India’s negotiations for a new Free Trade Agreement (FTA) with the UK has been the talk of the town for a better part of 2022. From the widely popularized Diwali deadline, agreed by Prime Minister (s) Modi and Johnson, to the controversial comments by the UK Home Secretary Braverman on Indians overstaying their visas, the FTA negotiations have constantly been in the news. However, in the surrounding talk of progress and supposed benefits of the FTA, coverage of contentious issues between the economies has taken a back seat. Recently, the British Secretary of State for Foreign Trade Greg Hands was quoted saying that “We remain clear that we are working towards the best deal that is beneficial to both sides and won’t sign until we have a deal that is fair, reciprocal…” However, a glimpse at the leaked draft IP chapter of the agreement, tells us that it’s anything but “fair and reciprocal”.
Note: The leaked text was made available on bilaterals.org and is dated April 2022 thus it must have undergone subsequent rounds of negotiations. Furthermore, considering that there are no markups, it cannot be ascertained as to which provisions have been proposed/contested by the UK and which ones have been proposed/contested by India.
TRIPS Plus Terms with the potential to revamp the Indian IP system
The leaked IP text contains provisions that are the antithesis of India’s IP regime and categorically targets the provisions which differentiate it from the rest of the world. Below, I’ve summarised my understanding of a few examples of this from the leaked text, along with the relevant text, which will specifically hinder the functioning of the Indian patent law regime are:-
- Eliminate Section 3(d) – Article E.2. 2: In implementing paragraph 1, each Party shall treat any new medical use for a known substance or composition as capable of being a patentable invention. Neither Party shall require that a new medical use or a new medical form for a known substance or composition must enhance the known efficacy of that substance or composition in order to be treated as a patentable invention.
- Remove Pre-grant oppositions: Article E.10 – Where a Party provides proceedings that allow a third party to oppose the grant of a patent, the Party shall not make such proceedings available before the grant of the patent.
- Removal of Patent Working Disclosure Requirement: Article E.11- 1. Neither Party shall require a patent owner to provide periodic disclosures of information concerning the working of a patent; 2. Notwithstanding paragraph 1, a Party may require a patent owner to provide disclosure concerning the working of a patent in the context of an active application for a compulsory license, in accordance with its law.
- Patent Term Extensions: Article E.12- 2. Each Party shall provide an adequate and effective mechanism to compensate the patent owner for the reduction in the effective patent term resulting from that marketing approval procedure, through either: a. a period of additional sui generis protection conferring the rights conferred by the patent; or b. an extension of the patent term.
Apart from the above, there are other provisions that undermine the legitimacy of the balance that the Indian IP setup aims to establish. Instances of this are:-
- Introducing Marketing Exclusivity: Article F2.1: If a Party requires, as a condition for granting marketing approval for a new pharmaceutical product, the submission of undisclosed test or other data, that Party shall not permit third parties, without the consent of the person that previously submitted that information, to place on the market the same or a similar product on the basis of: a. that information; or b. the marketing approval granted to the person that submitted that information for at least six years from the date of marketing approval of the previously approved pharmaceutical product; such date to be determined in accordance with each Party’s law.
- A separate section on Trade Secrets: Section I.
- Narrowing the scope of protection under Geographical Indications and missing out on manufactured and natural goods: Article D.1 – This Section applies to the recognition and protection of geographical indications in the territories of the Parties for wines, and spirits. Agricultural products and foodstuffs.
- Eliminating doctrine of exhaustion of copyright: Article H.6 : [Each Party shall provide, for the benefit of the author of an original work of graphic or plastic art, a resale right, to be defined as an inalienable right, which cannot be waived, even in advance. to receive a royalty based on the sale price obtained for any resale of the work, subsequent to the first transfer of the work by the author.
- Increasing Copyright Term to 70 years.
- Increasing Design Protection Term to 25 years.
The number of maximalist TRIPS plus norms present in the text makes one wonder if this is a serious attempt at negotiating in the first place! Jokes aside, the Indian IP regime has established a very unique place for itself among its counterparts, and it would be very disappointing if it turns out that the Indian position is willing to even consider all of these attempts at norm shifting. As earlier explained by Prof Basheer and Prof. Pai “While India will continue to draw on foreign precedent from jurisdictions that have had a longer and more sophisticated history with intellectual property, it will not blindly adopt their norms. Rather it will seek to adapt them to the local conditions in a bid to promote and protect the national interest.”
A cursory look at the evolution of India’s IP jurisprudence will evidence the contribution of flexibilities like Section 3(d), Pre-grants oppositions, lack of data exclusivity, limited-term of the patent, the requirement to disclose working of patent, in assuring a robust setting which has not only ensured access to cheaper medicines but has also assisted in setting up India’s image as the hub for generic medicines. Leaving the human rights considerations aside especially since FTAs are generally negotiated on the understanding to improve the economy of both the Members, agreeing to these provisions can not be good for the business of the Indian pharma industries, especially when the UK doesn’t seem to offer anything solid like a strong commitment to tech transfer, etc.
Are TRIPS plus terms beneficial for the parties?
This text should not be a surprise to those familiar with the history of trade agreement negotiations, where the interests of the Global South have largely been sidelined in the pretext of a chair at the high table. This happened during the Uruguay Rounds of negotiations on GATT via which IP was brought into the ambit of the negotiations for multilateral trade agreements. And has happened multiple times in the past when developing economies have been forced to agree to TRIPS-plus provisions under different FTAs.
The actual benefits of agreeing to these TRIPS-plus terms for the IP importing Member, which is often a developing one, is debatable. However, there is a plethora of evidence to suggest the ill impacts of these terms on developing participants. For instance, in this piece, Rohit Malpani, speaking specifically about the TRIPS-plus provisions agreed by Jordan in its FTA with the US, has highlighted how the prices of medicines have increased significantly in Jordan since the FTA partly as owing to the TRIPS-plus rules. Whereas no evidence was found to support the claims that the FTA has facilitated investments in Jordan (see here and here (note the second source is paywalled)). In fact, Beatrice Lindstrom argues that these terms are not beneficial for Developed countries as well, since it only serves the interest of a handful and may force their counterparts to walk away from the negotiations and thus lose on potential market access.
What is surprising is that this TRIPS plus text, which largely undermines the flexibilities guaranteed by TRIPS, was put up on the negotiating table of which India is a part. The same India which just recently pushed for an almost complete waiver from IP enforcement for the prevention and treatment of COVID-19 highlights how provisions under TRIPS are an impingement to ensuring necessary access and how its prescribed flexibilities are just not good enough.
While it looks (and one can seriously hope) like this text is still under discussion with India pushing against these terms, this leaked text also highlights the opacity of the information on what is actually negotiated. Transparency is an essential facet, especially in negotiations around issues that have widespread ramifications. The UK for instance has put out a detailed report on its negotiating strategy, where it has highlighted how it will push for a pro-IP stance in its agreement with India, another report on the scrutiny of the UK Government’s negotiating objectives along with a questionnaire for the general public to highlight their issues and interests in the negotiations. Whereas in India apart from a call for inputs for stakeholders dated June 2021, there is hardly any official detailed update/ invitation barring a few sparsely detailed press releases (for instance see here).