World Trade Organization TRIPS waiver to tackle coronavirus

AT A GLANCE

EPRS | European Parliamentary Research Service

Author: Jana Titievskaia; Graphic: Samy Chahri, Members' Research Service

PE 690.649 – September 2021

World Trade Organization TRIPS waiver

to tackle coronavirus

The coronavirus pandemic has rekindled the global debate on whether the multilateral trade regime for

intellectual property rights (IPR) protection limits access to essential medical products. Despite embedded

flexibilities in the World Trade Organization (WTO) Agreement on Trade-related Intellectual Property Rights

(TRIPS), India and South Africa, co-sponsored by a large number of developing countries, submitted an initial

proposal for a temporary waiver in response to Covid-19 in October 2020, followed by a revised proposal in May

2021, which continues to divide opinion. The US administration voiced its support for a vaccines waiver. EU

leaders indicated an openness to discussion, while putting forward an alternative plan with a focus on limiting

export restrictions, compulsory licensing and using the existing TRIPS flexibilities.

Background

The WTO TRIPS Agreement has, since 1995, set the minimum standard of protection of, inter alia, co py right,

trademarks, geographical indications, industrial designs, and trade secrets. TRIPS also includes flexibilities

to depart from the IPR protection requirements, including in the case of a health emergency. Fo r example,

members can do

compulsory licensing, which authorises an entity to produce a patented product or

process without the consent of the patent owner. In this way, members can produce generic copies for the

domestic market (but not for export), and implement fast-track procedures in health emergencies. In

addition, the

Implementation Decision of the Doha Declaration on TRIPS and Public Health (2001) allows

producing members to adopt a compulsory licence for the production of pharmaceuticals for export. This

provision enabled Canada to make and export a generic version of a patented AIDS drug to

Rwanda, which

lacked the manufacturing capacity, in 2007-2009. However, TRIPS flexibilities have been criticised as

burdensome and legally challenging.

The WTO Agreement enables members to waive an obligation in exceptional circumstances by consensus-

based decision-making; in the past, members have successfully agreed to waive specific articles o f t he TRIPS

Agreement with respect to pharmaceutical products and least-developed countries (LDCs). In

October 2020, India and South Africa made a landmark

proposal to waive several sections of the TRIPS

Agreement, to address the prevention, containment and treatment of Covid-19. The waiver would enable

members to not grant or enforce patents (section 5) or other IP obligations on copyright (section 1),

industrial designs (section 4), and the protection of undisclosed information (section 7) related to Covid-19

products and technologies. The revised

proposal of 25 May 2021 was supported

by a number of members in Africa, Asia

and Latin America (see Figure 1), and

specified the scope would apply to

health products and technologies. These

include diagnostics, therapeutics,

vaccines, medical devices and personal

protective equipment to tackle Covid-

19. The waiver would be in force for a

minimum of three years, and be

reviewed annually. LDC members are

exempt from applying most of the TRIPS

Agreement until July 2034 or until their

graduation from the LDC category.

This is an updated edition of an 'At a glance' note published in June 2021.

Figure 1 – World map of WTO members in favour of waiver

Source: Revised proposal for TRIPS waiver (May 2021).

EPRS World Trade Organization TRIPS waiver to tackle coronavirus

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EU position

In May 2021, the Council of the EU decided to support the extension of LDCs' transitional period for the

implementation of the TRIPS Agreement by another ten years, or until the member graduates from LDC

status. With regard to the temporary TRIPS waiver, notably Germany, Portugal, Estonia and Belgium are

reportedly reserved, while Greece, France and Italy are somewhat supportive. On 4 June, the Commission

issued a communication to the WTO on TRIPS and Covid-19, reiterating the alternative proposal that

focuses on compulsory licensing, limiting export restrictions and expanding production, rather than on

waiving patent rights. On 18 June 2021, the Council adopted

conclusions on the role of IP in tackling the

Covid-19 pandemic. The Council highlighted the EU’s engagement in the WTO and its readiness to find

pragmatic approaches, such as patent pooling, licensing, and knowledge sharing platforms, and that it

stands ready to discuss other flexibilities in the TRIPS agreement.

European Parliament position

During its June I plenary session, Parliament adopted a resolution on meeting the Covid-19 challenge,

calling for support for text-based negotiations of a temporary TRIPS waiver in order to enhance global

access to Covid-19 related medical products. In the preceding plenary debate of 19 May, there was a

lack of

consensus in Parliament over the TRIPS waiver. In the same plenary session, the Parliament also adopted a

resolution on the trade-related impacts and implications of Covid-19 (rapporteur: Kathleen Van Brempt,

S&D, Belgium), urging the Commission to revisit the global framework for IPR, and open a constructive

dialogue on the TRIPS waiver in order to ensure that countries do not face retaliation over Covid-19 related

patent infringements during the pandemic.

The Parliament's resolution (of 20 May 2021) on accelerating progress and tackling inequalities towards

ending AIDS as a public health threat by 2030 also called on the EU to support the TRIPS waiver.

International developments

Third countries’ positions

Several WTO members (Australia, Japan, Norway, Singapore, South Korea, Switzerland and Taiwan) hold

reservations about starting text-based negotiations on a temporary TRIPS waiver. The Ottawa Group

including the EU, have put forward a WTO trade and health initiative, which would include trade facilitation

and liberalisation of tariffs for pharmaceutical and medical products. The USA and China have endorsed the

negotiations on the TRIPS waiver on vaccines, but have not mentioned further items of the revised proposal

such as health technologies, therapeutics or diagnostics.

Stakeholder views

The WTO TRIPS Agreement has long been criticised by humanitarian organisations for setting an overly

stringent level of IPR protection in access to medicines, notably in the context of HIV/AIDS and drug-

resistant tuberculosis. Science and research institutes have signed a

statement urging all WTO members to

endorse the TRIPS waiver proposal, including provisions on copyright. Nurses and civil society organisations

including trade unions have urged the 'TRIPS Council' to support the waiver. Proponents have argued the

TRIPS waiver could spur innovation and competition by prompting the sharing of undisclosed information,

while

critics hold that the waiver could disincentivise research and development, and set a precedent that

could in the future deter firms from investing in innovation. The American Chamber of Commerce

(

AmCham) expressed concerns that the waiver could jeopardise vaccine roll-out by diverting raw materials

and disrupting supply chains. The biotechnology industry has questioned the breadth, vagueness and

feasibility of implementing the waiver in national laws across the world.

The revised decision text of the TRIPS waiver proposal and the statement by co-sponsors were presented to the

TRIPS Council on 8-9 June 2021. The EU would need to adopt a common position in the Council of the EU in the

event it decided to support the waiver. In July 2021, WTO members also discussed the alternative EU proposal

for a global trade response for universal vaccination, i.e. limiting export restrictions, support expanding vaccine

production and facilitating the use of existing licensing flexibilities in the TRIPS agreement. The positions remain

divergent and the TRIPS waiver will likely be on the agenda of the next WTO Ministerial Conference in late 2021.