European Communities said that he very much supported the
Chairman's efforts to engage all Members in a constructive discussion on this matter. Some
delegations had indicated that the Checklist would not stop them from raising other matters. The
communication introduced that morning raised more questions than answers, and probably questions
that were not very relevant to finding a solution.  It also appeared that it did not take account of the
detailed information already presented by many delegations.  He was ready to continue the debate onall relevant issues, but the Council should avoid duplicating other discussions that were taking place
in the context of the TRIPS Agreement or in ot her fora.  He then highlighted the main points
discussed in his written statement including, inter alia , the issue of imbalance in numbers, registration
systems and national treatment, the rule of the country of origin and principle of territoriality, country
names, non-geographical names as geographical indications, and traditional expressions.  As
requested by the delegation of the European Commun ities, its full written statement is reproduced in
an Annex to these minutes.
143. The representative of Chile recalled that his delegation was a co-sponsor of document
IP/C/W/360, and associated himself with the statem ent by the representative of Australia regarding
non-authorized uses.  It was argued by the repres entative of Bulgaria and in document IP/C/W/353
that "currently no economic or systemic reason existed to protect the geographical indications of
certain products in a different manner than others". Chile was in agreement with this assertion.Nevertheless, his delegation regretted that those who now supported the Bulgarian proposal had not
asked themselves that question years ago when the additional protection for wines and spirits was
negotiated during the Uruguay Round.  At that time there had also been no reason to discriminate in
favour of certain products to the disadvantage of others.  However, that discrimination was
established in Article 23 and currently there were two distinct regimes for one category of intellectualproperty.  Although his delegation believed that there were no differences between wines and spirits
and other products, it did not believe that the solution would be to extend the additional protection of
Article 23 to all types of products.  The additional protection was not achieved at the urging of the
countries that now supported his delegation's proposal, rather, it was achieved at the urging of those
sponsoring the proposal for the extension of protection.  The real reasons behind wanting to extendprotection to other products were the same ones that those countries had had when they pushed forIP/C/M/37/Add.1
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additional protection for wines and spirits.  Those were the real reasons and not the reasons of balance
between developed and developing countries.
144. Since his delegation was not in favour of discri minating among different types of products, it
was also not in favour of discriminating between different categories of intellectual property.  He
could not see a reason for eliminating the requirements for the general protection of Article 22, i.e. the
need to prove that the public was misled or that unfair competition had been incurred, and not to do
this, for instance, with trademarks. His delegation had not heard sufficient reasons to grant such
strong protection to a specific category of intellectual property and not to grant something similar to
another category.  It had been argued that the requirement to prove that "the public had been misled"
led to legal uncertainty and judges could reach differing solutions in similar cases. This argument
could lead to the absurdity of saying that fair use exception in the area of copyright should be
eliminated or that the possibility of granting compulsory licences for patents should be abolished,because they could produce legal uncertainty among right-holders and because judges might reach
diverging decisions each time they evaluated such cases.
145. He stated that the exceptions included in the TRIPS Agreement had been very well thought
out at the time they were drafted.  Eliminating them would create uncertainty not only among
consumers but also among those that had being using such denominations for many years.  It was notclear to him how the exceptions of Article 24 would work in conjunction with the proposal by
Bulgaria.  He did not agree with tightening the protection standards of geographical indications
because of a problem that probably had more to do with implementation than with lack of protection.
He also disagreed with Bulgaria's assertion about the need to prevent someone from taking advantage
of the reputation created by others.  In his vi ew, often those who would take advantage of the
reputation created by others were the same ones who would sought the relinquishment of long-used
denominations.  For these reasons and those presented in his delegation's document, he was not in
favour of extension.  Nor was his delegation in agreement with the drafting of alternative language to
the current language of the Agreement.  Finally, he said that he was not aware of the legislation to
which the representative of the European Communities had referred.  As far as he knew, Chile hadprovided protection precisely as required by the TRIPS Agreement, and differentiated between wines
and spirits and other products.
146. The representative of Hungary said he was in a fortunate position because the four papers
previously submitted by the proponents of extension on this matter, the most recent being document
IP/C/W/353, had already extensively dealt with the legal issues.  Responding to the comments by
certain developed country delegations that extension was not in the interest of developing countries,
he noted that document IP/C/W/353 was co-sponsored by 35 WTO Members, including a significantnumber of countries that did not fall under the developed category.  He stated that perhaps it should be
left to individual Members to say what was in their interest and what was not.  Turning to the issue of
protectable subject-matter, he said that, as the proponents of extension had unambiguously indicated
in writing, most recently in paragraph 8 of document IP/C/W/353, extension would have absolutely
no implication for the definition of geographical indications in Article 22.1 of the TRIPS Agreement.Demandeurs did not want to change the definition in this provision; the debate was simply about
increasing the level of protection currently availabl e for products other than wines and spirits to the
level of Article 23. Since no changes were sought to the definition, which was applicable to both of
those products that enjoy Article 22-level protection only as well as to wines and spirits, questions
related to the definition did not seem to be relevant to the debate over extension.
147. He said that, nevertheless, given the many questions posed by some opponents in the TRIPS
Council, as well as in the Special Session, demandeurs had made clear (e.g. in paragraph 7 of
document IP/C/W/353 or in their interventions at th e last Special Session, the record of which could
be found in TN/IP/M/2, paragraphs 26-64) that the names of localities, regions and even countries
could be geographical indications under Article 22.1, provided that they met the conditions set outtherein, in particular regarding the existence of  a link between the quality, reputation or otherIP/C/M/37/Add.1
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characteristics of a product and its geographical origin. He clarified that any name or sign that
conveyed geographical origin and fit the definition in Article 22.1 was eligible for protection as a
geographical indication. Because of the necessity to establish the linkage between the quality,
reputation and other characteristics and the geographical origin of goods, the question of whether a
certain name fit the definition could only be determined on a case-by-case basis, taking into accountall the relevant specifics of individual situations.  He thought that many of the misunderstandings
regarding which names or signs would or would not fit the definition in Article 22.1 could be traced
back to a failure to keep in mind the importance of this linkage.  He emphasized that rules of origin or
indications of source and geographical indications should not be mixed and that the former, i.e. rules
of origin and indications of source, did not indicate any quality, reputation or other characteristic and
served a completely different purpose.
148. He said that it was argued in document IP/C/W/360 that there was an imbalance in numbers:
some Members had geographical indications for many products, while others had only a few.  The
conclusion this paper seemed to suggest was that the sheer difference in numbers in itself was a
sufficiently clear indication of who would benefit from extension.  He agreed with the point made by
the European Communities, according to which the number of geographical indications protected at
home, for example through a register, and the number of instances when right-holders actually wentabroad to use the legal means WTO Members were obliged to provide under Articles 22 and 23, were
completely separate issues.  The approach in IP/C/W /360 lost sight of the fact that the economic value
of individual geographical indications could vary quite significantly. The economic value of a world-
famous indication used in relation to, for example, a speciality food product, especially if the
production area was considerable in size, could be far larger than the total value of a large number ofindications used in relation to products known in their own home country only. He clarified that such
an assessment could only be done country by country, taking into account the individual market
situations and consumption patterns.  In other words, the assessment of the potential economic impact
of extension was perhaps a little more complex an issue than what document IP/C/W/360 seemed to
suggest.  In response to earlier comments by Brazil, he stated that for these reasons, it seemed verydifficult, if not impossible, to put a figure to how much an individual geographical indication was
worth.  In particular, it would be very difficult to  quantify the difference between the two levels of
protection in terms of economic value.
149. He was somewhat surprised to hear the ar gumentation on numbers from some of the
co-sponsors of document IP/C/W/360 that were normally demandeurs in the intellectual property field
and who, to his delegation's best recollection, did not raise similar concerns, for example, when the
introduction of product patent protection for pharmaceuticals was discussed in the Uruguay Roundnegotiations. He quoted the following excerpt from a recent WTO document prepared for the
Working Group on Trade and Investment (WT/WGTI/W/136, in particular paragraphs 5 and 6):
"While developing countries and countries in Central and Eastern Europe increased their share of
patents registered in the United States from 1.5% in 1977-82 to 3% in 1990-96, the bulk of the 3%
share was accounted for by Korea and Chinese Taipei".  To put these figures into perspective he alsoquoted another excerpt from the same paper, which said that the top ten developed countries in terms
of R&D expenditure (amounting to 84% of the world total in 1993) took out close to 92% of all
patents in the United States in 1995-98.  He emphasized that he was not attacking patent protection,
but simply asking delegations to show consistency in their argumentation.
150. He noted that the exceptions in Article 24 (relating to prior use, good faith, prior application
for and acquisition of trademarks, and generic expressions) were equally applicable to Articles 22 and
23 levels of protection. The demandeurs, in paragraph 41(b) of IP/C/W/353, had confirmed that the
exceptions contained in Article 24 should apply mutatis mutandis . This showed that extension was
essentially for the future, which should ease the concerns of those that had not yet been convinced of
its desirability. The grandfathering exception was of particular relevance in light of the importantagricultural non-trade concern, namely, the preservation of cultural identity, which was raised orally
and in writing in IP/C/W/360 by a significant number of agricultural exporters. He failed to see howIP/C/M/37/Add.1
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the continued availability of all the exceptions, including the grandfathering exception, would not
adequately take care of that concern, unless the countries in question were expecting new, large-scale
immigration flows, especially from regions from which they had not already welcomed immigrants.
151. Commenting on homonymous geographical indications discussed in paragraphs 21-29 of
IP/C/W/353, he stated that Article 23.3 specifically covered the case of homonyms geographicalindications for wines whose use did not represent to the public that the good had originated from
another territory, as provided in Article 22.4. In such cases both indications had to be protected, and
the WTO Members concerned had to determine the conditions necessary to differentiate homonymous
indications for wines. In doing so, they had to ensure that consumers were not misled and that the
producers concerned were treated equitably. What did this imply? In his view, this implied that WTO
Members had to keep their respective markets open in cases of homonymous geographical
indications, and this called for an ad hoc  solution to ensure the coexistence of products bearing these
geographical indications. This provision in Article 23.3 was especially drafted to deal with the effects
of historical colonization or immigration flows in terms of their resulting city, region and locality
names that were identical to the ones used in the home countries of immigrants. He believed that this
provision provided additional proof that extension was not irreconcilable with the idea of adequately
addressing genuine concerns related to the preservation of cultural diversity. He emphasized,however, that keeping the possibility open for domestic manufacturers to start selling products under
names that free-ride under the geographical indications of others, did not seem to fall within these
legitimate concerns.
152. Responding to the delegation of Jamaica, the representative of Australia said that the Council
had agreed that the definition of a geographical indication clearly encompassed country names. But he
was puzzled by the unequivocal assurance, accompanied by some examples, made by the
representative of the European Communities during this meeting, according to which a country name
did fit into the definition of geographical indications. He was perplexed with the difference between
the rhetoric of what the European Communities said and the reality of what it practised, as illustrated
by EC Regulation 2081/92, which referred to geographical indications for a country "in exceptionalcircumstances".  Additionally, a recent EC wine  regulation (Regulation 753/2002) stated that
imported wines with indications "serving exceptiona lly to identify a wine as originating in the
territory of a third country could only be used if they were listed in Annex IV of the Regulation".
However, Annex IV was a blank page with no country listed on it. In this regard, he posed the
following questions: As a matter of practice, and also bearing in mind what the European
Communities and other demandeurs of extension and of an international register wanted, would terms
like "Bulgarian yoghurt", "Jasmin rice", "Chinese tea", "Kenyan coffee", "Hungarian salami" or"Jamaican rum" be allowed to be registered as country geographical indications? In practice, would
claims to protect Thailand or China, or whatever other country name, be accepted irrespective of the
product to which the Member sought to attach that name?  Or, would this only happen in the most
exceptional circumstances? And, if so, what were they?  He also recalled that, in the case of wine, no
country with which the European Communities had a bilateral TRIPS-plus agreement had beenallowed to use the name of their country as a name for wine. In others words, one would not be
permitted to use, e.g. "Australian Chardonnay" on the label.
153. Recalling that the representative of Bulgaria had again highlighted the reputation of its
"yoghurt" and "feta", a reputation to which he also attested, the representative of Australia said that if
the demandeurs of the extension got what they wanted, there would still be no guarantee thatBulgaria, or any other country-name like Bulgaria, would be accepted as a geographical indication.
Actually, if Bulgaria acceded to the European Communities, it would not be permitted to use the term
"feta" in the products it exported to the European Communities. And, furthermore, if the demandeurs
succeeded, regardless of whether Bulgaria joined the EC, Australia would be forced to prohibit the
imports of Bulgarian "feta" because in the European Communities this would be a protected Greekterm and, therefore, it would be in the register. And because it would be in the register, AustraliaIP/C/M/37/Add.1
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would have no obligation to accept and protect it, unless it wanted to go into lengthy dispute
settlement procedures.
154. He recalled that Switzerland and Bulgaria had explained that an extended GI-regime would
only apply to new geographical indications. Did this mean, then, that something like "Ceylon tea" and
"Indian Basmati rice" would not be covered?  This was an important question because it seemed tohim that those developing countries that had supported the idea of extension had done so on the
assumption that a country name, and their commodity, would be accepted on this international register
that the demandeurs were seeking.
155. As to "traditional terms", he recalled the EC representative's statement according to which
"non-geographical names" were unquestionably not covered under the definition of a geographical
indication. If this was so, why, then, the European Communities in its official press-statement on the
"wine GIs", when it came to some "traditional expres sions", implied very clearly that this was indeed
covered by the TRIPS definition of geographical indications?  One, however, could not have it both
ways. One could not, on one hand, give assurance that anything it will do on "traditional expressions"
would not be done under the TRIPS Agreement, and, on the other, give an official press statement
saying that these same "traditional expressions", which were nothing more than normal English
adjectives, would be covered as geographical indicati ons. So, what would exactly be the status of, for
example, the European Communities' traditional specialty goods? How would they be linked to
particular countries? It was not clear, then, whether extension would necessarily have no implications
for Article 22.1 of the TRIPS Agreement, as the demandeurs claimed. That, he believed, was a
question all Members needed to decide. What was clear to him was that the way Article 22.1 would
be structured and interpreted would have significant implications for all Members, including thosewith particular ambitions in relation to particular products, and those that would have to implement
and enforce a wide variety of products on behalf of the other Members.
156. Concluding, he also recalled the EC representa tive's previous statement that just because
some countries provided in their domestic legislation for provisions, measures or concessions that
would go beyond what they were officially called upon to do under the WTO, so ipso facto  those
countries had to support extension in fora like the WTO. He did not think there was anything that
suggested this premise. There was no basis to thin k that just because a country did something in its
own national interest, that therefore it had to be prepared to come to the WTO and enter into a
commitment to an undertaking which would go far beyond what it had done nationally. Actually, the
key point under the TRIPS Agreement, when it came to geographical indications, was the principle of
"territorial application", in other words, each Member would decide whether a geographical indication
was a geographical indication or not. Under the proposal of the demandeurs, however, that rightwould be taken away and exchanged to a complic ated process of international registration, of
challenges, of disputes, and arbitration, which would be performed by people that would not be
officers of the governments of the Members. So, by its very definition, the additional protection that
the demandeurs were seeking for products other than wines and spirits would go well beyond the
current rights and obligations under Article 23.
157. The representative of Malta, commenting on opponent's arguments concerning the alleged
imbalance in numbers, said that regarding geogra phical indications, as well as other intellectual
property rights, numbers were not fundamental for the consideration of the economic and commercial
impact of geographical indications.  It was the quality of the geographical indications that mattered
and not the quantity.  Furthermore, he was of the view that Article 22 should remain intact, while hefully supported the proposed changes to Article 23.1, namely, to delete any mention of wines and
spirits both in the title and the text and to replace it by "all goods."  He noted that the rationale behind
these changes was explained in detail in document IP/C/W/353, which his delegation had co-
sponsored.IP/C/M/37/Add.1
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158. The representative of India reminded that his delegation's views were contained in
communication IP/C/W/353, which had been referred to by the representative of the Czech Republic.
India's proposal on extension had no implications on the definition in Article 22.1. Interested parties
should have the means to prevent the use of geographical indications without having to prove that the
public was misled or there was an act of unfair competition.
159. The issues raised in document IP/C/W/360 did not seem to reflect the legal position contained
in the TRIPS Agreement.  He did not understand the argument that a term like " Basmati rice " could
not be considered a geographical indication merely because it did not name the actual place of origin.
Where in Article 22 was it said that only geographical names could be geographical indications?  This
would amount to inventing a new definition of geographical indications. " Basmati rice " was
recognized in India as containing certain defined characteristics and coming from a certain region of
the country.  The legal system recognized it, though, at present it was not formally registered. But thiswas a temporary situation that did not prevent India from protecting this term as a geographical
indication. Similarly, there was nothing in Articl e 22.1 that would prevent recognition of geographical
indications coming from two countries.  He noted that the principle of territoriality, as applied to the
TRIPS Agreement, had been elaborated by the representative of the European Communities.
160. The representative of Argentina shared many of the points made by Australia.  He noted that
some delegations had made specific proposals to amend the TRIPS Agreement, and said that he was
not prepared to receive such proposals. His delegation had produced a communication two days
before the Doha Declaration appeared, and in particular, his delegation read paragraph 18 of the Doha
Declaration in a way that, at most, enabled th e Council to consider to address the question of
extension. In no way could the Council take the mandate to mean that it could re-open the TRIPSAgreement to extend protection to products other than wines and spirits.
161. Undoubtedly, this was an issue that had very complex and sophisticated ramifications. He
congratulated those delegations from developing countries that were in a position and prepared to
move forward in an intense and committed way, because it showed that they had gathered studies and
analysed these matters and that those analyses had shown that it was in their national interest to workon a model with these characteristics.  His delegation had not been able to do this and was not in a
position to evaluate all this, which was why it had taken the attitude it had.  The definition contained
in Article 22 applied to all geographical indications, including those mentioned in Article 23.
According to the definition, for geographical indications to be eligible for protection, the following
conditions had to be fulfilled: the existence of the product, the product had to have a given quality,
reputation and other qualities connected to its geographic origin and it should originate in the region,
etc.  Up to that moment, the coverage had been quite wide.  From there on, however, only the nationallegislation of each country could further elaborate the scope, the coverage and the nature of what was
covered by Article 22.1. This was the right of Members, according to the Agreement, which enabled
them to apply the system in their own legal framework according to their own legal system.
Intellectual property rights were private rights that were applied territorially and, hence, Members had
the option of deciding the degree of protection and the conditions applying them and their validity.
162. The representative of New Zealand said that, although her delegation welcomed the Checklist
to assist in structuring the discussion of the Council, it associated itself with Australia's statement
regarding the caveats of this document, in particular it was not an exhaustive list of issues and that the
discussion could not be divorced from trade policy and development concerns.  She noted the
Chairman's and others' wish to avoid duplication with other agenda items and fora, with which herdelegation had no quarrel.  She noted, however, that under this agenda item the Council's report-back
requirement stemmed from paragraph 12 of the Doha Declaration, which provided the context for a
part of the Council's work, i.e. the evaluation of current implementation of TRIPS in this area,
including any problems, and the consequent trade and development prospects of Members. Because of
this element in the Council's mandate on extension, the Council had to give due attention to theseissues.  Therefore, while she appreciated that the agenda item on Article 24.2 implementation reviewIP/C/M/37/Add.1
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of the geographical indication provisions was a separate agenda item, the theme of implementation
was very relevant to both agenda items.
163. Turning to the issue of definition, she noted that from her delegation's own practical
experience, there could be a difference between what many countries understood as being or not being
covered by the Article 22 definition and, in practice, of what protection was actually provided. Thiswas the reason her delegation had supported a discussion on this issue, since it had hoped that
expectations of possible benefits were in fact realistic. This was why a discussion of the definition
was relevant, contrary to what the Council had heard from some delegations. She noted from the
minutes of the Council's last meeting, that India, when introducing a paper on behalf of a number of
delegations, had noted that under that proposal, producers of Chinese tea, French ceramics and
Turkish carpets would have, under extension, an effective instrument of protection. That comment
interested her delegation considerably because that had not been its experience with respect toextended protection for wine. The delegation had been  told that, for example, the term "New Zealand
Chardonnay" could not receive protection under the European Communities' system because it
represented a geographical area that was too big to satisfy the second part of the Article 22 definition,
i.e. that a "given quality, reputation or other characteristic of the good was essentially attributable to
its geographical origin". She, then, wondered whether anyone had looked on the map recently andcompared the landmass of New Zealand to, for example, China, Turkey or France? If New Zealand
was too large to meet the European Communities' test of distinctiveness, then how were other
countries supposed to? Or was New Zealand missing something else? Was there possibly some idea
that production methods used for wine could be distinguished against, for example, the production
methods to grow tea, and could hence provide some sort of basis for a discriminatory approach towhether a country GI would be recognized?
164. She understood that concerns had been expressed by demandeurs that the test of misleading
the consumer under the current Article 22 level of protection was subjective and that it lent itself to
too great a variation across nations. As she had pointed out earlier, this was perhaps a concept to be
thought about with respect to the Article 22 definition:  Were the subjective criteria that seemed to beused by some countries in determining whether some geographical indications met the definition such
that some would advocate the need for rectification to the Article 22 definition?  The key difference
between Article 22 and 23 levels protection was that Article 23 provided for absolute protection to
one right-holder.  This absolute right of protection was far greater than the level of protection applied
to other intellectual property instruments in the TRIPS Agreement.  On the other hand, Article 22
level protection explicitly provided for the objectives of preventing unfair competition, while
maintaining a balance of interests between different producers and between consumers and producers.Article 22 allowed for these objectives to be met through the use of a "misleading consumers test".
This was a well respected and durable test, used historically in a large number of legal systems and
also in a large number of legal contexts.  Article 23, on the other hand, made no accommodation for
this important principle.  She hoped that those who had raised the issue of the imbalance of numbers
would understand that her delegation was indeed concerned about the costs that would arise from theimbalance in numbers.  However, at the end of the day, for her delegation, it was the nature of
protection that was the crucial issue in looking at the economic values and disadvantages that flowed
from possible extension.  Article 22 was, therefore,  more consistent with the objectives of the TRIPS
Agreement, as seen under Article 7, which stated that the protection and enforcement of intellectual
property rights should be done in a way that was conducive to social and economic welfare and to abalance of rights and obligations.  Similarly, Article 8 of TRIPS noted the undesirability of
intellectual property rights being used to unreasonably restrain trade.
165. The exceptions in Article 24 could provide some relief for marketing transition under a
possible extension scenario. But she also believed that a disproportionate amount of faith was put in
these exceptions as a means to facilitate a smooth transition in the market to a higher level ofprotection. She was not sure how much faith could be placed on these exceptions, especially when it
had been obliquely said by the demandeurs in their proposal, presented at the last meeting, thatIP/C/M/37/Add.1
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Article 24.6, the crucial exception on generics, would ne ed to be adjusted.  Article 23 level protection
and the associated deletion of consumer deception and anti-competitive behaviour tests, severely
reduced the ability of producers from outside the geographical area to use the courts to objectively test
whether terms were eligible for protection or had in fact become generic.  This did diminish
producers' ability to avail themselves of the Article 24.6 exception.  For this reason, she did notnecessarily see that some of the exceptions in their current state would be enough to avoid serious
trade disruption under a possible extension scenario.
