Wither Intellectual Property?

(This is an edited version of Francis Gurry’s address to its General Assembly meeting as he took up the position of Director General of the World Intellectual Property Organisation (WIPO) earlier this week.)

The evolution of technology, the economy and global society in recent years has raised a number of challenges of a fundamental nature for the World Intellectual Property Organisation (WIPO). The most fundamental of all is perhaps the new attention that is directed at intellectual property.

As a highly specialised subject matter, intellectual property enjoyed many long and quiet years in the shade before, quite suddenly, in the last two decades, coming under the full glare of the blazing sun of public opinion and scrutiny. The management of this climate change in the world of intellectual property is itself a major task.

In this regard, it is useful to remember that intellectual property is not an end in itself. It is an instrumentality for achieving certain public policies, most notably, through patents, designs and copyright, the stimulation and diffusion of innovation and creativity on which we have become so dependent, and, through trademarks, geographical indications and unfair competition law, the establishment of order in the market and the countering of those enemies of markets and consumers: uncertainty, confusion and fraud.

In the end, our debates and discussions are about how intellectual property can best serve those underlying policies: whether modifying the international framework will enhance or constrain innovation and creativity and contribute to their diffusion, and whether it will add confusion, rather than clarity, to the functioning of the market.

Risk to IP threatens innovation and creativity

There are a number of developments affecting the institution of intellectual property as we have always known it, that risk impairing its capacity to deliver on its basic mission of stimulating innovation and creativity and contributing to market order. WIPO needs to anticipate and to address directly the implications of these developments.

A first such development is the sustained trend towards the infusion of technology into every aspect of our daily lives and into every part of economic existence. As the trend has accelerated, the economic value of innovation has increased and, with it, the desire to acquire property rights over the frontiers of knowledge.

When the Paris Convention for the Protection of Industrial Property was first concluded in 1883, there were approximately 80,000 patent applications, or new technological solutions, filed around the world. Last year the number was 1.7 million.

Patent offices choke on demand

The functional consequence of this trend is that the system is becoming a victim of its own success. Patent Offices are choking on demand and struggling to perform in a manner that is timely enough to be responsive to the needs of the economy. There are an estimated 3.5 million unexamined patent applications in the world today.

The quality of the output of Patent Offices, pushed to cope with such strong demand, is also under critical scrutiny. The Patent Cooperation Treaty (PCT), the financial backbone of WIPO, was designed to provide a multilateral means of dealing with the growth of demand and internationalisation of the patent system.

While it has been a major example of success in international cooperation -for various reasons related more to the behaviour of actors in the system than to the system itself - it is not providing a sufficiently adequate solution to the crisis in demand management.

The problem is of such a critical and urgent nature that a solution will be found. It is of fundamental importance, I believe, that the solution be a multilateral one, rather than one established by a group or groups of the most adversely affected States. The PCT provides a better basis for constructing the future solution than any other one under consideration or in the range of current imagination.

Internet poses a threat to culture

In the area of creative works - the artifacts of our culture - the challenges are even more fundamental. The twentieth century model of returning value to creators, performers and their business associates, which relied on the distribution of physical packages containing the works, is under the most radical of threats from the convergence of expression in digital technology and the distributional power of the Internet.

This development may well work to the special disadvantage of the developing world, where creators and performers do not have the same access to the Internet, bandwidth and alternate models of obtaining financial rewards as their counterparts in the developed world. For the whole world, incentives to the creation of content for the educational system and the enrichment of our lives with literature, music, films and other creative works are fundamental questions.

As in the case of the choking of the patent system, solutions will be found. Perhaps here, the market itself may find the solutions in systems of private law and in the private application of technological solutions. Perhaps those solutions would be appropriate. But it would be unfortunate if we were to move from a centuries-old system of publicly created and overseen rights to systems of private law simply by default, as opposed to conscious choice.

The discussion is not an easy one. In each country, there are many more consumers than creators and performers, making the political management of the discussion uncomfortable. This feature of domestic politics, as well as the global nature of file-sharing on the Internet, suggests that it may be more appropriate to conduct the discussion at the international, rather than the national level.

