Analysis & Opinions - Business Daily

Excessive Protection of IPRs Counter-Productive

| June 22, 2007

Brazil's recent decision to break the patent rights of the pharmaceutical giant Merck has reopened debate on the role of intellectual property rights in development.

Protecting intellectual property rights (IPRs) is a critical aspect of business development and international partnerships. But excessively protective systems could have a negative impact on creativity and human welfare. It is therefore important to design intellectual property protection systems that take the special needs of African countries into account.

To encourage innovation and unlock local capital, individuals and corporations need to feel that their research is protected. But most countries developed without these protections being structured across the economy in any clear way.

Indeed, institutional development of patent regimes usually occurred after a country's firms achieved a significant level of innovation capability and then desired to protect their investments. Therefore, global intellectual property regime should acknowledge the co-evolutionary nature of technological innovation with the enforcement of intellectual property rights.

The need to strike a balance between enforcing intellectual property rights and meeting the technological needs of developing countries became a key aspect of the global intellectual property system. But it has also inspired considerable intellectual debate, especially in diplomatic and advocacy circles. Article 8 of Agreement on Aspects of Intellectual Property Rights (TRIPS) of the World Trade Organization (WTO) states that countries "may, in formulating or amending their laws and regulations, adopt measures necessary to protect public health and nutrition and to promote the public interest in sectors of vital importance to their socioeconomic and technological development."

But it also adds that such measures are consistent with the provisions of the agreement.This flexibility suggests that African countries need to formulate their interests through national policy and legislation. The successful use of the flexibility granted in the TRIPS agreement will depend on the relationship between a country and its major trading partners in the industrial world.

The TRIPS agreement (Article 66.2) also states that "developed country shall provide incentives to enterprises and institutions in their territories for the purpose of promoting and encouraging technology transfer to least-developed country members in order to enable them to create a sound and viable technological base."

This provision has received little attention, despite a 2003 decision of the TRIPS Council that called for annual reports on its implementation. There is, however, real danger that policy makers may correlate poor technology performance with restrictive intellectual property. Most of the technologies needed for economic renewal in Africa are no longer under patent protection. The challenge is identifying them, creating new businesses that use them to deliver goods and services, and offering a supporting policy environment for entrepreneurship.

This is indeed the latecomers' advantage. Their most critical challenge is not the absence of new technologies but the lack of capacity to identify and make effective use of existing technologies.

Chile, for example, has developed a viable salmon industry by acquiring technologies developed in other countries.International technology alliances between private enterprises will be the most important mechanism for technology transfer to developing countries. In this regard, technology-based trade agreements will do more for Africa’s technology development than the traditional appeal to development assistance. But none of this is credible without a clear commitment to respect private property in general and intellectual property in particular.


Prof Juma teaches at Harvard University’s Kennedy School of Government where he directs the Science, Technology and Globalisation project.


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For Academic Citation: Juma, Calestous.“Excessive Protection of IPRs Counter-Productive.” Business Daily, June 22, 2007.