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… and it Felt Like a Kiss? EU IP Expansionism Abroad

Due to its role in the advancement of of entertainment and pharmaceutical interests within the GATT-TRIPS negotiations of the 1980s, the United States is typically assigned the role of bully in the international intellectual property sphere (for an excellent account see Drahos and Braithwaite’s “Information Feudalism”). Viewed in combination with its bilateral trade agreements, foisting stringent IP rules on smaller, poorer nations, this is somewhat understandable. But such a reading obscures the role of the European Union. Since the 1980s, key business organizations within the EU such as UNICE have functioned as a key vector for the same policy messages. In more recent times these ideas have been fully integrated into numerous aspects of institutional activity at an EU level. In what follows I will outline some developments at the level of trade policy since 2002.

The new phase was confirmed in a 2004 communication from the Commission Communication Strategy for the enforcement of intellectual property rights in third countries (hereinafter Strategy), which listed eight elements considered essential to the campaign. Several of these recall practices long established in the US. The thrust of the strategy was confirmed in a major policy document issued by DG Trade in autumn 2006, “Global Europe: Competing in the World”, regarded as signalling the relaunch of a bilateral approach to trade negotiation, and marking the dimming of the multilateral phase which in the IPR sphere produced both TRIPS and the two treaties (WCT and WPPT) at WIPO in 1996.

Pursuing the New Approach
1. Watch Lists
The first task defined in the Strategy is the identification of ‘priority countries’, analogous to the s.301 report produced annually since the 1980s by USTR, deemed the source of egregious infringements of European rightsholders.

Something of a dry run was undertaken by DG Trade in 2002. The method used in its preparation is similar to the 301 reports: information is gathered from EU delegations abroad, private companies with international activities, and trade associations. This first report published in 2003 covered 26 countries, but the results are presented without ordering them in any type of hierarchy.

Both the Strategy and the Global Europe documents were published subsequently, and provide direction for the report’s later iterations.

Thus the second edition, issued in 2006, provides a summary of the situation in forty counties. Of these, thirteen are singled for attention and divided into three categories of prioritisation. Top of the list, and in a category of its own: China. Russia, Ukraine, Chile and Turkey formed category two. The last category was made up of the member states of ASEAN and Mercosur, with the addition of Korea.

In the most recent report from 2009 China remained out front as the primary offender. Turkey remained in category two where it was joined by Thailand, the Phillippines and Malaysia. In recognition of Russia and the Ukraine’s ‘progress’ they were moved down a notch to category three beside Argentina and Brazil (also observed to be improving!), Canada, India, Israel, Korea, Malaysia, USA, Vietnam.

Chile (formerly category two) was removed from the list after (i) creating an IP authority (ii) and a specialised IP unit in the police and (iii) acceding to the Patent Cooperation Treaty.

The priority watch list system place the subject states under a form of disciplinary surveillance whereby their conduct is monitored and evaluated continually. The effect is proportional to the relative size and power of the other’s economy, for example, the US couldn’t a hoot, but others who might be looking for something, like Turkey who wants eventually to accede to the EU, are likely to be influenced over time.
And where correction doesn’t achieve the desired result, there are always other options like…

2. Bilateral Free Trade Agreements (FTAs)

“It is also envisaged to make the enforcement clauses in future bilateral or bi-regional agreements more operational and to clearly define what the EU regards as the highest international standards in this area and what kind of efforts it expects from its trading partners.”
Strategy, p.4

This declaration of intent has certainly materialised. The recently signed FTA with Korea, consdiered a template for future agreements, contains a whole gamut of TRIPS- plus provisions: extension of copyright duration from 50 to 70 years; expansion of patentability; protection of pharmaceutical test data; accession to UPOV 1991; prohibition on circumvention devices; extended systems for the protection of geographical indications etc

In addition to these substantive changes to the nature and extent of IP protection, the Agreement contains no less than ten pages of enforcement provisions, ranging from requirement for criminal sanctions, damages, injunctions, destruction of infringing products, ISP liability. The deal was recently endorsed by the European Parliament.

Similar terms form part of the deal recently finalised (though not yet officially published) with Colombia and Peru, and have been proposed as part of negotiations for an FTA with India (although there one hopes they will meet more determined resistance).

Where significant concessions are made in and FTA between WTO members, the consequences are not limited to the parties directly involved. The most-favored-nation clauses (MFN) in GATT and TRIPS mean that where countries make concessions to one another, these same terms must be offered to all other member states. Effectively the MFN is a non-discrimination guarantee taken on by members. In the context of IP laws it functions as a ratchet which continuously increases the scope of the exclusive rights available.

Just to brighten up a dull post!

