Since TRIPS came into force, it has been subject to criticism from
developing countries,
academics, and
non-governmental organizations. Though some of this criticism is against the WTO generally, many advocates of trade liberalisation also regard TRIPS as poor policy. TRIPS's wealth concentration effects (moving money from people in developing countries to copyright and patent owners in developed countries), and its imposition of
artificial scarcity on the citizens of countries that would otherwise have had much fairer intellectual property laws, are common bases for such criticisms. Other criticism has focused on the failure of TRIPS to accelerate investment and technology flows to low-income countries, a benefit advanced by WTO members in the lead-up to the agreement's formation. Statements by the World Bank indicate that TRIPS has not led to a demonstrable acceleration of investment to low-income countries, though it may have done so for middle-income countries.
Daniele Archibugi and Andrea Filippetti have argued that the main motive for TRIPS was a decline in the competitiveness of the technology industry in the United States, Japan, and the European Union against
emerging markets, which it largely failed to abate. They instead argue that the main supporters and beneficiaries of TRIPS were IP-intensive multinational corporations in these countries, and that TRIPS enabled them to
outsource key operations to emerging markets. Archibugi and Filippetti also argue that the importance of TRIPS, and intellectual property in general, in the process of generation and diffusion of knowledge and innovation has been overestimated by its supporters. Analysis of OECD countries in the 1980s and 1990s (during which the patent life of drugs was extended by six years) showed that while total number of products registered increased slightly, the mean innovation index remained unchanged. In contrast to that,
Jörg Baten, Nicola Bianchi and
Petra Moser (2017) find historical evidence that under certain circumstances compulsory licensing – a key mechanism to weaken intellectual property rights that is covered by Article 31 of the TRIPS – may indeed be effective in promoting invention by increasing the threat of competition in fields with low pre-existing levels of competition. They argue, however, that the benefits from weakening intellectual property rights strongly depend on whether the governments can credibly commit to using it only in exceptional cases of emergencies since firms may invest less in R&D if they expect repeated episodes of compulsory licensing. TRIPS-plus conditions mandating standards beyond TRIPS have also been the subject of scrutiny. These
FTA agreements contain conditions that limit the ability of governments to introduce competition for generic producers. In particular, the United States has been criticised for advancing protection well beyond the standards mandated by TRIPS. The United States Free Trade Agreements with Australia, Morocco and Bahrain have extended patentability by requiring patents be available for new uses of known products. The TRIPS agreement allows the grant of compulsory licenses at a nation's discretion. TRIPS-plus conditions in the United States' FTAs with Australia, Jordan, Singapore and Vietnam have restricted the application of compulsory licenses to emergency situations, antitrust remedies, and cases of public non-commercial use. In 2001, at the Fourth Ministerial Conference in Doha, several
World Trade Organization (WTO) members proposed changes to Articles 27 and 31 of the
TRIPS Agreement, aiming to strike a balance between patent protection for pharmaceuticals and the impact of such protection on drug prices. This initiative led to the
Doha Declaration, which reaffirmed the sovereign right of WTO members to grant compulsory licenses for pharmaceuticals. The Declaration also acknowledged the struggles faced by countries with limited pharmaceutical manufacturing capabilities in utilizing compulsory licensing under TRIPS, signaling perceived limitations within the original TRIPS framework. Following two years of intense negotiations, the TRIPS Council responded by implementing the Waiver Decision in 2003, which temporarily allowed WTO members to grant compulsory licenses free from the restrictions of TRIPS Articles 31(f) and 31(h). The principles of this decision were later codified into TRIPS through the Amendment Protocol of 2005, which introduced Article 31bis, effectively becoming law in 2017 post-ratification by two-thirds of WTO members.
Article 31bis allows a WTO member with insufficient or no manufacturing capacities in the pharmaceutical sector (the "Importing State") to import patented pharmaceutical products produced under a special export
compulsory license granted by another WTO member (the "Exporting State"). It is structured as a dialogical interaction between an Importing State and an Exporting State and has specific procedural requirements. The Exporting State can issue an export compulsory license exempt from Article 31(f) restrictions, but the license must comply with several specific terms. Developed WTO members can opt-out from being Importing States, but the COVID-19 pandemic revealed the potential shortfalls of this decision as several developed countries struggled with inadequate vaccine production capabilities. In 2003, the US Bush administration changed its position, concluding that generic treatments might in fact be a component of an effective strategy to combat HIV. Bush created the
PEPFAR program, which received $15 billion from 2003 to 2007, and was reauthorized in 2008 for $48 billion over the next five years. Despite wavering on the issue of compulsory licensing, PEPFAR began to distribute generic drugs in 2004–05. In 2020, conflicts re-emerged over patents, copyrights and trade secrets related to
COVID-19 vaccines, diagnostics and treatments.
South Africa and
India proposed that WTO grant a temporary waiver to enable more widespread production of the vaccines, since suppressing the virus as quickly as possible benefits the entire world. The waivers would be in addition to the existing, but cumbersome, flexibilities in TRIPS allowing countries to impose compulsory licenses. Over 100 developing nations supported the waiver but it was blocked by the G7 members. This blocking was condemned by 400 organizations including
Doctors Without Borders and 115 members of the
European Parliament. In June 2022, after extensive involvement of the
European Union, the WTO instead adopted a watered-down agreement that focuses only on vaccine patents, excludes high-income countries and China, and contains few provisions that are not covered by existing flexibilities.
Software and business method patents Another controversy has been over the TRIPS Article 27 requirements for patentability "in all fields of technology", and whether or not this necessitates the granting of
software and
business method patents. ==See also==