Necessary Introduction of Proportionality

For a short analysis of the question of the impact of proportionality in the justice of the global patent scheme click HERE. The following is part of an academic work taken from “A global solution for the protection of inventions“, pp. 81-107 and 121 to 130.

“For the axiological (justice) analysis of the system for the protection of inventions, it is essential to identify the objectives and principles worth being recognized and encouraged by it. It must be noted that with the universalization of rules, the objectives that must be recognized and protected should also be comprehended from a universal perspective. Indeed as said by Remiche and Desterbecq, they must set “a social contract on an international level.” (Remiche and Desterbecq 1997, 328) The principles and objectives must act consistently with each other to achieve the main objective of the system of protection for inventions and the ultimate purpose of any regulation—general welfare. Once identified, the regulations in this regard should tend to attain these objectives and seek to uphold these principles the best way that the human intellect can develop them.

This subchapter first addresses the issue related to proportionality (central proposal of this study), which is a principle that for its significance in the axiological (justice) aspect of the regulation should be applied to an eventual new scheme unequivocally. Since the central proposal of this study is an unpublished one, a detailed analysis is provided, and that determines that the proposed corrective is plausible. Then it identifies other principles and objectives that a well-conceived patent regime should recognize.

There are certain elements of the rules of the TRIPS Agreement that may be questionable from an axiological analysis (justice), which will also be identified in this subchapter. But basically any shortcomings in this regard are subsumed in one aspect—a uniform duration of the protection bestowed by all countries regardless of their economic status. There is no proportionality. Currently the term of protection granted to inventions worldwide is twenty years from the filing date of the application.

It is a contradiction that people from Canada—just to take the example of a developed country with citizens and governments with deep social conscience—with an annual income per capita of US $29,740 suffer the existence of a legal monopoly of twenty years the same way that the people of Sierra Leone will when the periods for implementations of the TRIPS Agreement comes to an end, a country with an income per capita of just US $530 (UNFPA 2005). Just by stating the above, the inadequate treatment about the regulation is revealed. By applying the obvious corrective to this situation (proportionality), other aspects for the protection of inventions may be analyzed with an axiological perspective (justice). All previous analysis will be insufficient.

All the objectives and principles that this study identifies as global principles worth promoting—except the principle of proportionality—are recognized in the objectives and principles of the TRIPS Agreement (mainly in articles 7 and 8). This encourages the possibility—if the principle of proportionality is introduced—to achieve within the TRIPS Agreement itself an adequate system of protection. The objectives that are usually identified as objectives of the industrialized countries (more harmonization, less distortion, free products movement, increased effectiveness of the rule, etc.) and the objectives of developing countries (greater technology transfer, etc.) are actually objectives of humanity as a whole (greater technological development, greater overall welfare, etc.).

With the introduction of proportionality in the TRIPS Agreement, these principles could at last meet with the desired objective, which is a greater global welfare. Remiche and Desterbecq explain how these principles and objectives stated in the TRIPS Agreement are a “community of global values.” [This] obviously can be seen in expressions such as “mutual benefit,” but also in the last sentence—referring to the declaration of principles—which refers to promote a balance of rights and obligations. These are the rights and obligations of holders of Intellectual Property Rights and—as a corollary—those of the global community. [ … ] In conclusion, the general principles (or “fundamental principles”) of the Agreement (especially the art. 7 and 8) contribute in making the WTO a community of values rather than a place of confrontation of blocks or countries. (Remiche and Desterbecq 1997, 287-288)

 

The agreement is only missing proportionality for it to be complete. The proposal outlined in these lines seeks to strengthen the harmonization of the regulation, to go into depth with the elimination of market distortions, and to encourage research and development (among other objectives) with the introduction of a fair reward system based on the principle of proportionality. In this hypothetical system any holder of a patent shall have the same term of protection worldwide as any other holder of a patent in a subscriber country regardless of their nationalities or the field of technology of the invention, which is in strict compliance with the principles of National-Treatment and Most-Favored-Nation-Treatment. But the duration of their rights will vary from country to country, according to the economic capacity of each country.

Kresalja—interpreting a proposal of the author Thurow—said that a classification according to the economic capacity of the various countries in the patent system would be advisable in terms of maintenance fees and annuities (Thurow 1997, 279). This proportionality proposed by Thurow is being applied to the international filing of patents process under the Patent Cooperation Treaty (PCT). Under this, for example, nationals from certain countries, there may be a decrease in the payment of the registration fee of 75 percent (WIPO 2012). It is an excellent initiative (commendable), but still proportionality must be applied in a more important sphere.

As it was reviewed when this study analyzed the validity effect of the TRIPS Agreement, a kind of proportionality was applied, taking into account the different economic capacity of countries in relation to the term for the implementation and application of the agreement, determining a gradual validity of the TRIPS Agreement. This (plus the above) shows the links that the principle of proportionality, accepted as a fundamental principle in the field of law in general, has so far with the patent system, which is good but still insufficient.

