Towards a Horizontal Standard for Limiting Intellectual Property Rights? WTO Panel Reports Shed Light on the Three-Step Test in Copyright Law and Related Tests in Patent and Trademark Law

Abstract

On March 17, 2000, a WTO panel presented its report on patent protection of pharmaceutical products in Canada. Three months later, on June 15, 2000, another WTO panel tabled a report on Section 110(5) of the US Copyright Act. Twin reports concerning EC protection of trademarks and geographical indications for agricultural products and foodstuffs followed on March 15, 2005. In all these reports, the panels embarked on a detailed interpretative analysis of provisions which set forth abstract criteria for limiting intellectual property rights. The origin of this family of corresponding provisions can be traced back to the so-called “three-step test” laid down in Art. 9(2) BC. After its introduction at the 1967 Stockholm Conference for the Revision of the Berne Convention, the three-step test not only has become widespread in copyright law but also entered other fields – in more or less identical shape. The propelling force bringing about the gradual interspersion of international intellectual property law with the three-step test was the 1994 TRIPs Agreement. Derivatives of Art. 9(2) BC can be found in Arts. 13, 17, 26(2) and 30 TRIPs.

The three-step test is a flexible, open provision offering much room for interpretation. As the titles of the aforementioned reports indicate, WTO panels conducted an interpretative analysis of the three-step test in copyright law and related tests in patent and trademark law. They applied Arts. 13, 17 and 30 TRIPs. The decisions give rise to the question whether the application of the test in different areas points towards an emerging horizontal standard for limiting intellectual property rights. Accordingly, the present article seeks to assess the extent to which common principles can be derived from the panel reports. Before turning to the comparative analysis, a short description of the facts of the WTO dispute settlement cases, and an introduction to Arts. 13, 17 and 30 TRIPs will be given in the following sections I. and II. Subsequently, the approaches taken by the different WTO panels will be compared in respect of each criterion of the tests in section III. Concluding remarks will be made in section IV.

Keywords: TRIPS, WTO Panel, dispute settlement, three-step test, copyright law, patent law, trademark law, pharmaceutical products, geographical indications, special case, normal exploitation, legitimate interest, unreasonable prejudice