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I. Preamble back to top
A. Text of the Preamble
Members,
Desiring to reduce distortions and impediments
to international trade, and taking into account the need to promote
effective and adequate protection of intellectual property rights, and
to ensure that measures and procedures to enforce intellectual property
rights do not themselves become barriers to legitimate trade;
Recognizing, to this end, the need for new
rules and disciplines concerning:
(a) the applicability of
the basic principles of GATT 1994 and of relevant international
intellectual property agreements or conventions;
(b) the provision of
adequate standards and principles concerning the availability, scope and
use of trade-related intellectual property rights;
(c) the provision of
effective and appropriate means for the enforcement of trade-related
intellectual property rights, taking into account differences in
national legal systems;
(d) the provision of
effective and expeditious procedures for the multilateral prevention and
settlement of disputes between governments; and
(e) transitional
arrangements aiming at the fullest participation in the results of the
negotiations;
Recognizing
the need for a multilateral framework of principles, rules and
disciplines dealing with international trade in counterfeit goods;
Recognizing
that intellectual property rights are private rights;
Recognizing
the underlying public policy objectives of national systems for the
protection of intellectual property, including developmental and
technological objectives;
Recognizing
also the special needs of the least-developed country Members in respect
of maximum flexibility in the domestic implementation of laws and
regulations in order to enable them to create a sound and viable
technological base;
Emphasizing
the importance of reducing tensions by reaching strengthened commitments
to resolve disputes on trade-related intellectual property issues
through multilateral procedures;
Desiring
to establish a mutually supportive relationship between the WTO and the
World Intellectual Property Organization (referred to in this Agreement
as “WIPO”) as well as other relevant international organizations;
Hereby
agree as follows:
B. Interpretation and Application of the Preamble
1. In India
— Patents (US), the Appellate Body referred to a part of the
preamble in its interpretation of Article
70.8(a):
“The Panel’s interpretation here [of Article
70.8(a)] is consistent also with the object and purpose of the TRIPS
Agreement. The Agreement takes into account, inter alia, ‘the
need to promote effective and adequate protection of intellectual
property rights’.”(1)
2. In EC — Trademarks and Geographical Indications, the
Panel referred to the preamble to confirm its observation that the text
of the national treatment obligation in Article 3.1 of the TRIPS
Agreement combines elements both from pre-existing intellectual property
conventions and GATT 1994:
“It is useful to recall that Article 3.1 of the TRIPS Agreement
combines elements of national treatment both from pre-existing
intellectual property agreements and GATT 1994. (…) This combination
of elements is reflected in the preamble to the TRIPS Agreement which
explains the purpose of the “basic principles” in Articles 3 and
4
(a term highlighted in the title of Part I)
“Recognizing, to this end, the need for new rules and
disciplines concerning:
(a) the applicability of the basic principles of GATT 1994 and of
relevant international intellectual property agreements or conventions;”(2)
3. In EC — Trademarks and Geographical Indications, the
Panel referred inter alia to the preamble to ascertain the object
and purpose of the TRIPS Agreement:
“The ordinary meaning of the terms in their context must also be
interpreted in light of the object and purpose of the agreement. The
object and purpose of the TRIPS Agreement, as indicated by Articles 9
through 62 and 70 and reflected in the preamble, includes the provision
of adequate standards and principles concerning the availability, scope,
use and enforcement of trade-related intellectual property rights. This
confirms that a limitation on the standards for trademark or GI
protection should not be implied unless it is supported by the text.”(3)
4. In EC — Trademarks and Geographical Indications, the
Panel referred to the preamble to confirm its view that “interested
parties” for the purposes of Article 22.2 can be “private parties”:
“Article 1.3 provides that “Members shall accord the treatment
provided for in this Agreement to the nationals of other Members”.
That includes the protection provided for in Article
22.2, which obliges
Members to provide legal means for “interested parties”. The
interested parties must qualify as “nationals of other Members” in
accordance with the criteria referred to in Article
1.3. These persons
can be private parties, which is reflected in the fourth recital of the
preamble to the agreement, which reads “[r]ecognizing that
intellectual property rights are private rights”.”(4)
II. Article 1
back to top
A. Text of Article 1
Article 1: Nature and Scope of Obligations
1.
Members shall give effect to the provisions of this Agreement.
Members may, but shall not be obliged to, implement in their law more
extensive protection than is required by this Agreement, provided that
such protection does not contravene the provisions of this Agreement.
Members shall be free to determine the appropriate method of
implementing the provisions of this Agreement within their own legal
system and practice.
2.
For the purposes of this Agreement, the term “intellectual
property” refers to all categories of intellectual property that are
the subject of Sections 1 through 7 of Part II.
3.
Members shall accord the treatment provided for in this Agreement
to the nationals of other Members.(1) In respect of the relevant
intellectual property right, the nationals of other Members shall be
understood as those natural or legal persons that would meet the
criteria for eligibility for protection provided for in the Paris
Convention (1967), the Berne Convention (1971), the Rome Convention and
the Treaty on Intellectual Property in Respect of Integrated Circuits,
were all Members of the WTO members of those conventions.(2) Any
Member availing itself of the possibilities provided in paragraph 3 of
Article 5 or paragraph 2 of Article 6 of the Rome Convention shall make
a notification as foreseen in those provisions to the Council for
Trade-Related Aspects of Intellectual Property Rights (the “Council
for TRIPS”).
(footnote original) 1 When “nationals” are referred
to in this Agreement, they shall be deemed, in the case of a separate
customs territory Member of the WTO, to mean persons, natural or legal,
who are domiciled or who have a real and effective industrial or
commercial establishment in that customs territory.
(footnote original) 2 In this Agreement, “Paris
Convention” refers to the Paris Convention for the Protection of
Industrial Property; “Paris Convention (1967)” refers to the
Stockholm Act of this Convention of 14 July 1967. “Berne Convention”
refers to the Berne Convention for the Protection of Literary and
Artistic Works; “Berne Convention (1971)” refers to the Paris Act of
this Convention of 24 July 1971. “Rome Convention” refers to the
International Convention for the Protection of Performers, Producers of
Phonograms and Broadcasting Organizations, adopted at Rome on 26 October
1961. “Treaty on Intellectual Property in Respect of Integrated
Circuits” (IPIC Treaty) refers to the Treaty on Intellectual Property
in Respect of Integrated Circuits, adopted at Washington on 26 May 1989.
“WTO Agreement” refers to the Agreement Establishing the WTO.
B. Interpretation and Application of Article 1
1. Article 1.1
(a) General
5. In China — Intellectual Property Rights, the Panel
considered that the overall language of Article 1.1 cannot justify
derogations from the obligations Members have under the TRIPS Agreement
with respect to its provisions on IP enforcement:
“The first sentence of Article 1.1 sets out the basic obligation
that Members “shall give effect” to the provisions of this
Agreement. This means that the provisions of the Agreement are
obligations where stated, and the first sentence of Article 61 so
states. The second sentence of Article 1.1 clarifies that the provisions
of the Agreement are minimum standards only, in that it gives Members
the freedom to implement a higher standard, subject to a condition. The
third sentence of Article 1.1 does not grant Members freedom to
implement a lower standard, but rather grants freedom to determine the
appropriate method of implementation of the provisions to which they are
required to give effect under the first sentence. The Panel agrees that
differences among Members’ respective legal systems and practices tend
to be more important in the area of enforcement. However, a coherent
reading of the three sentences of Article 1.1 does not permit
differences in domestic legal systems and practices to justify any
derogation from the basic obligation to give effect to the provisions on
enforcement.”(5)
(b) “Members shall give effect to the provisions of this Agreement”
6. In EC — Trademarks and Geographical Indications
(Australia), the Panel considered a claim that a WTO Member is obliged
to give effect to the provisions of the TRIPS Agreement before it is
able to offer more extensive protection for one particular category of
intellectual property right. The Panel noted that a Member is obliged to
give effect to the provisions of the Agreement with respect to each
category of intellectual property right irrespective of whether it
implements more extensive protection, then exercised judicial economy:
“The Panel notes that the first sentence creates an obligation for
Members to give effect to the provisions of the TRIPS Agreement and the
second sentence recognizes Members’ freedom to implement more
extensive protection, subject to a condition. After the expiry of the
transitional arrangements in Articles 65 and
66 (and 70.8 and
70.9), as
applicable, a Member is obliged to give effect to the provisions of the
Agreement with respect to each category of intellectual property right,
irrespective of whether it implements more extensive protection in the
same or another category of intellectual property right.”(6)
(c) “free to determine the appropriate method of implementing”
7. In India — Patents (US), the Appellate Body reviewed the
Panel’s finding that India did not meet its obligations under the
TRIPS Agreement in that it failed to provide “a sound legal basis to
preserve novelty and priority” of certain patent applications:
“[W]hat constitutes such a sound legal basis in Indian law? To
answer this question, we must recall first an important general rule in
the TRIPS Agreement. Article 1.1 of the TRIPS Agreement
states, in pertinent part:
‘Members shall be free to determine the appropriate method of
implementing the provisions of this Agreement within their own legal
system and practice.’
Members, therefore, are free to determine how best to meet their
obligations under the TRIPS Agreement within the context of their
own legal systems. And, as a Member, India is ‘free to determine the
appropriate method of implementing’ its obligations under the TRIPS
Agreement within the context of its own legal system.”(7)
8. In Canada — Patent Term, the Panel examined Canada’s
argument that Article 1.1 permitted it to maintain a term for patent
protection of 17 years calculated from the date of grant of a patent, in
spite of the minimum requirement, under Articles 33 and
70, of granting
patent protection for a period expiring 20 years from the date of filing
of such application. The Panel noted the discretion of Members, under
Article 1.1, to determine the appropriate method of implementing their
obligations under the TRIPS Agreement, but emphasized that such
discretion did not extend to choosing which obligations to comply with:
“Article 33 contains an obligation concerning the earliest
available date of expiry of patents, and Article 62.2 contains a
separate obligation prohibiting acquisition procedures which lead to
unwarranted curtailment of the period of protection. We recognize that
some curtailment is permitted by the text of these two provisions.
However, Article 1.1 gives Members the freedom to determine the
appropriate method of implementing those two specific requirements, but
not to ignore either requirement in order to implement another putative
obligation concerning the length of effective protection.”(8)
9. In EC — Trademarks and Geographical Indications (US), the
Panel rejected a claim that a condition for GI protection requiring
product inspections to take place not only in the country where
protection was claimed, but also in the country of origin, forced other
countries to adopt a particular set of rules to implement the TRIPS
Agreement:
“To the extent that this claim concerns the inspection structures
requirement for particular products, the Panel recognizes that these
requirements may require inspections to take place not only within the
European Communities but also within the territory of other WTO Members,
for example, where the specifications concern production processes or
other matters not related to the physical characteristics of the product
itself. The evidence before the Panel does not disclose that these
inspections concern other WTO Members’ system of protection but,
rather, only compliance with the product specifications, which are a
feature of the European Communities’ system of protection.
“Therefore, the evidence does not suggest that they are
inconsistent with the freedom granted under the third sentence of
Article 1.1. For this reason, the Panel rejects this claim.”(9)
10. In EC — Trademarks and Geographical Indications (US),
the Panel found that the European Communities was not obliged to ensure
that one particular measure implemented Article
22.2:
“In accordance with Article
1.1, the European Communities is free
to determine the appropriate method of implementing the provisions of
the Agreement within its own legal system and practice. It is not
obliged to ensure that this particular Regulation implements Article
22.2 where it has other measures that do so.”(10)
11. In China — Intellectual Property Rights, the Panel
considered the scope of the third sentence of Article
1.1:
“The third sentence of Article 1.1 does not grant Members freedom
to implement a lower standard, but rather grants freedom to determine
the appropriate method of implementation of the provisions to which they
are required to give effect under the first sentence.”(11)
2. Article 1.2
12. In US — Section 211 Appropriations Act, the Appellate
Body disagreed with the Panel’s conclusion that the categories of
intellectual property referred to in Article 1.2 are those referred to
in the titles of Sections 1 through 7 of Part
II:
“The Panel interpreted the phrase ‘intellectual property’
refers to all categories of intellectual property that are the subject
of Sections 1 through 7 of Part II’ (emphasis added) as if that phrase
read ‘intellectual property means those categories of intellectual
property appearing in the titles of Sections 1 through 7 of Part II.’ To our mind, the Panel’s interpretation ignores the plain words
of Article 1.2, for it fails to take into account that the phrase ‘the
subject of Sections 1 through 7 of Part II’ deals not only with the
categories of intellectual property indicated in each section title,
but with other subjects as well. For example, in Section 5 of
Part II, entitled ‘Patents’, Article 27.3(b) provides that Members
have the option of protecting inventions of plant varieties by sui
generis rights (such as breeder’s rights) instead of through
patents.”(12)
13. In EC — Trademarks and Geographical Indications, the
Panel referred to the definition of “intellectual property” in
Article 1.2 when interpreting that term as used in Article
3.1.(13)
14. In EC — Trademarks and Geographical Indications (US),
the Panel also referred to the definition of “intellectual property”
in Article 1.2 in relation to the obligations in Part III. See
paragraph
198 below.
3. Article 1.3
(a) “Nationals of other Members”
15. In EC — Trademarks and Geographical Indications, a
dispute which concerned industrial property, the Panel found that the
meaning of “nationals” in the phrase “nationals of other Members”
was that understood in the Paris Convention (1967) and under public
international law:
“With respect to the meaning of “nationals of other Members”
for the purposes of the TRIPS Agreement, WTO Members have, through
Article 1.3 of the TRIPS Agreement, incorporated the meaning of “nationals”
as it was understood in the Paris Convention (1967) and under public
international law. With respect to natural persons, they refer first to
the law of the Member of which nationality is claimed. With respect to
legal persons, each Member first applies its own criteria to determine
nationality.”(14)
(b) “Criteria for eligibility for protection provided for in the
Paris Convention (1967)”
16. In EC — Trademarks and Geographical Indications, the
Panel considered that Articles 2 and
3 of the Paris Convention (1967)
set out “criteria for eligibility for protection” for the purposes
of the TRIPS Agreement:
“In respect of the intellectual property rights relevant to this
dispute, it is not disputed that the criteria for eligibility for
protection that apply are those found in the Paris Convention (1967).
Articles 2 and 3 of the Paris Convention (1967) provide how nationals
and persons assimilated to nationals are to be treated. In the Panel’s
view, these are “criteria for eligibility for protection” for the
purposes of the TRIPS Agreement.”(15)
(c) Footnote 1 to Article 1.3
(i) “Separate customs territory Member of the WTO”
17. In EC — Trademarks and Geographical Indications, the
Panel interpreted the term “separate customs territory Member of the
WTO” as used in footnote 1 and accepted that it did not apply to the
European Communities:
“It is not disputed that the European Communities is a customs
territory. The key word appears to be “separate”, which can be
defined as follows:
“We highlight the definition “treat as distinct, (one thing)”,
given that a “separate customs territory Member of the WTO” is one
thing, and the word “distinct” corresponds to the term used in that
phrase in the French and Spanish versions, which are equally authentic.
It is not disputed that all Members of the WTO are separate, or
distinct, from one another. Most Members that are not part of a customs
union are a customs territory separate from other customs territories.
The word “separate” would be redundant if this is all it meant.
Logically, it must indicate a customs territory that is separate from
another Member in some other way.
The context elsewhere in the WTO Agreement bears this out. The term
“separate customs territory” is used in Article XXVI:5 of GATT
1994,
which treats a separate customs territory as a territory for which a
GATT Contracting Party, now a WTO Member, has international
responsibility, and is distinguished from a metropolitan territory. It
is also found in Article XXXIII of GATT
1994.
The object and purpose of the TRIPS Agreement includes the conferral
of intellectual property protection on the nationals of WTO Members.
Footnote 1 is a deeming provision for the purposes of nationality. This
confirms that the reason for the inclusion of footnote 1 was that
separate customs territories do not confer nationality and, hence, a
supplementary definition was required.
The European Communities does not form a separate part of the
territory of a country. Rather, the territory of the European
Communities is made up primarily of the territories in Europe, that is,
where relevant, the metropolitan territories, of a group of countries,
the number of which increased to 25 during this Panel proceeding. It is
neither a territory part of another country, nor a separate territory
for which other WTO Members have international responsibility. The
European Communities has informed the Panel that it has a citizenship
for natural persons, and, generally speaking, treats legal persons
organized under the laws of an EC member State as EC nationals under its
domestic law, as described above.
“Therefore, the Panel accepts the European Communities’
submission that it is not a ‘separate customs territory Member of the
WTO’ within the meaning of footnote 1 to the TRIPS
Agreement, and
finds that its nationals, for the purposes of the TRIPS Agreement, are
not defined by that footnote. The Panel would like to stress that its
finding is limited solely to footnote 1 of the TRIPS Agreement and is
not intended to be a finding of general application for other covered
agreements.”(16)
(ii) “domiciled”; “real and effective industrial and commercial
establishment”
18. In EC — Trademarks and Geographical Indications, the
Panel interpreted the criteria set out in footnote 1 as substitutes for
nationality, to be understood as they were under Article 3 of the Paris
Convention (1967):
“The text of the TRIPS Agreement contains a recognition that
discrimination according to residence and establishment will be a close
substitute for nationality. The criteria set out in footnote 1 to the
TRIPS Agreement are clearly intended to provide close substitute
criteria to determine nationality where criteria to determine
nationality as such are not available in a Member’s domestic law.
These criteria are “domicile” and “real and effective industrial
or commercial establishment”. They are taken from the criteria used
for the assimilation of nationals in Article 3 of the Paris Convention
(1967). It is clear that, in using these terms, the drafters of footnote
1 of the TRIPS Agreement chose terms that were already understood in
this preexisting intellectual property convention. Under Article 3 of
the Paris Convention (1967), “domicile” is not generally understood
to indicate a legal situation, but rather a more or less permanent
residence of a natural person, and an actual headquarters of a legal
person. A “real and effective industrial and commercial establishment”
is intended to refer to all but a sham or ephemeral establishment”(17)
III. Article 2 and Incorporated Provisions of the Paris Convention
(1967) back to top
A. Text of Article 2
Article 2: Intellectual Property Conventions
1.
In respect of Parts II, III and IV of this Agreement, Members
shall comply with Articles 1 through
12, and Article 19, of the Paris
Convention (1967).
2.
Nothing in Parts I to IV of this Agreement shall derogate from
existing obligations that Members may have to each other under the Paris
Convention, the Berne Convention, the Rome Convention and the Treaty on
Intellectual Property in Respect of Integrated Circuits.
B. Interpretation and Application of Article 2 and Incorporated
Provisions of the Paris Convention (1967)
1. Article 2.1 of the TRIPS Agreement
19. In US — Section 211 Appropriations Act, the Appellate
Body disagreed with the Panel’s interpretation that Article 2.1
obliged Members to comply with Articles 1 through
12 and 19 of the Paris
Convention (1967) only “in respect” of what is covered by Parts
II,
III and IV of the TRIPS Agreement. Instead, it found that Members do
have an obligation to provide protection to trade names in accordance
with Article 8 of the Paris Convention (1967) as incorporated by
Article
2.1 of the TRIPS Agreement:
“Article 2.1 explicitly incorporates
Article 8 of the Paris
Convention (1967) into the TRIPS Agreement.