166. In closing, she responded to two of the points made by the European Communities.  At one
stage in his intervention, the representative of the European Communities had noted the existence of a
low level of foreign registrations in some countries, which had already implemented an Article 23
level of protection.  Her delegation believed that the fact mentioned by the European Communities, in
reality, had the effect of emphasizing the argument according to which there was no problem withArticle 22 and that producers currently felt they already had sufficient protection.  The European
Communities had also noted that some countries already provided for Article 23 level extension
despite the fact that they were opposing this development in the Council.  She stated that in her
delegation's general experience there was nothing like national experience to fully understand the true
evils of something.
167. The representative of Pakistan noted that one argument in communication IP/C/W/360 was
that the protection of geographical indications under Article 22 was sufficient and that its mechanism
had simply not being used. He recalled that the delegations in favour of extension, including his own
delegation, had already set out in detail in paragraphs 9 to 14 of their communication (document
IP/C/W/247/Rev.1) why the protection granted by Article 22 was insufficient in comparison to theone offered by Article 23.  In the same document, the delegations critical of extension perceived the
fact that producers entitled to use the geographical indication "Swiss" for chocolate had taken steps
under Article 22 to fight misuse of this geographical indication, as evidence that the protection
granted by this provision was sufficient.  However, this was so only because Article 22 was the only
protection available to be used, even if an in adequate one. Similarly, "American Limoges" for
porcelain dinnerware, also used in communicati on IP/C/W/360 as an example to demonstrate that
Article 22 level protection was sufficient, was only because it had passed the "misleading test".
However, with extension, no such cumbersome and legally uncertain test would have been necessary.
The term Limoges being an indication for French quality porcelain, could, under the more effective
level of protection of Article 23, not have been used in American porcelain.  In comparison to
Article 23, the protection under Article 22 was based on subjective criteria, i.e. the expectations of the
public in a specific market of a particular product and the geographical indication and the knowledgeof that geographical indication.  On the other hand, Article 24 level protection, which based protection
on one simple objective criterion, namely on whether the product actually originated from the place
indicated by that particular geographical indication.  Small producers and associations would simply
not have the necessary means to prevent the abusive use of their geographical indications in a foreign
country if the protection of their indications continued to be subject to the difficult and burdensomeproof that the public had been misled, or that there was an act of unfair competition. Offering them,
instead, the less-costly and legally-secure protection of Article 23 for their geographical indications
would not only encourage them to prevent abusive use of their indications, but would also avoid the
investment they had made in the development and marketing of their products to be in peril.
168. The representative of Sri Lanka associated herself with the statements made by Switzerland,
India and all the proponents of the extension.  She discussed the confusion there appeared to be
between geographical indications and terms such as indications of source and appellation of origin.
As requested by the delegation of Sri Lanka, its full written statement is reproduced in the Annex to
these minutes.
169. The representative of the Czech Republic said that her delegation and the other proponents of
extension had clearly stated several times that the proposal for extension was designed to have effectsIP/C/M/37/Add.1
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only for the future and would not affect existing uses of names that coincided with protected
geographical indications to the extent that they had been in conformity with the TRIPS Agreement,
along the lines of what was provided in Article 24.  She was pleased to note that this view was shared
in paragraph 10 of document IP/C/W/360.  However, it seemed that the arguments of paragraph 10 of
the that document, regarding generic terms and customary usage, had been used only to convinceMembers of the usefulness of extension, because generic terms fell under the Article 24 exceptions.
These arguments were not at all in line with paragraph 25 of the same document, which underlined
the fears of producers of losing some generic or customary terms.
170. Commenting on the term "pilsner", which was used as an example in paragraph 25 of
document IP/C/W/360, she reiterated that the extens ion would only have effects for the future and
would not in any case revoke the status quo  in using this geographical indication originally coming
from Bohemia. The Czech Republic had never associated the extension of geographical indications
with the term "pilsner", but only with Czech beer as an example of a kind of product.  The
Czech Republic did not make any attempt in the WTO to protect the term " pilsner"  world-wide.
There was no reason to be afraid of losing the te rm "pilsner", which had been used as a generic
term or as a beer type indication.  For example,  in one EC member State various modifications of
the term "pilsner" had been used since the 19th century and 60% of the total beer consumption had
been sold under one of "pilsner" denominations, and producers of this country were not at all
concerned about losing this terms due to exte nsion.  The fact that the European Communities
belonged to the group of demandeurs proved this point.  She also raised another argument directed
to Members who had not yet come to a clear decision on favouring the extension because of extensive
use of the term "pilsner" in their country.  The brewery from the town Pilsen in the Czech Republic
had recently started to license the production of Pilsner Urquell abroad.  If the Czech Republic had
had any interest to protect the geographical indication "pilsner" under the extended Article 23, thelicensed production of Pilsner Urquell would have never occurred.
171. Although the Czech Republic had no interest to protect the term pilsner as a geographical
indication under the extended Article 23, the pilsner story could illustrate very well the negative
impact of sufficient protection of geographical indications.  The pilsner beer was for the first time
produced in the town Pilsen in 1842 and it was exported abroad under the name Pilsner Bier inGerman language. German was at that time an official language in the territory of Bohemia. The beer,
which was based on a new production method (bottom fermentation), became quite popular and
famous due to its quality, taste characteristics, hop flavour and golden colour.  The beer's fame
became fatal for its name.  Other breweries world-wide started to produce beer using the same
technology.  It became customary in most countries to sell beer of this particular type with the
denomination "pilsner" or modifications of it. In the terminology, which had being used today, it
could be said that foreign breweries free-rode on the reputation and goodwill of the Pilsner beer. Theinfringement was so extensive at that time and the term "pilsner" was used with such frequency, that it
was, despite many attempts, impossible for the legitimate owner of the geographical indication to
prevent counterfeiting and the use of the term in a generic sense.  Inefficiency, in the "pilsner"
example, was consequence of several reasons. One of the most important reasons was the lack of
effective legislation on the protection of geographical indications, both at the multilateral and nationallevels.  There was little practice regarding procedures of staving off illegal use of product
denominations and regarding procedures against steps leading to the situation where terms became
generic.  The situation was further complicated by the distance of some territories where the term was
used where the producer was not present.  It was now a historical fact that the denomination "pilsner"
was considered in most of countries, and among consumers, as referring to a particular type of beerindependent of the country or place of origin.  The original Pilsen brewery lost markets in these
counties and its export was seriously damaged.  Assessment of this type of losses could be easily
expressed in numbers.  
Concluding, she said that nowadays there existed the opportunity to
prevent such disasters for all geographical indica tions, which were for th eir owners and countriesIP/C/M/37/Add.1
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valuable property and heritage and which still ha d not become generic terms.  The Council should
seize this chance for the benefit of all WTO Members.
172. The representative of Chinese Taipei said that, although GI extension was one of the major
concerns for his Government, it had provided high level of protection to geographical indications for
wines and spirits, as required by Article 23 of the TRIPS Agreement.  The Agreement did not intend
to oblige Members to provide extended protection to products other than wines and spirits.  To do so,would impose an additional burden on Members who did not have a balanced interest on extension.
In this regard, he recalled that balance of interests was one of the fundamental principles in the WTO.
He associated his delegation with the view, previ ously advocated by Canada, Korea and many others,
according to which Article 22 already provided adequate protection of geographical indications.  The
current intellectual property rights system, such as collective marks and certification marks, needed
only minor tuning in order to cover the protection of geographical indications for goods other than
wines and spirits.  There was, therefore, no need to establish a whole new system that would be costlyand burdensome, as it would be the case if extension would take place. Concluding, he expressed his
support of document IP/C/W/360.
173. The representative of Switzerland said that Article 22 of the TRIPS Agreement offered a
basic level of protection for geographical indications identifying any types of products.  Article 23, for
its part, offered an additional protection, which, however, was limited to geographical indicationsidentifying wines and spirits, when they were used on wines and spirits respectively, in other words,
when they were used within the same product category.  For the purpose of illustration, he gave the
example of the term "Bordeaux", identifying a famous French wine, and that could only benefit from
the protection under Article 23 if it was misused on a wine not originating from France.  But if the GI
"Bordeaux" was used on, e.g. biscuits, or on clothes produced outside of France, i.e. it was used toidentify a product outside the same product category, then the protection of Article 22 would apply,
since these non-wine products were not the goods th at the GI "Bordeaux" would normally identify.
Therefore, the key difference was that while Article 22 limited protection to cases where the use of a
GI misled the public as to the true geographical origin of the product, or where such use constituted an
act of unfair competition, Article 23 provided protection for geographical indications for wines andspirits if the respective GI was used on wine or on spirit products. In the latter case, one would not be
required to prove either that the public was misled or that it was a case of unfair competition. Also,
Article 23 protection differed from the one in Article 22 in that it prohibited the misuse of
geographical indications with accompanying expressi ons such as "style", "type", "kind", "imitation".
Lastly, and differently from Article 22, Article 23 did provided protection in cases where ageographical indication was used in a translated form. In short, Article 22 made protection dependent
on two criteria, which shifted a difficult burden of proof on the legitimate users of a geographical
indication who wanted to prevent abuse. Furthermore, the misleading test introduced a subjective
element, which, again, rendered protection more complicated and legally insecure.
174. Exceptions in Article 24 applied to both Article 22 and 23 level of protection and, therefore,
would also apply under extension.  The exceptio ns of Article 24 took into due account Members'
national regulations and practices before the entry into force of the TRIPS Agreement and the need tobalance the interests of the various parties interested in the use and protection of geographical
indications.  The delegations in favour of extension did not want to shift this balance.
175. Concluding, he said that he could still had gone on speaking about many other matters related
to the discussion of the Council but because the time was short we would have to refrain from doing
so. He added, however, that a solution for this lack of time needed to be found so Members would beable to accomplish the work that laid before them , particularly the legal issues, to which the other
remaining issues were dependent on. One possibility, he suggested, would be scheduling an inter-
sessional meeting of the Council before the November regular meeting.IP/C/M/37/Add.1
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176. The representative of Malta said that he fully supported the proposal by the Swiss delegation
to have an additional meeting of the TRIPS Council  dedicated to the issue of extension before the
November meeting.  This would enable the discussion to be reflected in the Council's report to the
TNC, which the Members would adopt in the November meeting.  He believed that no procedural
impediments existed for such a meeting to be organized.
177. The representative of the United States thanked Guatemala for introducing communication
IP/C/W/360, which his delegation was pleased to co-sponsor with a number of other WTO Members,
both developed and developing.  The concepts in that paper continued to get wide and increasing
support.  He associated himself with a number of comments made by Canada, New Zealand and other
co-sponsors of the paper.
178. Turing to legal matters, he said that the United States had taken note of the fact that some
Members who were among the demandeurs on this i ssue did not make protection available to the
nationals of other WTO Members on the basis of national treatment. It was then interesting to hear
earlier in the present meeting one Member providing the Council with its own definition of national
treatment under the TRIPS Agreement in the area of geographical indications. It was thus pertinent to
question whether all Members had fully appreciated just exactly what the definition that this Member
had offered really meant for the discussion the Council was having. This was an important inquirybecause when exploring the real meaning of such a definition one would find it to be much more
fundamental to the issue of whether or not any benefits would flow from extension, than to the issues
of whether a country name could be considered a geographical indication or some of the other issues
the Council had discussed.  The European Communities' definition, at least as he understood it, said
that under TRIPS, national treatment would be available to nationals of other WTO Members, but notto products. What that meant was that a WTO Member would have the opportunity in the European
Communities to obtain protection if it wanted to register an European geographical indication.
However, he did not think that too many Members would be expecting to build a business on the
registration of European geographical indications.  In fact, he had always thought that what each
Member had negotiated for under the TRIPS Agreement was the protection for their owngeographical indications.  He therefore found this interpretation to be quite shocking.  He believed
that the right interpretation would be the one which would incorporate the idea that all Members
expected that their own geographical indications would be protectable on a national treatment basis in
the territories of other WTO Members.  And if that was not the case, he certainly would not be able to
imagine why anyone would have any interest in engaging in extension of the protection provided
under the TRIPS Agreement.
179. The representative of Brazil, reacting to the Eu ropean Communities' reference to his country's
legislation, said that had the European Communities taken notice of his delegation's intervention
during the Council's previous meeting and of the presentation of the Brazilian laws during the review
of its IP legislation, it would not have been necessary for the European Communities to obtain the
same information through an inquiry to the Brazilian national IP authorities. Provisions in its laws that
implied anything beyond the TRIPS Agreement should not be construed as an agreement onTRIPS-plus proposal in the Council.  In this regard, he was in full agreement with the arguments
provided by Australia and Argentina.  Another important point raised by the European Communities,
related to the balance.  The European Communities had noted that, so far, Brazil only had one
geographical indication protected, called " Cachaça ", while the European Communities had a couple
of registrations and applications for geographical indications.  This, in his view, in no waydemonstrated this was a "balanced" situation. He be lieved that a better way to approach the issue of
whether there existed balance among Members would be to analyse the number of geographical
indications currently protected in their own c ountry.  While noting that the current number of
Brazilian geographical indications protected in Brazil was exactly one, he wished to know how many
geographical indications the European Communities protected in their member States, so then hewould have a better idea of balance in terms of the potential interest in expanding protection of
geographical indications.  Balance, he continued, also related to the level of experience amongIP/C/M/37/Add.1
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Members in protecting their geographical indications. In the case of Brazil, the one geographical
indication it had protected so far had been registered only in December 2001.  There was no question
that the great number of geographical indications protected within the EC member States and in any
other countries that had more experience had enjoyed a longer time of protection. Therefore, Brazil
certainly believed that it would be important to take into account the experience that countries had inthis area.
180. As to Hungary's reference to his delegation's suggestion to base the Council's discussions on
empirical evidence, he believed that it should not be difficult to bring some examples from national
experiences that could, actually, be beneficial to the proponents of extension.  In this sense, he was
somewhat surprised when he saw the reaction of one of the proponents to the provision of factual
evidence on the benefits of extension.  Hungary had also mentioned the relationship between patents
and geographical indications and, if he had understood it correctly, the argument was that there wasno empirical study on the benefits from the patent protection for pharmaceutical products.  If that was
the case, when Brazil introduced the element of en gaging in a factual evidence-based exercise, this
was precisely the kind of imbalance it was seeking to avoid in reproducing imbalances already
incorporated in the area of patent protection.  So, Brazil now believed that TRIPS had been criticized
in large part due to the lack of evidence of potential benefits that all Members could enjoy fromincorporating either patent or geographical indication protection.  Therefore, Brazil was precisely
trying to avoid this type of uninformed decision and his delegation did not think that there should be
any problems in bringing factual evidence to the Council's discussions.
181. The representative of the European Communities said that the Council should concentrate on
questions directly concerned with the substance of the issues pertaining to its mandate and not on
other matters that had nothing to do with it.  He agreed with those delegations which had suggested an
extra meeting to be held before the next formal meeting of the Council.
182. The representative of Paraguay said that perhaps the representative of the European
Communities should hold itself to substantive issues and not refer to the legislation of other countries,
which had nothing to do with the subject-matter at hand.  Article 1 of the TRIPS Agreement providedthat Members' legislation could offer greater protection than that stipulated in the Agreement.  This
did not mean that Members were obliged to agree internationally to a greater protection than provided
in the Agreement, nor that they had agreed to extend the obligations they had through it.  He agreed
with the representative of Argentina that there was no mandate to negotiate. What existed was a signal
from the Doha Ministerial Conference to the Council to discuss, and, at the end of 2002, the Chair of
the Council should inform the TNC of the topics discussed and the conclusions reached.
183. The nature of intellectual property rights was based on the protection of knowledge.  This,
within the negotiations in other frameworks, such as in WIPO, had led to the protection not only of
knowledge but also to the attribution of geographical location to the place where the people applying
that knowledge to the production of a good were found.  That was the reason why extra protection
was offered - the protection by geographic indications.  This did not mean that they should continue in
that forum under-mining the basic concepts and nature of IP protection.  As another Member hadmentioned, in the end they would be bestowing protection upon the product before knowledge; that
was not what intellectual property protection was about.  His delegation, which was a co-sponsor of
document IP/C/W/360, believed that the extension of the additional protection under Article 23 to
other products was not a valid choice.  The capacity to legislate and to apply law was a prerogative of
the state and there was a territorial framework within which a country could apply these laws andregulations.  His delegation found that some countries tried to extra-territorialize their laws and
regulations.  Paraguay applied its laws and regulations, and the international agreements it had signed
and ratified, within its borders.  Thanks to the fact that Paraguay faithfully applied what it had signed,
his country did not yet have any cases of dispute resolution.IP/C/M/37/Add.1
Page 43
184. The representative of Mexico found the Checklist to be a creative and useful way to give a
new dynamic to a discussion that, frankly, was going in circles. Mexico generally supported document
IP/C/W/360, presented by Guatemala and other countries. His delegation believed it was useful and
illustrative of the discussion the Council was having. In his view, the imbalance in geographical
indications between Members was very marked, whether by value, volume or prestige.  His delegationfound it hard to identify the need to modify the TRIPS Agreement to extend the protection of
Article 23 and the potential benefits flowing from extension, because, among other reasons, general
protection was offered by Article 22.
185. The representative of Bulgaria, responding to the delegations that had said that presenting
proposals for extension was "ambitious" or "extremely ambitious", said that if the Council did not get
a substantive solution to this issue, as mandated by paragraph 12 of the Doha Declaration, it would
not have fulfilled its mandate, and this would have an impact on Bulgaria's position on other things.His delegation thought that other proposals in other areas were extremely ambitious, so there should
be no mistake of its positions in other areas of these negotiations.
186. The representative of Tunisia supported the suggestion to organize an additional meeting with
a view to achieving a mutually acceptable solution which would enable the Council to correct the
imbalance which currently existed regarding the protection of geographical indications.
187. The representative of Argentina said that paragraph 12 of the Doha Declaration was a
paragraph about the fulfilment of commitments made.  As long as no commitments had been made,
there could be no fulfilment. Therefore, in no document emerging from Doha was there a commitment
to negotiate an extension of the subject-matter at hand.
188. The Chairman thanked Members for allowing the Council to have a very rich discussion on
the topic, which was sufficiently complex to require much more time.  He knew that some delegations
would have liked to speak again, while others, which would have liked to, had not yet spoken.  He
appreciated their understanding and proposed that the Council have another informal meeting open to
all delegations.  The main goal of the meeting would be to finish the discussion of the first legal
section and begin the discussion of sections two and three.  He also asked the Secretariat to help theCouncil by making a thematic compilation regarding the first section based on what the Council had
discussed in the present meeting, so that all Members could have factual information of the
discussions in the present meeting on the first topic.  The objective would be to have at the Council's
disposal a document where all the information relatin g to the discussions at the present meeting would
be available organized in a thematic manner and would compile the positions of the delegations
during the present discussion on legal matters.
189. The representative of Morocco was in favour of holding another meeting and supported the
preparation of a compilation of issues.  Such a document should incorporate not only the oral
interventions but also all the papers and communications that had been produced regarding these
issues, particularly the legal ones. It would also be important to do the same with the other two
remaining issues in the Checklist.
190. The representative of Canada said that it was very clear from the present discussion that the
Council obviously had more work to do.  She thought that the one common theme that they had heard
throughout the day was how important the work in  other fora was to the whole process.  She
wondered if it might not be good to perhaps postpone the meeting after the meeting of the WIPO
Standing Committee on Trademarks, if the Council decided to have it, until after that work was
completed, which could factor into the discussion.
191. The representative of Argentina said that the Council could wait before taking a decision,
particularly in regards to a specific date, until the end of the session.  The representative of
Switzerland said that it was important that to fix the date, and supported Morocco's suggestion thatIP/C/M/37/Add.1
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written communications should also be taken into consideration in the thematic compilation.  The
representative of the United States requested some time to consider the proposal. The representative
of the Czech Republic said that he appreciated both proposals and supported the suggestion of
Morocco to incorporate in the summary also the written proposals from both sides.
192. The representative of Sri Lanka said that she was in favour of requesting the Secretariat to
prepare a compilation.  If the Council did not take into account the previous submissions and the oral
interventions made, the document might not reflect the correct picture of the issues discussed.
Therefore, she asked that when the Secretariat compiled the document it reflect both oral and written
submissions.
193. Following consultations on the matter, the Chairman proposed that the Council hold an
informal meeting on Sunday 10 November to continue this discussion. He also proposed that the
Secretariat be requested to prepare prior to the Council's next formal meeting a compilation of theelements contained in the oral statements made at the present meeting and the written submissions
prepared for it, including the points made at the fo rthcoming informal meeting, in relation to the first
"basket of issues".
194. The Council so agreed.
E. REVIEW OF THE PROVISIONS OF ARTICLE 27.3(B)
195. The Chairman informed the Council that, as had been agreed during the June 2002 meeting,
the Secretariat had now circulated the information contained in informal notes, JOB(02)59, 58 and 60
on  the review of the provisions of Article 27.3(b), the relationship between the TRIPS Agreement
and the Convention on Biological Diversity (CBD) and the protection of traditional knowledge and
folklore, as working documents IP/C/W/369, IPC/W/368 and IPC/W/370, respectively.  He recalledthe Council's invitation to WIPO, UNCTAD, FAO, the World Bank, CGIAR, CBD, UNEP and
UPOV, to provide updated information on their activities with respect to agenda items E, F and G.
Since its meeting in June, the Council had received information from the World Bank (subsequently
circulated in document IP/C/W/347/Add.4), in addi tion to the information from the FAO, the CBD,
UNCTAD and UPOV that had been received already prior to the June meeting (documentsIP/C/W/347 and addenda 1-3, respectively).  Furthermore,  he recalled  that Members were  urged at the
March 2002 meeting to provide responses to the questionnaire on the implementation of Article
27.3(b) by June 2002.  The Secretariat was also requested to update document IP/C/W/273 on the
basis of any responses received from Members.  To this effect the Secretariat had issued a reminder
on 26 March 2002, as contained in airgram WTO/AIR/1756, to provide this information.  Since then,
the Secretariat had received additional responses fr om Estonia;  Hong Kong, China;  Lithuania and
Thailand as contained in documents IP/C/W/125/Add.20, 22, 23 and 21, respectively, and asupplement from the Czech Republic, issued in IP C/W/125/Add.8/Suppl.1.  The Secretariat would
update the synoptic table in its summary note as requested by the Council in light of these new
submissions.  Further, the Chair informed the Council of the communication that had just been
received from the EC and their member States on  the review of Article 27.3(b), the relation between
the TRIPS Agreement and the CBD, and the protection of traditional knowledge and folklore(subsequently circulated in document IP/C/W/383).
