Review of the Provisions of Article 27.3.(b) – Communication from India

Council for Trade-Related Aspects of Intellectual Property Rights (99-4755)
Original: English

The following communication, dated 20 October 1999, has been received from the Permanent Mission of India,

• Patents are one of the seven intellectual property rights protected under TRIPS Agreement. It requires Member countries to make patents available for any inventions, whether product or processes, in all fields of technology without discrimination, subject to the normal tests of novelty, inventiveness and industrial applicability. It also requires that patent be available and patent rights enjoyable without discrimination as to the place of invention and whether products are imported or locally produced. Of course, patents and patents rights have a territorial application i.e. patents granted under a particular national law can be enforced only within the territorial jurisdiction of that country.
• There are some general exceptions to the basic rule on patentability contained in Article 27. One is for inventions contrary to ordre public or morality. This also includes inventions dangerous to human, animal or plant life or health or which seriously prejudice the environment. The use of this exception is subject to the condition that the commercial exploitation of the invention must also be prevented. Secondly, Members may exclude from patentability diagnostic, therapeutic and surgical methods for the treatment of humans or animals.
• A review of clause (b) of paragraph 3 of Article 27 of the TRIPS Agreement is due in the year 1999. This part of the Article states as under:
  “Member may also exclude from patentability:
  (b) Plants and animals other than microorganisms, and essentially biological processes for the production of plants or animals other than non-biological and microbiological processes. However, Members shall provide for the protection of plant varieties either by patents or by an effective sui generis system or by any combination thereof. The provisions of this subparagraph shall be reviewed four years after the entry into force of the WTO Agreement.”
• The review could perhaps encompass three distinct but overlapping dimensions of Article 27.3. Firstly, it may be a subject of review whether and what form of exclusion from patentability should apply to plants and animals per se (patenting of lifeforms). Secondly, the review could consider the effect of protection granted to microorganisms and non-biological and microbiological processes (scope and definition of microorganisms). Thirdly, it would be reviewed whether and what form of protection of plant varieties through sui generis systems is an effective form of protection (effectiveness of plant variety protection).
• The TRIPS Council had initiated an information gathering exercise by inviting Members to provide information on how the matters addressed in this provision were presently treated in their national laws. Developed country Members were to provide this information as they are already under an obligation to apply this provision, while others could provide information on a best endeavour basis. The information received was incomplete, as a majority of Members, having yet to take on obligations under this provision, had no information to give. The information received was also incomplete as it related primarily to the way developed countries were treating implementation of Article 27.3 (b) in their laws. It is clear from the proposals made in the communication of Kenya on behalf of the African Group in the General Council (Document No. WT/GC/W/302) that the information made available so far by Members does not represent the practices of the Membership. The various proposals made by Members in the General Council regarding review of the TRIPS Agreement, including the review of Article 27.3 (b), also show that the review of this Article is a substantive review of the provisions in the Article and not a review of the operation of the Article. Therefore, this paper discusses the three aspects of the review mentioned in paragraph 4 above.

• Patenting of lifeforms may have at least two dimensions. Firstly, there is the ethical question of the extent of private ownership that could be extended to lifeforms. The second dimension relates to the use of the IPRs concept as understood in the industrialized world and its appropriateness in the face of the larger dimension of rights on knowledge, their ownership, use, transfer and dissemination. International IPR regimes recognize formal systems of knowledge only. Informal systems e.g. the shrutis and smritis in the Indian tradition and grandmothers’ potions all over the world get scant recognition. To create systems that fail to address this issue can have severe adverse consequences on mankind, some say even leading to our extinction.
• Clearly, there is a case for re-examining the need to grant patents on lifeforms anywhere in the world. Until such systems are in place, it may be advisable to:-
  • exclude patents on all lifeforms; If this is not possible, then
  • exclude patents based on traditional/indigenous knowledge and essentially derived products and processes from such knowledge; or at least
  • insist on disclosure of the country of origin of the biological resource and associated knowledge, and obtain consent of the country providing the resource and knowledge, to ensure equitable sharing of benefits.

