Here Again?! – The WTO COVID19 Waiver Ministerial Decision- June 2022

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In a previous piece in the Conversation and on this Blog I predicted that the final outcome of the negotiations on the TRIPS Waiver would end up with a solution based on compulsory licensing, involving changes to TRIPS Article 31bis.  I was right, but I also noted the minimum changes necessary to actually make such an Article 31bis Compulsory Licensing option effective.  The final Ministerial Decision from the WTO meeting this past week, is not that. In fact, it is so minimal that it may actually be a step backward from what was possible before the waiver.

The outcome is embodied in these two documents:

·  a Ministerial Declaration on the WTO Response to the COVID-19 Pandemic and Preparedness for Future Pandemics (WT/MIN(22)/W/13); and  

·  a Ministerial Decision on the Agreement on Trade-related Aspects of Intellectual Property Rights (WT/MIN(22)/W/15/Rev.2)

So, in what ways does it fall down? Below, I go through what was needed compared to the final text:

The fundamental structural problem with the decision is that it only addresses production for export. It does not truly address that it should BOTH emphasize production in those countries with existing capacity AND enable eligible countries to import.  The eligible countries identified to be allowed to issue compulsory licenses for export are limited to developing countries and those with existing capacity are encouraged to NOT avail themselves of this provision. This begs the question of just who will then be the producer of COVID19 vaccines. It is precisely those countries with current production capacity that we would want to expand and export to eligible importing countries.  The incoherence of the document is evident here in its failure to fully address the different rights and duties of exporting members and of importing members.  It might make sense for importing members to be limited to developing country members but NOT for exporting members, if the goal is to increase production and export to developing countries.   

A real problem is that it is limited only to compulsory licensing and does not address trade secrets in article 39.2. There is one mention of article 39.3 regarding information submitted to the government for regulatory purposes but given that know-how is a major component of replicating the mRNA vaccines, the impact of this decision will be very limited.  At least, it does recognize that governments can use any mechanism in its domestic regime, not just legislation, although implementing states may have constitutional limitations of their own.  It is also, for the moment, limited to vaccines, although extension to therapeutics and diagnostics will be considered in 6 months.

It states that there is no need to ask for authorization from the rights holder but that was already true under Article 31(b) for emergencies. This is an empty promise. The suspension of Article 31(f) on exports is also empty as long as developed countries are not required to issue.