The Panel was of the view that the words ‘in respect of’ in
Article 2.1 have the effect of ‘conditioning’ Members’ obligations
under the Articles of the Paris Convention (1967) incorporated into the TRIPS
Agreement, with the result that trade names are not covered. We
disagree.
…
[W]e reverse the Panel’s finding in paragraph 8.41 of the Panel
Report that trade names are not covered under the TRIPS Agreement
and find that WTO Members do have an obligation under the TRIPS
Agreement to provide protection to trade names.”(18)
2. Article 2(1) of the Paris Convention (1967) as incorporated in the
TRIPS Agreement
20. In US — Section 211 Appropriations Act, the Appellate
Body examined the national treatment obligation in Article 2(1) of the
Paris Convention (1967) as incorporated in the TRIPS Agreement, together
with the national treatment obligation in Article 3.1 of the TRIPS
Agreement: see paragraphs 39–44
below.
21. In EC — Trademarks and Geographical Indications, the
Panel observed that a finding of no less favourable treatment under
Article 3.1 of the TRIPS Agreement did not imply a violation of Article
2(1) of the Paris Convention (1967) as incorporated in the TRIPS
Agreement because the text of the latter provision does not include
those words:
“With respect to the claim under paragraph 1 of Article 2 of the
Paris Convention (1967), as incorporated by Article 2.1 of the TRIPS
Agreement, the Panel observes that, unlike Article 3.1 of the TRIPS
Agreement, Article 2(1) of the Paris Convention (1967) refers to “the
advantages that … laws now grant, or may hereafter grant” and not
to “no less favourable” treatment. Therefore, the Panel has not
actually reached a conclusion on this claim.”(19)
22. Later, the Panel found that the United States had not made a prima
facie case in support of its claim under Article 2(1) of the Paris
Convention (1967) as incorporated by the TRIPS Agreement because it had
not argued this claim separately:
“The United States has not separately argued its claim under
Article 2(1) of the Paris Convention (1967), as incorporated by Article
2.1 of the TRIPS Agreement with respect to the inspection structures
requirements.(20) Accordingly, the Panel concludes that, in this respect,
it has not made a prima facie case in support of its claim under
that provision.”(21)
3. Article 2(2) of the Paris Convention (1967) as incorporated in the
TRIPS Agreement
23. In EC — Trademarks and Geographical Indications, in
considering a claim under paragraph 2 of Article 2 of the Paris
Convention (1967), as incorporated by Article 2.1 of the TRIPS
Agreement, that an EC Regulation contained a requirement of domicile or
establishment, the Panel recalled its findings on the meaning of those
terms as understood under Article 3 of the Paris Convention
(1967). The
Panel then rejected the claim because, although persons who used a
protected GI would have a domicile or establishment in the European
Communities, this was not a requirement for protection:
“We have found that the design and structure of the Regulation will
operate to ensure that persons who use a protected GI, located in the
European Communities, will have a domicile or establishment within the
territory of the European Communities. We have also found that the
availability of protection for GIs located in third countries, including
WTO Members, is dependent on whether the third country in which the GI
is located satisfies the conditions of equivalence or reciprocity or
enters into an international agreement with the European Communities. It
is irrelevant to the protection of a GI located in a third country
whether or not the person who seeks protection has a domicile or
establishment in the European Communities.”(22)
4. Article 3 of the Paris Convention (1967) as incorporated in the
TRIPS Agreement
24. In EC — Trademarks and Geographical Indications, the
Panel interpreted the provision on assimilation of certain persons to
nationals in Article 3 of the Paris Convention (1967) as incorporated in
the TRIPS Agreement and found that it does not apply to persons who are
nationals of WTO Members:
“The rule in Article 3 of the Paris Convention (1967) only applies
to nationals of countries outside the Paris Union. According to
Article 1.3 of the TRIPS Agreement, these criteria shall be understood
as if “all Members of the WTO” were members of that Convention.
Therefore, for the purposes of the TRIPS Agreement, that rule of
assimilation only applies to persons that are nationals of a country that
is not a WTO Member. It does not apply to nationals of other WTO
Members, such as the United States. Therefore, it does not mean that all
persons who have a domicile or a real and effective industrial and
commercial establishment in a WTO Member are necessarily nationals of
that WTO Member for the purposes of the TRIPS Agreement.”(23)
5. Article 6 of the Paris Convention (1967) as incorporated in the
TRIPS Agreement
25. In US — Section 211 Appropriations Act, in the course of
considering claims under Article 6 quinquies A(1) of the Paris
Convention (1967) as incorporated in the TRIPS Agreement, and under
Article 15.2 of the TRIPS Agreement, the Appellate Body explained that
the general rule in Article 6(1) of the Paris Convention as incorporated
in the TRIPS Agreement reserves considerable discretion to WTO Members
but that that discretion must be exercised consistently with
internationally agreed grounds for refusing — and not refusing —
trademark registration:
“In this respect, we recall, once again, that Article 6(1) of the
Paris Convention (1967) reserves to each country of the Paris Union the
right to determine conditions for the filing and registration of
trademarks by its domestic legislation. The authority to determine such
conditions by domestic legislation must, however, be exercised
consistently with the obligations that countries of the Paris Union have
under the Paris Convention (1967). These obligations include
internationally agreed grounds for refusing registration, as
stipulated in the Paris Convention (1967).
The right of each country of the Paris Union to determine conditions
for filing and registration of trademarks by its domestic legislation is
also constrained by internationally agreed grounds for not denying
trademark registration. This means, by implication, that the right
reserved to each country of the Paris Union to determine, under Article
6(1), conditions for the filing and registration of trademarks includes
the right to determine by domestic legislation conditions to refuse
acceptance of filing and registration on grounds other than those
explicitly prohibited by the Paris Convention (1967).”(24)
6. Article 6bis of the Paris Convention (1967) as incorporated
in the TRIPS Agreement
26. In US — Section 211 Appropriations Act, the Panel found
that the obligation in paragraph 1 of Article 6bis to prohibit
the use of a well-known trademark in certain situations did not apply to
assertions of rights by an entity which had confiscated the well-known
trademark, or its successor-in-interest, who was not considered the
proper owner under national law:
“We agree with the parties that a WTO Member is not required to
give the benefit of Article 6bis to the confiscating entity or
its successor-in-interest; the competent authority of a WTO Member may
consider the well-known trademark as being the mark of the person who
owned the trademark prior to the confiscation.”(25)
7. Article 6ter of the Paris Convention (1967) as incorporated
in the TRIPS Agreement
27. At its meeting of 11 December 1995, the Council for TRIPS decided
on arrangements that apply with respect to implementation of the
obligations under the TRIPS Agreement stemming from the incorporation of
the provisions of Article 6ter of the Paris Convention (1967)
which contains certain prohibitions relating to the registration and use
as trademarks of state emblems, official hallmarks and emblems of
intergovernmental organizations.(26)
28. Article 3 of the Agreement between the World Intellectual
Property Organization and the World Trade Organization, done on 22
December 1995, (the “WIPO-WTO Agreement”), provides for procedures
relating to communication of emblems and transmittal of objections under
Article 6ter of the Paris Convention for the purposes of the
TRIPS Agreement.(27)
8. Article 6quinquies of the Paris Convention (1967) as
incorporated in the TRIPS Agreement
29. In US — Section 211 Appropriations Act, the Appellate
Body considered an argument that Article 6quinquies A(1) applied
to more than merely the form of a trademark, and found that:
“We also agree that the obligation of countries of the Paris Union
under Article 6quinquies A(1) to accept for filing and protect a
trademark duly registered in the country of origin ‘as is’ does not
encompass matters related to ownership.”(28)
9. Article 8 of the Paris Convention (1967) as incorporated in the
TRIPS Agreement
30. In US — Section 211 Appropriations Act, the Appellate
Body disagreed with the Panel’s interpretation that Article 2.1
obliged Members to comply with Articles 1 through
12 and 19 of the Paris
Convention (1967) only “in respect” of what is covered by Parts
II, III and IV of the TRIPS Agreement. Instead, it found that Members do
have an obligation to provide protection to trade names in accordance
with Article 8 of the Paris Convention (1967) as incorporated by
Article
2.1 of the TRIPS Agreement:
“Article 8 of the Paris Convention (1967) covers only the
protection of trade names; Article 8 has no other subject. If the
intention of the negotiators had been to exclude trade names from
protection, there would have been no purpose whatsoever in including
Article 8 in the list of Paris Convention (1967) provisions that were
specifically incorporated into the TRIPS Agreement. To adopt the
Panel’s approach would be to deprive Article 8 of the Paris Convention
(1967), as incorporated into the TRIPS Agreement by virtue of
Article 2.1 of that Agreement, of any and all meaning and effect… .
…
[W]e reverse the Panel’s finding in paragraph 8.41 of the Panel
Report that trade names are not covered under the TRIPS Agreement
and find that WTO Members do have an obligation under the TRIPS
Agreement to provide protection to trade names.”(29)
31.
In US — Section 211 Appropriations Act, the Appellate
Body found that Article 8 of the Paris Convention (1967) as incorporated
in the TRIPS Agreement does not determine who does or does not own a
trade name:
“We recall further our conclusion in … the section addressing
Article 16.1 of the TRIPS Agreement that neither the Paris
Convention (1967) nor the TRIPS Agreement determines who owns or
who does not own a trademark. We believe that the Paris Convention
(1967) and the TRIPS Agreement also do not determine who owns or
does not own a trade name. Given our view that Sections 211(a)(2) and
(b) relate to ownership, we conclude that these Sections are not
inconsistent with Article 2.1 of the TRIPS Agreement in
conjunction with Article 8 of the Paris Convention
(1967).”(30)
10.
Article 10(2) of the Paris Convention (1967) as incorporated in
the TRIPS Agreement
32. In EC — Trademarks and Geographical Indications (US),
the Panel found that the provision regarding persons who may be deemed
an “interested party” under Article 10(2) of the Paris Convention
(1967) did not set out a criterion for eligibility for protection for
the purposes of the TRIPS Agreement although it may provide guidance on
the interpretation of Articles 22 and
23 of the TRIPS Agreement:
“The Panel accepts that an “interested party” is a person who
is entitled to receive protection under Articles 22 and
23 of the TRIPS Agreement. However, in the Panel’s view,
Article 10(2) of the Paris
Convention (1967) does not set out a criterion for eligibility for
protection. Article 10(2) is a deeming provision for the term “interested
party” used in Article 9(3) of the Paris Convention
(1967), as made
applicable under Article 10(1). Once a person has qualified as a
national, Article 10(2) may provide guidance on whether that person may
be treated as an interested party for the purposes of Articles 22 and
23
of the TRIPS Agreement.”(31)
11. Article 2.2 of the TRIPS Agreement
33. In EC — Bananas (Article 22.6 — EC), the Arbitrators
followed Ecuador’s request under Article 22.2 of the DSU for
suspension of concessions and obligations, including certain obligations
under the TRIPS Agreement. In their decision, the Arbitrators addressed,
inter alia, the relationship between the WTO Agreement and the
obligations of WTO Members to each other arising under the four
conventions listed in Article 2:
“This provision can be understood to refer to the obligations that
the contracting parties of the Paris, Berne and Rome Conventions and the
IPIC Treaty, who are also WTO Members, have between themselves under
these four treaties. This would mean that, by virtue of the conclusion
of the WTO Agreement, e.g. Berne Union members cannot derogate from
existing obligations between each other under the Berne Convention. For
example, the fact that Article 9.1 of the TRIPS Agreement incorporates
into that Agreement Articles 1–21 of the Berne Convention with the
exception of Article 6bis does not mean that Berne Union members
would henceforth be exonerated from this obligation to guarantee moral
rights under the Berne Convention.”(32)
IV. Article 3
back to top
A. Text of Article 3
Article 3: National Treatment
1.
Each Member shall accord to the nationals of other Members
treatment no less favourable than that it accords to its own nationals
with regard to the protection(3) of intellectual property, subject to the
exceptions already provided in, respectively, the Paris Convention
(1967), the Berne Convention (1971), the Rome Convention or the Treaty
on Intellectual Property in Respect of Integrated Circuits. In respect
of performers, producers of phonograms and broadcasting organizations,
this obligation only applies in respect of the rights provided under
this Agreement. Any Member availing itself of the possibilities provided
in Article 6 of the Berne Convention (1971) or paragraph 1(b) of Article
16 of the Rome Convention shall make a notification as foreseen in those
provisions to the Council for TRIPS.
(footnote original)
3 For the purposes of Articles 3 and 4,
“protection” shall include matters affecting the availability,
acquisition, scope, maintenance and enforcement of intellectual property
rights as well as those matters affecting the use of intellectual
property rights specifically addressed in this Agreement.
2. Members may avail themselves of the exceptions permitted under
paragraph 1 in relation to judicial and administrative procedures,
including the designation of an address for service or the appointment
of an agent within the jurisdiction of a Member, only where such
exceptions are necessary to secure compliance with laws and regulations
which are not inconsistent with the provisions of this Agreement and
where such practices are not applied in a manner which would constitute
a disguised restriction on trade.
B. Interpretation and Application of Article 3
1. Article 3.1
(a) “Each Member”
34. The Panel in EC — Trademarks and Geographical Indications
examined an EC Regulation which provided for governments of countries
outside the European Communities to carry out certain essential
functions under its application and opposition procedures. The Panel
dismissed an argument that the Regulation did not require anything that
would be outside the scope of any WTO Member with a normally functioning
government:
“The obligation to accord national treatment with respect to a
measure of the European Communities is the obligation of the European
Communities. This is highlighted in the text of Article 3.1 of the TRIPS
Agreement under which “[e]ach Member” shall accord to the nationals
of other Members no less favourable treatment.
In accordance with its domestic law, the European Communities is
entitled to delegate certain functions under its measure to the
authorities of EC member States. However, under the Regulation, the
European Communities has purported to delegate part of this obligation
to other WTO Members, who must carry out these three steps in the
application procedures in order to ensure that no less favourable
treatment is accorded to their respective nationals. To that extent, the
European Communities fails to accord no less favourable treatment itself
to the nationals of other Members.”(33)
(b) “the nationals of other Members”
35. The Panel in EC — Trademarks and Geographical Indications
referred to the definition in Article 1.3 of the phrase “the nationals
of other Members” used in Article 3.1:
“Article 1.3 defines “nationals of other Members” in order to
determine the persons to whom Members shall accord treatment, which
includes national treatment.”(34)
(c) “treatment no
less favourable”
36. Indonesia — Autos concerned the consistency of Indonesia’s
National Car Programme with several WTO agreements, including claims
that the provisions of the programme discriminated against nationals of
other WTO Members with respect to trademarks, in violation of Article
3.1. With respect to the claim relating to the acquisition of
trademarks, the Panel rejected the United States’ claim that
Indonesian law was according less favourable treatment to foreign
nationals than to Indonesian nationals. The Panel saw the Indonesian law
as merely stipulating, in a non-discriminatory manner, that only certain
signs could be used as trademarks:
“The issue to be examined therefore in regard to the United States’
claim relating to the ‘acquisition’ of trademarks is whether, under
the Indonesian law and practice which is before us, the treatment
accorded to foreign nationals in respect of the acquisition of trademark
rights, through the applicable procedures, is less favourable than that
accorded to the Indonesian company in the National Car Programme. We do
not consider that any evidence has been produced in this case to support
such a claim… . The fact that only certain signs can be used as
trademarks for meeting the relevant qualifications under the National
Car Programme, and many others not, does not mean that trademark rights,
as stipulated in Indonesian trademark law, cannot be acquired for these
other signs in a non-discriminatory manner.”(35)
37. Equally, with respect to the argument that less favourable
treatment was being accorded by the regulations pertaining to the
maintenance of trademarks, the Panel could not discern any less
favourable treatment under Indonesian law for foreign nationals:
“We do not accept this argument for the following reasons. First,
no evidence has been put forward to refute the Indonesian statement that
the system, in requiring a new, albeit Indonesian-owned, trademark to be
created, applies equally to pre-existing trademarks owned by Indonesian
nationals and foreign nationals. Second, if a foreign company enters
into an arrangement with a Pioneer company, it would do so voluntarily,
with knowledge of any consequent implications for its ability to
maintain pre-existing trademark rights, as indeed the United States
itself has acknowledged in its submissions to the Panel.”(36)
38. The Panel in Indonesia — Autos also cautioned against
construing the national treatment obligation under Article 3 of the
TRIPS Agreement as addressing also issues of tariffs, subsidies or other
measure with respect to domestic companies which could have an indirect
impact on the maintenance of trademark rights by foreign nationals:
“In considering this argument, we note that any customs tariff,
subsidy or other governmental measure of support could have a ‘de
facto’ effect of giving such an advantage to the beneficiaries of this
support. We consider that considerable caution needs to be used in
respect of ‘de facto’ based arguments of this sort, because of the
danger of reading into a provision obligations which go far beyond the
letter of that provision and the objectives of the Agreement. It would
not be reasonable to construe the national treatment obligation of the
TRIPS Agreement in relation to the maintenance of trademark rights as
preventing the grant of tariff, subsidy or other measures of support to
national companies on the grounds that this would render the maintenance
of trademark rights by foreign companies wishing to export to that
market relatively more difficult.”(37)
39. In US — Section 211 Appropriations Act, the Appellate
Body considered a measure that, on a plain reading, afforded “differential
treatment” between a Member’s own nationals and nationals of other
countries, and quoted from the GATT panel report in US — Section
337:
“That panel reasoned that ‘the mere fact that imported products
are subject under Section 337 to legal provisions that are different
from those applying to products of national origin is in itself not
conclusive in establishing inconsistency with Article III:4 [of
GATT].’
