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University of Cape Town, Kramer Law Building, Middle Campus

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ThedtiDivision:InternationalTradeandEconomicDevelopmentipframework@thedti.gov.za

Comments on the dti’s Intellectual Property Consultative Framework, 2016

CapeTown,30September2016Dearsir/madam:Several members of UCT’s IP Unit (faculty of law), including the undersigned, have beeninstrumentalincreatingadetailledsubmissionbyacademics,experts,scholarsandpro-accessadvocatesconcerningthedti’sIntellectualPropertyConsultativeFramework.This letteristoconfirmthattheIPUnitfullysupportsthissubmissionbyacademics,experts,scholarsandpro-accessadvocates,asattachedtothisletter.Wethankyoufortheopportunityto share our views on the IP Consultative Framework and are available to elaborate on thesubmissionifrequired.Yourssincerely,

Dr.TobiasSchonwetterDirector:IntellectualPropertyUnitUniversityofCapeTown

TheUniversityofCapeTown’sIntellectualProperty(IP)UnitstrivestoaddanAfricanvoicetotheglobaldebateonIP-relatedissues.OurfocusisonexaminingthelinkbetweenIP,innovation,developmentandpublicpolicy.WeaimatcreatingaleadingIPprogrammeinAfricathattranslatescuttingedgeresearch

intoexcellentteachingandincreasesthenumberofhighly-skilledAfricanIPexperts.Importantissuesrangefromthewayinwhichweaccessandshareknowledgetostrategieshowtocommercialiseinventionsand

avoidmisappropriation.IPisakeydeterminantofhumandevelopment,economicgrowthandcompetitiveness;andIPrulesimpactonvariouspublicpolicyareasincludinghealth,researchand

development,bio-diversity,cleantechnologies,foodsecurity,andeducation.

INTELLECTUALPROPERTYCONSULTATIVEFRAMEWORK(DepartmentofTrade&Industry,SouthAfrica)

SUBMISSIONBYACADEMICS,EXPERTS,SCHOLARSANDPRO-ACCESSADVOCATES

30September2016

Authors:

ProfessorYousufVawdaUniversityofKwaZulu-Natal

[email protected]

ProfessorBrookBakerNortheasternUniversity,USA&UniversityofKwaZulu-Natal

MrAndrewRensDukeUniversity,USA&UniversityofCapeTown

DrTobiasSchonwetterUniversityofCapeTown

[email protected]

ProfessorCarolineNcubeUniversityofCapeTown

MrAchalPrabhalaFellow,ShuttleworthFoundation

Co-submitters

ProfessorDavidMcQuoid-Mason;EmeritusProfessorHoosen“Jerry’CoovadiaMsPriyaPraveshSingh;MsSheetalSoni;MsDevinaPerumal;MsLindiweMaqutu;MsDevBellengere;MrMaropengMpya;MsSuhayfaBhamjee;MrSimphiwe;MsWilleneHolness:MrZwelethuSibiya;MrsClydeniaStevensandMrAndyGray(alloftheUniversityofKwaZulu-Natal).

ProfessorLeslieLondon;DrLee-AnnTong;MrThapeloSegodi;MrDesmondOriakhogba;MrMbuleloNcolosi;MrBramvanWiele;(UniversityofCapeTown).

MrLloydLotz(UniversityofZululand).

JudgeThumbaPillay(RetiredJusticeoftheHighCourt,KZN).

DrThrenesanNaidoo(SpecialistForensicPathologist,Durban).

ProfessorNicoSteytler;MsJadeKouletakis(UniversityoftheWesternCape).

ProfessorLoniasNdlovu(UniversityofVenda).

DrFranziskaSucker(UniversityoftheWitwatersrand).

ProfessorAdebamboAdewopo(NigerianInstituteofAdvancedLegalStudies).

MsHelenChumaOkoro(NigerianInstituteofAdvancedLegalStudies&UniversityofCapeTown)

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ProfessorSeanFlynn(AmericanUniversityWashingtonCollegeofLaw).

ProfessorAmyKapczynski(YaleSchoolofLaw).

MrRichardElliott(CanadianHIV/AIDSLegalNetwork).

ProfessorSrividyaRagavan(TexasA&MSchoolofLaw,USA).

DrGrahamDutfield(UniversityofLeeds,UK).

MrMattKavanagh(UniversityofPennsylvania).

DrVCVivekanandan(NalsarUniversityofLaw,India&UniversityofBuffalo,USA).

ProfessorJeremydeBeer;MsMeikaEllis(UniversityofOttawa,Canada).

ProfessorSunitaTripathy(OPJindalGlobalUniversity,India).

DrOluseyeJegede(AfricanInstituteforSciencePolicy&Innovation,Nigeria).

ProfessorNaglaRizk(AmericanUniversityCairo,Egypt).

ProfessorIkechiMgbeoji(OsgoodeHallLawSchoolToronto,Canada).

DrTeshWDagne(ThompsonRiversUniversity,Canada).

MrJamesKamau(KenyaTreatmentAccessMovement).

MsFelicitaHikuam(AIDSandRightsAllianceforSouthernAfrica).

MsPrimahKwagala(CentreforHealth,HumanRights&Development).

MrMosesMulumba;MrDavidKabanda(AdvocatesoftheHighCourtofUganda).

Fix the Patent Laws Coalition (incorporating the following organisations: Advocates for BreastCancer;AmaBeleBelles'ProjectFlamingo;BreastCourse4Nurses;BreastHealthFoundation;Can-Sir;Cancer Association of South Africa (CANSA); Cape Mental Health (CMH); Childhood CancerFoundationofSouthAfrica(CHOC);DiabetesSA;DoctorswithoutBorders(MSF);EpilepsySA;HospicePalliative Care Association (HPCA); Igazi Foundation; Look Good Feel Better; Marie Stopes SouthAfrica; National Council Against Smoking; Oncology Nursing Association of SA; Pancreatic CancerNetworkofSA;PeopleLivingWithCancer(PLWC);PinkTrees;ReachforRecovery;SchizophreniaandBipolar Disorders Alliance (SABDA); SECTION27; South African Depression and Anxiety Group(SADAG); South African Federation of Mental Health (SAFMH); South African Non-CommunicableDiseases Alliance (SANCDAlliance); Stop Stock Outs Project (SSP); The Sunflower Fund; TreatmentActionCampaign;VredeFoundation;andWingsofHope).

Thisdocumentissubmittedbyagroupofexperts,scholarsandaccessadvocatesworkinginthevariousareasof intellectualpropertylawandpolicy,basedatoraffiliatedwithSouthAfricanuniversitiesandotherinstitutions,includingnon-governmentalorganisations.Itdoes not purport to speak for all experts, scholars and advocates, nor does it reflect the positions of our respective institutions. Thecontributorsandsupportersarecommittedtoapro-publicpolicyperspectiveonintellectualpropertymatters,andmanyhaveregularlycontributedtothediscourseonimprovingaccesstopublichealth,knowledgeandothertechnologies.

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Introduction

TheDepartment of Trade and Industry’s (thedti) Intellectual Property Consultative Framework(theFramework)identifiestheintersectionbetweenintellectualproperty(IP)andpublichealthasapriorityarea that requires immediatedomestic review.Thus, the focusof thissubmission isonthispriorityarea.

IncraftinganIPpolicyframeworkaffecting,amongotherthings,medicaltechnologies,policyandlawmakersmust address the tension that exists between the protection of IP rights and humanrights–therightsofthepublictohaveaccesstomedicinesandotherhealthtechnologiesnecessaryfortheirwell-being.Iftherehadbeenanydoubtabouthowtoresolvethistension,thentheissuemust surely have been settledwith the release of theReport of theUN Secretary-General’sHighLevelPanelonAccess toMedicineson14September2016 (thePanelReport).ThePanelReportstates:

“Humanrightsarefundamental,universalentitlementsthatpeopleinherentlyacquirebyvirtueoftheir birth. In comparison, intellectual property rights are 'one policy tool among many forencouraging innovationandtechnologicalresearchanddevelopment.' Intellectualpropertyrightsare temporary, revocable, transferable privileges granted by states and can be suspended orrevokedundercertainconditionslaidoutintheTRIPSAgreementwhenitisintheinterestofthestateorsociety.”

YettheprimacyoftherighttohealthisnotobviousfromareadingoftheDepartmentofTradeandIndustry’s IP Consultative Framework (the Framework). The Framework recognises the‘intersection between IP and public health’ and proposes to prioritise public healthmeasures inimplementing the policy. While we welcome this statement of intent and several of the dti’spositive proposals, it is disconcerting that the Framework fails to reference the human rightsparadigminitsapproachtopolicy-making.Thisisakeythemewhichrecursinoursubmission.

TheFrameworkextolsIPrightsprotectionasakeydriverofinnovation,buttheevidenceforthatpropositionislessconvincing.InadditiontotheconsiderablescholarlyliteraturesuggestingathinconnectionbetweenIPandinnovation,theexperienceofIndia,andtheproposedpoliciesofBrazil,suggest that stringent patent standards better serve the pursuit of innovation than weakerstandards, such as they exist in theUS andEU.While the latter standards have led to a crisis inpharmaceutical innovation and in pricing of new medicines, rendering essential medicinesinaccessible, more stringent patent standards have the potential to rescue pharmaceuticalinnovation, as well as increase access to medicines. In this regard the Panel Report states inRecommendation2.6.1(a)

“WTO Members must make full use of the policy space available in Article 27 of the TRIPSAgreementbyadoptingandapplyingrigorousdefinitionsofinventionandpatentabilitythatcurtailtheevergreeningtoensurethatpatentsareonlyawardedwhengenuineinnovationhasoccurred.”

In addressing the requirement that countries adopt stringent patent standards, thePanelReportdeliberated on the existing model for financing research and development (R&D) into healthtechnologiesnamely,rewardinginnovativeactivitywithpatentmonopolies,andconcludedthat ithasproducedimpedimentstoaccessandinnovation:

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“it also has created important tensions because of high prices, and fuelled policy incoherenciesthroughtheapplicationofexclusivity-drivenbusinessmodels.Becausethissystemispredicatedontheabilitytogenerateprofit,governmentsandthebiomedicalindustryhaveoftenfailedtodelivernew health technologies for diseases that do not, and cannot, promise high returns—those thatmostlyafflictthepoorregardlessofwheretheymaylive.”

Ingeneral,well-designedIPpoliciesandlegislationcanbeausefulbutimperfectpolicyinstrumentin promoting innovation, technology transfer, R&D, industrial development and -more broadly -economicgrowth,butonlyifanti-competitiverisksareavoidedandifIPstandards,exceptionsandexemptionsallowformutualbenefitsofIPrightsholdersandusersinthepublicinterest.

The correct framing of a well-tailored IP policy does not relate to innovation and developmentobjectives only, as is acknowledged in the Framework. The Constitution and South Africa’saccession to various international and regional human rights conventions impose human rightsobligations on the state, including the right to access health care and the corresponding right ofaccess to essential medicines. In addition, South Africa’s population is entitled, under relevanthuman rights norms, to share in the benefits of scientific advancement. These human rightsprinciplesoughttohavebeendirectlyaddressedintheFramework.

ItwouldbeappropriatethatthedevelopmentofIPpolicybeginswithreferencetotheBillofRights,themostrelevantandurgentofwhicharetherighttoaccesshealthcare,includingmedicines,therighttoeducation,includingtherighttoeducationalmaterials,andtherighttojustadministrativeaction.

Thisframingmustinformtheobjectivesofthepolicywhich,wesuggest,shouldseekto:engendertheethosoftheConstitution,mostparticularlyhumanrightsobligationspertainingtohealth;strikeabalancebetween the creators and theusersof IP and thepublic at large; stimulate innovation,including incremental innovation and adaption appropriate to national needs; promote publichealth and the right to health and of access tomedicinesmore broadly; and promote access toknowledge.

