The TRIPS Agreement aimed not only at protection of the Intellectual Property rights but their due

enforcement as well. The Agreement, thus, sets out minimum standards to be established and also
provides for the administrative and civil mechanisms for enforcement. These minimum standards for the
enforcement of IPR allow right holders to protect their legitimate interests through civil courts or
administrative proceedings. However, considering the innovations in technological fields, increased
patent filing, new symbols being created everyday and works requiring copyrights, IPR enforcement
needs to be strengthened further.

Why IP Protection?

IP rights are exclusive rights given to the creator of an innovation for a fixed period of time during which
reproduction of the said work without the permission of the innovator or owner attracts liability.

IP rights are given by the society through the State to its subjects as incentive to disseminate and
produce such ideas that benefit the society as a whole. These rights are not like Fundamental Rights
guaranteed in the Constitution but Statutory rights enacted by the law making authority of the country.

What is The Background Of The TRIPS Agreement?

Bretton Woods was the first agreement to be reached upon in 1944 by various countries to govern the
International Monetary policy. It created two institutions (also known as Bretton Woods Institutions)
namely International Bank for Reconstruction and Development (IBRD) in 1945 and International
Monetary Fund (IMF) in 1946. Subsequently the General Agreement on Tariffs and Trades (GATT) was
established in 1947 to harmonize world trade.

Until the establishment of World Trade Organisation (WTO) in 1995, GATT was the only multilateral
instrument governing world trade since 1948.A total of eight rounds of negotiations were held under
GATT out of which first five rounds concentrated exclusively on tariffs while the sixth round included
discussions on anti-dumping measures as well which included provisions for member nations to control
the dumping of goods by other nations into their territory which can affect the member nation’s
economy. The last GATT round was the Uruguay Round (1986-1994). It was this round when for the first
time discussions were held on trade related to agriculture, services and IPR. After long discussions and
complex negotiations, finally in 1994, WTO was established in 1994 and became effective from 1st
January 1995. All the 123 nations that participated in the Uruguay Round became the members of WTO
including India. At present there are 153 members of WTO i.e. almost 90% of World’s nations. WTO is
responsible for the negotiation and implementation of new trade agreements. It is also in charge of
ensuring strict adherence to the trade agreements signed by majority of the world’s trading nations.

One of the most important agreements of WTO is the TRIPS Agreement. This Agreement came into force
on 1st January, 1995. The TRIPS Agreement (forthwith referred to as ‘the Agreement’) is an International
agreement administered by WTO and it sets down the minimum standard for many forms of intellectual
property regulations. The Agreement is till date the most comprehensive agreement of a multilateral
nature on IP. Following areas of Intellectual Property are covered under the Agreement:
  Copyrights and Related rights (like the rights of performers, producers of sound recordings and
broadcasting organizations)
 Trademarks (also service marks)
 Geographical Indications (including appellations of origin)
 Industrial Designs
 Patents (including protection of new variety of plants)
 Layout-designs of Integrated Circuits
 Undisclosed Information (Trade secrets and Test data)

The Agreement is a seven-part document containing complex provisions with respect to Intellectual
Property rights. Following is a brief description of the structure of the Agreement:

Part I: The general provisions and the basic principles of National Treatment and Most Favoured Nation
are covered under this part. (Article1 to Article8)

Part II: The standards concerning availability, scope and use of Intellectual Property Rights is covered
under this part. (Article9 to Article40)

Part III: This part deals with the enforcement of IPRs. (Article41 to Article61)

Part IV: This part addresses the provisions for acquiring and maintaining IPR. (Article62)

Part V: This part deals with prevention and settlement of disputes arising out of the provisions of the
Agreement. (Article63 to Artcile64)

Part VI: Part VI is concerned with transitional agreements. (Article65 to Article67)

Part VII: This part of the Agreement concerns various institutional agreements. (Article68 to Article73)

What Are The Issues Governed By The Agreement?

With respect to the aforementioned intellectual property areas, the Agreement governs issues like
application of international IP agreements and basic principles of the trading system, adequate
protection to IPRs, adequate enforcement of IPR by member nations in their territories, settlement of
disputes on IP between the members of WTO, special transitional arrangements during the period when
the new system is being introduced. The Agreement is the first agreement under WTO which requires
member nations to establish relatively detailed norms within their respective legal frameworks, as well
as to establish such measures of enforcement and such procedures which meet the minimum standards.
The three important features of this agreement are:

Standards – In respect of each of the IP areas covered by the Agreement, all member nations are obliged
to provide a minimum set of standards for the protection of IPRs. Each area of IP is covered such that it
clearly describes the main elements of protection i.e. the subject matter which seeks protection, rights
which are to be conferred and permissible exceptions to such rights and also the minimum duration of
protection.

