Intellectual Property in the Twenty-first Century: Will the Developing Countries Lead or Follow?

Developing countries, particularly the BRIC countries of Brazil, Russia, India, and China, should accommodate their national systems of innovation to the worldwide intellectual property (IP) regime emerging after the adoption of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) in a way that maximizes global economic welfare in the foreseeable future. As many developed countries' experience demonstrates, badly configured, over-protectionist IP regimes stifle innovation by making inputs to future innovation too costly and too cumbersome to sustain over time. More carefully considered IP regimes, however, are an important way to protect innovative small- and medium-sized firms from predatory, larger competitors. The challenge is for emerging economies to capture the benefits of IP without importing the serious problems that developed countries have themselves failed to solve. Emerging economies can attain this balance by pursuing a policy of counter-harmonization in which they take advantage of existing exemptions in international agreements governing IP to establish regional, local, and international practices that promote more innovative, flexible uses of IP. Such practices include a research exemption for experimental uses of IP, government imposed nonexclusive licensing, anti-blocking provisions, an essential facilities doctrine, and compulsory licenses. Additional tools include an ex ante regime of compensatory liability rules for small scale innovation and sensible exceptions, particularly for science as well as general fair use provisions, to the exclusive rights of domestic copyright laws. Emerging economies will have to overcome strong economic pressure to accept more restrictive IP regimes as part of free trade agreements as well as a lack of technical expertise and internal government coordination. However, emerging economies have already accrued enough experience to be aware of the strengths and weaknesses of various IP schemes and their own ability to tailor IP to local needs. Developing countries will need to take advantage of that experience and defend innovative practices at international dispute resolution forums. Through creative, determined efforts, the developing countries can avoid other countries' IP excesses while establishing the kind of IP norms that address the real conditions of creativity and innovation in today's digitally empowered universe of scientific discourse.