196. The representative of the European Communities said that IP/C/W/383 dealt with the three
agenda items viz.  E, F and G in one communication and that, in preparing the document, the EC had
reviewed the minutes of the meeting of the TRIPS C ouncil and the documents tabled over the last few
years.  The EC believed that with this communication, they would contribute positively andconstructively to the mandate laid down in paragraph 19 of the Doha Declaration, which instructed
the TRIPS Council to continue the review of Arti cle 27.3(b) and to examine the relationship between
the TRIPS Agreement and the CBD, the protection of  traditional knowledge and folklore and other
relevant new developments.  He believed that a flexible and non-dogmatic position by all Members ofIP/C/M/37/Add.1
Page 45
the TRIPS Council and a genuine willingness to look at reasonable measures would allow the Council
to take a fresh look at all these issues in a relatively short period of time.  He said he was convinced
that solutions could be found which genuinely reflected the concerns of developing countries, while
not affecting the substance nor the balance of rights and obligations laid down in the TRIPS
Agreement.  It was important for Members to create a favourable intellectual property environmentfor research in the area of biotechnology.
197. The representative of Zimbabwe recalled his delegation's intervention at the last formal
meeting of the TRIPS Council in June 2002 and reiterated that he saw a lot of common ground in the
discussion of this issue and believed that it was possible for the TRIPS Council to adopt a decision
reflecting areas of agreement, so that Members could turn their focus to those other areas where no
agreement existed.  One of the areas of disagreement appeared to be the very need for definitions to
give precise meaning to certain terms in Article 27.3(b), such as microorganisms, non-biologicalprocesses and essentially biological processes for the production of plants and animals.  The EC, in its
concept paper on this issue, had devoted nine or ten paragraphs to give reasons why they did not think
that engaging in the exercise of definitions was a good idea.  Some of the reasons given against
seeking a common understanding of these terms included the fact that there were difficulties getting
all WTO Members to agree on definitions; that WIPO rather than the TRIPS Council was the rightforum to agree on definitions of technical issues, and that definitions could compromise Members'
flexibility in the use and interpretation of the terms that the Council sought to define.  The difficulty
of getting all WTO Members to agree on definitions should not, in his view, deter the Council from
embarking on the exercise of coming up with precise definitions of certain terms.  He said that he was
aware of the fact that the WTO Members appeared to have difficulties agreeing on a number of issues,not just on definitions, but this fact had not deterred the WTO membership from tackling difficult
issues in the past and should not deter them now.
198. He continued that, in an apparent recognition of the importance of giving specific meaning to
the terms in Article 27.3(b), the EC had noted in paragraph 21 of their paper in relation to
microorganisms that the definition of the scope of microorganisms was important at the domesticlevel as these were widely used in the pharmaceutical, chemical or biotechnology industries and as
these were the only form of living organisms for which WTO Members were obliged to provide
patent protection.  Zimbabwe was not convinced that while it was necessary at the national level to
give precise meaning to the term 'microorganism', it was not necessary to do so at the international
level.
199. Zimbabwe was also not convinced that WIPO was the right forum to agree on definitions of
technical terms simply because, as the EC stated, WIPO had more expertise on this specific technicalissue.  His delegation saw no reason why, if inde ed that was the case, the TRIPS Council could not
enlist the services of these same experts to help it arrive at specific definitions.  He wondered why the
EC appeared to think that it would be any easier to agree on the definitions at WIPO when the same
WTO membership was more or less replicated in WIPO.  There was no intention on the part of those
Members, including Zimbabwe, who were advocating precise definitions, to diminish or erode anyflexibilities that Members felt they had in respect of  the meanings that they currently attributed to any
of those terms, a fear raised by the EC in their pa per.  He believed that specific meanings could be
arrived at while preserving reasonable flexibilities and that defining the terms in Article 27.3(b) was
necessary and could be done if all the Members put their minds to this task.
200. The representative of the European Communities emphasized that his delegation had tried to
look at all the issues which had been addressed over the last few years in a comprehensive manner.  In
his view, some degree of realism was necessary if Members wanted to make progress on some of the
issues in a reasonable time perspective.  In his view, Members should be selective in deciding the
issues on which to concentrate in the TRIPS Council.  In light of the experience of work undertaken in
the WIPO in many areas, he believed that the WIPO  was the best forum to undertake an exercise on
the question of definitions of highly technical terms and was therefore not convinced that the TRIPSIP/C/M/37/Add.1
Page 46
Council could usefully embark on this exercise.  He believed that all Members had some interest in
retaining their flexibility in this and other areas of  the TRIPS Agreement.  It was clearly within the
jurisdiction of countries that patentability needed to  be examined and that definitions to which the EC
had referred to needed to be put into practice.  This should be borne in mind when Members reflected
on what sort of follow up they wanted on to this particular issue.
201. The representative of China said that her delegation understood that Article 27.3(b) of the
TRIPS Agreement preserved the rights of Members to decide whether or not to exclude plants and
animals from patentability in the light of their sp ecific national interests and needs.  According to
Article 27.3(b), plants and animals other than microorganisms and essentially biological processes for
the production of plants or animals, other than non-biological and microbiological processes, may be
excluded from patentability.  However, since ther e was no definition of the terms 'microorganism',
'non-biological' or 'microbiological processes' either  in the TRIPS Agreement or in other international
fora, it was difficult for Members to achieve further consensus with respect to the protection of
biotechnology-related inventions.  Moreover, with the rapid development of the biotechnology
industry, there had been much debate with respect to the patentability of, or the grounds for the grant
of patents to, genes of animals, plants, human beings or genetic materials in general, or the grounds
for the grant of patents to species of transgenetic plants or animals.  Special concerns had beenexpressed about whether granting patents to such inventions ran counter to the public order or
morality.  China considered biological material to be chemicals and granted patents to
microorganisms and genes so long as these inventions met the requirement for patentability as
provided for in the Chinese patent law and so long as their commercial exploitation did not go against
public order and morality.  In conclusion, as the review of Article 27.3(b) was mandated  in theTRIPS Agreement, her delegation looked forward to further cooperation in the TRIPS Council to push
forward the consultation and debate in this particular field, taking into consideration the relevant
provisions of the CBD and the protection of traditional knowledge and folklore.  China would do her
part to contribute to the efforts in the TRIPS Council aimed at providing effective protection for
inventions in the field of plants and animal va rieties and for biotechnology-related inventions in
general.
202. The representative of Malaysia believed that there was no inherent conflict between the
provisions of the TRIPS Agreement and CBD. TRIPS was an agreement that promoted the protection
of intellectual property rights, while the CBD recognized that owners of genetic resources should also
benefit from the use of these resources.  If at all there was any conflict, it arose because of the fact that
most of genetic resources resided in the developing world, while the technologies to develop these
resources were not within its domain.  TRIPS could provide a bridge to this divide by providing amultilateral means to enable rights holders of geneti c resources to have recourse to benefit sharing.
However, the TRIPS Agreement could itself be used to promote technological innovation and the
transfer and dissemination of technology.  Joint cooperation between the holders of technology and
owners of genetic resources should be stepped up to jointly develop new products, so that the benefits
of ownership of genetic resources went beyond mere benefit sharing.  Similarly, the protection oftraditional knowledge and folklore also encouraged the utilisation of genetic resources and this should
also bring benefits to their owners.  Some Members had developed their own models of protection
while others were in the process of doing so, as was seen from the experiences of Australia, India and
Peru that had been shared in the Council.   Malaysia welcomed more ideas on how Members'
legislation dealt  with these issues on a national level, as this would help in future deliberations in theCouncil.  The Council may take some time to reach a consensus on how to proceed on issues of 27.3
(b), relationship with CBD and traditional knowledge and folklore but, in the interim, WTO Members
should continue discussions on improving the understanding of Members on the developmental
linkages between TRIPS Agreement and the protection of genetic resources, definitions, and
patentability criteria and instruments that could be used to promote technological innovation, transferof technology and other developments that could contribute to the protection of genetic resources,
traditional knowledge and folklore.IP/C/M/37/Add.1
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203. The representative of Egypt said that his delegation agreed that there seemed to be no conflict
between the two Agreements from a legal point of view but, on a preliminary basis, he said that
intellectual property rights were related to, and had implications for, the implementation of the CBD
objectives.  The CBD asserted the sovereign rights of nations over their national resources, and the
right to determine access to these resources, with th e aim of facilitating their sustainable use, on the
basis of prior informed consent and mutually agreed terms that provided for fair and equitable sharing
of benefits.  Conserving biodiversity and achieving these objectives of the CBD were not completely
possible under a regime of private monopoly rights th at resulted from TRIPS because private property
regimes would undermine the access and benefit sharing provisions of the CBD.  These points of
inconsistency should be addressed in order that the signatory countries could meet the requirements
for complying with both agreements as had been reco gnized in the Doha Declaration.  To achieve this
consistency there should be a focus on how intellec tual property rules might need to be modified in
order to provide support for access to genetic resources and to allow for benefit sharing.
204. He recalled that during the last TRIPS Council meeting, a group of developing countries had
submitted a communication in which they required the pa tent applicant to disclose the origin of the
genetic resources and to provide evidence of prior informed consent.  His delegation believed that this
requirement would increase transparency and would help in ensuring the effectiveness of any benefitsharing provisions.  He said that these benefits could take various forms, including the transfer of
technology.  In this regard, the CBD addressed the importance of intellectual property rights for
developed countries and called for satisfying the demands of  developing countries  to facilitate access
to technology.  This could be realised by continuing scientific research based on genetic resources,
with the full  participation of the countries supp lying their genetic material and, at the same time,
ensuring access to technologies on fair and favourable terms.  The increasing role of biotechnology in
development, and its contribution to better health, food security and other areas, provided an
opportunity for coordination between those countries rich in biological resources but lacking the
technology, on the one hand, and those that had the technology to use these resources, on the other
hand, in order to serve the needs of sustainable development.
205. The representative of Brazil recalled the document circulated by a group of developing
countries on the relationship between the TRIPS Agreement and the CBD and elaborated on the
proposal made to amend the TRIPS Agreement in order to incorporate requirements for disclosure of
the source of the genetic material used in the invention.  He said that this was going to be one of the
priority issues for the TRIPS Council to  includ e in the Chairman's report to the Trade Negotiations
Committee and urged that the necessary procedures be initiated in order to prepare this report.  He
recalled that the recent World Summit on Sustainable Development (WSSD) at Johannesburg hadissued an implementation plan, paragraph 42 of which clearly stated that commitments should be
made to implement benefit sharing with the prior consent and participation of the communities that
held traditional knowledge.  The plan foresaw negotiations, within the CBD, of an international
regime to promote and protect fair and equitable benefit sharing arising from the use of genetic
resources.  Brazil believed that it was all the mo re important for the TRIPS Council to incorporate the
elements suggested by developing countries into  the TRIPS Agreement as otherwise any progress
within the CBD in terms of benefit sharing might be harmed by potential conflicts that might arise
from its relationship with the TRIPS Agreement.  He  agreed with many other delegations, including
Egypt, that, in principle, the TRIPS Agreement and the CBD should be mutually supportive and that
the Council should take appropriate steps to prevent any potential conflict between these twoAgreements.  Any failure to achieve a successful mechanism to ensure the complementarity between
these two instruments would, he said , be detrimental to both agreements.
206. With respect to the document circulated by the EC, he sought clarification if the requirements
to demonstrate benefit sharing in the  use of the invention and evidence of prior informed consent were
part of the requirements established in the patent procedures.  He believed that benefit sharing andprior informed consent were key elements of the CBD and that, in the absence these two
requirements, the main gap between the TRIPS Ag reement and CBD would remain.  He also queriedIP/C/M/37/Add.1
Page 48
the EC about the legal consequences of non-compliance and asked for further elaboration with respect
to those lying outside the ambit of patent law.
207. Turning to traditional knowledge and the role of WIPO, he said that Brazil had participated
actively in WIPO's Intergovernmental Committee on Intellectual Property and Genetic Resources,
Traditional Knowledge and Folklore and did not agre e with the EC that the TRIPS Council was not
the right place to negotiate a protection regime for a complex new issue subject-matter like traditional
knowledge or folklore.  This issue should be discussed both in the WTO and in  WIPO, to the extent
of their own mandates, as well as in the CBD and th e FAO, to the extent of the contribution that each
organization could provide.
208. With respect to the effective sui generis  systems to protect plant varieties, Brazil agreed with
the EC that the UPOV Convention met the standard of effectiveness in Article 27.3(b) and that other
models might be equally effective, so that UPOV was not the only model to be followed.  Hewelcomed the flexible approach of the EC regarding farmers' rights and farmers' exemptions and
agreed that these could be justified under Articl e 27.3(b) or under Article 30 of the TRIPS Agreement.
In his view, it was important to demonstrate how broad the scope of Article 30 was.  Finally, with
respect to definition of microorganisms, Brazil believed that one important point to bear in mind in
this discussion was that microorganisms as found in  nature should not be patententable.  In other
words, purification or isolation of microorganisms should not amount to patentable subject-matter.
209. The representative of the United States said that, as Members of the TRIPS Council knew
well, the view of his delegation was that Article 27.3(b) provided considerable flexibility for WTO
Members by allowing an exception to the mandate in Article 27.1 that patents be available for any
invention, whether product or process, in all fields of technology, so long as it met the standards ofpatentability.  Individual Members were free to exclude from patentability plants and animals and
essentially biological processes for the production of plants and animals.  By the same token,
Members were free to provide patent protection for such subject-matter and the United States did so,
so long as the inventions were new, useful and  non-obvious.  The US credited that level of protection
with the subsequent development of its strong biotechnology industry.  A Member that chose to availof the exemption allowed by 27.3(b) must ensure that, in doing so, protection remained available for
microorganisms and for non-biological and microbiological processes that met the standards of
patentability.
210. The United States agreed with the EC's statement that trying to define terms such as
microorganisms in the TRIPS Council was not the be st way forward.  Technology in this field was
advancing so rapidly that, even if Members were able to agree on a definition, it would most likely
soon be outmoded.  Currently there was no consensus among patent experts on a definition ofmicroorganisms as it applied to patents and in addition, because  the subject was an extremely
technical one,  if any effort was to be made to develop such a definition, the more appropriate forum
would be the WIPO Standing Committee on Patents.   Article 27.3 (b) required a Member that chose
not to provide protection for plant varieties under its patent law to provide an effective sui generis
system for the protection of plant varieties.  However, Members were free to do both as the UnitedStates did.  The US believed that the standards provided by UPOV 1991 were appropriate standards
for an effective sui generis  system of protection for new varieties of plants. Adherence to such
standards would help to ensure a more uniform international system of protection for plant varieties
around the world.  A lack of such uniformity could reduce market access for small plant breeders and
biotech developers because obtaining and maintaining protection in other markets would be more timeconsuming and costly.  He reiterated that if other systems that were similarly effective could be
developed, the US would certainly encourage Members to explore using those other systems as well.
The US believed UPOV was an existing mechanism that provided the type of uniformity that would
facilitate trade in this area.IP/C/M/37/Add.1
Page 49
211. His delegation believed strongly that patent systems provided an incentive to the best and the
brightest world-wide to invest in research and development of products and processes that improved
lives.  As his delegation had noted in a prior paper, the incentives provided by the patent system over
the last two decades had brought about myriad inventions in agricultural biotechnology that had
improved crop yields for farmers and reduced dependence on chemical pesticides, herbicides and hadimproved the nutritional level of food.  On the pharmaceutical biotechnology side, hundreds of highly
accurate tools for diagnosing and treating diseases and other physical afflictions had been developed
in recent years and more were in the pipeline.  A search of the patent database of the  kind of
examples of patents granted and sought in the United States had highlighted the fact that it was not
just developed countries that sought patents on biotechnological inventions.  For example, on
September 3
rd  2002 a patent had been granted to an entity in Brazil for the method of producing a
recombinant anaemia virus.  On May 15th 2001, a patent had been granted to a research institute in
Egypt, together with the University of Wyoming, for a particular form of a bacteria.  Similarly,  the
Council of Scientific and Industrial Research in India had been granted a patent for a bacteria that
produced a protease inhibitor and there were many other such examples. He said that it would not be
in the interests of any Member to preclude the patenting of plants and animals and microorganisms
and that the US was keen on always retaining such patents under its law.  He believed that theseexamples, and others that could be found, demonstrated that substantial potential existed in many
developing countries for a strong biotechnology indus try.  In this regard, he urged all Members to
explore thoroughly the benefits of patent grants in this area.
212. The representative of the European Communities said that, in accordance with Article 27.3(b),
Member countries would have to provide for the protection of plant varieties either through patents or
through an effective sui generis  system or by any combination thereof.  He said that the provision
gave no further guidance of what was to be understood by an effective sui generis  system and that the
absence of a definition meant that Members had a considerable degree of flexibility in determining
how their legislation should meet the standard of effectiveness and in designing a protection regime
that was appropriate to their specific national situations.  A growing number of WTO Members hadsigned the UPOV Convention which was, in his view, an effective, flexible and  widely recognized
model for the protection of plant varieties, given that it was subscribed by fifty or more countries.
However, while UPOV 1978 and 1991 should be considered as meeting the standard of effectiveness
under Article 27.3(b) of the TRIPS Agreement, these were, as stated explicitly in their
communication, not necessarily the only valid or effective sui generis  systems for plant variety
protection and other models might exist. However, in order to be effective, any protection regime for
plant varieties should respond to a certain number of criteria, as had been stated in theircommunication.
213. Turning to "farmers' rights" and "farmers' exemptions", he clarified that 'farmers rights' were a
set of measures that recognized the ancestral role of farmers in developing food crop varieties and
preserving biodiversity, as set out under Article 9 of the new FAO International Treaty on Plant
Genetic Resource for Food and Agriculture, and that "farmers' exemptions", on the other hand, wereexemptions to plant variety rights or patents which allowed farmers to save, use for further
multiplication, exchange or sell seeds of protected varieties of plants.  For instance, both the EC
regulations on plant variety rights and  the directive on Legal Protection of Biotechnological
Inventions contained the so called "farmers' privilege" clause which applied to the main food crops.
These allowed small farmers to freely use protec ted seeds for further multiplication on their own
holdings.  Farmers with smaller sized holdings were required to pay an equitable remuneration
appreciably lower than the amount charged to big farmers, to whom normal conditions applied. His
delegation considered that farmers' exemption could be justified under Article 27.3(b) of the TRIPS
Agreement as an exception to plant variety right protection, or under Article 30 of the TRIPS
Agreement as an exception to patent protection on genetic resources for food and agriculture, as thecase may be.  However, it should not deduced from the EC's communication that Article 30 of the
TRIPS Agreement allowed for  broad exceptions.IP/C/M/37/Add.1
Page 50
214. Finally, he said that in many least developed or developing countries all or part of the farming
activity was performed on small farms at subsistence level and that all commercial activities of
farmers were of limited geographical scope.  In these situations, his delegation was of the opinion that
such developing country Members might well create, in their national laws, a broader farmers'
exemption for the benefit of subsistence farmers or small farmers who lacked access to financialresources for new seeds every growing season.  This would allow them to save, re-plant, exchange,
share and re-sell seeds to other small farmers, provided they did not use the denomination of the
variety or the related trademark.  However, farmers with significant commercial interests should be
subject to the normal rules.
215. The representative of Japan said that his delegation had not changed its position on the review
of  Article 27.3(b) since submitting its position paper in document IP/C/W/236.  He said that Japan's
position also remained consistent and unchanged with respect to the relationship between the CBDand TRIPS Agreement.  He made preliminary observations with respect to tiret 95 of outstanding
implementation issues, especially the issue relating to  the recent international treaty established under
the FAO, stating that he found it premature to star t discussion on this issue in the TRIPS Council.  In
his view,  it would be appropriate to wait for the discussion to develop in the FAO or other fora
because this treaty had not yet entered into force.  There were various unclear points regarding theinterpretation of Article 12.3(d) of that treaty which could be more appropriately clarified through the
discussion on material transfer agreements within the framework of the FAO.
216. With respect to protection of traditional knowledge and folklore, he said that this issue had
been extensively discussed at the Intergovernmental Committee of WIPO from the view point of
intellectual property experts.  Therefore, his delegation would be cautious about starting discussionsin the TRIPS Council as it was better to wait for the development and results from that Committee.
Turning to the issue of disclosure and origin of genetic resources and prior informed consent, he
thought that purely from the viewpoint of patent gr anting procedures, these could not be considered as
requirements for necessary disclosure to carry out the invention under Article 29.1 of the TRIPS
Agreement.  He believed that the additional obligations should not be put on patent applications underthe TRIPS Agreement only related to biotechnological inventions.  Since the requirements of
disclosure of origin of genetic resources and evidence of prior informed consent were not
patentability-related issues, but rather additional procedures or formalities related to patent grant, he
was concerned about consistency with Article 62.1 of the TRIPS Agreement.
217. The representative of Peru agreed with the EC that Article 27.3 (b) contained flexibilities
which had to be maintained, particularly in order to avoid unilateral pressure to take on higher
commitments than those in the Agreement.  Her delegation had doubts as to whether the TRIPS
Council should clarify and study the issue of microorganisms because in the case of a dispute, it
would be in the hands of a special body and the Appellate Body, which was not desirable.  However,
she did not think that the WIPO was the sole forum to study this aspect.  In her view, the inclusion of
the issue of farmers' rights in the discussion was relevant because Article 27.3 (b) specifically referred
to the protection of plant varieties and many Members had included provisions regarding farmersrights in their legislation.  She also suggested that the FAO should be invited to make an oral
presentation with respect to document IP/C/W/347 at the next meeting of the TRIPS Council.
218. The representative of Singapore said that the subject under discussion was a difficult one,
particularly because it was still evolving.  He said that Members should take into account the
developments in the field of biotechnology during the review of Article 27.3 (b), because the issue ofpatentability of genetic material was, in addition to the provisions of Article 27.3(b), governed by
these developments. However, in his view the TR IPS Council should be slow in making any changes
that would affect the emerging world of biotechnology.  He recalled the point raised by a number of
delegations with respect to the discussions taking place in other fora, such as the WIPO and the FAO,
related to this issue and said that it would be helpful for the TRIPS Council to monitor closely the
developments in other fora and take on board issues relevant to its work.  There would be a danger ofIP/C/M/37/Add.1
Page 51
duplicating work and creating unnecessary controversy in relation to areas which may be more
usefully discussed in terms of expertise in other fora.
219. With respect to the relationship between CBD and the TRIPS it was important to recognize
the need to examine the issue of complementarity between the two agreements.  It would be useful to
bear in mind the principles of treaty interpretation and that agreements needed to be examined in a
way that did not create conflict by identifying areas of potential conflict and finding ways to resolve
such conflicts.  Regarding patentability of genetic materials under the CBD, he said that overly broad
patents granted in certain countries was an issue that other delegations should convey to their capitals
and ensure that such acts were avoided in the cour se of implementation of their legislation.  Turning
to prior informed consent and benefit sharing, he sa id that these were difficult issues, since one side
maintained that these issues should be dealt with at multilateral level while the other side pointed out
that doing so went beyond the boundary of intellectual  property and stepped into an area that was best
dealt with at the bilateral level through contracts.  He said that the Council should continue examining
this issue and take note of activities elsewhere, including the work in the WIPO committee.
