Page 280 - DMGT401Business Environment

Unit 13: World Trade Organization

developed in response to the huge growth of the service economy over the past 30 years and the Notes
greater potential for trading service brought about by the communication revolution.

Trade Related Intellectual Property Rights

The WTO Agreement on Trade-Related Aspect of Intellectual Property Right (TRIPS), negotiated
in the 1986-94 Uruguay Round, introduced intellectual property rule into the multilateral trading
system for the first time. The WTO TRIPS Agreement is an attempt to narrow the gap in the way
rights are protected around the world, and to bring them under common international rules.
As GATT and GATS, TRIPS also works on the principle of treating national and foreigner players
equally and giving equal treatment to nationals of all trading partners in the WTO. TRIPS
agreement has an additional important principle of intellectual property protection, that it, it
should contribute to technical innovation and the transfer of technology. It says that both producer
and user should benefit, and economic and social welfare should be enhanced.
TRIPS provide adequate protection of intellectual property in the following categories:
1. Copyrights

2. Trademarks
3. Geographical Indications
4. Industrial Designs
5. Patents
6. Layout Design for Integrated Circuit

7. Undisclosed Information and Trade Secrets
8. Curbing Anti-competitive Licensing Contracts
9. Transition Arrangements

Anti-dumping Measures and Countervailing Duties

Dumping means selling the product at below the on-going market price and/or at the price
below the cost of production. Usually, when the organization in an exporting country has some
product in excess then it dumps that amount of production. It prices the excess production on the
basis of marginal costing and charges only variable cost plus profit, thus fixing the price below
the full manufacturing cost. Dumping hurts the industry of importing countries because they
cannot compete with the low priced imported product.

13.4 Organization of WTO

The WTO is run by its member-governments. All major decisions are made by the membership
as a whole, either by ministers (who meet at least once ever two years) or by their ambassadors
or delegates (who meet regularly in Geneva). Decisions are normally taken by consensus. WTO
is a member-driven, consensus-based organization.

Highest Authority: The Ministerial Conference

WTO belongs to its members. The countries make their decisions through various councils and
committees, whose membership consists of all WTO members. Topmost is the ministerial
conference which has to meet at least once ever two years. The Ministerial Conference can take
decisions on all matters under any of the multilateral trade agreements.

LOVELY PROFESSIONAL UNIVERSITY 273