To structure the proportional system in terms of the duration of the rights granted to a patent, a single amendment in the text (article 33) of the TRIPS Agreement is required. While this amendment will not be as easy to crystallize as for a man to snap his fingers, it is plausible. As mentioned in the conclusion of this study, the mechanism to implement amendments is established, and the forums to discuss them are continuous. These are—in their areas of competence—the so-called rounds of negotiations (as those of Uruguay, Doha, “the millennium round,” and the upcoming Bali Ministerial Conference, among others), and also the Council for the TRIPS.

The practical implementation of the proposed amendment will require careful analysis, primarily an economical one. Because of the originality of this proposal and the fact that the economic issue is beyond the scope of analysis of this study, this issue cannot be examined too deeply. Economic parameters, such as gross domestic product of a country and the size of its market, could be suitable indicators that reflect the extent to which a country is able to contribute to the technological development of humanity. Each state, country, or economic region will grant a certain number of years of exclusivity to patent holders within their territories regardless of the nationality of the holder. An appropriate economic technical determination should be established, which this study does not venture to determine, as it is beyond the scope of its analysis. Additionally the implementation of the proposed corrective in the structures of the WTO and the Council for TRIPS (concerning authority and mechanisms) will also require extensive analysis.

The truth is that many issues and points of views could arise about this hypothetical amendment. Therefore, avoiding the risk of excessive enthusiasm, it is unwise to delve to deeply into it, at least in areas that are beyond the knowledge of the author of this publication and especially in the economic aspects, even though a modest economic approach is attempted. From a legal point of view (as it is later mentioned), the proposal finds absolute communion with the objectives and principles already present in the TRIPS Agreement, and its introduction would enhance these principles and objectives.

The exclusivity over an invention could have a higher or lower economic significance, depending on its practical application. As the exclusivity over the invention must be established by a general and abstract rule (since it is not adjustable for each specific case), the exclusivity period should be a period of time that ensures sufficient return on the investment even in cases of inventions with lower economic significance. This will guarantee retribution to any investment in research and development. This is appropriate, especially considering that not all investment will necessarily end with the appearance of a new invention. This could allow an investment recovery as well as a deserved reward in most cases—the greater the practical application of an invention, the greater the reward. It is important to restate that the compensation described in previous lines (in a just system) must be assumed proportionally, globally, and according to the capacity of the various countries. This could permit increasing the reward toward investments in research and development without undermining the rights of the poorest populations.

In several attempts to determine a suitable approach to the duration of the right of a patent, countless theories have been produced, among which is worth mentioning the theory of reward or incentive theory, wherein the protection is a mechanism to attract efforts and resources for the development of the inventions. Other examples are the theory of retribution, which is based on making it possible for the inventor to recover the investment on developing the invention, or the diffusion of knowledge theory, in which the protection seeks the diffusion of inventions for society as a whole to benefit from the knowledge while it recognize a right to the inventor. The optimum (as this study argues) will be granting a period not only to ensure the recovery of the investment but an additional reward in consideration for the disclosure of the invention as well. This period should be as long as possible. If each country contributes according to their capability, it will not be necessary to spare the incentives that the global community wants to give to those who by investing in research and development have encountered useful inventions for mankind.

Some even argue that not even from the economic point of view, the utility of the patent regime is conclusive. In this regard Remiche and Desterbecq must again be quoted. They affirm—sustained in Abbott—that “the most reasoned studies about the patent system have been inconclusive regarding the social or economic utility of the system.” Supported in a long list of authors who agree on the matter (especially Siebeck, Evenson, Lesser, and Braga) declared, “Generally, the economical theory has raised more questions about the beneficial implications of intellectual property than what it has responded». Remiche and Desterbecq mention Posner, Vernon, Hirsch, Thurow, Siebeck, Evenson, Lesser and Braga, among others, as writers who share this opinion.” (Remiche and Desterbecq 1997, 249-250)

The truth is that by introducing proportionality into the universal patent system, the discussion of an absolute justification will not be needed. None has proven to be irrefutable on this matter. The proposal contained in these lines looks for the global market to generously secure investment in research and development (even in case of minor inventions of less economic implication) and give an ample compensation to those inventions that have proven they have great practical applications. This could be viable if the retribution that humanity gives to the patent holder (measured in years of exclusive exploitation) is granted proportionately by the different countries according to their economic capacities.

As a result, the human race as a whole could even be more generous with inventors and their investors, bearing the burden that this generosity would mean in a proportional way. This book does not seek to establish a priori the equilibrium or the optimal period of extension for a patent. Proportionality will take care of this. It could be easier to obtain objective economic conclusions and consensus if the patent monopoly is shouldered proportionally by the different countries or trade regions (by the different populations of the planet).

The duration of the patent is the aspect that in a greater way is up to the discretion of human conceptions. It results difficult to quantify the retribution that global society wants or can give to inventors for their undeniable contributions. (It is difficult to settle on a number, so to speak). From an axiological point of view, it is impossible to appreciate a priori whether a given period of exclusivity is just per se. However it is possible to notice whether it ceases to be just, if facts show that this is happening. Thus, the term of protection should be the highest possible, limited by any evidence of unjustified reduction of general welfare (at that moment, if a reduction of general welfare is produced, it would become unfair). Proportionality will also contribute on the effort to determine an optimal period of protection.