The Berne Convention, one of the origins of WIPO, was founded in the Nineteenth Century as a consequence of the concern of authors about the impact of the international movement of their physical works. I believe that WIPO remains the right forum to conduct the discussion in the Twenty-First Century about the same question dressed in different technological clothes.

Counterfeiting and organised crime

The widespread illegal downloading of music and films from the Internet raises more generally the question of respect for intellectual property. Very significant developments have occurred also in the counterfeiting of physical products. The phenomenon has long ceased to affect only luxury goods and has spread to many other sectors of the economy, raising serious concerns for health and safety and consumer protection.

Organised crime has become a major participant. On one estimate, the value of counterfeit goods in international trade exceeds $200 billion per annum. Plurilateral accords to deal with the scourge are under active consideration. The risks to health and safety and to consumer protection, however, are present globally and the illegal activity occurs everywhere and not only in specific localities.

Reflection is needed, therefore, on the appropriate role in this area for WIPO, the international organisation responsible for intellectual property. Should that role be confined to awareness-raising and the training of customs officials, the police and the judiciary? Or should it encompass a more robust engagement and, if so, alone or in cooperation with other concerned international agencies?

Broadening the horizons of IP

So far I have referred to factors in the external environment that pose risks to the functioning of the intellectual property system as it stands today. No less important, however, are the developments that call upon the intellectual property system to broaden its horizon and to make its mission more attuned to the collective consciousness of the international community.

First and foremost is the question of how intellectual property can contribute to the reduction of the knowledge gap and to greater participation on the part of the developing and least developed countries in the benefits of innovation and the knowledge economy.

The differences that exist are well known to all of us, but are perhaps most starkly illustrated by the fact that a number of corporations now each spend more each year on the generation of new knowledge than the majority of Sub-Saharan countries each have available to spend on the whole of their countries’ needs in all fields of government, including education, the health system, infrastructure and so forth.

Overall, across the world, a trillion dollars is spent each year in research and development. Intellectual property alone is not going to bring about the solution to differential levels of development. But the recent consensus in WIPO on a Development Agenda provides a wonderful opportunity for us to be part of the solution.

For the Development Agenda to fulfill this promise, I believe that it essential that we translate the political consensus into concrete and effective projects. The opportunity exists for WIPO to construct a global knowledge infrastructure, comprising public, freely available databases of technological and scientific information and operating on common standards for data interchange. Such an infrastructure would contribute in a practical way to sharing the social benefit of intellectual property systems. Through office automation and training, intellectual property offices and research institutions and universities in the developing world could be equipped to participate in this infrastructure.

The Development Agenda offers equally an opportunity for WIPO to review the effectiveness of its service delivery in the area of capacity building. I believe that the adoption by countries of National Intellectual Property and Innovation Strategies, which WIPO could assist in developing, where so desired, would provide excellent vehicles for aligning the capacity-building activities of the Organization with the economic resource base and the economic objectives and priorities of countries.

Protecting traditional knowledge

The protection of traditional knowledge and traditional cultural expressions is another area that has been identified as a means of broadening intellectual property to make it more responsive to the needs of the developing world. The same phenomena of a globalising economy and the advances in communication technologies have exposed special vulnerabilities of indigenous peoples and traditional communities to the unfair loss and appropriation of the products of their traditional knowledge systems.

Challenge of the quickening pace of technological change.

It took humanity five million years to progress from the point where it began walking on two feet, thus freeing its hands for purposes other than locomotion, to the development of the first stone tools, then 1.8 million years to the mastery of fire, 700,000 years to the agrarian revolution, only 12,000 years to the industrial revolution and a mere 140 years to the information revolution. The questions that confront intellectual property are, in many ways, generational questions and it would be a pity to see them squandered in polemics and in the narrow considerations of local politics. The challenge for the multilateral community is that these generational questions are arising more and more frequently because the pace of technological progress is reducing the time separating the generations. Responding to the questions will require our combined ingenuity and versatility.