OurapproachisthustoengagewiththeFrameworkinasympatheticandconstructiveyetcriticalmanner.InthefollowingsubmissionwemakecommentsontheprovisionsoftheFrameworkand,whereappropriate,offerrecommendations.

Insum,werecommendthat:

• TheGovernmentshouldsetstrictguidelinesandtimeframesforthefinalisationofpolicyinthisareaandthedraftingofrelevantimplementinglegislation.

• In themeantime, thedti should initiate regulatory and sub-regulatory reforms, includingpharmaceuticalpatentexaminationguidelines,thatwouldclarifyandtightenpatentabilitycriteria for pharmaceuticals, and allow for immediate patent examination in this area ofvitalnationalinterest.

• Theimplementationofasubstantivesearchandexaminationsystemshouldbeprioritised,andtherelevantlegislationpromulgatedtofacilitatesubstantiveexaminationbeyondmereformalities. Clarifying this issue would, for example, allow the dti to take forwardexaminationofpharmaceuticalandotherhealthtechnology-relatedpatentsasamatterofurgency,especiallyasithasalreadyhiredandistrainingacadreofpatentexaminers.

• Legislationshouldbewrittenincorporatingallpublichealthflexibilities,including:

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• The immediate amendment/repeal of Patent Regulations 40 and 41, in order tofacilitate substantive examination of patent applications and to fully complywiththeintentofsection34ofthePatentsAct;

• The introductionofexaminationguidelines linked tostrictpatentability standardswithproscriptiononminormodificationstoorvariationsofknownsubstances,newuseandnewformulationpatentstopreventever-greening;

• Full disclosure in patent applications including their foreign status and, whenavailable, the InternationalNon-proprietaryname(INN)ofpharmaceutical-relatedpatents;

• Pre- and post-grant opposition procedures, accessible to all interested parties(widelydefined);

• Parallelimportationunderanexplicitinternationalexhaustionregime;• Expansive compulsory licensing and government use provisions, including

simplified procedures, expanded (including public health) grounds for grant, andremunerationguidelinesforlowpercentageroyalties;

• Compulsorylicencestoremedyanti-competitiveconduct;• Extensive early working exceptions, as well as other exceptions for educational,

scientificandresearchpurposes;and• Exclusion of diagnostic, therapeutic and surgical methods; plants, animals and

geneticmaterial.Wesubmit that thesemeasuresareall compliantwith theTRIPSAgreementand, further,havelongbeenproposedbyvariousinternationalexpertpanels,includingthemostrecentUNSecretary-General’sHighLevelPanel.TheprocessofreformingSouthAfrica’sIPlawshasbeenaninordinatelylongone.Giventhecriticalpublichealthandpublicinterestissuesatstake,wecannotover-emphasisetheneedtomovewithutmosturgencytofinalisethepolicy.The remainder of this document provides detailed comments for many of the sectionscontainedintheIPConsultativeFrameworkdocument.Wewillbeavailabletoelaborateonoursubmissionifrequired.

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IntellectualPropertyConsultativeFramework–Section-by-SectionReview 1.Purpose......................................................................................................................................................................................7

2.Strategy..................................................................................................................................................................................11

3.Inter-MinisterialCommittee(IMC)onIP................................................................................................................13

4.Immediateissues...............................................................................................................................................................14

4.1Immediatedomesticreview..................................................................................................................................14

4.1.1Localmanufactureandexportinlinewithindustrialpolicy..........................................................16

4.1.2SubstantiveSearchandExamination........................................................................................................18

4.1.3PatentOpposition..............................................................................................................................................21

4.1.4PatentabilityCriteria........................................................................................................................................21

4.1.5DisclosureRequirements...............................................................................................................................22

4.1.6ParallelImportation.........................................................................................................................................23

4.1.7Exceptions.............................................................................................................................................................24

4.1.8VoluntaryLicenses............................................................................................................................................25

4.1.9CompulsoryLicenses.......................................................................................................................................25

4.1.9.1Judicialprocess..........................................................................................................................................27

4.1.9.2Adequateremuneration.........................................................................................................................28

4.1.9.3Governmentuse.........................................................................................................................................28

4.1.9.4Compulsorylicensesforexport..........................................................................................................29

4.1.9.5Compulsorylicensestoremedyanti-competitivepractices..................................................29

4.1.10IPandCompetition....................................................................................................................................30

4.2Internationalbestpractice–aBRICSperspective.......................................................................................33

4.3Internationalcommitments...................................................................................................................................34

4.3.1GeographicalIndications(GIs)....................................................................................................................38

5.In-BuiltAgenda...................................................................................................................................................................39

5.1Mediumterm................................................................................................................................................................39

5.2Monitoringandevaluation.....................................................................................................................................43

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1.Purpose Ourcomments

i.TheNationalDevelopmentPlan(NDP)callsforgreateremphasisoninnovation,improvedproductivity,moreintensivepursuitofaknowledgeeconomyandbetterexploitationofcomparativeandcompetitiveadvantages.Intellectualproperty(IP)isanimportantpolicyinstrumentinpromotinginnovation,technologytransfer,researchanddevelopment(R&D),industrialdevelopmentandmorebroadly–economicgrowth.

IPisonepolicyinstrument,amongothers,topromoteeconomicandsocialdevelopment.EvidenceconcerningtheimpactsofIPoninnovationandmoreparticularlyontechnologytransfer,R&Dinvestments,andindustrialdevelopmentandeconomicgrowthiscontested,especiallyinlowandmiddleincomecountries.

Well-designedIPpoliciesandlegislationcanbeausefulbutstillimperfectpolicyinstrumentinpromotinginnovation,technologytransfer,researchanddevelopment(R&D),industrialdevelopmentandmorebroadly-economicgrowth,butonlyifanti-competitiverisksareavoidedandifIPstandards,exceptionsandexemptionsallowformutualbenefitsofusersinthepublicinterest.

Innovationisaworthygoal,andakeyaspectoftheeconomicgrowthstrategiesofothercomparabledevelopingcountries.Inthisregard,inadditiontotheconsiderablescholarlyliteraturesuggestingathinconnectionbetweenIPandinnovation,itshouldbenotedthattheexperienceofIndia,andtheproposedpoliciesofBrazil,suggestthathigher,morestringentpatentstandards(suchastheyexistinIndia,andareproposedinBrazil)betterservethepursuitofinnovationoverlower,weakerstandards,suchastheyexistintheUSandEU.Whilethelatterstandardshaveledtoacrisisinpharmaceuticalinnovation,renderingessentialmedicinesinaccessible,higher,morerigorouspatentstandardshavethepotentialtorescuepharmaceuticalinnovation,aswellasincreaseaccesstomedicines.

Thecurrentformulationplacesanover-emphasisoneconomicconsiderations(suchascompetitiveadvantages)oversocialimperatives(accesstoknowledge-basedgoods).

ItisalsodisconcertingthattheconceptofhumanrightsisnotmentionedonceintheFramework,whichisindicativeoftheconceptualdivideinseekingabalancebetweenIPprotectionandhumanrights.

ii.Government’sexperiencetodatehasshownthatIPisavast,interdisciplinaryfieldthatimplicatesabroadrangeofgovernmentdepartmentsandagencies.Therefore,itisimpossibleforoneMinistry,absentextensiveinter-

Inter-governmentalandstakeholderconsultationisimportant,butSouthAfrica’sIPpoliciesconcerningpharmaceuticalpatentshavebeenunderreviewforalongtimeandreformsareurgentlyneeded.TheGovernmentofSouthAfricashouldsetstrictguidelinesandtimelinesforthefinalisationofpolicyinthisareaandthedraftingofrelevantimplementinglegislation.Inthemeantime,thedtishouldinitiateregulatoryandsub-regulatoryreforms,including

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governmentalconsultationandcollaborationtopresentabroadlyrepresentativegovernmentalperspective.ThesamecanbesaidofthenumeroussectorsofsocietythatareaffectedbyIP.

pharmaceuticalpatentexaminationguidelines,thatwouldclarifyandtightenpatentabilitycriteriaforpharmaceuticals,andallowforimmediatepatentexaminationinthisareaofvitalnationalinterest.

iii.ThepurposeofthisdocumentisnottoprescribeSouthAfrica’sIPpolicyposition,buttoputforwardtheperspectiveofthedtiinaconsultativeinstrumenttofacilitatewhatwillbecontinuousengagementwithgovernmentalpartnersandsocietyatlarge.ThisinourviewisthebestwaytorendertheformulationofSouthAfrica’sIPpolicyajointprojectthatadoptsacoordinatedapproach.

Thisframingthatsuggestsaprotractedadditionalperiodofconsultationwithgovernmentpartnersandotherstakeholdersthatcouldunreasonablydelayneededreforms.Injustthepastfiveyears,itislikelythatSouthAfricahasgrantedover10,000pharmaceuticalpatents,manyofwhichwouldhavebeenrejectedevenintheUSandEurope.

iv.Theextentofpublicengagement;theinternalcapacityofgovernmentsonIPmatters;andthedegreeofgovernmentco-ordinationarekeyfactorsinnationalIPpolicyformulationandlawreform.thedtiaimstoensurethatthedevelopmentofSouthAfrica’sIPpolicytakesintoaccountthesefundamentalprinciples.TheIPConsultativeFrameworkwillserveasatoolinpursuingthisapproach.

Therehasalreadybeenanintensemulti-yearperiodofpublicengagementonthepharmaceuticalpatent-relatedaspectofSouthAfrica’semergentIPpolicy.AlthoughthisConsultativeFrameworkisperhapsausefulstepinfinalisingtheconsultativeprocess,dtiandotherrelevantministriesmustpromptlyfinaliseactualpolicyandthenproceedexpeditiouslytoacceleratetheresultinglegalreformsrequired.

Indoingso,thepolicyneedstofocusnotonlyonsubjectiveissuessuchascapacityconstraints,butalsoanelaborationoftheexternalcontextsuchasthedevelopmentalchallengesfacingSouthAfricathatneedtodriveIPreform,namelytheproblemsofthelackofaccesstomedicines,educationalmaterialsandotherpublicgoods.

v.SouthAfricarequiresacoordinatedandbalancedapproachtoIPthatprovideseffectiveprotectionofIPrights(IPRs)andrespondstoSouthAfrica’suniqueinnovationanddevelopmentdynamics.SouthAfrica’sIPPolicymustengendertheethosoftheConstitutionandcomplementthecountry’sindustrialpolicyandbroadersocio-economicdevelopmentobjectives.Hence,theIPPolicy

Thecorrectframingforawell-tailoredIPpolicydoesnotrelatetoinnovationanddevelopmentobjectivesonly,asisacknowledgedelsewhereinthisframework.TheSouthAfricanConstitutionandSouthAfrica’saccessiontovariousinternationalandregionalhumanrightsconventionsimposeshumanrightsobligationsonthecountry,includingtherighttoaccesshealthcareandthecorrespondingrightofaccesstoessentialmedicines.Inaddition,SouthAfrica’spopulationisentitled,underrelevanthumanrightsnorms,toshareinthebenefitsofscientificadvancement.Thesehumanrightsprinciplesshouldbedirectlyaddressedinthisprovision.

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mustbeinformedinteraliabytheConstitution,NDP,theNationalIndustrialPolicyFramework(NIPF)andthevariousiterationsoftheIndustrialPolicyActionPlan(IPAP).Itshouldalsobealignedtothecountry’sobjectivesofpromotinglocalmanufacturing,competitivenessandtransformationofindustryinSouthAfrica.

vi.Increasingly,IPisdiscussedinvariousinternationalforumssuchastheWorldIntellectualPropertyOrganization(WIPO),TheWorldTradeOrganization(WTO),theGroupofTwenty(G20),theOrganizationforEconomicCo-operationandDevelopment(OECD)andinengagementswithtradepartners.ThisrequiresacoordinatedSouthAfricanapproachtoIPmattersinformedbySouthAfrica’sdevelopmentimperatives.