Under this hypothetical system, the term of protection granted by a patent will not be the same in all countries. An additional consideration must then be added. It won’t be permanent one either. Given that the determination of the term of protection a patent grants would be in relation to a variable factor as it is with the economic capacity of countries, this may vary over time. The frequency of revisions that might arise is a matter to be determined under a deep technical and economic analysis, yet it must be pointed out that it should tend to be as frequent as possible.

The flexibility referred to above (far from being a negative aspect) would mean a great contribution to the system. It is enough to recall that the nations of the world for various reasons can undergo economic crises. Almost without exceptions, crises have been suffered, even by the most developed countries. Being so, any country could benefit in the course of history with this hypothetical system (coherent with an axiological perspective), given that in a crisis scenario their inhabitants would see decreased the period of exclusivity granted to patented inventions in their territory. What a better way to sympathize with fellow countries when they are in crises. This kind of solidarity undoubtedly could have a positive impact on the cohesion of humanity. Meanwhile, if a country benefits from a short-term protection, it will be because it is passing through a bad economic situation, which obviously that country will try to solve. If this is achieved and the country improves its economic condition, it will be in a position to contribute more to the technological progress of humanity. Consequently the exclusivity period that this country grants to patent holders in its territory will be extended.

This flexibility can be a positive element, as it was briefly reviewed in the previous paragraphs, but it may bring some practical complications that must be overcome with specific regulations. There may be situations in which (because of the better or worse economic situation of a country) a patent that had expired under a previous exclusivity period would be in a position to recover its availability (or vice versa), which could in turn lead to affecting third parties. In any case, it can be said that once the term of protection that a country is required to provide is known (which may vary according to the frequency in which the reviews are determined by the rule), the status of a particular patent will be known (if the patent could be enforced or if it has become of public use in that particular country). This way, if the fact justifying an assignment disappears, the contractual obligations of this assignment (which are accessory to this fact) will disappear too. The proportional system implementation will certainly bring difficulties, but the solutions surely can be found. Clearly this is not yet the time to develop them further.

Although the corrective the present study proposes to introduce into the global system of protection for inventions is absolutely logical, no proposals worldwide in this regard have been identified in the doctrine so far. This is an unpublished proposal. The closest approach to this study was made by the economist Alan Deardorff, whose conclusions are tuned with what this book proposes (Deardorff 1991, 35-51). This economist, when he is making an economic analysis of the patent system, concludes that to apply patent protection to certain developing countries—because of the damage it could cause them and because of their small markets (their little contribution)—is inconsistent, incoherent, and unnecessary. He affirms that to extend the patent system to some developing countries—because of their small economies and incipient markets—is not economically significant.[1]

Although Deardorff main conclusions are correct, he makes a major mistake as to the solution proposed.[2] The patent system should be maintained for poor countries contrary to the statement made by Deardorff, mainly because they have aspirations not to remain poor. He also correctly argues that the system currently conceived harms them. Countries must contribute according to their capability, but they should not stop contributing to the overall global retribution. This is not only because they have the aspiration to stop being poor but also because it will be correct for them to legitimately benefit of technological progress by contributing according to their capacity.[3] Therefore, it would not be right that the patent system is limited to the “inventive countries.”[4] Taking in consideration the concepts of the work cited above, for a conclusive analysis when establishing the contribution the different countries could give to the international reward for inventions, a multitude of variables should be taken into consideration, yet two major elements can be identified—the economic capacity of countries and the size of their markets.

Currently, “the term of protection available shall not end before the expiration of a period of twenty years counted from the filing date” (article 33 of the TRIPS Agreement), without regard to the economic capability of the different countries. (Individual members may allow a period of protection greater than this minimum.) Without doubt, as it is clear from the analysis that is raised in this subchapter, this is the aspect to correct in order to achieve a fair system of protection for inventions. This correction, as it will be shown in the next subchapter concerning the effectiveness of the TRIPS Agreement, could assist in the efforts to achieve an effective recognition of intellectual property rights.

It is worth pointing out that in regard to the term of duration of a patent, the authors Dhar and Rao have raised a proposal that differs from the one contained in these pages.

 

Another very important aspect is the uniform period of 20 years of protection that TRIPS has built, and which does not correspond to the technological lifetime for products of different areas. So for example, in informatics the cycles last between 3 and 5 years, in software 4–5 years, in electronics 5–6 years, in metallurgy from 12 to 15 years, and in pharmaceuticals from 15 to 20 years. Such great differences represent a huge social cost, as to having a uniform patent term of protection of 20-years. (Dhar and Rao 1997, 231)

 

The corrective proposed by these authors of the Indian subcontinent is not coherent, the reason being that a protection of a product of the intellect that has lost its utilitarian life is not at all onerous for society, as it would protect an intangible asset that no one cares to reproduce. On the other hand, the current lack of proportionality concerning the patent term in relation with the economic capability of the different countries imposes inequitably to the different contributors who suffer an equal monopoly of twenty years.

