SOCIALISMO Y ANARQUÍA
35 “Esta verdad no es comprendida por los pseudorevolucionarios, dictadores de mañana, que, a
facts: As a contracting state of CBD, China has to establish a legal system to guarantee the achievement of the ABS. As a latecomer to WTO, China has to operate in the context of existing negotiations, fitting its domestic position into a pre-existing historical context. As an emerging economy with an ambition to boost its own bio-industry, China has to balance the interests of big biotech companies, its domestic biological companies, and the development of the local and indigenous communities. In particular, the ambition to cultivate a domestic bio-industry may see China’s position diverge from that of other megadiverse countries.
In this context, China first identified itself as a megadiverse country and co-sponsored various proposals at the TRIPS Council (Section 4.3.2). China also learned from the debate at the TRIPS Council, in particular, proposals by Norway and Switzerland as well as EU, and established the disclosure obligation in its domestic law Patent Law (2008) (Section 4.4). With this clear pro- disclosure position in patent law, China engaged relevant negotiations more actively after 2008 (Section 4.5).
4.3.1 Context for China’s engagement in the disclosure obligation
China is a contracting member of various intellectual property treaties, including TRIPS, International Convention for the Protection of New Varieties of Plants (UPOV Convention,
33 WIPO General Assembly, Forty-seventh (22nd Ordinary) Session, Conversion of WIPO Intergovernmental Committee on Intellectual Property and Genetic Resources, Traditional Knowledge and Folklore (IGC) into a Standing Committee: Proposal by the African Group to The 2015 General Assembly, document prepared by the Secretariat, WO/GA/47/16, July 28, 2015.
34 WIPO General Assembly, Forty-Seventh (22nd Ordinary) Session, Matters Concerning the Intergovernmental Committee on Intellectual Property and Genetic Resources, Traditional Knowledge and Folklore (IGC): Proposal of the United States of America to the WIPO General Assembly, document prepared by the Secretariat, WO/GA/47/17, September 4, 2015.
1978),35 Patent Cooperation Treaty (PCT) and other WIPO treaties.36 These memberships mean China has to undertake treaty obligations on the protection of intellectual property. On the other hand, China joined the CBD in 1992, and participated in the negotiations of the ITPGRFA, although it has yet to sign the latter. These agreements create obligations that in turn create a need for models, thus opening the door to a transplanted model as a possible solution. For instance, becoming a member of both the CBD and TRIPS pushed China into addressing issues of the TRIPS-CBD relationship and to develop its own position when any conflict occurred in domestic implementation or international negotiation.
In contrast to China’s engagement in other IP issues, in which compliance was the first step, there is no compliance pressure in the case of the disclosure obligation. This is because no international agreement has yet been concluded. This allows for plenty of freedom for China to decide which position it should take. As one of the megadiverse countries of the world, strengthening protection of genetic resources on the multilateral level appears to be consistent with China’s interest. This basic fact incentivized China to be active in the international negotiations and shapes China’s position in supporting the disclosure obligation.
As a latecomer to the WTO, China has missed international rule-making for most IP issues at the TRIPS negotiation. The negotiations on the disclosure obligation remain an ongoing process. As a latecomer, China could identify the different positions and then take a side. It could also select the most suitable model for its domestic conditions by learning about the subtle differences among various models in the continuing debate. Indeed, China was a quick learner. Six months after its accession to the WTO, China took the position of supporting other megadiverse countries by co- sponsoring the proposal IP/C/W/35637 at the TRIPS Council in June 2002.
Different from some megadiverse countries that proposed to amend TRIPS to exclude life forms and parts thereof from patentability,38 China has the ambition to develop its bio-industry. In 2010, China identified seven strategic emerging industries 战略性新兴产业 [Zhanlüexing xinxing chanye] to be the backbone for industrial modernization and technological development in the
35 The relevant Chinese law is Regulations on the Protection of New Varieties of Plants (2013). 36 See Appendix I for the multilateral agreements in which China is a contracting member.
next stage, and biological breeding is one of the seven39. In 2015, the Made in China (2025)40 explicitly emphasized the bio-industry as one of the ten high-end industries for China to gain or maintain its competitive advantage.
According to the WIPO IP Statistics Data Centre,41 patent grants to Chinese applicants for biotechnology have surged since 2010. The number of patent grants to Chinese applicants first overtook those to US applicants in 2013, although the US exceeded China again in 2015 (Figure 11).
Figure 11 Patent Grants in Biotechnology (Counted by the Origin of Applicants) (2000-2016)
China is not only playing the domestic game of numbers. PCT applications from Chinese residents in the area of biotechnology have also increased gradually. Although there is still a big gap between China and other industrialized countries, the gap narrows each year (Figure 12).
39 State Council, Decision on Accelerating the Development of Strategic Emerging Industries 国务院关于 加快培育和发展战略性新兴产业的决定 [Guowuyuan Guanyu Peiyu he Fazhan zhanlüexing Xinxing Chanye de Jueding], No. 32 (2010) 国发 (2010) 32号 [Guofa (2010) 32 hao].
40 See note no. 56 of Chapter 2.
Figure 12 PCT Publication in Biotechnology (Counted by the Origin of Applicants) (2010-2017)
Considering that not all biotechnology patents are related to the use of genetic resources, it is necessary to look further into the internal structure of bio-patent applications in China. According to a report by SIPO on the strategic emerging industries (SIPO 2016a), applications submitted to SIPO and the USPTO in the area of biotechnology presented a similar pattern – with intensive patent applications in the field of bio-drugs, bio-medical equipment, and biochemical products. China had more applications than the US in the manufacturing of bio-agricultural products and applied environmental management technology (Figure 13).
