Frances Nwadike, Ph.D. candidate at Newcastle University Law School (UK), discusses waiver of TRIPS obligations for the transfer of Carbon Capture Technology to facilitate sharing of technology between WTO members...
In October 2020, the World Trade Organization (WTO) representatives from India and South Africa submitted a proposal for the waiver from the “implementation, application and enforcement” of certain sections of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement) in relation to prevention and treatment of COVID-19. Further to this, some countries have indicated support for this proposal, while others have made a different proposal. For example, on June 18, 2021, the European Union (EU) proposed the adoption of a “Declaration on the TRIPS Agreement and Public Health in the Circumstances of a Pandemic.” The proposals for a waiver of the obligations under the TRIPS Agreement highlight a recurring concern that the TRIPS Agreement does not facilitate technology transfer, including the transfer of climate mitigation technology.
Some scholars argue that the TRIPS Agreement promotes innovation and thus facilitates technology transfer, while others argue that the TRIPS Agreement impedes technology transfer to developing countries. However, a key fact is that developing countries are unwilling to engage with the TRIPS Agreement to facilitate technology transfer. This is illustrated by the continuous attempts by developing countries to explore alternatives to TRIPS Agreement when seeking solutions to a serious concern. For example, due to public outcry following the HIV/AIDS epidemic, WTO members adopted the “Declaration on TRIPS agreement and Public Health” to facilitate access to essential medicines. Following this, the TRIPS Agreement was amended in 2005 through a protocol and this came into force in 2017. While re-negotiation could help to amend a multilateral agreement to reflect recent interests, it could become an obstacle where a serious and time-sensitive concern exists such as climate change.
Scientific reports indicate that least developed and developing countries would be most affected by climate change impacts due to inadequate access to financial resources and relevant technology. Climate technology, such as Carbon Capture Technology (CCT), could mitigate the impact of climate change by reducing the amount of greenhouse gases in the atmosphere. CCT is particularly useful in developing countries, where reports indicate that there would be an increase in greenhouse gas emissions. The Paris Climate Agreement notes the need for such technology in least developed and developing countries and, thus, encourages signatories to facilitate technology transfer to these countries.
What does the TRIPS Agreement say about the transfer of climate technology?
The TRIPS Agreement does not refer to climate change or provide a specific definition for the term “technology transfer.” The term technology transfer can be broadly defined as the dissemination of technology from the inventor to other parties including users. It involves the dissemination of not just the physical component of the technology, but also human skills and information on the technology.
The combined reading of the provisions of Article 1, 28, and 33 of the TRIPS Agreement indicate that WTO members are required to confer exclusive patent rights on inventors for a minimum period of 20 years. This could foster the development of climate mitigation technologies (CMTs) as inventors would be reimbursed accrued financial expenses or accrue financial benefits from the use of CMTs. On the other hand, this restricts technology transfer to the sole authorization of the inventor and could frustrate efforts on the transfer of climate technology without the consent of the inventor. Although the TRIPS Agreement allows WTO members to restrict patent rights in certain instances, under Article 7, 8, 27.2, 30, and 31, these provisions are vague and difficult to enforce.
Article 7 of the TRIPS Agreement provides that “the protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and transfer of technology.” The term “should” indicates that the provision is merely hortatory and thus cannot be enforced with certainty. In addition, Article 8 of the TRIPS Agreement allows WTO members to adopt measures to protect public health, promote public interest in sectors of importance to technological development, or prevent the abuse of intellectual property rights. However, this article stipulates that the permitted measures should be consistent with the provisions of the TRIPS Agreement.
Article 27.2 of the TRIPS Agreement allows WTO members to exclude from patentability inventions to avoid serious prejudice to the environment. Similarly, Article 30 and 31 of the Agreement allow WTO members to limit patent rights and impose compulsory licenses on inventions. However, the provisions are vaguely worded and limit members’ ability to restrict patent rights or impose compulsory licenses without negotiating with the right holder.
