According to this report, “The World Trade Organization agreed to extend the [TRIPS compliance] deadline [for least developed countries] by seven years until July 1, 2013 to give struggling economies more “flexibility” in developing protections for patents, copyrights and other intellectual property. ” Here is the WTO press release. And here is coverage by the IP Watch. This is an important although expected development. As I noted here (note 412):
A similar dynamic [as occurs in the Ozone regime] may be taking place in the WTO regime in the context of TRIPs. The long-term success of IP harmonization, which is something the developed nations strongly desire, depends on the participation and compliance of developing countries. Arguably, developing nations are in a relatively strong position to hold-out because they have credibly short time horizons (due to domestic priorities) and also, at least in some cases, lack the capacity to comply fully. Developing countries may hold-up developed countries for side-payments in the form of readjusted commitments (extended deadlines, relaxed standards for compliance, etc.), additional trade concessions, and financial and technical assistance, among other things.
Without getting into details too much, this illustrates how international legal regimes evolve over time and how States sometimes manage (rather than enforce) compliance. In this article, I describe the adjustment of commitments as a Type III compliance strategy:
States may adopt Type III strategies by incorporating institutional mechanisms for dynamically adjusting commitment levels, payoff structures, or other institutional features. Once commitments are undertaken and an expected payoff structure is in place, States may find it necessary to do more than reward compliance or punish noncompliance. The underlying commitments may need to be relaxed, made more stringent, or changed completely depending on the circumstances. Particularly where the number or identity of participants is important or where the expected benefits of cooperation in future rounds outweigh comparable benefits in a current round, parties may prefer to forgive a party’s noncompliance and readjust the party’s commitments in a manner that improves the likelihood that it will comply in the future.
Notably, such mechanisms are not always responsive to concerns over opportunism. States may create institutions to facilitate the adjustment of commitments (or other aspects of the agreement) f or the purpose of attaining collective goals without having to reform a new agreement. Such adjustment may be accomplished through structured bargaining conventions, as in the case of ratcheting down tariffs in the GATT/WTO regime, or through institutional mechanisms delegated authority to adjust commitments in a less formal manner, as in the case of ratcheting up production and consumption limitations for ozone-depleting substances. Interestingly, as discussed below, both the GATT/WTO system and the Ozone regime work toward their respective goals of liberalized trade and significantly limited consumption of ozone-depleting substances by successive ratcheting of commitments made possible through institutional mechanisms. In both cases, the parties anticipated dynamic change and chose to participate in an evolving game rather than a series of iterated games.
Furthermore, beyond adjusting commitment levels, States may wish to modify existing institutions or create new ones as necessary to respond to unforeseen developments. Of course, States may hesitate to delegate the power to make such “adjustments” as a general matter, but they also may hesitate when contemplating the prospect of repeated multilateral negotiations over institutional details, particularly in an issue area where States expect a significant degree of dynamic change and the expected bargaining costs are high.
The decision to extend the deadlines for compliance was made by the WTO’s Council for Trade-Related Aspects of Intellectual Property Rights (the TRIPS Council), which may be the most important compliance institution in the WTO framework for ensuring TRIPS compliance. As I argued at the very end of the Buffalo Law Review piece:
[I]t is not clear whether the DSU will even be the most important compliance institution for the long-term success of TRIPs. While the DSU is helpful in the sense that it clarifies obligations and identifies whether a country’s domestic implementation is in compliance with TRIPs, the primary compliance issues that are likely to arise in the TRIPs context, at least with respect to developing countries, will either be (1) capacity-based: a country lacks the resources, expertise, legal infrastructure, etc. to comply, or (2) intent-based: a country lacks the incentives to devote domestic resources towards compliance because compliance with TRIPs is a relatively low priority or is viewed with reluctance. The DSU is not well-suited to address either of these problems. Perhaps more importantly, there may be a strategic opportunity for developing countries to force renegotiation of concessions. To the extent that this assessment of likely compliance issues is accurate, the TRIPs Council, which is charged with “monitor[ing] the operation of [TRIPs],” and capacity-building institutions are likely to be equally if not more important than the DSU in securing meaningful compliance over the long-term.
The deadlines were not extended as much as LDCs requested. They collectively requested an extension of 15 years, but stiff opposition from the United States and other developed countries forced a reduction to 7 years. As the decision notes in paragraphs 2-4, the extra time is intended to facilitate capacity building through “targeted technical and financial cooperation programmes.”