Inaddition,theUnitedNationsSecretary-General’sHighLevelPanelonAccesstoMedicineshasjustaddressedindetailthepolicyincoherencebetweenIPandtrade,humanrights,andpublichealth.Furthermore,SouthAfricaispartytovariousunderstandingswithregionalpartners,includingSADCandtheAfricanUnionwhich,amongothermatters,directlyaddressobligationstoactonpublichealthcrises,includingHIV,tuberculosis,andmalaria,andtheneedtoutilisealllegallypermissiblepublichealthflexibilitiesundertheWTOAgreementonTradeRelatedAspectsofIntellectualPropertyRightsandtheDohaDeclarationontheTRIPSAgreementandPublicHealth.

RegardmustalsobehadtotheReportoftheSpecialRapporteurinthefieldofculturalrights:Patentpolicyandtherighttoscienceandculture(OfficeoftheHighCommissionerforHumanRights(OHCHR).HumanRightsCouncil70thSession,4August2015,UNGeneralAssembly,NewYork).

OthermajorforaofdiscussionaroundIPRsarebilateralandregionaltradenegotiations,wheredevelopingandleastdevelopedcountriesareoftencoercedintoagreeingtoTRIPS-plusstandardsofIPRprotection.Inthiscontext,thestatementsunderInternationalcommitments(4.3ix)oftheFrameworkarewelcomed.

vii.TheSouthAfricanConstitutionguaranteestherighttopropertyandthatnolawmaypermitarbitrarydeprivationofproperty.IntermsoftheConstitution,propertyisnotlimitedtolandandwouldbyimplicationincludeIP.ThisinterpretationisconsistentwithConstitutionalCourt

ItisappropriatethatthedevelopmentofIPpolicybeginswithreferencetotherelevantrightsintheBillofRights,themostrelevantandurgentofwhicharetherighttoaccesshealthcare,includingmedicines,therighttoeducation,includingtherighttoeducationalmaterials,andtherighttojustadministrativeaction.

TheassertionthattheSouthAfricanConstitutionunambiguouslyguaranteespropertyrightswithrespecttointellectualpropertyisinaccurate.Section25,whichdealswithproperty,statesthatno-onemaybearbitrarilydeprived

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jurisprudence.Inaddition,theConstitutionprovidesabalancedapproachtopropertyrightsbyalsotakingintoaccountpublicinterest.Inthisregard,publicinterestincludesthenation'scommitmenttobringaboutreformsthatpromoteequitableaccess.AbalancedapproachwillbetakeninthedevelopmentoftheIPpolicyinlinewiththeConstitution.

ofpropertyordeprivedofpropertywithoutcompensation.Thisisnotequivalenttoaconstitutionalrighttopropertysuchasisfoundintheconstitutionsofsomecountries.InCertificationoftheConstitutionoftheRepublicofSouthAfrica,1996(CCT23/96)[1996]ZACC26http://www.saflii.org/za/cases/ZACC/1996/26.html,theConstitutionalCourtconsideredtheclaimthatIPrightsarea“universallyacceptedfundamentalright,freedomandcivilliberty”,andconcludedthatsuchaninterpretation“cannotbecharacterisedasatrendwhichisuniversallyaccepted”.

WhileitisaccuratetosaythattheConstitutionrequiresabalancedapproachtowhatisproperlyconsideredpropertybytakingintoaccountpublicinterest,theConstitution’shumanrightsobligationsactuallyrequiretheGovernmentofSouthAfricatoprioritisetherighttohealthasaprimaryobjective.

DespiteUNorganssuchastheCommitteeonEconomicSocial&CulturalRightsreportingthatArt15oftheInternationalCovenantonEconomicSocialandCulturalRights(ICESCR)shouldalwaysbeinterpretedtoprioritisehumanrightsoverpropertyrights,SouthAfricancourtshaveroutinelydeferredtoIPRsingrantinginterdictsagainstallegedinfringersofpatentsbeforeafullhearingonrevocationproceedings-seePfizervCipla(2005)ZACCP;AventisvCipla(2012)ZASCA.

ThusitisimperativethattheIPpolicyprovideclarityonthegovernment’spositiononthisissue.

viii.Asstatedinparagraph7oftheAfricanGroup’sproposalfortheestablishmentofaDevelopmentAgendaforWIPO:

“IPisjustonemechanismamongmanyforbringingaboutdevelopment.ItshouldbeusedtosupportandenhancethelegitimateeconomicaspirationsofalldevelopingcountriesincludingLDCs,especiallyinthedevelopmentoftheirproductiveforces,comprisingofbothhumanandnaturalresources.IPshouldtherefore,becomplementaryandnotdetrimentaltoindividualnationaleffortsatdevelopment,bybecomingaveritabletoolfor

TheassertionthatIPRprotectionenableseconomicgrowthisoverstatedandnotsupportedbyevidence.ResearchindicatesthatincreasedIPprotectionappearstohavelittleeffectinthedevelopingcountrycontext,andthatdomesticinnovationacceleratesincountrieswithhigherlevelsofeconomicdevelopment,educationalattainmentandeconomicfreedom.Further,strengtheningpatentrightsresultsinanincreaseinfilingsfromforeignapplicants,withnoeffectonfilingsbylocalinventors.Finally,thecorrelationbetweenstrongIPprotectionandforeigndirectinvestmentisyettobeestablished.

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economicgrowth”.

ix.ThisdocumentraisesdiscussionpointsandproposesawayforwardforSouthAfricatoensureadevelopment-orientedIPpolicywhichiscognizantoftheinternational,regionalanddomesticcontext.Assuch,itproceedsfromthebasisthattheIPpolicyshouldadvancethefollowingobjectives:

a.EngendertheethosoftheConstitution.

b.Alignthecountry’sIPregimetoitsNDPandindustrialpolicy.

c.Developaco-ordinatedintergovernmentalapproachtoIP.

d.StrikeabalancebetweenthecreatorsandusersofIP.

e.Stimulateinnovation.

f.Facilitatethedevelopmentofkeyindustrieswhilestrikingabalancewiththepublicinterest.

g.Contributetotheattractionofforeigndirectinvestmentandtechnologytransfer.

h.AdoptacoordinatedapproachtoIPinsub-regional,regionalandinternationalforums.

i.Promotepublichealth.

Thisisanimportantandconstructivesection,buttherighttohealthandofaccesstoessentialmedicinesneedsgreaterspecificationandprioritisation,especiallysincethisconsultativedocumentisfocusedonpharmaceuticalpatents.Thestatedobjectivesshouldberevisedasfollows:

a.EngendertheethosoftheConstitution,mostparticularlyhumanrightsobligationspertainingtohealth.

d.StrikeabalancebetweenthecreatorsandtheusersofIPandthepublicatlarge.

e.Stimulateinnovation,includingincrementalandadaptionappropriatetonationalneeds.

i.Promotepublichealthandtherighttohealthandofaccesstomedicinesmorebroadly.

and

j.promoteaccesstoknowledge.

2.Strategy Ourcomments

i.TheIPpolicyiseagerlyawaitedinviewoftheimportantissuesandintereststhatitwillaffect.

Weoffernocommentatthistime.

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Hence,thereisaneedtoassurethepublicthatgovernmentrecognizestheurgencyandimportanceofreforminkeyareas.Ontheotherhand,urgencycannotbeareasontosacrificetherequisitedepthofanalysisinwhatarehighlytechnical,importantandcontentiousissues.

ii.Asameansofstrikingabalancebetweentheneedforurgentactioninsomeareasandfurtherindepthstudyinothers,itissuggestedthattheissuesbecategorizedasimmediate,mediumtermandmonitoringandevaluation.

Thephasedapproachissupported.Inaddition,thereisaneedtodefinemoreclearlykeyprocessessuchas:

• Theimmediateamendment/repealofPatentRegulations40and41,inordertofacilitatesubstantiveexaminationofpatentapplications;

Theintroductionofexaminationguidelineslinkedtostrictpatentabilitystandards.Suchchangeswouldensurefullcompliancewithsection34ofthePatentAct(theAct)whichprovides:‘TheregistrarshallexamineintheprescribedmannereveryapplicationforapatentandeverycompletespecificationaccompanyingsuchapplicationorlodgedatthepatentofficeinpursuanceofsuchapplicationandifitcomplieswiththerequirementsofthisAct,heshallacceptit’.

TheActrequiresmorethanmerecompliancewithformalities,andenvisagessubstantiveexaminationoftheapplicationaccordingtothepatentabilitycriterialistedinsection25(1).

iii.Theimmediateissueswillbeanalyzedandindepth,tangiblereformssuggestedinconsultationwithintergovernmentalpartnersandexternalstakeholders.Finitetimelineswouldbeattachedtothese.

Itispositivetosuggestfinitetimelinesforimmediateissues,suchaspharmaceuticalIPpolicy,butitshouldrequire“finiteandexpeditious”timelines.

Inadditiontotheprocessesmentionedunderourcommentsto(ii)above,stepsmustbetakentooperationaliseoppositionprocedures,permittedexceptionsandotherflexibilities.

iv.Themediumtermissuesformpartofthein-builtagenda.Thesearekeyareasthatrequirefurtherin-depthstudy.ThisshouldbedoneinaccordancewithinternationalbestpracticessuchasWIPOmethodologiesandinformedbydomesticpriorities.Moreflexibletimelineswould

ItiscontestablethatWIPOmethodologiesrepresentinternationalbestpractices.AsSouthAfricaandotherdevelopingcountriesfrequentlyassert,WIPO’sdevelopmentpoliciesarestillunderdevelopedandunder-implemented,andarenotproperlyreflectedinitstechnicalassistanceandguidancedocuments.Thisisparticularlytruewithrespecttopharmaceuticalsandaccessconcerns.

Inaddition,SAshouldlooktootherdevelopingcountryexemplarsindesigningitsregulatorysystem,suchas

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applytothese.

Argentina,IndiaandBrazil.

v.ThemonitoringandevaluationofexistinginitiativeswouldbeundertakenwiththeviewtoundertakingimpactassessmentandalignmentwiththebroaderIPPolicywherenecessary.Flexibletimelineswouldbeapplicable.

Impactassessments,whetherofcurrentorfutureinitiatives,mustincludehumanrightsimpactassessmentsasrecommendedintheReportoftheSpecialRapporteurinthefieldofculturalrights:Patentpolicyandtherighttoscienceandculture,referredtoabove.

vi.Itisproposedthereforethatinlightoftheurgency,importance,highpublicprofileaswellasthestronginstitutionalcapacityandexperiencepossessedbygovernmentontheintersectionbetweenIPandpublichealthwhichcoversamongothersmedicines,vaccinesanddiagnostics,thisareatogetherwithitsmultiplicityofsub-issuesshouldbetheimmediatepriority.ItisalsoimportanttopursueareaswhereSouthAfricahasinternationalcommitmentssuchasgeographicalindications(GIs)tocomplywithandtakeadvantageofopportunitiescontainedininternationalagreements.

Itiscompletelyappropriatefordtitoidentifythisareaasoneofimmediatepriorityandurgency.

Theprioritisationofpublichealthandtheconstitutionalethos/humanrightsapproachtointerpretingIPissuesintheFrameworkiswelcomed.Thisprincipleshouldinformpolicy,implementationandultimatelyjudicialdecisions.

vii.Prioritizingtheseissuesaffordsanopportunitytoestablishpublicconfidenceintheprocessbeingundertakenbygovernment.Thiswillserveuswellgoingforwardaswepursuethebroaderin-builtagendaoncetheimmediateissueshavebeenaddressed.


