Bilateralism, MFN and TRIPS: Exploring Possibilities of Alternative Interpretation
International Trade Law and Regulation, Vol. 13, No. 4, pp. 67-78, 2007
19 Pages Posted: 8 May 2010 Last revised: 24 Aug 2014
Date Written: May 5, 2010
Many bilateral trade agreements signed by developing countries contain intellectual property rights rules more stringent than the standards given in the TRIPS agreement. These are known as TRIPS plus provisions. This article discusses whether the most favoured nation (MFN) clause occurring in the TRIPS agreement binds developing countries, which are parties to bilateral agreements containing TRIPS plus rules, to extend the same TRIPS plus provisions to rest of the WTO member countries. This article argues that such an expansive interpretation of the MFN rule is untenable because it will curtail the policy space of developing countries. A liberal interpretation of the MFN clause in this regard is also indefensible because the TRIPS agreement is governed by the fundamental GATT principles and one such principle is ‘exception to non discrimination by signing bilateral agreements’, consistent with the WTO. TRIPS plus provisions in bilateral agreements are an exception to MFN. Similarly, the MFN clause in the bilateral investment agreements should not be interpreted in a manner that allows a country to shop around for a beneficial intellectual property right provision from other investment agreements signed by the host country.
Keywords: TRIPS, MFN, Bilateralism, Free Trade Agreements
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