Figure 13 Technology Distribution of Patent Applications in the Bio-industry42 From the above figures, the deployment of patents in biotechnologies means that China may not
0 100000 200000 300000 400000 500000 600000 700000 800000 US China Japan Germany Korea
Manufacture of boilogical drugs Manufacture of boilogical food
Manufacture of biofuels Manufacture of bio-agriculture products
Manufacture of bio - chemical products Manufacture of other biological products Manufacture of biomedical equipment Manufacture of biological related equipment Applied agricultural biotechnology Applied forestry biotechnology
patents. The need to promote its domestic patent system in the strategic sector of biotechnology also keeps China silent at the TRIPS Council when it comes to the proposal to amend Article 27.3 to exclude patentability of life forms.
4.3.2 China’s position at the TRIPS Council
China first encountered the issue of the disclosure obligation at the TRIPS Council after its accession to the WTO in 2001. Relevant discussions and debates at the TRIPS Council created opportunities for China to differentiate between various proposals and select an appropriate position to suit its domestic context. Through a process of learning and adaptation, China soon developed a position.
The TRIPS Council Meeting started discussions on the TRIPS-CBD relationship in March 2002,43 three months after China’s accession to the WTO. The Chinese representatives to the TRIPS Council were ignorant of what was going on and what was at stake in the TRIPS-CBD relationship. At this meeting, the Chinese representative said: “the question of potential conflicts between the TRIPS Agreement and the CBD might not be of great importance.” She acknowledged that biological diversity was a “relatively new concept”,44 and showed interest in the US proposal of the contract-based solution. This speech was not a surprise because China was overwhelmed at that moment by the need to amend its domestic IP laws to comply with TRIPS standards. China gradually realized the problems of the US proposal — the unequal bargaining power between the parties.45
China soon developed its position of supporting the disclosure obligation and positive protection of traditional knowledge.46 However, in the early stages, China vacillated between the strong and weak forms of disclosure obligation (Figure 10). On the one hand, China was very cautious in co- sponsoring proposals initiated by other megadiverse countries for the disclosure obligation. Among the various proposals submitted by megadiverse and other developing countries (Table 9), China only co-sponsored two of them (IP/C/W/356 in 2002, and IP/C/W/474 in 2006) before 2008 when its domestic legislation introduced a standard on disclosure obligation. Besides cosponsoring, China sometimes expressed its support for a proposal by other megadiverse countries at the TRIPS Council meetings without being a co-sponsor of that proposal.
China also showed interest in the EU and Norwegian proposals for a weak disclosure obligation. Both proposals considered disclosure as a formal requirement for patent applications, with non-
43 WTO TRIPS Council, Minutes of the Meeting Held in the Center William Rappard on March 5-7, 2002,
IP/C/M/35, March 22, 2002.
44 Ibid, IP/C/M/35, Para. 248. 45 Ibid.
compliance not causing the invalidity of a patent already granted. Chinese representatives took advantage of the TRIPS Council meetings to learn the details of the mechanism proposed by the EU and Norway.47 Such knowledge to a certain extent influenced Chinese domestic rule-making on disclosure obligation (Section 4.4.2).
After China’s announcement of its intention to amend its patent law in 2005, dynamics occurred between China’s position at the TRIPS Council and its domestic legislative process concerning disclosure obligation. Before announcing the patent law amendment in 2005, China had clearly expressed its support for megadiverse countries’ proposals.48 After the legislative process for the patent law amendment started in April 2005, Chinese representatives kept silent in the two TRIPS Council meetings (48th and 49th meeting). These two meetings have been the only two TRIPS Council meetings where Chinese representatives did not speak a word on the disclosure obligation. China’s silence during the 48th and 49th TRIPS meetings shows how careful it was to maintain the consistency of its international position and domestic legislation. After it becomes clear that the expected patent law would set a rule on the disclosure obligation, China reassumed its engagement with the TRIPS Council by cosponsoring a proposal49 to support the disclosure obligation. After the promulgation of Patent Law (2008), the Chinese position at the TRIPS Council on the disclosure obligation became firm and clear (Section 4.5.1).
In addition to the TRIPS Council, the EU and Switzerland consistently took the cross-forum strategy to negotiate the disclosure obligation at the WIPO IGC. Before the amendment of the patent law, China did not actively engage at the WIPO IGC either. As occurred at the TRIPS Council, China used the IGC as another forum to learn subtle differences between different proposals concerning the disclosure obligation.
47 For instance, Chinese representative to the TRIPS Council posed questions to the EC for the details of
the disclosure obligation regarding the legal consequence of violation, whether civil or criminal remedy would be appropriate. See WTO TRIPS Council, Minutes of the Meeting Held in the Center William Rappard on February 18-19, 2003, IP/C/M/39, March 21, 2003, Para. 135.
48 See WTO TRIPS Council, Minutes of the Meeting Held in the Center William Rappard on 8-9 and 31 March 2005, IP/C/M/47, June 3, 2005, Para 57. In this speech, the Chinese representative showed his/her support for the proposals, specifically, WTO TRIPS Council, the Relationship between the TRIPS Agreement and the Convention of Biological Diversity (CBD) and the Protection of Traditional