WIPO Assembly Ends In Deadlock Over Budget, Director General

By William New
The annual General Assemblies of the UN World Intellectual Property Organization ended in a stalemate Wednesday with no approval of a new budget or proposed cuts in patent fees and no decision on the fate of embattled Director General Kamil Idris, according to early reports from some participants.

“It was a catastrophe,” said a participating government official.

The collapse came after voting, rare in WIPO meetings, blocked attempted compromises on patent fee cuts and the budget, according to sources. The outcome potentially adds pressure on the director general, who developed countries are pushing to resign.

“The DG is in an ever more fragile situation,” a second government official said. “And the organisation will be paralysed until the political issue of his early retirement finds a solution.”

It is unclear what will happen next but the Idris issue could be taken up in a session of the WIPO Coordination Committee, the roughly 80-member-state executive body. It is now chaired by the Group B developed countries, and a meeting could be convened with the agreement of a relatively small percentage of the committee membership, according to a source. WIPO was not officially reached for this story.

The outcome deals a small slap to the new Development Agenda, approved earlier in the assemblies, as it limits the organisation to its 2006-2007 budget, which contained a more limited approach to that agenda, a source said. But it will not derail the Development Agenda, sources said.

All of the substantive issues were approved easily during the assemblies, such as the creation of the new Committee on Development and IP, and the renewal of the mandates of key committees on copyrights, patents and traditional knowledge.

But, said the second government participant, “unless there is a change in the leadership of the organisation, Group B will block any progress on the budget, thus eroding the programmatic mandates and financial means for the DG [director general] to exercise a role in facing the new challenges before the organisation, creating considerable pressure for him to leave.”

The developed countries, led by the United States, from the opening morning threatened to hold the assembly hostage over concerns that Idris has lost the ability to govern the organisation after the spread of reports of possible wrongdoing. The main focus is a confidential internal auditor’s report on Idris’ change of his recorded birth date at WIPO that WIPO has kept from public scrutiny but which was seen by a high-level group during the 24 September to 3 October assembly (IPW, WIPO, 28 September 2007).

On the sticky issue of patent fees under the Patent Cooperation Treaty (PCT), the United States had proposed a reduction in fees by 15 percent in light of a multimillion Swiss franc surplus in the past biennium. Developing countries led by Brazil were seeking a smaller reduction and to ensure developing countries were given a cut as well.

In the end, sources said the issues came down to a face-off between the Group B developed countries and the African Group, chaired by Algeria, who were promoting a more lengthy procedural approach to analysing allegations against Idris, including sending the issue to the WIPO Audit Committee. Developed countries are pushing for quick action on Idris.

But it may have been a procedural matter and the non-African developing countries that determined the outcome, the first official said. Heading into the final day, it apparently looked positive for the African Group and the director general, as they appeared to have isolated Group B in its wish to have a full discussion of the Idris issue in a short timeframe.

But a rule was invoked that prevents members who have not paid their dues to WIPO from voting, which sidelined a number of members, the official said. In addition, developing countries outside Africa had been arguing mainly for proper procedure to be followed and ultimately did not weigh in heavily when the vote was held, with some absent and two abstaining, the official said.

When Algeria on behalf of the African Group late in the final evening moved the budget to a vote, the result was 64 to 44, by which it failed to obtain the necessary two-thirds of the votes, ending the assemblies without resolution, the second participant said. There are 184 members in the UN agency. “I think they were not expecting this,” the first participant said. “I think it’s not the end of the story.”

The 2006-2007 budget was about CHF 100 million less than the proposed 2008-2009 budget, the participant said. This leaves out proposed extra funding for the new building construction to begin in February, more security, and for several WIPO treaties.

A report on the PCT Assembly will be circulated to members and posted on the Internet “either indicating lack of agreement or that the issue remains open for further consideration,” according to the second official. Members will be able to submit comments on this issue.

“In the last hour we were discussing the same things as on the first day,” the first participant said, which was whether there could be agreement on a date by which reports on the DG should be analysed and recommendations made.

William New may be reached at wnew@ip-watch.ch.