Research Handbooks in Intellectual Property series
Edited by Irene Calboli and Edward Lee
Chapter 7: Working toward international harmony on intellectual property exhaustion (and substantive law)
The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS)1 was an important watershed in the international law of intellectual property rights (IPRs). It moved the effort to harmonize transnational intellectual property (IP) beyond regime specific agendas to setting standards governing all IPRs. It also created a unique dispute resolution process for addressing complaints regarding member nations’ non-compliance and, by connecting it to the World Trade Organization (WTO), explicitly tied IP law to international trade. Although the parties reached agreement regarding a wide array of significant substantive points, one issue proved intractable. They could not reach consensus regarding IPR exhaustion—how an IPR owner putting goods into one WTO member’s domestic market would affect its parallel IPRs in other WTO nations. That point might seem a mere matter of detail in the context of such an overwhelmingly successful negotiation. However, examining the reasons behind the failure to agree on exhaustion explains not only why the issue remains so divisive, but also why the domestic implementation of TRIPS has proven so problematic. More importantly, that understanding provides a way forward regarding both exhaustion and harmonization.
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