3.Inter-MinisterialCommittee(IMC)onIP Ourcomments

i.Giventhecrosscuttingnatureof ‘Inter-Ministerial’appearstobeusedinterchangeablywith

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IP,ensuringinter-governmentalcoordinationiskey.WhilethedtimayleadonIP,onlyacollaborativeeffortcanharnessthecollectiveresourcesingovernmenttothebenefitofthepeopleofSouthAfrica

ii.ThecommitteemustbecomprisedofgovernmentofficialsresponsibleforimplementingprogramsthateitheraffectorareaffectedbyIP.

‘inter-governmental’(thelatterisamisnomerhere,asitusuallymeansbetweengovernments).

ThiscommitteemustbepromptlyconvenedanditmustfinalisetherelevantIPpolicyframeworkconcerningpharmaceuticalsandotherhealthtechnologiesasamatterofurgency.

Itiscrucialthatthiscommitteecompriseshigh-leveldecision-makersforthesakeofexpeditionandprogress.

iii.Intheimmediateterm,theIMCwouldserveasaconsultativeforumaimedatachievingacoordinatedapproachtotheIPpolicyformulationprocess.Thisfunctionwouldcontinueaswepursuethebroaderin–builtagenda.Thereafter,thecommitteewouldensureimplementationoftheIPpolicyingovernmentprograms.

Thisconsultativeforumshouldbeabletoreadilyfeeditsinputsincabinetdecision-makingprocesses,fortablingofdraftlegislationandregulations.

iv.AnotherkeyfunctionthatthecommitteewouldserveistoensureaconsistentandcoherentgovernmentapproachtomultilateralIPforums.Toachievethisend,theIMCshouldworkcloselywithgovernmentofficialsrepresentingSouthAfricaatmultilateralforumstoensureharmonizednegotiatingpositions.

ConsistencyisbestachievediftheIMCisahigh-levelorganwhichpromotescoherenceinpolicyandnegotiationsatinternationalandregionallevels.

4.Immediateissues

4.1Immediatedomesticreview Ourcomments

i.TheSouthAfricangovernmenthasaproudhistoryofrobustlyengagingwithissuesthatconcern

Thisisanimportantpoint.SouthAfricaneedstocontinueand,infact,escalateitsroleinthisregard.

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theintersectionbetweenIPandpublichealth.Indeedthegovernment’sstanceinPMAvthePresidentoftheRepublicofSouthAfricawasakeyfactorleadingtoglobaldialoguearoundthepotentiallynegativeimpactofIPRsonpublichealth,culminatingintheDohaDeclarationonTRIPSandPublicHealth.

ii.SouthAfricahasbeenakeyplayerintheglobalrecognitionthatthedutyowedbyStatestosafeguardpublichealthisnotinconsistentwiththeirconcomitantresponsibilitytohonorinternationaltreatyobligations.Tellingly,paragraph4oftheDohaDeclarationonTRIPSandPublicHealthstatesasfollows:

“WeagreethattheTRIPSAgreementdoesnotandshouldnotpreventmembersfromtakingmeasurestoprotectpublichealth.Accordingly,whilereiteratingourcommitmenttotheTRIPSAgreement,weaffirmthattheAgreementcanandshouldbeinterpretedandimplementedinamannersupportiveofWTOmembers'righttoprotectpublichealthand,inparticular,topromoteaccesstomedicinesforall.”

Thisisanimportantpoint.SouthAfricaneedstocontinueand,infact,escalateitsroleinthisregard.

iii.Havingsaidthis,theSouthAfricangovernmenthastodatenotmadefulluseoftheflexibilitywithininternationallawthroughthepursuitofappropriatepolicyandlegislation.ThisisdespiteaConstitutionalimperativetoincreaseaccesstomedicinesasacomponentoftheState’sobligationtotakereasonablemeasurestowardtherealizationoftherighttohealthcareservices.

ItisextremelyimportantthattheGovernmentacknowledgesthatithasnotmadefulluseofallowableflexibilitiesininternationallawandthatithasaConstitutionalimperativetoincrease,indeedtoprioritise,accesstomedicines.InthisregarditisalsoimportanttonotethattheUNSecretaryGeneral’sHighLevelPanelFinalReportonAccesstoMedicinesstatesthatcountriesmustadoptstringentstandardsofpatentabilityandthattheyshouldadoptallotherTRIPS-compliantflexibilities.

Thepolicyshouldrequire,amongothers:• Strictpatentingstandardswithproscriptiononnew

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Indeed,thisConstitutionalimperativeisreflectedingovernmentpoliciessuchastheNDPandtheNationalDrugPolicyforSouthAfrica.ItisaptthattheIPPolicyshouldsupporttheseinstruments.

useandnewformulationpatentstopreventever-greening;

• Fulldisclosureinpatentapplications;• Pre-andpost-grantoppositionprocedures;• Parallelimportationunderanexplicitinternationalexhaustionregime;

• Expansivecompulsorylicensingandgovernmentuseprovisions(simplifiedprocedures,expandedgroundsforgrant,remunerationguidelineswithlowpercentageroyalties);

• Compulsorylicencesforanti-competitiveconduct;• Extensiveearlyworkingexceptions,aswellasotherexceptionsforeducational,scientificandresearchpurposes;and

• Exclusionofdiagnostic,therapeuticandsurgicalmethods;plants,animalsandgeneticmaterial.

iv.Whatfollowsisadiscussionofkeyareasidentifiedbythedtiasdomainswhereamoreequitablebalancecouldbestruckbetweenprivateandpublicinterest.Thepurposeofhighlightingtheseissuesistogarnertheviewsofgovernmentalpartnersonhowbesttoachieveanappropriatebalance.TheaimistoensurethatSouthAfricaprotectsIPRsandatthesametimeachievesitsobjectivesofpromotingnationaldevelopmentimperativeswhichincludeamongothersboostinglocalmanufacturing,innovationandensuringequitableaccesstomedicines.Thiswillrequiredevelopmentofanappropriateframeworkforgrantingpatents.Anumberofinterventionsasoutlinedbelowwillbeexplored.

Itisappropriatethatthedtishouldseektheinputofotherrelevantgovernmentalpartners,butitisvitalthatthedtishoulddomoretoassertitsopiniononsomeofthekeypolicyissuesidentified,mostespeciallypatentabilitycriteria.Theprocessrisksbeingfurtherdelayedifthedti,thedepartmentwiththemostexpertise,doesnotarticulateclearpositionsoncertaincontestedissuesandindicateitspreferredpolicyapproachasaguidetoothergovernmentpartners’deliberations.

4.1.1Localmanufactureandexportinlinewithindustrialpolicy Ourcomments

i.ThePharmaceuticalsindustryisoneoftheprioritysectors

Industrialpolicyisanimportantdevelopmentgoal,tobecloselyalignedwithotherequally,ifnotmore,important

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identifiedbyIPAP.ThecontributionofmanufacturinginthisindustrytoSouthAfrica’sGDPhasdeclinedfrom1.6-1.1%overthepast6years.Havingsaidthis,thesectorprovidesdirectemploymenttoapproximately10,000peopleandthedownstreamsegmentprovidesapproximately25,000jobs.

goalssuchastherealisationoftheuniversalrighttohealththroughenablingaccesstocheapergenericmedicines.

SouthAfricacurrentlysourcesapproximately38%ofitssupplyfromoriginatorcompanies(MNCs),andapproximately58%fromgenericfirms(predominantlylocal).InIndia,theBRICScountrywhereaccesstomedicinesisarguablyatthehighestlevel,supplyfromMNCsaccountsforapproximately20%ofthemarket,asagainstapproximately80%whichissuppliedbygenericcompanies,predominantlylocalindustry.GivenSouthAfrica’srelativelydevelopedgenericdrugindustry,thiswouldsuggestthatanysoundindustrialpolicystrategyonIPshouldseektogrowthebaseoftheSouthAfricandomesticgenericdrugindustry,thusboostinglocalproduction,skills,andemployment.

ii.Thelocalpharmaceuticalmarket(atwo-tierpharmaceuticalmarket,dividedintothepublicandprivatemarket)isthelargestinSub-SaharanAfricaandworthatotalestimatedR40billion.AccordingtotheNationalAssociation,thecountryspent8.7%

ofitsGDPonhealthcarein2014passingthe5%recommendedbyWHO.

Itisalsoatwo-tiermarketintermsofproduction,asstatedabove,with58%ofthemarketheldbyMNCsandabout38%ofthemarketheldbySouthAfricangenericdrugcompanies.

iii.Despitethesefigures,theSouthAfricanpharmaceuticalssectorisstillrelativelysmallbyinternationalstandards,constitutingamere0.4%and1%oftheglobalmarketbyvalueandvolumerespectively.ThereistremendouspotentialforthissectortogrowandcontributefurtherjobstotheSouthAfricaneconomy.

SouthAfricacancertainlylearnfromtheexperienceofIndia,thedevelopingcountrywhichhasmostsuccessfullycreatedandmaintainedapharmaceuticalindustry,whichitdidsobyinstitutinghighstandardsforpatentability,pre-andpost-grantoppositionandotherpro-accessprovisions.

iv.GrowthofthedomesticpharmaceuticalindustrywillcontributetosustainabilityofsupplyandallowthecountrytofulfillkeyhealthobjectivesoftheNationalDrugPolicy,inparticular,toensuretheavailabilityand

Growingalocallyowned,domesticpharmaceuticalindustrywillnotonlycontributetothehealthandwellbeingofSouthAfricansbyincreasingaccesstomedicines,butalsotopromotingthelocaleconomy,intermsofemploymentandcontributiontotheGDP,anddevelopmentofskills.

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accessibilityofessentialdrugs.Itisestimatedthat65%ofdomesticdemandismetbyimportsandthatmedicalproductsarethe5thlargestcontributortoSouthAfrica’stradedeficit.Whileimportsareanimportantsourceofmedicines,increasingdomesticcapacitybypromotingbeneficiationandlocalizationwillensuresecurityofsupply,giveninteraliathatthecountry’suniquediseaseburdennecessitatesdrugsformulatedusingspecificactivepharmaceuticalingredients(APIs)ofwhichglobalsupplyislimited.

v.ProjectKetlaphelaisagovernmentdriveninitiativeaimedatestablishingafullyintegratedpharmaceuticalcompany.TheentitywillengageinthemanufactureofAPIsandintheshort-mediumterm,tabletformulationtargetingtheburdenofdiseasesinitiallyforSouthAfricaandsubsequentlyexpandingintotheSouthernAfricanDevelopmentCommunity(SADC).Thiswillbekeytoincreasingthedomesticcomponentofthesupplyofgenericantiretrovirals(ARVs)andimprovingsecurityofsupplybothdomesticallyandsub-regionally.SouthAfrica’sIPregimeshouldcomplementthecountry’sindustrialdevelopmentambitionsastheypertaintokeysectorssuchaspharmaceuticals.

SouthAfricanremainsarelativelysmallmarket,andtheroutetodevelopingtheindustryliesinbecomingasuppliertootherdevelopingcountries,particularlyinSouthernAfrica.Thefutureofthedomesticindustrydoesnotrequirepatentmonopolies,butthefreedomtomakemedicinesthatcanbeexportedtoleastdevelopedcountriesanddevelopingcountries,asaffirmedintheDohaDeclaration.

ManyaccesstomedicineseffortsrelyonSouthAfrica’scapacitytosupplythesouthernAfricanregionandbeyond.ThelicencesnegotiatedwithMNCsaftertheTACCompetitionCommissioncasesintheperiod2002-2004haveappliedtoallSADCcountries.

WhileProjectKetlaphelaisanimportantinitiative,inadditiontheenablingframeworktoaccesscheapergenericmedicinesfrommultipleproducersshouldimmediatelybeputinplace.

