rahul kumar and hapreet singh

8/13/2019 Rahul Kumar and Hapreet Singh

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Presentation

RAHULKUMAR

HARPREET SING

12PU and 34 DBU

M.B.A Ist


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WORLD TRADE ORGANISATION

WTO (the successor to the GeneralAgreement on Tariffs and Trade - GATT -established in 1948), came into being onJanuary 1,1995.

is the only international organisationdealing with the rules of trade betweennations.

The goalis to help producers of goods andservices, exporters, and importers conducttheir business fairly.


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GATT GATT, the predecessor of WTO was born in 1948 as

a result of the international desire to liberalise trade.

History: One of the 3 instns recommended by theBretton Woods Conference of 1944

IMF and World Bank. set up in 1946,

but the 3rdITO(International Trade Organisation)could not be set up:

--because of objections that its provisions wouldinterfere with the autonomy of domestic policy making.

So, the ITO charter was never ratified. Instead the GATT, which had been drawn up only as an

interim agreement to fill the gap, became theframework for international trading system since 1948.


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The GATT was transformed into a World Trade Organisation

(WTO) with effect from January, 1995. (after about five

decades.)

India is a founder member of the IMF, World Bank, GATTand the WTO.

Evaluation of GATT

The growing number of the signatories of GATT & WTO show itspopularity. In 1947, only 23 nations were party to it. By the time

of Uruguay Round there were 117 and in July 1995, there were

128 signatories. Wef 1-1-2002 China rejoined WTO

In the earlier rounds:only tariff reductions discussed but later alsoother areas such as anti-dumping and NTBs.

In the Uruguay Round(1986-1994) :with the creation of WTO also

Trade in Services, TRIPS, TRIMS.


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WORLD TRADE ORGANISATION

Following the UR Agreement, GATT was

converted from a provisional agreement intoa formal international organisation called

WTOw.e.f. 1-1-1995.

The membership of the WTO increased from128 in July 1995 to 148 countries at the

beginning of 2005 and about two dozen nations

more were negotiating membership. The WTO members now account for over 97

per cent of the international trade.


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Functions

The WTOs overriding objective is to help trade flow

smoothly, freely, fairly and predictably.

It does this by:

1. Administering the WTO trade agreements.

2. Providing the forum for negotiations among its

members concerning their multilateral trade relations3. Administering the mechanism for settling trade disputes

between the member countries.

4. Monitoring national trade policies.

5. Providing technical assistance and trainingfordeveloping countries.

6. Cooperating with other international organizationslike

the IMF and IBRD and its affiliated agencies to achieve

greater coherence in global economic policy making.


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2. Services: Banks, insurance firms, telecommunications cos.,tour operators, hotel chains and transport companies looking to

do business abroad can now enjoy the same principles of freer

and fairer trade that originally only applied to trade in goods. These principles appear in the new General Agreement on

Trade in Services (GATS).WTO members have also made

individual commitments under GATS stating which of their

services sectors they are willing to open to foreign

competition, and how open those markets are.

3. Intellectual Property: The WTOs intellectualproperty agreement amounts to rules for trade and investment

in ideas and creativity. The rules state how copyrights, patents,trademarks, geographical names used to identify products,

industrial designs, i.c.s, layout-designs and undisclosed

information such as trade secretsintellectual property

should be protected when trade is involved.


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4. Dispute Settlement: Countries bring disputes tothe WTO if they think their rights under the agreements

are being infringed.

The system encourages countries to settle theirdifferences through consultation.Failing that, they

can follow a carefully mapped out, stage-by-stage

procedure that includes the possibility of a ruling by a

panel of experts, and the chance to appeal the ruling on

legal grounds.

Confidence in the system is borne out by the number of

cases brought to the WTOalmost 250 cases in sevenyears compared to some 300 disputes dealt with during

the entire life of GATT (194794).


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5. Policy Review: The Trade Policy ReviewMechanisms purpose is to improve transparency, to

create a greater understanding of the policies that

countries are adopting, and to assess their impact. All

members must undergo periodic scrutiny.

6. Development and Trade

Over three quarters of WTO members are developingor LDCs. All WTO agreements contain special

provision for them,including longer time periods to

implement agreements and commitments, measures to

increase their trading opportunities and support to help

them build the infrastructure for WTO work, handle

disputes, and implement technical standards.


