Office of the United States Trade Representative
Executive Office of the President
Washington DC 20506
FOR IMMEDIATE RELEASE
Wednesday, January 15, 1997
CONTACT:
Jay Ziegler, Kirsten Powers, Christine Wilkas
(202) 395-3230
USTR-DESIGNATE BARSHEFSKY ANNOUNCES GSP SANCTIONS AGAINST
ARGENTINA FOR CONTINUING IPR PROBLEMS
United States Trade Representative-designate Charlene
Barshefsky today announced the Clinton Administration's
decision to withdraw 50 percent of the trade benefits
granted to Argentina under the U.S. Generalized System of
Preferences (GSP). Duty-free importation of products from
Argentina will be withdrawn with respect to approximately
$260 million of trade. This decision was the result of the
"out-of-cycle" review under the U.S. Government's "special
301" program, designed to advance the protection of U.S.
intellectual property rights around the world.
Barshefsky recently announced that she would conduct an
out-of-cycle review to assess legislation enacted by the
Argentine Government on December 18, 1996 and assess any
further developments toward the protection of intellectual
property in Argentina. The Administration has now concluded
this review and determined that current IPR protections are
clearly inadequate.
In April 1996, at the time of the last annual special
301 review, Barshefsky placed Argentina back on the
"priority watch list" because the patent law and
accompanying implemented decree enacted by Argentina at that
time fell far short of adequate and effective protection and
failed to achieve earlier Argentine Government assurances.
This law provided that patent protection would not be
available for pharmaceutical products until November, 2000
and contained provisions inconsistent with the WTO's
Agreement on Trade-Related Aspects of Intellectual Property
Rights - known as the TRIPS Agreement.
Following the April, 1996 decision, the Government of
Argentina stated that it would attempt to address U.S. IPR
concerns by enacting legislation to protect health
registration data. Such scientific and technical data -
which must support claims of efficacy and safety of new
products - must be submitted by pharmaceutical innovators to
Health Ministries to obtain approval for marketing new
products. These data generally cost millions of dollars to
develop. Given these costs to innovators, many countries
prohibit competitors from relying upon such data when they
seek Health Ministry approval for the same pharmaceutical
product.
On December 18, just before the scheduled completion
date of USTR's out-of-cycle review, the Argentine Congress
passed legislation dealing with health registration data.
However, this legislation does not archive its stated
purpose. Specifically, the legislation does not prevent
competitors from relying upon the innovator's test data when
these rival firms seek marketing approval. On the contrary,
the new legislation specifically permits Argentine
competitors to rely upon such data that has been submitted
for registration in Argentina, the United States or in
certain other countries.
"We have seen some encouraging efforts on the part of
the Menem Administration to establish modern intellectual
property protection in Argentina," said Barshefsky.
"However, Argentina's resulting patent law and the new
legislation designed to protect test registration data fall
far short of this objective and fail to meet international
standards. The result is that U.S. pharmaceutical firms will
continue to see the fruits of their research and development
freely copied by Argentina's pharmaceutical industry. In
addition, Argentine pharmaceutical interests continue to
work aggressively to frustrate our efforts to achieve
improved intellectual property protection in other
countries. As a result, the United States will with draw 50
percent of the duty-free trade benefits otherwise available
to Argentina under the U.S. GSP program."
The administration is issuing a Federal Register Notice
requesting public comment within 30 days outlining which
Argentine products would be proposed for exclusion from GSP
treatment. The Administration will publish on or about March
1 the final list of Argentine products that will lose GSP
duty-free treatment.