4.1.2SubstantiveSearchandExamination Ourcomments

i.ItisamatterofmuchdebatethatSouthAfricadoesnotconduct

Thedepositorysystemisarelicofthecolonialera,duringwhichthecolonieswereexpectedtograntblanketapproval

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substantivesearchandexamination(SSE)priortothegrantofpatents.Section34ofthePatentsAct57of1978(PatentsAct)readtogetherwithRegulations40and41ofthePatentRegulations,1978(PatentRegulations)havetheeffectthattheCompaniesandIntellectualPropertyCommission(CIPC)onlyconductsexaminationinrelationtotheformalitiesoftheapplication.Hence,SouthAfricaemploysasocalleddepositorysystem.ThemajorbenefitofthedepositorysystemisthatitplacesthecostofsubstantiveexaminationonpartiesthataredirectlyinterestedinthepatentintheeventthatthegrantofapatentischallengedattheleveloftheCommissionerofPatents.ThisallowstheStatetoallocatescarcetechnicalskillstowardinfrastructuredevelopmentandotherkeydevelopmentalareas.Despitethisbenefit,therearemajordrawbacksforboththeproducersandusersofIPresultingfromthedepositorysystemthatrenderitcrucialtoworktowardtheadoptionofSSE.

ofallIPRsgrantedinthemetropolis.Thissystemdisservedthecoloniesinthepast,andcontinuestodosoasdevelopingandleastdevelopedcountriesstruggletocatchuptechnologically.Indiaservesasagoodexampleofthebenefitsoffully-capacitatedpatent-examiningoffice.

Itisextremelyimportantthatthissectionprioritisestheimplementationofasubstantivesearchandexaminationsystem.Itisperhapsimportanttoclarify,however,thattherelevantlegislationactuallyallowsforsubstantiveexaminationbeyondmereformalities.Clarifyingthisissuewould,forexample,allowthedtitotakeforwardexaminationofpharmaceuticalandothermedicaltechnologyrelatedpatentsasamatterofurgency,especiallyasithasalreadyhiredandistrainingarelevantcadre.

Themajorbeneficiariesofthedepositorysystemarepatentapplicantsandtheirlawyers,notthepublicwhichhastocontendwithunwarranted(pharmaceutical)patents,longundeservedpatentterms,anddelayedaccesstocheaperdrugs.

Regulations40and41undulycircumscribedtheexaminationfunctionpermittedbysection34,andmustberepealed.

ii.Theunderlyingpolicyrationaleofpatentsistoserveasanincentivetostimulateinnovation.InadoptingSSE,thechallengewillbetoensurethatpatentabilitycriteriaareobservedwhileatthesametimeavoidingbacklogs.ThiswillrequirejudiciousandefficientuseoflimitedStateresources.Severalmodelsarebeingconsidered,includingtheintroductionofonlinepatentsearchesandsubstantiveexaminationthatcombinespartialrecognitionofsearchesandexaminationreportsconductedin

ItisappropriatetorecognisethatSouthAfricaisfreetoprioritiseSSEinthepharmaceuticalsectorandalsothatitscapacityinthisareaisweakatpresent.However,SouthAfricashouldexercisegreatcautioninrelying,evenpartially,onexaminationsconductedbyforeignoffices,especiallyforeignofficesthathaveadoptedlowerstandardsofpatentability(novelty,inventivestep,industrialapplicability,anddisclosure)thanSouthAfrica.Forexample,manycountries,includingtheUnitedStates,countriesinEurope,andJapanapplyrelativelylaxstandardsthatallowpatentingofminormodifications/variationsofknownsubstances,newpharmaceuticalformulations/dosages,andnewusesofmedicines.OneofthemainobjectivesofSouthAfricanpatentlawreformandSSEshouldbetoweedoutundeservingsecondarypatentsinordertopreventthe

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foreignoffices,withfullsubstantiveexaminationincertainfieldspursuanttothecountry’sdevelopmentandpublicinterestconsiderations.Whichevermodelisadopted,therollingoutofSSEmustbedoneinamannerconsistentwiththenondiscriminationrequirementsinArticle27.1oftheTRIPSAgreement.

evergreeningofperiodsofpatentexclusivity.Ontheotherhand,Indiaprovidesamodelprovisiononeliminatingevergreening.

TheadoptionofSSEwillalsobringthepatentsystemintoalignmentwiththeconstitutionalimperativeinsection33offairadministrativeaction,andwilladditionallyneedtoexpandthepresentnarrowstandingrules,inlinewithsection38oftheConstitution,toincludeawidedefinitionofan‘interestedparty’toanyproceedings.

iii.Fundamentally,adoptingaSSEapproachwhichtakesintoconsiderationanation’scapacityconstraintsandlegitimatepublichealthinterestbyprioritizingcertainsectorswouldnotconflictwiththeTRIPSAgreement.TheinterpretationofArticle27.1oftheTRIPSAgreementmustbeconductedinaccordancewiththeViennaConventionontheLawoftheTreaties.ThesaidArticleofTRIPSonlyreferstodiscriminationinrespectofthreehypotheses(theplaceofinvention,thefieldoftechnologyandwhetherproductsareimportedorlocallyproduced)andonlyinrelationtotheavailabilityand'patentrightsenjoyable'.Therefore,thatprovisioncouldnotbethebasisforacomplaintwheretheexaminationofpatents(ahypothesisnotcoveredinArticle27.1)isintroducedforaparticularfieldoftechnologiessincethepatentswouldstillbeavailableandthescopeandcontentofthepatentrightswouldnotbeaffected.

ThiscleararticulationofTRIPScomplianceiscorrectanditishighlyappropriatetoemphasisethis,givenunwarrantedclaimsofdiscriminationraisedbyindustrystakeholdersinthepast.

iv.WeareconsciousthattheimplementationofSSElikeanynewadministrativeproceduremayhaveteethingproblems.Forthisreason,CIPCisconsidering

Guardingagainstbacklogsisimportantbutitisevenmoreimportantthatonlyworthypatentsbegrantedunderstringentpatentabilitycriteria.Someforeignofficesthatare“highlyefficient”enforcelaxerstandardsthanthosethatSouthAfricashouldadopt.Therefore,SouthAfrica

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enteringintooutsourcingarrangementswithcertainpatentofficesthatareknowntobehighlyefficient.Thiswouldbeacontingencyagainsttheaccumulationofinordinatebacklogs.

shouldconsiderreferencetoorpartialrelianceonexaminationsincountrieswithmorestringentstandardssuchasIndiaandArgentina,andshouldconsiderhavingexaminerstrainedbythesepatentoffices,aswellasbyNGOsofferingtechnicalexpertise.

4.1.3PatentOpposition Ourcomments

i.AffordingthirdpartiesanopportunitytobringtheirresourcestobearandpresentrelevantinformationtopatentexaminersinanoppositionprocesscanaugmentthecapacityofCIPCtoconductSSE.

Thisisakeyprincipleofatransparentexaminationsystem.

Thepolicyshouldspelloutthepre-andpost-grantoppositionprocedures,withwidelocusstandirules,andadequateopportunityforthepublictomakeinputs.

ii.Revocationproceedingsentailtheprohibitivecostsandrisksoflitigation.SouthAfricashouldconsiderthemostefficientwaysofutilizingoppositionproceduresinlinewithinternationalbestpracticeandpursuanttostakeholderinput.

Thedtishouldarticulateamorecompletesetofrecommendationsthanthis.Oppositionproceduresshouldbeeasytouse,beexpeditious,shouldallowforboththeintroductionofevidenceandargument,andadverserulingsagainstoppositionsshouldbeappealable.

4.1.4PatentabilityCriteria Ourcomments

i.Article1oftheTRIPSAgreementreadwithArticles7and8giveWTOmemberstheflexibilitytoimplementandinterprettheTRIPSpatentabilityrequirementsinamannerconsistentwithinteralia,theirpublichealthconcerns.TheabsenceofSSEinSouthAfricarendersgovernmentunabletousethisflexibilityinthegrantof

PreviousiterationsofIPpolicycontainedstronglanguageregardingtheproscriptiononevergreening.Thestrictcriteriaforpatentabilityshouldbespeltoutindetail,assuggestedbelow.

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patents.

ii.InternationalbestpracticefromabroadrangeofsourcesshouldbeconsideredinordertodevelopanappropriateapproachforSouthAfrica.

Thisisaninadequatearticulationofthepolicyissuesatstakeintermsofpatentabilitycriteriaandthedti’spreferencesconcerningpolicychoicesthatshouldbemade.Thisissueisoneofthemostimportantpolicyreformsunderconsideration,secondonlytoSSE.SouthAfricahasanopportunitytoadoptstringentpatentabilitycriteriaanddisclosurerequirementsandmustdosotofulfilitsconstitutionalandhumanrightsobligations.

Laxstandardsallowpatentingofminormodifications/variationsofknownsubstances,ofnewpharmaceuticalformulations/dosages,andofnewusesofmedicines.Laxstandardscanalsocreatebarrierstoincrementalinnovationsandneededadaptationstomedicaltechnologies.LaxstandardsallowadditionalpatentbarriersandlongerperiodsofexclusivitythatwillinterferewithSouthAfrica’sgoalofdevelopingitslocalproductioncapacity.Therefore,aprimaryobjectiveofSouthAfricanpatentlawreformandSSEshouldbetoadoptstringentstandardsofpatentability(novelty,inventivestep,andindustrialapplicability)toweedoutundeservingsecondarypatentsinordertopreventtheevergreeningofperiodsofpatentexclusivity.Inparticular,SouthAfricashouldconsiderdisallowanceofso-calledMarkushclaimsandrepeateduseofdivisionalpatents.

4.1.5DisclosureRequirements Ourcomments

i.IntermsofArticle29ofTRIPS,membersshallrequirethatanapplicantforapatentshalldisclosetheinventioninamannersufficientlyclearandcompletefortheinventiontobecarriedoutbyapersonskilledintheart.ThispolicyinstrumentcanbeusedtoaugmentthecapacityofCIPCtoconductSSEinatimelyfashion.Moreover,itcanbeusedtofacilitatetechnologytransferwhichisofkeyimportanceifSouthAfricaistoreapthebenefitsofIPandisaccordinglyoneofthekey

Inadditiontorequiringfulldisclosureofallknownmethodsofworkingthepatent,includingidentificationofthebestknownmethod,andillustratingorexemplifyingtheinvention,SouthAfricacouldandshouldrequiredisclosureofpatentstatusinothercountries.Further,SouthAfricacouldandshouldrequiredisclosureoftheinternationalnonproprietaryname(INN)ofpharmaceutical-relatedpatentseitheratthetimeofapplicationorthereafterwhenanINNhasbeenassigned.

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objectivesoftheTRIPSAgreement.

ii.TheuseofdisclosurerequirementsinamannerthatutilisestheflexibilityintheTRIPSAgreementshouldbeconsidered.

Theneedtousealllegally-permissibleandavailableflexibilitieshaslongbeenaccepted.Thepolicyneednotgobackto‘shouldbeconsidered’(hereandunderfollowingprovisions).TheUNHighLevelPanelstatesunequivocallythatallTRIPSflexibilitiesmustbeadopted.

4.1.6ParallelImportation Ourcomments

i.Article6readtogetherwithfootnote6totheTRIPSAgreementgivesmemberstheflexibilitytodeterminetheirownregimesfortheexhaustionofIPRs.

Thisisindeedthecase.

ii.InSouthAfrica,parallelimportationisgovernedby1997amendmentstotheMedicinesandRelatedSubstancesAct101of1965(MedicinesAct),whichlegislationisadministeredbytheDepartmentofHealth(DOH).TherelevantprovisionappliesnotwithstandinganyrightsconferredintermsofthePatentsAct.ThiswouldsuggestthatthelackofutilizationofthisprovisiondoesnotrelatedirectlytoIPRs.Havingsaidthis,explicitlyincorporatingtotalinternationalexhaustionintothePatentsActwouldclarifymatters.