Enforcement – Each member nation is obliged to provide domestic procedures and remedies with
respect to protection of IPR. Further, the agreement lays down certain other provisions so that right
holders can effectively enforce their rights. These provisions relate to civil and administrative
procedures and remedies and detailed specifications as to special requirements related to border
measures and criminal procedures.

Dispute Settlement – All the disputes arising between members of WTO with respect to the obligations
arising out of the TRIPS Agreement are subject to WTO’s dispute settlement procedures.

General Provisions And Basic Principles

Article 1 of the agreement provides for the member nations to implement the provisions of the
agreement in such way as member nations deem appropriate, that is to say, the standards of provisions
of this agreement are a ‘minimum’ which is to be maintained at the ground level and the nations can
further invoke an extensive protection domestically. An IPR acquired in one country cannot be enforced
in another country. The minimum standard maintenance and basic enforcement standards enshrined in
the TRIPS Agreement make it flexible for member nations to one, enforce the aforementioned basic
standards; two, implement higher levels of protection domestically thus leaving the Members to have
‘TRIPS plus’ laws and regulations. These higher standards are now making appearance on the world
trade timeline as Free Trade Agreements (FTA) entered into between trading partner nations. However,
since these agreements establish standards much higher than those of the TRIPS Agreement, they may
take away the flexibilities which exist in the Agreement. Articles 3 and 4 constitute the fundamental
principles of the agreement.

Article 3 deals with National Treatment commitment. It reads as following:

“1. Each Member shall accord to the nationals of other Members treatment no less favourable than
that it accords to its own nationals with regard to the protection of intellectual property

This article calls for the member nations to accord such treatment to the nationals of other member
nations as the former would grant to its own nationals with regard to protection of Intellectual Property
Rights. This article also recognises certain exceptions already provided in the Paris Convention (1967),
the Berne Convention (1971), the Rome Convention or the Treaty on Intellectual Property in Respect of
Integrated Circuits.

Article 4 deals with Most Favoured Nation Treatment. It reads as follows:

“With regard to the protection of intellectual property, any advantage, favour, privilege or immunity
granted by a Member to the nationals of any other country shall be accorded immediately and
unconditionally to the nationals of all other Members. Exempted from this obligation are any advantage,
favour, privilege or immunity accorded by a Member:

(a) deriving from international agreements on judicial assistance or law enforcement of a general nature
and not particularly confined to the protection of intellectual property;

(b) granted in accordance with the provisions of the Berne Convention (1971) or the Rome Convention
authorizing that the treatment accorded be a function not of national treatment but of the treatment
accorded in another country;
(c) in respect of the rights of performers, producers of phonograms and broadcasting organizations not
provided under this Agreement;

(d) deriving from international agreements related to the protection of intellectual property which
entered into force prior to the entry into force of the WTO Agreement, provided that such agreements
are notified to the Council for TRIPS and do not constitute an arbitrary or unjustifiable discrimination
against nationals of other Members.”

According to this article, any advantage, favour, privilege or immunity accorded to the nationals of one
member nation by another member nation shall automatically be accorded to all the other member
nations except for the exceptions mentioned above from sub-clause (a) to (d).

Elements of Protection and Relating Provisions

Copyrights and related rights

The protection of copyrights extends to expressions but not to ideas, procedures, methods of operation
and mathematical concepts. Computer Programs, both in source and object codes are protected by
virtue of the Berne Convention (1971) and compilation of data in machine readable or other forms
constitute intellectual creations by reason of the selection or arrangements of their contents and thus
are subject to protection in the Agreement. Rental right that is the right to authorize or to prohibit
commercial renting to the public of originals or copies of protected work is provided to authors in
respect of computer programs and cinematographic works. However, such right is subject to the
exception that if granting rental rights lead to widespread copying of such works further leading to
impairment to the exclusivity of the work then member nations can take back such rights. The term of
protection extends up to not less than 50 years as per Article12.

Performers (their performances) and broadcasting organisations have been granted protection such that
fixation of unfixed performance and reproduction of such fixation without due authorization attracts
liability. Further, performers and broadcasting organisations also have the right to prevent broadcast of
their performances and public communication of the same without authorization. Producers of
phonograms enjoy the right to authorize or prohibit the direct or indirect reproduction of their
phonograms.

