WORLD TRADE  
ORGANIZATION  WT/DS408/1 
G/L/921 
IP/D/28 
19 May 2010 
 (10-2836) 
 Original:   English 
  
 
EUROPEAN UNION AND A MEMBER STATE – SEIZURE OF GENERIC DRUGS 
IN TRANSIT 
 
Request for Consultations by India
 
 
 
 The following communication, dated 11 May 2010, from the delegation of India to the delegations of the European Union and the Neth erlands, and to the Chairman of the Dispute 
Settlement Body, is circulated in acco rdance with Article 4.4 of the DSU. 
 
_______________ 
 
  My authorities have instructed me to request  consultations with the European Union (the 
"EU") and the Kingdom of the Netherlands (the "Netherlands") pursuant to Article 4 of the 
Understanding on Rules and Procedur es Governing the Settlement of Disputes, Article XXII:1 of the 
General Agreement on Tariffs and Trade 1994 (the "GATT 1994") and Article 64.1 of the Agreement 
on Trade-Related Aspects of Intellectual Property Rights (the "TRIPS Agreement"), regarding the  
repeated seizures of consignments of generic drugs  originating in India at ports and airports in the 
Netherlands on the ground of alleged infringement of patents subsisting in the Netherlands while 
these consignments were in transit to third c ountry destinations (the "measures at issue"). 
 
 Based on complaints of alleged infringement by  alleged owners of patents over the last two 
years, customs authorities in the Netherlands have  seized a substantial number of consignments of 
generic drugs  from India in transit through the Netherlands. India understands that these seizures were 
made by applying the so-called "manufact uring fiction" under which generic drugs  actually 
manufactured in India and in transit to third countri es were treated as if they had been manufactured 
in the Netherlands.  These consignments were initially detained and later, either destroyed or returned 
to India.  In a few cases, the consignments were permitted to proceed to the destination country after 
considerable delay.  Available evidence confirms  that the customs authorities seized at least 
19 consignments of generic drugs in 2008 and 2009 while in transit through the Netherlands, 16 of 
which originated in India. An illustrative list setting fo rth relevant details of some of these seizures is 
provided in the Annex to this request.  
  The measures at issue also include the reitera ted conduct and practice of  seizing generic drugs  
in transit on the ground of alleged patent infringeme nt and the following, among other, laws, rules, 
regulations, guidelines and administrative practices of  the EU and of the Netherlands but only to the 
extent that they authorise or require the seizure or destruction of drugs  in transit on the ground of 
alleged patent infringement:   (a) Council Regulation (EC) No. 1383/2003 of 22 July 2003;   (b) Commission Regulation (EC) No. 1891/2004 of 21 October 2004; 
 WT/DS408/1 
G/L/921 IP/D/28 
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   (c) Council Regulation (EEC) No 2913/92 of 12 October 1992; 
  (d) Directive 2004/48/EC of the European Parliament and of the Council of 
29 April 2004; 
  (e) Regulation (EC) No 816/2006 of the European Parliament and of the Council of 
17 May 2006; 
 
 (f) Relevant provisions of the Patents Ac t of the Kingdom of the Netherlands, 1995 
(Rijksoctrooiwet 1995 ) (the "Patents Act"), as amended, including, without limitation, 
the provisions of Chapter IV thereof, especially Articles 53 and 79, and relevant rules, regulations, guidelines and administrative practices; 
 
 (g) Relevant provisions of the Gene ral Customs Act of the Netherlands ( de Algemene 
douanewet (Adw))  (the "Customs Act"), as amende d, including, without limitation, 
Articles 5 and 11 and relevant rules, regulations, guidelines and administrative 
practices; 
  (h) Customs Manual VGEM (30.05.00 Intell ectual Property Rights, Version 3.1) 
(Douane Handboek VGEM, 30.05.00 Intellect uele eigendomsrechten, 6 April 2009, 
Versie 3.1 ) including, without limitation, the provisions of Chapter 6 and of other 
relevant Chapters; 
  (i) The Public Prosecutor' s Office Guide to Intellectual Property Fraud 20005A022 of 
1 February 2006 ( Aanwijzing intellectueleeignendomsfraude 2005A022 ) and the 
Public Prosecutor's Office Directive (2005R013); 
  (j) Relevant provisions of the Cr iminal Code of the Netherlands ( Het Nederlandse 
Wetboek van Strafrecht ) including, without limitation, the provisions of Article 337, 
and relevant rules, regul ations, guidelines and administrative practices; and 
 
 (k) Relevant provisions of the Criminal Pro cedure Code of the Neth erlands and relevant 
rules, regulations, guidelines and administrative practices. 
  This request also covers any amendments, replacements, extensions, implementing measures 
and any other related measures with respect to  the laws, rules, regulations, guidelines and 
administrative practices of the EU a nd of the Netherlands set forth above. 
  India considers that the measures at issue are, in several respects, inconsistent as such and as 
applied, with the obligations of the EU and the Netherlands under the following provisions of the 
GATT 1994 and of the TRIPS Agreement: 
 