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7. Technical Assistance and Training

The WTO organizes around 100 technical

cooperation missionsto developing countriesannually. It holds on an average three trade policy

courseseach year in Geneva for government

officials. Regional seminarsare held regularly in

all regions of the world with a special emphasis on

African countries.

Training courses are also organized in Geneva for

officials from countries in transition from centralplanning to market economies.


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TRIMs

Trade Related Investment Measures(TRIMs)refers to certain conditions or restrictionsimposed by a government in respect of foreign

investment in the country.

TRIMs were widely employed by developingcountries.

The Agreement on TRIMs provides that nocontracting party shall apply any TRIMwhich is inconsistent with the WTO Articles.


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TRIPs (Trade Related Aspects of Intellectual

Property Rights)

Intellectual property rights may be definedas

information with commercial value.

IPRs have been characterisedas a composite of ideas,inventions and creative expression plus the public

willingness to bestow the status of property on them and

give their owners the right to exclude others from access

to or use of protected subject matter.


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According to the WTO,intellectual property

rights are the rights given to persons over the

creations of their minds. They usually give

the creator an exclusive rightover the use of

his/her creation for a certain period of time.

IPRs includepatents, trademarks,

copyrights, geographic indications,

undisclosed information (such as trade secrets),industrial designs, and layout designs of

integrated circuits, and plant variety

protection.


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Objectives of Protection of Intellectual Property

Encourage and reward creative work

Technological innovation

incentive and means to finance R&D activities.

Fair competitionThe protection of distinctive signs and other

IPRs aims to stimulate and ensure fair competition among

producers.

Consumer protection

by enabling them to make informed choices

Transfer of technologyfacilitated in the form of foreign direct

investment, joint ventures and licensing. Balance of rights and obligations The exclusive rights given

are generally subject to a number of limitations and exceptions,

aimed at fine-tuningthe balance that has to be found between the

legitimate interests of right holders and of users.


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IPRS AND DEVELOPING COUNTRIES

Although the IPRs are intended to encourage R&D, they often

provide an opportunity for the developed country firms an

opportunity to exploitthe developing countries.

Disadvantages/Limitations

The developing countries, particularly the very poor among

them, are ill equippedfor significant R&D. In a world order

where developing countries heavily depend on imports oftechnology, IPRs turn out to be more beneficial to industrial

countries than to developing countries.

A strong IPRs regime without adequate safeguards to protect

interests of weaker sectionscan create very serious problems indeveloping countries, e.g.exorbitant prices.

Developing countries, generally, dont have adequate

institutional mechanism and resources to properly

administer IPRs regime.


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Benefits

Protection of IPRs is not without gains to DCs .

Stronger IPR protection may encourage investment,both foreign and domestic.

Stronger IPR protection could be expected to give a boost to

R&Din countries like India whose potential intellectual capital

may be expected to grow in great width and in depth.

IPR systems provides a great opportunity to developing

countries to benefit from protection of indigenous

property rights and traditional knowledge.

Developing countries hold approximately 90 %of world

biological resources, which are particularly important in the

development of new pharmaceuticals.


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PATENTSA patent is a legal protectiongranted for an invention

that is new, non-obvious and useful.

The patent grants the patent holder the exclusive rightto make use or sell the patented products or process.

Patents, by providing an opportunity to recoup the costof invention and to make profit out of the invention,

encourage R&D.An invention, to be patentable, must satisfy the

following three conditions :

It is new.

It is useful to the society. It is non-obvious to a person possessed of average

skill.


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Exclusion of an invention from patentabilityfor

commercial exploitation is permitted if it is necessary to

protect public order or morality, including to protect

human, animal or plant life or health or to avoid serious

prejudice to the environment.

A nation may also exclude from patentability(a)

diagnostic, therapeutic and surgical methods for thetreatment of humans or animals; (b)plants and animals

other than micro organisms and essentially biological

process for the production of plants or animals other than

non-biological and micro-biological process.


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Indian Patent Law and the UR Agreement

The UR Agreement on patents is in substantial variance with the

Indian Patent Act of 1970.

Under the Indian Patent Act, 1970, only process patent(and noproduct patent) is applicable in respect of inventions relating to

substances intended for use as food, drug or medicines, or

substances produced by chemical processes is limited to the

methods or processes of manufacture only. This means that one can make and market a product similar to the

patented product through a different process or methodthan

the patented one. This practice has been very prevalent in the

Indian pharmaceutical industry. The UR Agreement requires both product and process patents.

