A way the TRIPS PLUS ULTRA proposal could help properly address technology transfer
If the TRIPS PLUS ULTRA proposal were implemented, the system itself could generate real technology transfer, based on the principle of no discrimination among imported and locally produced products and the proportionality that the TRIPS PLUS ULTRA proposal entails. This is why the TRIPS PLUS ULTRA proposal would make international positions flip from one side to the other. From a principle that is typically aligned to developed countries, a benefit for developing countries could emerge.
NOTE: For the TRIPS PLUS ULTRA system to function optimally and for this solution to the technological transfer issue to properly work, national exhaustion of rights and proper customs controls would have to be implemented (which would allow for price discrimination). This is yet another example of how a position usually aligned with developed countries (national exhaustion) could be very advantageous for the developing countries, if the TRIPS PLUS ULTRA proposal were implemented.
- The status quo (the TRIPS Agreement).
The TRIPS Agreement establishes the principle of non-discrimination between products imported into or produced in the country where the patent is granted. This provision, which is part of the center core or heart of patents worldwide, was severely criticized in its time. Some people still find this principle pernicious. The result of the application of this provision is contrary to the goal of technology transfer, some argue. Nevertheless, it is consistent with free trade promoted by the WTO. Technology transfer, which is a TRIPS principle, has consistently up until now been merely declaratory objective in the TRIPS Agreement.
2. TRIPS PLUS ULTRA could change this.
As argued here there is a way “that these two goals or principles (technology transfer and non-discrimination among imported and locally produced products), while applying the proposal [of his] study , can stop being in opposition and even complement each other. Under the non-discrimination principle among imported and locally produced products, exportations to supply the global market could be done from any country. [M]ultinational companies will probably be attracted to the poorest countries in order to exploit in an early fashion the inventions of their competition and gradually export from there as the patent gradually expires in the rest of the world. So in the hypothetical scheme proposed in this book—namely that a patent will have different periods taking on account the economic condition of each country—these two principles could act together in a positive way.” (Taken from “A global solution for the protection of inventions”, pp. 62)
“With the introduction of justice into the current system through different protection periods on account of the economical capacity of each country, the transfer of technology could stop being subject to the charity of the technological owner alone. This has rarely happened and rarely will. With the proposed system, the period of protection in the poorest countries will be shorter, so free competition could encourage local as well as multinational enterprises to set up factories in these countries. It can be expected that this could be appealing enough for companies from anywhere in the world and for local entrepreneurs. Moreover, in the place where an intellectual activity occurs, it is effectively transferred, thus ensuring that the disclosure meets its real goal—positive impact on the body of knowledge for mankind. Under this hypothetical scenario, the global free market itself could attract industries to these countries in which in an advance manner new inventions could be exploited freely. Thus, this is an additional positive effect from the introduction in the current patent system of a variable term of protection, considering the different economic capacity of countries. Technology transfer could result of proportionality.[1]” (Taken from “A global solution for the protection of inventions”, pp. 98-99)
“On this scenario, all competitors in a given industry could be interested in having their presence in the poorest countries (beyond certain political difficulties that can afflict some of these countries), as they could be able to advance efforts to produce technology released earlier in these countries. Eventually they could export to the rest of the world, waiting for the gradual release of the patent worldwide. Everyone could produce freely (only in that particular market) the new advancements of humankind, thus supplying that market first and then exporting from it to other countries when the patent term has expired. This way free global market could help developing countries develop. Thus, the proposal contained in this study could help to establish a real technology transfer system, thus fulfilling a basic objective of the patent system. This should be analyzed and proven from an economical perspective. If this proposal comes to be implemented—in order for it to work optimally—a territorial (as opposed to international) exhaustion system should be established as the global standard […]” (Taken from “A global solution for the protection of inventions”, pp. 99/100)
“[1] The discontent with the system of protection of inventions has even gone to the point that Thurow has asserted that the path to development is in disrespecting intellectual property rights. ‘Yet copying to catch up is the only way to catch up. Every country that has caught up has done it by copying. Third World countries know that unless they can acquire the necessary knowledge, they will never make it into the First World. They cannot afford to buy what they need –even if those who have the knowledge were willing to sell, and they are not. So they have to copy’ (Thurow 1997, 284).” With TRIPS PLUS ULTRA this could change.