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Anti-Counterfeiting Trade Agreement (ACTA)

ACTA and Issues Related to Pharmaceuticals and Counterfeit Medicines

Summary of Discussions

On June 30, 2009, Foreign Affairs and International Trade Canada (DFAIT) conducted a stakeholder consultation on the Anti-Counterfeiting Trade Agreement (ACTA), as it pertained to counterfeit and substandard medicines. The purpose of the consulation was to continue discussing the issues related to counterfeit and substandard medicines, which were raised at the previous consultation on April 6, 2009. A range of interested stakeholders were in attendance, including representatives from academia, industry, and non-governmental organizations. The roundtable was chaired by Canada’s ACTA chief negotiator Mr. Douglas George, Director, Intellectual Property, at DFAIT. In addition, government representatives from Industry Canada, Canada Border Services Agency (CBSA), Royal Canadian Mounted Police (RCMP), Health Canada, and Public Safety Canada also participated.

Before opening the dialogue, the Chair gave a brief update on the progress of the ACTA negotiations, summarized the issues related to pharmaceuticals which were discussed at the previous ACTA consultation, and discussed Canada’s approach to some of these topics.

Although there have not been any formal rounds of negotiation since last December, the negotiating participants met in Geneva on June 11, 2009 and confirmed their intention to move forward. The parties agreed on the importance of public transparency throughout the negotiation process. Also, it was decided that the next round of formal negotiations would be held in Morocco in July, with Parties aiming to conclude the agreement in 2010.

Government officials addressed three issues related to medicines that arose at the previous consultation: the issue of in-transit seizures of generic pharmaceuticals; the role of ACTA in addressing the problem of counterfeit and substandard medicines; and the proposal to include a “de minimis” exception in the ACTA. The Chair presented these issues with contributions from other government departments as summarized below.

First, several stakeholders at the previous consultation had expressed concern over the recent seizures of generic medicines in the European Union. While the specifics of these incidents remain unclear, CBSA confirmed the unlikely occurrence of a similar situation within the Canadian jurisdiction due to Canada’s differing legislation and practices. Further, Canada’s position is that the key ACTA obligations should be limited to trademark counterfeiting and copyright piracy.

Second, counterfeit and substandard medicines are a global problem. The ACTA can make a contribution to the fight against counterfeit medicines by establishing international standards for trademark enforcement, but only as a part of Canada’s broader approach. While some stakeholders have proposed the removal of medicines from the scope of the ACTA, ACTA is a non-sectoral agreement, and removing pharmaceuticals would result in lower sectoral enforcement standards. It was also recognized that the ACTA would be open to further accessions in the future, which would enhance its ability to combat the trade of counterfeit medicines.

Finally, the proposed “de minimis” clause evoked divergent reactions from stakeholders at the previous consultation. While some deemed the clause essential to ensure ACTA does not become intrusive, others felt its inclusion created a problematic loophole. Canada supports the inclusion of a “de minimis” clause providing an exemption for personal use, as the objective of the ACTA is to combat large-scale counterfeiting and piracy. In addition, health and safety regulations would continue to apply to any pharmaceutical product entering Canada.

After presenting the main issues that arose at the previous consultation, and Canada’s respective positions, the Chair opened the discussion to all participants, inviting them to share their views, comments, and concerns. The following sections summarize the main themes discussed:

Scope of ACTA

Several participants expressed concern that a future agreement would extend to all intellectual property rights recognized under TRIPS, rather than remain limited to matters of trademark counterfeiting and copyright piracy. There was apprehension that the agreement would include patent enforcement within its scope. Canada supported an ACTA which emphasizes trademark and copyright enforcement.

Stakeholders questioned whether the definition and application of “in transit” had been determined at the ACTA negotiations. It was noted that although “in transit” provisions were under discussion, there had not been a consensus on their inclusion as yet.

Many stakeholders expressed unease over the possible definition of “counterfeit” under an ACTA. There was general concern that an agreement would define “counterfeit” broadly enough to cover patent infringements, and thereby also encompassing generic medicines. Many stakeholders asserted that the ACTA could not deal with problems related to the quality of medicines. The Chair having previously stated that the ACTA would be but one means to combat this problem, restated that pharmaceuticals would not be the focus of the ACTA. In addition, he reaffirmed Canada’s commitment to the Doha Declaration on the TRIPS Agreement and Public Health.