Once having addressed the above regarding the principle of proportionality (a principle whereby inclusion is necessary and essential in the current scheme), it is time to review other principles of the global patent regime. As it was already mentioned, the objectives and principles that this book identifies as global principles worth promoting are recognized in the objectives and principles of the TRIPS Agreement (with the exception of the principle of proportionality). This encourages the possibility to achieve within the TRIPS Agreement itself an adequate system of protection.

An important principle of the patent system is to achieve from the patent holder the disclosure of its invention. With the disclosure prior art (human knowledge) is increased. When applying this principle, the new invention has a positive effect on society as a whole (thus fulfilling its goal), which will enable further technological development and greater global welfare. The principle of disclosure agrees with the goal behind the principle of technology transfer. The underlying objective in both cases is the positive impact on the knowledge of humanity altogether, which certainly should be encouraged. As to the principle of disclosure little more can be said (see chapter 2.1. Validity), other than different internal laws should demand a proper disclosure of the invention in order for it to fulfill its goal.

On the other hand, technology transfer is an objective that the current regime has failed to achieve. Even though technology transfer is a value referred to in the statement of principles and objectives of the TRIPS Agreement, this goal is not met in a complete way by the current regime. It has even been argued based on solid reasons that the currently conceived system perpetuates the differences or the technology gap between the developed and developing countries. Dhar and Rao presented a very interesting analysis that argues that the system currently conceived ensures that the gap between inventive and noninventive countries perpetuates itself. They base this conclusion on the so-called theory of the “patent paradox.” This theory was first developed in 1939 by Robinson and then subsequently addressed by Hayek, Marshal, Burns, Jewkes, Sawyers and Stilerman, Taylor, Silberston, among others. According to the theory, the patent monopoly leads to the destruction of competition and ensures access to the protection only for powerful companies. (Of course there are many opinions that are opposed to this one.) These Indian authors concluded that “the cost of a monopoly for the rest of the economy exceeds the benefit of having a patent based technology.” (Dhar and Rao 1997, 143) This last criterion sadly makes sense for the poorest populations in relation to the currently conceived system because the principle of proportionality is not present.

The tools that the agreement foresees to ensure the goal of technology transfer have proven to be ineffective. For example, article 66 of the TRIPS Agreement determines that developed members shall provide incentives to enterprises and institutions in their territories for the purpose of promoting and encouraging technology transfer to least-developed countries (this is a category established by the TRIPS Agreement) to enable them to create a solid and viable technology base. It is neither feasible nor coherent (in other words, just) for the holder of a patent (or the country in which the inventor resides) to be prompted to share or transfer its innovative technology after all the effort and risk invested. This renders the regulation inapplicable. It is a rule of poor axiological content (unfair), which is difficult to implement effectively.[5]

As a result of this, so far the principle of technology transfer has been merely declaratory, except for certain programs conducted by some industrialized countries to support other less fortunate ones. From the perspective of developed countries—if this hypothetical system came to be implemented—the resources destined to these programs could be better used to increase their own poor populations’ access to new technologies, especially regarding health and the poorest part of their population. Technology transfer, as it is established, is a rule that aims to capture an important goal, but because of its poor axiological content (justice), it has become a mere romantic statement. As explained in the following paragraphs, a remedy for this situation could be found, and a real and effective transfer of technology to those who needs it the most could be achieved under the principle of proportionality in conjunction with the global principle of free movement of the goods protected by intellectual property rights (principle recognized by the TRIPS Agreement).

With the introduction of justice into the current system through different protection periods on account of the economical capability 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. The resources destined to comply with article 66 of the TRIPS Agreement (technological transfer to developing countries), should instead destined these resources to secure that their poor population has access to new medical advances. (If the proposed scheme came to be implemented, in which the exclusive exploitation of new technologies will last longer in the circumscriptions of developed counties, it is probable that the governments of those countries would chose to destine resources to aloud their less privileged population to have access to this new technologies, specially when it come to medicines.) 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. And 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 capability of countries. Technology transfer could result of the system.[6]

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 inventions released earlier in these countries. Eventually they could export these 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 countries in which the patent term has not yet expire. Technology could be transferred to the countries that are most in need not in response to alms (which have proven not applicable because of their poor axiological content) but thanks to a free-trade market. 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 behind the patent system. This idea (commented in the previous lines) is no more than an educated guess. 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 (see annex C).

In accordance with the previously mentioned (provided the central proposal of this study is implemented), the principle of the TRIPS Agreement by which the importation of a product is consider as exploitation of the same should be reaffirmed. International trade agents could probably operate in developing countries attracted by the early release of the patent in order to exploit in an early fashion the inventions of their competition (as their competition could exploit theirs) and gradually export from those countries to the rest of the world. This could allow exports from poor countries to the rest world, promoting technology transfer and foreign investment for the countries in the most need.