That panel stated further that:
‘[I]t would follow … that any unfavourable elements of
treatment of imported products could be offset by more favourable
elements of treatment, provided that the results, as shown in past
cases, have not been less favourable. [E]lements of less and more
favourable treatment could thus only be offset against each other to the
extent that they always would arise in the same cases and necessarily
would have an offsetting influence on the other. (emphasis added)’
And that panel, importantly for our purposes, concluded that:
‘… while the likelihood of having to defend imported products
in two fora is small, the existence of the possibility is inherently
less favourable than being faced with having to conduct a defence in
only one of those fora. (emphasis added)’”(38)
40. In US — Section 211 Appropriations Act, the Appellate
Body accepted that discriminatory treatment imposed by a measure could
be offset in practice:
“Yet, to fulfill the national treatment obligation, less favourable
treatment must be offset, and thereby eliminated, in every
individual situation that exists under a measure. Therefore, for this
argument by the United States to succeed, it must hold true for all Cuban
original owners of United States trademarks, and not merely for some of
them.”(39)
41. In the same report, the Appellate Body dismissed an argument that
certain discriminatory treatment was offset in practice by another
measure which provided unfavourable treatment to the Member’s own
nationals:
“We disagree. We do not believe that Section 515.201 of the CACR
would in every case offset the discriminatory treatment imposed
by Sections 211(a)(2) and (b). For this argument by the United States to
hold true in each and every situation, the scope of the phrase ‘having
an interest in’ in Section 515.201 would necessarily have to overlap
in coverage with the scope of the phrase ‘used in connection with’
in Sections 211(a)(2) and (b). However, the United States was unable to
point to evidence substantiating that the different standards used in
Section 515.201 and in Sections 211(a)(2) and (b) overlap completely. We
are, therefore, not satisfied that Section 515.201 would offset the
inherently less favourable treatment present in Sections 211(a)(2) and
(b) in each and every case. And, because it has not been shown by the
United States that it would do so in each and every case, the less
favourable treatment that exists under the measure cannot be said to
have been offset and, thus, eliminated.”(40)
42. In the same report, the Appellate Body dismissed an argument that
certain discriminatory treatment was offset in practice by the
availability of a particular administrative procedure:
“This [procedure] could eliminate less favourable treatment in
practice. Yet, the very existence of the additional ‘hurdle’
that is imposed by requiring application to OFAC is, in itself,
inherently less favourable. Sections 211(a)(2) and (b) do not apply to
United States original owners; no application to OFAC is required. But
Cuban original owners residing in the ‘authorized trade territory’
must apply to OFAC. Thus, such Cuban original owners must comply with an
administrative requirement that does not apply to United States original
owners. By virtue alone of having to apply to OFAC, even Cuban original
owners that reside in the ‘authorized trade territory’ described in
Section 515.332 are treated less favourably than United States original
owners. So, in this second situation, the discrimination remains.”(41)
43. In the same report, the Appellate Body dismissed an argument that
a discretionary measure applicable only to nationals of foreign
countries, but which had been consistently applied in a way which offset
any discrimination, did not provide less favourable treatment. Although
the Appellate Body agreed with the Panel that it could not assume that
the discretionary executive authority would be exercised inconsistently
with WTO obligations, it found that this measure violated the national
treatment obligation in Article 2(1) of the Paris Convention (1967) (as
incorporated in the TRIPS Agreement) and Article 3.1 of the TRIPS
Agreement, for the following reason:
“The United States may be right that the likelihood of having to
overcome the hurdles of both Section 515.201 of Title 31 CFR and Section
211(a)(2) may, echoing the panel in US — Section 337, be small.
But, again echoing that panel, even the possibility that
non-United States successors-in-interest face two hurdles is inherently
less favourable than the undisputed fact that United States
successors-in-interest face only one.”(42)
44. The Panel in EC — Trademarks and Geographical Indications
examined an EC Regulation that contained two different sets of
procedures for the registration of GIs for agricultural products and
foodstuffs. The Panel found that one set applied to the names of
geographical areas located in the European Communities and the other
applied to the names of geographical areas located in third countries
outside the European Communities. The second set contained additional
conditions on the availability of protection which, the Panel found,
modified the effective equality of opportunities as regards the
protection of intellectual property:
“The Panel considers that those conditions modify the effective
equality of opportunities to obtain protection with respect to
intellectual property in two ways. First, GI protection is not available
under the Regulation in respect of geographical areas located in third
countries which the Commission has not recognized under Article
12(3).
The European Communities confirms that the Commission has not recognized
any third countries. Second, GI protection under the Regulation may
become available if the third country in which the GI is located enters
into an international agreement or satisfies the conditions in Article
12(1). Both of those requirements represent a significant “extra
hurdle” in obtaining GI protection that does not apply to geographical
areas located in the European Communities.”(43)
45. In EC — Trademarks and Geographical Indications the two
sets of procedures in the EC Regulation also contained differences as
regards application procedures which required applications for GIs
located in an EC member State to be filed with the EC member State
government and applications for GIs located outside the European
Communities to be filed with the third country government. The Panel
found that this modified the effective equality of opportunities as
regards the protection of intellectual property:
“An EC member State has an obligation to establish application
procedures for the purposes of the Regulation. Under Community law, an
EC member State has an obligation to examine an application and decide
whether it is justified and, if it is justified, to forward it to the
Commission. A group or person who submits an application in an EC member
State may enforce these obligations through recourse to judicial
procedures based on the Regulation. In contrast, a third country
government has no obligation under Community law or any other law to
examine an application or to transmit it or any other document to the
Commission. A group or person who submits an application in a third
country has no right to such treatment.
Therefore, applicants for GIs that refer to geographical areas
located in third countries do not have a right in the application
procedures that is provided to applicants for GIs that refer to
geographical areas located in the European Communities. Applicants in
third countries face an “extra hurdle” in ensuring that the
authorities in those countries carry out the functions reserved to them
under the Regulation, which applicants in EC member States do not face.
Consequently, certain applications and requisite supporting documents
may not be examined or transmitted. Each of these considerations
significantly reduces the opportunities available to the nationals of
other WTO Members in the acquisition of rights under the Regulation
below those available to the European Communities’ own nationals.”(44)
46. However, the Panel in EC — Trademarks and Geographical
Indications (Australia) did not uphold a claim that features
of an EC Regulation that provided for the participation of EC member
State representatives in the Regulation’s implementing procedures
accorded less favourable treatment for non-EC nationals for want of
evidence:
“The Panel does not consider that these features of the Regulation
“as such” compel any different treatment of different GIs. Under the
national treatment obligations of the TRIPS Agreement, evidence is
required that, in the application of these procedures, the authorities
cannot, do not or will not apply the Regulation in the same way to the
nationals of other Members and the European Communities’ own
nationals. Australia has not provided any such evidence.”(45)
47. The Panel in EC — Trademarks and Geographical Indications
found that, given that, on its face, certain provisions in the EC
Regulation discriminated according to the location of GIs, they were
formally identical vis-à-vis the nationals of different Members.
However, after referring to the passage from the GATT Panel Report in US
— Section 337 set out above at para. 39, and the conclusion of the
Appellate Body in Korea — Various Measures on Beef that “[a]
formal difference in treatment between imported and like domestic
products is thus neither necessary, nor sufficient, to show a violation
of Article III:4”, the Panel found that formal identity of treatment
was not dispositive of a claim under Article 3.1:
“We consider that this reasoning applies with equal force to the no
less favourable treatment standard in Article 3.1 of the TRIPS
Agreement. In our view, even if the provisions of the Regulation are
formally identical in the treatment that they accord to the nationals of
other Members and to the European Communities’ own nationals, this is
not sufficient to demonstrate that there is no violation of Article 3.1
of the TRIPS Agreement.”(46)
48. The Panel in US — Section 211 Appropriations Act, in a
finding with which the Appellate Body agreed, found that the appropriate
standard of examination under Article 3.1 of the TRIPS Agreement was the
“effective equality of opportunities” standard enunciated by the
GATT Panel in US — Section 337. The Panel quoted with approval
the following findings of that GATT Panel on the “no less favourable”
treatment standard under Article III:4 of GATT 1947:
“The words ‘treatment no less favourable’ in paragraph 4 call
for effective equality of opportunities for imported products in respect
of the application of laws, regulations and requirements affecting the
internal sale, offering for sale, purchase, transportation, distribution
or use of products. This clearly sets a minimum permissible standard as
a basis.”(47)
49. The Panel in EC — Trademarks and Geographical Indications
referred to the above passage and applied the same standard of
examination in the context of Article 3.1 of the TRIPS
Agreement:
“Therefore, the Panel will examine whether the difference in
treatment affects the “effective equality of opportunities” between
the nationals of other Members and the European Communities’ own
nationals with regard to the “protection” of intellectual property
rights, to the detriment of nationals of other Members.”(48)
50. The Panel in EC — Trademarks and Geographical Indications
also referred to the Appellate Body’s interpretation of the “no less
favourable” treatment standard under Article III:4 of GATT 1994 in US
— FSC (Article 21.5 — EC) and applied it in the context of
Article 3.1 of the TRIPS Agreement:
“Under Article III:4 of GATT
1994, the Appellate Body in US —
FSC (Article 21.5 — EC) has explained its approach to the
examination of whether measures affecting the internal sale of products
accord “treatment no less favourable” as follows:
“The examination of whether a measure involves ‘less favourable
treatment’ of imported products within the meaning of Article
III:4 of the GATT 1994 must be grounded in close scrutiny of the ‘fundamental
thrust and effect of the measure itself’. This examination cannot rest
on simple assertion, but must be founded on a careful analysis of the
contested measure and of its implications in the marketplace. At the
same time, however, the examination need not be based on the actual
effects of the contested measure in the marketplace.”
“Similarly, in the present dispute, the Panel considers it
appropriate to base its examination under Article 3.1 of the TRIPS
Agreement on the fundamental thrust and effect of the Regulation,
including an analysis of its terms and its practical implications.
However, as far as the TRIPS Agreement is concerned, the relevant
practical implications are those on opportunities with regard to the
protection of intellectual property. The implications in the marketplace
for the agricultural products and foodstuffs in respect of which GIs may
be protected are relevant to the examination under Article III:4 of GATT
1994, considered later in this report.”(49)
51. The Panel in EC — Trademarks and Geographical Indications
then decided that it should compare the effective opportunities under
the EC Regulation of all EC nationals with those of all nationals of
other WTO Members, irrespective of where their respective GIs were
located. It declined to compare the opportunities of EC nationals
seeking to protect a GI located in the European Communities only with
those of nationals of other WTO Members seeking to protect a GI located
in the European Communities, or the opportunities of EC nationals
seeking to protect a GI located outside the European Communities only
with those of nationals of other WTO Members seeking to protect a GI
located outside the European Communities:
“The Panel recalls that the standard of examination is based on “effective
equality of opportunities”. It follows that the nationals that are
relevant to an examination under Article 3.1 of the TRIPS Agreement
should be those who seek opportunities with respect to the same type of
intellectual property in comparable situations. On the one hand, this
excludes a comparison of opportunities for nationals with respect to
different categories of intellectual property, such as GIs and
copyright. On the other hand, no reason has been advanced as to why the
equality of opportunities should be limited a priori to rights
with a territorial link to a particular Member.
The Panel therefore considers it appropriate for the purposes of this
claim to compare the effective equality of opportunities for the group
of nationals of other Members who may wish to seek GI protection under
the Regulation and the group of the European Communities’ own
nationals who may wish to seek GI protection under the Regulation. On
this approach, there is no need to make a factual assumption that every
person who wishes to obtain protection for a GI in a particular Member
is a national of that Member.”(50)
(d) “own nationals”
52. The Panel in EC — Trademarks and Geographical Indications,
after interpreting the word “nationals” in Article 1.3 (see
paragraph 15 above), considered that the way in which a Member defined
its own nationals could also be subject to review:
“The meaning of “nationals” under public international law is
also relevant to the meaning of a Member’s “own nationals”. Whilst
the TRIPS Agreement does not create obligations for a Member to accord
treatment to its own nationals, it does refer to the treatment that each
Member accords to its own nationals as the benchmark for its obligation
to accord national treatment under Article 3.1, as well as under the
other national treatment obligations incorporated by reference,
including Article 2 of the Paris Convention
(1967). To that extent, the
way in which a Member defines its own nationals can also be subject to
review for the purposes of determining conformity with its national
treatment obligations under the TRIPS Agreement.”(51)
53. In that case the Panel accepted the European Communities’
definition that its “own nationals” were the nationals of EC member
States. In the case of legal persons, nationality was determined by
reference to various criteria including the place of incorporation,
company seat or a combination of such criteria:
“The European Communities has explained to the Panel that, with
respect to natural persons, under the domestic law of the European
Communities, any person who is a national of an EC member State is a
citizen of the European Union and, accordingly, an EC national. It has
explained that, with respect to legal persons, the domestic law of the
European Communities does not contain a specific definition of
nationality, but nor does the domestic law of many other WTO Members.
However, the European Communities informs the Panel that any legal
person considered a national under the laws of an EC member State would
also be an EC national. The criteria used by the EC member States to
determine the nationality of a legal person may vary and include
criteria such as the place of incorporation and the place of the seat of
the company or a combination of such criteria.
The United States has not challenged the criteria used by the
European Communities to determine nationality. The Panel notes that
these criteria appear to be the same as those used in public
international law. Therefore, the Panel can use them to determine which
persons are “nationals” under Article 3.1 of the TRIPS
Agreement.”(52)
54. The Panel in EC — Trademarks and Geographical Indications
(US) rejected an argument that product inspection requirements in an
EC Regulation, under which the EC would apply the same criteria and
requirements to foreign and domestic applications for GI protection, in
practice accorded less favourable treatment inconsistently with Article
3.1:
“The United States argues that these provisions, in practice,
accord less favourable treatment to the nationals of other Members who
enjoy GI protection without inspection structures, or without inspection
structures that would satisfy Article 10 of the Regulation, in the
territory of other WTO Members. Specifically, it asserts that certain
holders of certification marks, collective marks and common law rights
would not satisfy the requirements of Article 10(3) and standard
EN45011, for instance, with respect to the independence of the
inspection body from the producers.
The Panel recalls that the European Communities’ obligation under
Article 3.1 of the TRIPS Agreement is to accord no less favourable
treatment to the nationals of other Members than it accords to its own
nationals. The benchmark for the obligation is the treatment accorded by
the European Communities to the European Communities’ own
nationals. The treatment accorded by other Members to their own
respective nationals is not relevant to this claim. The level of
protection in the country of origin does not affect GI protection in the
country where GI protection is sought under the TRIPS Agreement, except
to the extent that a lack of GI protection in the country of origin
provides a ground to deny GI protection in accordance with
Article 24.9.
The Panel agrees with the European Communities that WTO Members are
entitled to aim for objective assessment of product conformity, provided
that they implement this objective in a WTO-consistent manner. The
implication of the United States’ argument would be to oblige the
European Communities to recognize forms of protection granted by the
United States. This would be a kind of reverse equivalence condition.”(53)
(e) “with respect to the protection of intellectual property”
55. In US — Section 211 Appropriations Act, the Appellate
Body applied to trade names its findings with regard to trademarks in
respect of Article 2.1 of the TRIPS Agreement in conjunction with
Article 2(1) of the Paris Convention, and Article 3.1 of the TRIPS
Agreement.(54)
56. The Panel in EC — Trademarks and Geographical Indications
examined each aspect of the Regulation at issue that was the subject of
a national treatment claim in terms of the definition of “protection”
of intellectual property set out in footnote 3 (see para. 58
below).
(f) Footnote 3
57. The following passage in Indonesia — Autos illustrates
the Panel’s approach to the relationship between Article 3 and other
provisions of the TRIPS Agreement:
“As is made clear by the footnote to Article 3 of the TRIPS
Agreement, the national treatment rule set out in that Article does not
apply to use of intellectual property rights generally but only to ‘those
matters affecting the use of intellectual property rights specifically
addressed in this Agreement’. In putting forward its claim on this
point, the United States has developed arguments relating to the use of
trademarks specifically addressed by Article 20 of the TRIPS
Agreement.
It is the first sentence of this Article, which is entitled ‘Other
Requirements’, to which the United States has made reference.
The main issues before us in examining this claim of the United
States are therefore: first, is the use of a trademark to which the
Indonesian law and practices at issue relates ‘specifically addressed’
by Article 20; and, second, if so, does this aspect of the system
discriminate in favour of Indonesian nationals and against those of
other WTO Members.”(55)
58. The Panel in EC — Trademarks and Geographical Indications
examined each aspect of the Regulation at issue that was the subject of
a national treatment claim in terms of the definition of “protection”
of intellectual property set out in footnote 3. It found that the
applicability of the Regulation, the application procedures, the
objection procedures, the product inspection structures and a labelling
requirement all fell within the scope of footnote
3:
“The national treatment obligation in Article 3 of the TRIPS
Agreement applies “with regard to the protection of intellectual
property”. Footnote 3 provides an inclusive definition of the term “protection”
as used in Articles 3 and 4.”(56)
…
“Article 12(1) refers to how the Regulation “may apply”, which
is a reference to the availability of intellectual property
rights in relation to “designations of origin” and “geographical
indications”, as defined in the Regulation.”(57)
…
“[P]rocedures for the filing and examination of applications for
registration are matters affecting the acquisition of
intellectual property rights in relation to “designations of origin”
and “geographical indications”, as defined in the Regulation.”(58)
…
“Procedures for objections to such applications are related
to the procedures for acquisition, as recognized in the fourth paragraph
of Article 62 (which uses the word “opposition”) and the title of
that article. Hence, opposition procedures are also matters “affecting”
the acquisition of intellectual property rights which concern the “protection”
of intellectual property, as clarified in footnote 3 to the TRIPS
Agreement.”(59)
…
“[I]nspection structures ensure that products meet the
requirements in the specifications. Whatever else may be the legal
character of those structures, it is clear that the specifications
include details of the inspection structures and these must be included
in, or accompany, all applications for registration. The declaration
under Article 12a(2)(b) must also accompany applications to register GIs
located in third countries. Therefore, under this Regulation, the
inspection structures are a matter affecting the availability and
acquisition of protection for GIs.”(60)
…
“[T]he labelling requirement relates to the “use” of an
identical GI on a product. Whatever else may be the legal character of
this requirement, through its inclusion in the provisions of Article
12,
which sets out the conditions on which the Regulation may apply to GIs
located in third countries, it attaches a specific condition to
registration of certain GIs. Therefore, under this Regulation, the
labelling requirement is a matter affecting the acquisition of
protection for GIs.”(61)
(g) Notification requirements
59. At its meeting of 27 February 1997, the TRIPS Council referred to
three options for meeting obligations to notify laws and regulations
that correspond to the obligations of Articles 3,
4 and 5 of the TRIPS
Agreement. It circulated a format as a practical aid in respect of one
of those options.(62)
2. Relationship with other Articles
60. With respect to the relationship with
Article 65.2, see the
excerpt from the panel report referenced in paragraph 291
below.
