THE TRIPS WAIVER PART 2: THE REVISED PROPOSALS

In the first part of this TRIPS Waiver series, we discussed the TRIPS Waiver proposed by India and South Africa. In this second part of the series, we look at the revised versions of the waiver, and the content of the adopted waiver.

THE REVISED PROPOSAL

A revised proposal was drafted a year later (May 2021) along with the support of sixty-three co-sponsors.¹ The proposal was reflective of feedback received from WTO and other relevant stakeholders.² The revised proposal updated the Original Waiver in two main ways. Firstly, it provided for specificity for the scope of health products and technologies covered by the Waiver. It included, “diagnostics, therapeutics, vaccines, medical devices, personal protective equipment, their materials or components, and their methods and means of manufacture for the prevention, treatment or containment of COVID-19.”³

Secondly, a time limit was introduced for a period of at least 3 years for the Waiver to operate.⁴ After this set period, the General Council is tasked with reviewing, “whether the exceptional circumstances justifying the Waiver still exist and if not, when the Waiver will terminate”.⁵ Further, the revised text reframed the language in the Waiver’s preamble noting and observing the “continuous mutations and emergence of the new variants of SARS-COV-2 and the need to diversify and scale up production to meet global needs and promote economic recovery”; and “the importance of preserving incentives for research and innovation, and of balancing these incentives with the public interest.”⁶ We note that although the preamble is not “operative”, it showcases the challenges brought about by the global pandemic as well as assists in “providing contextual guidance to future interpretations of the Waiver.”⁷

THE “COMPROMISE” WAIVER

The Revised Waiver was discussed in various TRIPS Council meetings by co-sponsors⁸ and the European Union.⁹ The outcome of these negotiations was a draft Decision, the so-called TRIPS Compromise Waiver.¹⁰ This version of the Waiver has limited application, covering only COVID-19 vaccines. Footnote 1 of this version provides that this Waiver would exclude developing countries that exported more than 10% of the world exports of COVID-19 vaccines in 2021. It also encourages developing countries with capacity to export vaccines to opt out of the Decision.

The Waiver provides for the tackling of COVID-19 pandemic by the limiting of patent rights in permitting the use of patented subject matter, without the authorization of the right holder. This can be done through legislative acts on compulsory licensing, executive orders, emergency decrees, judicial or administrative orders. This authorization of use of patented subject matter includes the following elements: firstly, “a single authorization to use the subject matter of multiple patents necessary for the production of a COVID-19 vaccine”.¹¹ Secondly, the eligible Member does not need the proposed user to obtain authorisation to use the patented subject matter; thirdly, the Member may waive the requirement that such authorized use is mainly to supply its domestic market.¹² Any part of the authorized use may be exported to other Members or to support initiatives towards the equitable access to the COVID-19 vaccine. Fourthly, Members are to ensure there is no re-exportation of the vaccines imported into their country under this Decision.¹³ Finally, in determining the adequate remuneration required under article 31(h) of TRIPS, Members may consider the humanitarian purpose of the vaccine distribution for equitable access to COVID-19 vaccines in order to support the production and supply of the vaccine at an affordable cost.¹⁴

The duration of this Waiver is confusingly set as “[3] or [5] years from the date of this Decision” and allows the General Council to extend this period and annually review its operation.¹⁵ This Compromise Waiver proposal, unlike the Original Waiver proposal, does not cover the production and distribution of COVID-19 diagnostics and therapeutics. Rather it provides that the Members will, within six months of the Decision date, decide on the extension of this Decision to cover diagnostics and therapeutics.¹⁶

This version has been criticised as a restrictive, narrow, insufficient, problematic and unworkable proposal.¹⁷ On the other hand, IP owners argue that there is nothing to evidence that IP hinders the production and supply of vaccines, rather they noted that the issue is one of allocation and not of supply of vaccines, citing a statement by WHO.¹⁸

THE ADOPTED TRIPS WAIVER

The negotiations on the TRIPS Waiver have been ongoing for 20 months, with no clear decision made. However, the Compromise Waiver was recently negotiated at the WTO 12^th Ministerial Conference in Geneva. The outcome of these discussions was the Draft Ministerial Decision on The TRIPS Agreement.¹⁹ This adopted text, is to a large extent similar to the Compromise Waiver presented on 3^rd May 2022.

The slight changes in this document, however, include the clarification of the definition of ‘an eligible Member’, to include all developing country Members and aims to exclude those with existing capacity to manufacture COVID-19 vaccines, through an opt-out provision.²⁰ This effectively excludes the developing countries that would likely put this Decision to use, including those involved with the mRNA vaccine technology transfer hub for Africa.²¹ This technology transfer hub is located in South Africa where the first batch of COVID-19 mRNA vaccines have already been produced. The question arising now, is whether South Africa and India are disqualified as eligible Members under this adopted Decision.

The requirement, under Article 31 (f) of TRIPS Agreement, that production must be predominantly for the domestic market has been waived, and the export restriction dropped. Though the Waiver discourages the re-exportation of COVID-19 vaccines, in exceptional circumstances, it allows for re-export for humanitarian and non-profit purposes.²² There is flexibility in determining the adequate remuneration, and the WHO-WIPO-WTO Study on Promoting Access to Medical Technologies and Innovation (2020) has been provided as a useful guideline.²³ Lastly, the duration is provided to last for 5 years.²⁴

Researchers argue that Article 31(f) of TRIPS is the “lone waiver” by this Decision, unlike the Original Waiver text which required the waiver of 40 Articles of the TRIPS Agreement.²⁵ This decision by the Ministerial Conference has greatly been criticised by the proponents of the TRIPS Waiver as the adopted text is substantially different from the Original Waiver text. One critic avers that suspending patent rights on vaccines alone is not enough as know-how transfers are also necessary to facilitate the development and production of vaccines.²⁶ The Adopted Waiver still does not include the production or supply of diagnostics and therapeutics, with a provision that in the next six months, Members will decide whether to include this. However, critics fear that this is impractical and unlikely to happen, based on the lengthy duration taken to negotiate the present Decision.²⁷

The third part of this TRIPS Waiver series will delve into the arguments by the supporters of the Original TRIPS Waiver and their reaction to the differing text in the Adopted Waiver.