EU proposes multilateral trade action plan in response to COVID-19
Last Friday, 4 June, the EU submitted its proposal seeking the commitment of World Trade Organization (WTO) members for a multilateral trade action plan to expand the production of COVID-19 vaccines and treatments and ensure universal and fair access. With this proposal, the EU underlines the WTO's central role in the response to the COVID-19 pandemic and urges fellow WTO members to agree on a set of commitments. The EU calls on governments to:
- Ensure that COVID-19 vaccines and treatments can cross borders freely.
This aims to limit the use of export restrictions and keep supply chains open. Vaccine-producing countries should be ready to export a fair share of their domestic production. Supply chains are highly interconnected and should not be disrupted. In addition, the EU considers that supplies to the COVAX Facility should never be restricted, and no measures should limit trade in inputs necessary for the production of COVID-19 vaccines and treatments.
- Encourage producers to expand their production, while ensuring that those countries most in need of vaccines receive them at an affordable price.
This calls on governments to strongly encourage and support vaccine manufacturers and developers to expand production and ensure the affordable supply of vaccines to low- and middle-income countries. Such actions could include licensing agreements, the sharing of expertise, tiered pricing including non-profit sales to low-income countries, contract manufacturing and new investments in manufacturing facilities in developing countries. The EU expects all vaccine producers and developers to make concrete pledges that increase supplies to vulnerable developing countries. In this regard, the EU welcomes the commitment of companies such as BioNTech and Pfizer, Johnson & Johnson and Moderna, which have already committed to delivering 1.3 billion doses this year to low-income countries at no profit and to middle-income countries at a lower cost.
- Facilitate the use of compulsory licensing within the WTO's existing Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS)
This sets out that voluntary licences are the most effective instrument to facilitate the expansion of production and sharing of expertise. Where voluntary cooperation fails, compulsory licences, whereby a government grants a targeted licence allowing a willing producer to make a vaccine without the consent of a patent holder, are a legitimate tool in the context of a pandemic. The EU considers that all WTO members should be ready to:
- agree that the COVID-19 pandemic is an exceptional circumstance of national emergency and that the requirement to negotiate with the rights' holder may be legitimately waived where needed;
- support manufacturers that are ready to produce vaccines and/or treatments at affordable prices under a compulsory licence so that the level of remuneration paid by the manufacturer to the patent holder reflects such affordable prices;
- agree that the compulsory licence could cover any exports destined to countries that lack manufacturing capacity, including via the COVAX facility.
Image © European Commission, 2021
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