3. Relationship with other WTO Agreements
61. In US — Section 211 Appropriations Act, the Appellate
Body referred to GATT jurisprudence on Article III:4 of GATT 1994 in
interpreting Article 3 of the TRIPS Agreement for the following reason:
“As we see it, the national treatment obligation is a fundamental
principle underlying the TRIPS Agreement, just as it has been in
what is now the GATT 1994. The Panel was correct in concluding that, as
the language of Article 3.1 of the TRIPS
Agreement, in particular, is
similar to that of Article III:4 of the GATT
1994, the jurisprudence on Article III:4 of the GATT
1994 may be useful in interpreting the
national treatment obligation in the TRIPS Agreement.”(63)
62. The Panel in EC — Trademarks and Geographical Indications
noted the similarity, and the differences, between Article 3 of the
TRIPS Agreement and Article III:4 of GATT
1994:
“It is useful to recall that Article 3.1 of the TRIPS Agreement
combines elements of national treatment both from pre-existing
intellectual property agreements and GATT 1994. Like the pre-existing
intellectual property conventions, Article 3.1 applies to “nationals”,
not products. Like GATT 1994, Article 3.1 refers to “no less
favourable” treatment, not the advantages or rights that laws now
grant or may hereafter grant, but it does not refer to likeness.”(64)
63. The Panel in EC — Trademarks and Geographical Indications
referred to both GATT and WTO jurisprudence on the phrase “no less
favourable” treatment as used in Article III:4 of GATT 1994 in
interpreting Article 3 of the TRIPS Agreement (see
paras. 46, 48 and 50
above) for the following reason:
“The interpretation of the “no less favourable” treatment
standard under other covered agreements may be relevant in interpreting
Article 3.1 of the TRIPS Agreement, taking account of its context in
each agreement including, in particular, any differences arising from
its application to like products or like services and service suppliers,
rather than to nationals.”(65)
64. The Panel in EC — Trademarks and Geographical Indications
explained that Article 3.1 of the TRIPS Agreement and
Article III:4 of
GATT 1994 can co-exist and that neither overrides the other:
“The Panel notes that there is no hierarchy between the TRIPS
Agreement and GATT 1994, which appear in separate annexes to the WTO
Agreement. The ordinary meaning of the texts of the TRIPS Agreement and
GATT 1994, as well as Article II:2 of the WTO
Agreement, taken together,
indicates that obligations under the TRIPS Agreement and GATT 1994 can
co-exist and that one does not override the other. This is analogous to
the finding of the Panel in Canada — Periodicals, with which
the Appellate Body agreed, concerning the respective scopes of GATS and
GATT 1994. Further, a “harmonious interpretation” does not require
an interpretation of one that shadows the contours of the other. It is
well established that the covered agreements apply cumulatively and that
consistency with one does not necessarily imply consistency with them
all.”(66)
V. Article 4
back to top
A. Text of Article 4
Article 4: Most-Favoured-Nation Treatment
With regard to the protection of intellectual property, any
advantage, favour, privilege or immunity granted by a Member to the
nationals of any other country shall be accorded immediately and
unconditionally to the nationals of all other Members. Exempted from
this obligation are any advantage, favour, privilege or immunity
accorded by a Member:
(a) deriving from international agreements on judicial assistance or
law enforcement of a general nature and not particularly confined to the
protection of intellectual property;
(b) granted in accordance with the provisions of the Berne Convention
(1971) or the Rome Convention authorizing that the treatment accorded be
a function not of national treatment but of the treatment accorded in
another country;
(c) in respect of the rights of performers, producers of phonograms
and broadcasting organizations not provided under this Agreement;
(d) deriving from international agreements related to the protection
of intellectual property which entered into force prior to the entry
into force of the WTO Agreement, provided that such agreements are
notified to the Council for TRIPS and do not constitute an arbitrary or
unjustifiable discrimination against nationals of other Members.
B. Interpretation and Application of Article 4
1. General
65. In US — Section 211 Appropriations Act, the Appellate
Body applied analogous reasoning to claims under Articles 3.1 and
4 of
the TRIPS Agreement in respect of the same measure. The measure, on its
face, discriminated as between the nationals of one other Member, and
the nationals of all other countries. The Appellate Body dismissed an
argument that the discrimination could be eliminated through an
administrative procedure:
“Cuban nationals that reside in a country that is part of the ‘authorized
trade territory’, such as the Members States of the European
Communities, can apply to OFAC to be ‘unblocked’. This implies that
Cuban nationals that reside in the ‘authorized trade territory’ face
an additional administrative procedure that does not apply to non-Cuban
foreign nationals who are original owners, because the latter are not
‘designated nationals’. Therefore, as we stated earlier, treatment
that is inherently less favourable persists.”(67)
66. In US — Section 211 Appropriations Act, the Appellate
Body dismissed an argument that certain discriminatory treatment applied
to the nationals of one other Member was offset in practice by another
measure that could provide unfavourable treatment to the nationals of
all other countries:
“The fact that Section 515.201 of Title 31 CFR could also
apply to a non-Cuban foreign national does not mean, however, that it
would offset in each and every case the discriminatory treatment
imposed by Sections 211(a)(2) and (b) on Cuban original owners.”(68)
2. Chapeau
(a) “the protection of intellectual property”
67. In US — Section 211 Appropriations Act,, the Appellate
Body applied to trade names its findings with regard to trademarks in
respect of Article 4 of the TRIPS Agreement.(69)
68. In EC — Trademarks and Geographical Indications (US) the
Panel examined each aspect of the Regulation at issue that was the
subject of an MFN claim in terms of the definition of “protection”
of intellectual property set out in footnote 3 (see
para. 58 above with
respect to the availability and acquisition of intellectual property
rights):
“The MFN treatment obligation in Article 4 of the TRIPS Agreement
applies “with regard to the protection of intellectual property”.
Footnote 3 provides an inclusive definition of the term “protection”
as used in Articles 3 and 4
(…).
The Panel recalls its findings (…) that the conditions of
reciprocity and equivalence in Article 12(1) of the Regulation are
matters affecting the availability of intellectual property rights, in
relation to “designations of origin” and “geographical indications”,
as defined in the Regulation, which are part of a category of
intellectual property within the meaning of Article 1.2 of the TRIPS
Agreement.
Therefore, this claim concerns the “protection” of intellectual
property, as clarified in footnote 3 to the TRIPS
Agreement, within the
scope of the MFN treatment obligation in Article 4 of that
Agreement.”(70)
(b) “any advantage, favour, privilege or immunity granted by a
Member”
69. In EC — Trademarks and Geographical Indications (US) the
Panel found that the availability of GI protection constituted an “advantage,
favour, privilege or immunity granted by a Member”:
“[T]he Panel found that GI protection is not available under the
Regulation in respect of geographical areas located in third countries
which the Commission has not recognized under Article 12(3), although GI
protection under the Regulation may become available if the third
country in which the GI is located enters into an international
agreement or satisfies the conditions in Article 12(1).
This constitutes an “advantage, favour, privilege or immunity”
granted by the European Communities with regard to the protection of
intellectual property.”(71)
(c) “immediately and unconditionally”
70. In EC — Trademarks and Geographical Indications (US) the
Panel found that the EC subjected protection of GIs located in countries
outside the European Communities to the following equivalence and
reciprocity conditions:
- “the third country is able to give guarantees identical or
equivalent to those referred to in Article 4,
- the third country concerned has inspection arrangements and a
right to objection equivalent to those laid down in this Regulation,
- the third country concerned is prepared to provide protection
equivalent to that available in the Community to corresponding
agricultural products or foodstuffs coming from the Community.”(72)
71. In the Panel’s view, this showed that the relevant advantage
was not accorded “immediately and unconditionally”:
“[GI protection under the Regulation] is subject to the
satisfaction of the equivalence and reciprocity conditions, or the
conclusion of an international agreement, or both, which indicates that
it is not accorded “immediately and unconditionally”.(73)
(d) “to the nationals of any other country”
72. In EC — Trademarks and Geographical Indications (US) the
Panel exercised judicial economy on the claims under Article
4, but it
noted that the European Communities had not in fact accorded the
advantage at issue to the nationals of any other country:
“However, [subjecting an advantage to the satisfaction of
conditions] is not sufficient to demonstrate an inconsistency with
Article 4 of the TRIPS Agreement, as it must be shown that the
advantage, favour, privilege or immunity is granted by a Member “to
the nationals of any other country”. It is unnecessary for the
purposes of this claim to re-examine the issue of how the Regulation
discriminates according to nationality, considered in Section VII:B of
this report, because the European Commission has not recognized any
other country as satisfying the conditions under Article 12(1) under the
procedure in Article 12(3).”(74)
3. Article 4(d)
(a) Notification requirements
73. At its meeting of 27 February 1997, the Council for TRIPS
referred to three options for meeting obligations to notify laws and
regulations that correspond to the obligations of Articles
3, 4 and 5 of
the TRIPS Agreement. It circulated a format as a practical aid in
respect of one of those options.(75)
4. Footnote 3
74. In EC — Trademarks and Geographical Indications (US) the
Panel examined each aspect of the Regulation at issue that was the
subject of an MFN claim in terms of the definition of “protection”
of intellectual property set out in footnote 3 (see
paragraph 58 above
with respect to the availability and acquisition of intellectual
property rights).
VI. Article 5
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A. Text of Article 5
Article 5: Multilateral Agreements on Acquisition or Maintenance of
Protection
The obligations under Articles 3 and
4 do not apply to procedures
provided in multilateral agreements concluded under the auspices of WIPO
relating to the acquisition or maintenance of intellectual property
rights.
B. Interpretation and Application of Article 5
1. Notification
75. With respect to notifications of laws and regulations relating to
Articles 3, 4 and 5 of the TRIPS
Agreement, see paragraph 59 above.
VII. Article 6
back to top
A. Text of Article 6
Article 6: Exhaustion
For the purposes of dispute settlement under this Agreement, subject
to the provisions of Articles 3 and 4 nothing in this Agreement shall be
used to address the issue of the exhaustion of intellectual property
rights.
B. Interpretation and Application of Article 6
76. With respect to the exhaustion of intellectual property rights,
paragraph 5(d) of the Declaration on the TRIPS Agreement and Public
Health, adopted on 14 November 2001, reads as follows:
“The effect of the provisions in the TRIPS Agreement that are
relevant to the exhaustion of intellectual property rights is to leave
each Member free to establish its own regime for such exhaustion without
challenge, subject to the MFN and national treatment provisions of
Articles 3 and 4.”(76)
VIII. Article 7
back to top
A. Text of Article 7
Article 7: Objectives
The protection and enforcement of intellectual property rights should
contribute to the promotion of technological innovation and to the
transfer and dissemination of technology, to the mutual advantage of
producers and users of technological knowledge and in a manner conducive
to social and economic welfare, and to a balance of rights and
obligations.
B. Interpretation and Application of Article 7
1. Relationship with other Articles
77. The Panel in US — Section 211 Appropriations Act offered
the following observations on Article 7:
“Article 7 of the TRIPS Agreement states that one of the objectives
is that “[t]he protection and enforcement of intellectual property
rights should contribute… to a balance of rights and obligations.”
We consider this expression to be a form of the good faith principle.
The Appellate Body in United States — Shrimps stated that this
principle “controls the exercise of rights by states. One application
of this principle, the application widely known as the doctrine of abus
de droit, prohibits the abusive exercise of a state’s rights and
enjoins that whenever the assertion of a right ‘impinges on the field
covered by [a] treaty obligation, it must be exercised bona fide, that
is to say reasonably.’ An abusive exercise by a Member of its own
treaty right thus results in a breach of the treaty rights of the other
members and, as well, a violation of the treaty obligation of the Member
so acting.”(77) Members must therefore implement the provisions of the
TRIPS Agreement in a manner consistent with the good faith principle
enshrined in Article 7 of the TRIPS Agreement.”(78)
78. With respect to the relationship with
Article 30, see the excerpt
from the panel report referenced in paragraph 191 below.
79. With respect to the objectives and principles of the TRIPS
Agreement, paragraph 5(a) of the Declaration on the TRIPS Agreement and
Public Health, adopted on 14 November 2001, reads as follows:
“In applying the customary rules of interpretation of public
international law, each provision of the TRIPS Agreement shall be read
in the light of the object and purpose of the Agreement as expressed, in
particular, in its objectives and principles.”(79)
80. Paragraph 19 of the Doha Ministerial
Declaration, adopted on 14
November 2001, provides that, “[i]n undertaking [the work referred to
in that paragraph], the TRIPS Council shall be guided by the objectives
and principles set out in Articles 7 and 8 of the TRIPS
Agreement.”(80)
IX. Article 8
back to top
A. Text of Article 8
Article 8: Principles
1.
Members may, in formulating or amending their laws and
regulations, adopt measures necessary to protect public health and
nutrition, and to promote the public interest in sectors of vital
importance to their socio-economic and technological development,
provided that such measures are consistent with the provisions of this
Agreement.
2. Appropriate measures, provided that they are consistent with the
provisions of this Agreement, may be needed to prevent the abuse of
intellectual property rights by right holders or the resort to practices
which unreasonably restrain trade or adversely affect the international
transfer of technology.
B. Interpretation and Application of Article 8
1. Article 8.1
81. In EC — Trademarks and Geographical Indications, in the
course of explaining why the TRIPS Agreement did not contain a general
exceptions provision, the Panel referred to the principles of the
Agreement set out in Article 8.1:
“These principles reflect the fact that the TRIPS Agreement does
not generally provide for the grant of positive rights to exploit or use
certain subject matter, but rather provides for the grant of negative
rights to prevent certain acts. This fundamental feature of intellectual
property protection inherently grants Members freedom to pursue
legitimate public policy objectives since many measures to attain those
public policy objectives lie outside the scope of intellectual property
rights and do not require an exception under the TRIPS Agreement.”(81)
2. Relationship with other Articles
82. With respect to the relationship with
Article 30, see paragraph
191 below.
83. With respect to the objectives and principles of the TRIPS
Agreement, paragraph 5(a) of the Declaration on the TRIPS Agreement and
Public Health, adopted on 14 November 2001, reads as follows:
“In applying the customary rules of interpretation of public
international law, each provision of the TRIPS Agreement shall be read
in the light of the object and purpose of the Agreement as expressed, in
particular, in its objectives and principles.”(82)
84. Paragraph 19 of the Doha Ministerial
Declaration, adopted on 14
November 2001, provides that, “[i]n undertaking [the work referred to
in that paragraph], the TRIPS Council shall be guided by the objectives
and principles set out in Articles 7 and 8 of the TRIPS Agreement”.(83)
X. Article 9 and Incorporated Provisions of the Berne Convention
(1971) back to top
A. Text of Article 9
Article 9: Relation to the Berne Convention
1.
Members shall comply with Articles 1 through
21 of the Berne
Convention (1971) and the Appendix thereto. However, Members shall not
have rights or obligations under this Agreement in respect of the rights
conferred under Article 6bis of that Convention or of the rights derived
therefrom.
2.
Copyright protection shall extend to expressions and not to ideas,
procedures, methods of operation or mathematical concepts as such.
The text of Articles 1–21 of the Berne Convention and Appendix,
other than Article 6bis appears in Section LXXVI
below.
B. Interpretation and Application of Article 9 and Incorporated Provisions of the Berne Convention (1971)
1. Relationship with the Berne Convention (1971)
85. In US — Section 110(5) Copyright Act, in examining the
consistency of certain provisions of the US Copyright Act with the TRIPS
Agreement, the Panel made a finding on the relationship between the
TRIPS Agreement and the Berne Convention (1971):
“Articles 9–13 of Section 1 of Part II of the TRIPS Agreement
entitled ‘Copyright and Related Rights’ deal with the substantive
standards of copyright protection. Article 9.1 of the TRIPS Agreement
obliges WTO Members to comply with Articles 1–21 of the Berne
Convention (1971) (with the exception of Article 6bis on moral
rights and the rights derived therefrom) and the Appendix thereto… .
We note that through their incorporation, the substantive rules of
the Berne Convention (1971), including the provisions of its Articles 11bis(1)(iii)
and 11(1)(ii), have become part of the TRIPS Agreement and as provisions
of that Agreement have to be read as applying to WTO Members.”(84)
86. The Panel also considered a provision of the Vienna Convention on
the Law of the Treaties with respect to the TRIPS Agreement and the
Berne Convention (1971).
“We note that Article 30 of the Vienna Convention on the
application of successive treaties is not relevant in this respect,
because all provisions of the TRIPS Agreement — including the
incorporated Articles 1–21 of the Berne Convention (1971) — entered
into force at the same point in time.”(85)
87. With respect to the relationship of the minor exceptions doctrine
under the Berne Convention (1971) and the TRIPS Agreement, see also the
excerpt from the panel report referenced in paragraph 101
below.
88. In US — Section 110(5) Copyright Act, the Panel
emphasized the need, in the light of general principles of
interpretation, to harmoniously interpret provisions of the TRIPS
Agreement and the Berne Convention (1971):
“In the area of copyright, the Berne Convention and the TRIPS
Agreement form the overall framework for multilateral protection. Most
WTO Members are also parties to the Berne Convention. We recall that it
is a general principle of interpretation to adopt the meaning that
reconciles the texts of different treaties and avoids a conflict between
them. Accordingly, one should avoid interpreting the TRIPS Agreement to
mean something different than the Berne Convention except where this is
explicitly provided for. This principle is in conformity with the public
international law presumption against conflicts, which has been applied
by WTO panels and the Appellate Body in a number of cases. We believe
that our interpretation of the legal status of the minor exceptions
doctrine under the TRIPS Agreement is consistent with these general
principles.”(86)
89. The Panel adopted the same approach to the interpretation of the
TRIPS Agreement and the WIPO Copyright Treaty (“WCT”) as it had
applied with respect to the TRIPS Agreement and the Berne Convention
(1971) the Panel stated as follows:
“In paragraph 6.66 we discussed the need to interpret the Berne
Convention and the TRIPS Agreement in a way that reconciles the texts of
these two treaties and avoids a conflict between them, given that they
form the overall framework for multilateral copyright protection. The
same principle should also apply to the relationship between the TRIPS
Agreement and the WCT. The WCT is designed to be compatible with this
framework, incorporating or using much of the language of the Berne
Convention and the TRIPS Agreement. The WCT was unanimously concluded at
a diplomatic conference organized under the auspices of WIPO in December
1996, one year after the WTO Agreement entered into force, in which 127
countries participated. Most of these countries were also participants
in the TRIPS negotiations and are Members of the WTO. For these reasons,
it is relevant to seek contextual guidance also in the WCT when
developing interpretations that avoid conflicts within this overall
framework, except where these treaties explicitly contain different
obligations.”(87)
2. Article 5(1) of the Berne Convention (1971) as incorporated in the
TRIPS Agreement
(a) Scope of Article 5(1)
90. In China — Intellectual Property Rights, the Panel was
called upon to interpret Article 5(1) of the Berne Convention
(1971).
The Panel considered the scope of Article 5(1) as follows:
“Article 5(1) of the Berne Convention (1971) provides for the
enjoyment of two overlapping sets of rights that have been described as
“the twin pillars on which protection under the Convention rests”.
First, there are “the rights which their respective laws do now or may
hereafter grant to their nationals”.(88) This is a national treatment
obligation… .
Second, there are “the rights specially granted by this Convention”.
This term is not defined. However, Article 5(1) refers to rights that
authors shall enjoy in respect of works. Articles 6bis,
8, 9,
11,
11bis, 11ter,
12, 14,
14bis and 14ter all
provide for such rights.(89) Nevertheless, the incorporation of provisions
of the Berne Convention (1971), including Article 5, is subject to the
terms of Article 9.1 of the TRIPS Agreement …. Therefore, “the
rights specially granted by this Convention” as used in Article 5(1)
of that Convention, as incorporated by Article 9.1 of the TRIPS
Agreement, do not include the rights referred to in Article
6bis of the
Berne Convention (1971). This Report refers to these rights in that
sense.”(90)
91. The Panel in China — Intellectual Property Rights
further elaborated on the categories of “works” the two sets or
rights under Article 5(1) of the Berne Convention relate to:
“The categories of “works” in respect of which authors shall
enjoy the rights specially granted by the Convention vary according to
the terms of each Article granting the relevant right. For example, the
rights of reproduction (Article 9) and of broadcasting
(Article 11bis)
are granted to authors of “literary and artistic works”. That
expression is defined, in a non-exhaustive manner, in Article 2(1) of
the Berne Convention (1971).”(91)
3. Article 11 of the Berne Convention (1971) as incorporated in the
TRIPS Agreement
(a) Scope of Article 11
92. In US — Section 110(5) Copyright Act, the Panel was
called upon to interpret Article 11 of the Berne Convention
(1971). The
Panel considered the scope of Article 11 as follows:
“As in the case of Article 11bis(1) of the Berne Convention
(1971), which concerns broadcasting to the public and communication of a
broadcast to the public, the exclusive rights conferred by Article 11
cover public performance; private performance does not require
authorization. Public performance includes performance by any means or
process, such as performance by means of recordings (e.g., CDs,
cassettes and videos).(92) It also includes communication to the public of
a performance of the work.”(93)
(b) Paragraph 1
93. In US — Section 110(5) Copyright Act, the Panel agreed
with the parties that a particular type of communication was covered by
the exclusive rights set forth in Article 11(1) of the Berne Convention
(1971):
“We share the understanding of the parties that a communication to
the public by loudspeaker of a performance of a work transmitted by
means other than hertzian waves is covered by the exclusive rights
conferred by Article 11(1) of the Berne Convention
(1971).”(94)
94. In US — Section 110(5) Copyright Act (Article 25.3), the
Arbitrators emphasized the difference between Members’ respective
obligations under Article 11(1)(ii) of the Berne Convention (1971) and
right holders’ exercise or exploitation of rights:
“For purposes of the present dispute, this means that the United
States is under an obligation to make available to EC right holders the
exclusive rights set forth in Articles 11bis(1)(iii) and
11(1)(ii).(95) It is important to bear in mind, however, that, while it is
for the United States to provide EC right holders with the
exclusive rights set forth in Articles 11bis(1)(iii) and
11(1)(ii), it is for EC right holders to determine whether and
how to exercise or exploit those rights.”(96)
(c) Relationship between Article 11 of the Berne Convention (1971)
and other Articles of this Convention.
