GLOBAL PATENT PACT FACES REVIEW DEBATE MAY REOPEN IF FARM ISSUE SETTLED

GLOBAL PATENT PACT FACES REVIEW DEBATE MAY REOPEN IF FARM ISSUE SETTLED

A historic draft agreement on intellectual property rights could be reopened for debate if trade officials iron out the thorny agricultural issues that have dragged out global trade liberalization talks for more than five years, a top negotiator said.

Lars Anell, chairman of the intellectual property negotiating group for the Geneva-based General Agreement on Tariffs and Trade, or GATT, said a solution to the agricultural subsidies reduction issue would free up negotiators for a closer look at the intellectual property rights pact drafted in December under deadline pressure from GATT Director General Arthur Dunkel.Most likely to come under attack are a transitional arrangement for patent protection and proposed methods for distributing taxes levied on blank videotapes and audio cassettes, according to Mr. Anell.

Some countries levy such taxes then pay the money out as compensation to

copyright owners whose motion pictures or sound recordings are illegally copied.

"I expect strong resistance from all countries that were forced to introduce a new system and who think that 10 years (for transition to the new laws) is a fair system," Mr. Anell said in a telephone interview from the Swedish mission in Geneva.

Most irksome to the United States, for example, is a provision that gives developed countries just one year, after the accord becomes effective, to make their own laws comply with the new GATT rules. Developing countries would have five additional years to do so and the poorest nations 10 years.

Joshua Bolten, general counsel for the U.S. Trade Representative, told a Senate subcommittee in Washington D.C. Friday that the 10-year grace period is a top U.S. grievance. (Story, Page 2A.) The United States wants a much shorter grace period.

Jonathan Huneke, manager of intellectual property for the U.S. Council for International Business, New York, said U.S. companies in the pharmaceutical, computer and machine manufacturing industries are especially unhappy with the lengthy grace period for developing countries.

"We're very concerned about it," Mr. Huneke said. "What's in it for us if it takes 11 years? It's meaningless. In the meantime, we're being ripped off of intellectual property," he said.

According to Mr. Anell, however, developing countries would be hesitant to renegotiate the provision on patent protection unless they are given something in return. A trade-off could mean greater access in Western markets for their textile goods, he said.

GATT, which sets rules for most of the world's trade in goods, is the sponsor of the current Uruguay Round of trade liberalization talks. The round, the eighth in GATT's 44-year history, is the first to address the issue of intellectual property rights, which include patents and trademarks, as well as copyrights on products from computer software to films to pharmaceuticals.

Another provision of the intellectual property rights pact that may resurface is the way revenues from taxes on blank tapes and cassettes are distributed to copyright owners.

Executives from many motion picture and sound recording companies in the United States contend the GATT accord does not guarantee them adequate compensation from the pool of collected revenues for the U.S. films and recordings shown in the foreign countries, said a source with an international agency.

"U.S. companies don't feel they're getting their fair share. They don't feel all their problems are being solved by the (intellectual property) agreement," said the source, who declined to be named.

Mr. Anell said he disbanded GATT's intellectual property negotiating group last December after it submitted its proposal to Arthur Dunkel, the director general of GATT.

Trade negotiators are now trying to reach an agreement on the controversial agricultural issues before they proceed with resolving any other issues.