Abu-Ghazaleh: The dream of economic unity or a common Arab market is necessary after the cancellation of commercial borders worldwide
The increase in the trade volume of counterfeit products was the primary reason that industrialized countries asked for creating an agreement for protection of intellectual property rights (IPRs). This idea was submitted during the Tokyo Round, but no treaty crystallized there.
At the start of the Uruguay Round, industrialized nations demanded that in addition to protection against counterfeit products, that minimum protection limits be created for adoption by all member-states.
Developing countries were hesitant to expand the scope of protection for IPRs and establishing minimum limits for such protection, because that would require them to change their economic policies and due to social and economic developmental reasons, some sensitive products were excluded from protection such as medicines, fertilizers, chemicals and pesticides. Also, the protection periods on some of these products are shorter than those prevalent in international treaties.
Therefore, adopting such limits would force these countries to both pay duties on the usage of patents for their products that are excluded from protection, and extend protection periods.
Developing nations justified their fear that strengthening IPRs’ protection might lead to unfair and wrongful practices against them by the owners of IPRs, such as the refusal to grant them a license or putting in place difficult requirements to obtain and license technology. But at the end of the negotiations, industrialized countries achieved what they sought and many fields were subject to protection. This was a development that neither developing nor industrialized states were expecting to take place prior to the end of the Uruguay Round negotiations.
Mr. Talal Abu-Ghazaleh, Chairman of the Arab Society for the Protection of Intellectual Property (ASPIP), states that the strength of an IPRs treaty relating to trade is drawn from the fact that all member-states in the World Trade Organization (WTO) need to implement such an agreement in all its articles. This requires revising their legislations to conform to the treaty’s requirements during the transitional periods mentioned in that document. There are exceptions to protect general ethics, the welfare of humans, animals and plants, and averting any danger to the environment.
There is a text within the treaty that refers to transitional periods for assisting member-states, particularly those that are less-developed, in organizing their matters and specifically the legal ones, to conform to the TRIPS Agreement conditions.
Abu-Ghazaleh points out that “Some products such as foodstuffs, chemicals and medicines are excluded from protection in developing countries, or are assigned a protection period that is less than the minimum limits of protection called for in the agreement. Also some of these states grant protection to the method of manufacture as opposed to the final product, while in other countries, computer software is not subject to protection.
As for the transitional periods granted to each group of member-states, there is one year for the advanced industrialized nations and 5 years for developing countries and countries that are in the transformation stage from centralized economies to free economies. Less developed countries are granted 11 years.
Regarding countries that don’t have protection for chemicals, medicines and foodstuffs, or apply protection to the method of manufacture, they are permitted to apply for an extension of the transitional period for an additional 5 years.
The transitional periods do not mean reducing protection or taking advantage of it to register a new manufacturing method instead of paying for usage of the patent. In all cases, it is expected that all member-states apply right from the beginning the Most-Favored Nation (MFN) principle, in addition to the principle of national treatment.
The dream of creating Arab economic unity or an Arab economic trade market has become a necessity because it is the only way to protect Arab economies after the cancellation of commercial borders in the world.”
The ASPIP chairman adds that “The impact of Arab nations in the WTO is still weak, as there are only 9 Arab countries that enjoy WTO membership out of 131 states, in addition to 5 Arab nations on their way to negotiations in this regard.”
Abu-Ghazaleh ‘sounds the alarm’ because a treaty is currently being formulated to liberalize the insurance sector which will have a profound effect on the insurance industry in every Arab country, because protection and the terms of practice will differ, and each one will have to face enormous global powers.
Further, action is taking place to liberalize 155 sectors including banks, tourism and shipping.
Abu-Ghazaleh criticized the non-liberalization of the oil trade, pointing out that oil was considered a strategic good and not a commercial one that could be subject to the market economies.
