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Intellectual Property Rights and National Development Goals

This study tour presentation provides an overview of intellectual property rights (IPRs) and their impact on innovation, with a focus on the TRIPS agreement and its implementation in Russia. It discusses the need for a balance between exclusive rights and competition, as well as the flexibilities provided by TRIPS. The presentation emphasizes the importance of considering the level of development when determining the appropriate level of IP protection.

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Intellectual Property Rights and National Development Goals

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  1. Intellectual Property Rights and National Development Goals – Ensuring Innovation in Russia St. Petersburg/Moscow Study Tour 2008 Christoph Spennemann, Legal Expert Intellectual Property Team Division on Investment and Enterprise UNCTAD

  2. Overview of presentation • Intellectual property rights (IPRs) and innovation • Multilateral IPRs: The TRIPS Agreement • IPRs and innovation • Striking a balance between exclusive rights and competition • IPRs & Innovation in Russia

  3. The TRIPS Agreement: Basic Principles • TRIPS objectives • Minimum standards of IP protection • Flexibilities in implementation

  4. TRIPS Objectives • IPRs should contribute to • The promotion of technological innovation; • the transfer & dissemination of technology; • to the mutual advantage of producers and users of technological knowledge • IP protection is not an end in itself, but one means to promote public policy objectives

  5. Minimum standards of IP protection • TRIPS provides for mandatory minimum standards of protection in most IP categories • In general, Members in domestic laws may not provide less protection than under TRIPS • Members may provide higher protection than under TRIPS

  6. Flexibilities in implementation • TRIPS obligations are drafted in general terms • Example: patents available for inventions that are new, inventive & industrially applicable (4 undefined terms) • In order to become operational on national level, most TRIPS provisions need further elaboration by domestic law makers • This leeway in implementation is referred to as « TRIPS flexibility »

  7. IPRs and Innovation (1) • IPRs: exclusive rights as incentives for inventors to invest in R&D • But innovation also needs competition • Competition as a main driver of product improvement • New ideas are mostly developed on the basis of existing know-how • « If I have seen farther, it is by standing on the shoulders of giants »

  8. IPRs and Innovation (2) • Governments must provide balance between need for IP protection and need for access by competitors to technology-related information (public domain) • TRIPS: leeway where to draw the line between IP-protected area and public domain • More exclusive rights  more innovation?

  9. Maximal innovation level Optimal protection level P Patents as a Policy MeasureProtection (P) vs.Innovation (I) Source: Swiss Federal Institute of Intellectual Property, October 2006 I Minimal protection level

  10. Striking a balance (1) • Where is the optimal protection level to reach maximum of innovation? • Historical evidence: no «one-size-fits-all» model (Europe, USA, Rep. Korea) • Early stages of technological development require broad public domain for indigenous learning • Advanced stages of development require higher level of protection of technological assets • Even technologically advanced economies depend on competition and follow-on innovation

  11. Striking a balance (2) • US Federal Trade Commission (FTC) in 2003 Report: • «Questionable Patents Are a Significant Competitive Concern and Can Harm Innovation» • Patents granted for trivial inventions block access to know-how needed for competitive product improvement

  12. Striking a balance (3) • FTC Report example from computer industry: • 90,000 different patents on microprocessors • Patents held by more than 10,000 parties • Many of these patents overlap  each patent blocks several others • Result: dense web of overlapping patents («patent thickets») • Companies seeking to commercialize technology have to pay considerable licensing fees or challenge blocking patents in costly & lengthy litigation

  13. Striking a balance (4) • Balance between IP protection and availability of essential information is also needed in various areas of public policy • Health (access to affordable medicines) • Biotechnology (use of genetic research tools) • Education (access to scientific materials) • Food & agriculture (food security & preservation of biodiversity)

  14. IPRs & innovation in Russia • WTO Accession: bilaterally negotiated standards often provide stronger protection for inventors/creators than TRIPS • Reduction of public domain/competition/follow-on innovation • National costs & benefits depend on technological level of domestic industry: careful assessment of strengths & weaknesses required • Expansion of bilateral standards through MFN rule

  15. Conclusions • IPRs: traditional means to promote domestic technological development • No «one-size-fits-all» model: level of IP protection needs to reflect particular level of development • IPRs must not be too broad to prevent competition and follow-on innovation • TRIPS provides flexibilities for these purposes • Policy makers need to be aware of TRIPS flexibilities • Benefits of TRIPS-plus standards depend on domestic industry’s technological capacity

  16. Contact Christoph Spennemann Legal Expert Intellectual Property Team Division on Investment and Enterprise (DIAE) UNCTAD E-mail: Christoph.Spennemann@unctad.org Tel: ++41 (0) 22 917 59 99 Fax: ++41 (0) 22 917 01 94 http://www.unctad.org/tot-ip

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