95. In US — Section 110(5) Copyright Act, the Panel found
Article 11 to be a general rule concerning the communication of
performances of works, while Article 11bis provided a specific
rule concerning a particular type of communication:
“Regarding the relationship between Articles 11 and 11bis,
we note that the rights conferred in Article 11(1) (ii) concern the
communication to the public of performances of works in general. Article
11bis(1)(iii) is a specific rule conferring exclusive rights
concerning the public communication by loudspeaker or any other
analogous instrument transmitting, by signs, sounds or images, the
broadcast of a work.”(97)
4. Article 11 bis of the Berne Convention (1971) as
incorporated in the TRIPS Agreement
(a) Paragraph 1
96. In US — Section 110(5) Copyright Act, in interpreting
Article 11bis(1), the Panel addressed the three “separate
exclusive” rights provided by Article 11bis(1) subparagraph (i)
through (iii):
“In the light of Article 2 of the Berne Convention
(1971), ‘artistic’
works in the meaning of Article 11bis(1) include non-dramatic and
other musical works. Each of the subparagraphs of Article 11bis(1)
confers a separate exclusive right; exploitation of a work in a manner
covered by any of these subparagraphs requires an authorization by the
right holder. For example, the communication to the public of a
broadcast creates an additional audience and the right holder is given
control over, and may expect remuneration from, this new public
performance of his or her work.
The right provided under subparagraph (i) of Article 11bis(1)
is to authorize the broadcasting of a work and the communication thereof
to the public by any other means of wireless diffusion of signs, sounds
or images. It applies to both radio and television broadcasts. Subparagraph
(ii) concerns the subsequent use of this emission; the
authors’ exclusive right covers any communication to the public by
wire or by rebroadcasting of the broadcast of the work, when the
communication is made by an organization other than the original one.
Subparagraph (iii) provides an exclusive right to authorize the
public communication of the broadcast of the work by loudspeaker, on a
television screen, or by other similar means. Such communication
involves a new public performance of a work contained in a broadcast,
which requires a licence from the right holder.”(98)
97. In US — Section 110(5) Copyright Act (Article 25.3), the
Arbitrators emphasized the difference between Members’ respective
obligations under Article 11bis(1) (iii) of the Berne Convention
(1971) and right holders’ exercise or exploitation of rights as
follows:
“For purposes of the present dispute, this means that the United
States is under an obligation to make available to EC right holders the
exclusive rights set forth in Articles 11bis(1)(iii) and
11(1)(ii).(99) It is important to bear in mind, however, that, while it is
for the United States to provide EC right holders with the
exclusive rights set forth in Articles 11bis(1)(iii) and
11(1)(ii), it is for EC right holders to determine whether and
how to exercise or exploit those rights.”(100)
(b) Paragraph 2
98. In US — Section 110(5) Copyright Act, the Panel
addressed the authorization, provided by Article 11bis(2), to
substitute a compulsory licence for an exclusive right under Article 11bis
(1):
“We also conclude that Article 11bis(2) of the Berne
Convention (1971) as incorporated into the TRIPS Agreement allows
Members to substitute a compulsory licence for an exclusive right under
Article 11bis(1), or determine other conditions provided that
they are not prejudicial to the right holder’s right to obtain an
equitable remuneration. Article 11bis(2) is not relevant for the
case at hand, because the United States has not provided a right in
respect of the uses covered by the present Section 110(5), the exercise
of which would have been subjected to conditions determined in its
legislation.”(101)
(c) Relationship between Article 11bis of the Berne Convention
(1971) and other Articles of the Convention
99. With respect to the relationship between
Articles 11 and 11bis
of the Berne Convention (1971) as incorporated in the TRIPS Agreement,
see paragraph 95 above.
(d) Minor exceptions doctrine
100. In US — Section 110(5) Copyright Act, the Panel
addressed the question whether the “minor exceptions doctrine” in
the context of copyrights applied under the TRIPS Agreement. The Panel
decided first to examine to what extent this doctrine formed part of the
Berne Convention (1971) acquis and second, to assess whether that
doctrine had been incorporated into the TRIPS Agreement. With respect to
the scope of the minor exceptions doctrine under the Berne Convention
(1971), the Panel held:
“The General Report of the Brussels Conference of 1948 refers to
‘religious ceremonies, military bands and the needs of the child and
adult education’ as examples of situations in respect of which minor
exceptions may be provided. The Main Committee I Report of the Stockholm
Conference of 1967 refers also to ‘popularization’ as one example.
When these references are read in their proper context, it is evident
that the given examples are of an illustrative character… .
… On the basis of the information provided to us, we are not in a
position to determine that the minor exceptions doctrine justifies only
exclusively non-commercial use of works and that it may under no
circumstances justify exceptions to uses with a more than negligible
economic impact on copyright holders. On the other hand, noncommercial
uses of works, e.g., in adult and child education, may reach a level
that has a major economic impact on the right holder. At any rate, in
our view, a noncommercial character of the use in question is not
determinative provided that the exception contained in national law is
indeed minor… .”(102)
101. As the second step in its “minor exceptions analysis”, the
Panel examined to what extent this doctrine under the Berne Convention
(1971) had been incorporated into the TRIPS Agreement
“Having concluded that the minor exceptions doctrine forms part of
the ‘context’ of, at least, Articles 11bis and
11 of the
Berne Convention (1971) by virtue of an agreement within the meaning of
Article 31(2)(a) of the Vienna Convention, which was made between the
Berne Union members in connection with the conclusion of the respective
amendments to that Convention, we next address the second step of our
analysis …
…
… we conclude that, in the absence of any express exclusion in
Article 9.1 of the TRIPS Agreement, the incorporation of Articles
11 and 11bis of the Berne Convention (1971) into the Agreement
includes the entire acquis of these provisions, including the
possibility of providing minor exceptions to the respective exclusive
rights.”(103)
(e) Relationship between Article 11bis(2) of the Berne
Convention (1971) and Article 13 of the TRIPS Agreement
102. With respect to the relationship between
Article 11bis(2)
of the Berne Convention (1971) and Article 13 of the TRIPS
Agreement,
see paragraphs 110–112 below.
5. Article 17 of the Berne Convention (1971) as incorporated in the
TRIPS Agreement
(a) Scope of Article 17
103. In China — Intellectual Property Rights,
Article 17 of
the Berne Convention (1971) was invoked as a defence to a claim of a
violation of Article 5(1) of the Berne Convention
(1971). Article 17
provides that the provisions of the Berne Convention cannot affect the
rights of its members “to permit, to control, or to prohibit, by
legislation or regulation, the circulation, presentation, or exhibition
of any work or production in regard to which the competent authority may
find it necessary to exercise that right.” With respect to the scope
of Article 17, the Panel in China — Intellectual Property Rights
concluded as follows:
“The right of a government “to control, or to prohibit” the “circulation,
presentation, or exhibition” of any work or production clearly
includes censorship for reasons of public order.(104)
… The Panel
accepts that the three terms “circulation, presentation, or exhibition”
are not necessarily an exhaustive list of the forms of exploitation of
works covered by Article 17. However, a noticeable feature of these
three terms is that they do not correspond to the terms used to define
the substantive rights granted by the Berne Convention (1971), although
they may be included within some of those rights(105) or they may refer to
acts incidental to the exercise of some of those rights.(106) The word ‘exhibition’
is not even used in the provisions setting out the substantive rights
granted by the Convention.(107) Therefore, it cannot be inferred that
Article 17 authorizes the denial of all copyright protection in any
work.”(108)
104. The Panel in China — Intellectual Property Rights,
further elaborated on the scope of Article 17 as follows:
“A government’s right to permit, to control, or to prohibit the
circulation, presentation, or exhibition of a work may interfere with
the exercise of certain rights with respect to a protected work by the
copyright owner or a third party authorized by the copyright owner.
However, there is no reason to suppose that censorship will eliminate
those rights entirely with respect to a particular work.
With respect to those rights that are granted by the Berne Convention
(1971), China is unable to explain why Article 4(1) of its Copyright Law
provides for the complete denial of their protection with respect to
particular works. Without prejudice to the range of rights that are
granted by the Berne Convention (1971), it suffices to note that they
are mostly exclusive rights of authorizing certain acts with respect to
protected works. An exclusive right of authorizing necessarily entails
the right to prevent others from carrying out the relevant acts with
respect to protected works. China is unable to explain why censorship
interferes with copyright owners’ rights to prevent third parties from
exploiting prohibited works.
…
The Panel notes that copyright and government censorship address
different rights and interests. Copyright protects private rights, as
reflected in the fourth recital of the preamble to the TRIPS Agreement,
whilst government censorship addresses public interests.”(109)
6. Article 20 of the Berne Convention (1971) as incorporated in the
TRIPS Agreement
105. In US — Section 110(5) Copyright Act, the Panel
declined to address Article 20 of the Berne Convention
(1971), because
— contrary to the European Communities’ argument — the United
States was not claiming that the TRIPS Agreement authorizes exceptions
inconsistent with the Berne Convention (1971):
“In regard to the argument of the European Communities that the US
interpretation of Article 13 is incompatible with
Article 20 of the
Berne Convention (1971) and Article 2.2 of the TRIPS Agreement because
it treats Article 13 of the TRIPS Agreement as providing a basis for
exceptions that would be inconsistent with those permitted under the
Berne Convention (1971), we note that the United States is not arguing
this but rather that Article 13 clarifies and articulates the standards
applicable to minor exceptions under the Berne Convention (1971). Since
the EC arguments in relation to these provisions would only be relevant
if a finding that would involve inconsistency with the Berne Convention
(1971) were being advocated, we do not feel it is necessary to examine
them further.”(110)
7. Appendix to the Berne Convention (1971) as incorporated in the
TRIPS Agreement
106. At its meeting of 16 July 1998, the Council for TRIPS took note
of the following statement by its Chairperson, in the light of informal
consultations on the calculation of renewable periods of ten years under
Article I(2) of the Appendix to the Berne Convention (1971):
“The provisions of Article I(2) of the Appendix as incorporated
into the TRIPS Agreement can be understood so that, for the purposes of
the TRIPS Agreement, the relevant periods are calculated by reference to
the same date, i.e. 10 October 1974, as for the purposes of the Berne
Convention. This would mean that renewable periods of ten years would be
the same for the purposes of both Agreements, and that, also under the
TRIPS Agreement, the period of ten years currently running would expire
on 10 October 2004.”(111)
XI. Article 10
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A. Text of Article 10
Article 10: Computer Programs and Compilations of Data
1. Computer programs, whether in source or object code, shall be
protected as literary works under the Berne Convention (1971).
2. Compilations of data or other material, whether in machine
readable or other form, which by reason of the selection or arrangement
of their contents constitute intellectual creations shall be protected
as such. Such protection, which shall not extend to the data or material
itself, shall be without prejudice to any copyright subsisting in the
data or material itself.
B. Interpretation and Application of Article 10
No jurisprudence or decision of a competent WTO body.
XII. Article 11
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A. Text of Article 11
Article 11: Rental Rights
In respect of at least computer programs and cinematographic works, a
Member shall provide authors and their successors in title the right to
authorize or to prohibit the commercial rental to the public of
originals or copies of their copyright works. A Member shall be excepted
from this obligation in respect of cinematographic works unless such
rental has led to widespread copying of such works which is materially
impairing the exclusive right of reproduction conferred in that Member
on authors and their successors in title. In respect of computer
programs, this obligation does not apply to rentals where the program
itself is not the essential object of the rental.
B. Interpretation and Application of Article 11
No jurisprudence or decision of a competent WTO body.
XIII. Article 12
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A. Text of Article 12
Article 12: Term of Protection
Whenever the term of protection of a work, other than a photographic
work or a work of applied art, is calculated on a basis other than the
life of a natural person, such term shall be no less than 50 years from
the end of the calendar year of authorized publication, or, failing such
authorized publication within 50 years from the making of the work, 50
years from the end of the calendar year of making.
B. Interpretation and Application of
Article 12
No jurisprudence or decision of a competent WTO body.
XIV. Article 13
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A. Text of Article 13
Article
13: Limitations and Exceptions
Members shall confine limitations or exceptions to exclusive rights
to certain special cases which do not conflict with a normal
exploitation of the work and do not unreasonably prejudice the
legitimate interests of the right holder.
B. Interpretation and Application of Article 13
1. General
(a) Scope
107. In US — Section 110(5) Copyright Act, the Panel
rejected a suggested limitation of the scope of Article
13:
“In our view, neither the express wording nor the context of
Article 13 or any other provision of the TRIPS Agreement supports the
interpretation that the scope of application of Article 13 is limited to
the exclusive rights newly introduced under the TRIPS Agreement.”(112)
108. With respect to the scope of
Article 13, see paragraph 110
below.
109. In interpreting
Article 13, the Panel in US — Section
110(5) Copyright Act outlined its interpretative approach to this
provision, specified the conditions for limitations or exceptions to
exclusive rights and found that these conditions apply cumulatively:
“Article 13 of the TRIPS Agreement requires that limitations and
exceptions to exclusive rights (1) be confined to certain special cases,
(2) do not conflict with a normal exploitation of the work, and (3) do
not unreasonably prejudice the legitimate interests of the right holder.
The principle of effective treaty interpretation requires us to give a
distinct meaning to each of the three conditions and to avoid a reading
that could reduce any of the conditions to ‘redundancy or inutility’.
The three conditions apply on a cumulative basis, each being a separate
and independent requirement that must be satisfied. Failure to comply
with any one of the three conditions results in the Article 13 exception
being disallowed. Both parties agree on the cumulative nature of the
three conditions. The Panel shares their view. It may be noted at the
outset that Article 13 cannot have more than a narrow or limited
operation. Its tenor, consistent as it is with the provisions of Article
9(2) of the Berne Convention (1971), discloses that it was not intended
to provide for exceptions or limitations except for those of a limited
nature. The narrow sphere of its operation will emerge from our
discussion and application of its provisions in the paragraphs which
follow.”(113)
(b) Relationship with other Articles
110. In US — Section 110(5) Copyright Act, the Panel made a
finding on the scope of application of Article 13 with respect to
individual subparagraphs of Articles 11 and
11bis of the Berne
Convention (1971):
“We conclude that Article 13 of the TRIPS Agreement applies to
Articles 11bis(1)(iii) and 11(1)(ii) of the Berne Convention
(1971) as incorporated into the TRIPS Agreement, given that neither the
express wording nor the context of Article 13 or any other provision of
the TRIPS Agreement supports the interpretation that the scope of
application of Article 13 is limited to the exclusive rights newly
introduced under the TRIPS Agreement.”(114)
111. The Panel also clearly distinguished the different situations
covered by Article 11bis(2) of the Berne Convention (1971) and
Article 13 of the TRIPS Agreement, respectively:
“We believe that Article 11bis(2) of the Berne Convention
(1971) and Article 13 cover different situations. On the one hand,
Article 11bis(2) authorizes Members to determine conditions under
which the rights conferred by Article 11bis(1)(i-iii) may be
exercised. The imposition of such conditions may completely replace the
free exercise of the exclusive right of authorizing the use of the
rights embodied in subparagraphs
(i-iii) provided that equitable
remuneration and the author’s moral rights are not prejudiced.
However, unlike Article 13 of the TRIPS Agreement,
Article 11bis(2)
of the Berne Convention (1971) would not in any case justify use free of
charge.
On the other hand, it is sufficient that a limitation or an exception
to the exclusive rights provided under Article 11bis(1) of the
Berne Convention (1971) as incorporated into the TRIPS Agreement meets
the three conditions contained in its Article 13 to be permissible. If
these three conditions are met, a government may choose between
different options for limiting the right in question, including use free
of charge and without an authorization by the right holder. This is not
in conflict with any of the paragraphs of Article 11bis because
use free of any charge may be permitted for minor exceptions by virtue
of the minor exceptions doctrine which applies, inter alia, also
to Article 11bis.
As regards situations that would not meet the above-mentioned three
conditions, a government may not justify an exception, including one
involving use free of charge, by Article 13 of the TRIPS
Agreement.
However, also in these situations Article 11bis(2) of the Berne
Convention (1971) as incorporated into the TRIPS Agreement would
nonetheless allow Members to substitute, for an exclusive right, a
compulsory licence, or determine other conditions provided that they
were not prejudicial to the right holder’s right to obtain an
equitable remuneration.”(115)
112. In the same context, the Panel considered that a reading of
Articles 11bis(2) of the Berne Convention (1971) and Article 13
of the TRIPS Agreement which did not differentiate the situations
covered respectively by these provisions, would render Article 13 “somewhat
redundant”:
“We believe that our interpretation gives meaning and effect to
Article 11bis(2), the minor exceptions doctrine as it applies to
Article 11bis, and Article 13. However, in our view, under the
interpretation suggested by the European Communities this would not be
the case, e.g., in the following situations. If any de minimis
exception from rights conferred by Article 11bis(1)(i-iii) were
subject to the requirement to provide equitable remuneration within the
meaning of Article 11bis(2), no exemption whatsoever from the
rights recognized by Article 11bis(1) could permit use free of
charge even if the three criteria of Article 13 were met. As a result,
narrow exceptions or limitations would be subject to the three
conditions of Article 13 in addition to the requirement to provide
equitable remuneration. At the same time, broader exceptions or
limitations which do not comply with the criteria of Article 13 could
arguably still be justified under Article 11bis(2) as long as the
conditions imposed ensure, inter alia, equitable remuneration.
Such an interpretation could render Article 13 somewhat redundant
because narrow exceptions would be subject to all the requirements of
Article 13 and Article 11bis(2) on a cumulative basis, while for
broader exceptions compliance with Article 11bis(2) could
suffice. Both situations would lead to the result that any use free of
charge would not be permissible. These examples are illustrative of
situations where the terms and conditions of Article
13, Article 11bis(2)
and the minor exceptions doctrine would not be given full meaning and
effect.”(116)
113. With respect to the relationship of
Article 13 to Article 9(2)
of the Berne Convention (1971) and Articles 17,
26.2 and 30 of the TRIPS
Agreement, see footnote 207.
