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on Trade-Related Aspects of Intellectual Property Rights
as concluded on April 15, 1994
ENTRY INTO FORCE: January 1, 1995





I. Trade-Related Intellectual Property Rights. A New Regime

The Trips Agreement negotiated during the Uruguay Round sets minimum standards on certain intellectual property rights.

In accordance with Article 1, countries are free to determine the appropriate method for implementing the Trips Agreement within their own legal system and practice.  The Trips Agreement requires that the nationals of any country member of the Trips Agreement are to be treated in the same way as nationals of the country where protection is granted. It also extends to any member the advantages granted to any other member or members. These principles are meant to end discrimination, both between foreigners and nationals and between nationals of different countries, which arises when IPRs are granted only to the nationals of the country that pressed for them .

Article 6 allows member countries to provide for the international exhaustion of rights and, therefore, to admit parallel imports if they so wish.  This principle can be crucial for the protection of consumers interests and for ensuring access to industrial or agricultural inputs (if protected by IPRs) at competitive prices.

Two other important principles are established in Article 8 of the Trips Agreement, which states:

1. Members may, in formulating or amending their laws and regulations, adopt measures necessary to protect public health and nutrition, and to promote the public interest in sectors of vital importance to their socio-economic and technological development, provided that such measures are consistent with the provisions of this Trips Agreement.

2. Appropriate measures, provided that they are consistent with the provisions of this Trips Agreement, may be needed to prevent the abuse of intellectual property rights by right holders or the resort to practices which unreasonably restrain trade or adversely affect the international transfer of technology.

These provisions of Article 8 facilitate legislating limitations to exclusive rights, as well as the enactment of legislative provisions concerning the compulsory licensing of certain IPRs.  In particular, the grounds mentioned in Article 8.1 are relevant for the granting of compulsory licences in for example the pharmaceutical field in order to keep prices at a reasonable level or to ensure access to particular medicines by the population. However, Article 31 of the Trips Agreement sets out conditions which could reduce the scope to grant compulsory licences.

Specific provisions

In the copyright area, the Trips Agreement makes express provision for the protection of software as a literary creation and for the first time in an international Trips Agreement provides rental rights for sound records, films and computer programs as well as for the protection of data compilations. It establishes a minimum term of protection for works not belonging to natural persons: 50 years from publication or from creation (if publication was not made within 50 years from the making of the work). Enforcement rules are strengthened by the obligation to institute criminal proceedings and to prescribe penalties against copyright piracy on a commercial scale.

The protection of trademarks will be substantially harmonized and reinforced as a result of the application of the Trips Agreement, which defines in considerable detail what signs may be protected and the minimum term of protection. It also sets out the minimum permissible period of non-use and the possibility of justifying this by valid reasons based on the existence of obstacles (Article 19). The Trips Agreement supplements the Paris Convention with regard to the protection of `well-known’ trademarks and blurs in practical terms the distinction between trademarks for goods and for services.

Under the Trips Agreement, the protection of geographical indications, which hitherto was granted in a small number of countries, is now required of all members of WTO. Reinforced protection is accorded in respect of wines and spirits. The implementation of the Trips Agreement will not, however, affect prior users of geographical indications of other members that become protectable under the Trips Agreement, if the conditions specified by the Trips Agreement are fulfilled.

New or original industrial designs need to be protected for at least 10 years. The obligation refers to designs of an aesthetic nature, since countries are not obliged to protect designs dictated essentially by technical or functional considerations.
A crucial chapter of the Trips Agreement relates to patents. Until now, countries were free to determine areas of non-patentability, the duration of the terms of patents and the set of exclusive rights conferred on patent-holders. This freedom which was used by developing countries to frame their patent laws in accordance with their own objectives and interests no longer exists under the Trips Agreement. Patents are to be granted without discrimination as to the place of invention, the field of technology or whether products are locally produced or imported. The Trips Agreement thus settles the longstanding conflict over pharmaceutical product patents, which, under the Trips Agreement, now need to be recognized. For biotechnological inventions, nevertheless, and as a reflection of the complexity and still unresolved differences even among developed countries on the issue, the Trips Agreement only provides for a transitional solution which is to be reviewed within four years of the date of the Trips Agreement.

The text of the Trips Agreement sets out the rights to be conferred under a patent, including the protection of a product directly made with a patented process, and an exclusive right to produce, sell and import the protected product.

The reversal of the burden of proof is stipulated for process patents in order to strengthen the patentee’s position in civil cases of infringement, but with the proviso that the product is new or, alternatively, that there is substantial likelihood of infringement which could not be proven despite reasonable efforts by the title-holder.

