The TRIPS Agreement, Research Paper Example

Enacted on January 1^st, 1995, the TRIPS Agreement is currently considered to be the foremost all-encompassing multilateral agreement detailing international intellectual property rights. The TRIPS Agreement patents, copyright, trademarks, industrial design patents, appellations of origin, undisclosed information, and geographical indications.  Examples of undisclosed information include trade and data secrets.  Article 1.3 of TRIPS defines members who are subject to TRIPS regulations.  Articles 3, 4 and 5 of the TRIPS agreement cover foreign nationals and their treatment. Finally, Article 22.1 deals with geographical indications, which is defined by The World Trade Organization as “identify a good as originating in the territory of a Member, or a region or locality in that territory, where a given quality, reputation or other characteristic of the good is essentially attributable to its geographical origin” (WTO, 1). The key argument made with geographical indication is that intellectual property rights must be applied to characteristics inherent in a particular geographic location. The following research will detail what aspects of the TRIPS Agreement have the most impact on international business as well as law, specifically in regards to the legislative transition and evolution of geographical indication and its implications on the business world.

Introduction

The World Trade Organization’s TRIPS Agreement was formed in 1994 when, the Uruguay Round of trade negotiations was nearing a resolution, guidelines regulating international trade rights were established. The Agreement on Trade-Related Aspects of Intellectual Property Rights, also referred to as the TRIPS Agreement, was drafted as a standalone treaty to enter into “legal force on its own.” It was one of the very first  “multilateral trade agreements (MTAs) to comes out of the far reaching Marrakesh Agreement Established by the World Trade Organization” (Taubman, Wager, and Jayashree, p.xx). At the time, legislation related to intellectual across borders was non-existent. Business traded internationally, but the integrity of their brands went unprotected. The TRIPS Agreement drastically changed this. As Okediji notes, (TRIPS Agreement) was the pennant of the Uruguay Round trade agreements,2 and regarded by most commentators as the most significant development in international intellectual property, certainly of the twentieth century. 3 Much like its notable predecessors, 4 the TRIPS Agreement was an ineluctable consequence of increased global economic interdependence” (Okediji, p.22). One of the most pivotal aspects of the TRIPS Agreement is geographical indication, as it relates to the inherent factors that stem from a products or brand’s geographical location. This means the protection of the distinct factors that are relevant to a product or brand’s appeal in the marketplace that can only be attributed to its geographical region of origin. In many ways this type of law can significantly impact the GDP of a region. Amending the TTRIPS Agreement to account for protections under geographical indication is one of the most significant changes to impact international law and trade in business in the past 20 years. The following will take a deeper look into why this is the case.

Body

Despite the fact that The TRIPS Agreement was drafted, issued and implemented by The World Trade Organization, the policies are not absolute. The main objective of the TRIPS Agreement is to provide broad guidelines for international intellectual property law for countries to adapt to their own laws based on conditions unique to their business model. The WTO Trade Related Aspects of Intellectual Property Rights (TRIPS Agreement), have further developed what international businesses understand as the meaning behind appellation of origin, redefining it as geographical indication stating that “… indications which identify a good as originating in the territory of a Member, or a region or locality in that territory, where a given quality, reputation or other characteristic of the good is essentially attributable to its geographical origin” (O’Connor, p.6). This definition was adapted from stipulations in the Lisbon Agreement, which expanded it to include the term “indication”. This is a critical amendment focusing on geographical place of origin, enables policy to specify location, as it relates to culture and other unique characteristics affiliated region. This distinction is mainly applicable to the minimal protections under the TRIPS Agreement. It also makes it possible in some necessary cases for member countries to engage in bilateral arrangements that can allow countries to expand on IP rights that help them draft unique protection under geographical indication. The ability to engage in bilateral agreements is also something that is standard practice between the European Community and the country that is most relevant for a particular business in a specific country. These geographical indications focus on denomination and they are referred to as EC protection for the geographical indication.

The text talks about the importance of geographical indication noting that, attempts to standardize the law must keep in mind that “a ‘mark’ in one nation may still be a generic name in another. Until the recent attempts to standardize practice take effect, the determination of whether an item is generic requires an analysis of the conditions in the country where a mark is sought” (Schaffer, Richard, Filiberto Agusti, and Lucien Dhooge, 476). The text goes on to note that geographical indication solves a very important international trade and global commerce issue, especially when circumstance where a product, like wine or liquor is assessed based on their location of origin. The text notes that there has long been a dispute about whether it is legally justifiable to label sparkling wine developed in Champagne, France, as “champagne.” The textbook mentions a case that addresses this concept, specifically as it relates to a case that occurred in New Zealand case illustrates this “geographic indications” dispute, while underscoring just how narrowly national the focus in trademark law can be” (Schaffer, Richard, Filiberto Agusti, and Lucien Dhooge, 476). The textbook mentions a case that perfectly demonstrates the value of geographical indication and its use within international trade law. In the case, an Australian company selling sparkling wine primarily in New Zealand, produced the wine from Australian grapes. Despite the fact that these grapes were grown in Australia, there was a complication that stemmed from the packaging. All of the bottles being prepared for shipment, had labels with the word champagne on display. The case notes that, “the Comite Interprofessionel du Vin de Champagne (CIVC), a group of champagne producers from the French department of Champagne, sought an injunction to prevent the Australians from “passing off” Australian sparkling wine as wine actually produced in the region of Champagne” (Schaffer, Richard, Filiberto Agusti, and Lucien Dhooge, 476). This is an ideal case of geographical indication because it deals with potential issues of false advertisement, but also trademark and brand infringement. This is why the TRIPS Agreement isolates geographical indication as a IP law issue all its own.

