CHAPTER3.

CLEAR AND PRESENT DANGER FROM ACTA

The Indo-E.U. Trade dispute over the seizure of 'in-transit' Indian generic drug consignments
at various ports in the Netherlands has lent a sense of antagonism to the entire debate against
ACTA. Now, apprehending similar measures could be directed under the treaty several other
countries have started filing requests to join the consultations on the dispute.
Canada has a substantial trade interest in these consultations, as it exports 40% of generic
drugs manufactured in Canada to over 120 countries. Canada is also an active WTO Member
on the issue of public health, including access to medicines. Certain shipments of generic
drugs destined for Ecuador were seized in transit in the territory of the European Union in
2008 and 2009. Ecuador is also concerned that these measures could adversely affect the
shipment of drugs destined for Ecuador in the future.
Brazil imports significant amounts of generic medicines, including from India; Brazil is also
an exporter of generic medicines. More specifically, one of the drug seizures listed in India's
consultation request affected a consignment of medicines bound for Brazil. In addition, Brazil
requested consultations with the European Union under the DSU on similar measures.4
The wider Indian fears about ACTA are that similar multilateral and plurilateral treaties
incorporating harsher TRIPS plus measures are being interned by many countries into their
national legislations.
The underlying misgiving about the ACTA provision which is now confirmed to be more
than mere apprehensions is that the most of the provisions of ACTA are being written under
the dictation given by multinational corporations who seek to guard their falling revenues in
developing markets.
The dangerous trend is that since it unnecessarily upsets the balance of rights as set out in the
TRIPS provisions and undermines important decisions on IP protection and enforcement such
as the Doha Declaration on Public Health in WTO and the Development Agenda in WIPO.5
CONCLUSION
The Government of India has taken a strong stand against ACTA at international fora,
including the WTO. A paper submitted to the WTO in June 2010 by India states “They
[ACTA proposals] represent a systemic threat to the rights of legitimate traders and producers
of goods, and fundamental rights of due process of individuals.” India has also pointed out
that ACTA proposals break the “careful balance of the interests of the right holders on the
one hand, and societal interests, including development-oriented concerns on the other”6.
This position needs to be rigorously promoted and defended.
There have been positive signs of support pouring in from other similarly aligned nations
such as China, Brazil, and South Africa etc. Apart from working collectively with these
4 http://spicyipindia.blogspot.com/search/label/ACTA?updated-max=2009-02
20T13%3A09%3A00%2B05%3A30&max-results=20, visited on 10/9/2010
5 http://spicyipindia.blogspot.com/search/label/ACTA?updated-max=2009-02-
20T13%3A09%3A00%2B05%3A30&max-results=20, visited on 10/9/2010
6 Editorials, Patently Dangerous, Economic &Political Weekly, June 26,2010

