The Canada Seal panel report: Possible Impacts on IP Disputes?

by Daniel Gervais on Wednesday, November 27th at 6:59 PM

In a piece coauthored with Professor Susy Frankel, we examine the applicability of notions such as justifiability to diminutions of IP rights. The article argues that to interpret the scope of restrictions imposed by TRIPS, including article 20, on WTO member States, one should look beyond the text of each article and consider articles in context, with due regard for the object and purpose of the provision and of the Agreement.

In a panel report issued on the importation and marketing of seal products from Canada issued  on 25 November, 2013, and dealing in large part with the Agreement on Technical Barriers to Trade (TBT), a WTO dispute-settlement panel seems to agree with this approach, which also meshes well with previous panel and Appellate Body reports.

Some of the panel’s findings are illuminating. Here is a taste:

“[T]he object and purpose of the TBT Agreement to strike a balance between the objective of trade liberalization and Members’ right to regulate, the Appellate Body concluded that Article 2.1 should not be interpreted as prohibiting any detrimental impact on competitive opportunities for imports in cases where such detrimental impact on imports stems exclusively from a legitimate regulatory distinction.”

Turning to Article XX GATT, the panel noted this:

“The necessity of a measure within the meaning of Article XX(a) is determined through ‘a process of weighing and balancing’ of ‘all the relevant factors, particularly the extent of the contribution to the achievement of a measure’s objective and its trade restrictiveness, in the light of the importance of the interests or values at stake’. The more vital or important the values or interests furthered by a measure are, the easier it will be to accept that measure as necessary. According to the Appellate Body, ‘if this analysis yields a preliminary conclusion that the measure is necessary, this result must be confirmed by comparing the measure with its possible alternatives, which may be less trade restrictive while providing an equivalent contribution to the achievement of the objective pursued’.

In tackling the relationship between the TBT and GATT, the panel said this:

“Given the close relationship between the GATT 1994 and the TBT Agreement and the need to interpret relevant provisions under both Agreements in a consistent and harmonious manner, we consider that an analysis of a measure’s contribution to an objective under Article 2.2 of the TBT Agreement is also relevant to such analysis under Article XX of the GATT 1994. The Appellate Body in US – Tuna II (Mexico) recalled that in assessing the necessity of a measure under Article 2.2, a panel must assess the contribution to the legitimate objective actually achieved by the measure at issue as in other situations, such as for instance when determining the contribution of a measure to the achievement of a particular objective in the context of Article XX.”

The panel’s examination of whether the discrimination in the EU ban between commercial seal hunts and hunts by Inuit hunters is “justified” is similary interesting.  While some of that discussion may be used by Members in the TRIPS Art. 20 context, one should bear in mind that, as a substantive matter (that is, independently of burden of proof issues), an analysis of “arbitrary and unjustifable” under art. XX of GATT  is not necessarily the same as the justification required under art. 20 of TRIPS.

All of this also shows, it seems to me, that a civil discussion of applicable rules is possible–indeed desirable–even (or especially) where an important public policy matter is at stake .

 
 
 

Leave a Reply

Your email address will not be published. Required fields are marked *