Determining the Upper Bound of the Scoping Criteria for Amount B in the OECD/G20 Two-Pillar Solution: A Policy Guide for Developing Jurisdictions
By Chetan Rao, Ruchika Sharma, and Dr. Vijit Patel
Amount B, a component of the OECD/G20 Two-Pillar Solution, has been designed to simplify transfer pricing for baseline distribution activities. With the aim of developing a practical policy guide for developing jurisdictions to fine tune the quantitative scoping criterion under Amount B, i.e., “annual operating expense to annual net revenue” ratio, this paper critically analyses various aspects of this criterion. The upper bound of this ratio is purported to help jurisdictions in identifying baseline distributors. It is currently set as a flexible range from 20% to 30%, with the choice available to each adopting jurisdiction deciding the exact point in the range for implementation of Amount B within its jurisdiction. Given the lack of any data-backed rationale in the Amount B report for development of this range, the authors suggest that the upper bound range might have been politically negotiated. For this very reason, developing countries need to tread carefully while setting the upper-bound and consider both its tax as well as policy implications. Through an empirical analysis of independent distributors in India, the paper highlights the link between the upper bound, functionality, and profitability, illustrating how these metrics impact developing countries with lower asset and expense intensities. The findings suggest that setting the upper bound at the higher end of the range could unintentionally bring above-baseline distributors into scope, thus foregoing long-term taxing rights for developing jurisdictions. Through this analysis, the paper offers practical insights and recommendations for jurisdictions, especially developing ones, for setting this upper bound to protect their taxing rights and minimize risks of misclassification of above-baseline distributors as baseline.
Health, Intellectual Property and Biodiversity Programme, November 2024
The following matrix provides a factual overview and analysis of the standing and non-standing agenda items of the regular session of the WTO TRIPS Council of 6-7 November. The matrix also discusses the TRIPS Implementation issues as part of the WTO Doha Development Round of negotiations.
Régulation internationale des dessins et modèles industriels : l’Accord sur les ADPIC à l’aune du droit de l’Union européenne
Par Adèle Sicot
Ce document analyse les dispositions de l’Accord sur les aspects des droits de propriété intellectuelle qui touchent au commerce (l’Accord sur les ADPIC) sur les dessins et modèles et la manière dont les aspects limités traités par l’Accord ont été abordés par la législation de l’Union Européenne (l’UE). Il note l’absence d’une définition de la matière susceptible de protection et une considérable flexibilité laissée aux pays membres de l’Organisation Mondiale du Commerce pour déterminer le cadre de protection, notamment sur la base du droit d’auteur. Le document note aussi certains aspects dans lesquels la législation européenne est plus élaborée et d’autres dans lesquels on pourrait observer une incompatibilité avec l’Accord sur les ADPIC.
De nouvelles pandémies sont inéluctables. Comment mieux s’y préparer et surtout comment éviter les erreurs et injustices commises durant la pandémie du Covid-19 ? Des négociations sont en cours pour formuler un traité international contraignant sur la prévention et la préparation pour des réponses plus justes aux futures pandémies. Ce livre se veut une contribution critique aux débats en cours.
Comment garantir l’accès équitable aux médicaments et diagnostics, alors que la majorité d’entre eux sont produits dans un petit nombre de pays ? Comment expliquer que le financement actuel de la coopération en matière de santé se retrouve entre les mains d’un groupe réduit de pays et fondations du Nord ? Comment renforcer le rôle de l’Organisation mondiale de la santé, qui ne joue plus qu’un rôle mineur dans la coordination des politiques de santé publique ? Comment se fait-il que le concept de « médicaments essentiels », une avancée majeure dans les politiques de santé publique, soit remplacé par celui de « contre-mesures médicales », un terme qui s’accorde plutôt à la logique de profit du secteur privé ?
La préparation aux futures pandémies nous oblige à nous interroger : comment préserver l’intérêt général, la défense des droits de l’homme et la santé publique ?
Auteur: Germán Velásquez est conseiller spécial en matière de politique et de santé au South Centre à Genève.
Towards a Balanced WIPO Design Law Treaty (DLT) for Developing Countries
By Nirmalya Syam
The WIPO Design Law Treaty (DLT) aims to harmonize and simplify global industrial design registration procedures, encourage digital applications and reduce costs. While the reforms required by the DLT could boost efficiency, they will mainly benefit enterprises from developed countries with resources to secure global design rights. This policy brief highlights the key concerns for developing countries, particularly the treaty’s potential impacts on small and medium-sized enterprises (SMEs) and indigenous communities. It advocates for critical adjustments in the DLT negotiation texts to allow for policy space in the DLT – binding technical assistance, flexible grace periods, enabling disclosure of the origin and source of traditional knowledge and traditional cultural expressions used in designs that are sought to be registered, and optional divisional and electronic filing provisions.
Group of 77 and South Centre convening on the Future of Antimicrobial Resistance Response in Developing Countries
Meeting Report
October 2024
On 25 September, the South Centre with the Group of 77 and China discussed solutions for tackling Antimicrobial Resistance and ensuring access to antibiotics and diagnostics.
Can international law promote innovation from genetic resources and benefit sharing while recognizing the rights of traditional knowledge holders?