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100
countries, we need to develop our independent foreign policy on such contentious issues
which has been lacking over the years. Then, of course, there can be no united front against
such issues when there could be no consistency in our approach.
The issue of 'ceilings', was raised by the Indian delegation when it noted that 'in addition to
laying certain minimum standards, TRIPS Agreement also provides „ceilings‟, some of
which
are mandatory and clearly specified in the TRIPS Agreement'. Essentially, they contend that
enforcement levels must be maintained in accordance with the Objectives and Reasons for
TRIPS and must not contravene its provisions under any circumstance.
The impediments to legal processes, an adverse impact on competition, potential trade
barriers and increased cost of IP enforcement for private commercial rights. Article 41.5 of
TRIPS states that no government is obligated to allocate equal resources towards IP
protection (private rights) and other laws in general. TRIPS-plus provisions contained in the
ACTA run contrary to it.
Cross-referencing (like in the EU-CARIFORUM agreement) mandates non-negotiating
ACTA nations to implement ACTA provisions as well, which is a serious cause for worry.
The Caribbean countries would find it increasingly difficult to account for the escalated cost
of enhanced IP enforcement mandated by the ACTA provisions.
The seizure of goods as an issue was repeatedly mentioned by Indian officials even before the
TRIPS Council meeting, since it involves a question of whether customs officials can seize
good in-transit, “suspected” of infringing trademarks, copyrights and other IPR's. The
standard for determining a 'prima facie' case warranting infringement that would inevitably
attract a seizure has been made so low that it goes against the TRIPS sentiment.
With the „in-transit‟ provisions, IPR holders can demand seizure of goods by custom
authorities without judicial intervention, which are contrary to TRIPS provisions (except in
the case of copyright piracy and TM counterfeiting). It ignores fundamental due process
issues such as knowledge standards, evidentiary requirements, competent investigation
authorities and time-frames. The Indian delegation has voiced its concerns in the words that it
produces a 'general shift in the locus of enforcement which enhances the power of IPRs
holders beyond reasonable measure' and significantly curtails the ability of an accused
infringer to defend ordinary claims of infringement.
A FICCI paper has referred to an EU study on ACTA, which opined that there would be an
infringement, if a medicine or product is made for which a company holds a patent in any
country irrespective of the lack of clarity involved in the scope and validity of the said patent.
Following the same line of argument, production of spare parts may also violate an
unexamined design right with unclear scope and validity.7
This document on ACTA cites the decision of the US Supreme Court in eBay Inc v. Merc
Exchange wherein the US Supreme Court has discussed the effect of grant of interim reliefs
on public interest. The Court has observed that an interim relief is effectively used as a
bargaining tool when the terms of a license are negotiated with the infringer and that the
threat of an interim relief could help a right-holder in unduly gaining an upper hand in the
negotiations.
7 www.spicyipindia.blogspot.com/2010/05/in-acta-india-does-not-trust.html, visited on 10/9/2010
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101
Further, the US Supreme Court asks Courts to wake up to the possibility of interim reliefs
granted to broadly-worded patents acting as stumbling blocks to advancement of public
interest. Therefore, the Court has advocated grant of damages over interim injunctive relief,
where appropriate.
In one‟s opinion, there‟s another way of looking at this. On one hand, while it is true that
enforcement standards advanced by and through ACTA may not be in the best interests of all
countries which are at various stages of development, it is also true that unless and until
enforcement is given its due, the State is merely doling out paper tigers in the form of IP
rights which at the end of the day add nothing to the balance sheet of a right-holder but
costs.8
The signing members of ACTA seem to have miscalculated the increasing importance
of developing nations, especially the BRIC countries, within international organizations. The
declining strength of the US and Europe in global institutions such as the WIPO is all too
clear, and with countries such as Argentina, Brazil, China and India mustering strength at
international fora and realizing the need for liberal IP regimes. There appears to be a serious
impediment in the plans of the United States to simply dole out membership invitations to
ACTA and expect passive acceptance.9
Only recently Indian foreign trade minister had some achievement to boast about as the
government managed to settle the case of confiscation of 17 consignments of off patent drugs
by European Union.10 The seizures were made by EU over last couple of years while the
trade consignments were en route to various African and Latin American countries. As per
settlement, India withdrew its complaint on the issue that was filed by it with WTO wherein
it claimed the impugned action of EU as the violation of multilateral international trade
principles.
So far so good but last word is far from being heard on the ACTA issue and the government
of India will be better advised to use the said settlement to strengthen its case against the
treaty which if passed in its present form will allow EU and other countries to go about such
seizures with utter impunity and disregard for any of the developing nations‟ woes
SUGGESTIONS:
India should cooperate with other countries such as China, South Africa, Brazil, who
share similar concerns regarding ACTA.
Indian diplomatic front should be ever so vigilant and not let itself dragged into
economically impotent agreements just for the sake of elusive geopolitical gains.
India should open up its markets in critical areas requiring investments for their
survival like import of oil seeds as a part of multilateral initiative.
Push for technology transfer agreements with the western countries in order to let the
industries become more competitive.
The fledgling and vitally important market for generic medicines in India should be
protected with intellectual property safeguards.
8 http://spicyipindia.blogspot.com/2010/05/acta-new-culture-of-damagesfor-who.html, visited on 10/9/2010
9 http://spicyipindia.blogspot.com/2010/04/guest-post-acta-text-released-impact-on_29.html ,visited on
10/9/2010
10 Drug seizure issue settled, EU agrees to amend laws
The Economic Times, Oct 08, 2010 , http://www.ficci.com/ficci-in-news-page.asp?nid=4370, visited on
10/26/2010
102
BIBLIOGRAPHY:
1. Parthapratim Pal, “Regional Trade Agreements and the Improved Market Access in the
Developing Countries-the Evidence”, Economic &Political Weekly, November 29, 2008.
2. Udit Misra, N. S Ramnath, “Indian Markets-Open Sesame”, Forbes India Magazine,
August 27, 2010.
3. „US Wants More from Investment Deal‟, The Economic Times, April 28, 2008.
4. Pascal Lamy, Proliferation of regional trade agreements “breeding concern”, September
10, 2007, http://www.wto.org/english/news_e/sppl _e/sppl67_e.htm.
5. Bhagwati, J and A Panagariya, The Economics of Preferential Trade Agreements, (1996),
AEI Press, Washington DC.
6. Editorials, Patently Dangerous, Economic & Political Weekly, June 26, 2010.
7. Joost Pauwelyn, The Transformation of World Trade http://www.jstor.org/stable/30044497
visited on 9/29/2010
8. http://spicyipindia.blogspot.com/search/label/ACTA?updated-max=2009-02-
20T13%3A09%3A00%2B05%3A30&max-results=20
9. http://spicyipindia.blogspot.com/search/label/ACTA
10. http://www.techeye.net/internet/india-to-sabotage-acta
11. Drug seizure issue settled, EU agrees to amend laws,
The Economic Times, Oct 08, 2010, http://www.ficci.com/ficci-in-news-page.asp?nid=4370,
visited on 10/26/2010