220. The representative of UPOV said that the task of UPOV was to provide and to promote an
effective system of plant variety protection aimed at encouraging the development of new varieties of
plants for the benefit of society, whether in a developed or developing country.  UPOV had 51Members, many of whom were developing countr ies, who had experienced beneficial effects with
regard to productivity, competitiveness, income and development through plant variety protection.
He said that the plant variety protection system of the European Union was based on the UPOV
Convention, and that 13 of its member States were  contracting parties to the UPOV Convention.  He
pointed out that UPOV was the only existing sui generis  system for the protection of new varieties of
plants which was internationally recognized.  He referred to paragraph 77 of the EC concept paper
(IP/C/W/383) enumerating the criteria for an effective regime for plant variety protection and said that
the plant variety protection system established on the basis of the UPOV Convention met all these
criteria and was therefore compatible with Article 27.3 (b) of the TRIPS Agreement.  The UPOV
Convention provided for an effective sui generis  system at the national level as well as a system of
international harmonisation for plant variety protection so that all breeders in all UPOV member
countries could enjoy the same level of protection.  He said that enhancing international
harmonisation was an indispensable tool for the protection of new varieties of plants, for international
trade and transfer for technology.  If a country were to introduce its own system of protection, plant
breeders in that country would not enjoy the bene fits derived from international harmonisation and
this could complicate and distort international trade in seeds.  In such a case, breeders in UPOV
member countries would be hesitant to release their varieties there and this would mean that farmersin that country would lose the possibility of benefiting from the use of the best varieties developed.
Further, the introduction of a system which was not compatible with the internationally harmonized
system raised questions with regard to the spirit of the TRIPS Agreement.
221. He continued that at the national level, the most important element in agricultural policy was
the development of the seed industry and the protection of new varieties of plants was considered tobe one of the most effective tools for that purpose.  All countries wanted to have a competitive seed
sector composed of companies from both the public and private sectors and, since both sectors needed
financial resources to maintain a breeding programme for new varieties, additional financial resources
could be provided through an effective system of  plant variety protection.  He said that the UPOV
Convention required, for reasons of market transparency, the use of a given variety denominationwhenever seed of a protected variety was traded.  He referred to IP/C/W/383 and said that it described
the possibility of reducing the level of protection by allowing the sale of seeds without using the
variety denomination.  This carried the risk of creating confusion and undermining the whole system
because it made it difficult, if not impossible, for the breeder to recover the cost of his breeding
program.  He emphasized that the practices of farmers in relation to unprotected varieties and landraces would not be affected in any way by the in troduction of the UPOV system of plant variety
protection.  The UPOV system was designed to encourage the development of new varieties of plantsIP/C/M/37/Add.1
Page 52
for the benefit of society that provided benefits to both breeders and farmers.  It included exemptions
to farmers for the use of protected varieties for private and non-commercial purposes, including for
subsistence farming.  Farmers could, for example, use protected varieties for experimental purposes
and for breeding other varieties.  In addition, farmers might be permitted to use farm saved seeds of
protected varieties but such permission should be within certain constraints designed to ensure that theincentives for breeders to develop new varieties were not undermined.  Further, farmers could develop
and protect their own varieties under the UPOV Convention.
222. Moreover, he said, the UPOV system provided greater flexibility to a public breeding station
that had been granted breeders' rights with respect to conditions for permitting the exploitation of the
protected variety.  The breeder might, for instan ce, allow a farmer to exchange or sell seeds to
neighbours.  Public research institutes in many developing countries played a very important role in
the breeding of staple food crops and were free to allow their protected varieties to be distributedthrough traditional channels from one farmer to another, while excluding the varieties from
commercial use by other competing entities.  In th is regard,  the UPOV system was compatible with
the use of traditional channels when breeders, especially public research institutes, wished to use such
channels.  Therefore, the lack of adequate protection for new varieties in developing countries could
result in a failure to provide a key incentive for potential investment to develop agriculture.Consequently, developing countries would lose an opportunity to develop their national agriculture,
horticulture and forestry sectors and to enhance their overall economic development.  He said that
UPOV recognized the importance of capacity building and had a capacity building programme
covering more than 90 countries in Africa, Asia, the Pacific region, Latin America, the Caribbean and
in countries in transition.
4
F. RELATIONSHIP BETWEEN THE TRIPS A GREEMENT AND THE CBD
223. The representative of India recalled his delegation's detailed response made at  the last
meeting to concerns expressed by Members on India's proposals on disclosure and prior informed
consent and added that one concern that had been expressed was that benefit sharing should be
achieved through privately concluded bilateral contracts and that  national law could establish a legalbasis for such contractual agreements.  In his view, it was evident that Members recognized that
contracts could be entered into prior to transfer of biological resources and knowledge and that the
elements of such contracts could be prescribed by national law.  In view of this, opposition to the idea
that Article 29 of the TRIPS should mandate disclosure that such contracts had indeed been entered
into was surprising.  He said that his country, and several others, had not opposed bilateral agreements
for achieving benefit sharing.  His country's position was that the law should lay down the minimum
standards for prior informed consent and benefit sharing as required under the CBD.  This could befacilitated further through model forms of material transfer agreements and information transfer
agreements.  The agreements could not however conflict with the basic framework of the CBD for
access, prior informed consent and benefit sharing which was recognized in the laws adopted by
several countries.  A contract against the principles of CBD and against the national law
implementing the CBD would, therefore, be struck  down as violative of public policy.  Disclosure
norms that mandated full disclosure of source, whether contracts were entered into and whether
national laws on access and benefit sharing were complied with or not, would act as a deterrent
against access and unauthorised use by any patent applicant.  It would also act as a self-monitoring
and auto-check mechanism leading to lesser in stances of unauthorised use and the onus would be
entirely on the patent applicant to provide the relevant information. It was, therefore, difficult to seehow such a requirement would raise administrative co sts for governments.  Further, it was evident that
national law requiring bilateral agreements alone was not adequate, especially in the case of genetic
resources and knowledge that were easy to take  away under conditions where countries rich in
biodiversity and traditional knowledge did  not ha ve the capacity to track violations on their own.
                                                     
4 For conclusions, see paragraphs 256 and 257.IP/C/M/37/Add.1
Page 53
224. Another set of concerns expressed by some Members was that expanding the norms of
disclosure could be contrary to the non-discrimination clause under Article 27.1 of the TRIPS
Agreement.  His delegation failed to appreciate how such norms could be considered as contrary to
the non-discrimination principle since the same norms would apply equally to both foreign and
domestic patent applicants.  The argument of discri mination on the basis of the field of technology too
was not well-founded because when inventions in the field of technology involved the use of bio-
resources, the special circumstances surrounding such resources and associated information mandated
additional norms for disclosure.  He said that it was an established principle of interpretation that
treating dissimilar fields of technology differently would not be contrary to the principle of non-
discrimination.  He noted that some Members had indicated that the proposal to introduce additional
conditions for disclosure in Article 29 would go beyond CBD because it was up to each contracting
party to establish its own system for controlling access to genetic resources and benefit sharing.However, he said, contracting parties to the CBD had themselves recognized that patents and other
intellectual property rights might influence the implementation of the Convention and had pointed out
that such rights should be supportive of and not  contrary to the objectives of the Convention.
Therefore, his delegation had proposed, in this context, that the patent rights were not enjoyed at the
expense of violating the provisions of national le vel regimes for implementing the objectives of the
CBD and hence patents contrary to the objectives of the CBD should not be granted.
225. The representative of the European Communities said that his delegation was fully aware of
the need for the Council to take decisions on the three agenda items which their communication had
addressed.  Turning to the relationship between the CBD and the TRIPS Agreement, he said that the
CBD, on one hand, clearly acknowledged the need to adequately and effectively protect intellectualproperty rights and urged its members to ensure that intellectual property rights were supportive of its
objectives.  The TRIPS Agreement, on the other hand, did not refer to the principles of the CBD on
access to genetic resources and benefit sharing arising from their use.  However, this did not mean
that the TRIPS Agreement would run counter to the CBD.  In his view, these two agreements did not
conflict from a legal perspective and there was nothing in the provisions of either that would prevent acountry from fulfilling its obligations under both.  For instance, the CBD did not prohibit patents on
inventions using genetic material.  Similarly, the TRIPS Agreement did not prevent signatories to the
CBD from exercising their right to regulate access to their genetic resources, to require prior informed
consent or to share in the benefits arising from their use.  However, it would not be correct to close
the door to any debate on the grounds that, in the absence of legal incompa tibility between the two
agreements, there cannot be a problem with implementing both agreements, because there was
considerable interaction between the rights referred to under the TRIPS Agreement and the subject-matter of the CBD.
226. The TRIPS Agreement, in its implementation, could be used to support the objectives of the
CBD such as the fair and equitable sharing of benefits arising from the use of genetic resources, since
there was scope for congruence of interests between providers and users of intellectual property
rights.  Furthermore, the latter contributed to creating benefits stemming from the use of geneticresources in the form of financial returns or access to the relevant technology. For this reason, his
delegation was of the view that any examinatio n of the link between the CBD and the TRIPS
Agreement should focus on the ways and means of implementing both instruments in a mutually
supportive manner and on creating an interface between the two.
227. At national level, it was his delegation's view that it was the duty of WTO Members and the
CBD signatories to honour their commitments.  He said  that both agreements allowed for a significant
degree of flexibility with regard to national implementation and this left scope for a balance in their
application.   Further synergies in their implementation could be created at the international level.
Therefore, it was important for governments to ensure policy coherence in dealing with issues
relevant to the interplay between the TRIPS Agreement and CBD, in order to ensure an integratedapproach across institutions.  In that context, he re iterated that granting observer status to the CBD in
the TRIPS Council would play a crucial role in crea ting a clear appreciation of the links between theIP/C/M/37/Add.1
Page 54
two agreements.  He added that the direct relations hip between the work in the CBD and that of the
TRIPS Council, as expressed in paragraph 19 of the Doha Ministerial Declaration, made such
observership indispensable. It was also important to underline that legislative, administrative and
policy approaches, on the one hand, and contractual approaches, on the other, should not be set
against each another.  He said that in his delegation's view, multilateral rules, national regulatory orpolicy measures and contractual arrangements were complementary instruments in securing the
principles of the CBD.   The EC therefore welcomed the Bonn Guidelines on Access to Genetic
Resources and Benefit Sharing which set out practical ways and means of implementing the core
principles of the CBD.
228. Turning to disclosure requirements, one of the key chapters in the EC communication, he
noted that a number of Members had expressed the view that the TRIPS Agreement should be
amended in order to reconcile or harmonize it with the CBD.  Further, he noted the proposals made toincorporate a requirement into the TRIPS Agreement that patent applicants disclose the geographical
source and origin of the genetic material used and produce an official certificate or evidence that
domestic laws on access and benefit sharing of the source country were respected.  He said that his
delegation agreed that there was need to examine and discuss the possible introduction of a system at
the global level such as a self-standing disclosure requirements that would allow Members to keeptrack of all applications and patents granted for genetic resource-related inventions.  He saw merit in a
system that would ensure transparency and allow national authorities granting access to genetic
resources to keep track of patent applications linked to the use of these resources.  However, he said,
the information provided by patent applicants under such a system should be limited to geographic
origin of the genetic resources or traditional k nowledge used in the invention, and that such a
disclosure requirement should not act as an additional formal or substantial patentability criterion.  He
elaborated that the legal consequences of respecting  such requirements should lie outside the ambit of
patent law.   He referred to the questions raised by the Brazilian delegate on this matter and said that
the EC's proposal was that each country should decide for itself how it would provide for sanctions
when there were violations of the disclosure obligations but that such sanctions should be outside thepatent legislation.  In his view, such a system of disclosure would meet concerns expressed by a
number of WTO Members and would also help to prevent misappropriation of genetic resources and
related traditional knowledge by allowing patent offices to establish novelty more accurately through
focused searches.  Further, it would help countries providing access to genetic resources to monitor
and keep track of compliance with the rules on access and benefit sharing rules.  He referred to the
question posed by the Brazilian representative on prior informed consent and the need to demonstrate
the existence of benefit sharing schemes and agreed that disclosure requirements was the way forwardto the discussions in the TRIPS Council.
229. The representative of China said that, as the Brazilian delegate had pointed out, her delegation
was not so sure whether the disclosure requirements in the EC concept paper were the same as those
proposed by the developing countries as contained in documented IP/C/W/356. She reiterated that her
delegation believed, from the perspective of sustainable development of mankind, that the TRIPSAgreement and the CBD were mutually supportive.  The TRIPS Agreement focused more on the
protection and dissemination of technology, while the CBD was targeted at sustainable development.
She said that the protection and dissemination of technology would improve and facilitate sustainable
development although this did not mean that the two international instruments could automatically be
implemented in a mutually supportive manner.  For this reason, her delegation believed that theTRIPS Council should discuss thoroughly the means and ways of ensuring that the TRIPS Agreement
and the CBD were interpreted and implemented in a mutually supportive manner. In this regard, her
delegation suggested the incorporation of the basic rules recognized by the CBD into the TRIPS
Agreement, such as national sovereignty, prior info rmed consent, and equitable sharing of benefits.
She also believed that amendment of the TRIPS Agreement was indispensable to fulfil theserequirements and suggested that the TRIPS Council should recommend these amendments to the TNC
by the end of 2002.IP/C/M/37/Add.1
Page 55
230. The representative of Columbia, speaking behalf of the members of the  Andean Community,
namely, Bolivia, Columbia, Ecuador, Peru and Venezu ela, said that with respect to the relationship
between intellectual property and the objectives of the CBD and in light of the implementation plan of
the recent summit on sustainable development held in Johannesburg, the worrying trend of loss of
global biodiversity could only be slowed down if at least (1) the local population of the countries oforigin of biodiversity benefited from the preservation and sustainable use of biodiversity; (2) the
objectives of the CBD were integrated into sectoral and inter-sectoral programmes and policies; and
(3) there was access to the results and benefits derived from biotechnological innovations based on
genetic resources.   Further, the WSSD had made an appeal to countries to move toward an
international regime for sharing of benefits resulting from access to genetic resources, whilst bearing
in mind the fact that intellectual property rights could not be seen in isolation from a whole set of
factors which were political, economic, ecological, legal and social.  Therefore, the internationalcommunity should, in light of that and by virtual of the appeal from the Johannesburg summit,
consider transferring of technology protected by intellectual property rights as a means of
implementing the requirements for sharing of the benefits derived from access to genetic resources
and as a contribution of the TRIPS Agreement towards the objective of sustainable development.
231. He continued that the Andean Community held the view that Members must have in place
international mechanisms that were effective in ensuring defensive as well as positive protection of
the rights of countries of origin of genetic resources, knowledge, innovation and practices of
indigenous and local communities.  The TRIPS Agreement could create a favourable environment for
research and development in biotechnology by incorporating requirements for disclosure of the
country of origin of genetic resources and traditional knowledge that was used in the invention andproof of fair and equitable sharing of benefits as well as proof of prior informed consent.  He said that
all of these elements were part of the criteria of the Bonn Guidelines agreed to at the Sixth Conference
of the Parties to the CBD recently at the Hague and stressed the importance of the TRIPS Agreement
in assisting attaining the objectives of the CBD through the maintenance of mutual support, synergy
and integrity of both instruments.  In this regard, he reiterated the importance of giving the CBDobservership in the TRIPS Council.
232. The representative of Canada reiterated her delegation's view that the TRIPS Agreement and
the CBD could be implemented in a mutually supportive and consistent manner and that they did not
conflict with each other from a legal perspective. She emphasized the importance of the TRIPS
Agreement and the role of intellectual property rights in promoting innovation and in the
dissemination of the resulting technology.  At  the same time she recognized the importance of
preserving global biodiversity in order to achieve environmental objectives and sustainabledevelopment.  Her delegation took seriously developing country Members' concerns related to genetic
resources and benefit sharing and recognized the n eed for international cooperation to address these
concerns.  She said that her delegation was working hard, in a variety of international fora, to achieve
this goal.  Canada itself possessed a significant diversity of national resources similar to many
countries in the TRIPS Council and was keen to promote both biotechnological innovation andbiodiversity conservation.  However, she did not share the view that altering the flexibility inherent in
27.3(b) would be helpful in that regard and did not support the idea of using the intellectual property
regime to enforce the provisions of environmental agreements, or any other agreement for that matter,
unless it could be conclusively demonstrated that such a link was necessary to achieve the innovation-
related objectives that underlie intellectual property rights themselves.  Rather, she believed that thesolution to concerns about the implementation of access and benefit-sharing provisions of the CBD
was best achieved through the development of effective national access laws which would require
material transfer agreements to be entered into on mutually agreed terms.  Such agreements would be
more effective than trying to police the terms of access at the time when a patent was to be granted on
a resulting innovation. Therefore, she supported biodiversity-rich Members developing their ownnational access laws in a manner that ensured both and facilitated access to genetic resources for
continued use in valuable research and the fair and equitable sharing of benefits.IP/C/M/37/Add.1
Page 56
233. In light of the WSSD decision to negotiate an international regime on benefit sharing, Canada
preferred to continue working constructively, as it had been for some time in the relevant working
groups of the CBD, to build on voluntary guidelines de signed to assist biodiversity rich countries in
establishing effective national access laws.  She added that the recent initiative in the WIPO
Intergovernmental Committee to establish a database of sample contractual terms would certainlycontribute to these efforts and that Members should allow that work to run its full course before
beginning a comprehensive assessment of the merits of the proposals that were before the TRIPS
Council.
234. The representative of the United States referred to a  paper that his delegation had introduced
a year ago in which each of the provisions of the CBD that might bear any relationship to intellectual
property had been analysed.  The paper had also described in detail the way in which a contract
system provided for in national law would be both an efficient and effective way for granting accessto genetic resources and for ensuring benefit sharing, including the transfer of technology.  He said
that he was relieved to hear more Members in the TRIPS Council acknowledging that there were
actually no conflicts between the TRIPS Agreement and the CBD and that he was aware of some
interest in continuing to explore whether there might be some hypothetical situations where
implementation of these two instruments were in conflict.  His view was that such an effort might notbe the best use of the Council's resources since Members were aware of the exercise being made by
the WIPO of collecting examples of provisions in access and benefit-sharing contracts concerning
intellectual property and genetic resources through a recently distributed questionnaire. This study,
once completed and its results distributed to the members of the Intergovernmental Committee, would
provide significant experience in this area and would enable those with less experience to rely on theprovisions that had already withstood the test of time and law.  His delegation expected such an
exchange of information to diminish, to a great extent, any possible uneven playing field in this area
and so he urged Members seeking to regulate access to their genetic resources to continue considering
actively the careful implementation of an access regime establishing such a contractual system.  He
added that such a system could be put in place immediately, based on existing contract law andtherefore did not require waiting for the outcome of other discussions in the TRIPS Council or other
bodies.
235. He reiterated that a contractual system could ensure the sharing of benefits arising from the
commercialization of the results of research and development based on materials to which access had
been provided, whether or not these results were the subject of a patent.  Further, he said that contracts
could specify how disputes that might arise under any contract would be handled and in what
jurisdiction.  He recalled that there were a number of international agreements that dealt with mutualrecognition and enforcement of judgements in contracts and said that his delegation did not find that
any benefits would result from a requirement in patent law to disclose the source of genetic resources
related to research and development of an invention claimed in a patent.  On the contrary, his
delegation felt that such a requirement would needlessly impose burdens on patent applicants who
were using genetic material as the basis for resear ch and development currently without regard to the
source of the materials or to the significance of the materials to any end result.  The fact of the matter
was that even if a party that failed to disclose relevant information on the source of genetic resources,
where identified, was sanctioned through the  patent being declared invalid or unenforceable, no
benefit-sharing would accrue in the source country of those genetic resources.  However, he said that
successful suits for breach of contracts could, in fact , result in court orders for specific performance or
damages.  He suggested that perhaps Members could explore in more detail, at the next meeting, the
exact practical benefits and the expectations of the proponents from disclosure requirements, even
disclosure requirements that, as the EC noted, would not  in fact be linked in any way to patent status.
236. The representative of Brazil asked the Members to take into account elements already
provided in his previous intervention under the previous agenda items given that his delegation
understood that there were overlapping elements in the previous, current and next agenda items. In the
light of the intervention by the United States with respect to Brazil's participation in the developmentIP/C/M/37/Add.1
Page 57
of its own biotechnology industry, he said that last  year his delegation had highlighted this point.  He
said that Brazil's situation as a mega-biodiversity  country with a growing biotechnology industry only
supported their position and was not contrary to the development of the biotechnology.  Brazil's
proposal, on the other hand,  would encourage the development of the biotechnology industry, while
taking into account the objectives of the TRIPS Agreement to promote biotechnological innovationand the transfer and dissemination of technology to  the mutual advantage of producers and users of
technological knowledge.  He believed that the objectives of the CBD were similar and his delegation
understood that there could be complementarities between the CBD and the TRIPS Agreement if
Members took appropriate measures.
237. He continued that the proposal by developing countries concerning the relationship between
the TRIPS Agreement and the CBD lay in a tripod which included, as a condition for  acquiring patent
rights, the disclosure of the source and country of origin of the biological resources and of thetraditional knowledge used in the invention, eviden ce of prior informed consent and evidence of fair
and equitable benefit sharing under the national regime of the country of origin.  In his view, these
three elements were important in ensuring the mutual support between the TRIPS Agreement and the
CBD and therefore could not be isolated from each other.  While disclosure requirements were
certainly encouraged as one of the elements contained in the Bonn Guidelines, his delegation believedthat Members could not consider requirements alone without taking into account the core issues of
benefit sharing and prior informed consent.  He therefore urged the EC and other Members to ensure
that the objectives of the TRIPS Agreement did not run counter to those of the CBD.  In his view, an
amendment to the TRIPS Agreement would be necessary to ensure that the objectives of the two
instruments were complementary.
238. Turning to the points raised by India and the United States, he agreed that there was no
opposition in the TRIPS Council to bilateral contr actual arrangements or to the establishment of
national legislation.  However, he questioned whet her contracts or national legislation alone were
sufficient.  He said that certain contractual arrangements could hinder the holders of genetic resources
or traditional knowledge from benefiting from the commercial exploitation of their efforts.  He addedthat while national legislation was definitely a necessary step in ensuring access to legislation,
international action was also necessary.  Further, he said that there were no limits that prevented
countries from allowing the patentability of genetic resources without providing for the use genetic
resources in a sustainable way.  Turning to the issue of granting observer status to the CBD, he said
that to do so would be an important step forward but not sufficient in itself.
239. The representative of Kenya said that there seemed to be a common understanding of the need
for sharing of the benefits arising from the use of genetic resources for inventions in general, whether
a patent was granted or not.  His delegation agreed with the EC that the TRIPS Agreement and the
CBD could be implemented in a mutually supportive way.  He also agreed with the points raised by
the Chinese delegation that implementation of the two instruments in a mutually supportive manner
could be well reflected if Members initiated an amendment to the TRIPS Agreement in such a way
that allowed the incorporation of the CBD's relevant provisions, as had been the case with other
arrangements such as the Berne and the Paris Conventions.