Kasemir Malevich, "The Knifegrinder", 1912

3. Sanctions, Technical Cooperation and ‘Political Dialogue’
The Trade Barrier Regulation is one instrument suggested as suitable for dealing with complaints from companies in the EU, a route which could lead to eventual sanctions. Whilst the EU was also a consulting participant in the US case against China at the WTO, it has not sought to deal with conflict through sanctions in general. The preferred route has been closer involvement (through FTAs and Partnership agreements) and technical cooperation or assistance programs whereby it motivates a prioritization of IP issues and lends a hand in training necessary officials (judges, police etc). As the EU targets Asia for market access it is operating IP dialogues with both the ASEAN countries (ECAP2) and China (IPR2), and technical training in Russia and the Ukraine (TAIEX program).

4. Public Awareness
Given that this phase of EU policy is less about exacting new legislative measures and is heavily focused on enforcement, the need engage in the struggle over norm-definition is even greater. The countries targeted have far less money and resources than EU states and, especially as regards policing, have their own set of priorities as to how they should be spent. Enforcement is both financially difficult and politically popular, as it effectively means using national resources to restrict national economic capacity. Consequently some marketing aims are defined…

… some will say that by enforcing the protection of
IP rights held by Community companies, third countries will not obtain any direct benefit. It would appear, on the contrary, that they are using their resources to protect the investment of foreign entities (an argument frequently raised by certain countries). To counter this reasoning, the EC must get across the message that effective enforcement of IP rights (even if these belong to third parties) is an essential tool to attract foreign investment and the transfer of technology and know-how, as well as to protect local right-holders in developing and least-developed countries who are already suffering the misappropriation of their intellectual property (2). It is a matter of good governance and international credibility, not to mention the need to comply with WTO and other international and bilateral commitments. In the mid-to-long term, it will also encourage domestic authors, inventors and investors and contribute to the development of these countries.
Strategy, p.11

Here the problem lies in the absence of compelling data supporting the claim that increased IP protection really does drive economic development.

Perhaps as a result, a recent evaluation of the Strategy suggested that more emphasis be placed on other benefits accruing from enforcement, such as increased tax revenue (though stamping out the black market), better consumer safety (through elimination of substandard/faulty imitations) and the fight against organised crime – all initiatives which enjoy greater legitimacy and acceptance amongst populations/electorates who do not regard IP enforcement as an urgent priority…

Just to brighten up a dull post!

5. Other Measures
As alway there is the evocation of greater public-private cooperation and increased use of Customs measures. The last proposal related to intra-institutional organization at the EU level, highlighting the need for better coordination. In itself this is a reflection of the mushrooming of IP related positions as the industry has been discovered and developed by functionaries in recent years. Personnel are now spread out over multiple departments: Trade, Internal Market, Enterprise, Tax/Customs, and Justice.

The Ubiquity of Enforcement Forums…
Since 2000 there is a been a massive upsurge of enforcement activity, involving the national, regional and multilateral level. International organizations previously uninvolved have been drawn in (Interpol from 2000, Europol, World Health Organization from 2006). Intreraction with those already implicated, like the World Customs Union, has deepened. WIPO has been kitted out with a specialised enforcement forum (Advisory Committee on Enforcement, established in 2002 with full EU involvement from 2006) and the TRIPS council.

Alongside these institutional moves, there has also been a high-level political campaign evidenced in the now ritual collective statements on piracy and counterfeiting from organisations like the G8 (Gleneagles, Heiligendamm) which have paved the way for initiatives such as ACTA.


Long happy to allow the US absorb the diplomatic damage for aggressive external IP policy whilst ‘benefiting” from the results (through multilateral treaties and MFN clasues), the EU has moved increasingly into the open as an aggressive force on its own. Sensitive to the fallout engendered by this policy, the Commission has been at pains to differentiate its approach from the US, repeatedly stating that it believes that bilateral deals should take into account the level of development of the other economy. Rather than the ‘jawboning’ style now synonymous with the US TR, the EU method has been the soft but relentless sell: forcing ‘assistance’ on trading partners to develop their ‘IP capacities’; refusal to change subject in ‘political dialogues’; preferential market access for other products in exchange for increased protection.

Despite the distinctions in style however, IP expansionism remains the substance and, despite rhetoric to the contrary, there is no evidence of the results being mutually beneficial to all parties involved in the IP deals. The imposition of TRIPS on lesser developed economies, at a time when they poorly grasped the costs involved, was an injustice at the time of its passage. Today’s TRIPS-plus diplomacy is a perpetuation of that wrong. Pursued nominally in the promotion of a jobs and innovation strategy for Europe, the flawed policy abroad mirrors the flawed thinking within the European Union, which continues to grip to the dogma of exclusive rights as providing the northwest passage to future prosperity. It’s time for a rethink.


March 22, 2011 - Posted by | /, copyright, enforcement, european union, geographical indications, intellectual property, law, trade

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