In summary, the TRIPS Agreement facilitates the development and transfer of climate technology to the extent that it creates strong patent rights for inventors. However, it could impede technology transfer where an inventor refuses to give consent to the use of the technology. This raises an important question on whether a waiver of the obligation to protect patent rights could facilitate the transfer of technology.
Could a TRIPS waiver facilitate the transfer of climate technology?
A waiver of the obligations under the TRIPS Agreement would weaken intellectual property rights and may enable developing countries to acquire physical technology and, thus, facilitate the transfer of climate technology or its advancement in developing countries, especially in a situation where the relevant human skills and infrastructure exist. Despite how promising a waiver may be for developing countries, long-term transfer of climate mitigation technology may not be achieved through a waiver of TRIPS obligations.
There are a number of factors that would hinder climate technology transfer if the obligations under the TRIPS Agreement are waived. Firstly, a waiver of the obligations weakens intellectual property rights, particularly patent rights, and this may deprive patent right holders from reaping the financial benefits that could be incurred from licensing the use of their technology. Consequently, this could dissuade inventors from committing resources, such as financial, human, and research resources, to further develop climate technology.
Another challenge is the lengthy process required to waive trade obligations. Article IX.3(b) of the Agreement Establishing the WTO (WTO Agreement) permits WTO members to waive certain obligations. To do so, a request for a waiver must be submitted to the TRIPS council for deliberation. The council is required to deliberate on the request for a period of not more than 90 days, after which a report is produced and submitted to the Ministerial Conference (MC). The MC has the liberty to adopt the report or subject it to further deliberation. Due to the political nature of this body, negotiations could take several months and possible years before a decision is made. Furthermore, a three-fourths majority is required to grant a waiver. Currently, there are 164 WTO members, with most of the membership identifying as developing and least developed countries. A three-fourths majority could be achieved if developing and least-developed country members all vote in support of a waiver. However, voting in this way could have political or international relations implications and another approach to this would be better. Moreover, a waiver granted under Article IX.3 is not permanent as Article IX.4 of the WTO Agreement, which stipulates that a waiver should be reviewed annually if it is granted for more than a year.
A third challenge is the transfer of the knowledge behind the technology. Technology transfer is a two-way process that involves transfer from the donor country and assimilation of the technology by the recipient country. It is important for the receiving developing country to have the necessary technical knowledge or infrastructure to ensure the assimilation and further development of the technology. Therefore, close collaboration between countries is required to develop new or further advance existing CMTs. However, this may not be an obstacle in a situation where the know-how is available within the recipient and the missing requirement is the permission to use the invention.
An opportunity to amend the TRIPS Agreement
The ongoing discussion on the waiver of TRIPS obligation for COVID-19 treatment presents an opportunity to assess the effectiveness of the TRIPS Agreement in facilitating technology transfer in general, including climate technology. It is necessary to note that developing countries are unwilling to engage with the TRIPS Agreement, and a waiver of TRIPS obligation or any arrangement under it would not resolve the reoccurring issue.
Some academics argue that a declaration on the TRIPS Agreement and climate change, similar to the Declaration on TRIPS Agreement and Public Health, should be established to facilitate the transfer of climate technology. While a declaration could reconfirm members’ commitment to the transfer of technology to developing countries, it lacks the same legal force as the TRIPS Agreement and thus holds less legal weight than the TRIPS Agreement. Instead of committing resources to a temporary solution, WTO members should commit resources to negotiate and amend the TRIPS Agreement for the mutual benefit of inventors and users; that is, to facilitate the sharing of technology, including climate technology, between WTO members.
Frances Nwadike is a Ph.D. candidate at Newcastle University Law School (UK).
Suggested citation: Frances Nwadike, The Possibility of a Waiver of TRIPS Obligations for the Transfer of Carbon Capture Technology (CCT), JURIST – Academic Commentary, August 13, 2021, https://www.jurist.org/commentary/2021/08/frances-nwadike-waiver-trips-transfer-cct/.
This article was prepared for publication by Sambhav Sharma, a JURIST Staff Editor. Please direct any questions or comments to him at firstname.lastname@example.org
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