240. Further, his delegation agreed with the proposal made by the EC that countries should
monitor the use of genetic resources, whether such use resulted in grant of a patent or not, although
this might be a relatively more expensive exercise beyond the reach of most of the countries.  He said
that his delegation would prefer disclosure provided in good faith and trust.  He supported theproposal to grant observer status to the CBD and said that it was important to do so because that could
assist Members in coming up with solutions to some of the problems that they might face in the
TRIPS Council in future.
5
                                                     
5 For conclusions, see paragraphs 256 and 257.IP/C/M/37/Add.1
Page 58
G. PROTECTION OF TRADITIONAL KNOWLEDGE AND FOLKLORE
241. The representative of Bolivia said that traditional knowledge was such an important world
resource that Members should actively support international efforts aimed at guaranteeing its
protection.  His delegation favoured an internatio nal system that would preserve and develop the
knowledge generated by the indigenous populations and communities.  He was concerned about theuse of traditional knowledge without authorisation from these populations and communities  and
about the fair and equitable sharing of benefits to them.  In his view, rules established nationally or
regionally on this subject were not sufficient and therefore his delegation sought the establishment of
a multilateral framework that would ensure effective legal protection and allow the legitimate
possessors of this knowledge to exercise effective control over access, use and exploitation, and
against reproduction, imitation, transmission and other trade acts related to traditional knowledge,
including its expressions and manifestations.  He added that the respective rights should be enforcedthrough an effective means of  compliance whose standards should not be lower than those already
established multilaterally.  He said the Council should work jointly with other relevant international
fora and bodies.
242. The representative of the European Communities said that their communication dealt with the
protection of traditional knowledge and folklore, including the development of a sui generis  system of
protection.  His delegation was of the view that preventive approaches to avoid misappropriation of
traditional knowledge through inappropriate patent ing could be dealt with by the TRIPS Council and
that this would require Members to explore methods of documenting and sharing information on
traditional knowledge.  He said that the EC supported proposals aimed at establishing databases and
registers that would allow patent examiners to take into account traditional knowledge in prior artsearches.  He drew Members' attention to the Swiss proposals on this issue and said that it would be
useful to re-examine them in this context.  In hi s view when traditional knowledge was used as a basis
for further innovations, disclosure of the original traditional knowledge would be an important way of
ensuring benefit sharing among holders of the traditional knowledge.  Therefore, the EC supported
further work towards the development of an international sui generis  model for the legal protection of
traditional knowledge in the WIPO .  In his view, at this stage the TRIPS Council was not the right
place to negotiate a protection regime for a  complex new subject-matter like traditional knowledge or
folklore, but the work being done by WIPO's Intergovernmental Committee should be built upon.
Based on the outcome of the WIPO process, Member s could then determine whether any further work
was warranted in the TRIPS Council.
243. The representative of Venezuela referred to comments made by her delegation at the last
meeting and said that her delegation was interested in seeing a report submitted to the TNC that
included all the items addressed by the developing countries in the TRIPS Council.  She supported the
proposal to amend the TRIPS Agreement in order to make it compatible with the CBD.  She said that
a database of traditional knowledge was an important element in determining novelty or inventive
step and would prevent bio-piracy.  In her view, the CBD and the TRIPS Agreement were mutually
supportive. In this regard, the relationship between the database and the status of technology was animportant issue requiring a solution that would make it possible to include certain elements of
traditional knowledge in the database without implying that such knowledge was part of the public
domain.  She reminded Members that there was no obligation in TRIPS to disclose the origin of the
genetic resources or the associated traditional knowledge when seeking patent protection.  Such a
proposal would guarantee transparency as well as facilitate Members in making use of their rights.She suggested that Members could have an in-depth debate aimed at establishing such an obligation
which could then be incorporated into national patent legislation.
244. With respect to the form and content of the proposed database, she said that there were many
issues pending and a long way to go before Members could decide to connect regional and national
patent authorities to an international network.  She wondered who would assume the cost of such an
electronic interconnection between databases and shared the view that if a decision was made toIP/C/M/37/Add.1
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establish such databases in future, then they should only contain the knowledge agreed to and
disclosed on a voluntary basis by the communities.  She added that Members should ensure that the
data contained therein did not facilitate patenting without the element of novelty, and also ensure
proper management of its use.  She said that her delegation was aware of the different competent
bodies in this area and emphasized the importance of complementarity between the work being donein various organizations within their own area of co mpetence.  Furthermore, she said that she was sure
that the work in WIPO would be strengthened by  the results that would emerge from the TRIPS
Council and vice versa and it was for this reason that she did not consider it desirable to study these
issues in one single organization.
245. The representative of Hong Kong, China referred  to an international symposium on traditional
medicines hosted by his country under the auspices  of the APEC intellectual property experts group
from the 19 to 22 of March 2002 and said that the report on this symposium was available andcirculated in document IP/C/W/377/Add.4.  He said that this symposium covered in detail issues
related to the intellectual property protection for the fruits of research in traditional medicines.  He
mentioned that the proceedings thereof were relevant to a number of issues being discussed in the
TRIPS Council, including public health, Article 27.3(b ), the CBD, traditional knowledge and folklore.
Further, he said that a record of the proceedings was available in DVD ROM format and had alreadybeen submitted to APEC Members.
246. The representative of New Zealand said that the protection of traditional knowledge was a
complex and sensitive issue for her delegation and internationally.  In the light of that, she was
concerned that submissions from Members focused primarily on mechanisms that could be used to
protect traditional knowledge without there being a prior understanding of exactly what suchprotection meant in the context of TRIPS.  She said that there were different views on this in her
country.  For instance, the Maori people of New Zealand considered 'protect' to mean to preserve
traditional knowledge and to prevent it from being used by anyone other than traditional knowledge
holders.  Others thought protection should allow for the development of traditional knowledge,
including where this involved use by others, and to enable traditional knowledge holders to share inany benefits that might result from it, where appropriate.
247. Some traditional knowledge holders in New Zealand considered their language and images to
be cultural treasures that should  not be used by others.  Such people were upset by recent events
where Maori language or imagery had been used without their permission, for example in a range of
"Lego" toys and in the design of "Adidas" rugby boots.  Others considered that there were some
aspects of Maori traditional knowledge which may be shared or even commercially exploited,
provided there was appropriate recognition of the sour ce of that knowledge.  In her view, intellectual
property rights were relevant in achieving the objective of facilitating the appropriate development of
traditional knowledge, although such rights would no t necessarily be able to achieve the preservation
of traditional knowledge.  In light of these differing philosophies, she said that her delegation was of
the view that engaging in discussions for specific mechanisms that could be implemented at the
international level might be premature.  Instead, it would be important to consider first discussing the
purpose of protection and the full range of mechanisms, whether intellectual property based or
sui generis , that might assist indigenous peoples to protect and develop their traditional knowledge.  It
would also be important to ensure that this process was informed by the wishes of the traditional
knowledge holders themselves.
248. With respect to New Zealand's intellectual property laws, she said that currently there were no
specific provisions in these laws directly aimed at the protection of traditional knowledge, although
aspects of traditional knowledge were protected, to some extent, by existing general intellectual
property laws within the limits inherent in those laws.  She added that her country had made progress
in developing measures that were specifically designed to either preserve or facilitate the appropriate
use of traditional knowledge.  For example, there was currently a bill before the New ZealandParliament which would amend the Trademarks Act to prevent the inappropriate registration ofIP/C/M/37/Add.1
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trademarks and enable the invalidation of existing trademarks that contained Maori text and imagery
where this would be offensive to a significant section of the population in New Zealand, including the
Maori community.  In addition, the government had funded, in the trademarks area, the development
of the Maori-made trademark.  This trademark was a certification of authenticity and quality,
indicating to consumers that the creator of the work they were buying was of Maori descent and wasof a particular quality.  This collective trademark was developed in response to concerns raised by the
Maori people regarding the protection of cultural and intellectual property rights, the misuse and
abuse of their concepts, styles and imagery and the lack of commercial benefits accruing to them.
Further, the government has continued to consider whether the development of a national sui generis
system to protect traditional knowledge would be appropriate.  She said that her country had also
provided assistance to Pacific Island countries which mandated the South Pacific Commission to
develop a draft model law for the protection of traditional knowledge.
249. With respect to international action to preserve and facilitate the use of traditional knowledge,
her delegation considered instituting appropriate measures at the national level to be an essential pre-
cursor.  She said that action at the international level might be necessary given that the global
economy was  interconnected.  However, she did not have any views on what form  such action
should take but said that her delegation would continue to work on this issue domestically and wouldparticipate in the work in other international fo ra, such as the WIPO, with the view to achieving
progress.
250. The representative of the United States said that the term 'traditional knowledge' much like
'intellectual property' was used to refer to a wide variety of subject-matter.  However, as the
representative of New Zealand had pointed out, unlike the situation with intellectual property, thesubject-matter of traditional knowledge had not really been clearly identified.  He said that his
delegation believed, as in the case of access to genetic resources, that access to traditional knowledge
could be provided for under national legislation that provided for contracts that ensured prior
informed consent and benefit sharing.  In addition, some forms of intellectual property rights such as
certification marks, law against misappropriation, tort law, moral rights and other such rights providedfor under national law could, in many cases, be used to facilitate or enhance the protection of such
knowledge.  Further, he said that using laws currently in force, and those already well understood,
would enable holders of traditional knowledge to pr otect such knowledge immediately.  In his view,
since traditional knowledge was often a combination of elements such as cultivation of genetic
resources, use of traditional medicine, ritual chants and  ritual dress, protection could be most
effective by using a combination of laws.
251. Turning to folklore, he noted that a number of countries, including his own, had described
how they already provided for the preservation of folklore.  He referred to the discussions underway
in WIPO's Intergovernmental Committee and emphasized that Members did not have to wait for the
conclusion of those discussions or of discussions in the WTO.   He said that various avenues were
currently available for Members interested in protecting traditional songs and encouraged those who
had not done so to join the WIPO Performances and Phonograms Treaty (WPPT).  The WPPTprovided for the protection of performances of traditional music and was the only neighbouring rights
treaty to explicitly include the protection of performers of expressions of folklore. Members could
also consider implementing the WIPO-UNESCO model provisions, adopted as far back as 1982, for
national laws on the protection of expressions of folklore against illicit exploitation and other
prejudicial actions.  Further, Members could implement sui generis national legislation to protect
traditional songs and/or other expressions of folklore.  He said that his delegation was aware that
some countries provided for a certain degree of protection of expression of folklore through their
existing copyright laws.  Consequently, his country had examined aspects where existing law could be
used to protect traditional knowledge and an agreement had been reached to protect against consumer
deception with respect to tribal expressions of folklore through the Indian Arts and Crafts Act.IP/C/M/37/Add.1
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252. The representative of Peru agreed with the statements made by the representatives of Bolivia
and Venezuela and was of the view that the TRIPS Council, in coordination with other relevant
international bodies, should look into ways of providing defensive and positive protection to
traditional knowledge that would be subject to  multilateral dispute settlement procedures.
253. The representative of India shared the view that databases for assessing  the genuineness of
novelty and inventiveness in a patent application involving the use of biological resources or
traditional knowledge was a useful tool that could be used by patent examiners world-wide.  In his
view, the need to stem the misappropriation of th e knowledge, innovation and practices of local and
indigenous communities formed the basis of the justification for the proposal that patent applications
should disclose compliance with norms of prior informed consent and benefit sharing as required
under national laws.   He added that such a provision only enhanced the commitment to ensure that
the patent applications covered inventions that were novel and inventive and built upon theinformation and resources obtained from the countries and communities of origin.  Turning to
databases of knowledge of local and indigenous communities, he said that these exercises had been
initiated in many countries and India's Traditional Knowledge Digital Library was an example of such
an effort.  He said that currently India's digital library sought to encompass only information on
biological resources that had been codified in Indi a's written texts, which was in itself an awesome
task given the vast breadth and depth of information available articularly.  However, he was aware of
the inherent limitations of this exercise, particularly that such databases could not be completely
comprehensive and exhaustive of all the existing traditional knowledge and bio-resources in India.  It
might not, for instance, cover knowledge and resour ces documented in the lesser known texts within
India's territory;  or that preserved by communities in its oral form;  or that which is constantlyevolving through informal innovations within a co mmunity.  Another nuance in the whole debate was
when information about a resource in the database actually led the inventor to use an undocumented
close relative of such a resource for the purposes of crafting his invention.  Further, information
contained in the patent application in current regimes might not contain elements that could be
directly traceable to such a database and a simple search of the database might not always yield adirect result with respect to the prior art.  In his view, mandatory disclosure of the source of
information and knowledge would be critical in addressing such grey areas.
254. The representative of Kenya said that Members, including his own country, that come from
regions where traditional knowledge was vibrant and highly practised, were aware of the advantages
that could arise from the protection of traditional k nowledge. In his view, the protection of traditional
knowledge was important to ensure that such knowledge was sustained because certain communities
or countries/societies that made use of it were unable to access modern technology.  In addition,traditional knowledge had proved to be more effici ent in certain instances in solving problems than
modern technology.  He cited an incident in a vill age Malawi involving a wild beast that demonstrated
the importance of traditional knowledge.  For this reason, regional groupings such as ARIPO were
look into ways of accelerating the mechanism for the protecting traditional knowledge.
255. The representative of Brazil reiterated that while the developing countries' proposal was
supported on the tripod of the three well-known requirements that he had cited earlier, the EC's paper
was based on only one leg, namely, the disclosure requirement. For this reason, his delegation
believed that the EC proposal might be insufficient to provide a sustainable solution to prevent acts of
bio-piracy abroad.  He associated his delegation with the view expressed the delegations of
Venezuela, Peru, New Zealand, India, Kenya and ot hers that the conventional intellectual property
system contained limitations to protect traditional knowledge effectively and adequately.  Turning to
databases, he shared the view that they could be useful in facilitating patent examiners' check against
patent requests relating to unauthorised use of the knowledge of traditional communities.  He also
shared the views of the delegations of Venezuela and New Zealand that the creation of databases
should not be based on information disclosed without the prior informed consent of their owners.  Hesaid that databases should not result in the facilitation of biopiracy and that this was an issue of
serious concern.IP/C/M/37/Add.1
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256. The Chairman proposed that the Secretariat be requested to periodically update its summary
notes on agenda items E, F and G, not after every meeting necessarily, but when significant new
material had been presented.  Furthermore, referring to the suggestion made by Peru, he proposed that
the Council invite the FAO to make a presentation on the International Treaty at the Council's next
meeting.
257. The Council took note of the statements made under these three agenda items and agreed  to
proceed as suggested by the Chair.
H. REVIEW OF THE IMPLEMENTATION OF THE AGREEMENT UNDER ARTICLE 71.1
258. The Chairman recalled that, at the Council's meeting in March 2002, the previous Chairman
had noted that a substantial number of suggestions for topics to be considered under the Article 71.1
review had been made prior to the Doha Minister ial Conference, but some of them had overlapped
with other items on the Council's post-Doha agenda.  In considering 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
present meeting, without prejudice to the right of Members to submit ideas at a later stage.  To date,
no suggestions had been tabled by any Members.
259. The Council agreed to revert to the matter at its next meeting.
I. IMPLEMENTATION OF ARTICLE 66.2
260. The Chairman recalled that, at Doha, Ministers had instructed the TRIPS Council to put in
place a mechanism for ensuring the monitoring and full implementation of the obligations under
Article 66.2 of the TRIPS Agreement.  The Ministers had also agreed that, to this end, developed
country Members should submit, prior to the end of 2002, detailed reports on the functioning in
practice of the incentives provided to enterprises for the transfer of technology in pursuance of the
commitments under that Article.  These submissions should be subject to a review in the TRIPS
Council and information should be updated by Members annually.  Therefore, the Doha Decision had
set out a clear time-frame for the submission of these reports by developed country Members, namely
by the end of 2002.  He also recalled that, in response to a request to developed country Members to
provide information on the implementation of their obligations under Article 66.2 of the TRIPSAgreement, many developed country Members had supplied information on this matter and the
TRIPS Council had discussed these submissions.  At its last meeting, the TRIPS Council had received
a communication from least-developed countries containing considerations for the establishment of a
monitoring mechanism under Article 66.2 of the TRIPS Agreement.
261. Given the need for early action to implement the Ministerial instruction and in the light of the
suggestions and discussions in the TRIPS Council and informal consultations, he had circulated an
informal note (JOB(02)/118) in which he had suggested a number of elements for the consideration ofthe Council that could form the basis of a decision on this matter.  Since delegations might need more
time to consider these suggestions, he suggested that the Council revert to the matter at its next
meeting.  He recalled that the Doha Decision called for detailed reports from each developed country
Member by the end of the year 2002.  Thus, he also suggested that developed country Members be
requested to make such information available for the Council's meeting in November 2002.  In doingso, they could be invited to use the guidelines contained in his informal note if they found them
useful.
262. The Council so agreed.IP/C/M/37/Add.1
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J. NON-VIOLATION AND SITUATION COMPLAINTS
263. 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: "The 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 ofGATT 1994 and make recommendations to the Fifth Session of the Ministerial Conference.  It is
agreed that, in the meantime, Members will not  initiate such complaints under the TRIPS
Agreement."  Thus, the TRIPS Council had a time-frame for its work, namely that it should be in a
position to make recommendations to the fifth Ministerial Conference, to be held in Cancún, Mexico
in September 2003.  As requested by the TRIPS Council at its meeting in March 2002, the Secretariat
had circulated prior to the June meeting in docum ent IP/C/W/349 a summary note of the points raised
in the substantive discussion of this agenda item so far.  At that time, he had also circulated anannotated agenda in document JOB(02)/66 raising a number of questions that Members might wish to
address.  However, at the June meeting, the Council had not had enough time to adequately discuss
this item.
264. In order to be able to prepare recommendations, the TRIPS Council would need to have
specific proposals from delegations, and have fully discussed them sufficiently in advance of the fifthMinisterial, so that Members had a clear picture of the options available and their implications. He
suggested that the first meeting of the Council in 2003 be set as a target date for the submission of
proposals while the Council might continue its discussion of the matter on the basis of the annotated
agenda still at the November meeting.  However, he said that this would not preclude earlier papers
which he encouraged Members to submit, or later ones in an effort to find common ground.
265. The Chairman said that the Council had just received a communication from Peru on behalf
of Argentina, Bolivia, Brazil, Cuba, Ecuador, Egypt, Malaysia, Pakistan, Peru, Sri Lanka and
Venezuela.
266. The representative of Peru, introducing the joint communication on behalf of its co-sponsors,
said that it was a priority task for the Council to reach a consensus on non-violation and situation
complaints with respect to the TRIPS Agreement in order to fulfil the mandate given by the Doha
Ministerial Conference, which had instructed th e Council to make recommendations to the fifth
Ministerial Conference.  She believed that it was a wrong assertion that the expiration of the deadline
provided in Article 64.2 of the TRIPS Agreement might make non-violation and situation complaints
automatically applicable to the TRIPS Agreement.  Article 64.1 of the TRIPS Agreement established
that Article XXIII of GATT was applicable to the TRIPS Agreement, subject to Articles 64.2 and 64.3
of the TRIPS Agreement.  Despite the expiration of the time-period provided in Article 64.2, non-violation and situation complaints were only appl icable to the TRIPS Agreement in conformity with
the procedures established in Article 64.3, i.e. once consensus had been achieved on the issue.
267. She was in favour of a transparent, predictable and equitable mechanism for settling trade
disputes.  However, she believed that the application of non-violation and situation complaints to the
TRIPS Agreement raised some fundamental concerns.  It was not necessary because the TRIPSAgreement, unlike other WTO agreements, was a  sui generis  agreement.  It was not designed to
protect market access or the balance of tariff concessions but rather to establish minimum standards of
intellectual property protection, which, if abused, might even undermine market access.  Non-
violation and situation complaints were unnecessary to protect any balance of rights and obligations
internal to the TRIPS Agreement, as these were re flected in the Agreement's principal obligations and
flexibilities, and the Agreement explicitly stated  that WTO Members were not obliged to implement
more extensive protection.  Rights and obligations in the TRIPS Agreement were best effected
through WTO Members' good-faith application of its provisions in accordance with established
principles of international public law recognized by the Appellate Body of WTO.  TheIP/C/M/37/Add.1
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implementation of the TRIPS Agreement did not require recourse to the legally imprecise notion of
non-violation and situation complaints.
268. The application of non-violation and situation complaints also raised systemic concerns by
introducing incoherence among different WTO agreements, which could nullify or impair the benefits
in the TRIPS Agreement.  It also threatened to upset the balance of rights and obligations in the
TRIPS Agreement by elevating private rights over the interests of the users of intellectual property –
both within and between the countries and over other important public policy considerations in a
manner inconsistent with Article 3.2 of the DSU.  It could also undermine the regulatory authority and
infringe sovereign rights by exposing to challenge any measure that affected IP and that could not
have been foreseen at the time of the Uruguay Round.  Furthermore, it threatened to limit the
flexibilities inherent in the TRIPS Agreement to secu re objectives relating to legitimate policies, such
as protection and promotion of public health, nutrition, environment, biodiversity, enhancement oftransfer of  technology and other issues of public interest in sectors of vital importance to socio-
economic and technological development.
269. She believed that the benefits accruing under the TRIPS Agreement were adequately
described in its text, including its preamble, objectives and principles, which fully took into account
the development dimension.  These benefits ensured that measures and procedures for theenforcement of IPRs did not become barriers to legitimate trade, the promotion of technological
innovation and transfer and dissemination of technol ogy, and that the mutual benefits to producers
and users of technological know- how could enhance social and economic well-being.  The balance
between rights and obligations, protection of public health and nutrition, and promotion of public
interest in sectors of vital importance for the so cial, economic and technological development, could
ensure that IPRs did not limit trade in an unjustifiable manner or be detrimental to international
transfer of technology.  Such benefits, which accrued to Members rather than to private entities, were
adequately protected through good-faith application, and did not require recourse to a legally
imprecise notion of non-violation and situation complaints.
270. Continuing, the representative of Peru said that she welcomed other Members' attempts to
clarify and narrow the definition of measures that might give rise to non-violation and situation
complaints.  However, defining "measure", even narrowly, would not address concerns that the
remedy would infringe sovereign rights and undermine the Agreement's flexibilities.  These concerns
arose not merely from a lack of clarity about which measures could be challenged, but more
fundamentally from legal uncertainty inherent in the concept of non-violation and situation
complaints.  There was insufficient guidance in Article 26 of the DSU and in GATT dispute
settlement practice for panels and the Appellate Body to apply non-violation and situation complaintsin the context of the TRIPS Agreement.  Extending the non-violation and situation remedy – and with
it the right to challenge measures that were otherwise consistent with WTO obligations – might
unbalance the proper distribution of responsibilities between WTO Members, panels and the
Appellate Body.  All these concerns raised fundamental challenges to the multilateral trading system.
Introducing non-violation and situation complaints in the TRIPS context was unnecessary and createdtension with the security and predictability provided by the multilateral trading system.  It was
incompatible with the long-term best interests of the multilateral trading system and of all the WTO
Members.
271. In the light of these concerns, she proposed that the TRIPS Council recommend to the fifth
Ministerial Conference that non-violation and situation complaints under Article XXIII.1(b) and (c) ofGATT 1994 be determined inapplicable to the TRIPS Agreement.
