Technology transfer and IPRs

K.R. SRINIVAS

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THE Copenhagen Accord does mention a Copenhagen Green Climate Fund and a Technology Mechanism for technology development and transfer in support of action on adaptation and mitigation.1 However, it is silent on crucial aspects of both; perhaps those will be worked out in the negotiations to be conducted later. Nevertheless, the issues of technology development and transfer and the role of intellectual property rights in technology transfer are likely to be contentious issues in future negotiations.2 The Bali Action Plan identified technology as a pillar of action and in the negotiations for a global climate deal, both the developing and developed countries came up with their views on these issues. And though there was no consensus, the drafts did contain many proposals from developing countries that went beyond the rhetoric over intellectual property rights and suggested new initiatives and mechanisms for technology development and transfer. In fact, even as late as 15 December 2009, draft texts were being prepared and negotiated.3

But what next after the accord is not clear. As countries are yet to reveal the positions they might take and their expectations and commitments under the accord, it is premature to arrive at definite conclusions. Nevertheless, it is clear that technology development and transfer and management of the fund will be matters of contention and dispute. For instance, what role the UNFCCC will play in the fund and how the fund will allocate its resources is not clear. If the accord is treated as a political and not a legal document that establishes new funds and mechanism, then the UNFCCC will only have a marginal role. Similar concerns will arise in the case of the technology mechanism. Although the UNFCCC has so far not been successful in actualizing technology transfer, it has established a clearing house mechanism and helped conduct several assessments on technology needs over the years.

 

Given the ambiguous wordings of the accord, it is likely that the mechanism may end up as an independent entity which relies more on diverse sources for funding. In this regard, the need for a technology body had been more or less accepted by the parties in the negotiations prior to the Copenhagen Conference. The G77/China proposal, for instance, was to establish a technology mechanism consisting of a Multilateral Climate Technology Fund, an executive body, functioning as a subsidiary body to the Conference of Parties (CoP). Despite debates over nomenclature, many developing countries supported such an initiative.

But as studies show, there are unresolved issues with the climate technology funds, established and functioning, and it is likely that developing countries will express similar concerns with the proposed fund under the accord.4 Whether G77/China will reiterate their earlier demands in the context of the mechanism proposed under the accord is not yet known, but they may well push for a mechanism similar to the one they had earlier suggested. The proliferation of too many funds in climate change is, however, only likely to result in fragmentation of financing activities and provide less than an optimum solution.

 

Another contentious issue relates to intellectual property rights and their role in technology development and transfer. Here too, the North-South divide was evident and persistent in the negotiations till the finalization of accord. In fact, it was reported that as late as December 16, it figured in the texts on negotiations on technology transfer. In all likelihood, the developing countries, particularly G77/China, will continue to argue that intellectual property rights should not constitute a barrier to the transfer of technology.

Because the accord’s text is silent on many crucial issues and has left them to be thrashed out in subsequent negotiations, the future negotiations are likely to be similarly contentious. It remains to be seen whether countries go beyond these divides and find decisive answers so that reductions in emissions are achieved within an agreed timeframe and the transition to a low-carbon society is facilitated by more and better access to technology and funding. Without claiming precience, this brief note highlights some promising choices and strategies in this direction.

 

Recall the issue of destruction of ozone layer. When science confirmed that the ozone layer was being destroyed rapidly and that the accelerated destruction is harmful to humanity, both USA and Europe swung into action. The Montreal Protocol was negotiated and signed. Issues relating to funding, capacity building and technology transfer, and phasing out Ozone Destroying Substances (ODS) were addressed systematically.5 A small secretariat was set up to manage the fund created under the protocol. The protocol proved to be a great success and developing nations were enabled by technology transfer and capacity building to phase out ODS and switch over to alternatives.

While climate change is a more complex issue and there are no easy technological solutions the relevance of the protocol as a model cannot be ignored.6 Lessons from that experience can be used in developing institutions that enable development of technologies, promote transfer of technologies, and encourage capacity building. The protocol would have failed had the commitments made by the developed countries to the fund not been met. In case of climate change, though the accord provides a figure, the proposed level of funding is woefully inadequate to meet the challenge of climate change. It is, however, expected that once the emission commitments and plans are made available, additional funding would flow and the overall quantum of funding would also increase.

 

When the scary scenarios about looming food shortages and famines, alongside an alarming increase in population in developing countries were made in the 1960s, the response was quick. Governments of both developing and developed countries, philanthropic foundations, FAO, the World Bank came together and sowed the seeds of the green revolution. Soon International Agricultural Research Centres (IARCs) were established in different parts of the world with specific mandates. The IARCs developed new varieties which were tested and further disseminated by organizations that constituted the National Agricultural Research Systems (NARSs). In the process countries like India rapidly increased their foodgrains production and the doomsday scenarios turned out to be untrue.

The Consultative Group on International Agricultural Research (CGIAR) manages the IARCs which, despite ups and downs in terms of funding, have become important institutions in the global food regime. Today, as we know both the achievements and limitations of the process, there are many lessons to be learnt from the green revolution experience in technology transfer and development. Interestingly, in the context of climate change, developing countries, including India, have highlighted the relevance of the green revolution and IARCs as worth emulating in technology development and transfer.7

There are also other new models and paradigms for innovation and technology transfer. Open Innovation and Distributed Innovation are two promising models that can be used in the context of climate change.8 These models have often been used in product development and in finding solutions to problems that need expertise in diverse fields. And although there are some issues in developing technologies and enabling their widespread deployment on a global scale, these models can be used. One of the more contentious issues relates to the ownership of intellectual property rights, sharing the same and making it available. For this solutions like joint ownership, creation of patent pools and patent commons have been suggested. There is in fact an Eco-Patent Commons that makes available patented technologies for finding solutions to climate change. These models go beyond the traditional mode of intellectual property rights ownership and sharing so as to enable innovation and facilitate usage of technology, unlike a monopoly rights regime that restricts access to deny further development.