(c) “certain special cases”
114. In US — Section 110(5) Copyright Act, the Panel
interpreted the meaning of the phrase “certain special cases”, the
first condition in Article 13: In our view, the first condition of
Article 13 requires that a limitation or exception in national
legislation should be clearly defined and should be narrow in its scope
and reach. On the other hand, a limitation or exception may be
compatible with the first condition even if it pursues a special purpose
whose underlying legitimacy in a normative sense cannot be discerned.
The wording of Article 13’s first condition does not imply passing a
judgment on the legitimacy of the exceptions in dispute. However, public
policy purposes stated by law-makers when enacting a limitation or
exception may be useful from a factual perspective for making inferences
about the scope of a limitation or exception or the clarity of its
definition.”(117)
115. The Panel also addressed the relevance of whether the measure at
issue had as its declared aim a legitimate public policy:
“As regards the parties’ arguments on whether the public policy
purpose of an exception is relevant, we believe that the term ‘certain
special cases’ should not lightly be equated with ‘special purpose’.(118)
It is difficult to reconcile the wording of Article 13 with the
proposition that an exception or limitation must be justified in terms
of a legitimate public policy purpose in order to fulfill the first
condition of the Article. We also recall in this respect that in
interpreting other WTO rules, such as the national treatment clauses of
the GATT and the GATS, the Appellate Body has rejected interpretative
tests which were based on the subjective aim or objective pursued by
national legislation.”(119),(120)
116. The Panel subsequently applied the above quoted standard under
Article 13 to examine whether the United States’ measure at issue in US
— Section 110(5) Copyright Act met the first condition of “certain
special cases”:
“[W]e first examine whether the exceptions have been clearly
defined. Second, we ascertain whether the exemptions are narrow in
scope, inter alia, with respect to their reach. In that respect,
we take into account what percentage of eating and drinking
establishments and retail establishments may benefit from the business
exemption under subparagraph (B), and in turn what percentage of
establishments may take advantage of the homestyle exemption under
subparagraph (A). On a subsidiary basis, we consider whether it is
possible to draw inferences about the reach of the business and
homestyle exemptions from the stated policy purposes underlying these
exemptions according to the statements made during the US legislative
process.”(121)
(d) “do not conflict with a normal exploitation of the work”
117. In US — Section 110(5) Copyright Act, in examining the
second condition under Article 13, i.e. “do not conflict with a normal
exploitation of the work”, the Panel first sought a definition for the
term “exploitation” :
“The ordinary meaning of the term ‘exploit’ connotes ‘making
use of’ or ‘utilising for one’s own ends’. We believe that ‘exploitation’
of musical works thus refers to the activity by which copyright owners
employ the exclusive rights conferred on them to extract economic value
from their rights to those works.”(122)
118. The Panel then proceeded to provide an interpretation of the
term “normal”:
“We note that the ordinary meaning of the term ‘normal’ can be
defined as ‘constituting or conforming to a type or standard; regular,
usual, typical, ordinary, conventional …’. In our opinion, these
definitions appear to reflect two connotations: the first one appears to
be of an empirical nature, i.e., what is regular, usual, typical or
ordinary. The other one reflects a somewhat more normative, if not
dynamic, approach, i.e., conforming to a type or standard. We do not
feel compelled to pass a judgment on which one of these connotations
could be more relevant. Based on Article 31 of the Vienna Convention, we
will attempt to develop a harmonious interpretation which gives meaning
and effect to both connotations of ‘normal’.
If ‘normal’ exploitation were equated with full use of all
exclusive rights conferred by copyrights, the exception clause of
Article 13 would be left devoid of meaning. Therefore, ‘normal’
exploitation clearly means something less than full use of an exclusive
right.”(123),(124)
119. The Panel then endorsed a differentiated examination of whether
a limitation or an exception conflicts with the normal exploitation of a
work:
“We agree with the European Communities that whether a limitation
or an exception conflicts with a normal exploitation of a work should be
judged for each exclusive right individually.”(125)
120. The Panel also indicated that when assessing the meaning of “normal
exploitation”, it would consider both empirical and normative
criteria:
“In our view, this test [whether there are areas of the market in
which the copyright owner would ordinarily expect to exploit the work,
but which are not available for exploitation because of this exemption]
seems to reflect the empirical or quantitative aspect of the connotation
of ‘normal’, the meaning of ‘regular, usual, typical or ordinary’.
We can, therefore, accept this US approach, but only for the empirical
or quantitative side of the connotation. We have to give meaning and
effect also to the second aspect of the connotation, the meaning of ‘conforming
to a type or standard’. We described this aspect of normalcy as
reflecting a more normative approach to defining normal exploitation,
that includes, inter alia, a dynamic element capable of taking
into account technological and market developments. The question then
arises how this normative aspect of ‘normal’ exploitation could be
given meaning in relation to the exploitation of musical works.
…
Thus it appears that one way of measuring the normative connotation
of normal exploitation is to consider, in addition to those forms of
exploitation that currently generate significant or tangible revenue,
those forms of exploitation which, with a certain degree of likelihood
and plausibility, could acquire considerable economic or practical
importance.”(126)
121. After exploring the two different connotations of the term “normal
exploitation”, the Panel then set forth a test for “normal
exploitation” based on the consideration of “economic competition”
and “market conditions”:
“We believe that an exception or limitation to an exclusive right
in domestic legislation rises to the level of a conflict with a normal
exploitation of the work (i.e., the copyright or rather the whole bundle
of exclusive rights conferred by the ownership of the copyright), if
uses, that in principle are covered by that right but exempted under the
exception or limitation, enter into economic competition with the ways
that right holders normally extract economic value from that right to
the work (i.e., the copyright) and thereby deprive them of significant
or tangible commercial gains.
In developing a benchmark for defining the normative connotation of
normal exploitation, we recall the European Communities’ emphasis on
the potential impact of an exception rather than on its actual effect on
the market at a given point in time, given that, in its view, it is the
potential effect that determines the market conditions.
…
We base our appraisal of the actual and potential effects on the
commercial and technological conditions that prevail in the market
currently or in the near future. What is a normal exploitation in the
market-place may evolve as a result of technological developments or
changing consumer preferences. Thus, while we do not wish to speculate
on future developments, we need to consider the actual and potential
effects of the exemptions in question in the current market and
technological environment.
We do acknowledge that the extent of exercise or non-exercise of
exclusive rights by right holders at a given point in time is of great
relevance for assessing what is the normal exploitation with respect to
a particular exclusive right in a particular market. However, in certain
circumstances, current licensing practices may not provide a sufficient
guideline for assessing the potential impact of an exception or
limitation on normal exploitation. For example, where a particular use
of works is not covered by the exclusive rights conferred in the law of
a jurisdiction, the fact that the right holders do not license such use
in that jurisdiction cannot be considered indicative of what constitutes
normal exploitation. The same would be true in a situation where, due to
lack of effective or affordable means of enforcement, right holders may
not find it worthwhile or practical to exercise their rights.”(127)
(e) “do not unreasonably prejudice the legitimate interests of the
right holder”
122. In US — Section 110(5) Copyright Act, in examining the
third condition under Article 13, i.e. the phrase “do not unreasonably
prejudice the legitimate interests of the right holder”, the Panel
distinguished several steps in the analysis of this requirement:
“We note that the analysis of the third condition of
Article 13 of
the TRIPS Agreement implies several steps. First, one has to define what
are the ‘interests’ of right holders at stake and which attributes
make them ‘legitimate’. Then, it is necessary to develop an
interpretation of the term ‘prejudice’ and what amount of it reaches
a level that should be considered ‘unreasonable’.”(128)
123. The Panel then proceeded to examined each of these terms in turn
and began with their ordinary meaning:
“The ordinary meaning of the term ‘interests’ may encompass a
legal right or title to a property or to use or benefit of a property
(including intellectual property). It may also refer to a concern about
a potential detriment or advantage, and more generally to something that
is of some importance to a natural or legal person. Accordingly, the
notion of ‘interests’ is not necessarily limited to actual or
potential economic advantage or detriment.
The term ‘legitimate’ has the meanings of
‘(a) conformable to, sanctioned or authorized by, law or principle;
lawful; justifiable; proper;
(b) normal, regular, conformable to a recognized standard type.’
Thus, the term relates to lawfulness from a legal positivist
perspective, but it has also the connotation of legitimacy from a more
normative perspective, in the context of calling for the protection of
interests that are justifiable in the light of the objectives that
underlie the protection of exclusive rights.
We note that the ordinary meaning of ‘prejudice’ connotes damage,
harm or injury. ‘Not unreasonable’ connotes a slightly stricter
threshold than ‘reasonable’. The latter term means ‘proportionate’,
‘within the limits of reason, not greatly less or more than might be
thought likely or appropriate’, or ‘of a fair, average or
considerable amount or size’.”(129)
124. After considering the ordinary meaning of the individual terms
of the phrase “do not unreasonably prejudice the legitimate interests
of the right holder”, the Panel considered these terms more
specifically:
“Given that the parties do not question the ‘legitimacy’ of the
interest of right holders to exercise their rights for economic gain,
the crucial question becomes which degree or level of ‘prejudice’
may be considered as ‘unreasonable’. Before dealing with the
question of what amount or which kind of prejudice reaches a level
beyond reasonable, we need to find a way to measure or quantify
legitimate interests.
In our view, one — albeit incomplete and thus conservative — way
of looking at legitimate interests is the economic value of the
exclusive rights conferred by copyright on their holders. It is possible
to estimate in economic terms the value of exercising, e.g., by
licensing, such rights. That is not to say that legitimate interests are
necessarily limited to this economic value.
In examining the second condition of Article
13, we have addressed
the US argument that the prejudice to right holders caused by the
exemptions at hand are minimal because they already receive royalties
from broadcasting stations. We concluded that each exclusive right
conferred by copyright, inter alia, under each subparagraph of
Articles 11bis and 11 of the Berne Convention
(1971), has to be
considered separately for the purpose of examining whether a possible
conflict with a ‘normal exploitation’ exists.
The crucial question is which degree or level of ‘prejudice’ may
be considered as ‘unreasonable’, given that, under the third
condition, a certain amount of ‘prejudice’ has to be presumed
justified as ‘not unreasonable’. In our view, prejudice to the
legitimate interests of right holders reaches an unreasonable level if
an exception or limitation causes or has the potential to cause an
unreasonable loss of income to the copyright owner.”(130)
125. The Panel indicated that the “reasonableness” of the
prejudice to the right holder should not be assessed only with respect
to the parties of the dispute at hand:
“However, given our considerations above, our assessment of whether
the prejudice, caused by the exemptions contained in Section 110(5), to
the legitimate interests of the right holder is of an unreasonable level
is not limited to the right holders of the European Communities.”(131)
126. With respect to its methodology for examination of the existence
of a prejudice, the Panel stated that it would consider information on
market conditions and consider both actual and potential effects:
“We will consider the information on market conditions provided by
the parties taking into account, to the extent feasible, the actual as
well as the potential prejudice caused by the exemptions, as a
prerequisite for determining whether the extent or degree of prejudice
is of an unreasonable level. In these respects, we recall our
consideration above that taking account of actual as well as potential
effects is consistent with past GATT/WTO dispute settlement practice.
…
[I]n considering the prejudice to the legitimate interests of right
holders caused by the business exemption, we have to take into account
not only the actual loss of income from those restaurants that were
licensed by the CMOs at the time that the exemption become effective,
but also the loss of potential revenue from other restaurants of similar
size likely to play music that were not licensed at that point.”(132)
XV. Article 14
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A. Text of
Article 14
Article 14: Protection of Performers, Producers of Phonograms (Sound Recordings) and Broadcasting Organizations
1.
In respect of a fixation of their performance on a phonogram,
performers shall have the possibility of preventing the following acts
when undertaken without their authorization: the fixation of their
unfixed performance and the reproduction of such fixation. Performers
shall also have the possibility of preventing the following acts when
undertaken without their authorization: the broadcasting by wireless
means and the communication to the public of their live performance.
2.
Producers of phonograms shall enjoy the right to authorize or
prohibit the direct or indirect reproduction of their phonograms.
3.
Broadcasting organizations shall have the right to prohibit the
following acts when undertaken without their authorization: the
fixation, the reproduction of fixations, and the rebroadcasting by
wireless means of broadcasts, as well as the communication to the public
of television broadcasts of the same. Where Members do not grant such
rights to broadcasting organizations, they shall provide owners of
copyright in the subject matter of broadcasts with the possibility of
preventing the above acts, subject to the provisions of the Berne
Convention (1971).
4.
The provisions of Article 11 in respect of computer programs shall
apply mutatis mutandis to producers of phonograms and any other
right holders in phonograms as determined in a Member’s law. If on 15
April 1994 a Member has in force a system of equitable remuneration of
right holders in respect of the rental of phonograms, it may maintain
such system provided that the commercial rental of phonograms is not
giving rise to the material impairment of the exclusive rights of
reproduction of right holders.
5.
The term of the protection available under this Agreement to
performers and producers of phonograms shall last at least until the end
of a period of 50 years computed from the end of the calendar year in
which the fixation was made or the performance took place. The term of
protection granted pursuant to paragraph 3 shall last for at least 20
years from the end of the calendar year in which the broadcast took
place.
6.
Any Member may, in relation to the rights conferred under
paragraphs 1, 2 and 3, provide for conditions, limitations, exceptions
and reservations to the extent permitted by the Rome Convention.
However, the provisions of Article 18 of the Berne Convention (1971)
shall also apply, mutatis mutandis, to the rights of performers
and producers of phonograms in phonograms.
B. Interpretation and Application of Article 14
No jurisprudence or decision of a competent WTO body.
XVI. Article 15
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A. Text of Article 15
Article 15: Protectable Subject Matter
1. Any sign, or any combination of signs, capable of distinguishing
the goods or services of one undertaking from those of other
undertakings, shall be capable of constituting a trademark. Such signs,
in particular words including personal names, letters, numerals,
figurative elements and combinations of colours as well as any
combination of such signs, shall be eligible for registration as
trademarks. Where signs are not inherently capable of distinguishing the
relevant goods or services, Members may make registrability depend on
distinctiveness acquired through use. Members may require, as a
condition of registration, that signs be visually perceptible.
2.
Paragraph 1 shall not be understood to prevent a Member from
denying registration of a trademark on other grounds, provided that they
do not derogate from the provisions of the Paris Convention (1967).
3. Members may make registrability depend on use. However, actual use
of a trademark shall not be a condition for filing an application for
registration. An application shall not be refused solely on the ground
that intended use has not taken place before the expiry of a period of
three years from the date of application.
4. The nature of the goods or services to which a trademark is to be
applied shall in no case form an obstacle to registration of the
trademark.
5. Members shall publish each trademark either before it is
registered or promptly after it is registered and shall afford a
reasonable opportunity for petitions to cancel the registration. In
addition, Members may afford an opportunity for the registration of a
trademark to be opposed.
B. Interpretation and Application of Article 15
1. Article 15.1
127. In US — Section 211 Appropriations Act, the Appellate
Body rejected an argument that Members must register trademarks that
meet the requirements of Article 15.1:
“ It follows that the wording of Article 15.1 allows WTO Members to
set forth in their domestic legislation conditions for the registration
of trademarks that do not address the definition of either ‘protectable
subject-matter’ or of what constitutes a trademark.
…
In our view, Article 15.1 of the TRIPS Agreement limits the
right of Members to determine the ‘conditions’ for filing and
registration of trademarks under their domestic legislation pursuant to
Article 6(1) [of the Paris Convention (1967) as incorporated in the
TRIPS Agreement] only as it relates to the distinctiveness
requirements enunciated in Article 15.1.”(133)
2. Article 15.2
128. In US — Section 211 Appropriations Act, the Appellate
Body found that paragraph 2 of Article 15 permits Members to deny
trademark registration on grounds other than those expressly provided
for in the TRIPS Agreement and the Paris Convention (1967):
“The specific reference to Article 15.1 in
Article 15.2 makes it
clear that the ‘other grounds’ for denial of registration to which
Article 15.2 refers are different from those mentioned in Article
15.1….
…
… a condition need not be expressly mentioned in the Paris
Convention (1967) in order not to ‘derogate’ from it. Denial of
registration on ‘other grounds’ would derogate from the Paris
Convention (1967) only if the denial were on grounds that are
inconsistent with the provisions of that Convention.
[We] conclude also that ‘other grounds’ for the denial of
registration within the meaning of Article 15.2 of the TRIPS
Agreement are not limited to grounds expressly provided for in the
exceptions contained in the Paris Convention (1967) or the TRIPS
Agreement… .”(134)
XVII. Article 16
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A. Text of Article 16
Article 16: Rights Conferred
1. The owner of a registered trademark shall have the exclusive right
to prevent all third parties not having the owner’s consent from using
in the course of trade identical or similar signs for goods or services
which are identical or similar to those in respect of which the
trademark is registered where such use would result in a likelihood of
confusion. In case of the use of an identical sign for identical goods
or services, a likelihood of confusion shall be presumed. The rights
described above shall not prejudice any existing prior rights, nor shall
they affect the possibility of Members making rights available on the
basis of use.
2.
Article 6bis of the Paris Convention (1967) shall apply, mutatis
mutandis, to services. In determining whether a trademark is
well-known, Members shall take account of the knowledge of the trademark
in the relevant sector of the public, including knowledge in the Member
concerned which has been obtained as a result of the promotion of the
trademark.
3.
Article 6bis of the Paris Convention (1967) shall apply, mutatis
mutandis, to goods or services which are not similar to those in
respect of which a trademark is registered, provided that use of that
trademark in relation to those goods or services would indicate a
connection between those goods or services and the owner of the
registered trademark and provided that the interests of the owner of the
registered trademark are likely to be damaged by such use.
B. Interpretation and Application of Article 16
1. General
129. In its review under
Article 24.2 concerning the application of
the provisions from the Section of the TRIPS Agreement on geographical
indications, the Council for TRIPS invited Members to respond to a
Checklist of Questions, some of which relate to Article
16. See
paragraph 170 below.
2. Article 16.1
(a) “The owner”
130. In US — Section 211 Appropriations Act, the Appellate
Body found that the TRIPS Agreement does not contain a provision that
determines who owns or who does not own a trademark:
“As we read it, Article 16 confers on the owner of a registered
trademark an internationally agreed minimum level of ‘exclusive rights’
that all WTO Members must guarantee in their domestic legislation. These
exclusive rights protect the owner against infringement of the
registered trademark by unauthorized third parties.
We underscore that Article 16.1 confers these exclusive rights on the
‘owner’ of a registered trademark. As used in this treaty provision,
the ordinary meaning of ‘owner’ can be defined as the proprietor or
the person who holds the title or dominion of the property constituted
by the trademark. We agree with the Panel that this ordinary meaning
does not clarify how the ownership of a trademark is to be determined.
Also, we agree with the Panel that Article 16.1 does not, in express
terms, define how ownership of a registered trademark is to be
determined. Article 16.1 confers exclusive rights on the ‘owner’,
but Article 16.1 does not tell us who the ‘owner’ is.