Finally the main objective of the protection for inventions and its raison d’être is to obtain further technological development. Without the promotion of research and development of new technologies as part of the system, a patent protection system will make no sense at all. It would be disfigured in such way that it wouldn’t be identifiable as such. An explanation about this goal is in order. The underlying objective of the patent regime is general welfare, not technological development by itself.

It is very likely that the poorest countries’ welfare has been affected within the current system because of its lack of proportionality. At least it can be said for sure that the poorest population has not had its fair share on the welfare produced by technological development. The proposal of this book (if adopted) will correct this situation.

On the other hand, it is a fact that global general welfare in terms of the ecosystem has been affected by technological development. The affectation to the environment could not be blamed on the current global or earlier national systems of protection of inventions. Mankind ignorance and voracity is accountable. This book does not intent to delve into explaining this historical and sad truth. (It is not part of its scope of study.) As with the current patent scheme, this book does not intent to mourn about mistakes of the past but to propose plausible changes for the future. Within a well-structured system of protection—as the one this book advocates—mankind could try to revert this situation. In the current time new technologies should stop and correct the damage done by some previous technologies to the environment. Research and development with this objective must be encouraged with retribution. The global retribution (which is measured in years of exclusivity) to this kind of technologies (green technologies)—if proportionally contributed by the different countries according to their economic status—could be greater. A system of protection for inventions must remain only while it contributes to the achievement of general welfare. Otherwise it is not justified.[7]

The risk that comes from investment in technological development is undeniable. Costs during the research process can be astronomical. Social actors will make the decision to invest in research and development only if the patent system assures adequate protection for the outcome of their efforts. By stimulating investment in research proportionally, society could be compensated by the monopoly that it grants.[8] Otherwise investments will be reduced, directly damaging the global community, the public interest, and general welfare. If it is not done proportionally (as it happens now), damage is produced to developing countries’ pauper populations, while developed countries are unaffected.

Therefore, it is safe to say that the system of protection for inventions that is implemented by a particular patent regime—from a macro point of view—benefits the community even more than the inventor. In a global system this will be so as long as the remuneration provided to the inventor is proportionately assumed by humanity. The availability of new technologies and knowledge dissemination of these new technologies is the ratio essendi of granting exclusivity on an intellectual product for a specified period of time. As Correa has explained, the US case law (for example) has been absolutely clear in this regard: “The incentive for risky investment is the fundamental purpose of the patent grant and it is based directly on the right of exclusion.” (Correa 1997, 98)

A principle in the TRIPS Agreement that enables research and development of new technologies is the one that determines that protection should be granted to any inventions in all and any field of technology. As it will be discussed in annex B of this publication, it is correct that this principle admits some exceptions (as for example the patentability of genetic material in order to respect the point of view of the different populations on these regards), but provided that an axiological coherent (just) system is structured, these should be the fewest possible. Proportionality could produce the necessary consensus between developed and developing countries.

Limitations and exceptions in the agreement could be reduced, and a wide scope system for protection could even be adopted in a global scale (like the one conceived in the United States, for example) if this entails the introduction of proportionality. In a proportional system, applying the American conceptions worldwide would not seem misguided. The truth is that investment in research and development of new products will be in a better way promoted to the extent that these investments are rewarded. (This reflection is applicable to all areas of technology.)

The harmonization of the legislation on intellectual property worldwide is a commendable element of the TRIPS Agreement. It attacks the global market distortions that a disparate regulation produces. This great objective—which must remain undoubtedly—calls for greater harmonization of the universal regulations as far as possible. In the annexes of this publication, comments are made about the feasibility of a greater uniformity or homologation. This is an objective claimed by industrialized countries that could be desirable as long as the principle of proportionality is introduced into the current regime.

In regard of the above, a digression is in order. The existence of minimum compliance regulations in the TRIPS Agreement has harmonized the rules. This has ensured in a certain degree less market distortion. Bercovitz accurately states that the “global market requires minimum levels of protection in all countries, so as not to create competitive differences that distort the functioning of the same.” (Bercovitz 1997, 19) However, avoiding market distortions does not require identical terms of protection in regard to the duration of the exclusive right. Actually no patent has the same duration between different countries because of different filing dates. Therefore, the exclusivity granted by a patent could be of a different duration from one country to another in reference to their economic capacity. For the system to work, it is required that the same rules of the game apply the same way for all the market players, but that is not to say that patents must have the same exact duration. Considering that objective, countries should set and meet the minimum correspondent parameters that are determined by the TRIPS Agreement to ensure recognition of intellectual property rights.[9]

In the hypothetical implementation of the proposed system, all trade agents in the world market regardless of their nationalities will be guaranteed the same period of protection for their inventions. Of course, the period of protection given to a trade agent will vary from country to country—according to the principle of proportionality—but always in the same way for all of them. Thus, the objective of avoiding market distortions will remain untouched despite the lack of an equalized global term of duration of the right granted by a patent among different countries. When the rights conferred by a patent are infringed upon or when the rules vary from legislation to legislation, spots of market distortion are presented. The different right duration from one country to another under their different economic capacity will not. If the proposed amendment is accepted, a higher degree of harmonization could be desirable.