ThisFrameworkshouldacknowledgethatthecurrentregulatoryregimeconcerningparallelimportationisnotworkingandproposereformsforaneffectivescheme.Forexample,aspectsofregulation7ofGeneralRegulations,2003imposeunrealisticstricturesforthisflexibilitytobeeffective.ThdtishouldnegotiatewiththeDepartmentofHealthtorepealthese,whileretainingsection15C(b)oftheMedicinesActasaprovisionenablingparallelimportation.

Parallelimportationisalsogovernedbysection45(2)ofthePatentsAct(asamendedin2002),andisadministeredbythedti.

Thisprovisionshouldbeclarifiedtopermitparallelimportationundertheinternationalexhaustionregime,andincludebothbrandedandgenericproducts(asisthecaseinKenya).

Thereshouldbeproperalignmentoftheseparallelimportationprovisionsemanatingfromtherespectivedepartments.

iii.CommunicationandinformationsharingbetweenthedtiandDOHwouldbeimportantinaddressinganyantagonismbetweenrelevantprovisions,particularlyasDOHworkstowardimplementationoftherecently


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proposedamendmentstotheMedicinesAct.

4.1.7Exceptions Ourcomments

i.AsameansofstrikingabalancebetweentherightsofcreatorsandusersofIPRs,Article30oftheTRIPSAgreementallowsmemberstoprovidelimitedexceptionstopatentrights.


ii.SouthAfricaincorporatedtheearlyworking/“Bolar”exceptionina2002amendmenttothePatentsAct.Thisisanimportanttooltoassistgenericproducerstoenterthemarketassoonaspossibleoncethepatentee’sexclusiverightscease.

Thisisinfactthecase.

iii.thedtishouldengagetheDOH,genericproducersandotherrelevantstakeholderstoascertaintheeffectivenessofthisprovision.FurtherexceptionscouldbeconsideredifitisdeemedthattheycouldcontributetothefurtheranceoftheobjectivesoftheIPpolicytothebenefitofSouthAfrica.TheWorldHealthOrganization(WHO)forinstancehasrecommendedthatmemberStatesshouldconsider,whereappropriate,useofa“researchexception”toaddresspublichealthneedsindevelopingcountriesconsistentwithTRIPS.

Article30oftheTRIPSAgreementpermitsaresearchexceptionallowingbothcommercialandnon-commercialresearchonandwiththepatentproductorprocess.Inaddition,itallowsaneducationaluseexception,aprioruseexception,andanindividualformulationuseexception.

‘Otherrelevantstakeholders’shouldbeexplicitlydefinedtoincludecivilsocietyorganisationsrepresentingpeoplewhoneedaccesstomedicines,patientgroupsandpersonsrepresentingthepublicinterest.

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4.1.8VoluntaryLicenses Ourcomments

AvoluntarylicensecangenerallybedescribedasanagreementbetweenanIPRholderandanotherparty.IntheSouthAfricanpublichealthcontext,theotherpartyhastendedtobeagenericproducer.VoluntarylicensinghascontributedtogenericcompetitionparticularlywhereARVsusedinthetreatmentofHIV/AIDSareconcerned.Havingsaidthis,voluntarylicensesmaynotalwaysprovidetherequisitelevelofaccessinotherdiseaseareas.Hence,governmentrequiresamixofpolicyoptionsforinstanceswherevoluntarymechanismsproveinadequate.

Thegovernmentcanalsoregulatevoluntarylicenseswithrespecttocompetitionobjectivesandconcernsandshoulddoso.

Inparticular,anti-competitivepracticesinvoluntarylicensingmustbeavoidedby,forexample,requiringopenlicencestomultiplesuppliers,sothatvoluntarylicencesdonotbecomethevehicleforprotectingexclusivemarketsforlicenceholders,thusdefeatingtheaimofincreasingaccesstomedicines.

Additionally,theFrameworkshouldaddresstheissueofmarketsegmentation,fromtheperspectiveofenhancingaccess.

4.1.9CompulsoryLicenses Ourcomments

i.ThispolicyinstrumentisregardedasoneofthemostimportanttoolstoensurethatIPRsdonotundulyrestrictaccesstoessentialinnovations.Itsuseinthecontextoftheintersectionbetweenpatentsandpublichealthhasprovokedentirelibrariesofacademicwork,volumesofpolicydiscourseandsomeofthemostintensetreatynegotiationsofourtime.


ii.TheTRIPSAgreementsetsconditionsfortheuseofcompulsorylicenses.Providedthatthesearecompliedwith,itisnowamatterofcoursethatStateshavetherighttodeterminethegroundsuponwhichtheyissuecompulsory

ThissectionshouldstatethatSouthAfrica’scurrentlawdoesnotmakefulluseofthisflexibilitytodescribepermissiblegroundsforcompulsoryandgovernmentuselicenses.

Inaddition,consistentwiththecommitmenttoforegroundpublichealth,thevariousgroundsforcompulsorylicences

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licenses.

andgovernmentusebasedonpublichealthandaccessconsiderationsshouldbespeltout.Suchgroundsinclude:inadequatesupplytothemarket;desiretomakefixed-dosecombinationsofmedicinesownedbydifferentrightholders;desiretoallowcommercialisationofafollow-on,dependentpatentthatistechnologicallyimportant;desiretohavemultiplesourcesofsupplytopreventshortfallsofstock;anddesiretopromotelocalproductionwheretherehavebeenfailuresintechnologytransferfromrightholders.

iii.VoluntarylicensingarrangementssuchastheMedicinesPatentPool(MPP)arecrucialtotheSouthAfricangovernment’seffortstoprovideaccesstoaffordablemedicinesandwewillcontinuetoengageinthem.Havingsaidthis,inordertopromotesustainabilityofsupply,itisimportanttoensurethataworkablecompulsorylicensingsystemisinplacetoincreaseaffordabilityandrestrainanti-competitivepracticeswheretheneedarises.

Thisisveryimportanttoemphasise,especiallybecauseMPPlicensesareonlyinplacewithrespecttoHIVandHCVatpresent.

iv.ItisimportanttoacknowledgethatIPRscannotbeseenasthesoleimpedimenttoeffectiveutilizationofcompulsorylicensingasapolicyinstrument.SouthAfricaisyettoissueacompulsorylicensedespitethePatentsActprovidingforit.Thecurrenttenderingsystemisoneexampleofanon-IPrelatedimpedimenttotheuseofcompulsorylicensing.Measurestofacilitatecontractsthatallowtenderrecipientstomaximizeeconomiesofscaleshouldbeconsidered.Inthisregard,theWHOhasrecommendedthatcountriesshouldmonitorcarefullysupplyanddistributionchainsandprocurementpracticestominimizecoststhatcouldadverselyinfluencethepriceof

ItisnotaccuratetosaythatIPRsactasimpedimentstoeffectiveutilisationofcompulsorylicensing.Instead,thelegalFrameworkforcompulsorylicenceapplicationsisneedlesslyrestrictiveandneedstobereformed.

Indianlegislationprovidesformandatoryexportlicensesaddressingrequestsfromcountrieswithinsufficientmanufacturingcapacity.

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theseproductsanddevices.

v.Inaddition,itisimportanttoensurethatthecompulsorylicensingprocedureprovidedinourlegislationdoesnotresultinunnecessarydelaysorundueobstacles.Variousmeansofstreamliningthecompulsorylicensingprocessesshouldbeconsideredinaccordancewithinternationalbestpracticeandinconsultationwithstakeholders.ThefollowingobservationspertainingtothePatentsActwarrantconsideration:

Inadditiontostreamlining,attentionneedstobepaidtoexpandingthegroundsforcompulsorylicensesalongthelinessuggestedunder(ii)above.

4.1.9.1Judicialprocess Ourcomments

i.AllapplicationsforcompulsorylicensesinSouthAfricaaresubjecttoajudicialprocessbeforetheCommissionerofPatents.Thegrantofacompulsorylicenseisthereforesubjecttothetimeframesandexpensesthatapplytolitigation.ThiscanbeexacerbatedandaccessfurtherdelayedintheeventthatthedecisionoftheCommissionertograntalicenseisappealed.

Thisisakeyimpedimenttotheuseofcompulsorylicences.

ii.TheTRIPSAgreementdoesnotrequirethegrantofcompulsorylicensestobemadesubjecttoajudicialprocess.Amorestreamlinedandaccessibleadministrativeprocessshouldbeconsidered.

Thelawshouldbeamendedtosetupanadministrativetribunalofappropriatelyqualifiedpersonswithsoundunderstandingofbothourconstitutionalethosandthetechnicalaspects,toconsidercompulsorylicenceapplications.

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4.1.9.2Adequateremuneration Ourcomments

i.OneoftheTRIPSconditionsforthegrantofcompulsorylicensesisthattheIPRholdermustbepaidanadequateremuneration.ThePatentsActdoesnotcontainguidelinesonhowtoascertainwhatwouldconstituteadequateremunerationotherthanprovidinganon-exhaustivelistoffactorsthatmayberelevant.Theprovisionofguidelinescanassistpartiestoachievetimelyconclusionofthevoluntarylicensenegotiationsthataremandatoryincertaincases.Thiswouldpreventunduedelayinthevoluntarylicensenegotiationprocess.OneprecedentistheCanadaAccesstoMedicinesRegime(CAMR).

Thisisanecessaryandimportantmeasuretobeadopted.

ii.Guidelinesfordeterminingadequateremunerationshouldbeexploredasameanstostreamlinethecompulsorylicensingprocess.

Clearguidelinesneedtobedevelopedand,inparticular,shouldrequirelowpercentageroyaltypaymentsinordernottonullifytheprice-correctingeffectsofthelicence.

4.1.9.3Governmentuse Ourcomments

i.TheTRIPSAgreementexplicitlystatesthatpublicnon-commercialuseofpatentedsubjectmatterisnotsubjecttotherequirementofnegotiatingwithanIPRholder.TheSouthAfricanPatentsActgoesbeyondwhatisprovidedforinTRIPSbyrequiringMinistersofStatetoenterintosuchnegotiationsbeforeanapplicationtotheCommissionerofPatentscanbemade.

Thisisanunnecessarybarrierwhichmustbecorrected.

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ii.Theinclusionofthisrequirementmaycauseunwarranteddelaysandshouldbereviewed.

dtishouldrecommendthattherequirementofnegotiationsbedropped.

4.1.9.4Compulsorylicensesforexport Ourcomments

Intermsofcompulsorylicensingforexport,SouthAfricaplayedanimportantroleinraisingtheprofileoftheIPandpublicheathdebateattheWTOandhasjoinedthegrowingbodyofWTOmembersthathaveadoptedtheParagraph6mechanismthroughratification.Theparagraph6mechanismhashoweverbeenthesubjectofvariouscriticisms.TheSouthAfricangovernmentiscognizantofthestatedlimitationsandwillengagestakeholderstofindwaysofensuringthatourimplementationisassimplifiedaspossible.Inaddition,wewillengageconstructivelywithintheWTOstructurestofindwaysofstreamliningtheParagraph6mechanism.

IftheParagraph6optionistobeeffective,itshouldberevisedinordertoenableaswiftandexpedientexportofpharmaceuticalproductsproducedundercompulsorylicence.(asindicatedinthePanelReport).

4.1.9.5Compulsorylicensestoremedyanti-competitivepractices Ourcomments

i.Article31(k)allowsmemberstousecompulsorylicensingasaremedytoanticompetitivepractices.SuchlicensescanbeissuedwithoutcomplyingwithanumberofTRIPSconditions,mostnotably:priornegotiationwithpatentholders,beinglimitedtothepurposeforwhichitwasauthorized,andtherequirementof

Itisnotcorrectthatcompliancewiththerequirementthat‘theauthorisationbelimitedtothepurposeforwhichitwasgranted’isdispensedwithunderthisArticle.Rather,theArticlerequiresthatacompetentauthoritymayrefuseterminationofsuchauthorisationiftheconditionswhichgaverisetotheauthorisationinthefirstplacearelikelytorecur.

