Brazil tackles the Netherlands on world stage
These drugs were suspected of infringing Dutch intellectual property rights. The complaint claims that the drugs were only patented in the Netherlands, but not in India and Brazil, so should not have been seized.
In fact, the customs authorities acted in accordance with the European Communities Council Regulation 1383/2003 and with the TRIPS Agreement, which regulates the “suspension of release by customs authorities”, providing the following:
“Members shall, in conformity with the provisions set out below, adopt procedures to enable a right holder, who has valid grounds for suspecting that the importation of counterfeit trademark or pirated copyright goods may take place, to lodge an application in writing with competent authorities, administrative or judicial, for the suspension by the customs authorities of the release into free circulation of such goods.
"Members may enable such an application to be made in respect of goods which involve other infringements of intellectual property rights, provided that the requirements of this Section are met. Members may also provide for corresponding procedures concerning the suspension by the customs authorities of the release of infringing goods destined for exportation from their territories”. [italics supplied]
“If the parties fail to settle within 60 days of the receipt of the request for consultation, Brazil can ask for a panel to be appointed to help the Dispute Settlement Body decide whether the measures adopted against shipments of generic drugs break any WTO agreement.”
The only specific situation mentioned by the Brazilian delegation was a shipment of the generic drug Losartan Potassium, which was manufactured in India and destined for Brazil. At the end of 2008, a shipment was detained while in transit through Amsterdam’s Schipol Airport on suspicion of infringing Dutch patent rights. It was then returned to India.
The Brazilian delegation stated that the seizure of the shipment of Losartan Potassium, the applicable sections of the council regulation and some provisions of the Dutch Patent Act are “inconsistent with the obligations of the European Union and of the Netherlands under the Marrakesh Agreement Establishing the World Trade Organization (“WTO Agreement”) and the Agreements annexed thereto”.
In particular, Brazil sustained inconsistency with Articles 1.1, 2, 28, 31, 41.1, 41.2, 42, 49, 50.3, 50.7, 50.8, 51, 52, 53.1, 53.2, 54, 55, 58(b) and 59 of the TRIPS Agreement; Article 4 bis of the Paris Convention; in addition to Articles V:1, V:2, V:3, V:4; V:5, V:7 and X:3 of the GATT; and Article XVI:4 of the WTO Agreement.
It is important to mention that the Brazilian consultations were initiated the day after India’s delegation filed a similar request for consultation with the European Union and the government of the Netherlands. India affirmed that at least 19 shipments of generic drugs were seized by the Dutch authorities while in transit, 16 of which originated in India.
The Indian delegation explicitly cited five circumstances—including the Losartan Potassium case—where shipments of generic drugs were seized on suspicion of infringing Dutch patents owned or licensed by Novartis, Sanofi-Aventis, Merck Sharp Dohme, GlaxoSmithKline and Eli Lilly.
India requested to join the Brazilian consultations, and vice-versa. Canada, Ecuador, China and Turkey also filed requests to join. On June 18, 2010, the European Union accepted the requests. If the parties fail to settle within 60 days of the receipt of the request for consultation, Brazil can ask for a panel to be appointed to help the Dispute Settlement Body decide whether the measures adopted against shipments of generic drugs break any WTO agreement.
