It has been almost two years since India filed a complaint against the E.U., with the WTO, regarding the seizure of pharmaceutical consignments that were transiting through the ports at E.U. India was joined by Brazil and other countries in that dispute against E.U. After a year of several flip-flops, India-E.U. had finally agreed to an ‘interim settlement’ in July, 2011 whereby the E.U. agreed that mere transit of pharmaceutical drugs would not constituted patent infringement unless there was a serious risk of diversion in which case the E.U. could seize the pharmaceutical drugs in question provided that they were covered by a patent in the E.U. With the Nokia judgment by the CJEU, it is now amply clear that Customs Authorities in the E.U. had themselves erred in seizing ‘in-transit’ consignments without any proof of diversion into the E.U. Image from here.
I had recently filed a Right to Information Application with the Trade Policy Division seeking information on the manner in which the Indian Government had put together its legal team and strategy to fight the dispute. The reply to this application can be accessed here and the gist of the same is reproduced below:
(i) The first question pertained to the names of the lawyers/law-firms/law-professors engaged by the Government to advise it on the dispute:
Ans. The Government had engaged the professional services of two Supreme Court lawyers and one foreign law professor to advise it on the dispute. The names and the fees charged by these lawyers are as follows:
(a) Mr. Krishnan Venugopal, Senior Advocate, Supreme Court.
Fees charged: Rs. 8.375 lakhs (Approx. US $ 16,500)
(b) Mr. Uday Nath Tiwari, Advocate, Supreme Court.
Fees charged: Rs. 2.01 lakhs (Approx. US $4,000)
(c) Professor Frederick M. Abbot, Professor of International Law at Florida University, College of Law.
Fees charged: Rs. 25.22 lakhs (Approx. US $50,000)
(ii) The second question pertained to the process adopted by the Government to select the above lawyers/law-professors:
Ans. “The Department obtained opinion about the legal aspects of the case from the Advisory Centre for WTO Law (ACWL), Geneva and Indian law firm on the panel of the Dept. of Commerce. Dept. consulted the Permanent Mission of India (PMI), Geneva in selecting the foreign expert based on the recognized expertise in the IPR matters.
From amongst the Indian law firms/advocates the Deptt. considered their expertise in handling the WTO disputes and trade law matters. After short-listing the legal experts the Dept. took the approval of the Dept. of Legal Affairs for their engagement and payment terms.”
Comment: While Prof. Abbot is definitely a renowned expert on IP and WTO law, one does wonder why the Indian Government does not engage any Indian professors to advise it on such issues. For example Professor N.S. Gopalakrishnan, CUSAT has in the past advised the government on the TRIPs & ‘data exclusivity’. I don’t see the U.S. Government engaging Indian academics and their only hope of developing an expertise in the area is if their own government decides to engage them for advisory work. I do not understand the Indian Government’s obsession with foreigners. Aren’t Indians smart enough people? Moreover, even while selecting amongst Indians, the Government has to adopt a more transparent mechanism to select Indian lawyers.
(iii) The third question pertained to copies of the legal opinions submitted by the above lawyers to the Indian government.
Ans. The Government denied us this information on grounds that it would hurt India’s economic interests. Please note that the Government has given us access to files pertaining to the 1999 Indo-E.U.-U.S. pharma trade dispute. I do not understand how these files suddenly become confidential especially when the Govt. claims that the dispute has been settled.
(iv) The fourth question pertained to the status of the dispute and as to why India was not pressing the dispute on the WTO stage.
Ans. The Government replied with the answer that they had reached an ‘interim settlement’ with the E.U., as mentioned in the beginning of the post. Are ‘interim settlements’ allowed for under WTO law? I have no clue. The politics over this dispute are slightly complicated since India is in the middle of negotiating its biggest trade Free Trade Agreement (FTA) with the E.U. If the FTA does go through, it will be one of the biggest of its kind especially since the E.U. is already India’s largest trading partner. Since the door is still open, India should push ahead with the dispute and attempt to clarify the law on seizure of ‘in-transit’ consignments before such a provision is brought to the ACTA negotiating table.
dear Prashant:
Can you put the 1999 pharma dispute papers on SpicyIP?