The Proposed “de minimis” Clause

As at the previous consultation, discussions over the “de minimis” exception revealed a lack of consensus among stakeholders. Some felt that it created a critical loophole, while others deemed that the limited resources of CBSA should be devoted to dealing with large-scale problems. Officials had previously asserted that Canada supported the “de minimis” clause as it ensures that the agreement focuses on limiting large-scale infringements. In addition, CBSA noted the need for balance within any ACTA. Without a “de minimis” clause essential medicine could be seized from a visitor to Canada. Although the medicine may be legitimately generic in the home country, it might be deemed an infringement upon entry into Canada. The “de minimis” clause would ensure that an agreement would not have such unintended consequences.

A New Dedicated Counterfeit and Substandard Medicines Initiative Required

Many stakeholders expressed concern that the ACTA would have little impact on the problem of substandard medicines. The majority of the discussion focused on whether issues related to pharmaceuticals, such as counterfeit and substandard medicines should be carved out of the current ACTA under negotiation, to be treated in a separate multilateral agreement. Several arguments were put forth to support this action: First, the ACTA would not deal with the quality of drugs (substandards) and therefore, there should be a more comprehensive agreement regarding medicines only. Second, including medicines in the ACTA agreement could lead to the perception that the issue should be treated as having equal importance to other counterfeit products, and third, treating medicines under the ACTA may lead to a broad definition of “counterfeit,” which may limit the use of generic medicines. Although there was significant support addressing substandard medicines more comprehensively than possible under an intellectual property rights enforcement treaty, some stakeholders expressed concern that carving medicines out of the agreement would jeopardize the progress made on this issue thus far. It was asserted that by excluding this issue from the ACTA, the Parties may not start negotiations on this issue at all, leading to weaker enforcement measures in regards to medicines. The Chair, having asserted in his opening summary that an ACTA would be a non-sectoral agreement, restated that the ACTA would but one forum for the treatment of this issue and that it should be treated as complimentary to other tools.

Participation and Transparency in the ACTA Negotiations

Much of the dialogue focused on discussing the limited number of parties involved in the ACTA negotiations. Several stakeholders felt that the ACTA would be unable to successfully ensure a reduction in counterfeit and substandard medicines if the negotiations did not include the major source or destination countries. In addition, several participants pointed out that the ACTA would alter global standards, affecting developing states even though they were not present at the negotiations. Officials stated that standards would only be changed among likeminded countries that have negotiated and accepted the agreement. In addition, there had been little progress made on enforcement of intellectual property rights at the relevant multilateral institutions due the unwillingness of developing states to engage on the issue. Stakeholders inquired as to whether other countries would be welcome to join the negotiations. The Chair advised that Canada’s understanding was that several parties had approached one of the ACTA countries, but that it was unclear whether any formal requests to join had been made. ACTA negotiating parties intended to discuss this issue at the upcoming round of negotiations in Morocco. In short, the Chair reconfirmed that a future agreement would not be exclusionary and that the intent of the ACTA was to create standards for Canada and other likeminded countries in order to reduce the problem of counterfeiting and piracy.

The dialogue began and ended with calls for greater transparency into the ACTA negotiation process. Participants asserted that it was difficult to engage in the consultation process and give valuable feedback without access to details and draft texts. Some stakeholders proposed the creation of a consultative group, bound by confidentiality agreements, which could provide input on the negotiating texts. However, there was not a consensus among participants on this suggestion.

In closing, the Chair reaffirmed his commitment to push for greater transparency at the ACTA negotiations. He confirmed the importance of the consultation process and invited stakeholders to follow up with any further questions or comments they may have by contacting the Canadian negotiating team with the contact information provided or by making an online submission.

Amir Attaran – Canadian Research Chair in Law, Population Health and Global Development Policy
Jody Cox – Canadian Generic Pharmaceutical Association
Alicia Duval – GS1 Canada
Mark Fried – Oxfam Canada
Michael Geist – Canada Research Chair in Internet and E-Commerce Law
Rachel Kiddell-Monroe – Universities Allied for Essential Medicines
Leah Littlepage – Canadian Intellectual Property Council
Emi MacLean – Médecins sans Frontières
Grant Perry – Canada’s Research Based Pharmaceutical Companies / Les Compagnies de Recherche Pharmaceutique du Canada.
David Skinner – Consumer Health Products Canada / Produits de Sante Consommateurs du Canada

Foreign Affairs and International Trade Canada
Douglas George (Chief Negotiator)
Jennifer Graham
Jacob Kuehn
Don McDougall
Kyla Stockdale

Industry Canada
Sébastien Arès
Shelly Rowe
Matthew Senft

Canada Border Services Agency
Michelle Gillespie
Nicole Lefebvre
Chris Nelligan

Royal Canadian Mounted Police
Supt Graham Burnside

Public Safety Canada
Matthew Senft

Health Canada
Matthew Bown
Matthew Sanger