In conclusion, the aspect to be modified in order to achieve a harmonized universal system—one that seeks to eliminate market distortions and to promote investment in research and development, that promotes technology transfer, and that achieves an effective implementation of the established rules (as will be showed in the next subchapter)—is the duration of the rights that a patent grants. For this purpose a key element that once was shelved (but not because of that reason should be forgotten) must be included—proportionality. The obvious economic differences between different countries must be recognized. Then the term of protection of the patent must be set under these circumstances.[10] [….] Kresalja concisely summarizes the problem that has polarized humanity facing the legal protection of inventions. “The dilemma is raised, as has always been in the history of the patent system, between the desires of those who want to patent everything and those that believe it necessary to pursue other interests.” (Kresalja 2001, 225) As it was said throughout this study, with the introduction of the proposed corrective, these two positions are not irreconcilable. Proportionality could ultimately contribute to bring the aspirations of both groups together because it recognizes the aspiration of both groups. Notwithstanding the previous, to generate an equitable global agreement is a purpose that should justify the proposed correction per se. Nevertheless, it is positive for this corrective not only to be just and equitable but also convenient for all. This scheme recognizes the aspirations of both groups that have been constituted in the international arena (developed and developing countries).

As showed in this book, the objectives and principles of a well-structured patent system are all present in the TRIPS Agreement, except proportionality. If proportionality came to be included, the compensation or reward to the patent holder could be higher. The promotion of research and development could even be globally bigger through a proportional system. The incentive to competitiveness, achieved by the free global flow of products protected by intellectual property rights, would improve in this hypothetical scheme. The disclosure of knowledge and technology transfer will be optimally achieved by introducing the principle of proportionality as was pointed out in section 2.2 of this book, when in it the justness of the rule was analyzed. Finally the reduction of market distortions that an uneven regulation and uneven protection produces will be achieved by harmonizing the rules on intellectual property (which is desirable as long as the correction proposed on this book is introduced) and through a more effective recognition of the regulations in developing countries as was pointed out in section 2.3 of this book, when the positive impact that proportionally could have in the effectiveness of the regulation was analyzed.

This book studies the most important issue of intellectual property—patents. Although not all the conclusions of this study on the required modifications of the system of patents are applicable to other types of immaterial protection, many recommendations stated here are applicable to other aspects of intellectual property. A thorough analysis on whether proportionality is applicable to copyright/droit d’auteur, fore example, will be necessary before translating the proposed scheme regarding patents toward this kind of intellectual property protection, or other schemes of intellectual property protection in general.

Notwithstanding the risk of an excess of optimism, this book argues that its proposal could consolidate patents as a universally recognized and accepted right not only in the regulations but also in the common belief of the population worldwide. Consequently it could strengthen intellectual property as a whole. This is vital, specifically if people remember that not all of humanity necessarily shares the evident advantage that the protection of intellectual products has on society.[1] An example of this is what once was said by the iconic Indira Gandhi. “The idea of a better ordered world is one in which medical discoveries are free from patents and there is no profit with life and death.” (Remice and Desterbecq 1997, 262)

Consolidating intellectual property in general as a worldwide form of property is certainly a goal that must be taken seriously. Recently a tendency to not recognize intellectual property has emerged from certain countries, which is alarming. In regards to patents Venezuela has infringe the TRIPS Agreement by no longer recognizing protection to pharmaceutical products.[2] This proposal differentiates itself far from the Venezuelan position. Unlike the Venezuelan position, the proposal presented in this book believes in the system.

From an axiological (justice) point of view, the adoption of the proposal outlined in these pages is evident. It would be wrong and unnecessary for this new conception to be imposed by pressures or attitudes like the ones that have emerged from Venezuela. Doing so will be a mistake. This proposal should be nurtured from the power of reason, not from imposition.

The implementation of this proposal would not affect the interests of patent holders. Multinational corporations, for instance, are the main actors in the development of technological innovations that are ultimately beneficial to the whole world. Often these companies have been demonized for having an economic interest in mind, which in the end is logical. Of course it is wrong that these companies influence intellectual property regulations, as their aspirations will lead them to concrete rules that best suit their own interests. But this does not mean that when the international community is regulating intellectual property, their aspirations must be ignored. The proposed scheme should promote if not a greater financial reward to the investment in research and development of new technologies then at least an equal compensation to the one that multinationals or other actors in the technological innovations are currently receiving. From the perspective of multinational enterprises, one more year in the duration of patent protection in the European Union could serve to cover the remuneration or reward that all Sub-Saharan Africa contributes for a decade.

In reality, it must be accepted that the amendment proposed by this study will be difficult to settle not only from a legal, economic, and technical point of view but more so from a geopolitical perspective. The inclusion in the TRIPS Agreement of the proposal contained in these pages is quite plausible. Therefore, it is a cornerstone for correcting the international patent scheme that should not succumb. The forum for achieving the proposed change is undoubtedly the WTO and within it particularly the Council for TRIPS, which is the space created by the WTO in the TRIPS Agreement for further negotiations.[3] Every proposal must be discussed in these forums, but finally its approval will depend of the hypothetical amendment ratification by two thirds of the WTO members. In practical terms for this to happen, a global consensus should be accomplished. Organized, civil society must demand its implementation. The decision will ultimately depend on the willingness of the different governments of the world.

