1 ISSUES RELATED TO TECHNOLOGY AND INVESTMENT POLICIES AND THE TRIPS AGREEMENT UNCTAD Commercial Diplomacy Programme Assad Omer, DITE UNCTAD

2 IMPORTANCE OF TECHNOLOGY FOR THE INTEGRATION OF DEVELOPING COUNTRIES IN THE GLOBAL ECONOMY n Knowledge-based global economy n Critical determinants of a country’s ability to compete successfully are: n the abilities to create new technology and to acquire and adapt successfully technologies from both external and internal sources UNCTAD

3 The challenge is: n to establish and maintain effective access to technology and n to devise mechanisms for deploying it effectively within the economy. n Modern technology transfer: n as a dynamic and evolving process that requires constant adaptation by all actors n Created technological assets determine comparative advantage in today's economy. UNCTAD

4 IMPORTANCE OF TECHNOLOGY FOR THE INTEGRATION OF DEVELOPING COUNTRIES IN THE GLOBAL ECONOMY n New technologies such as information technology and electronic commerce n facilitate such transfers n if they are used effectively by recipient firms n Access to these critical technologies may be limited in an overly protectionist intellectual property environment that n does not properly balance incentive to innovate against the needs for dissemination of knowledge n does not properly balance incentive to innovate against the needs for dissemination of knowledge. UNCTAD

5 Technological development is important for: n the integration and n participation of developing countries, in particular the least developed, in n the international trading system. UNCTAD

6 n Considerably change in the global regime for protecting technology development and technology acquisition n Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) n Technological knowledge: the know how of processes for producing goods and services and the organizational and management information n A key component: the transfer of the skills and intangible know how to produce and distribute goods and services efficiently LEGAL REGIME PROTECTING TECHNOLOGY UNCTAD

7 n Reduced obstacles to FDI n TNCs to disperse production activities within integrated international production systems n New opportunities for countries to attract FDI and then n to maximize the benefits associated with in term of employment, transfer of managerial skills and technology VARIOUS MODES OF TRANSFER UNCTAD

8 n First, the strengthening of the IPRs regime: n more local innovation and additional inward foreign direct investment and technology transfer n higher prices for protected technologies and products and n restricts abilities to achieve diffusion through product imitation or copying EFFECTS OF THE TRIPS AGREEMENT UNCTAD

9 n Secondly, basic principle: n a balance between n the needs of innovative firms and their licensees for protection from easy appropriation of their intellectual property, and n the needs of legitimate follow-on competitors and consumers n Thirdly, the impact of the various disciplines of IPRs: n will differ among countries depending, inter alia, n IPRs system, the level of economic and technological development, and the mode of implementation. UNCTAD

10 n In assessing the long-term costs and benefits stemming from TRIPS, n two important points need noting: EFFECTS OF THE TRIPS AGREEMENT UNCTAD

11 n Countries more likely to benefiting from additional technology transfer n with broader modernization programmes for technology development, including human resource and skills development. n Countries with net cost are those with less technological development and transfer n these countries should take full advantage of technical assistance programmes offered by Aricle 66.2 of the Agreement UNCTAD

12 n Many developing countries face growing dependence on foreign sources of technology, therefore: There is the possibility that rights holders act in ways that are detrimental to competition. In this context, the TRIPS Agreement incorporates a series of pertinent provisions (Articles 7, 8 and 40). EFFECTS OF THE TRIPS AGREEMENT UNCTAD

13 Guiding principles may be : n to stimulate competitive advantages in n exploiting spillovers, n leakages and n the products of reverse engineering by clearly defining exceptions to protection. n the products of reverse engineering by clearly defining exceptions to protection. UNCTAD

14 n 1.General obligations n National treatment (Art. 3). n Most-favoured-nation treatment (Art. 4). IPRs REGIME: MAIN CHANGES REQUIRED IN THE NATIONAL LEGISLATIONS UNCTAD

15 2.IPRs categories and standards n a. Copyrights and related rights (Art.9) n Protection of computer programs (Art.10) n Rental rights (Art. 11). n Protection of performers, producers extended organizations (Art. 14). n b.Trademarks n Protection of service marks(Arts. 15 and 16). n Protection of well-known marks (Art. 16.2). n Elimination of restrictions on use of trademarks (Art. 20). UNCTAD

16 n c.Geographical indications (Art. 22) n n wines and spirits (Arts. 23 and 24 ) n d.Industrial designs (Arts. 25 and 26) n e.Patents – –Scope of protection (Art. 27). – –Non-discrimination (Art. 27.1). – – Term of protection (Art. 33). – – Other uses without authorization of the patent-holder (Art. 31) – –Process patents (burden of proof)(Art. 34). – – Plant varieties(Art. 27). UNCTAD

17 n f.Layout designs of integrated circuits(Arts ) n g. Undisclosed information and test data –Protection of trade secrets (Art. 39) –Protection of test data n h. Anti-competitive practices in contractual licences (Art. 40.2) –International dimension (Art.40.3) UNCTAD

18 –3.Enforcement n a.General obligations (Art. 41). n.Procedures (Arts ) n c.Customs cooperation(Art. 51) n d.Criminal procedures (Art. 51). n e.Indemnification of the defendant (Art. 48) n f.Acquisition and maintenance of IPRs (Art. 62) UNCTAD

19 n 4.Dispute settlement (Arts. 63 and 64). n Transitional arrangements (Art. 65)(Art. 70.8) Least developed countries are entitled to delay application of the Agreement (Art. 66) n Technical cooperation n Developing countries(Art. 67) n LDCs (Art. 66.2) UNCTAD