Ambassador Alfredo Suescum (Panama)

États-Unis d'Amérique

6 REVIEW UNDER PARAGRAPH 8 OF THE DECISION ON THE IMPLEMENTATION OF PARAGRAPH 6 OF THE DOHA DECLARATION ON THE TRIPS AGREEMENT AND PUBLIC HEALTH

67. The United States strongly supports the Paragraph 6 System as established under the 2003 waiver decision and the 2005 Protocol. 68. We encourage other Members to notify their acceptance of the amendment so that it can enter into force. I congratulate Montenegro, Chile, Chinese Taipei, Saudi Arabia, and Togo as the most recent Members to accept the amendment. 69. We want to take this opportunity as part of today's review of the implementation of paragraph 6 of the Doha Declaration on the TRIPS Agreement and Public Health to provide some context. As we have noted previously, the Paragraph 6 System is one of many tools to address the issue of access to medicines. There are other tools to address this important issue, which also merit discussion. As we will describe in greater detail under a separate agenda item, there are numerous barriers to access that deserve greater attention in this Council. These include both financial and non-financial barriers such as: insufficient legal and regulatory frameworks; insufficient enforcement; financial disincentives; high cost of capital and red tape. Today we would like to focus on tariffs. 70. Tariffs are applied to medicines, to the components of those medicines, such as active ingredients, and medical products. Tariffs imposed by governments are, however, borne by consumers, and more specifically, by patients. As we explained in November 2012, in recognition of this reality, during the Uruguay Round, the United States joined several other Members in eliminating tariffs on medicines and active ingredients in order to liberalize trade, lower costs, and increase access to these essential products. Since then, the participants in the pharmaceutical zero-for-zero agreement have updated it four times in order to include additional inputs for medicines, thereby reducing costs of production for medicines. However, some countries continue to impose relatively high tariffs on medicines, inputs to medicines and medical products. As we have previously noted, according to an October 18, 2012 staff working paper, published by the WTO Economic Research and Statistics Division, entitled "More Trade for Better Health, International Trade and Tariffs on Health Products" (ERSD-2012-17), several countries continue to maintain relatively high tariff rates on these products, despite a general trend toward tariff reduction on these goods. 71. The report concludes by asking "why countries even maintain tariffs on health products. Imposing tariffs typically translates into higher product prices, especially in the presence of long supply changes. Maintaining tariffs ultimately means taxing the sick and creating additional costs for the health system." Today, we would welcome more insight from those countries identified in the WTO report who continue to maintain the highest tariffs on medicines about the consistency of such policies with their commitment to greater access to medicines.

The Council so agreed.

6.1. The Chairman suggested that, in light of the consultations he had held on the preparations for the tenth annual review under paragraph 8 of the Decision on the Implementation of Paragraph 6 of the Doha Declaration on the TRIPS Agreement and Public Health, the Council follow the standard format in the present review. Accordingly, after introducing the item and any relevant recent developments, the floor would be opened to delegations for comments. This was how the Council had conducted most of the reviews, including the previous review, although in 2010 and 2011, the Council had had in place more elaborated procedures that had been agreed in advance, including a set of topics and questions to guide the discussion.

6.2. He said that the records of earlier reviews, including the exchange of questions and responses, continued to provide a unique and valuable resource for understanding this important measure and could also inform discussions at the present review. He had therefore encouraged delegations to consult this material, recorded in the minutes of previous reviews, and consider whether there was any issues they would wish to follow up.

6.3. As regards the purpose of the review, he recalled that paragraph 8 of the waiver Decision provided that the Council for TRIPS would annually review the functioning of the System set out in the Decision with a view to ensuring its effective operation and annually report on its operation to the General Council. Such a review would be deemed to fulfil the review requirements of Article IX:4 of the WTO Agreement.

6.4. The Secretariat had circulated a draft cover note for the Council's report modelled on previous years' reports (JOB/IP/9). It contained factual information on the implementation and use of the System established under the Decision and on the status of acceptances of the Protocol Amending the TRIPS Agreement. In accordance with the way that the Council had prepared its report in previous years, the part of the minutes of the meeting that reflected the discussions held under the agenda item could be attached to the cover note.

6.5. Paragraph 8 of the cover note contained a list of Members that had notified their acceptance of the Protocol. The Chairman said that Chile and Montenegro, on 26 July and 9 September 2013 respectively, had deposited their instruments of acceptance since the Council's last meeting in June. In addition, since the circulation of the draft report, Trinidad and Tobago had also accepted the Protocol (WT/Let/894). Paragraph 8 would need to be updated accordingly.

6.6. The Chairman clarified a frequently asked question on how the acceptance of the Protocol related to the implementation of the Paragraph 6 System in a Member’s domestic legal framework. He said that these were two entirely separate acts, in other words, the Protocol could be accepted independently from adopting domestic implementing legislation. By accepting the Protocol, a Member in essence expressed its consent that other WTO Members were entitled to use the additional flexibility that the System provided. Should a WTO Member wish to take advantage itself of those additional flexibilities, the adoption of appropriate domestic legislative measures could be required. He emphasized that, since these two processes were entirely separate, a Member could choose to deposit an instrument of acceptance of the Protocol without the need to wait for any domestic implementation. In fact, a number of instruments of acceptance that the WTO had received had been deposited before the Member in question had adopted any domestic implementing legislation.

6.7. The representatives of the United States, India, Canada, China, Australia, Japan, the European Union, Cuba, Switzerland, Chile and El Salvador, as well as of the WTO Secretariat and the WIPO Secretariat took the floor under this agenda item. The statements will be reproduced in an addendum to the present record.

6.8. The Council took note of the statements made.

6.9. Turning to the report to the General Council on the annual review of the Paragraph 6 System, the Chairman said that the Secretariat had circulated a draft cover note for the Council's report modelled on previous years' reports (JOB/IP/9). It contained factual information on the implementation and use of the System established under the Decision and on the status of acceptances of the Protocol Amending the TRIPS Agreement. In accordance with the way that the Council had prepared its reports in the previous years, the part of the minutes of the meeting that reflected the discussions held under the agenda item could be attached to the cover note.

6.10. As regards paragraph 8 of the cover note to the report, he recalled that Trinidad and Tobago had also recently accepted the Protocol. This paragraph would be updated accordingly.

6.11. The Protocol had originally been open for acceptance by Members until 1 December 2007. Upon proposals by the TRIPS Council, the General Council had three times extended that period for further two-year periods. The period for acceptance was currently due to expire on 31 December 2013. Given the proximity of this date, the Chairman suggested that the Council consider again submitting a proposal to the General Council for a decision to extend the period for the acceptance of the Protocol. For that purpose, a draft decision that could be submitted to the General Council for adoption was included in Annex 2 to the draft report. It did not yet contain a new deadline for the extended period for acceptances. In the light of the consultations he had held on this matter, he suggested that the Council propose to extend the period by a further two years until 31 December 2015.

6.12. The Chairman proposed that the Council agree on forwarding to the General Council the proposal for a decision to extend the period of acceptance by Members of the Protocol Amending the TRIPS Agreement until 31 December 2015. He suggested that the last paragraph of the draft decision by the General Council contained in Annex 2 to the draft report be complemented by inserting this date. He also proposed that the Council agree on the cover note to the report contained in JOB/IP/9, with the update to paragraph 8 concerning Trinidad and Tobago, and also that the Council minutes containing the record of the discussion be attached to it.

6.13. The Council so agreed.

IP/C/M/74, IP/C/M/74/Add.1