272. The representative of Chile said that it was important for the TRIPS Council to make
recommendations to the fifth Ministerial Conference on the issue of non-violation and situation
complaints.  The communication of Peru offered a lot of interesting food for thought for the future.
He noted that the historical development of this concept under GATT was of great interest, and thatIP/C/M/37/Add.1
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such complaints could raise conflicts with different agreements of the WTO.  He hoped that the
Council would have more time to discuss  this issue in the future.
273. The representative of Columbia, speaking on behalf of the Andean Community, recalled that
the discussion on non-violation and situation complaints in the TRIPS Council went back to 1999.
Since then, a number of WTO Members had presented their communications on this issue.  Theapplication of non-violation and situation complaints within the framework of the TRIPS Agreement
did cause a great deal of concern.  Members ran the risk of creating an imbalance between rights and
obligations of producers and users of technological knowledge, which could result in the creation of
new obligations.  The application of non-violation and situation complaints would limit the
technological and innovative capacity of countries.  It would also make it difficult for national
authorities to implement policies and measures in  their economic, social, health, environment and
cultural areas, which were not directly related to IPRs, and affect their enjoyment of the rights andlimit the flexibilities contained in the TRIPS Agreement.
274.  He was also concerned about the criteria on the modalities and scope of non-violation and
situation complaints, which could affect the implementation of the TRIPS Agreement.  The Andean
Community insisted that the concept of non-violation and situation complaints, which was developed
under GATT 1947, was foreign to the TRIPS Agreement.  To date, WTO Members had only resortedto these types of complaints in a limited number of cases.  These types of complaints had been drawn
up to remedy situations which had not been provided for by GATT at that time, such as internal
subsidies to goods.  Therefore, it was difficult to justify their application within the current WTO
system, and more particularly, within the framework of the TRIPS Agreement.  It was not necessary
and went contrary to the interests of WTO Members.
275. The representative of Canada said that the communication introduced by Peru along with the
Secretariat's summary note had given the TRIPS Council an overall sense of the range and complexity
of the issues involved in this discussion.  Her delegation had fully supported the mandated
examination of the scope and modalities involved in  allowing these types of complaints to be brought
forth in matters involving IPRs in the TRIPS Council.  From the beginning of this examination, herdelegation had expressed the concern that transplanting these types of remedies into the TRIPS
environment would introduce unsettling measures of uncertainty.  Over the years, many other
Members had echoed her delegation's concerns.  The Council had collectively generated a body of
analysis which had set out in detail why the TRIPS Agreement should be treated differently from the
other WTO agreements in respect of these provisions.  While not all Members might agree on every
specific issue, many of them agreed in principle that the uncertainty created by the pursuit of this
exceptional remedy in the TRIPS setting was unsettling.  Nevertheless, the Council had theresponsibility to provide a recommendation on this issue to the fifth Ministerial Conference.  The
paper introduced by Peru suggested that the TRIPS Council recommend that non-violation and
situation complaints be determined to be inapp licable to the TRIPS Agreement.  She said that
although her delegation was still reviewing this paper, it supported many points raised in it.  Adequate
time was needed to discuss this issue in advance of the fifth Ministerial Conference.  She supportedthe Chairman's suggestion to have a substantive discussion on this issue in January 2003.
276. The representative of Hong Kong, China said that, while his delegation was not a co-sponsor
the paper introduced by Peru, it supported the proposal in its paragraph 56 that the Council should
recommend to the fifth Ministerial Conference that non-violation and situation complaints be
determined inapplicable to the TRIPS Agreement.  The paper had set out quite detailed arguments to
support this proposal.  Article 1 of the Agreement provided that Members should not be obliged to
implement in their laws more extensive protection than was required by this Agreement, provided that
such protection did not contravene the provisions of this Agreement.  Members were also free to
determine the appropriate method of implementing th e provisions within their own legal systems and
practice.  He was particularly concerned about the many uncertainties involved if non-violation andsituation complaints were made applicable to the TRIPS Agreement and the potentially onerousIP/C/M/37/Add.1
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burden on a Member defending non-violation and situation complaints.  Moreover, he said that it was
unclear why the existing framework of the TRIPS Agreement was insufficient and how a non-
violation remedy could help to promote the purpose and intent of the TRIPS Agreement.
277. The representative of the European Communities said that the paper presented by Peru was a
valuable contribution to the debate that involved complex technical, legal and systemic questions.  He
agreed that there was a need to come to a conclusi on on this issue by the fifth Ministerial Conference.
He concurred with Canada that, in view of the deadline, it would be more appropriate to postpone the
further examination of this issue until January 2003.  His delegation needed some time to examine
Peru's paper and would certainly come back to it at a later stage.
278. As one of the co-sponsors of the paper presented by Peru, the representative of Brazil said
that his delegation fully subscribed to the elements presented in the Peruvian intervention.  Non-
violation and situation complaints could be more properly understood in the context of GATT 1947,when a number of important areas of international trade, such as technical barriers to trade, sanitary
and phytosanitary measures and subsidies had not yet been codified.  The evolution of the multilateral
trading system, however, demonstrated that non-viol ation complaints had seldom been raised in the
dispute settlement mechanism when they had been more appropriately addressed in the context of
trade in goods.  In light of the sui generis  nature of the TRIPS Agreement, he believed that the
application of non-violation and situation complaints to the TRIPS Agreement could raise a number
of systemic concerns, regarding the creation of legal uncertainty and the possibility of upsetting the
balance of all WTO agreements.  Of particular concern was the possibility that non-violation
measures might undermine, in the context of the TRIPS Agreement, the regulatory authority of
Members, thus affecting important areas of public interest, such as public health and nutrition.  Hebelieved that a recommendation by the TRIPS Council to ensure that non-violation and situation
complaints were not going to apply to the TRI PS Agreement would be the most coherent way of
addressing this matter.
279. The representative of India associated his delegation with the statement made by Peru, and
requested the Secretariat to indicate India as one of its co-sponsors.
280. The representative of Argentina said that, as one of the co-sponsors of Peru's paper, his
delegation shared the views expressed by Peru.  N on-violation and situation complaints were inherent
to agreements where there was an exchange of concessions and where the parties reciprocally
assumed obligations which were directly linked to market access.  In that context, concessions agreed
to in the case of GATT 1994 could be nullified or impaired by non-tariff measures.  However, the
TRIPS Agreement was not one of those market access agreements.  The typical effect of intellectual
property rights was to avoid having third parties enter the market or engage in trade without theconsent of the IP right holder.  Furthermore, market access issues concerned products and not rights.
In respect of an agreement which contained rules and disciplines and where there was an agreement to
observe such rules and disciplines, it was not possible to nullify a benefit without committing an
infringement of the rule agreed to.  In respect of this type of agreement, such as the TRIPS
Agreement, there could be no nullification if there was no violation or infringement.  The possibilityof a non-violation or situation complaint in a situ ation where there was no violation would give rise to
uncertainty as to the legality of governmental meas ures which a Member might legitimately adopt.  It
would also open up the possibility of such measures, even when they were legal and legitimate, being
called into questions by other Members.  Furthermore, non-violation and situation complaints would
upset the balance of rights and obligations which existed under the TRIPS Agreement.  Therefore, hisdelegation supported the proposal contained in paragraph 6 of Peru's paper.
281. The representative of Malaysia said that, as a co-sponsor of Peru's paper, her delegation gave
it's support to the statement made by Peru.  Speaking on behalf of the ASEAN countries, she said that
ASEAN thanked the Secretariat for its comprehe nsive compilation of the various interventions
brought forth in the debate on scope and modalities for non-violation and situation complaints inIP/C/M/37/Add.1
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document IP/C/W/349.  The compilation highlighted the complexity of the debate in finding common
interpretations of what was meant by the benefit, nature or measures that gave rise to these types of
complaints.  She said that the fact that the TRIPS Council had not been able to engage substantively in
establishing the scope and modalities in the last six years highlighted the fact that it was a new subject
and that it was difficult to establish any concrete understanding regarding such complaints.  Theobjectives of the TRIPS Agreement, as noted in its preamble and paragraph 7, called for the
promotion of effective and adequate protection of intellectual property rights which should contribute
to technological innovation and transfer of technology and that measures and procedures to enforce IP
rights should not themselves become barriers to trade or affect public policies.  There was inherent
tension between the enforcement of intellectual property rights and ensuring that such measures and
procedures did not become barriers to international trade, and other policies that protected public
interests.  The TRIPS Agreement was a minimum standards agreement seeking to ensure a balance ofrights and obligations between the objective of promoting international trade and technological
innovation and a pursuit of public interests with the protection of private intellectual property rights.
The introduction of the notion of non-violation and situation complaints would heighten further the
tension between both sets of rights.  Any non-viol ation or situation complaints could be brought,
depending on which side one was.  Both sides might seem to have grounds for complaints.  One partycould bring a complaint of impairment of benefit due to ineffective protection in enforcement.
Equally, the other party could bring a charge or complaint that certain TRIPS-consistent measures had
failed to result in technological transfer or had impeded the implementation of public policy goals.
Any such complaint could start an unending chain of accusations and countercharges.  She said that
the TRIPS Council should avoid provisions that allowed such events to occur.  The TRIPS Agreementwas an agreement negotiated between governments for the protection of private rights.  Any non-
violation and situation complaints could technically mean that private rights could extend beyond
what had been negotiated.  This clearly should not  be the intention of non-violation and situation
complaints.  She wondered whether some measures could be subject to a non-violation case if they
brought about the highest level of protection and were consistent with the TRIPS Agreement, butcould have other effects of constraining technology transfer or deterring the achievement of public
policy objectives.  She also wondered whether it constitute a non-violation case if the government of a
Member had enacted all relevant legislation to give effect to the TRIPS Agreement and taken all
reasonable steps in enforcement but the outcome fell short of the intended impact.  She said that if
they constituted non-violation cases, the existence of non-violation and situation complaints would
bind a government to higher protection than what was stated in the TRIPS Agreement.  She said that
ASEAN shared the concerns that application of non- violation and situation complaints in intellectual
property would introduce legal uncertainties and unpredictability, as well as obligations beyond the
normal implementation of the TRIPS Agreement.  For these reasons, she said that ASEAN was of the
view that there was no justification for non-violation and situation complaints and these should not be
made applicable to the TRIPS Agreement.  Finally, her delegation urged the TRIPS Council to adopt
the recommendation in Peru's paper for the fifth Ministerial Conference.
282. The representative of Singapore associated his delegation with the remarks made by the
coordinator of the ASEAN group, Malaysia.  He said that the issue of non-violation and situation
complaints was extremely delicate and difficult.  The fact that the drafters of the TRIPS Agreement
did not feel confident enough to take them as a remedy and the fact that the TRIPS Council had spent
last five to six years trying to understand their application to the Agreement indicated the difficultyand uncertainty of applying them to the TRIPS Agreement.  He believed that, after a further study of
this issue, all Members would conclude that th e TRIPS Council should make a recommendation to the
Trade Negotiations Committee and the Ministerial Conference that non-violation and situation
complaints should not apply to the TRIPS Agreement.  He did not object further discussion, because
there could be novel ideas which might come through.  However, the application of non-violation andsituation complaints to the TRIPS Agreement was an area which might lead to a complication rather
than a solution.IP/C/M/37/Add.1
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283. The representative of Egypt, a co-sponsor of document IP/C/W/383, said that the paper raised
a number of important issues and gave detailed analysis of the various elements surrounding the
concept of non-violation and situation complaints.  The dispute settlement mechanism of the WTO
was a major contribution to the stability of the global economy.  It made the trading system more
secure, predictable and credible.  However, the use of non-violation and situation complaints wouldincrease the legal uncertainty and threaten the predictability and security that the system sought to
guarantee.  Given the special nature of the TRIPS Agreement, it was extremely difficult and
inappropriate to transpose non-violation and situation complaints to it.  Such complaints were only
proper to an agreement concerning market access and reciprocal concessions.  One of the goals of the
TRIPS Agreement was to ensure maximum flexibility in the domestic implementation of laws and
regulations.  However, applying non-violation and situation complaints in the TRIPS area might
constrain some Members' ability to introduce new socio-economic developmental, environmental andcultural measures.
284. The representative of Kenya associated his delegation with the communication presented by
Peru, and said that his delegation was in full support  of the proposal that non-violation and situation
complaints should not apply to the TRIPS Agreement.
285. The representative of Korea said that his delegation was pleased to be able to continue the
work on non-violation and situation complaints, t hough there had been a divergence of views among
Members.  He recalled that Korea had submitted a paper in the year 2000 on this topic, which had
highlighted three elements which had been considered  to be the essential requirements for a claim to
be remedied, namely measures, the benefits accruing under the TRIPS Agreement and the causality
between measures and damages.  The communicati on by Peru and other co-sponsors contributed to
enhancing Members' understanding of the issues involved and provided the TRIPS Council with good
prospectives for dealing with the issue.  The sp ecial nature of the TRIPS Agreement should be fully
taken into account in the Council's discussion.  The preamble, objectives and principles of the TRIPS
Agreement, as set out in its Articles 7 and 8, provided the Council with good guidance to reach a
proper conclusion.
286. The representative of the United States said that his delegation continued to be of the view
that it was entirely appropriate for non-violation and situation complaints to be available to all WTO
Members.  This benefit or remedy would not just be available for the United States.  He took note of
certain issues identified in Peru's paper that his delegation had just received, but had not yet been able
to go through entirely.  Therefore, he expected the TRIPS Council to return to the issues raised in it at
the next opportunity.  He agreed with the Chairman's suggestion that the Council defer this issue until
January 2003.  He hoped that the TRIPS Council could at some point resolve once and for all theavailability of non-violation and situation complaints in the TRIPS Agreement and the scope and
modalities of their application.  His delegation believed that non-violation and situation complaints
had already in fact been available and clearly provided for in the WTO Agreement.  However,
paragraph 11 of Peru's paper indicated that some Members thought that the United States believed
that non-violation and situation complaints would automatically become available at the expiration ofthe period in the Doha Declaration which tried to determine the scope and modalities.
287. The Chairman clarified that his suggestion was that the Council continue its discussion of the
matter at its November meeting.  Furthermore, he suggested that the first meeting of the Council in
2003 be set as a target date for the submission of proposals.
288. The Council so agreed.
K. ELECTRONIC COMMERCE
289. The Chairman recalled that the Secretariat had been requested at the TRIPS Council's March
meeting to update its factual background note on intellectual property and electronic commerce asIP/C/M/37/Add.1
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circulated in document IP/C/W/128 in February 1999.  He asked the Secretariat to inform the Council
on the status of the requested document.
290. A representative of the Secretariat said that he regretted that because of the shortage of staff
resources the Secretariat had not been able to update this paper in time.
L. OTHER OUTSTANDING IMPLEMENTATION ISSUES (TIRETS  93 A ND 94 A ND PROPOSAL BY
LDCS ON THEIR TRANSITION PERIOD )
291. The Chairman said that the Council had covered most of the outstanding implementation
issues under the previous agenda items and recalled that the remaining outstanding implementation
issues referred to in paragraph 13 of the Doha Decision on Implementation-Related Issues and
Concerns were the following:
- Tiret 93:  The transitional period for developing countries provided for in
Article 65.2 shall be extended.
- Proposal by Least-Developed Countries, 22 October 2001: The General
Council agrees that the transition peri od for LDCs shall be extended so long
as they retain the status of an LDC.
- Tiret 94:  Articles 7 and 8 of the TRIPS Agreement to be operationalized by
providing for transfer of technology on fair and mutually advantageous terms.
292. He said that he intended to consult with Members prior to the Council meeting in November
2002 on the way in which the Council should report to the Trade Negotiations Committee by the end
of this year.
293. The Council agreed to revert to the matter at its next meeting.
M. REVIEW OF THE APPLICATION OF THE PROVISIONS OF THE SECTION ON GEOGRAPHICAL
INDICATIONS UNDER ARTICLE 24.2
294. The Chairman recalled that, at its meeting in March 2002, the Council had urged those
Members that had not provided responses to the Checklist of Questions contained in document
IP/C/13 and Add. 1 to do so before the present m eeting, if possible.  The Secretariat had issued
airgram WTO/AIR/1756 on 26 March 2002 to remind Members of the Council's invitation to providethis information.  Since the Council's meeting in June 2002, further responses had been obtained from
Lithuania and Morocco, and circulated in Addenda 24 and 25 to document IP/C/W/117.  To date, the
Council had received responses to the Checklist from 42 Members.  These responses, except for the
four most recent ones, had been summarized in a Secretariat note contained in document IP/C/W/253.
He informed the Council that it had just received a communication from Canada providing
information on the protection of geographical indications in Canada (subsequently circulated in
document JOB(02)/119).  At the Council's last meeting, the representative of the EuropeanCommunities had indicated that the European Communities and their member States had intended to
submit questions to Australia in relation to its responses to the Checklist of Questions circulated in
document IP/C/W/117/Add.19.  The European Communities had indicated that, by means of this list
of questions, it was seeking further clarification with respect to the relevant Australian legislation, its
interpretation and application in practical terms, as well as its implementation in conformity with theprovisions in Articles 22 to 24 of the TRIPS Agreement.  Since then, the final list of these questions
had been circulated in JOB(02)/97.
295. Introducing its communication, the representative of Canada said that Canada used its regime
for certification marks under the federal Trademarks Act to fulfil its obligations under Article 22 ofIP/C/M/37/Add.1
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the TRIPS Agreement.  A certification mark was a special type of trademark used for the purpose of
distinguishing goods and services that were of a defined standard from those that were not.  The
defined standards might relate to, inter alia,  the quality of goods and services, and/or the area within
which the goods had been produced or services performed, i.e. the geographical origin of the goods
and services.  The standard was set solely by the owner of the mark.  Certification marks must beregistered under the Trademarks Act and they were subject to publication and opposition proceedings
in Canada.  The duration of protection was 15 year s and registration could be renewed every 15 years,
as was the case for regular trademarks.  The owner of the certification mark had rights to prevent
unauthorized use of the mark.  Canada's Trademarks Act included a provision which expressly
allowed for the protection of certification marks that were descriptive of the place of origin for goods
and services.
296. The use of certification marks in Canada provided several advantages.  First of all, the costs
were low.  The fee for applying to register a trademark, including a certification mark, was only
Can$150 (roughly US$100).  Certification marks had fi rst been introduced in Canada's Trademarks
Act in 1952, so this means of protection was well established.  Many other countries already used
certification marks and were familiar with the approach.  The owner of the certification mark
determined the standard to which the goods had to ad here in order to use the mark.  For example, the
standard for "Danish Blue Cheese" was that the cheese be produced in accordance with the Danish
law with respect to such production.  The owner of the certification mark had considerable leeway in
defining the standard and could make it as narrow or as broad as it wished.  Geographical names
could also be registered as certification marks, and they were not limited to names.  Certification
marks might also be registered for a given word or words, design, symbol or combination thereof,provided that the same requirements for registration of regular trademarks were met in this regard.
Her delegation had included in its communication some of its legislation, a website address for the
full law,  a few examples of other GIs that were protected and some details on how Canada dealt with
wines and spirits in its legislation.
297. The representative of Australia said that his delegation was ready to make a presentation on
the application of Article 24.2 of the TRIPS Agreement in Australia.  This presentation covered most
of the issues that had been raised by the European Communities.  However, he thought it might be a
more sensible way to submit the document in writing and circulate it in the interests of saving time.
298. The representative of the European Communities thanked the delegation of Canada for
presenting the paper which provided some very valuable information about the way Canada had
complied with or had implemented its TRIPS obligations with respect to geographical indications.  He
also appreciated the willingness of the delegation of  Australia to come up with a presentation, and the
opportunity to hear that presentation to see if it indeed contained responses to the many questions it
had raised.  This raised the question of how to proceed with this review, and he wished to hear other
delegations' proposals as to how to organize the work pertaining to the review of Article 24.2 of the
TRIPS Agreement.  This was a valuable opportunity to increase the understanding of geographical
indications.
299. He requested the Canadian delegation to provide further information on how the system of
certification marks worked.  First, as regards the principle of country of origin, he said that all
Members might agree on the principle that when a country recognized a geographical indication, the
third countries had to take at face value the fact that the geographical indication in question met the
definition of Article 22.1 of the Agreement.  His understanding was that there might be certificationtrademarks that indeed contained a GI, whereas some  other certification trademarks might not contain
a GI, because it depended on the standard.  He wondered if a Canadian right holder went for example
to Switzerland and claimed GI protection, how could the Swiss judge know whether that certification
mark contained a geographical indication or not.  His second question related to the issue of conflicts
between trademarks and GIs.  A conflict between trademarks was decided in many countries underthe rule "first in time, first in right".  It mean t in practical terms that a prior in time trademarkIP/C/M/37/Add.1
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prevailed over a later in time trademark if it  brought consumer deception.  Article 22.3 of the
Agreement, which said that "[…] a Member shall invalidate the registration  of a trademark, which
contains or consists of a geographical indication", suggested that there could be cases in which a
trademark needed to be invalidated.  In other words,  a trademark that had been registered needed to be
invalidated because it contained a geographical indication.  This was a different rule from "first intime, first in right", and he wondered how this was applied when the two subjects of intellectual
property that entered into conflict were a geographical indication which was contained in a collective
trademark or in a certification trademark and a regular trademark.  His third question covered a
generics issue that was not explicitly addressed in Canada's paper but in Canada's actual legislation.
He thought that this was a very relevant questi on because, the question of what was and what was not
a generic was a very relevant one to understand GI protection.  Paragraph 2 of Article 11.8 of the
Canadian Trademarks Act was entitled "exceptions for customary names", while paragraph 3 wasentitled "exceptions for generic names for wines".  There seemed to be two different categories:
customary names and generic names.  However, Article 24.6 of the TRIPS Agreement, which he
understood was about generics, only talked about customary terms.  He wished to have a clarification
of whether there was a difference between generics and customary names.
300. Finally, he noted that Canadian trademark law cont ained a very long list of generic names.  It
had 18 names for wines including Claret, Bordeaux, Medoc, Masala, Malaga, Chablis and Tokai and
further ones for spirits like Grappa mark, Geneva gin and Cresso.  The list implied that the Canadian
authorities had come to a determination that those names were indeed generic.  He wished to know
how they had come to that determination.  In othe r words, his delegation was interested in finding out
which kind of aspects Canadian authorities had taken into consideration when building up that list.  Inparticular, he was very interested in finding out for example how a name like Bordeaux had been
included in the list, as, according to his sources, Bordeaux had never been used in Canada except by
French producers.