Abu-Ghazaleh says that providing intellectual property (IP) protection in Arab states doesn’t mean serving foreign interests as may be commonly thought, and that the joining of Arab nations in this protection increases support for Arab innovators and provides them the opportunity to continue fulfilling their designated role in enhancing and supporting the national economy. This protection also creates incentives for countries to bolster their research and development (R&D) centers.
Abu-Ghazaleh adds that IP circumstances in the Arab region, in light of moving towards the WTO, with 9 Arab countries members already and 5 more becoming so in negotiations with the 131-member organization, aren’t reassuring. He says that extensive efforts must be exerted along with work that is compatible with the requirements of the upcoming phase. He pointed out that the Society, in collaboration with the WTO, will soon issue the Business Guide to the Uruguay Round translated into Arabic.
He said that the TRIPS agreement is one of the main treaties emanating from the WTO that is characterized by its mandatory nature for member-states, and that the optional nature of this agreement no longer exists after procedures of capital investment and economic participation became connected to standards and foundations that are primarily binding.
He is of the opinion that the global commercial order makes the whole world one market where commercial boundaries aren’t permissible for a country, but political ones are.
The volume of global trade is 5 trillion dollars annually, and the percentage of services trade in the American economy represents 80% of the income, and is thought of as a modest number. He points out that the world’s interest in IPRs comes about when we see that the value of the most expensive trademark is 36 billion dollars and 87% of the company’s profit is from the mark’s value. Also, 85% of revenues from patents and inventions are for the five advanced nations, because they established the groundwork in which to protect their patents. Yet the global losses due to pirating activities are estimated at 700 million dollars. Pirating rates on patents worldwide are as follows: 20% in the USA, 50% in Europe, 97% in China and 90% in the Arab countries.
He pointed out to the significance of developing Arab legislations in the field of IP, the preparation of training programs for workers in this field, training judges and legal professionals and educating them, enhancing customs inspection centers with qualified cadres and following strict monitoring methods in industries in accordance with international standards. All these actions are necessary so that we’ll be ready when the time comes, according to Abu-Ghazaleh.
He discussed the advantages of the TRIPS agreement, stating “We aren’t its promoters, but it is now a reality since 131 nations have signed up to it. So the convention is keen to organize technology contracts and industrial licenses, and is characterized with transparency in its implementation, making the whole world a single integrative unit.
And while it may be true to say that the White House now controls world affairs when it comes to IP protection and that there is American pursuit that goes after counterfeiters and infringers, yet the rights of the Arab world will not be harmed unless Arab nations fall short of shouldering their responsibilities in the upcoming stage. This phase will require increased awareness and preparation to absorb the technology of the next century. Arab industries in general and Jordanian industries in particular will benefit from the experiences of advanced countries. These industries will develop their products in light of the new world, after the opening of borders and removal of customs barriers, and after all nations of the globe become important parts of one system.
Arab businessmen must contribute to the success of the upcoming march.”
As for Jordan, Abu-Ghazaleh said that despite its membership in the Paris Convention and the World Intellectual Property Organization (WIPO), it is only a member in 20 international treaties involved in IP that are sponsored by WIPO. Meanwhile, negotiations are ongoing for joining the WTO, an organization which was born as everyone remembers to fulfill the American objective in combating infringement and counterfeiting.
He adds that the grace period granted to developing countries including Jordan will expire by the year 2000 and that it cannot be extended further. The situation requires remembering quotations from the report of US Trade Representative Charlene Barshefsky which clearly points to the legal deficiency in the copyright law of 1992. It shows that protection is ineffective, and literary infringements exist, and that Jordan is trying to revise the law to improve it and make it consistent with the WTO requirements. Also, the law of inventions for the year 1952 doesn’t serve the sector of pharmaceutical manufacturers, which has many infringement problems. Service marks are still not protected in Jordan, which requires adjusting the law.
