Asia IP

On October 6, 2015, one of the most significant regional trade deals, the Trans-Pacific Partnership (TPP) trade agreement, was successfully concluded. TPP aims at bringing higher trade standards to the nearly 40% of the global economy living in Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam.

While TPP mostly focuses on trade issues, there is an important IP chapter, say lawyers at Baker & McKenzie.

The details of the IP chapter itself has not been disclosed, and it appears that there is still drafting work in progress. “The TPP minister’s statement and summary did not specifically mention when any of the TPP chapters would be disclosed. The statement merely shows that the negotiators will continue to prepare a complete text for public release. This will include legal review, translation, drafting and verification of text. It seems to imply that the IP chapter, along with the other chapters, will not be disclosed particularly soon,” says Kensaku Takase, head of Baker & McKenzie’s intellectual property and information technology (IP/IT) group in Tokyo. “In addition, the IP chapter covers issues which were quite controversial such as the patent term extension issue. It is possible that the drafting of such provisions may take some time. It would be a pleasant surprise if the IP chapter is disclosed this year, but early next year would seem more realistic.”

In the meantime, a summary of the key features has been published. Based on the summary:

The IP chapter will cover patents, trademarks, copyright, industrial designs, geographical indications, trade secrets, other forms of IP and enforcement of IPRs. “These may be the issues which are likely to be covered by the IP chapter, different forms of protection for innovative drugs remains one of the more controversial topics,” says Takase.

In fact, one of the most heavilynegotiated areas of the IP chapter relates to pharmaceuticals and the duration of their protection. However, the summary itself does not go into any detail other than to say that the related provisions “facilitate both the development of innovative, life-saving medicines and the availability of generic medicines, taking into account the time that various [TPP] Parties may need to meet these standards.” According to news sources, the specific topics to be covered will include (i) patent term extension for drugs and medical devices, (ii) establishment of data protection rules for new drugs, and (iii) a patent linkage system.

“There is uncertainty as to what extent TPP will cover these three points. Information provided so far has focused on data exclusivity periods for biologics, which is separate from patent protection and ranges from zero to 12 years across the TPP countries. It has been reported that agreement was reached for a minimum data exclusivity protection term for biologic product of five years, ‘plus other government measures that can achieve a comparable outcome,’ as described by US Trade Representative Ambassador Froman,” says Toby Patten, a Melbourne-based special counsel in the healthcare group at Baker & McKenzie. “He and Minister Andrew Robb of Australia agreed that the parties, in the end, did not need to come to a consensus to create a single, hybrid system or procedure applicable to each of the diverse economies. Rather they needed only to agree on a common element, or elements (here the five-year minimum period), allowing individual governments to determine the best procedures to achieve innovation and access to medicines.”

For copyright, the IP chapter will require protection for “works, performances, and phonograms such as songs, movies, books, and software, and includes effective and balanced provisions on technological protection measures and rights management information.” These will need to be balanced with systems such as exceptions and limitations for legitimate purposes. It is expected that, based on TPP, its parties should make the term of protection for copyrighted works effective for at least 70 years from the death of the author (for copyright works made by individuals).

Takase says that the TPP parties should make the term of protection for copyrighted works effective for at least 70 years from the death of the author (for copyright works made by individuals) because “from a practical perspective, having the term for copyright protection consistent amongst the parties is certainly better than having them inconsistent.”

A “framework of copyright safe harbours” for internet service providers will also need to be established, wherein the safe harbours would not be contingent on ISPs monitoring for infringing activity.

On the enforcement side, the TPP will likely provide a focus on protection of trade secrets through criminal procedures and penalties. In addition, there will be requirements to provide strong enforcement systems generally.

“Hopefully this will lead to a more harmonized approach to enforcement amongst the TPP countries. Currently enforcement measures relating to IP vary significantly. The summary talks of strong enforcement systems include, for example, civil procedures, provisional measures, border measures, criminal procedures and penalties for commercial-scale trademark counterfeiting and copyright or related rights piracy,” Takase says. “Taking border measures as an example, we would expect more consistency relating to seizure periods for suspected counterfeit goods, and give authority to local customs to properly dispose or destroy goods which are confirmed to be counterfeit.”

Even after the IP chapter is published, the changes will need to be ratified in each TPP party jurisdiction. This is likely to take some years, depending upon the area of law.

“Ratification periods will differ from country to country and may also differ depending upon the issues within the IP chapter,” Takase says. “Some countries have laws which may already be largely in line with the IP chapter – such countries may therefore be able to ratify most of the IP chapter within one to two years. Other countries may require more substantial changes to their laws, which may take more time to ratify.”