• As regards micro-organisms, the discussion would focus on the scope of patentability of micro-organisms and non-biological and microbiological processes. There are many grey areas in defining the scope of patentable microorganisms and microbiological processes multilaterally. The WTO could consider various dimensions of this in these discussions. The first is the difference between discovery and invention – only the latter should be patented. For example, patent on Steptomyces Vioaceus a micro-organism accessed from the soil in Hyderabad, India (Patent No. 4992376), granted by US PTO in 1991, to Bristol Myer would not be a valid patent. The second dimension is the patentability criteria. Article 27.1 provides that patents shall be available for any inventions provided they are new, involve an inventive step and are capable of industrial application. Thus the criteria of novelty, non-obviousness and usefulness have to be satisfied before the grant of patent. The third dimension is the coverage of micro-organisms under the Article. The Article requires patenting of microorganisms, non-biological and microbiological processes. This would mean that perhaps a microorganism which is a manmade, genetically-engineered bacterium, would meet the test of patentability. Another question is the patentability of biological material such as cell lines, enzymes, plasmids, cosmids and genes. It appears that these will not qualify as inventions unless there is human intervention involved and unless they fall in the category of micro-organisms. In cases where the biological material is also a chemical, as in the case of artificial enzymes, they could be patentable as chemicals. As for other biological material, it is felt that since plants and animals are excluded, parts would also be excluded. Thus a gene cannot be patented except if it also qualifies as a micro-organism that is patentable under the national law. National laws vary considerably on this issue. Therefore, it should be left to national policy to decide what are patentable micro-organisms.
• The Article clearly excludes essentially biological process for the production of plants and animals. It may be pertinent to note that micro-organisms or not, some inventions could be excluded from patentability for other reasons given in the TRIPS Agreement. These reasons are given in Article 27.2 of the Agreement and include ordre public, morality, human, animal or plant life or health and environment. Thus, many of the fears arising out of possible adverse consequences of patenting of micro-organisms can be allayed through proper national laws using these exceptions and through effective examination of patent applications in this area. This is all the more reason why scope of patentability of micro-organisms should be left to national policy.

• Article 27.3(b) stipulates protection of plant varieties either by patents or by an effective sui generis system or by any combination thereof. It is therefore abundantly clear from a plain reading of the language that patents are only one of the possible options available to countries for providing protection of plant varieties. Clearly, other options available are: either a sui generis system that is effective or any combination of these two. Thus, we believe wide latitude has been given to countries for developing an effective means of providing for protection of plant varieties. Obviously, in devising such a system, a country may be expected to take into account its own public policy objectives including developmental and technological objectives (clearly recognized in the TRIPS Agreement) and also the obligations that the country has undertaken in the context of the TRIPS Agreement and other international Agreements. In view of this, the TRIPS Agreement is right in leaving it to the Member concerned to decide what system it would like to choose for providing protection of plant varieties in accordance with its own legal system and practice.
• The UPOV Convention is considered by some to provide one set of models. The UPOV Convention is derived from the need to protect the interests of plant breeders in industrialized countries; it does not derive from the needs of users in developing countries. However, the 1978 Act of UPOV allows the recognition of farmers’ privilege to resow farm-saved seeds. The FAO Commission on Genetic Resources for Food and Agriculture is currently recasting its International Undertaking on Genetic Resources for Food and Agriculture, 1983. That could provide another set of models. Certain national or regional laws based on a combination of plant variety protection and the conservation of biological diversity also could be used as effective models. Thus there are various ways to develop an effective sui generis system of protection of plant varieties. There is no reason why countries cannot develop their own models, which are effective sui generis systems under the TRIPS Agreement.
• Some broad suggestions for creating a sui generis system that is effective under the TRIPS Agreement but also caters to environmental concerns could be discussed during the review. One suggestion could be to ensure that implementation of obligations under the Convention on Biological Diversity regarding its preservation and its benefit sharing should not be considered a dilution of the effectiveness of the system. Another is to give full consideration to environmental and ethical concerns about intellectual property rights on lifeforms as discussed above. Still another is to ensure that a system considered effective should also promote food security and health security. It would be essential to ensure that preservation of farmers rights would not be considered as a dilution of effectiveness of the system. Finally, what is an effective sui generis system may be best left to each Member to evolve in its legal system and practice.

• The paper is intended to identify the scope of the review of Article 27.3 (b) and highlight some of the important suggestions made nationally as well as internationally in various discussions on the subject that have taken place since the coming into force of the TRIPS Agreement. It is neither intended to be an exhaustive treatise of the concerns on the review nor is it intended to limit the scope of review to the suggestions mentioned therein. The paper is intended to introduce the subject and suggest a possible road map for the review.
• In conclusion, it is submitted that developing countries like India cannot accept any further strengthening of the protection provided to lifeforms at present. Developing country laws in this area are still being developed. It may take some more time for developing countries to acquire experience on the level of protection necessary and desirable as well as the exceptions and balances necessary for ethical, social and economic needs of their peoples. Perhaps it may be beneficial to wait till such experience is acquired before debating the extent of protection of intellectual property rights in this area. In fact, it may be ideal to exclude patent protection for lifeforms from all national laws until such time. Until then, it may also not be advisable for the WTO community to assess the implementation of obligations in this area.