…
[W]e conclude that neither Article 16.1 of the TRIPS Agreement,
nor any other provision of either the TRIPS Agreement and the
Paris Convention (1967), determines who owns or who does not own a
trademark.”(135)
(b) “the exclusive right”
131. In EC — Trademarks and Geographical Indications the
Panel interpreted the exclusive right which must be conferred under
Article 16.1 as a negative right that belongs to the owner of the
registered trademark alone to prevent certain uses by “all third
parties” not having the owner’s consent, subject to certain
exceptions:
“The right which must be conferred on the owner of a registered
trademark is set out in the first sentence of the text. There are
certain limitations on that right which relate to use in the course of
trade, the signs, the goods or services for which the signs are used and
those with respect to which they are registered and the likelihood of
confusion. The ordinary meaning of the text indicates that, basically,
this right applies to use in the course of trade of identical or similar
signs, on identical or similar goods, where such use would result in a
likelihood of confusion. It does not specifically exclude use of signs
protected as GIs.
The text of Article 16.1 stipulates that the right for which it
provides is an “exclusive” right. This must signify more than the
fact that it is a right to “exclude” others, since that notion is
already captured in the use of the word “prevent”. Rather, it
indicates that this right belongs to the owner of the registered
trademark alone, who may exercise it to prevent certain uses by “all
third parties” not having the owner’s consent. The last sentence
provides for an exception to that right, which is that it shall not
prejudice any existing prior rights. Otherwise, the text of Article 16.1
is unqualified.
Other exceptions to the right under Article 16.1 are provided for in
Article 17 and possibly elsewhere in the TRIPS Agreement. However, there
is no implied limitation vis-à-vis GIs in the text of Article 16.1 on
the exclusive right which Members must make available to the owner of a
registered trademark. That right may be exercised against a third party
not having the owner’s consent on the same terms, whether or not the
third party uses the sign in accordance with GI protection, subject to
any applicable exception.”(136)
132. In EC — Trademarks and Geographical Indications the
Panel clarified that the right to be conferred under Article 16.1 is a
negative right:
“Article 16.1 of the TRIPS Agreement only provides for a negative
right to prevent all third parties from using signs in certain
circumstances.”(137)
133. The Panel in EC — Trademarks and Geographical Indications
(Australia) did not uphold a claim that the right provided for in
Article 16.1 includes a right to object to GI registration:
“Article 16.1 of the TRIPS Agreement sets out the minimum right
which Members must provide to the owners of registered trademarks and
which they may also make available on the basis of use. It is a right
for trademark owners to prevent certain uses. The Panel takes note that
trademark owners are not able to exercise their right to prevent use of
a GI after GI registration. However, Australia has not explained why the
trademark owner’s right to prevent use implies a right to object to GI
registration.
“Article 15.5 provides for a right of objection to registration of
a trademark but there is no corresponding provision in Part II
regarding the registration of a GI. There are provisions on the
acquisition and maintenance of intellectual property rights, including
GIs, in Article 62. These specifically refer to related inter partes
procedures such as opposition, revocation and cancellation, in paragraph
4, which is cross-referenced in paragraph 5. The opportunity or right to
object forms part of an opposition procedure. However, Article 62 lies
outside the Panel’s terms of reference.”(138)
(c) “a likelihood of confusion shall be presumed”
134. The Panel in EC — Trademarks and Geographical Indications
(Australia), explained that the second sentence of Article 16.2
clarifies the first sentence:
“Article 16.1 of the TRIPS
Agreement, in its first sentence,
provides for a right that refers to “identical or similar” “signs”
and “goods or services” and depends on a “likelihood of confusion”.
In its second sentence, it provides for a presumption of a “likelihood
of confusion” with respect to use of an “identical sign for
identical goods or services”. Therefore, the second sentence clarifies
how the first sentence is implemented, in particular circumstances.”(139)
(d) “making rights available on the basis of use”
135. In US — Section 211 Appropriations Act, the Appellate
Body rejected an argument that the holder of a trademark registration
must, under Article 16.1, be considered the owner of the trademark until
such time as it ceases to hold the registration:
“We recall that the European Communities contends that the Panel
created an artificial distinction between the owner of a registered
trademark and the trademark itself. We disagree with the apparent
equation by the European Communities of trademark registration with
trademark ownership. Here, again, the European Communities appears to us
to overlook the necessary legal distinction between a trademark system
in which ownership is based on registration and a trademark system in
which ownership is based on use. As we have noted more than once, United
States law confers exclusive trademark rights, not on the basis of
registration, but on the basis of use. There is nothing in Article 16.1
that compels the United States to base the protection of exclusive
rights on registration. Indeed, as we have also observed more than once,
the last sentence of Article 16.1 confirms that WTO Members may make
such rights available on the basis of use. The United States has done
so. Therefore, it necessarily follows that, under United States law,
registration is not conclusive of ownership of a trademark. Granted,
under United States law, the registration of a trademark does confer a prima
facie presumption of the registrant’s ownership of the registered
trademark and of the registrant’s exclusive right to use that
trademark in commerce. But, while we agree with the Panel that the
presumptive owner of the registered trademark must be entitled,
under United States law, to the exclusive rights flowing from Article
16.1 unless and until the presumption arising from registration is
successfully challenged through court or administrative proceedings, we
do not agree with the European Communities’ evident equation of
registration with ownership.”(140)
XVIII. Article 17
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A. Text of Article 17
Article 17: Exceptions
Members may provide limited exceptions to the rights conferred by a
trademark, such as fair use of descriptive terms, provided that such
exceptions take account of the legitimate interests of the owner of the
trademark and of third parties.
B. Interpretation and Application of
Article 17
1. General
(a) “Limited exceptions”
136. In EC — Trademarks and Geographical Indications the
Panel interpreted the phrase “limited exceptions” to refer to a
narrow exception to the rights conferred by a trademark, rather than to
an exception that affected only few trademarks or few trademark owners.
It considered that the limitation should be assessed as a legal, rather
than an economic, matter:
“The first issue to decide is the meaning of the term “limited
exceptions” as used in Article 17. The United States interprets this
in terms of a small diminution of rights. The European Communities does
not disagree with this approach. The Panel agrees with the views of the
Panel in Canada — Pharmaceutical Patents, which interpreted the
identical term in Article 30, that “[t]he word ‘exception’ by
itself connotes a limited derogation, one that does not undercut the
body of rules from which it is made”.(141) The addition of the word “limited”
emphasizes that the exception must be narrow and permit only a small
diminution of rights. The limited exceptions apply “to the rights
conferred by a trademark”. They do not apply to the set of all
trademarks or all trademark owners. Accordingly, the fact that it may
affect only few trademarks or few trademark owners is irrelevant to the
question whether an exception is limited. The issue is whether the
exception to the rights conferred by a trademark is narrow.
There is only one right conferred by a trademark at issue in this
dispute, namely the exclusive right to prevent certain uses of a sign,
provided for in Article 16.1. Therefore, it is necessary to examine the
exception on an individual “per right” basis. This is a legal
assessment of the extent to which the exception curtails that right.
There is no indication in the text of Article 17 that this involves an
economic assessment, although economic impact can be taken into account
in the proviso. In this regard, we note the absence of any reference to
a “normal exploitation” of the trademark in Article
17, and the
absence of any reference in Section 2, to which Article 17 permits
exceptions, to rights to exclude legitimate competition. Rather, they
confer, inter alia, the right to prevent uses that would result
in a likelihood of confusion, which can lead to the removal of products
from sale where they are marketed using particular signs, but without
otherwise restraining the manufacture, sale or importation of competing
goods or services.”(142)
137. In EC — Trademarks and Geographical Indications the
Panel took into account, in determining whether an exception could be
considered a “limited exception”, the fact that it prevented a
trademark owner from exercising its exclusive right to prevent use only
against persons using a GI on goods in accordance with its registration:
“[T]he European Communities has emphasized that the trademark owner
retains the right to prevent the use of a name registered as a GI by any
person in relation to any goods which originate in a different
geographical area or which do not comply with the specifications, and
that the positive right to use the GI extends only to the linguistic
versions that have been entered in the register and not to other names
or signs which have not been registered. Accordingly, on the basis of
the terms of the GI Regulation and of the Community Trademark
Regulation, and the explanation of them provided by the European
Communities, the Panel finds that not only may the trademark continue to
be used, but that the trademark owner’s right to prevent confusing
uses is unaffected except with respect to the use of a GI as entered in
the GI register in accordance with its registration.
“Furthermore, the European Communities has explained that the use
of a name registered as a GI is subject to the applicable provisions of
the food labelling and misleading advertising directives so that the
ways in which it may be used are not unlimited.”(143)
(b) “such as fair use of descriptive terms”
138. In EC — Trademarks and Geographical Indications the
Panel extrapolated from the example of “fair use of descriptive terms”
in interpreting the term “limited exception” for the purposes of
Article 17:
“The example in the text, “fair use of descriptive terms”,
provides guidance as to what is considered a “limited exception”,
although it is illustrative only. Fair use of descriptive terms is
inherently limited in terms of the sign which may be used and the degree
of likelihood of confusion which may result from its use, as a purely
descriptive term on its own is not distinctive and is not protectable as
a trademark. Fair use of descriptive terms is not limited in
terms of the number of third parties who may benefit, nor in terms of
the quantity of goods or services with respect to which they use the
descriptive terms, although implicitly it only applies to those third
parties who would use those terms in the course of trade and to those
goods or services which those terms describe. The number of trademarks
or trademark owners affected is irrelevant, although implicitly it would
only affect those marks which can consist of, or include, signs that can
be used in a descriptive manner. According to the text, this is a “limited”
exception for the purposes of Article 17.”(144)
(c) “legitimate interests”
139. In EC — Trademarks and Geographical Indications the
Panel considered that “legitimate” interests were different from the
enjoyment of legal rights:
“Limited exceptions must satisfy the proviso that “such
exceptions take account of the legitimate interests of the owner of the
trademark and of third parties” in order to benefit from Article
17.
We must first establish what are “legitimate interests”. Read in
context, the “legitimate interests” of the trademark owner are
contrasted with the “rights conferred by a trademark”, which also
belong to the trademark owner. Given that Article 17 creates an
exception to the rights conferred by a trademark, the “legitimate
interests” of the trademark owner must be something different from
full enjoyment of those legal rights. The “legitimate interests” of
the trademark owner are also compared with those of “third parties”,
who have no rights conferred by the trademark. Therefore, the “legitimate
interests”, at least of third parties, are something different from
simply the enjoyment of their legal rights. This is confirmed by the use
of the verb “take account of”, which is less than “protect”.”(145)
(d) “take account of the legitimate interests of the owner of the
trademark”
140. In EC — Trademarks and Geographical Indications the
Panel found that an EC Regulation took account of the legitimate
interests of the owner of the trademark because it took account of the
owner’s interest in preserving the distinctiveness, or capacity to
distinguish, of its trademark so that it could distinguish the goods and
services of its undertaking in the course of trade:
“The legitimacy of some interest of the trademark owner is assumed
because the owner of the trademark is specifically identified in Article
17. The TRIPS Agreement itself sets out a statement of what all WTO
Members consider adequate standards and principles concerning trademark
protection. Although it sets out standards for legal rights, it also
provides guidance as to WTO Members’ shared understandings of the
policies and norms relevant to trademarks and, hence, what might be the
legitimate interests of trademark owners. The function of trademarks can
be understood by reference to Article 15.1 as distinguishing goods and
services of undertakings in the course of trade. Every trademark owner
has a legitimate interest in preserving the distinctiveness, or capacity
to distinguish, of its trademark so that it can perform that function.
This includes its interest in using its own trademark in connection with
the relevant goods and services of its own and authorized undertakings.
Taking account of that legitimate interest will also take account of the
trademark owner’s interest in the economic value of its mark arising
from the reputation that it enjoys and the quality that it denotes.”(146)
141. In EC — Trademarks and Geographical Indications the
Panel considered that a limited exception can permit a certain degree of
likelihood of confusion that may affect the distinctiveness of the
trademark:
“Where Articles 7(4) and 14(3) of the Regulation are unavailable,
and a trademark is subject to Article 14(2), there remains the
possibility that its distinctiveness will be affected by the use of the
GI. We do not consider this fatal to the applicability of Article 17
given that, as a provision permitting an exception to the exclusive
right to prevent uses that would result in a likelihood of confusion, it
presupposes that a certain degree of likelihood of confusion can be
permitted. In the light of the provisions of Articles 7(4) and 14(3),
we are satisfied that where the likelihood of confusion is relatively
high, the exception in Article 14(2) will not apply. In any event, even
where the exception does apply, Article 14(2) expressly provides that
the trademark may continue to be used, on certain conditions.
We also note that the proviso to Article 17 requires only that
exceptions “take account” of the legitimate interests of the owner
of the trademark, and does not refer to “unreasonabl[e] prejudice”
to those interests, unlike the provisos in Articles
13, 26.2 and 30 of
the TRIPS Agreement and Article 9(2) of the Berne Convention (1971) as
incorporated by Article 9.1 of the TRIPS
Agreement. This suggests that a
lesser standard of regard for the legitimate interests of the owner of
the trademark is required.”(147)
(e) “legitimate interests of
… third parties”
142. In EC — Trademarks and Geographical Indications the
Panel considered that “third parties” include consumers:
“The parties to this dispute agree that “third parties” for the
purposes of Article 17 include consumers. The function of a trademark is
to distinguish goods and services of undertakings in the course of
trade. That function is served not only for the owner, but also for
consumers. Accordingly, the relevant third parties include consumers.
Consumers have a legitimate interest in being able to distinguish the
goods and services of one undertaking from those of another, and to
avoid confusion.”(148)
143. In EC — Trademarks and Geographical Indications the
Panel also considered that “third parties” may include GI users:
“The European Communities submits that “third parties” for the
purposes of Article 17 include persons using a GI in accordance with a
GI registration. The Panel agrees. Article 17 permits an exception to
the rights conferred by a trademark which include, according to Article
16.1, a right to prevent “all third parties” from using certain
signs. The basis of the complainant’s claim is that those third
parties include GI users. It is logical that, if GI users are included
in the third parties subject to the trademark owner’s right, they are
also included in the third parties taken into account in assessing the
availability of an exception to that right.
The legitimacy of the interests of GI users is reflected in the TRIPS
Agreement itself, to which all WTO Members have subscribed. Under
Section 3 of Part II, all WTO Members agree to provide certain
protection to GIs, although they remain free to determine the
appropriate method of implementing those provisions in accordance with
Article 1.1. The definition of a GI in Article 22.1 reflects a
legitimate interest that a person may have in identifying the source and
other characteristics of a good by the name of the place where it is
from, if the name would serve that purpose. Nevertheless, as “legitimate
interests”, the interests of GI users as third parties within the
meaning of Article 17 would be different from the legal protection
provided for in Articles 22 and 23.”(149)
(f) Burden of Proof
144. In EC — Trademarks and Geographical Indications the
Panel followed the approach of the Panels in US — Section 110(5)
Copyright Act and Canada — Pharmaceutical Patents to
exception’s provisions, namely that the party asserting that its
measure is covered by the exception in Article 17 bears the burden of
proving that assertion, as this approach was not contested:
“The United States submits that the European Communities, as the
party asserting that its measure is covered by the exception in Article
17, bears the burden of proving that assertion. The European Communities
does not contest this position. Therefore, the Panel will follow this
approach in the present dispute.”(150)
(g) Relationship with other Articles
145. In EC — Trademarks and Geographical Indications the
Panel noted the differences between Article 17, on the one hand, and
Articles 13, 26.2 and 30 of the TRIPS
Agreement, as well as Article 9(2)
of the Berne Convention (1971) as incorporated by Article 9.1 of the
TRIPS Agreement, on the other hand. Although the Panel did refer to
jurisprudence on “limited exceptions” and “legitimate interests”
under Article 30 of the TRIPS
Agreement, it expressed caution in
referring to these other provisions when interpreting Article
17:
“The structure of Article 17 differs from that of other exceptions
provisions to which the parties refer. It can be noted that Articles
13,
26.2 and 30 of the TRIPS
Agreement, as well as Article 9(2) of the Berne
Convention (1971) as incorporated by Article 9.1 of the TRIPS
Agreement,
also permit exceptions to intellectual property rights and all contain,
to varying degrees, similar language to Article 17. However, unlike
these other provisions, Article 17 contains no reference to “conflict
with a [or the] normal exploitation”, no reference to “unreasonabl[e]
prejudice” to the legitimate interests” of the right holder or
owner, and it not only refers to the legitimate interests of third
parties but treats them on par with those of the right holder. It is
also the only one of these provisions which contains an example.
Further, Article 17 permits exceptions to trademark rights, which differ
from each of the intellectual property rights to which these other
exceptions apply. Therefore, whilst it is instructive to refer to the
interpretation by two previous panels of certain shared elements found
in Articles 13 and 30, it is important to interpret
Article 17 according
to its own terms.”(151)
146. With respect to the relationship of
Article 17 to Article 9(2)
of the Berne Convention (1971) and Articles 13,
26.2 and 30 of the TRIPS
Agreement, see also footnote 207.
XIX. Article 18
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A. Text of Article 18
Article 18: Term of Protection
Initial registration, and each renewal of registration, of a
trademark shall be for a term of no less than seven years. The
registration of a trademark shall be renewable indefinitely.
B. Interpretation and Application of Article 18
No jurisprudence or decision of a competent WTO body.
XX. Article 19
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A. Text of Article 19
Article 19: Requirement of Use
1. If use is required to maintain a registration, the registration
may be cancelled only after an uninterrupted period of at least three
years of non-use, unless valid reasons based on the existence of
obstacles to such use are shown by the trademark owner. Circumstances
arising independently of the will of the owner of the trademark which
constitute an obstacle to the use of the trademark, such as import
restrictions on or other government requirements for goods or services
protected by the trademark, shall be recognized as valid reasons for
non-use.
2. When subject to the control of its owner, use of a trademark by
another person shall be recognized as use of the trademark for the
purpose of maintaining the registration.
B. Interpretation and Application of Article 19
No jurisprudence or decision of a competent WTO body.
Footnotes:
1. Appellate
Body Report, India — Patents (US), para. 57. back to text
2. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.131, and (Australia),
para. 7181. back to text
3. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.620, and (Australia),
para. 7.620. back to text
4. Panel
Report, EC — Trademarks and Geographical Indications (US),
para. 7.742. See also Panel
Reports, EC — Trademarks and Geographical Indications (US)
para. 7.682 and (Australia),
para. 7.680. back to text
5. Panel
Report, China — Intellectual Property Rights, para. 7.513. back to text
6. Panel
Report, EC — Trademarks and Geographical Indications (Australia),
para. 7.755. back to text
7. Appellate
Body Report, India — Patents (US), para. 59. back to text
8. Panel
Report, Canada — Patent Term, para. 6.94. back to text
9. Panel
Report, EC — Trademarks and Geographical Indications (US),
paras. 7.766–7.767. back to text
10. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.746. See also Panel
Reports, EC — Trademarks and Geographical Indications (US)
para. 7.682, and (Australia),
para. 7.680. See further para. 112. back to text
11. Panel
Report, China — Intellectual Property Rights, para. 7.513. back to text
12. Appellate
Body Report, US — Section 211 Appropriations Act, para.
