Brazil and India are both upset over the interception (and return) by Dutch authorities of generic pharmaceuticals exported from India’s Dr. Reddy’s on route to Brazil. See here for one newspaper article. The article states:
Commerce secretary G.K. Pillai said the department has taken up the matter with the European Commission (EC) and has written to them. “This is an act of piracy by the European Union. The consignment was going to Latin America and was seized in Europe... This is a dangerous thing happening, which is totally uncalled for. It is part of the strategy by these countries to target generic drugs from India.”
Frequent IEL and Policy blogger Shamnad Bashir is quoted in the article as saying:
“If the consignment does infringe a patent, then you cannot question the EU for seizing it under their patent laws.”
This seems to be correct. EC Customs and Regulation 1383/2003) mandates Members to detain suspicious goods. The Regulation provides the authorities right to suspend goods to be released for circulation within the EU, goods for export or re-export and goods in free zones or warehouses during transit through the EU. It seems that Cross Co v Sunil in the US (under the Lanham Act) and even the Indian Supreme Court decision of Gramophone Company Of India Ltd. vs Birendra Bahadur Pandey & Ors. allow similar action.
The relevant articles in TRIPS are 51-60 (dealing with border enforcement measures). Footnote 13 of TRIPS implies that countries can, but do not have to, apply the enforcement measure to transiting goods. In this regard, I don't see a conflict between the EC regulations and TRIPS.
Unsurprisingly, MSF have a different view:
"The EC regulations that have led to the seizure of Indian generic drugs in transit to Brazil have created barriers to the export of affordable, quality, low-cost generic drugs from India to other developing countries. This is part of the IP (intellectual property) enforcement agenda,” said lawyer Leena Menghaney, who is also India project manager for the Campaign for Access to Essential Medicines, an initiative of Medecins Sans Frontieres, a non-profit organization".
Despite the fact that a compulsory licence wasn’t issued for the relevant drugs at issue, the Brazilian government is considering a WTO complaint:
"The Brazilian government feels that the decision by the Dutch authorities to detain the basic material critical for the public health of a developing country ... a serious step backward on the question of universal access to drugs," said the note released by the Brazilian ministries late Thursday.
The statement also said the government would take its complaint to the executive council of the World Trade Organization in Geneva.
The relevant provisions of TRIPS seem to substantiate the actions of the EC, but does a strict interpretation in this instance frustrate the object and purpose of TRIPS? Moreover, is Article V of GATT ('freedom of transit') implicated?
Note: A big assist goes to R.V. Anuradha for the email discussion as well as suggesting this post and some of the contents therein.