Under the 1970 Act, patent expiry period is 5 to 7 years for some

products and 14 years for other products, whereas the UR

Agreement stipulates 20 yearsfor all products.


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Anti-dumping measures can be employed only if

dumped imports are shown to cause serious damage

to the domestic industry in the importing country.

Further, antidumping measures are not allowed if the

margin of dumping(i.e., the price differences) is de

minimis(defined as 2 percent of the export price of the

product) or the volume of dumped imports is negligible(less than 3 per cent of imports of the product in

question).

E.g.:Dumping occurswhen the price at which the goods

are exported to India is lower than their normal value.The difference between this export price and the normal-

value is known as the margin of dumping. It is generally

expressed as a percentage of the export price.


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THE DOHA DECLARATION

The fourth ministerial meeting of the WTO was held

in Doha in November 2001 in which Ministers fromthe 142 member countries participated.

The ministerial had attracted a lot of attention

because of the conflict of interests of the developed

and developing countries.

The developed countries wanted a new roundof

multilateral trade negotiation to be launched soon,

covering what are known as the Singapore Issues(alist of7 itemswhich were proposed at the meeting in

Singapore in 1996 for future negotiations.


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Developing countries like Indiaon the other hand held

that the Implementation Issues should be resolved

before a new Round. India had to almost single handedly

fight.

The Doha meet concluded by drawing up the Doha

Development Agendafor new trade liberalisation talks;

with India approving the ministerial declaration onlyafter it was satisfied that the conference had addressed

the countrys concerns in the four Singapore issuesof

foreign investment, competition policies, transparency in

government procurement and trade facilitation. Although , the developed nations, won the upper

hand, Indias bold stand has had a commendable

impact.


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WTO AND INDIA

The Uruguay Round Agreements and WTO

have come in for scathing criticismsin India.

Many politicians and others have argued thatIndia should withdrawfrom the WTO.

Many of the criticisms are either baseless or dueto lack of knowledge of the international tradingenvironment, and misinformation, or are justmeant to oppose the government by theopposition parties.


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It is true that the Uruguay Round mostly

benefits the developed countries.(Participationgap).

That does not mean that developingcountries like India are losing

their gain is limited as compared to that of thedeveloped countries.

also liberalization by developed countries is

needed for the developing countries to takeadvantage of globalisation.


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Accepting the demand of some of the critics, that

India should withdraw from the WTO will be a

great blunder.

By being a part of WTO India enjoys the most

favoured nation (MFN) status with all the other

members of the WTO.

Opting out of the systemwould mean an infinitelylaborious task of entering into bilateral negotiations

with each and every one of the trading partners which

would amount to having ones arms twisted

bilaterally by the US, the EC and Japan, turn byturn, on everything from intellectual property rights

to NPT, human rights and environmentally clean

technologies for packaging.


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One major controversy pertains to the

agricultural subsidies.

Much hue and cry

However, it needs to be mentioned that the

Agreement would not adversely affect Indias

agricultural subsidies and its agriculture exports. However Indias gain will be much less than those of

several other developing countries like China and the

newly industrialised economiesbecause :(i) Indias

share in the world trade is very low(ii) The foreign trade-GDP ratio of India is low. The gain will also depend on the

rate of growth of Indias exports.


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India has taken several measures to comply with the

TRIPs Agreement.

For the protection of Geographical Indications ofGoods, a sui generis legislation, viz., the

Geographical Indications of Goods (Registration &

Protection) Act, 1999has been enacted in order to

comply with the requirements under the TRIPS and toprotect products of Indian origin as well.

The Act primarily intends to protect the valuable

geographical indications of our country. The

protection under the Act is available only to the

geographical indication registered under the Act and to

the authorized users.


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Various suggestions have been advanced in India to

extend protection to knowledge, innovations and

practices.

These include: (i) documentation of Traditional

Knowledge (TK);

(ii) registration and innovation patent system; and (iii)

development of a sui generis system. Proper documentation of associated TK could help in

checking bio-piracy.

Documentation could be a double-edged sword.It is assumed that if the material/knowledge is documented, itcan be made available to patent examiners the world over.

But..

rahul kumar and hapreet singh

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