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beingpredominantlyfordomesticuse.

ii.Asmentionedabove,thelicensingprovisionsinthePatentsActdonottakefulladvantageofTRIPSflexibilities.ThejudicialprocessprovidedbythePatentsActisingeneral,morecumbersomethanrequiredinTRIPS.ThisisparticularlytrueofArticle31(k).


iii.Amorestreamlinedadministrativeprocessfortheissuanceofcompulsorylicensesshouldbeconsidered.Inaddition,itissuggestedthatguidancebeintroducedastowhichpracticeswouldbeconsideredanti-competitive.ThiscouldbedonebywayofanamendmenttothePatentsAct,alternativelyguidelinescouldbeissued.Eitherroutemustbepursuedinconsultationwithrelevantgovernmentinstitutionsandstakeholders.

Thisisaveryconstructiveideathatshouldbetakenforward.

Note,however,thatArticle44oftheTRIPSAgreementprovidesforjudiciallysanctionedcompulsorylicensesandSouthAfricashouldconsideradoptionofthesame.

4.1.10IPandCompetition Ourcomments

i.Intheory,thedevelopmentofnewmedicinesinvolveshighcostsandrisks,andforthisreasonIPprotectionisconsideredaninstrumentthatallowsinnovatorstorecoupinvestment.WithoutadequateIPprotection,thetheoryposits,theseinvestmentssimplywouldnotbemade.Currently,aglobaldebate,ledbytheWHO,isunderwayaroundincentivemodelsinthecontextofmedicines.

SouthAfricanhasaprogressivecompetitionframework,whichhasbeenutilisedwithsomesuccess,toenhanceaccesstomedicines(asalludedtointhe2TACcasesmentionedabove).InseekingabalancebetweenIPandcompetitioninterests,theCompetitionCommissionofSouthAfricasuggeststhatpotentialconflictsbetweenintellectualpropertyrightsandcompetitionmandatesshouldberesolvedaccordingtotheextenttowhichthe“long-termpro-competitivebenefits”ofapracticeoutweighits“short-term‘anti-competitive’effects.”Whilethegeneralprinciplehasbeenarticulated,

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therearenospecificguidelinesontheapplicationoftheCompetitionAct,2008toIP,noristhereanexpressprovisionfortheissuanceofacompulsorylicenceinthecaseofafindingofanti-competitiveconductbyIPrightsholders.Forfurtheranalysisandrecommendationsonthistopic,seehttp://www.undp.org/content/undp/en/home/librarypage/hiv-aids/using-competition-law-to-promote-access-to-medicine.

ii.Competitionregulationhasaroleinensuringthatpatentsarenotusedasplatformsforillegitimatelyextendingthemarketpower.Marketsformanypharmaceuticalsareinelastic.Furthermore,thereareaspectsoftheSouthAfricanmarketsforpharmaceuticalsthatincreasetheopportunitiesforanti-competitivepracticessuchastheirsmallandconcentratednature.Finally,itshouldbenotedthatfromapublicinterestperspective,purchasersofessentialmedicinesarenotordinaryconsumersinthattheirdemandisinelastic.Thereisgreatpublicinterestinensuringaccesstomedicines.TheSouthAfricancompetitionlawwasdevelopedasatransformationaldeviceintheearlydaysofpost-apartheidSouthAfrica.Itshouldthereforebeabletoaccommodatethesespecialfeaturesofmedicineconsumers.

See comments under 4.1.10 i. above.

iii.InaddressingtheinterfacebetweenIPandcompetition,theTRIPSAgreementgivesmembersscopetousecompetitionpolicyasaninstrumenttofacilitateaccesstomedicines.Article8onitsown,andinparticular,readthroughtheinterpretivelensoftheDohaDeclarationonTRIPSandPublicHealthempowersWTOmemberstotakemeasuresaimedatrestraininganti-competitive

TheprovisionsoftheCompetitionAct,alsoadministeredbythedti,shouldbealignedwiththeproposednewPatentsAct,andfurtherrefinedtoeliminatemonopolisticpracticessuchasthosesometimesconductedbytheinnovatorpharmaceuticalindustry.

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practices.

iv.Article31(k)ofTRIPSconcernscompulsorylicensestoremedyanti-competitivepracticeswhileArticle40empowersmemberstoprohibitanti-competitivelicensingpracticesandprovidesalargedegreeofdiscretionindefiningtheprohibitedpractices.


v.TheCompetitionAct89of1998(CompetitionAct)andthePatentsActcanbeusedtoactionthecompetitionrelatedTRIPSflexibilitiesandadvanceconsumerwelfare.

Chapter2oftheCompetitionActandvariouslicensingprovisionsinthePatentsActaremostpertinent.


vi.Chapter2oftheCompetitionActcoverspracticessuchashorizontalrestrictions,verticalrestrictionsandabuseofdominance.


vii.ThefamousHazelTaucase,whichwasspearheadedbycivilsociety,isapertinentmatter.AlthoughitwasresolvedbeforetheTribunalcouldconsiderthesubstantivemerits;thecasewasawatershedasitclarifiedthatcompetitionlawisanimportantinstrumenttoachieveanappropriatebalancebetweentheinterestsofthecreatorsandusersofIP.


viii.FewpartieshavesoughttousetheprovisionsoftheCompetitionActtoalleviateadverseimpactsofexclusiveIPRsonconsumerwelfareandbyextension,public


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health.OnefactoristherelativesmallnessoftheSouthAfricanpharmaceuticalmarket.Thisservesasadisincentivetogenericcompaniesincurringthecostoflitigation.Anotherfactoristhehighlytechnicalnatureoftherequisiteanalysis.Interestedpartiesarelikelytofacesuchdifficultiesgoingforwardgiventhecomplexityofthelegalandeconomicconsiderationsinvolvedaswellastherelativedearthofjurisprudentialsuccor.

ix.GuidelinesonIPandcompetitioncouldbedevelopedinlinewithinternationalbestpracticeandinconsultationwithrelevantgovernmentdepartmentsandstakeholders.


4.2Internationalbestpractice–aBRICSperspective

Ourcomments

i.Indevelopingtheappropriateapproachtotheissuesraisedabove(4.1)dueregardwillbegiventointernationalbestpractice,includingtheexperienceofcountriesinsimilarlevelsofdevelopmentsuchasBRICS.ItwillbeimportanttostudyhowthesecountrieshaveutilizedtheTRIPSflexibilitiestorespondtotheirspecificneeds.

WithintheBRICScontext,BrazilandIndiaarethemostobviouscomparators.Together,India,SouthAfricaandBrazilformtheclosestcomparisongroupwithinBRICS–allthreecountriesarediverse,multi-ethnic,relativelynewdemocracies,withstrongemergingeconomiesandsimilarincomedisparitiesandpublichealthconcerns.

Indiainstitutedacomprehensivepatentreformin2005(ThePatentsAmendmentAct2005),themainfeaturesofwhichare

(a)highstandardsofpatentabilitytoboostbothinnovationinthepharmaceuticalindustryaswellasfacilitateaccesstomedicines,

(b)dueprocessforpre-andpost-grantopposition,

(c)awidevarietyofmeasures,includingcompulsorylicensingprovisions,toensurecompliancebythe

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pharmaceuticalindustrywithconstitutionalrightsandsocietalconcerns.

Thoughunusualandboldattheoutset,Indianpatentlawhassincebeenvalidatedthroughnumerousjudicialoutcomes,andisnowuniversallyregardedascompatiblewiththeWTO’straderules,especiallyTRIPs.

In2013,abillwasintroducedinBrazil'sHouseofRepresentatives,namely,PL5.402/2013,whichsoughtextensivereformtothecountry'sIndustrialPropertyLaw.ThebillfollowedanexhaustiveanddetailedreportfromtheCenterforStrategicStudies&Debates,releasedintheBrazilianChamberofDeputies,entitled"Brazil'sPatentReform:InnovationTowardsNationalCompetitiveness,"andsubsequentlyreceivedsupportfromtheSubcommitteefortheIndustrialHealthComplex(CIS)oftheHouseofRepresentatives.A2014report.PL5.402/2013andsupplementallegislativeproposalsconcernedwithexpandingaccesstomedicines,togetherpresentastrong,evidence-basedrationaleforutilisingTRIPsflexibilities,andcloselyfollowthemodeloftheIndianlawasamendedin2005.

ii.TheSouthAfricangovernmentthroughthedtiinparticularparticipatesintherecentlyestablishedBRICSIPRCooperationMechanism(IPRCM).ThesaidinstitutionwillserveasanimportantinformationsharingforumthatcanaugmentthecollectiveinformationandhumancapitalresourcesofpolicymakersandimplementationagenciesinBRICScountriesaswellasdeepenmutualcooperation.

TheBRICSIPRCMshouldbeusedtonegotiatetrainingandtechnologicaltransferagreementswiththosepartnerswhohaveadoptedmeasurestoimproveaccesstomedicinesaselaboratedabove.

iii.Havingsaidthis,SouthAfrica’suniquedynamicsmustinformtheapproachtothecountry’sIPpolicy.


4.3Internationalcommitments Ourcomments

i.SouthAfricaispartytothefollowingmultilateraltreatiesin


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IP:

BerneConventionfortheProtectionofLiteraryandArtisticWorks(BerneConvention),sinceOctober1928;

ParisConventionfortheProtectionofIndustrialProperty(ParisConvention),sinceDecember1947;

WIPOConvention,sinceMarch1975;

TRIPSAgreement,sinceJanuary1995;

BudapestTreaty(DepositofMicro-organisms),sinceDecember1997;

PatentCooperationTreaty(PCT),sinceMarch1999.

ii.WiththeexceptionofTRIPSthesetreatiesarealladministeredbyWIPOwhiletheWTOadministeredTRIPSincorporatesthesubstantiveprovisionsoftheParisandBerneConventions.


iii.SouthAfricahasbeenpartytotheTRIPSAgreementsinceinceptionandisanactive,influentialparticipantintheTRIPSCouncil.TRIPShasbecomeafundamentalaspectoftheinternationalIPregimeandSouthAfricahasplayedanimportantroleinsafeguardingtheflexibilitiesavailabletomembers.Havingadoptedthe2030AgendaforSustainableDevelopment,andinparticular,SustainableDevelopmentGoal3,itisincumbentonSouthAfricatocontinueplayingthisrole.

SouthAfrica’sadvocacyroleshouldnowbetranslatedintoconcreteactions,suchasdomesticatingallavailableflexibilities.

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iv.WIPOmembershaveconcludednumeroustreatiestowhichSouthAfricaisnotparty.Itisimportantforcountriestosafeguardtheirpolicyspaceandnotassumeobligationsthatwouldnotbeinthenationalinterest.Ontheotherhand,treatiesareaimedatdealingwithimportantglobalchallengesthatcannotbeaddressedthroughdomesticinstrumentsduetotheirextra-territorialnature.Inaddition,certaintreatiescanassistcountriestoadvancetheiroffensiveintereststherebyincreasinggrossnationalincome(GNI).


v.InlightoftheprincipalsestablishedintheIPpolicy,SouthAfricashouldanalyzeWIPOtreatiestowhichwearenotpartyinordertodeterminewhethertheypresentopportunitiesthatcouldbenefitthecountrywhichwearecurrentlynotutilizing.


vi.AsidefromtheabovementionedIPtreaties,SouthAfricaispartytoseveralotherinternationalarrangementsthatareimplicatedbyIPsuchasWHO.Thatorganization’sConstitutionstatesthat“theobjectiveofWHOshallbetheattainmentbyallpeoplesofthehighestpossiblelevelofhealth”.Togiveeffecttothismandate,WHOplaysastrategicandcentralroleintherelationshipbetweenpublichealth,innovationandIP.