301. The Council took note of the statements.
N. TECHNICAL COOPERATION AND CAPACITY -BUILDING
Annual Updates on Technical Cooperation Activities
302. The Chairman recalled that, at its meeting in June 2002, the TRIPS Council had agreed to
focus on technical cooperation at this meeting.  In preparation for this annual review, developed
country Members had once more been requested to update information on their technical and financial
cooperation activities relevant to the implementation of the TRIPS Agreement in time for this
meeting.  Other Members who had also made available technical cooperation had been encouraged to
share information on these activities if they so wished.  In addition, intergovernmental organizationsobservers to the Council as well as the WTO Secretariat had been invited to provide information.  The
Council had received information from the following developed country and other Members:  Japan;
Australia;  the Czech Republic;  Norway;  Canada;  Hong Kong, China;  and the United States.  The
resulting documentation concerning the technical cooperation activities of developed country and
other Members was being circulated in documents IP/C/W/377 and Addenda.  The Council had alsoobtained updated information from the following in tergovernmental organizations:  the IMF, OECD,
FAO, WHO, WIPO, UNCTAD and UPOV.  This information was being circulated in documents
IP/C/W/376 and Addenda.  Updated information on the WTO Secretariat's technical cooperation
activities in the TRIPS area could be found in document IP/C/W/375.   Some of the information had
been received only very recently, and most of it was,  so far, available only in its original language.
Therefore, he intended to provide an opportunity, at the Council's next meeting, for the Members of
the Council to make further comments on the information submitted for this meeting that they might
not yet have been able to study, or any further information provided before that meeting.IP/C/M/37/Add.1
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303. The representative of the United States said, introducing the US technical assistance report,
that he was pleased to report that his Gove rnment had provided over 100 programmes since
September 2001 for police, customs, judges, prosecutors and domestic industries in over 70 countries.
The format of its submission in 2002 was slightly different from its past submissions due to a
development of which he was particularly proud.  For the first time, the information on USGovernment IP technical assistance programmes was being collected and displayed on the Internet.
This database was available to the world at www.training.ipr.gov.  The database was offered free of
charge to any one with internet access.  The database had been created by the Department of State
Bureau of Economic and Business Affairs, with the full endorsement of all IP agencies.  He invited
the Secretariat and all the WTO Members to visit the website to get up-to-date information on US
Government as well as US industry programmes that were offered on intellectual property.  This
would give Members an up-to-date picture of the full range of programmes that were available toMembers.  He welcomed any expressions of interest from the Membership in any of the programmes
that were identified on the website primarily through their local embassies.
304. The Chairman urged Members that had not yet provided updated information to do so.
305. The Council took note of the statements made.
Joint Initiative
306. The Chairman recalled that the WIPO and WTO Secretariats had launched on 14 June 2001 a
Joint Initiative on Technical Cooperation for Least-Developed Countries.  Since then, the WTO
Secretariat had kept the Council informed a bout the implementation of the Joint Initiative.
307. The representative of the  Secretariat said that the Joint Initiative with WIPO had two phases:
first, the organization of two major regional events, and, second, country-specific activities.  The first
of the major regional workshops, which was for the least-developed countries in Africa and Haiti, had
been held in Dar es Salaam, Tanzania in April 2002.  The second one, which was for the least-
developed countries in the Asia and Pacific region, would be held in Bangladesh from 11 to
14 December 2002.  As regards the second phase of country-specific activities, the Secretariat had
been discussing with WIPO how to respond to the quite large number of requests that had been
received under the Joint Initiative.  The Secretariat intended to start off the process of these country-
specific activities before the end of 2002.  It hoped to have a fairly large number of these activities
during the course of 2003, and was discussing this matter with the Technical Cooperation Division of
the WTO, which was responsible for technical cooperation funds.  It had to be ensured that the
necessary country-specific activities for least-developed countries under the Joint Initiative would find
their place in the Secretariat technical cooperation plan for 2003, which was presently under
preparation.  He said that another constraint which should be taken into account was staff resources tocope with the rising level of activity in the TRIPS Council.  This was becoming a very significant
constraint affecting the Secretariat's technical cooperation activities in this area.  The number of pages
of the Council's minutes in the different years was a fair indicator of the overall intensity of activities
in the TRIPS area.  In the first four years of the TRIPS Council's operation between 1995 and 1998,
there had been between 55 and 75 pages of minutes per annum, which then had increased to 130 in1999 and to 294 in 2001.  In 2002, the number of pages already amounted to 237 by the end of the
Council's meeting in June.  However, Secretariat staff professional resources had gone from four to
five during that period.  Although some additional posts for technical cooperation had been made
available using the Programme Support Fund, the TRIPS area had not qualified for one of those.
Finally, since the Secretariat was in the process of preparing its technical cooperation plan for 2003and tried to cooperate as much as possible with the other intergovernmental organizations in this area,
he said that it would be helpful if the intergov ernmental organizations could provide in the coming
days details of the events in which they would like to participate in 2003 so that they could be
included in the technical cooperation plan.IP/C/M/37/Add.1
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308. The representative of WIPO recalled the request of the European Communities at prior
meetings following up on a communication WIPO had received from Commissioner Pascal Lamy
concerning the Joint Initiative.  Commissioner Lamy had requested that the two Organizations
associate the WHO with the implementation of the Joint Initiative.  In reply, WIPO had stated that it
had cooperated with other intergovernmental organizations, including the WHO, to achieve the goalsand objectives in its technical cooperation activities.  To this end, WIPO and the WTO had invited the
WHO to participate on the issue of IP and public health at their joint meeting held in Tanzania.  At
that meeting, the WHO had been represented by a special envoy and several regional staff stationed in
Africa.  WIPO also planned to invite the WHO to the forthcoming joint meeting in Bangladesh.  As it
usually did, WIPO would also invite the WHO to other WIPO meetings where it felt that the WHO
could make a significant contribution.
309. The representative of Zambia recognized the problems faced by the Secretariat in the light of
the high demands, but very limited resources to respond to them.  He believed that most Members
were aware of this, but he was not sure about the proper procedure to respond to the Secretariat's
resource problems.  He suggested that at the ne xt meeting the Council could consider how those
Members could assist the Secretariat in various ways, such as in terms of human resources as well as
finance.  He requested the Chairman to clarify whether this was the way to proceed.
310. The representative of Senegal thanked the representative of the Secretariat for his presentation
of the initiatives that had been taken and the meetings that had been held.  He supported the statement
made by the representative of Zambia who was not only an overall coordinator of the group of LDCs
in the WTO but also a focal point for LDCs for the TRIPS Agreement.  He realized that there were
problems, but was concerned about the lack of actio n in the Council to overcome these problems.  He
thanked the delegate of WIPO for her statement on the Joint Initiative between WIPO and the WTO
on technical assistance for LDCs.  He particularly welcomed the inclusion of the WHO into this work.
In the light of the Doha Declaration on the TRIPS Agreement and Public Health, bringing the WHO
into the Joint Initiative should no longer be on an ad hoc basis but on a more structured basis.  The
WIPO and WTO Secretariats should consider the possibility of making this more systematic, whichwould provide greater security.
311. The representative of Singapore said that the remarks regarding assistance to the Secretariat
certainly found sympathy with his delegation, and that some action should be taken on this particular
issue.  Referring to his experiences with the IP working group during the Uruguay Round, he said that
the lack of resources had been a long-time problem in the area of IP.
312. The representative of the Secretariat said that he appreciated the reactions of delegations to
what he had said earlier.  It was becoming very difficult to combine the increased emphasis on
technical cooperation that the WTO was required to have pursuant to the Doha Declaration with the
greater intensity of work in the TRIPS Council and to service the Members adequately.  He said that
some of the Council's documents were not always as early, for example, as would be desirable from
the point of view of the efficient working of the Council.  As regards action to address the problem, it
was up to the Secretariat to put forward budget proposals to the Members of the WTO.  TheSecretariat would be quite shortly putting forward budget proposals.  Then it was up to the Budget
Committee to consider those proposals and to Members to decide on what they could provide.
313. The Chairman said that the Council had made a good diagnosis of the situation, regardless of
what the procedures were that needed to be followed to address the lack of resources.  The Secretariat
needed to give good service to Members, at a time when Members were asking for ever moreinformation and more services.  Some solution would have to be found.  Members of the TRIPS
Council were also Members of the Budget Committee, which was the appropriate place for any
necessary decisions to be taken.IP/C/M/37/Add.1
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314. Responding to the delegation of Senegal, the representative of WIPO said that cooperation
between WIPO and the WHO was not on an ad hoc basis.  There was a general structure already
provided within the UN system to cooperate between the sister agencies and the UN itself.  She added
that WIPO hoped to be invited to meetings of the WHO that dealt with IPR issues.  There was going
to be a meeting between the Directors General of WIPO and the WHO, and WIPO was waiting for theWHO's reply at this point.  WIPO looked forward to a closer cooperation with other agencies on the
matters of intellectual property.
315. The Chairman invited least-developed countries to submit their requests for assistance to the
WIPO and WTO Secretariats.  He also emphasized the importance of assisting least-developed
country Members to implement the TRIPS Agreement and make best use of the intellectual property
system for their economic, social and cultural development and welfare.
316. The Council took note of the statements.
O. INFORMATION ON RELEVANT DEVELOPMENTS ELSEWHERE IN THE WTO
Dispute Settlement
317. The Chairman said that, by means of a communication dated 6 November 2000, the United
States, Ireland and the European Communities had notified to the Dispute Settlement Body that they
had reached a mutually agreed solution on all the matters raised by the United States in documentsWT/DS/82/1 and WT/DS115/1 concerning the protec tion of copyright and neighbouring rights under
Ireland's law. This communication had been circul ated as document IP/D /8/Add.1 and IP/D/12/Add.1.
General Council
318. The Chairman recalled that the TRIPS Council, at its meeting of 25-27 June 2002, had
approved a draft waiver in respect of the obligations of LDC Members under Article 70.9 of the
TRIPS Agreement until 1 January 2016, and had agreed to forward it to the General Council for
adoption.  This draft waiver had been adopted by the General Council on 8 July 2002.  The General
Council's decision had been circulated in document WT/L/478.
319. The Council took note of this information.
P. OBSERVER STATUS FOR INTERNATIONAL INTERGOVERNMENTAL ORGANIZATIONS
320. The Chairman recalled that, at the Council meeting in June 2002, he had proposed, following
consultations, that the Council grant observer status to the African Regional Intellectual Property
Office (ARIPO), the African Intellectual Propert y Organization (OAPI) and the Cooperation Council
for the Arab States of the Gulf (GCC) on an ad hoc basis, i.e. subject to review in the light of any
further guidance from the General Council on the grant of observer status to other intergovernmental
organizations.  However, at that time, not all delegations had been prepared to take a decision on the
matter.  He asked whether there had been any developments in delegations' thinking and whether theCouncil could now decide to grant ad hoc observer status to these three organizations.
321. The representative of Kenya supported the Chairman's suggestion that these three
organizations be granted observer status.
322. The representative of the European Communities said that there had not been any change in
his delegation's position.  He wondered whether the Chairman had any plans for further consultations,
given that the Council had to produce a certain report and recommendation to other bodies of the
WTO so that a decision could be taken on the issue of the observer status of international
intergovernmental organizations.IP/C/M/37/Add.1
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323. The Chairman said that if there was any change in the position of those countries that had
problems with his proposal, he would like to hear th ose changes.  If not, he took it that the Council
was in the same situation as at its  previous meeting.   In that case,  he took it that the Council was not
in a position to take a decision at this meeting.
324. The representative of Senegal said that he agreed with the delegation of Kenya in supporting
granting observer status to ARIPO, OAPI and the GCC.  As to OAPI, he once again appealed to the
delegations who had opposed consensus in the TRIPS Council to reconsider their position.  At
present, Senegal was chairing the governing body of OAPI, which was an intergovernmental
organization with 16 French-speaking country members.  The initial treaty had been adopted in 1977.
French-speaking African countries had some 40 years of experience in the application of intellectual
property systems.  The first agreement had been signed in Libreville in 1962 and, since that time,
OAPI had been the main vehicle of technical assistance given to the 16 French speaking-countries.OAPI had 133 million inhabitants, and there were 35,000 patents deposited in OAPI.  OAPI had
abundant and lengthy experience in this area which should help to tip the balance in favour of
granting observer status to it as well as to ARIPO, which was somewhat different in its management
compared to OAPI.  He said that, in its paragraph 6 statement, his delegation had been advocating the
concept of domestic market as referred to in Artic le 31(f) of the TRIPS Agreement also to cover free
trade areas and organizations that had certain types of intellectual property legislation.  This was the
case of OAPI.  He had not seen any major opposition to this element.
325. He was aware of the systemic nature of observer status in WTO.  There was a consensus in
the WTO that subsidiary bodies should deal with requests for observer status on a case-by-case basis.
It was on the basis of the requests from OAPI, ARIPO and the GCC, that the Chairman had made hisproposal which had been agreed to informally and unanimously in the Council's informal meeting
before it had come to a formal meeting for decision.  Granting observer status on an ad hoc basis to
these organizations should not in any way prejudice the systemic issue.  First of all, the Council still
had to deal with the systemic matter of observer status, and secondly a final decision needed to be
taken in the WTO.  He pleaded in favour of this consensus and once again urged any Member whocould not go along with this consensus to reconsider its position.  He placed his confidence in the
Chairman to hold further consultations so that, at th e next meeting, the Council would be able to take
a decision.
326. The representative of Zambia expressed his delegation's support the admission of the
organizations applying for observer status.  He sought a clarification by suggesting that the Chairman
put the question the other way, that is, whether there was any Member who had a problem with the
admission of the organizations referred to.
327. The representative of the European Communities expressed his delegation's full support for
what the delegation of Senegal had said, and called upon the common sense of those Members which
for systemic reasons had not yet been able to join the consensus.
328. The representative of Kenya did not believe that there was any delegation opposed to giving
ad hoc observer status to these organizations.  He said that he would appreciate it if the Chairman
could put the question in the way Zambia did so that the Council could know whether there was any
delegation that was opposed to the decision.
329. The representative of Egypt said that his delegation would like to see all those organizations
interested in attending the Council's meetings gran ted observer status, particularly when they had
relevance to the work of the Council.  However,  the Council could not reach a selective decision or
follow a selective approach to each decision on an issue of a systemic nature, which the General
Council had been seized with for quite some tim e now.  For that reason, his delegation did not see
how Members of the Council could at this meeting find a way out of that problem either by trying toIP/C/M/37/Add.1
Page 76
have different categories like ad hoc observers or special invitees or any other selective approach.
This position was shared by a number of  WTO Members and groups.
330. The Chairman said that the Council was not in a position to take a decision at the present
meeting.  He indicated that he would hold consultations prior to the next meeting with a view to
finding a solution which would be satisfactory to all delegations.
331. The Council took note of the statements made.IP/C/M/37/Add.1
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ANNEX
WRITTEN STATEMENT BY THE EUROPEAN COMMUNITIES ON ITEM D
(See paragraph 142)
• We thank Australia, Canada, Guatemala, New Zealand, Paraguay, the Philippines and
the United States for their Communication on "Extension" (Doc. IP/C/W/360).
• We would also like to thank the Chairman for its "Checklist of issues relating, to the
"extension of the protection of GIs provided for in Article 23 to products other than
wines and spirits". This delegation very much supports your efforts, Mr. Chairman, to
engage all delegations in a constructive discussion on this matter.
• Given the short time since the receipt of your note, I had prepared a full reply to the
arguments and issues raised in document IP/C/W/360. However, we plan to adhere asclosely as possible to the structure proposed in your note and we will keep our
arguments and replies on the issues of "costs" to the November scheduled as
proposed by you.
• As a preliminary, general comment, we would like to profit from this occasion to
underline that the paper tabled by Australia, the United States and other raises more
questions than it provides answers. Yet, I want to reiterate that this delegation iscommitted to discuss all issues as we have done in the past and we do not refuse to
discuss any papers. It will take me some time, I am afraid, but I hope it is worthwhile.
• First, I wanted to state that it is not true that the proponents of "extension" ask the
Members of the WTO to assume new obligations without counterbalancing
concessions as stated in recital 3 of the Communications by Australia and others. Tothe best of our knowledge, we have never stated this and we believe that all WTO
remain free to ask any concessions they may wish to demand at the appropriate time.
As a matter of fact, we would be very interested to hear what Australia and others are
having in mind, when asking counter-concessions in the field of "extension". This
raises, of course, the first question. Could Australia and the co-sponsors of that paperclarify to the membership which counter-concession they wish to receive in exchange
of agreeing to "extension"? I am sure that this is a relevant question, certainly to the
proponents of "extension".
ISSUES RELATING TO PROTECTABLE SUBJECT-MATTER
1. Imbalance in numbers
(a) Impact when it comes to GIs
• Now let me turn to the question of "imbalance in numbers" as the first item for
today's discussion and issue number 1 of the paper tabled by the Australia, the United
States and others.  That paper essentially argues that, while some Member, like the
EC, have large numbers of GIs which may benefit from "extension", other Members
don't. Yet, "extension" would impose a burden to protect those hundreds of
geographical indications without a counterbalancing benefit. I must confess the
argument looks good, but unfortunately does not correspond to reality and I will
illustrate this with two examples. Let's take the case of two WTO Members: a
medium-size country, Paraguay, and a large country, Brazil.IP/C/M/37/Add.1
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• Paraguay enacted a Law on Trademarks a nd Geographical Indications (Law 1294) on
6 August 1998. That Law already provides for "extension". In other words, the very"extension" that Paraguay opposes in the TRIPS Council is already available under its
own internal legal order. Paraguay does not have a system of registration for GIs and
has chosen to enforce GI protection by putting that protection in an IPR law that can
be invoked before domestic courts. Now, we contacted the Director of theDepartment of Intellectual Property of the Ministry of Industry of Commerce. We
inquired Mr. Gonzalez about the number of foreign right-holders that have inquired
about registering its GIs or attempted to enforce GI protection in Paraguay since the
enactment of GI protection. The answer was very clear: ZERO.  Since 1998, ZERO
foreign GIs have attempted to enforce GI protection in Paraguay.
• Let's now take the case of Brazil. Brazil protects GIs, contrary to Paraguay, protects
both foreign and domestic GIs via a registration system. Again, Brazil is a country
that already provides for "extended" protection via its Law of Industrial Property, (n.
9279) of 4 May 1996 and implementing act of 28.11.2000. We contacted
representatives of the INPI, the national authority in charge of GI registration. and,
according to the INPI, the large number of foreign GIs that have been registered and
whose burden must be shouldered by the Brazilian administration amounts to TWO. Irepeat TWO foreign geographical indications. I must however concede in something,
they are both EU geographical indications. And I must concede in something else,
there are three more applications from Europe, along with 6 Brazilian applications
(Vinhos Finos do Vale dos Vinhedos , Bento Gonçalves, Rio Grande do Sul, as well as
the Region of Cerrado de Minas Gerais  for coffee, the Queijos of Friburgo  and the
chocolates of Gramado ) and one registered Brazilian GI, which, for the illustrative
(and no publicity) purposes, " Cachaça ".
• Now, from these two examples, I get no evidence of this alleged "imbalance in
numbers". I will tell you why. The TRIPS Agreement obligations on GIs are very
limited. The TRIPS Agreement asks WTO Members to provide the " legal means to
interested parties ". (Articles 22 and 23 TRIPS). So it is up to the right-holders to go
to a certain countries and avail themselves of the type of protection provided for in
the country concerned. The TRIPS Agreement does not protect automatically
anything and does not force any WTO country to do so. When right-holders decide to
go to a third country to benefit from that protection, they do so when they (1) havethe export capacity to make the investment worthwhile, and when (2) they have an
interest. The figures show that not many GI right-holders attempt to go abroad and
avail themselves of the protection offered by the TRIPS Agreement.
(b) Imbalance in numbers and economic importance?
• Yet, There the is indeed another element which must be taken into consideration
when assessing the economic benefits of an "extended" GI protection and resultingmarket opportunities: the existing and potential trade flows regarding each individual
geographical indication. Australia and the cosponsors of that paper make the. The
opponents of extension seem to be making following equation: "the more GIs one
has, the more the benefits". This does not stand the laugh test. How can one possibly
compare the potential of trade inflows of, e.g. the United States GI " Napa Valley
wines " with the small EU GI for "Costers del Segre"? How can one compare the trade
inflows of "Basmati Rice", that, according to a recent CIPR report, previously cited
by another delegate in the room, amount to 300 million dollars and the thousands of
farmers with those of the French "Calgots de Tarragoria", which does not export
outside the EU at all? It is clear that there is a difference of reality and potential ofIP/C/M/37/Add.1
Page 79
names like " Café de Colombia " and the Italian GI " white asparagus from
Cimadolmo ". Again, I repeat, numbers don't seem to matter that much but economic
values do.
(c) Imbalance in numbers and other IPRs
• As I have mentioned before, the issue of numbers is not per se a real one in our view.
However, 1 also want to draw the attention about one clear fact. The United Statesthat denounces that the EU would benefit to a greater extent than others because it has
some 500 geographical indications and this is good enough to deny the claim for
extension.. However, we wonder whether the United States would apply the same
reasoning to other fields of intellectual property. The EU Trademark Office has so far
registered about 132,218 trademarks but, ladies and gentlemen, by May 2002, the
United States Patent Office gave the certificate, of registration 2,570,478. I repeat2,570,478. M more than two million of trademarks. The figures for patents are even
much more substantial substantially higher. Mr. Chairman, if we want to talk about
imbalance in number, I would like to ask the United States what their plans are for
trademarks. Shall we repeal the TRIPS chapter on trademarks because only they
benefit from it?
2. Registration Systems and National Treatment
• Now, before I move on to speak, once again, about the definition, I would like to
address one issue that is raised regarding the fact that the EU register for GIs onfoodstuffs does not allow the registration of foreign GI unless it is determined that a
third country has an equivalent or reciprocal system of GI protection. This, of course,begs the question as to the role of registra tion systems in general, also with respect to
the protection of foreign GIs and the issue of national treatment.
• Let me first explain how we comply in the EU with the TRIPS requirement of
offering GI protection to third country GIs. As you know, the TRIPS section on GIs
leaves total freedom to WTO Members to comply with it. Indeed, (and will read therelevant provision because some delegation seem to forget it), Article 1 of the TRIPS
Agreement states that " Members shall be free to determine the appropriate method of
implementing the provisions of this Agre ement within their own legal system and
practice ."
• Now, lets turn to the obligations of the TRIPS Agreement. Both article 22.2 and 23.1
of the TRIPS Agreement clearly state the sole obligation on WTO Members: toprovide "the legal mans for interest parties to prevent the use of a geographical
indication ".
• We have seen how, for example, Brazil provided those means via a registration
system, whereas Paraguay did not have such system but permitted that GI protection,
as implemented in its domestic law, to be invoked by foreign right-holders. The EC,
for example, provides those legal means via its Labelling foodstuff legislation
(Directive 2000/13). That legislation forbids in its Article 2.1 that
"[t]he labelling and methods used [in the marketing of foodstuffs]
must not (a) be such as could mislead the purchaser to a material
degree, particularly: (i) as to the characteristics of the foodstuff and,in particular, as to its nature, identity, properties, composition,IP/C/M/37/Add.1
Page 80
quantity, durability, origin or provenance and method of
manufacture or production"
• This Directive supplements the EC unfair competition laws and provides, to all
foreign GIs, the minimum level of protection required by Article 22 against consumerdeception. Any third country right-holder can invoke this provision before any EU
Court and avail itself of the protection that TRIPS prescribes. Incidentally, as youmay know, this has no cost whatsoever for the EC administration as all costs are
borne by the interested producer.
• This is just an example of a cost-efficient system that permits GI protection with costs
down to the bare minimum.