Trademarks:

Article 15 of the Agreement recognises any sign or combination of signs, personal names, letters,
numerals, figurative elements, combinations of colors and combinations of any of the above as eligible
for registration as trademarks. However, where signs are not inherently distinguishable, registrability
depends on distinctiveness acquired through use. Member nations may require, as a condition of
registration, that signs be visually perceptible. For initial registration and each renewal of registration of
a trademark a term of protection is no less than seven years. The registration of a trademark is
renewable indefinitely.
Also, nature of a trademark does not act as an obstacle to its registration. Article 16 provides that owner
of a trademark has the exclusive right to prevent all third parties from using identical or similar signs for
goods or services which are identical or similar to those in respect of which the trademark is registered.
Compulsory licensing of trademarks is not permitted by the Agreement that is to say the owner of the
trademark owns the right to assign the trademark with or without the transfer of the business to which
the trademark belongs.

Geographical Indication

As per Article 22, Geographical Indications are those indications which identify a good as originating in
territory of a member nation where a given quality, reputation or other characteristic of the good is
essentially attributable to its geographical origin. Under the provisions of the Agreement, a member
nation can prohibit other member nations from the use of any designation or presentation of any goods
that indicates or suggests that those goods originate from a geographical area other than the true place
of origin in a manner which misleads the public. The term of protection for Geographical Indication is
eternal.

Patents

Article 27 of the agreement deals with patents, patentability of processes and inventions. The
patentable subject matter according to the Agreement constitutes any inventions, whether products or
processes, in all fields of technology, provided that they are novel, involve an inventive/innovative step
and are capable of industrial application. However, the following have been excluded from the ambit of
patentability:

 Diagnostic, therapeutic and surgical methods for the treatment of humans or animals.
 Plants, animals other than micro-organisms, and essentially biological processes for the
production of plants or animals other than non-biological and microbiological processes.

Under the provisions of the Agreement the member nations have to provide protection for plant
varieties either by patents or by an effective sui generis system or by any combination thereof. The term
of protection available is usually 20 years counted from the filing date of the patent application. Under
provisions of Article 21 of the Agreement, member nations may provide limited exceptions to the
exclusive rights conferred by a patent, provided that such exceptions do not unreasonably conflict with a
normal exploitation of the patent and do not unreasonably prejudice the legitimate interests of the
patent owner, taking account of the legitimate interests of third parties. Further, Article 29 makes it
imperative that the patent application discloses the invention in a manner which is sufficiently clear and
complete for the invention to be carried out by a person skilled in the art. The same Article further
provides that member nations can call upon applicants to also keep a check on the corresponding
foreign applications. Article 31 of the Agreement has provisions that allow grant a compulsory license
for pharmaceuticals by the government of a member nation without the consent of the patentee:
subject to certain conditions. Compulsory license may be allotted only in the following conditions are
fulfilled:
  Firstly, prior negotiations with the patent holder by the person/company applying for the license
on reasonable terms. Only if these negotiations fail can a compulsory license be issued.
 Secondly, after the issuing of a compulsory license the owner of the patent has to be paid
adequately. The Agreement says “the right holder shall be paid adequate remuneration in the
circumstances of each case, taking into account the economic value of the authorization”,
however, it does not define “adequate remuneration” or “economic value”. Therefore,
compulsory licensing ought to meet certain additional requirements.

As per Article 31, the following provisions have to be respected if a license is granted without the
authorization of a patent holder:

 Authorization of such use shall be considered on its individual merits;

 Such authorization shall only be considered if the proposed user has made significant efforts to
obtain the authorization from the right holder on reasonable commercial terms. However, this
right is subject to waiver by state in case of a national emergency;
 The scope and duration for such license shall extend only up to the time as the purpose of its
granting required;
 The use is to be non-exclusive;
 The license shall be non-assignable;
 Any such use shall be authorised predominantly for the supply of the domestic market of the
member authorizing such use;
 Such a license shall stand terminated once the circumstances which required adequate
protection of the legitimate interests of the license holder cease to exist;
 The right holder shall be granted adequate remuneration;
 The legal issues arising to the license shall be addressed by a distinct higher authority;
 In case, a patent “second patent” cannot be exploited without infringing another patent “first
patent” then certain conditions are to be applied given further in the Article.

Industrial Designs

Articles 25 and 26 of the Agreement deal with Industrial Designs. Member nations have to
provide for the protection of independently created industrial designs that are innovative and original.
Designs can be denied protection on the ground that they are not new or original or do not significantly
differ from the known design features. The term of protection of Industrial Designs is 10 years from the
creation of the industrial design.

Protection of Undisclosed Information

Undisclosed Information is also called a Trade Secret. The Agreement vide Article 39 obligates member
nations to offer protection for trade secrets as per the provision of the Agreement. Undisclosed
information is considered as Trade Secret if:

It is not readily accessible to persons within the circles that normally deal with the kind of information in
question;
It has commercial value because it is secret; and

The information has been subject to steps for its maintenance as a secret by the person lawfully in
control of the information.