France was concerned that the credibility of products produced out of the city of Champagne would be jeopardized by the Australian wine. In the long run, the wine could have adverse effects on the GDP of all wines produced and distributed out of Champagne. The authors note that the resolution of the case, addressed the question in the Court as to whether importation into New Zealand was deceptive through the use of selling Seaview Champagne. The Court decided that that the use of the word champagne was not a generic use, as in the label was not in reference to an actual champagne product. The case noted that “the word champagne is distinctive and that in New Zealand it has not passed into generic territory. Having found it is not generic then to use it in the market previously described is deceptive … . By using the word champagne on the label the defendant is deceptively encroaching on the reputation and goodwill of the plaintiffs” (Schaffer, Richard, Filiberto Agusti, and Lucien Dhooge, 476).The findings of this case are pivotal in establishing the fine line between geographical distinction and standard intellectual property law. The main point the case brings to light is how sustaining the integrity of production in a particular region of the world can be challenged if proper branding policies are not followed.

The international treaties that correspond to the gradual development and use of geographical implementation in international law are specifically the 1883 Paris Convention on Intellectual Property, the 1891 Madrid Agreement, which dealt with the indication of brand, copyright and trademark source, and the 1958 Lisbon Agreement. In the Paris Convention, article 1(2), legislators get their first glimpse at intellectual property protections that seek to acknowledge geographical indication as a concern, and the convention identifies geographical indication as a specific IP right all its own. The article notes that, “the protection of industrial property has as its object patents, utility models, industrial designs, trademarks, service marks, trade names, indications of source or appellation of origin, and the repression of unfair competition” (O’Connor, p.2). Geographical indication is not defined within the article and there are also no consequences mentioned as to how businesses or governments will be impacted if they violate the policy.

It should be noted that the TRIPS Agreement, while it brings about certain amendments to international trade law, such as geographical distinction, the regulations affiliated with the policy are minimally enforced, and only used as broad guidelines from which countries draft their international trade policies. Lesser finds that valid way of assessing whether a country has sound IP laws is to measure their amount of foreign direct investments. When a country takes action to defend their intellectual property rights, like in the New Zealand case, foreign investors tend to have greater faith in their ability to perform in global markets. Lesser finds there is a direct connection between FDIs and the effectiveness with which a country defends their intellectual property rights. When he refers to defending rights, this definition entails the sustaining the legitimacy of brands, trademarks and geographical indications.

The author identifies distinct variables that influence whether foreign direct investors perceive a country as enforcing these rights effectively or not doing so to the letter of the law for optimal GDP growth. These variables ultimately decided whether investors will invest in one emerging market or another. These variables entail, “1. classical ‘gravity’-type variables describing business justifications for selecting one country over another, such as market size, costs openness and taxation, 2. agglomeration benefits like infrastructure, FDI stock and degree of industrialization, and 3. riskiness, such as the rule of law and exchange rate variability” (Lesser, p.22).The dependent variables in Lesser’s research represents all foreign investments and the number of exports that each TRIPS Agreement member country reports.  Lesser also includes other dependent variable such as residuals which were paid or earned and tech exports. The main finding in Lesser’s work is that the protection of intellectual property rights such as trademark, branding, and geographical indication significantly impacts the amount of foreign direct investment a company might receiv . This applies as well to private businesses that may be operating out of the country.

Conclusion

In sum, the most significant change that has occurred within business and international trade law due to the TRIPS Agreement, was the policy of geographical indication. Through this policy, more importance is placed on the protection of unique characteristics of a trademark or brand tied directly to the geographical indication of a certain region. This has been a vital transition for international trade law as it has enabled developing countries which largely thrive off of natural commodity exports to secure their stake in specific markets of trade, based on quality and origin. The law was actually further developed through the added benefit of denomination of origin, which added security to geographical indication policy but also loosened up regulations for innovation, marketing and creativity across border.  Through these two main policies of geographical indication, and denomination of origin, international trade has been secured on a legal standpoint while businesses have been empowered to innovate.

Work Cited

Lesser, William. “The effects of TRIPS-mandated intellectual property rights on economic activities in developing countries.” World Intellectual Property (WIPO) Studies 1 (2001): 1-24.

O’Connor, B. “Geographical indications and TRIPs: 10 Years Later… A roadmap for EU GI holders to get protection in other WTO Members.” Brussels: European Commission (2007).

Okediji, Ruth L. “Back to bilateralism? Pendulum swings in international intellectual  property protection.” U. Ottawa L. & Tech. J. 1 (2004): 127.

Round: putting TRIPs and dispute settlement together.” Va. J. Int’l L. 37 (1996): 275.

Schaffer, Richard, Filiberto Agusti, and Lucien Dhooge. International business law and its environment. Cengage Learning, 2014.

The World Trade Organization. TRIPS: A More Detailed Overview of The TRIPS Agreement. Geneva, Switzerland, 2014.