335. back to text
13. Panel
Reports, EC — Trademarks and Geographical Indications (US),
paras. 7.126–7.128 and (Australia),
paras. 7.176–7.178. back to text
14. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.147, and (Australia),
para. 7.197. back to text
15. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.142 and (Australia),
para. 7.192. back to text
16. Panel
Report, EC — Trademarks and Geographical Indications (US),
paras. 7.162–7.167. back to text
17. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.198, and (Australia),
para. 7.234. back to text
18. Appellate
Body Report, US — Section 211 Appropriations Act, paras.
336, 337 and 341. back to text
19. Panel
Reports, EC — Trademarks and Geographical Indications (US),
paras. 7.216 and (Australia),
paras. 7.252. back to text
20. See United States’ rebuttal submission,
paras. 49 and 60, which refer to no less favourable treatment. back to text
21. Panel
Reports, EC — Trademarks and Geographical Indications (US),
paras. 7.432. back to text
22. Panel
Report, EC — Trademarks and Geographical Indications (US),
paras. 7.216 and (Australia),
para. 7.253. back to text
23. Panel
Report, EC — Trademarks and Geographical Indications (US),
para. 7.144. back to text
24. Appellate
Body Report, US — Section 211 Appropriations Act, paras.
175–176. back to text
25. Panel
Report, US — Section 211 Appropriations Act, para. 8.120. back to text
26. Decision of the Council for TRIPS,
document IP/C/7.
back to text
27. The text of the Agreement can be found in
IP/C/6.
back to text
28. Appellate
Body Report, US — Section 211 Appropriations Act, para.
147. back to text
29. Appellate
Body Report, US — Section 211 Appropriations Act, paras.
338 and 341. back to text
30. Appellate
Body Report, US — Section 211 Appropriations Act, para.
359. back to text
31. Panel
Report in EC — Trademarks and Geographical Indications (US),
para. 7.170. See also Panel
Report in EC — Trademarks and Geographical Indications (Australia),
para. 7.203. back to text
32. Decision by the Arbitrators, EC
— Bananas (Ecuador) (Article 22.6 — EC), para. 149. back to text
33. Panel
Reports, EC — Trademarks and Geographical Indications (US),
paras. 7.274–7.275, and (Australia),
paras. 7.309–7.310. See also, with respect to objection
procedures, para. 7.342 and para. 7.375, respectively. back to text
34. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.141, and (Australia),
para. 7.191. See paras. 15 and 16
above. back to text
35. Panel
Report, Indonesia — Autos, para. 14.268. back to text
36. Panel
Report, Indonesia — Autos, para. 14.271. back to text
37. Panel
Report, Indonesia — Autos, para. 14.273. back to text
38. Appellate
Body Report, US — Section 211 Appropriations Act, paras.
261–263, quoting from GATT Panel Report, US — Section 337,
paras. 5.11, 5.12 and 5.19. back to text
39. Appellate
Body Report, US — Section 211 Appropriations Act, para.
286. back to text
40. Appellate
Body Report, US — Section 211 Appropriations Act, para.
294. back to text
41. Appellate
Body Report, US — Section 211 Appropriations Act, para.
289. back to text
42. Appellate
Body Report, US — Section 211 Appropriations Act, para.
265. back to text
43. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.139, and (Australia),
para. 7.189, citing the Appellate
Body Report in US — Section 211 Appropriations Act, para.
268. back to text
44. Panel
Reports, EC — Trademarks and Geographical Indications (US),
paras. 7.271–7.272, and (Australia),
paras. 7.306–7.307. See also, analogous findings with respect
to objection procedures in the EC Regulation, (US) paras.
7.340–7.341, and (Australia)
paras. 7.373–7.374, and with respect to government participation in
inspection structures under the EC Regulation, (US) paras.
7.426–7.428. back to text
45. Panel
Report, EC — Trademarks and Geographical Indications (Australia),
para. 7.400. back to text
46. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.176, and (Australia),
para. 7.210. back to text
47. Panel
Report, US — Section 211 Appropriations Act, para. 8.131,
citing the GATT panel report in US — Section 337, at para.
5.11, and see Appellate
Body Report, US — Section 211 Appropriations Act, para.
258. back to text
48. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.133, and (Australia),
para. 7.184. back to text
49. Panel
Reports, EC — Trademarks and Geographical Indications (US),
paras. 7.136 and 7.137, and (Australia),
paras. 7.186–7.187, quoting the Appellate
Body Report, US — FSC (Article 21.5 — EC), para. 215. back to text
50. Panel
Reports, EC — Trademarks and Geographical Indications (US),
paras. 7.181–7.182, and (Australia),
paras. 7.217–7.218. back to text
51. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.148. back to text
52. Panel
Reports, EC — Trademarks and Geographical Indications (US),
paras. 7.149–7.150, and (Australia),
paras. 7.199–7.200. back to text
53. Panel
Report, EC — Trademarks and Geographical Indications (US),
paras. 7.412–7.413. back to text
54. Appellate
Body Report, US — Section 211 Appropriations Act, paras.
352 to 356. back to text
55. Panel
Report, Indonesia — Autos, paras. 14.275–14.276. back to text
56. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.126, and (Australia),
para. 7.176. back to text
57. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.128, and (Australia),
para. 7.178. See also with respect to Article
4: (US),
para. 7.700. back to text
58. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.262, and (Australia),
para. 7.298. See also with respect to Article
4: (US),
para. 7.719. back to text
59. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.329, and (Australia),
para. 7.364. See also with respect to Article
4: (US),
para. 7.719. back to text
60. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.403. back to text
61. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.486. back to text
62. IP/C/M/12,
paras. 10–16. The format can be found in IP/C/9.
back to text
63. Appellate
Body Report, US — Section 211 Appropriations Act, para.
242. back to text
64. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.131, and (Australia),
para. 7.181. back to text
65. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.135, and (Australia),
para. 7.185, citing the Panel
Report, US — Section 211 Appropriations Act at para. 8.129
and Appellate Body Report at para. 242. back to text
66. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.208, and (Australia),
para. 7.244, citing the Panel
Report, Canada — Periodicals, at para. 5.17, and Appellate
Body Report, Canada — Periodicals, DSR 1997:I, 449, at 465,
the Appellate
Body Reports, Argentina — Footwear (EC), para. 81, and Korea
— Dairy, para. 74, and the Panel Reports in EC — Bananas
III, para. 7.160. back to text
67. Appellate
Body Report, US — Section 211 Appropriations Act, para.
314. back to text
68. Appellate
Body Report, US — Section 211 Appropriations Act, para.
317. back to text
69. Appellate
Body Report, US — Section 211 Appropriations Act, paras.
352, 353 and 357. back to text
70. Panel
Report, EC — Trademarks and Geographical Indications (US),
paras. 7.699–7.701. back to text
71. Panel
Report, EC — Trademarks and Geographical Indications (US),
paras. 7.703–7.704. back to text
72. Panel
Report, EC — Trademarks and Geographical Indications (US),
para. 7.58. back to text
73. Panel
Report, EC — Trademarks and Geographical Indications (US),
para. 7.704. back to text
74. Panel
Report, EC — Trademarks and Geographical Indications (US),
para. 7.705. back to text
75. See document IP/C/9.
back to text
76. The text of the Declaration can be found
in document WT/MIN (91)/DEC/2, reproduced in Section
LXXVIII below back to text
77. (footnote original) Appellate
Body Report, United States–Shrimps, para. 158. back to text
78. Panel
Report, US — Section 211 Appropriations Act, para. 8.57. back to text
79. The text of the Declaration can be found
in document WT/MIN (91)/DEC/2, reproduced in Section
LXXVIII below back to text
80. The text of the Declaration can be found
in WT/MIN(01)/DEC/1.
back to text
81. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.210, and (Australia),
para. 7.246. back to text
82. The text of the Declaration can be found
in document WT/MIN (91)/DEC/2, reproduced in Section
LXXVIII below back to text
83. The text of the Declaration can be found
in WT/MIN(01)/DEC/1.
back to text
84. Panel
Report, US — Section 110(5) Copyright Act, paras.
6.17–6.18. back to text
85. Panel
Report, US — Section 110(5) Copyright Act, para. 6.41. back to text
86. Panel
Report, US — Section 110(5) Copyright Act, para. 6.66. back to text
87. Panel
Report, US — Section 110(5) Copyright Act, para. 6.70. back to text
88. (footnote original) The Panel
notes that this provision, as incorporated by Article
9.1 of the TRIPS Agreement, is distinct from Article
3.1 of that Agreement. back to text
89. (footnote original) This
enumeration is without prejudice to other such rights. back to text
90. Panel
Report, China — Intellectual Property Rights, paras.
7.106–7.107. back to text
91. Panel
Report, China — Intellectual Property Rights, para. 7.115. back to text
92. (footnote original) However,
public performance by means of cinematographic works is separately
covered in Article 14(1)(ii) of
the Berne Convention. Public performance of a literary work or
communication to the public of the recitation is covered by Article
11ter of the Berne Convention. back to text
93. Panel
Report, US — Section 110(5) Copyright Act, para. 6.24. back to text
94. Panel
Report, US — Section 110(5) Copyright Act, para. 6.51. back to text
95. Article 1.1 of the
TRIPS Agreement makes clear that “Members shall give effect to the
provisions of the [TRIPS] Agreement.” Members must, therefore,
implement in their domestic law the protection required by the TRIPS
Agreement. Moreover, Article 1.3 of the TRIPS
Agreement provides in relevant part that “Members shall accord the
treatment provided for in this Agreement to the nationals of other
Members.” (footnote omitted) This confirms that the exclusive rights
conferred by Articles 11bis(1)(iii)
and 11(1)(ii) must be
granted to EC right holders. back to text
96. Award of the Arbitrator on US —
Section 110(5) Copyright Act (Article 25.3), para. 3.15. back to text
97. Panel
Report, US — Section 110(5) Copyright Act, para. 6.25. back to text
98. Panel
Report, US — Section 110(5) Copyright Act, paras.
6.20–6.22. back to text
99. Article 1.1 of the
TRIPS Agreement makes clear that “Members shall give effect to the
provisions of the [TRIPS] Agreement.” Members must, therefore,
implement in their domestic law the protection required by the TRIPS
Agreement. Moreover, Article 1.3 of the TRIPS
Agreement provides in relevant part that “Members shall accord the
treatment provided for in this Agreement to the nationals of other
Members.” (footnote omitted) This confirms that the exclusive rights
conferred by Articles 11bis
(1)(iii) and 11(1)(ii)
must be granted to EC right holders. back to text
100. Award of the Arbitrator on US —
Section 110(5) Copyright Act (Article 25.3), para. 3.15. back to text
101. Panel
Report, US — Section 110(5) Copyright Act, para. 6.95. back to text
102. Panel
Report, US — Section 110(5) Copyright Act, paras.
6.57–6.58. back to text
103. Panel
Report, US — Section 110(5) Copyright Act, paras. 6.60 and
6.63. back to text
104. (footnote original) Even the
right of a government ‘to permit’ the circulation, presentation, or
exhibition of a work could be exercised for reasons of public order,
such as the publication or broadcast by the police of a photograph of a
wanted criminal: see Masouyé, C., Guide to the Berne Convention,
(World Intellectual Property Organization, 1978) (“WIPO Guide to the
Berne Convention”), para. 17.3. The Panel notes that, as stated in its
preface, this Guide is not intended to be an authentic interpretation of
the provisions of the Berne Convention since such an interpretation is
not within the competence of the International Bureau of WIPO. back to text
105. (footnote original) For example,
the term “la représentation” is expressly included in the French
text in Article 17 as well as in Articles
11(1)(i) (ii), 14(1)(ii) and 14bis(2)(b) in the phrase “la représentation
et l’exécution”, rendered as “performance” in the English text.
back to text
106. (footnote original) For example,
the word “la circulation” used in Article 17
of the French text is also used in provisions on possible limitations on
the rights of translation and reproduction in Articles
I(4), II(6), II(8),
III(2)(b), III(4)(d),
III(6) and IV(5) of the
Appendix, rendered
as “circulation” in the English text in Articles II(8) and
III(4)(d)
of the Appendix and “distributed” or “distribution” elsewhere. back to text
107. (footnote original) The word
“exhibition” in Article 17 is also used in
the definition of “published works” in Article
3(3) which provides inter alia that “the exhibition of a
work of art … shall not constitute publication.” Article
3(3) of the French text also uses the word “la représentation”
of certain categories of works for the same purpose. back to text
108. Panel
Report, China — Intellectual Property Rights, paras.
7.126–7.127. back to text
109. Panel
Report, China — Intellectual Property Rights, paras.
7.132–7.133 and 7.135. back to text
110. Panel
Report, US — Section 110(5) Copyright Act, para. 6.82. back to text
111. IP/C/M/19,
para. 8; IP/C/14.
back to text
112. Panel
Report, US — Section 110(5) Copyright Act, para. 6.80. back to text
113. Panel
Report, US — Section 110(5) Copyright Act, para. 6.97. back to text
114. Panel
Report, US — Section 110(5) Copyright Act, para. 6.94.
back to text
115. Panel
Report, US — Section 110(5) Copyright Act, paras.
6.87–6.89. back to text
116. Panel
Report, US — Section 110(5) Copyright Act, para. 6.90. back to text
117. Panel
Report, US — Section 110(5) Copyright Act, para. 6.112. back to text
118. (footnote original) We note that
the term “special purpose” has been referred to in interpreting the
largely similarly worded Article
9(2) of the Berne Convention (1971). See Ricketson, The Berne
Convention, op.cit., p. 482. We are ready to take into account
“teachings of the most highly qualified publicists of the various
nations” as a “subsidiary source for the determination of law”. We
refer to this phrase in the sense of Article 38(d) of the Statute of the
International Court of Justice which refers to such “teachings” (or,
in French “la doctrine”) as “subsidiary means for the
determination of law.” But we are cautious to use the interpretation
of a term developed in the context of an exception for the reproduction
right for interpreting the same terms in the context of a largely
similarly worded exception for other exclusive rights conferred by
copyrights. back to text
119. (footnote original) See
Appellate Body Report on Japan — Alcoholic Beverages, pp.
19–23, for the rejection of the so-called “aims-and-effects” test
in the context of the national treatment clause of Article
III of GATT 1994. See also the Appellate
Body Report on EC — Bananas III, paras. 241, 243, 246, for
the rejection of the “aims-and-effects” test in the context of the
national treatment clause of Article
XVII of GATS. back to text
120. Panel
Report, US — Section 110(5) Copyright Act, para. 6.111. back to text
121. Panel
Report, US — Section 110(5) Copyright Act, para. 6.113. back to text
122. Panel
Report, US — Section 110(5) Copyright Act, para. 6.165. back to text
123. (footnote original) In the
context of exceptions to reproduction rights under Article
9(2) of the Berne Convention (1971) — whose second condition is
worded largely identically to the second condition of Article
13 of the TRIPS Agreement — the Main Committee I of the Stockholm
Diplomatic Conference (1967) stated:
“If it is considered that reproduction
conflicts with the normal exploitation of the work, reproduction is not
permitted at all. If it is considered that reproduction does not
conflict with the normal exploitation of the work, the next step would
be to consider whether it does not unreasonably prejudice the legitimate
interests of the author. Only if such is not the case would it be
possible in certain special cases to introduce a compulsory licence, or
to provide for use without payment. A practical example may be
photocopying for various purposes. If it consists of producing a very
large number of copies, it may not be permitted, as it conflicts with a
normal exploitation of the work. If it implies a rather large number of
copies for use in industrial undertakings, it may not unreasonably
prejudice the legitimate interests of the author, provided that,
according to national legislation, an equitable remuneration is paid. If
a small number of copies is made, photocopying may be permitted without
payment, particularly for individual or scientific use.”
See the Records of the Intellectual
Property Conference of Stockholm, 11 June — 14 July 1967. Report on
the Work of the Main Committee I (Substantive Provisions of the Berne
Convention: Articles 1–20.
As reproduced in the Berne Convention Centenary, p. 197. back to text
124. Panel
Report, US — Section 110(5) Copyright Act, paras.
6.166–6.167. back to text
125. Panel
Report, US — Section 110(5) Copyright Act, para. 6.173. back to text
126. Panel
Report, US — Section 110(5) Copyright Act, paras. 6.178 and
6.180. back to text
127. Panel
Report, US — Section 110(5) Copyright Act, paras.
6.183–6.184 and 6.187–6.188. back to text
128. Panel
Report, US — Section 110(5) Copyright Act, para. 6.222. back to text
129. Panel
Report, US — Section 110(5) Copyright Act, paras.
6.223–6.225. back to text
130. Panel
Report, US — Section 110(5) Copyright Act, paras.
6.226–6.229. back to text
131. Panel
Report, US — Section 110(5) Copyright Act, para. 6.235. back to text
132. Panel
Report, US — Section 110(5) Copyright Act, paras. 6.236 and
6.249. back to text
133. Appellate
Body Report, US — Section 211 Appropriations Act, paras.
156 and 165. back to text
134. Appellate
Body Report, US — Section 211 Appropriations Act, paras.
171, 177 and 178. back to text
135. Appellate
Body Report, US — Section 211 Appropriations Act, paras.
186, 187 and 195. back to text
136. Panel
Reports, EC — Trademarks and Geographical Indications (US),
paras. 7.601–7.603, and (Australia),
paras. 7.601–7.603. back to text
137. Panel
Reports, EC — Trademarks and Geographical Indications (US),
footnote 558 to para. 7.611 and (Australia),
footnote 564 to para. 7.611. back to text
138. Panel
Report, EC — Trademarks and Geographical Indications (Australia),
paras. 7.699–7.700. back to text
139. Panel
Report, EC — Trademarks and Geographical Indications (Australia),
para. 7.691. back to text
140. Appellate
Body Report, US — Section 211 Appropriations Act, para.
199. back to text
141. Panel
Report, Canada — Pharmaceutical Patents, para. 7.30. back to text
142. Panel
Reports, EC — Trademarks and Geographical Indications (US),
paras. 7.650–7.651, and (Australia),
paras. 7.650–7.651. back to text
143. Panel
Reports, EC — Trademarks and Geographical Indications (US),
paras. 7.659–7.660, and (Australia),
paras. 7.659–7.660. back to text
144. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.654, and (Australia),
para. 7.654. back to text
145. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.662, and (Australia),
para. 7.662. back to text
146. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.664, and (Australia),
para. 7.664. back to text
147. Panel
Reports, EC — Trademarks and Geographical Indications (US),
paras. 7.670–7.671, and (Australia),
paras. 7.670–7.671. back to text
148. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.676, and (Australia),
para. 7.675. back to text
149. Panel
Reports, EC — Trademarks and Geographical Indications (US),
paras. 7.681–7.682, and (Australia),
paras. 7.679–7.680. back to text
150. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.645, and (Australia),
para. 7.645. However, the Panel made some observations about this
approach in a footnote to these paragraphs ((US), footnote 578 to
para. 7.645 and (Australia),
footnote 583 to para. 7.645. back to text
151. Panel
Reports, EC — Trademarks and Geographical Indications (US),
para. 7.649, and (Australia),
para. 7.649. back to text
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