 

If one goes through the various proposals made by developing countries, academics and other stakeholders on development and transfer of technology, it is clear that while there are concerns about the negative impact of intellectual property rights, alternatives have also been suggested. They can, for instance, actively consider using distributed innovation and open innovation models for implementation. Developing nations have some advantages in some technologies, either on account of innovation capabilities and/or on account of their large market size.

 

For example, countries like India and Brazil have distinct advantages in biofuels, and some of the major producers in solar energy and wind energy are located in India and China. While the technological lead enjoyed by developed countries is an important factor, developing countries can encourage more innovation and sharing of technologies among themselves to identify areas for joint development and transfer of technologies. Expertise in specific fields can be shared and mutually beneficial trading arrangements can be worked out. They can also acquire patents for specific technologies or for critical processes and develop them further. Though difficult for an individual company, it is easier for countries to come together, buy out patents and license them to companies, to ensure a rapid diffusion of technologies.

To sum up, South-South cooperation should enable developing countries to acquire, develop and transfer technologies that are relevant at affordable cost. Let us not underestimate the innovative capacity of developing countries in this regard. India has become a global player in IT services and the manufacturing prowess of China or the innovative capacity of South Korea is beyond doubt. Brazil has distinctive advantages in sugar based ethanol technology. Hence, a South-South alliance involving major countries is a workable solution.

True, reality is more complex and messy. Trade issues could become potential sources of friction and moves like Border Adjustment Tax can become a veil for protectionism. Much, for instance, depends upon the outcome of the pending legislation in the US Senate, something that would be known by February 2010. Since one does not expect miracles or sweeping changes in its provisions, several rounds of hard bargaining and protracted negotiations are likely till the Conference of Parties is convened again in the last month of this year.

But if the parties are serious about adhering to the Bali Action Plan on technology, they will have to find solutions that enable rapid development and deployment of technologies. So far, despite all their differences, they recognize the central role of technology in the transition to a low-carbon global society. Hence, with some flexibility in positions, it is not impossible to find solutions to vexing problems. One hopes that the countries will go beyond the North-South divide to find fair and equitable solutions to technology development and transfer issues. Developing nations can come together and form alliances in technology development and transfer.

One important lesson from the global environmental negotiations, in particular from the debates and negotiations over technology transfer since the 1970s, is that the North-South divide cannot be wished away. In case of climate change too this is the reality but solutions can be found if the parties consider technology as a global public good and arrive at win-win solutions.9 The big question is will they?

 

* The views expressed are personal.

Footnotes:

1. See Earth Negotiations Bulletin 12(459), CoP 15 Final, 22 December 2009, for an analysis http://www.iisd.ca/climate/cop15

2. There is by now a large literature on technology development and transfer and related issues, including intellectual property rights. For example, see UNDESA Background Paper, Climate Change: Technology Development and Technology Transfer for Beijing High-Level Conference, DESA, New York, UN, 2008.

K.R. Srinivas, ‘Climate Change, Technology Transfer and Intellectual Property Rights’, DP-153, RIS, 2009, New Delhi, http://www.ris.org.in/dp153_pap.pdf

B. Lee et.al., Who Owns Our Low Carbon Future, Chatham House, London, 2009, http://www.chathamhouse.org.uk/files/14732_r0909_lowcarbonfutureses.pdf

Cynthia Cannady, Access to Climate Change Technology by Developing Countries: A Practical Strategy. ICTSD’s Programme on IPRs and Sustainable Development, Issue Paper No. 25, International Centre for Trade and Sustainable Development, Geneva, 2009.

Antoine Dechezleprêtre, Matthieu Glachant, Ivan Hascic, Nick Johnstone and Yann Ménière, Invention and Transfer of Climate Change Mitigation Technologies on a Global Scale: A Study Drawing on Patent Data, Final Report, CERNA, Mines ParisTech, 2008.

For an analysis of proposals on transfer of technology in the negotiations, see Christiane Gerstetter and Dominic Marcellino, The Current Proposals on the Transfer of Climate Technology in the International Climate Negotiations: An Assessment. Ecologic Institute, Washington D.C., 16 November 2009, http://ecologic.eu/2998

3. http://www.ip-watch.org/weblog/2009/12/16/copenhagen-meeting-third-tech-transfer-draft-may-go-to-ministers-with-ip/

4. See S. Nakhooda, Catalyzing Low Carbon Development? The Clean Energy Fund, World Resources Institute, Washington DC, 2009.

5. Stephen O. Andersen, K. Madhava Sarma and Kristen N. Taddonio, Technology Transfer for the Ozone Layer: Lessons for Climate Change, Earthscan, London, Sterling, VA, 2007.

6. Dilip R. Ahuja and J. Srinivasan, ‘Why Controlling Climate Change is More Difficult Than Stopping Stratospheric Ozone Depletion’, Current Science 97(11), December 2009, 1531-1534.

7. Carlos M. Correa, Fostering the Development and Diffusion of Technologies for Climate Change: Lessons from the CGIAR Model, ICTSD, Geneva, December 2009.

8. Lewis Milford and Daniel Dutcher, Climate Choreography: How Distributed and Open Innovation Could Accelerate Technology Development and Deployment. Montpelier, VT: Clean Energy Group, 2008 http://www. cleanegroup.org/Reports/Climate_ Choreography_July08.pdf

9. Scott Barrett, Why Cooperate? The Incentive to Supply Global Public Goods, Oxford University Press, 2007.

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