By Henry de Novion
Indigenous peoples and local communities have been innovating for millennia and contributing to the development of new products and processes. For international law to promote innovation, it is indispensable to promote indigenous peoples and local communities’ rights to prior informed consent, to benefit sharing, and to guaranteeing their territories, culture, and existence.
The Implications of Treaty Restrictions of Taxing Rights on Services, Especially for Developing Countries
By Faith Amaro, Veronica Grondona, Sol Picciotto
Taxation of cross-border services has been identified as a high priority issue in the United Nations (UN) negotiations to establish a new global framework for tax. This paper analyses the defects of international tax rules as applied to services, and their exploitation by multinational enterprises (MNEs), focusing on the impact on developing countries. Services have become increasingly important for economic development, but international tax rules favouring delivery by non-residents act as a disincentive to the growth of local services providers, particularly disadvantaging developing countries which are mainly hosts to MNEs. We analyse the restrictions on source taxation of services in tax treaties, particularly those based on the model of the Organisation of Economic Co-operation and Development (OECD), and show that their spread has been accompanied by a widening deficit in services trade of developing countries, while the weakening of their attempts to protect their tax base through withholding taxes has resulted in increasing losses of tax revenue. The paper combines detailed qualitative analyses of tax treaties with quantitative estimates of their effects on trade and tax revenues for services of five developing countries: Argentina, Brazil, Colombia, Kenya and Nigeria. Our analysis suggests that a new approach is needed for taxation of services, breaking with the residence-source dichotomy, and adopting formulary apportionment. This could be based on the standards agreed in the Two Pillar Solution of the OECD/Group of Twenty (G20) project on base erosion and profit shifting (BEPS) and developed now through the UN.
Summary of Carlos Correa’s intervention at the 25th Meeting of COMSATS Coordinating Council
Below is the summary of South Centre Executive Director Carlos Correa’s intervention at the 25th Meeting of the Commission on Science and Technology for Sustainable Development in the South (COMSATS) Coordinating Council.
A Fair Solution for Access and Sharing of Benefits of Digital Sequence Information? Decision for the CBD COP in November 2024
By Viviana Munoz Tellez
A decision is expected from the Conference of the Parties of the Convention on Biological Diversity (CBD) by 1 November 2024 on a solution to the fair and equitable sharing of benefits from the use of digital sequence information (DSI) on genetic resources. There are different forms of non-monetary and monetary benefits from the use of DSI that are being considered. This paper argues that for monetary benefit sharing, the focus should be on when DSI is used commercially, as part of products or services. Calculations should be based on revenue that includes sales and intellectual property licencing.
Decision 15/9 and the Nagoya Protocol: Who should get what in the Multilateral Benefit-Sharing Mechanism?
By Joseph Henry Vogel, Natasha C. Jiménez-Revelles, Xavier A. Maldonado-Ramírez de Arellano
Article 10 of the Nagoya Protocol (NP), “Global Multilateral Benefit-Sharing Mechanism” (GMBSM), asks Parties to consider the distribution of benefits derived from the utilization of genetic resources in transboundary situations. A literature exists which applies the economics of information to genetic resources, when interpreted as “natural information”. The policy implication would incentivize reduction in the drivers of mass extinction, through economic rents in royalty obligations. Fifteen cases become thought experiments on how to share royalty income. A sixteenth case addresses the TP53 gene in elephants, which may revolutionize oncology. In parallel to Article 10 of the NP is Decision 15/9 of the fifteenth Conference of the Parties to the Convention on Biological Diversity. That Decision establishes a “multilateral benefit-sharing mechanism from the use of digital sequence information on genetic resources”. Redundancy with the GMBSM is only apparent. The Decision omits rents and thus renders its mechanism inefficient, unfair and inequitable.
AMR in Aquaculture: Enhancing Indian Shrimp Exports through Sustainable Practices and Reduced Antimicrobial Usage
By Robin Paul
This study on Antimicrobial Resistance (AMR) in Indian shrimp farming underscores its critical impact on public health, environmental sustainability, and economic viability. The global scenario with many export rejections on account of persistent residues of antibiotics, reiterate that antimicrobial use in aquaculture, demands urgent global attention.
In the Indian context, the shrimp industry grapples with a delicate balance between production demands and long-term shrimp health. Sustainable practices, including responsible antimicrobial use, are crucial for economic viability, given the industry’s reliance on specific markets like the United States, EU and China.
Sustainable aquaculture emerges as a pivotal solution, supported by government policies and a gradual industry shift towards best practices. However, challenges persist, requiring a comprehensive approach to balance economic interests with environmental conservation. The key challenges remain the large number of small stakeholders and huge geographical spread of farms which make implementation of regulations and sharing of best practices difficult. Traceability and certification programs can play a key role in promoting responsible aquaculture, ensuring transparency and accountability in the supply chain. Technological innovations, including block chain can offer efficient solutions for traceability.
The collaborative action suggested emphasizes the role of government bodies, regulatory agencies, industry players, researchers, and consumers in addressing AMR. Clearer implementable regulatory frameworks aligned with economic and environmental priorities are essential. Looking ahead, the study envisions a future where the blue economy is sustainable not just for the industry’s success but also to protect the wider environment. By enhancing domestic market presence and fostering collaboration with importing countries, the Indian industry can overcome the multiple challenges raised by AMR in shrimp aquaculture.
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