• Let's however talk about registration systems and the question of registration of
foreign GIs. The questions of identifying GIs and protecting GIs should be separatedand clearly distinguished. We have seen already that GI registration systems are not
required by TRIPS. Yet, many countries have opted to put them into place, this is the
case, as we have seen, for Brazil, and also that of the EU. Now, what could be the
role of registration systems with respect to GIs? When I look at the practice of WTO
Members, I would be tempted to answer that  such role is twofold: identification of
domestic GIs and, sometimes, the protection of foreign GIs.
• The EC believes that registration systems should be primarily aimed at the
identification of domestic GIs. For example, the EC registration system of EU GIs
requires applicants to provide evidence that the GI definition of article 22.1 of the
TRIPS Agreement is met. This may mean, in particular, evidence that there is a link
between the protected quality, reputation or other characteristic, is due to thegeographical origin, and that the protected name evokes that origin, including, in
some cases, "country names", if they fulfill the criteria of Article 22.1, like for any
other GI. We also ask our EU MS to verify that evidence. This specific EU procedure
is ill-adapted to foreign GIs. Let me give you an example, how can the EC verify if
"Jasmin Rice" fulfils the criteria of a GI in a country like Thailand which lies morethan 10.000 kin away?
• It seems to us that the logical conclusion is to limit the registration system to
domestic GIs and protect foreign GIs via other means, as 1 explained before, such asa Foodstuffs labelling legislation or unfair competition laws or, like Paraguay, via
general GI legislation. Brazil has decided to use their register also to protect foreignGIs, which is also a valid option that we applaud.  Chairman, they keep on saying that
the national treatment obligations of the TRIPS Agreement entitle WTO GIs to be
registered under national systems.
• Much to my surprise, I found out that th e national treatment, according to the
United States, gives rights to GIs, and apparently also to trademarks and patents.
Even more shocked I was, Mr. Chairman, when I re-read Article 3 of the TRIPS
Agreement on national treatment. This provision says that (I read it for the benefit of
certain Members that keep on not understanding it): "[e]ach Member shall accord to
the nationals of other Members treatment no less favourable than that it accords to
its own nationals ...."   Let me emphasise the word "nationals", because it is crucial.
National Treatment in the TRIPS Agreement gives rights to nationals not to GIs or
Trademarks. This is different in the GATT Agreement. There, Article III of GATTstates that "(...) internal taxes and other internal charges, and laws, regulations and
requirements affecting the internal sale, offering for sale, purchase, transportation,IP/C/M/37/Add.1
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distribution or use of products, and internal quantitative regulations requiring the
mixture, processing or use of products in specified amounts or proportions, should
not be applied to imported or domestic products so as to afford protection to domestic
production."
• That difference should not be disregarded. Those entitled to rights under TRIPS are
nationals. Under GATT those are "goods". Now, we said that they are perfectlyentitled to apply for GI registration in th e EC as some of their companies have done
regarding EU GIs.
• Yet, I am happy to report to this Council that many other countries seem to have
understood that perfectly. We have already spoken about Uruguay and Brazil, let methen now continue in the South-American continent.
• Let's start by Argentina, which enacted on January 2001 a law on GIs for agri--
foodstuffs that, curiously enough, already provides for extension. I may revert to thatcurious fact that Argentina is against "extension" whereas its national law already
provides for "extension". Now I want to focu s on Article 23 of that Law. It actually
provides that "the foreign geographical indications of agricultural and foodstuff
products may be registered when our country has concluded agreements onreciprocity in which the conditions of registrations will be established" l., This
provision is quasi-identical to the Article 12 of the relevant EC regulation that the
United States believes to be TRIPS inco mpatible. I will have to conclude that,
according to the United States, the Argentinean new law would be in breach of the
TRIPS Agreement.
• Now, let's move on to Uruguay. The Regulatory Decree 34/999 of 3 March 1999
which implements Law 17.011 on Industrial Property also has a provision, in -Article
65, that indicates that "the foreign producers, manufacturers, artisans or service
providers, as well as foreign competent public authorities, may register their foreign
geographical indications according to international treaties concluded by thisRepublic". Interestingly, the Uruguayan law already provides for the "extension".
Yet, as the Uruguayan law, under the United States approach, would be found to be in
breach of TRIPS Agreement, as far as national treatment is concerned.
• Let me also say a few words about Chile at this stage. Chile enacted, prior to the entry
into force of the TRIPS Agreement, law 18455 of 31 October 1985 establishing the
norms of production, elaboration and marketing of alcohols and vinegar. This law
protects appellations of origin but only if they are Chilean. Article 27 of that law
states that "the establishment, by the president of the Republic of (…)  appellations of
origin for wines and spirits" will concern " areas of that country ". So it seems that for
Chile we have the same problem of national treatment that the EU, Argentina andUruguay: while foreign national can apply for registration, foreign GIs cannot be
registered.
• Worthy of note is that Chile does not have yet specific legislation regarding the
recognition and protection of GIs for other products. Yet, there is a Draft Law
824-01. Article 95 of that draft law states that " Foreign GI right-holders protected in
their country of origin ( ... ) will enjoy the same protection as this law provides to
national GIs. However, this will not apply in those cases where, according tointernational conventions and treaties, there is not obligation to recognize the legal
effect to those foreign geographical indications ". No wonder then that the EC hasIP/C/M/37/Add.1
Page 82
recently concluded a bilateral treaty with Chile that provides for protection to EU GIs
in the Chilean territory.
• Now, let's move on to the Andean Community. This is a special case as the applicable
instrument covers Peru, Bolivia, Equator and Venezuela. Again, here, Decision 486
of the Andean Community contains Article 219 which provides that "regardingappellations of origin and geographical indications protected in third countries, the
competent national offices may recognize that protection, as long as this is foreseen
in a convention in which a Party is Member." Again, we are faced with an unfortunate
group of countries that, like the EU, are apparently in violation of the TRIPS
Agreement, according to the US interpretation of the TRIPS Agreement.
• Next in line is Panama, which is an special case. First, Panama already provides for
"extension", which, at this stage, is no news to this Council. Yet, the Panama law on
industrial property states, in its article 137, that "the state of Panama owns the
geographical indications" and how this fits with the idea of protecting foreign GIs.
• With respect to Costa Rica, it seems that like Brazil, foreign GIs may register in that
country, but like Brazil, they will have to pay taxes that foreign nationals will not
pay. Sounds like, following the United States argument, both Brazil and Costa Ricamay well be in violation of the TRIPS provisions on national treatment.
• Continuing our way northwards, I have to say that Nicaragua definitely joins the
group of non-TRIPS compliant countries, according to the US interpretation ofnational treatment. Law 380 on Marks and other distinctive signs states, with respect
to GIs (Article 71) that "foreign producers, manufacturers and artisans, as well as thecompetent foreign public authorities, may only register their geographical indications
when this would be foreseen in an intern ational treaty to which Nicaragua is a party,
or when in the foreign jurisdiction, Nicaraguan geographical indications would
receive an equivalent  treatment to that provided under this law".
• Honduras would also be in the same situat ion. Article 126 of the Law of industrial
property states that "foreign producers, manufacturers and artisans, as well as thecompetent foreign public authorities, may only register their geographical indications
when this would be foreseen in an convention or international treaty, or when in the
foreign country would provide reciprocity  to the nationals and residents of
Honduras".
• Much of the same can be said about El Salvador. Article 67 of Decree 868 on Marks
and other distinctive signs, establishes that "foreign producers, manufacturers and
artisans, as well as the competent foreign public authorities, may only register their
geographical indications when this would be  foreseen in an international treaty in
which El Salvador is a party, or when in the foreign country would providereciprocity  to the geographical indications of E1 Salvador."
• Now, Guatemala, one of the proponents of  the Communication, happens also to have
the same problem than itself voices out! Indeed, Guatemalan law (Decree 57-2000)on industrial property, states (Article 81) that "foreign geographical indication will be
protected according to international treaties concluded by Guatemala". Thecontradiction speaks for itself, but I will not move to Mexico without indicating that
this Law of Guatemala happens to provide for extension already. For those who want
to see it, read article 83, I have a copy of it.IP/C/M/37/Add.1
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• Finally, the Mexican law on GIs, which also provides for "extension" but, with
respect to foreign GIs, does not appear to permit their registration. Indeed, theprotection of the Mexican GI Law starts with a declaration of the Institute of
intellectual property (Article 157), where as, under Article 167 of that Law,
"geographical indications will belong to the Mexican state". This fits poorly with
protecting foreign GIs, which certainly do not belong to the State of Mexico. Yet,Mexico has concluded an agreement with the EC for the mutual protection of GIs on
spirits, which makes us think that they also  do so via international conventions, as the
EU did when concluding a bilateral agreement for the mutual protection of spirits
GIs.
• Mr. Chairman, I am tempted to now move on to the Caribbean but you will hear more
of the same. So I decided to provide one last bit of information about another
continent, so you don't get the impression that only the whole of South America andthe EC is in violation of the TRIPS Agreement, according to the United States, for not
permitting the registration of foreign GIs. This is why I want to refer to the Bangui
Agreement, that provides for IP protection in 15 African countries. Unfortunately,
Article 4 the 1999 Bangui Agreement also  provides that "foreign geographical
indications in the territories of the Member States of that organization cannot beregistered by the organization unless this is foreseen in an international convention to
which the Member States are party or by a related implementing legislation".
• I know for a fact, Mr. Chairman, that not only the EC, the South-American countries
and half of Africa understand that one can protect foreign GIs without registering
them: many other countries find themselves in this situation. The United Statesinterpretation of the principle of national treatment is at odds with the legislative
practice of a large number of Members of this Council. Not registering foreign GIs
does not mean that they cannot be protected.
• Yet, from that research, a hard fact come up very, very often. Many countries that
oppose extension, have it already at home. Why then opposing? I think this Council is
entitled to understand why.....
The role of the country of origin and principle of territoriality
• Regarding the question of territoriality, we regard this as a non-issue. In fact, we
would like to register our agreement with the views expressed by the Australian
delegation at the latest Special Session of the TRIPS Council. The principle ofterritoriality does indeed apply to the TRIPS Agreement and assumes that WTO
Members accept at face value another Member's claim that a particular term meets the
definition of GIs in their territory, including those relating to country names, for the
entitlement to the "legal means to inte rest parties" that the TRIPS obligations
imposes.  Such entitlement does not determine whether the particular GI willeventually be protected.  This would be the case of a claim for protection of the name
"telephone" for a wine GI, as the Australian delegate mentioned in the last special
session of the TRIPS Council. We want to recall that we stated this very same view at
the latest special session as set out in paragraph 63 of the meeting report.
Country Names
• Mr. Chairman, Australia, the United Stat es and other co-sponsors of Communication
IP/C/W/360, continue to attempt to make us believe that the definition is a problem.IP/C/M/37/Add.1
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They claim, in paragraph 5 of their Communication that "country names" or "fanciful
terms" may not meet the definition.
• Mr. Chairman, I am a bit puzzled. We discussed this issue at the Special session on
the "multilateral system of notification and registration" where our position, that I
will now repeat, was reflected in paragraph 63 of the Meeting report. I did not hear asingle voice against the fact that "country names" are eligible under the definition of a
GI under Article 22.1 of the TRIPS Agreement. In fact, our Communication
IP/C/W/353, in paragraph 7, expressly admits "country names" as eligible for
protection. The EU has registered country names as GIs, like in the cases of
"Luxembourg ", "Svecia ".  Yet, the EU has not limited that to small countries.  So far,
the EU has not limited this protection to country names of foodstuffs GIs.  For
example, in the area of wines and spirits, the EU protects the following countrynames:  Martinique Rhum, Guadeloupe Rhum, Reunion Rhum, Guyane Rhum, Irish
Whisky, Whisky Español, Brandy Italiono, Deutscher Weinbrand (Germany Brandy),
Eau-de-vie de marc or de pommes or de poires or de kirsch or de quetsch or de
mirabelle, or de prunelles – marque national luxembourgeoise, Dansk Akvavit
(Danish Aquavit), Anís Español, Ginjinha Portuguesa, Anís Portugués.  So evencountry names of the largest EU Member States (as Germany) are protected as GIs.
There was not a disagreement that this is a matter regarding implementation, as
indicated by the Chairman of the Special Session in para. 140 of the Report of that
meeting (TN/IP/X1/2). It seems to me that raising this issue again, and again, and
again is simply a waste of time for this Council. We are happy to discuss issues ofdefinition, if there is a real problem, under the Review of Article 24.2, which happens
to even, be quoted in para. 5 of the Communication by Australia, the United States
and other. Here, the legitimate question is the following: why shouldn't this question
be discussed under the Article 24.2 Review? Why Australia insists in discussing the
definition, where there is a general agreement in this discussion? Mi. Chairman, itsimply escapes me.... We are offering a discussion on this under Article 24.2. Why
isn't this enough?
Non-geographical names as GIs
• Australia, the United States and others suggest, when speaking about "Basmati Rice",
that non-geographical names may not be eligible as a GI. On the question of
eligibility of non-geographical names, once again I reiterate our opinion, as stated in
paragraph 7 of our Communication IP/C/W/353 and paragraph 63 of the meeting
report of the Special Session of the TRIPS Council. In our view, those terms are
eligible as long as they identify a product as coming from a certain territory. As I
said, earlier this week, to me, "Jamine Rice" clearly evokes Thailand and, as far as I
am concerned, could be a GI irrespective of its non-geographical nature. The EU has
a number of those GIs, like "Vinho Verde", "Cava" and some others.
Traditional Expressions
• Mr. Chairman, Australia and others claim that the EU considers traditional
expressions as geographical indications and will claim protection for those terms viathe TRIPS Agreement. I want, once again, to reiterate our position, as stated in
paragraphs 58 and 63 of the meeting report of the last special session. "Traditionalexpressions" are NOT geographical indications. The EU is not protecting them as GIs
and therefore, under Article 24.9 of the TRIPS Agreement they are not entitled to GI
protection. This view is therefore identical to that expressed by Brazil, even byIP/C/M/37/Add.1
Page 85
Australia, in paragraphs 60 and 62. GIs are not geographical indications because they
are not protected as such and they are not entitled to protection.
WRITTEN STATEMENT BY SRI LANKA ON ITEM D
(See paragraph 168)
Like other delegations, my delegation would like to thank you for your initiative in bringing out a
checklist of issues, in order to facilitate a more focused and systematic discussion in the Council.
From the very beginning, it was our expectation that all Members approach this issue in a more
pragmatic manner rather than engage in confused and heated debate.  The deliberations need to be
more enriching and clarifying on many related issues.  Now that, Members have a checklist beforethem, we expect that all Members would be more constructive and structured in their approach.
We also expect that all Members would take into account your suggestion to avoid duplication of
work done under other agenda items of the TRIPS Council.
Mr. Chairman,
My delegation wishes to make its intervention in two parts, first outlining some points on the
differences between the general level of protection for GIs and the additional protection provided for
in Article 23 for Wines & Spirits, and second to address the two topics which you have outlined in
your informal paper.
When one compares the differences between the general level of protection provided from Article 22
and absolute or additional or enhanced protection provided for in Article 23, the following points canbe derived at:
1. The standard protection available under Article 22 approach, is protection against
commercial practices that are considered to be misleading or constitute acts of unfair
competition.  The kind of protection available under this remains limited to cases
where the public is misled by the use of a GI as to the true geographical origin of theproduct, or where such use constitutes an act of unfair competition.
2. Article 22 protection is applicable, if products are falsely presented to the public as
originating in a particular territory, in that it constitutes an act of unfair competition.
Therefore, it does not provide a sufficient intellectual protection for the benefit of the
producer entitled to use a GI.  Other producers can misuse the GI along with the
indication of the true origin of the product.  It therefore enables free riding by otherproducers to the renown of a GI.  On the other hand, Article 23 protection does not
allow the other producers to use the particular GIs in the same manner and thereby
preventing the misuse of it.
3. The requirement of the misleading test under Article 22, where important questions of
definition and scope of protection are made on an ad hoc basis, depending on national
judicial systems, creates considerable legal uncertainty.
4. As the producer, entitled to use a particular GI has to prove that the public has been
mislead and that there has been an act of unfair competition, the cost of protection ofa GI on producer is high.
5. On the other hand, Article 23 permits ex officio  action by all Members against false
indications or origin, thus reducing the cost of protection on the producer.IP/C/M/37/Add.1
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6. The protection under Article 23 has two components:
• Protection for each identified GI in the case of homonymous indications.
• The establishment of a multilateral system of notification and registration of
GIs for such identified products.
7. The absolute protection or higher level of protection, provided for under Article 23
consists of the prohibition to include expressions such as "type, style, imitation, or
like" in products that do not originate in the place indicated by the GI in question.
This level or protection is provided only for wines and spirits, at present.  This level
of protection demands the ex officio  denegation or invalidation of any trademark that
indicates a GI identifying wines and spirits.  (Article 23.1 of the TRIPS Agreement).
8. The main difference between these two levels of protection is that, in order to prevent
the incorrect use of a geographical indication under the common or ordinary
protection, the party that considers itself affected must furnish proof that the improper
use of the geographical indication is misleading the public or that it constitutes an act
of unfair competition.
It is also pertinent to mention here that the above arguments have been already presented to this
Council by a group of countries, including that of mine, in the submission, IP/C/W/247/Ref.2 made in
May 2001, and Section II of submission IP/C/W/353 made in June 2002.
Let me now come to the first topic, issues relating to protectable subject-matter.At the outset, Mr. Chairman, we believe that "extension" has no implications on the definition
provided for in Article 22.1, as the exercise we have embarked concerns the different level of
protection between GIs for Wines and Spirits and those for other products.
However, as we believe that Members in the Council need to be clear on what we are proposing,
hence we continue to engage in the discussion on this issue.
The joint submission, IP/C/W/353 presents clearly that the definition of Article 22.1 is flexible
enough as it protects geographical names of localities, regions or countries or any name to qualify as a
GI as long as it meets the following criteria:
(1) If the subject-matter is a good and it does not represent ideas or procedures and it
exists in reality.
(2) The identification by the GI correspondents to a territory of a Member or a region or
a locality of that territory.  The goods can also be identified by an indication,
therefore not necessarily the name of a geographical place on earth.
(3) There needs to be a special quality, reputation or other characteristic inherent in the
goods.
(4) The quality, reputation or other characteristics are essentially attributable to the
geographical origin of the goods.  There has to be a special link between the origin,
and the quality, reputation and special characteristics.
Accordingly, that country names that do not quality those criteria may not be eligible for protection as
GIs.  The above criteria apply to all goods, whether they receive Article 22 or 23 protection.
Article 22.1 also refers to indications that are not necessarily the names of geographical places onIP/C/M/37/Add.1
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earth, however, any indication that fulfils the above criteria may be eligible for protection as GIs.
This is because, although those GIs do not represent a true place on the earth, nevertheless the goods
have derived a reputation for their quality and special characteristics that are essentially attributable to
the place where such goods are produced or originated.
It is important to remind ourselves that what we are dealing here.  We discuss here geographical
indications, and not "traditional expressions".  These two are two different issues and distinctive
concepts.  As any delegation stated before, GIs should exist in reality and therefore GIs do not
represent "ideas" and "expressions".
My delegation also noticed that some delegations try to confuse the term GIs with other terms, such as
"indication of source" and "appellation of origin". We understand their confusions, as both these
concepts are linked to the idea of GIs.
What is an "indication of source"
The term "indication of source" as described in both, the Paris Convention and the Madrid
Agreement, means any expression or sign used to indicate that a product or a service  originates in a
country, region or specific place.
"Indication of Source" is more generic, simple and broad concept, which corresponds to the origin of
a product. This concept includes both GIs and Appellation of origins.  It refers to the designation of
any country or place situated therein, from where the product originates. It only indicates a
geographical region or a place and does not imply any special quality or characteristics of the product
on which an indication of source is used.
This concept therefore does not require that the product own a certain quality or a reputation or
characteristics or natural and human conditions linked to its geographical origin. In that sense,
Indications of Source cover country names and names of geographical regions.
What is "appellation of origin"
The term "appellation of origin", as defined in Article 2 of the Lisbon Agreement, means the
geographical name of a country, region or specific place, which serves to identify  a product
originating therein and whose characteristics and qualities are due exclusively or essentially to the
geographical environment, including both natural and human factors. The geographical names
identifying "appellation of origins"  indicate that a product originates in a specific geographical
region, only when the characteristic qualities of the product are due to the geographical environment,
including natural and human factors.
"Appellation of origin"  is more specific and a very narrow concept, which is limited and linked to the
quality and characteristics, belonging to a particular geographical environment, where the products
originates from. The factors both natural (soil and climate) and human form and influence the special
quality and characteristics of the product. Those special qualities and characteristics of the product
should be exclusively due to their geographical environment.
The names identifying "appellation of origin" should necessarily correspond to the geographical name
of a country, region or a locality and should also be linked to the quality or characteristics that are
essentially attributable to the place of origin. In that sense, "Appellation of origins" only relates to
geographical names and not to symbols or signs or other kind of expressions which serve to designate
a product.
Compared to "indications of source" and "appellation of origins", the term "appellation of origin, as
defined in Article 2 of the Lisbon Agreement, m eans the geographical name of a country, region orIP/C/M/37/Add.1
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specific place, which serves to identify a product  originating therein and whose characteristics and
qualities are due exclusively or essentially to the geographical environment, including both natural
and human factors.
The term "GI" is relatively a new concept.  The term GI is the TRIPS Agreement includes
"appellation of origin" but does not cover the "indications of source".  Accordingly, the definition ofthe TRIPS Agreement differs in a number of ways from the terms "indication of source" and
"appellation of origin".  The term GI is not as narrow as "appellation of origins", but not as wide as
"indications of source".
Under TRIPS Agreement a GI, to be protected, has to be an indication, such as symbols or signs that
points out to a given country or a region or a locality, but not necessarily the name of a geographical
place on earth. The indication has to identify a good as originating in the territory of a Member or a
region or a locality of that territory. Therefore the definition provided for in Article 22 expands theLisbon Agreement concept of "appellation of origins" to protect goods, which derive a reputation
from their place of origin, provided that reputation is essentially attributable to the quality or other
characteristics of the place of origin.
It could be notice that a number of bilateral and plurilateral agreements, entered between countries
before the TRIPS Agreement came into effect and in  few cases, even after it cam into force, were
based on the concept of "appellation of origins", thereby building on commitments to provide a higher
level of protection than that obliged by the TRI PS Agreement. Those agreements entered outside the
framework of TRIPS Agreement provided mutual concessions and benefits to the parties involved.
These concessions and benefits came in different forms. Some related to removing various forms of
barriers to trade bilaterally thereby providing greater market access for products that are being tradedamong them.
Hence, my delegation strongly believes that reference to bilateral and plurilateral agreements in the
TRIPS Council does not do any good to the process, rather it creates confusions among the
membership. What the TRIPS Council is mandated to do is to clarify the issues relating to the
implementation of the commitments and obligations  provided for in the TRIPS Agreement.  Any
Member who is interested in understanding these concepts further can refer to background material
prepared by WIPO in April 2002 contained in Document SCT/8/4.
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