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Source: Small Island Developing States

As vaccines for COVID-19 begin to be administered in some countries, World Trade Organization (WTO) members are debating multiple avenues for supporting the accessibility and availability of vaccines and other essential medical products, with the options on the table presenting markedly different approaches.

These approaches include an earlier proposal by India and South Africa for a waiver from some of the WTO’s intellectual property rules to ensure greater availability of diagnostics, therapeutics, vaccines, and other medical products. Also on the table is a new proposal from the “Ottawa Group” – a coalition of countries that have met regularly to develop a series of proposed actions and ideas involving WTO reform – putting forward a series of “immediate actions,” which, it says, are aimed at protecting supply chains from further instability and making sure that access to essential medical goods is not further hampered.

Both proposals sparked intense discussion among WTO members at their final General Council meeting of 2020, which was extended for an extra day to make space for the many interventions by members on these and other topics. While neither proposal yielded consensus among the membership, the issues raised are expected to remain high on the agenda over the coming months.

Ottawa Group Pitches “Trade and Health Initiative”

The communication from the Ottawa Group calls for launching a new “Trade and Health Initiative.” The co-sponsors of the proposal include Australia, Brazil, Canada, Chile, the EU, Japan, Kenya, Mexico, New Zealand, Norway, Singapore, the Republic of Korea, and Switzerland.

An annex to the document sets out a series of “draft elements” for the initiative, including taking stock of “unnecessary existing restrictions on exports of essential medical goods” for the pandemic response, while taking steps to remove the restrictions that exist and avoid instating new ones where possible. Any new restrictions should be notified to the global trade club and limited, if possible, to three months.

The annex also sets out various considerations that should be kept in mind when assessing new or existing restrictions, such as ensuring that these do not hamper humanitarian efforts or complicate access to medical goods for developing and least developed countries (LDCs) that may have challenges manufacturing them locally.

The document also features a section on customs, services, and technical regulations, which calls for sharing experiences in the area of customs and best practices involving technical regulations. These efforts would be targeted at facilitating trade in essential medical goods and involve talks in various WTO bodies tasked with these issues.

Another ask by the Ottawa Group is for WTO members to slash tariffs on essential media goods, while “taking into account national circumstances.” The Group suggests the products covered could be chosen from a joint list developed by the World Health Organization (WHO) and the World Customs Organization (WCO).

Finally, the Group outlines proposed steps aimed at improving the monitoring of new and existing trade measures. A report outlining what has been done under the Initiative would be prepared by the WTO Secretariat for the next Ministerial Conference (MC12), now expected for December 2021.

“At the heart of this Initiative lies the belief that each Member should be free at domestic level to take the trade policy actions needed to fight the pandemic in accordance with the WTO framework. But we are convinced that in the interest of the common public good such actions should be coordinated and transparent,” said the EU, which presented the communication on the Ottawa Group’s behalf.

Another key component of the proposal is that these actions – while initially pandemic-linked – could turn into new, binding commitments among the WTO membership, with proponents referring to the next ministerial conference as an opportunity to take that decision.

Trade sources say the proposal received mixed responses during the meeting of the General Council, with strong reactions from some members on whether the proposed actions were tackling the right problems, or whether they were sufficiently developed. Among the detractors was the US, with Dennis Shea, the US’ Ambassador to the WTO, saying “it’s not clear what problem the cosponsors aim to solve nor how the proposed measures would solve that problem.”

Citing the continued public health challenges posed by the pandemic, as well as the concerns that have emerged over supply chain resilience, he said that Washington “question[s] the prudence of asking Members to put new constraints on their rights under the WTO Agreement – not to mention on their duty – to undertake measures to protect human health and life.”

Trade sources noted that the Ottawa Group’s proposal also received pushback from India and South Africa, though on different grounds. Both members said their proposal for a COVID-19 waiver would be a better approach, offering more concrete solutions to specific needs resulting from the pandemic, especially the affordability and accessibility of vaccines.

Some other delegations, such as Colombia and Turkey, reportedly welcomed the proposal, while others indicated they would need more time to consult with capitals.

COVID Waiver: Further Co-sponsors Sign on, Next Steps Unclear

The proposed “COVID-19 waiver” for several aspects of the WTO’s Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), meanwhile, has gained a series of co-sponsors since being introduced earlier this autumn. These include Bolivia, Eswatini, Kenya, Mongolia, Pakistan, and Venezuela. Several others have also lent their backing to the waiver, with trade sources indicating that over half of the WTO’s 164 members are now in support of the initiative.

“India may be having the required manufacturing capacity and the national legislations to cater to its needs. But we believe that in a global pandemic, where every country is affected, we need a global solution,” said Brajendra Navnit, India’s WTO Ambassador.

He also described the waiver as a “targeted and proportionate response to COVID-19, as it seeks waiver for a limited period from four specific sections of the TRIPS Agreement.” Navnit argued multilateral initiatives developed in other forums, like the Access to COVID-19 Tools (ACT) Accelerator led by the WHO and its vaccine-focused pillar, COVAX, which is co-convened with Gavi and the Coalition for Epidemic Preparedness Innovations (CEPI), were promising but insufficient for the challenges at hand.

South Africa, the other original co-sponsor, warned that the exceptional circumstances of the COVID-19 crisis meant that a rapid scale-up of vaccine production must be enabled. Notably, South Africa also asked that an extraordinary session of the General Council be convened to discuss the matter further in early 2021, before the General Council meets in February for its regular session.

Others, such as Egypt, noted that even if there is sufficient flexibility under the TRIPS Agreement, the time it takes to implement compulsory licensing on a country-by-country basis is too slow relative to the pace of this pandemic.

However, several members, including Australia, Canada, Japan, Singapore, the Republic of Korea, and Switzerland, said they would need to see further evidence that the existing flexibilities available under the TRIPS Agreement, as recognized under the 2001 Doha Declaration on TRIPS and Public Health, do not provide enough policy space for national governments. Some, like the EU, went further to say that sufficient flexibility indeed exists, but that there may be problems in implementing compulsory licensing in practice, in which case Brussels would be available to help.

Talks in the TRIPS Council are set to continue in early 2021, with reports then shared with the General Council. Whether the waiver obtains the backing of three-quarters of the membership, as required under the WTO Agreement, will be the issue to watch. Under Article IX of the WTO Agreement, the submission of a waiver request launches a 90-day window for attempting to gain consensus among the WTO membership, with the chair of the committee that received the waiver proposal then having to submit a report to the Ministerial Conference.

This 90-day period would have begun on 2 October, the date of the India-South Africa proposal, and would therefore end in early January. Without consensus, the decision can then be taken by that three-quarters majority. However, decisions by a sub-set of the WTO membership are virtually non-existent, given that the organization has historically operated by consensus.

The pandemic has brought trade and health back into the limelight at the WTO, where the issue is normally discussed only within the context of the TRIPS Council. Many of the concerns raised at the 16-18 December meeting of the General Council, however, build on long-standing areas of debate in the trade and health communities, with the positions raised often exposing familiar fault lines among the WTO membership. The discussions have made it clear that questions over the accessibility and availability of essential medical products, as well as the severe challenges that many countries face in manufacturing them, cannot languish in the background until a crisis hits.

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This policy brief was written by Sofía Baliño, Communications and Editorial Manager, Economic Law and Policy, IISD.

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