TCS Daily

TCS Convention on Biodiversity Coverage: 'Mega Diverse' Countries Against Markets

By Alan Oxley - February 15, 2005 12:00 AM

BANGKOK -- The Greens have always disliked free markets. It is one reason they hate the World Trade Organization (WTO). Now they have a have fresh offensive. They are pushing an international convention to weaken intellectual property rights by overriding established trade law.

Non-governmental organizations (NGOs) have become very skilled at attacking the WTO. Oxfam continues to gnaw away at the idea that the WTO is an institution for liberalizing trade (arguing only rich countries should reduce trade barriers). For their part environmental groups have adopted old fighting tactics used by American Indians in Hollywood westerns -- the WTO is like a wagon train which they are circling.

That is what they are doing this week at an obscure conference being held in Bangkok, Thailand. It is the Third Meeting of the Ad Hoc Open-Ended Working Group on Access and Benefit Sharing of the UN Convention on Biological Diversity.

This may seem a long way away from the WTO in Geneva, but a group of countries styling themselves the "Mega Diverse" countries at the environmental meeting in Bangkok have the WTO very much in their sights. They want a new Protocol which will reduce the legal authority of the rules set out in the WTO Agreement on Trade Related Aspects of Intellectual Property (TRIPS).

The purported goal is to stop "biopiracy" -- the theft of genetic resources from developing countries. It has never been established that there is much biopiracy. And even if there were, this not the right way to stop it. Establishing clear property rights to genetic resources, paying the right price for them and enforcing such contracts in national law is the simple answer. This is what the pharmaceutical company Merck has done in Costa Rica for example. It works.

Lead by Brazil and India, recently joined by Mexico, and including China, the "Mega Diverse" countries in the Convention on Biodiversity instead want a new Protocol with rules that regulate how patents of inventions from genetic material can be used.

Brazil and India have been unhappy about the WTO rules on intellectual property ever since they were adopted in 1994. The key reason is that they oblige them to require local companies to pay royalties when they make products, mainly drugs, that are patented by others. They argued the illicit drugs were cheaper and supported local health services. In many cases, the action was simply to protect a local company.

They have launched a fresh campaign against international intellectual property rules by backing it onto a decade-old campaign by Green non-governmental organizations (NGOs) to undermine the WTO. The Worldwide Fund for Nature (WWF), Greenpeace and the Third World Network (an NGO based in Malaysia with long ties to Ralph's Nader's Public Citizen and Friends of the Earth) began this campaign in the mid nineties. Their claim was the WTO prevented protection of the environment.

What they meant was that WTO rules threatened trade measures in environmental agreements. In some agreements (for example to prevent trade in endangered species and dumping of hazardous materials) members were authorized to restrict trade with partners who did not satisfy the environmental standard set in the agreement, even if they weren't members. The WTO requires its members to treat all trading partners on the same terms.

The Green NGOs argued that WTO rules should be changed so that the trade provisions in the environmental agreements could not be challenged in the WTO's disputes processes. The EU pushed this, but the US and developing countries were opposed.

So the Green NGOs changed tack. They set about to create further measures in new environmental agreements which expressly conflicted with WTO rules. The aim was to weaken the authority of the WTO. In international law, subsequent commitments in new treaties will generally take precedence over provisions on similar matters in earlier agreements.

The first new treaty was the Biosafety Protocol to restrict trade in certain products containing Genetically Modified Organisms (GMOs). Lori Wallach of Public Citizen urged early completion of the Biosafety Protocol in her 1999 book "Whose Trade Organization" because it would undermine WTO rules. The Protocol gave members unqualified rights to restrict trade of GMOs on environmental grounds. Under WTO rules, members were obliged to show trade restrictions on GMOs were based on sound science and did not restrict trade. EU environment officials refused point blank to include provisions in the Biosafety Protocol which explicitly protected WTO rights and obligations.

This is the strategy of the "Mega Diverse" country members of the Biodiversity Convention. They want a new Protocol which superimposes new regulations over the patent rights provided in WTO and WIPO Agreements.

This is pleasing to the Green NGOs because at root they all dislike deeply the free market values of the WTO. They correctly see intellectual property as an elaborated property right and are happy at the idea of constraining it in what they regard as the public good.

The also understand something else. Regulation can be a very effective dead hand on growth. They understand that regulating patents as they propose will chill investment and stop growth in biotechnology industries in countries which adopt such laws.

Environmental ministries in developing countries might think this is a good result, but economic ministries will not. The record to date is that officials from economic ministries turn up to obscure environmental conferences like that in Bangkok too late. If they want growth in biotechnology, that had better start to pay attention. They have one year. Brazil will host a meeting of the parties to the Biodiversity Convention in 2006. Expect it to push hard for the new Protocol.

Alan Oxley is a former Ambassador of Australia to the GATT, the predecessor of the WTO and host of the Asia Pacific page of Techcentralstation.


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