United States – Section 211 Omnibus Appropriations Act of 1998 (WT/DS176/AB/R): A Comment
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Description
As usual the authors have divided their labor, based on expertise. In particular, the economic analysis in section 4 was the responsibility of Damien Neven; Robert Howse’s own understanding of the costs and benefits of international trade law rules with respect to intellectual property protection in general depends on a rather different framework for analysing the problem. However, in so far as the legal and economic analysis of the Havana Club case itself is concerned, which deals only with trademarks as a form of IP protection, the authors are in agreement. The first part of the chapter (section 2) summarizes the facts of the case and the decision taken by the Appellate Body (AB). [Neven and Howse] emphasize two issues that the AB dealt with, namely the extent to which the TRIPs may contain a substantive obligation to grant protection to a trademark registered in another country and National Treatment. Section 3 discusses the notion of trademarks, the trade-offs involved in protecting trademarks and the extent to which trademark protection should be coordinated across jurisdictions. We observe that there is a strong case in favor of trademark protection in terms of alleviating moral hazard and adverse selection in product choices but we also identify instances where trademark protection can be abused. We also observe that the case for coordination across jurisdictions is less compelling for trademarks than other forms of intellectual property. We find that the international law of trademark protection is generally reflective of this insight, achieving only a minimum of harmonization and imposing constraints mainly when there is a significant external effect that would not be otherwise internalized, namely where the interests of foreigners are at stake. Section 4 highlights and discusses the extent to which the AB has limited the scope for harmonization of trademark provisions across WTO Members and in particular has rejected the positive integration that would be induced by some mutual recognition of trademark provisions across countries. Section 4 takes a broader perspective and discusses how national treatment affects firms’ incentive to set intellectual property rights and the outcome that arises when national treatment applies. This outcome is compared with that which arises under alternative policy regimes and in particular under independent setting of IP rights for domestic and foreign holders and under mutual recognition. It is found that National Treatment is not as attractive as in other areas (like those covered by Art. III) and that mutual recognition, which has been rejected by the AB even in a limited form, has attractive features.
Source Publication
The WTO Case Law of 2002: The American Law Institute Reporters' Studies
Source Editors/Authors
Henrik Horn, Petros C. Mavroidis
Publication Date
2005
Recommended Citation
Howse, Robert L. and Neven, Damien J., "United States – Section 211 Omnibus Appropriations Act of 1998 (WT/DS176/AB/R): A Comment" (2005). Faculty Chapters. 872.
https://gretchen.law.nyu.edu/fac-chapt/872