As mentioned in the first chapter of this study, a global system that ensures democratic representation in decision-making is currently inconceivable. According to José Eduardo Faria, as an adverse effect of globalization, a phenomenon that he has baptized as “neo-legal feudalism” is presented, that is instrumented through a system of international organizations. Nevertheless, it is reasonable to demand that existing international organizations legislate considering the general welfare of all mankind.[4] This situation is certainly a recession of humankind when it is compared with the progress made under the setting of the civil rights and rechtsstaat (the rule of law), and so it must be remedied. (Faria 2001, 264).

The ultimate expressions of social organization are still national states, so the sum of their power will enable a given international order. Therefore, it should be required from all the governments of the world that the supranational regulations take into account the common welfare of all humanity. This could be stated as the pro bono humani generis principle (Segura 2003, 81, 319, 343, 599). “The developed world needs to do its part to reform the international institutions that govern globalization.” (Stiglitz 2002, 348) However, there are voices that warn, and Alzamora stated that “The concept of a new economic order has been formally repudiated by the north and resignedly abandoned by the south.” (Kresalja 2001, 207) The application of the pro bono humani generis principle should be demanded in order for this proposal to become a reality.

Since the events of the Seattle Round, which are in the public domain, the legitimacy of the WTO has been heavily criticized. Notwithstanding the risk of an excess of optimism, if the hypothetic system that this study proposes becomes a reality, a greater global cohesion will be achieved. The corrective proposed in this study not only would assist a more just and effective protection for inventions but could serve as an anchor for global harmony of mankind. Globalization is an inevitable reality that manifests itself even against opposing views. Globalization should not be ignored as a cultural phenomenon. (In this aspect most studies agree.) However, it is necessary to modify its conception. As Stiglitz maintains, globalization itself is neither good nor bad. He explains, “The mind-set around globalization itself must change.” (Stiglitz 2002, 341)

It must be stated that the inescapable extreme poverty that affects many parts of the world and the insufficient access to inventions that populations suffering from this reality endure have been points of concern for the WTO. Taking a look at the Doha Declaration in regard to the current system is enough to understand these preoccupations (the Declaration of the Fourth Ministerial Conference celebrated in Qatar in November 2001). Unfortunately the well-intentioned Doha Declaration was no more than an accusative revelation of alarming facts without being a real and concrete solution[5] (Stiglitz 2002, 346). As Stiglitz says, “At Doha, the developing countries only agreed to begin discussing a fairer trade agenda; the imbalances of the past have yet to be redressed.” (Stiglitz 2002, 346) These efforts are valid, but it is still not enough.

This proposal in the short term will favor in a direct way developing countries whose populations will see the terms of protections for inventions reduced. Also in the short term multinational enterprises will earn more if the global retribution is higher, thus indirectly benefiting developed countries where these enterprises are formed. In the long term humanity will benefit as a whole with more investment in research and development of new technologies. Poor countries should try to accomplish the goal of reducing the technology gap in order to capitalize of this new hypothetical system in the long run. This will not be achieved by the simple grace of the rule obviously. However, it will be encouraging that developing countries can put their minds toward this objective under a worldwide policy that really allows them to do so. The rest would be in their hands.

As Stiglitz says, “The advance of science and technology from abroad (even though is wonderful and great), cannot obscure the fact that the essence of its success lies in the existence of free people, that with character and optimism face their destiny. A matter in which all people are capable to give a positive response if they propose to.” (Stiglitz 2002, 74)

If the proposed corrective is introduced in the current regime of protection for inventions, the countries with better economic situation should extent the period of protection for inventions in their territorial constituencies while the poorest countries will see the periods of protection reduced. Although the populations of developed countries will suffer more years of exclusivity than what they do nowadays and certainly more years of exclusivity than populations of developing countries, the insertion of the proportionality principle in the current regime of protection for inventions is a useful tool to correct the system, taking into account the claims of both developed and developing countries. More reward means more development. The key is to have that reward come proportionally so that it can be afforded. That being reflected, not only would a proportional justice be achieved, but also an event of global generosity without precedent in the history of mankind would be witnessed. Hobbes’s theory would be proven wrong, and cohesion of humanity would be envisioned as global. The Achilles heel of the idea presented in this book is that it maybe utopian; it would not be surprising that once again it is proven that homo homini lupus.