Freq. Anon.
Hi F.A,
THe Govt. files on the 1999 dispute were huge, so we took out only select copies, we are yet to get delivery of the photocopies but rest assured that I will try my best to put out the meaty bits.
Prashant
Thanks Prashant for sharing this interesting information. I am really shocked to see very modest fee which Indian lawyers agreed to charge in such a high profile case. It is even not a minor fraction of what medium sized law firms charge for such cases. I am not in a position to comment on technical soundness and fitness of two lawyers mentioned in this post but after all they were engaged in this case and must have been good reputation in IP and trade related matters.
Your point about engaging local academicians and law professors is quite valid but it should be subject to availability of appropriately qualified and experienced persons. A mere focus on local expertise may be harmful if we end up involving people who do not know actual nuances of intricate trade disputes. There is no doubt that Professor N.S. Gopalakrishnan is a renowned name in IP filed and he has even worked on WIPO projects etc. But let me allow to say that there is no comparison between him and Professor Frederick Abbott (it is not Abbot!). Professor Abbott is an expert in IP and international economic law which makes him a perfect choice for a WTO dispute settlement case. Those of us who know about WTO jurisprudence can appreciate the fact that a case like EU-India generic detention may involve a profound knowledge of trade law and GATT. Professor Abbott is uniquely placed to argue in favour of Indian position not only from IP perspective but also from trade and economic law perspectives. This is where, at least my limited knowledge, Professor N.S. Gopalakrishnan clearly lacks.
For me it is important to see how India is following up this matter since its so called understanding with the EU. The European Commission released its draft Border Regulation last year and I never saw an Indian response or comments on that. In the meanwhile Court of Justice issued its judgment in Philips-Nokia case which clarifies some questions about the legitimacy of Dutch-German seizures but one has to really see how diversion related safeguard measures would be incorporated in new Regulation. If the proposed Regulation is adopted without adequate safeguard against generic detention then customs authorities will continue doing it in future. Despite EU-India understanding last reported detention occurred around November 2011 so anything can be expected in future.
I am not sure about your last point on ACTA since ACTA is already adopted and signed by number of member states. So there is no question of bringing it on ACTA negotiation table! In fact border measures and seizure powers are already part of ACTA deal with the exception that ACTA border measures will not apply on patents and undisclosed information. But the possibility of EU-style seizures will remain there on the basis of trademark counterfeiting and infringements. This problem may become viral in future as it will be applicable on all ACTA states.
Hi Hasan,
Thank you for that very informative comment. Of the two Indian lawyers, I have heard that Senior Advocate K. Venugopal is a specialist in WTO law and regularly advices the govt. on its WTO dispute. I have no idea about the other gentleman. As for the professional fees being charged by the Indian lawyers, I too am surprised with the modest fees that they have charged. However, since we have not had access to the legal opinions that they have prepared it is going to be difficult to judge the costing.
As for the comparison between Prof. NSG and Prof. Abbot, I think we can agree to disagree – I have read some of Prof. NSG’s work, which is not available on the internet. Besides, other Govt. Depts. such as the DIPP and the Registrar of Copyrights regularly use his advisory services for negotiations at WIPO. India’s case at the WTO did not require any unique understanding of trade and economic law – it was a plain and simple interpretation of treaty law. In fact India’s final position was hardly a surprise and on extremely predictable lines.
Thank you for the information on the new draft E.U. draft border regulations. I hadn’t heard about them, I’ll try and dig out a copy on the internet. Would it be possible for you to share details on the latest seizure around November, 2011 – I’ve not been able to find any details on that. If necessary you can email me at preddy85[@]gmail.com.
About ACTA, as far as I’m aware India is yet to begin negotiations on the subject – or have they already started? And of course, keeping this issue burning before the WTO is going to provide some kind of wiggle room to Indian negotiators.
Regards,
Prashant
Prashant:
The Nov end/ Dec 2011 seizures were for Sildenafil. I think Mint reported it.
Freq. Anon.