SouthAfricashouldgiveeffecttoitscommitments,especiallyundertheICESCR,intheformulationofitsIPpolicy.

vii.WHOhasbeenengagedineffortstoaddressidentifiedweaknessesintheglobalR&Dsystemwhichisreliantonmarketbasedincentivessuchaspatents.


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ThecurrentR&Dregimehasstimulatedsignificantinnovationsandwillcontinuetodosobutithasnotbeenabletoaddressissuessuchaslackofaffordability,limitedresearchwheremarketreturnsaresmalloruncertain(includingthe‘neglecteddiseases’thatpredominantlyaffecttheworld’spoorest),inefficientoverlapofresearchefforts,andoveruseofmedicinessuchasantibiotics.De-linkageofthemarketpricefromR&Dcosts,useofopenknowledgeinnovation,anduseoflicensingconditionstofavouraccess,areregardedascoreprinciplesformulatedbytheConsultativeExpertWorkingGrouponResearchandDevelopment:FinancingandCoordination(CEWG).Antimicrobialresistance(AMR)isconsideredaglobalpublichealththreat.Lackofnewtuberculosis(TB)medicinesisalsoapublichealthimperative.AnumberofstrategiestoaddressAMRhaverecentlybeenreported,theseincluderapiddiagnostictestsandR&DfornewantibioticsandantiTBmedicines.

viii.SouthAfricamustparticipateinR&DinitiativesandmultilateralIPforumsinacoordinatedfashionensuringthatthepositionsadoptedareconsistent.FormulatinggovernmentalpositionsundertheauspicesofanIMConIPwillensureacoordinatedapproach.

SouthAfrica’spolicyshouldcommittotheselaudableprinciplesproposedtoreducethecostsofmedicines,andshouldfurthercontributetothesustainabilityofalternativemodelsoffinancingR&Dformedicines.

ix.Intermsofregionalandbilateralarrangements,atrendhasemergedintermsofwhichstandardsofIPprotectionthatgobeyondwhatisrequiredbyTRIPS

ThisisanimportantprincipletoarticulateintheFrameworkandbeguidedbyintradenegotiations.

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arebeingpromoted.SouthAfricaandotherdevelopingcountriesworkedextremelyhardatmultilateralleveltoensurethattheflexibilitieswithintheTRIPSAgreementwereunequivocallyrecognizedaslegitimatepolicytools,particularlyastheypertaintopublichealth.ItiscrucialthatwedonoterodethegainsmademultilaterallybyassumingTRIPSplusIPobligationsinbilateralandregionalengagements.

x.AnIMConIPshouldexamineanytreatiesundernegotiationwhichcontainIPprovisionstoensurethattheycomplywiththeprinciplesoftheIPPolicy.

4.3.1GeographicalIndications(GIs) Ourcomments

i.SouthAfricandoesnothaveastatutedealingspecificallywithGIs,andalsodoesnothaveasuigenerisregistrationsystemforGIsinrespectofallkindsofproducts,howeverthispositionmaychangegivencertainlegislativeinitiativesunderway.ThefollowingstatutescontainreferencestoGIsordealwithindicationsofthegeographicaloriginofgoodsorservices:


ii.TradeMarksActno.194of1993;AgriculturalProductsStandardsActno.119of1990;LiquorProductsAct60of1989;andMerchandiseMarksAct17of1941.


iii.TheDepartmentofAgricultureForestryandFisheries(DAFF)has


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publisheddraftregulationsonGIswhichwereopenforpubliccomment.Continuedinter-Ministerialengagementisencouraged.

iv.AtmultilaterallevelthereareseveraldevelopmentsthathaveabearingontheprotectionofGIs.TRIPSprovidesfortheprotectionofGIsthroughArticles22,23and24.AdebatewhichhasstalledatthispointishowMemberswillagreetosetupamultilateralsystemfornotificationandregistrationofwinesandspiritsGIs.


v.SouthAfricahasagreedtoconcludeabilateralGIProtocolwiththeEUthatgoesbeyondwinesandspirits.This,however,doesnotchangeSouthAfrica’spositionattheWTOinrespectofthelimitedandnon-bindingnatureoftheestablishmentofaninternationalwinesandspiritsGIRegisterforinformationpurposesonly.


vi.WIPO’sLisbonSystemfortheInternationalRegistrationofAppellationsofOriginoffersameansofobtainingprotectionforanappellationoforigininthecontractingpartiestotheLisbonAgreement.TheLisbonSystemshouldbeconsideredbyanIMConIP.


5.In-BuiltAgenda

5.1Mediumterm Ourcomments

i.Thissectionproposessubstantiveissuesthatshouldbe


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addressedoncepolicyformulationontheimmediateissueshasbeensecured.ItalsosetsoutrecentdevelopmentsintermsofinternationalbestpracticeinIPpolicyformulationandsuggestswaysinwhichSouthAfricacanimplementthese.

ii.OneofthekeyaspectsoftheWIPODevelopmentAgendawasforWIPOtoplaceagreateremphasisondemand-sidedevelopmentalconcernsofdevelopingmembersinitsprovisionoftechnicalassistance.ThisisaptlycapturedinRecommendation10whichmandatesWIPO:

“ToassistmemberStatestodevelopandimprovenationalintellectualpropertyinstitutionalcapacitythroughfurtherdevelopmentofinfrastructureandotherfacilitieswithaviewtomakingnationalintellectualpropertyinstitutionsmoreefficientandpromotefairbalancebetweenintellectualpropertyprotectionandthepublicinterest.Thistechnicalassistanceshouldalsobeextendedtosub-regionalandregionalorganizationsdealingwithintellectualproperty”.


iii.Toimplementthisrecommendation,WIPOundertookseveralinitiativessuchastheformationoftheCommitteeonDevelopmentandIntellectualProperty(CIDP)andtheestablishmentofaprojectnamed:“ImprovementofNational,SubRegionalandRegionalIPInstitutionalandUserCapacity(DevelopmentAgendaProject


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DA_10_05)”.

iv.DevelopmentAgendaProjectDA_10_05wasconductedfrom2009-2012andservedasapilotprojectwiththeaimofdevelopingtoolsforIPpolicyformulation.Algeria(whichjoinedtheprojectin2011)DominicanRepublic,Mongolia,Moldova,TanzaniaandMaliparticipated.


v.TheprojectresultedinthesuccessfuldevelopmentandpublicationofacomprehensivemethodologytoolkitfortheformulationofNationalIPStrategies.


vi.DevelopmentAgendaProjectDA_10_05andtheresultingtoolkitweresubjecttoanexternalreviewwhichfoundthemethodologytobesufficientlyconsultativeandresponsivetotheneedsofmemberStates.Thereviewalsofoundthatthetoolkitisbothreplicableandadaptable.Thisoutcomeissupportedbythetoolkit’susebyatleast10othercountries.Indeed,ofthe29countriesthathaverecentlyconcludedorareintheprocessofformulatingtheirIPpolicies,manyaredoingsowiththeassistanceofWIPO.

ThetoolkitshouldbecriticallyassessedinlightofSouthAfrica’sneedswithregardtoaccesstoessentialtechnologies,anditsconstitutionalobligations.

Inparticular,thetoolkitdevelopedforSouthAfricashouldincludehumanrightsimpactassessmentsofproposedintellectualpropertypolicyasrecommendedbytheReportoftheSpecialRapporteurinthefieldofculturalrights:Patentpolicyandtherighttoscienceandculture.

vii.WIPOtechnicalassistancehasinthepastbeencriticizedforplacingtoomuchemphasisoncompliancewithinternationalIPstandards,whichweregenerallyseenasfavoringmultinationalcorporationsfromdevelopedcountrieswithoutdueregardforademand-drivenapproachthattakesintoconsiderationthe

ThetechnicalassistanceprovidedbyWIPOisstilloftenperceivedtobepro-IPRsratherthanexpresslypro-accessinthepublicinterest.AnexampleistheRwandanIPlaw(whichithelpedcraft).Whilethislawexcludesthepatentingofpharmaceuticalsuntil2033byvirtueofitspositionasanLDC,theWIPOassistancehasalsopromotedundulystrictenforcementandothermeasures.

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economicnuancesanddevelopmentobjectivesofcountriesreceivingthetechnicalassistance.Havingsaidthis,sincetheadoptionofthe45recommendationsofthedevelopmentagenda,WIPOhastakensignificantstepstoremedysuchconcernsanditsinputintotheformulationofnationalIPpoliciesindevelopingcountriesisevidenceofthisevolution.AstrongcaseinpointistheRwandaIPPolicyof2009whichislargelyregardedasaprogressiveandsoundinstrument.

viii.ItissuggestedthatSouthAfricafollowsanapproachthatisinlinewithWIPOestablishedmethodologiesbuttailoredtoSouthAfrica’sspecificdynamics.Here,abroadlyconstitutedIMConIPcouldworktogetherwiththeWIPOSecretariat.AsamemberofWIPO,thevastresourcesofthisinstitutionareavailabletoSouthAfricaandgovernmentwouldberemissinnotbringingthemtobear.

SAshouldadoptbestpracticesfromcountrieswhichhaveamorepro-accessorientation,suchasIndia,Brazil,Argentina;developitsIPpolicybasedonitsuniquecircumstances,andproactivelycontributetothedevelopmentofareformagendaatWIPOandotherfora.

Therearealsoothersourcesofspecialisedtechnicalassistanceonpro-developmentandbalancedIPpoliciesthatmightbeconsulted,includingSouthCentre,SARPAM,UNDP,andotherindependentIPexperts.

ix.ThefollowingsubstantiveissuesareproposedasworkingareasfortheIMCtodevelopincollaborationwithWIPOandotherexpertinstitutions:

IPRsinagriculture;

IPRsandbiotechnology/geneticresources;

IPRsandtheenvironment/climatechange/greentechnologies;

IPRsandtheinformalsector;

BrandingofSouthAfricangoodsandservices(collectivemarks,

Thislistshouldprioritisetheimperativesofadevelopmentalstate,andshouldswiftlyprogressfromtheimmediatetaskstoaddressthesecompellingandimportantmediumtermissues.

ItshouldalsoprioritiseHumanRightsinthecontextofIntellectualPropertyasthereisinadequateunderstandingoftheimportanceofhumanrightsforintellectualpropertypolicy.

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certificationmarksandGIs);

SafeguardingSouthAfricanemblemsandnationalicons;

IPRsandthegovernment;

CommercializationofIPRs;

IPRsandlocalizationandbeneficiation;

Policymakingintheinternationalarena;

IPRawareness&capacitybuilding;and

Enforcement.

x.Thislistisindicativeandnotexhaustive.Itwillberefinedinaccordancewithintergovernmentalandstakeholderconsultations.


5.2Monitoringandevaluation Ourcomments

i.SeverallegislativeinitiativeshavecommencedorbeenconcludedpriortotheformulationoftheNationalIPPolicy.Indigenousknowledgeandcopyright-relatedissuesaremostpertinent.Itisproposedthereforethattheseconstitutetheissuesthatwillbesubjecttomonitoringandevaluation.Thisallowsthefinalizationofexistinginitiatives–towhichsignificantresourceshavealreadybeencommitted-whileensuringanopportunityforalignmentwiththebroaderIPPolicy.

Manyconcernshavebeenraisedabouttheexistinglegislativeinitiativesparticularlyaroundcopyrightandtraditionalknowledge.TheapproachproposedforthisFrameworkshouldbeusedtoreviewsuchinitiatives,andthedtishouldseekalignmentwiththebroaderpolicyobjectivesarticulatedhere,suchastheprimacyofhumanrightsoverIPprotection.

ii.Thefollowingthemesare

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coveredintheexistinginitiatives:

a.Copyrightandrelatedissues,including:

IP&creativeindustries,

accesstoknowledge–librariesandarchives/disabledpersons/copyright

exceptionsandlimitations/digitaltechnologies,

IPRsinthedigitalage);and

b.Traditionalknowledge(TK)