RIGHTS AND RESPECTIVE PROTECTION AT A GLANCE

Name of IP and statute in India: Subject-matter: Protection Term: Examples

Copyrights

(Copyright Act, 1957) : Literary, artistic and software works: Life of Author +50 years term: Movie rights,
music rights

Patents

(Patent Act, 1970): Inventions and Processes: 20 years: Herbal Composition

Trademarks

(Trademarks Act, 1999): Commercial use and registration of marks, signs or combinations indicative of
goodwill: Indefinite term: Symbol of any company

Industrial Design

(Designs Act, 2000): Original designs industrially reproducible: 10 years : Design of a pack

Geographical Indications

(Geographical Indications of Goods Act, 1999): Name or sign used on Products corresponding to Specific
geographical location or origin: 10 years : Pashmeena silk of Kashmir.

Enforcement of Intellectual Property Rights

The TRIPS Agreement aimed not only at protection of the Intellectual Property rights but their due
enforcement as well. The Agreement, thus, sets out minimum standards to be established and also
provides for the administrative and civil mechanisms for enforcement. These minimum standards for the
enforcement of IPR allow right holders to protect their legitimate interests through civil court or
administrative proceedings.

It is not required for a WTO member nation to establish special or separate courts for IPR, or specially
allocate resources, like human resources, special offices for enforcement, etc. for IPR enforcement. Part
III of the Agreement on Enforcement of IPR sets out the obligations on member nations to establish
administrative and judicial mechanisms through which IPR holders can seek effective protection of their
interests. The general obligation of member nations to provide enforcement mechanisms requires that
enforcement procedures should be available under their national law so as to permit effective action
against any act of infringement of IPR covered by the Agreement, including expeditious remedies to
prevent infringements and remedies which constitute a deterrent to further infringements.
As per Article 41, member nations are obligated to ensure that enforcement procedures are “fair and
equitable”, and “not unnecessarily complicated or costly, or entail unreasonable time limits or
unwarranted delays.” Regarding the civil administrative procedures and remedies, the Agreement
provides for equal rights for both the defendant and complaining parties. The rules of the Agreement
provide that both parties should have the opportunity to present and contest evidence, and that
adequate remedial measures should be available. The Agreement permits member nations to exclude
the grant of injunctions in circumstances involving compulsory licenses and other uses.

The Agreement obligates member nations to make provision for the ordering of prompt and effective
provisional measures to prevent entry of infringing goods into channels of commerce and preserve
evidence against such infringing goods and their traders. This means that the IPR holder should be
entitled to seek a prompt action against the infringement, whether or not the party alleged to be acting
in an infringing manner can be notified and given opportunity to be heard. With respect to Border
Measures, the Agreement requires member nations to allow certain right holders to prevent release by
customs authorities of infringing goods into circulation especially, with respect to counterfeit
trademarks and pirated copyright goods. The Agreement also provides for certain Criminal Measures
(penalties) for trademark counterfeiting and copyright piracy on a commercial scale.

Dispute Settlement and Prevention: Mechanisms

Part V of the agreement deals with dispute settlement and prevention. Article 63 establishes the
transparency requirements. Under these requirements there is an obligation on the part of member
nations to publish or otherwise make available legal texts such as laws and judicial decisions. The
provisions related to dispute settlement and prevention is governed by the TRIPS council. Article 63
establishes an obligation to notify laws and regulations to the TRIPS Council or to World Intellectual
Property Organization (WIPO) for the common register, which contains a compilation of laws and
regulations, final judicial decisions, etc. pertaining to the Agreement, should that be decided upon.

Member nations are obligated to furnish applicable rules or decisions, or sufficient details about them,
at the request of member nations who reasonably believe their rights may be affected. Confidential
information is entitled to protection. Each member nation is required to be prepared to supply, in
response to a written request from another member nation, the information regarding Law, rulings,
Judicial decisions and administrative rulings pertaining to the subject matter of the Agreement (the
availability, scope, acquisition, enforcement and prevention of the abuse of IPR).

Article 64 deals with the dispute settlements. The Articles XXII and XXIII of GATT 1994 as described and
applied by the Dispute Settlement Understanding (WTO’s procedure for resolving the trade quarrels)
also apply to consultations and the settlement of disputes under the Agreement except as otherwise
specifically provided. Article XXIII of the GATT 1994 provides for three types of cause of action (a set of
facts sufficient to justify a right to sue) in GATT dispute settlement: “violation”, “non-violation” and
“situation”.