 1. Paragraphs 2, 3, 4, 5 and 7 of Artic le V of the GATT 1994 because the measures at 
issue, inter alia , are unreasonable, discriminatory and interfere with, and impose 
unnecessary delays and restrictions on, the freedom of transit of generic drugs lawfully manufactured within, and exported from, India by the routes most 
convenient for international transit; 
  WT/DS408/1 
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 IP/D/28 
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   2. Article X of the GATT 1994, including, w ithout limitation, Article X:3, because the 
measures at issue, inter alia , are not administered in a uniform, impartial and 
reasonable manner; 
 
 3.  Article 28 read together with Artic le 2 of the TRIPS Agreement, Article 4 bis of the 
Paris Convention, 1967 and the last sentence of paragraph 6(i) of the Decision of the General Council of August 30, 2003 on the Implementation of Paragraph 6 of the 
Doha Declaration on the TRIPS Agreement and Public Health (the "August 30, 2003 
Decision") because a cumulative  reading of these provisions confirms, inter alia , that 
the rights conferred on the owner of a patent  cannot be extended to interfere with the 
freedom of transit of generic drugs  lawfully manufactured within, and exported from, 
India; 
 
 4. Articles 41 and 42 of the TRIPS Ag reement because the measures at issue, inter alia , 
create barriers to legitimate trade, permit abuse of the rights conferred on the owner 
of a patent, are unfair and inequitable, unnecessarily burdensome and complicated and create unwarranted delays; and 
 
 5. Article 31 of the TRIPS Agreement r ead together with the provisions of the 
August 30, 2003 Decision because the measures at issue, inter alia , authorise 
interference with the freedom of transit of drugs  that may be produced in, and 
exported from, India to Members of the Wo rld Trade Organization with insufficient 
or no capacity in the pharmaceutical sector that seek to obtain supplies of such 
products needed to address their public hea lth problems by making effective use of 
compulsory licensing.  
  India considers further that the measures at issue also have a serious adverse impact on the ability of developing and least-developed country  members of the World Trade Organization to 
protect public health and to provide access to medici nes for all.  Accordingly, the provisions of the 
TRIPS Agreement referred to above must be interpre ted and implemented in light of the objectives 
and principles set forth in Articles 7 and 8 of the TRIPS Agreement, the Doha Ministerial Declaration on the TRIPS Agreement and Public Health adopt ed on 14 November 2001 and in the light of 
Article 12(1) of the International Covenant on Economic, Social and Cultural Rights, which 
recognizes the right of all persons to the enjoyment of  the highest attainable standard of physical and 
mental health. 
  We reserve the right to raise additional clai ms and legal matters regarding the measures at 
issue during the course of the consultations.  
 We look forward to receiving your reply to this  request to set a mutually convenient date for 
these consultations.  WT/DS408/1 
G/L/921 IP/D/28 
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  ANNEX 
 
Seizures by Dutch Customs of Pharmaceutical Products
 
Originating in India during Transit through the Netherlands  
  1. Seizure in October 2008 at Schiphol airport (Netherlands) of a consignment of clopidogrel 
from India destined for Colombia, on the ground  of infringement of one or more patents
1 
alleged to be valid and enforceable in the Netherlands and owned or licensed by Sanofi-
Aventis. 
 2. Seizure in November 2008 at Schiphol airpor t (Netherlands) of a consignment of abacavir 
from India, purchased on behalf of UNITAID and destined for Nigeria, on the ground of 
infringement of one or more patents alleged to  be valid and enforceable in the Netherlands 
and owned or licensed by Glaxo. 
 3. Seizure in November 2008 at Schiphol airpor t (Netherlands) of a consignment of olanzapine 
from India destined for Peru, on the ground of in fringement of one or mo re patents alleged to 
be valid and enforceable in the Netherland s and owned or licensed by Eli Lilly & Co. 
 
4. Seizure in November 2008 at Schiphol airport (N etherlands) of a consignment of rivastigmine 
from India and destined for Peru on the ground of infringement of one or more patents alleged 
to be valid and enforceable in the Netherla nds and owned or licensed by Novartis AG.  
 
5. Seizure in December 2008 at Schiphol airpor t (Netherlands) of a consignment of losartan 
from India and destined for Brazil on the ground of infringement of one or more patents 
alleged to be valid and enforceable in the Neth erlands and owned or licensed by E.I. Du Pont 
de Nemours and Co. Inc., Merck & Co. Inc. and Merck Sharp & Dohme B.V.  
  
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1 In this Annex, "patents" also refers to, an d includes, supplementary protection certificates.