[1] “This even gets more complicated when you consider that not all countries have the same conception of the objectives that Intellectual Rights have to accomplish, as there are cultures that, unlike the Western culture, believe that knowledge must be passed as soon as possible to the public domain, without considering with the same enthusiasm the cause-effect relationship between the legal protection and the increase of knowledge. Thus, the creation of a new global system is only possible if there is a widespread acceptance of its characteristics, despite the differences that may arise on what to protect and how to do it.” (Kresalja 2001, 277-278)

[2] “On April 22, 2006, Venezuela denounced the Cartagena Agreement ceasing from that date the preferred and direct application of Andean Community rules. From that moment on, the application of Decision 486 of the Common Intellectual Property Regime ceases and as a consequence the text of Industrial Property Law is applied, which in art. 15 prohibits the patenting of pharmaceutical products.” (Frente de Trabajadores Socialistas del SAPI 2008)

[3] Section 7 of TRIPS Agreement creates the Council for TRIPS as a body for further negotiations. As Gomez Segade says, “The Council for TRIPS is the catalyst instrument of any possible increase in protection to new fields and materials and therefore in the near future will assume the leading role and global leadership in the field of intellectual property.” As Kresalja states, referring to this Council “shall all persons and entities interested in intellectual property, being Member States, companies, inventors, attorneys and agents, monitor their performance, recommendations and proposals. Parallel to the work done by the Council for TRIPS and as a support within the WTO, the so-called negotiation rounds are held.

[4] Meesen stated that “Those who think like this consider that more than the bilateral reciprocity seek by developed countries, a global reciprocity fruit of multilateralism must be seek, as individual judgments about what is right and unilateral actions to correct the lack of reciprocity, are practices inconsistent with the maintenance of an orderly international trading system.” (Kresalja 2001, 206). Remiche and Desterbecq in this regard they stated, “Accordingly, although specific legal systems such as patents, trade, health and development cannot be readily interpreted, they may however become compatible enough to make a balance come among them, perhaps fragile, but very desirable.” (Remiche and Desterbecq 1997, 328) With a general view, this conception has been raised by the general assembly of the United Nations since long ago. This international organism issued a document known as “the proposal for a new international economic order” (Sixth period extraordinary session, May 1974), which in its fourth article states, “The new international economic order should be based on full respect for the following principles: […] b) the preferential and non-reciprocal treatment to developing countries, where feasible, in all areas of international economic cooperation if possible”.

[5] Among other items, the Doha Declaration determines issues concerning the implementation of the TRIPS Agreement, in particular in its eleventh section addressing aspects of intellectual property rights related to trade in addition to referring to public health issues. It calls for a mechanism for technology transfer to the undeveloped countries (WTO 2002).

[1] «Under specified circumstances is not optimal to extend patent protection to all countries of the world», (Deardorff 1991, 48).

[2] “However, the case for universal patent protection is not a clear one (as my analysis demonstrates), and the concern of some developing countries that they will be exploited by patent protection are not without foundation,” (Deardorff 1991, 36).

[3] “Thus, a case can be made, in terms of world welfare, for limiting the coverage of a patent protection to less than the entire world […] I will then show the extending protection to the other countries is very likely to be harmful to them, in spite of the fact that they will be benefit from increased inventive step.” Ibid.

[4] Deardorff identifies developed countries as “inventing countries,” which is a common denomination among English authors. (Deardorff 1991, 48)

[5] A similar finding of how the inappropriate axiological (unfair) content of a rule impacts negatively in its effectiveness is seen dramatically in the general failure to comply with the current global system of some developing countries. (Not officially by their government but by their people.) In some of these countries there is an obvious disrespect for the rules of protection of intellectual products in general. (This is denounced with a strong foundation by developed countries.) The global system of protection for inventions and intellectual property in general is perceived in developing countries as harmful. This could be remedy with the introduction of proportionality because a fairer scheme will be easier to apply, as argued in the next subchapter (see Chapter 2.3. Effectiveness).

[6] 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)

[7] A well intended proposal was presented in 2013 by Ecuador to the Council for the TRIPS, seeking technological transfer of the eco-technologies by establishing exceptions and limits to the protection of such inventions. Although well intended, the proposed solution is incorrect. Less retribution for this kind of technologies means less investment in research and development. More eco-technologies could only be further encouraged if the retribution is bigger. If proportionality came to be introduced, a different retribution (longer term of protection) could be analyzed and established for this kind of technologies.

[8] Carlos Correa, for example, does not see the equation more reward equal more technology as absolutely clear. “Under the prevailing idea that is maintained today, it is supposed that by allowing the availability of technological products (which would not happen hypothetically, if there is no protection) by stimulating investment in research, society is completely compensated by the monopoly that it grants.” (Correa 1997, 98). As with everything, there are others that do. “The promotion of technological knowledge, i.e. to give to the society as many solutions to the technical problems that arise, maintain properly in order the knowledge and promote its exploitation and its application in reality (as far as possible). Only then, it is justified that the legal system gives individuals or companies the immense power to monopolize a technical answer (a solution) in a free enterprise economy market where, in principle, legal monopolies should not exist.” (Bercovitz 1967)

[9] “Harmonization but not equalization is desirable. We need a substantive IP system, but simply heading uncritically down a road of more and stronger exclusivity is wrong for many of us.” (Sulston 2006)

[10] Once and if the above is structured in order for this hypothetical system to work optimally, the procedures, analysis, and effects for granting a patent shall be as universal as possible. This will be desirable if a just system is established, but in any case, it will still be difficult to achieve. An analysis in this regard is presented in annex A of this publication.”