Mr. Abu-Ghazaleh draws attention to an information system known as the “universal information infrastructure” which is currently being prepared based on what was presented on July 7, 1997 by the American President and his Vice President Al Gore. This is a specified framework to establish a commercial electronic system through the internet that makes the entire world connected to an international network without requiring the essentials of a regular trade cycle. As such, taskforces were created to complete the financial considerations relating to taxes and payment procedures, in addition to the legal aspects of electronic trade, IPRs protection, confidentiality, the guarantee of security, procedures relating to opening markets and technical standards and communications.
There are two main principles that were decided upon by the General Agreement on Tariffs and Trade (GATT), which were the National Treatment principle and the MFN principle. These two principles make the nationals of all member-states equal in their rights and responsibilities under the umbrella of national laws, which cannot be violated under any circumstance. These principles also imply that if a bilateral agreement is reached between two countries that grant particular privileges to their citizens, then the citizens of other member-states must be entitled to these same privileges.
The only exception the treaty allowed was that relating to common markets, such as the European market, which grants its citizens special protection that the WTO recognizes. This is the reason for my calls in the past and present on the importance of completing the procedures necessary for a common Arab market, although it is now a weak weapon in the midst of the civilization divide between our countries –which still require technology transfer and knowledge- and those of the advanced world.
In the area of boosting IP elements, Abu-Ghazaleh explained that a trademark for a soft drink company is worth 36 billion dollars and results in generating 87% of the company’s profits. He added that 85% of the world’s inventions are owned by the seven industrialized nations. “Why?” he asks. “Because they possess a protective framework that preserves these inventions from being wasted or threatened. We are not an incapable nation. Rather, we are one whose sons have excelled in the olden days and invented for mankind. The European slumber in the fourteenth century didn’t stop time with the birth of new inventions and inventors and a system of protection. Reasonable protection is not dedicated for serving foreigners only, but is also fertile soil in which the imagination of local people flourishes as well.”
As for pirating, he said that this is a phenomenon which exists in advanced countries as well: “Globally, there are losses worth 700 million dollars as a result of this, with the rates I previously mentioned.
When talking about pirating or infringement, especially in the field of medicines, some Arab state laws in the area of inventions only protect the process and not the final product. This is what the TRIPS agreement, which the GATT is a part of, considered a legal deficiency that requires revision in order to protect both product and process combined.
In my view, there’s nothing wrong with this, because Arab pharmaceutical companies for example which we are proud of and proud of their accomplishments, either need to follow the path of legal licenses and purchase new technology by legitimate means, or need to try and build legitimate R&D centers they are involved in. Perhaps I agree with both methods combined because one cannot live in isolation from the rest of the world. The principles of the GATT seem to imply that the agreement should be looked at comprehensively as a whole and not at its individual elements only.”
Abu-Ghazaleh emphasizes the capability of the Arab nation for distinctive and ambitious work, innovations and invention, if the adequate opportunity is provided to it.
He pointed out to many efforts exerted by ASPIP such as translating the book “The GATT Guide” to the Arabic language based on a special agreement concluded with the WTO. He added “It is currently being printed in Switzerland and expected to be released soon. Other efforts include the convention of seminars and conferences to research the treaty at the Arab level and spread its concepts, suggestion of laws and systems relevant to protection in Arab countries and providing legal consultation to them while also holding training courses for governmental employees.”
Abu-Ghazaleh also listed many other activities of ASPIP such as:
Assisting Arab states in automating work utilizing computers for statements in protection offices, coordination and cooperation with each of the WTO and WIPO for obtaining the necessary information from them, and preparing a draft for an IP practitioner program in light of an agreement reached with the League of Arab States to host this educational activity that aims to graduate Arab IP experts.
Activities also include an IP dictionary which should be an efficient tool for people working in this field. The dictionary is in press in Europe. ASPIP is also issuing a magazine on IP protection as a specialized professional publication in the field and distributing it at the Arab level for all those interested, in addition to compiling current protection laws in Arab nations for release into a single book, and collecting court rulings issued in this area to be a legal reference for judges and attorneys.