  1. Article 31(a) –  authorization of such use shall be considered on its individual merits;
    1. What is needed – The application of this article should be suspended to allow for patents to be issued related to a product such as a vaccine, even where it involves multiple related or dependent patents. With respect to compensation, the government shall determine value based on the value of the final product and it shall be the responsibility of the patent holder to pay royalties for any dependent patents. A compulsory license can be issued to cover both the domestic and export market simultaneously.
    2. What the final text does – the Decision says nothing with respect to this issue.
  2. Article 31(b) – such use may only be permitted if, prior to such use, the proposed user has made efforts to obtain authorization from the right holder on reasonable commercial terms and conditions and that such efforts have not been successful within a reasonable period of time. This requirement may be waived by a Member in the case of a national emergency or other circumstances of extreme urgency or in cases of public non-commercial use. In situations of national emergency or other circumstances of extreme urgency, the right holder shall, nevertheless, be notified as soon as reasonably practicable. In the case of public non-commercial use, where the government or contractor, without making a patent search, knows or has demonstrable grounds to know that a valid patent is or will be used by or for the government, the right holder shall be informed promptly;
    1. What is needed – In accordance with the Doha Declaration on TRIPS and Public Health, each country shall be free to determine what constitutes a national emergency and how long it shall last but it shall, at a minimum, last to the extent to which all eligible persons in relevant countries have been immunized against COVID19.
    2. What the final text does – the text essentially restates the right not to notify in emergencies.
  3. Article 31(f) – any such use shall be authorized predominantly for the supply of the domestic market of the Member authorizing such use;
    1. What is needed – This article should be suspended to allow for the application of Article 31bis, again to the extent that the relevant elements of 31bis are suspended.
    2. What the final text does – the decision actually does allow for the suspension of this requirement, which is crucial, but this was already done by Article 31bis. It is not effective unless the procedural limitations of article 31bis in all countries are lifted so that firms in developed countries can produce for export, not just firms ion developing countries.
  4. Article 31bis2(b)(i) – only the amount necessary to meet the needs of the eligible importing Member(s) may be manufactured under the license and the entirety of this production shall be exported to the Member(s) which has notified its needs to the Council for TRIPS
    1. What is needed – This article should be suspended to allow firms that receive a compulsory license to produce as much as they can for both domestic use and for export in line with the identified needs of the relevant importing countries. Production can be aggregated to combine multiple orders from multiple countries AND firms should be able to stockpile production for future anticipated orders and needs in line.
    2. What the final text does – Provided that the Decision supplants Article 31bis, then this provision should not apply to COVID vaccine production. However, this remains unclear and if 31bis applies then the problems posed by this element of 31bis remain.
  5. Article 31bis2(b)(ii) – products produced under the license shall be clearly identified as being produced under the system through specific labelling or marking. Suppliers should distinguish such products through special packaging and/or special colouring/shaping of the products themselves, provided that such distinction is feasible and does not have a significant impact on price;
    1. What is needed – This article should be suspended and such identification should only be made available on the relevant purchase orders, regulatory documents and customs forms, which shall be made accessible to patent holders upon request.
    2. What the final text does – the Decision varies this by requiring only best efforts to prevent re-exportation.  
  6. Article 31bis2(b) (iii) before shipment begins, the licensee shall post on a website(7) the following information: the quantities being supplied to each destination as referred to in indent (i) above; and, the distinguishing features of the product(s) referred to in indent (ii) above;
    1. What is needed – This article should be suspended and the relevant information should be made available on request from customs and regulatory bodies.
    2. What the final text does – this would also likely not apply, provided Article 31bis is supplanted, but the Decision does require notification of any measures within a reasonable period to the WTO secretariat.
  7. Article 31bis(4). Members shall ensure the availability of effective legal means to prevent the importation into, and sale in, their territories of products produced under the system and diverted to their markets inconsistently with its provisions, using the means already required to be available under this Agreement. If any Member considers that such measures are proving insufficient for this purpose, the matter may be reviewed in the Council for TRIPS at the request of that Member.
    1. What is needed – This article shall remain in operation but under no circumstances shall countries apply it to extending provisional or injunctive measures prior to a final determination of the legality of the importation in the original importing or exporting member.
    2. What the final text does – The Decision reiterates that members are REQUIRED to make available legal means in their domestic law as required by TRIPS, seemingly adding obligations on those LDCs that do not actually have to apply the terms of the TRIPS Agreement under the existing extensions for implementation. Again, it is unclear whether the Decision supplants article 31bis’ requirements.
  8. Article 31(g) – authorization for such use shall be liable, subject to adequate protection of the legitimate interests of the persons so authorized, to be terminated if and when the circumstances which led to it cease to exist and are unlikely to recur. The competent authority shall have the authority to review, upon motivated request, the continued existence of these circumstances;
    1. What is needed – This article shall be suspended, so that there is certainty for any issued compulsory license and to ensure a viable economic model.
    2. What the final text does – there is a 5 year period with a possible extension.
  9. Article 31((i) – the legal validity of any decision relating to the authorization of such use shall be subject to judicial review or other independent review by a distinct higher authority in that Member;
    1. What is needed – This article shall not extend to availability of provisional or injunctive measures in either the importing or exporting countries prior to a final legal determination by that higher authority
    2. What the final text does – the Decision does not address this
  10. Article 31(j) – any decision relating to the remuneration provided in respect of such use shall be subject to judicial review or other independent review by a distinct higher authority in that Member;
    1. What is needed – This article shall not extend to availability of provisional or injunctive measures in either the importing or exporting countries prior to a final legal determination by that higher authority
    2. What the final text does – the Decision does not address the legal issue, although it does allow that humanitarian concerns may be taken into account in assessing the economic value of the license. 

More unclear and needs to be clarified is the extent to which this Decision supplants and substitutes for Article 31bis when it comes to COVID19 vaccines.  If it does, then the Decision is somewhat more effective.  The analysis above was done with that presumption. That said, the outcome is disappointing beyond belief. In a time of one of the greatest emergencies of our time, the firms and the countries and the institutions have failed to meet even the minimal threshold needed to meet the challenge. 

Cite as Dalindyebo Shabalala “Here Again?! – The WTO COVID19 Waiver Ministerial Decision – June 2022” IP& (17 June 2022)

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Published by Dalindyebo

I am an Associate Professor of Law Professor at the University of Dayton School of Law. I am engaged in Teaching, Research, Policy, Advocacy on: - Sustainability, Environment and Technology Policy at the International and Domestic Level - Implementation and Evaluation of UN Sustainable Development Goals for firms, NGO's - Technology Contracts, Licensing and Intellectual Property Business Models Advising firms, non-profits, and countries on implementation of policies relating to sustainability and environmental norms, goals and obligation, especially in relation to technology.

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