Furthermore, detailed rules are set out limiting the conditions but not the grounds on which compulsory licences may be granted. Compulsory licences must be non-exclusive and subject to a remuneration to be paid to the patentee, as well as to other conditions. However, there are no specific provisions concerning the grounds on which such licences can be granted. Specific reference is made to the dependency of patents; to licences for governmental non-commercial use; to cases of emergency use and to remedy anti-competitive practices. But licences may be granted also for other reasons. Thus, nothing in the Trips Agreement prevents, in effect, the granting of compulsory licences for reasons such as public interest, public health or environmental protection, subject to the conditions set out in the Trips Agreement. The Trips Agreement further allows national legislation to determine the rights that can be exercised by the licensee, including production or importation. Lastly, the minimum patent lifetime is stipulated as 20 years, counted from the filing date.

In this area, compliance with the basic obligations of the Washington Treaty is provided for.  Though the Treaty authorizes the protection of the layout design of integrated circuits through copyright, patents or other titles, the Treaty follows the sui generis approach that was first adopted by US legislation and later on followed by Japan and European countries.  The Trips Agreement reinforces the protection granted under the Treaty, by limiting the availability of compulsory licences and by imposing obligations on even bona fide acquirers of semiconductors who infringe rights.

Under the Trips Agreement, trade secrets such as confidential know-how or commercial information are deemed protectable under the rules regarding unfair competition and Article 6 [bis] of the Paris Convention.  In addition, obligations are recognized in relation to test results and other data submitted to governments in order to obtain approval of pharmaceutical and agrochemical products. The Trips Agreement stipulates that such tests and data must be protected against unauthorized disclosure and unfair commercial use.

Restrictive practices in licensing Trips Agreements

The Trips Agreement allows member countries to control and ban restrictive practices provided for in licensing Trips Agreements that in particular cases constitute an abuse of intellectual property rights with an adverse effect on competition.  The Trips Agreement thus introduces the competition test for the purpose of verifying and curbing the use of restrictive clauses, as proposed by industrialized countries during the long and unsuccessful negotiations under UNCTAD auspices on an international code of conduct for the transfer of technology.


The Trips Agreement also contains detailed provisions regarding judicial and administrative procedures and other measures related to the enforcement of rights, as well as specific rules for preventing trade in goods bearing false trademarks and in pirated works which infringe copyrights. The enforcement part of the Trips Agreement constitutes a major innovation as compared to previous international conventions on the matter, which dealt exclusively or mainly with the availability of rights and not with procedures for exercising them.

Dispute settlement

The provisions of the Trips Agreement as such cannot be the direct and sole basis of a claim by a private party, that is, it has not been conceived as a self-executing instrument. An action which charges non-compliance with the rules of the Trips Agreement can only be taken by other WTO members and not by individuals or firms.

Non-compliance with the new rules, once adopted, would give rise to a dispute settlement procedure under the WTO rules and, possibly, to retaliatory commercial measures in any field by the country whose nationals are affected by such non-compliance. Since, within the WTO, adherence to the new IPRs universal standards will be monitored by the Council for TRIPs, the possibility of deviations from those standards is drastically reduced, unless a non-complying country is prepared to bear the costs of any trade restrictions that may be imposed.

The new WTO “Understanding on Rules and Procedures Governing the Settlement of Disputes” provides a limited time frame and considerable automaticity for the settlement of disputes. It creates a Dispute Settlement Body (DSB) composed of all WTO members and stipulates a `negative consensus’ rule for the establishment of panels, the adoption of their reports and the authorization of retaliatory measures. Such a rule means that the panel process will be instituted if at least one country favours this course.

The adoption of this Understanding also means that unilateral actions, such as action under section 301 of the US Trade Act, cannot be imposed before the DSB has verified the existence of a case of non-compliance and authorized retaliatory action. Any unilateral action taken before or outside such a procedure would be illegal under the WTO Trips Agreement.

Transitional provisions

Finally, the Trips Agreement contains provisions that allow developing countries to delay complying with any or all of the Trips Agreement’s obligations for up to five years from the date of entry into force of the Trips Agreement. An additional five years is allowed in the case of countries which did not grant product patents before entry into force of the Trips Agreement but which now have to do so under the terms of the Trips Agreement.18 The least-developed countries may delay implementation for up to 11 years. This term may be extended by the Council for TRIPs upon request setting out the reasons.

Technical co-operation
Developed countries members of WTO are obliged, under Article 67 of the Trips Agreement, to provide “technical and financial co-operation” in favour of developing and least developed countries to facilitate the implementation of the Trips Agreement. Such co-operation, which is to be provided upon request and on mutually agreed terms and conditions, includes assistance in the preparation of laws and regulations, support for domestic offices and in the prevention of abuse of IPRs.

This obligation on the part of developed countries, if not adequately fulfilled, may be the subject matter of a claim before the Council for TRIPs, as in the case of any other obligation defined by the Trips Agreement.

Review of the Trips Agreement in the WTO

The Trips Agreement is to be reviewed for the first time five years from the date of its entry into force, and at two-yearly intervals thereafter (Article 71). The Council for TRIPs may also undertake reviews when new developments warrant modifications.