TRIPs: The Impact of Intellectual Property Rights on Global Trade

When you buy a generic medicine at a fraction of the branded price, plant a crop from saved seeds, or watch a court reject a patent on a centuries-old home remedy, you are seeing the effects of one international agreement at work. The Agreement on Trade-Related Aspects of Intellectual Property Rights, better known as TRIPS, quietly shapes who owns ideas, who can copy them, and at what cost. It is one of the most consequential treaties of the modern trading system, and its consequences fall unevenly across rich and poor nations. Understanding how it works explains a great deal about debates over affordable drugs, seed sovereignty, and the protection of indigenous knowledge.

What TRIPS is and why it exists 🔗

TRIPS is an international agreement administered by the World Trade Organization that sets minimum standards for protecting intellectual property across member countries. It came into effect on 1 January 1995 and remains the most comprehensive multilateral agreement on intellectual property to date. Before TRIPS, countries set their own rules with little coordination. The agreement changed that by tying intellectual property protection directly to membership in the global trading system.

This linkage matters. Joining the WTO is a package deal, meaning members cannot pick and choose which agreements to accept. To trade freely under WTO rules, a country must also accept TRIPS and bring its national laws in line with it. This is what gave the agreement its teeth and forced sweeping legal reforms in many developing nations, including India.

The areas TRIPS covers 🔗

The agreement sets minimum standards across several distinct forms of intellectual property. Knowing the categories helps clarify how broadly it reaches:

Copyright and related rights: Protection for literary and artistic works, along with the rights of performers, producers of sound recordings, and broadcasting organisations.

Trademarks: Signs and symbols that distinguish goods and services, including service marks.

Geographical indications: Names that identify a product as coming from a specific place with qualities tied to that origin, such as Darjeeling tea or Basmati rice.

Patents: Exclusive rights for inventions, with a minimum protection term of 20 years, covering products and processes across nearly all fields of technology.

Industrial designs, integrated circuit layouts, and undisclosed information: Protection for the visual design of products, semiconductor chip designs, and trade secrets with commercial value.

For each category, TRIPS defines what must be protected, the rights granted, permitted exceptions, and the minimum duration of protection. It also builds on older treaties like the Paris and Berne Conventions, which is why some call it a “Berne and Paris-plus” agreement.

Why developing countries pushed back 🔗

The promise behind strong intellectual property protection is that it rewards innovation. Patents give inventors exclusive rights so they can recover the costs of research and development. The difficulty is that most patents are held by firms in wealthy nations, while the costs of higher prices are felt most sharply in poorer ones. For Third World countries, TRIPS raised serious concerns in three areas: healthcare, agriculture, and access to technology.

The healthcare problem 🔗

The sharpest conflict has been over medicines. A 20-year patent allows a pharmaceutical company to sell a drug without competition, keeping prices high. For life-saving treatments, this can put medicines out of reach for millions. The tension came to a head over the HIV/AIDS crisis, when patented antiretroviral drugs were priced far beyond what patients in developing countries could afford.

Before TRIPS, India did not grant patents on pharmaceutical products, only on the processes used to make them. This allowed Indian companies to reverse-engineer cheaper versions of drugs and build a powerful generic medicine industry, earning the country its reputation as the “pharmacy of the developing world.” TRIPS forced India to introduce product patents through amendments to its Patents Act, completed in 2005. The fear was that this would shut down the generic competition that kept prices low.

Agriculture and seeds 🔗

The second concern was agriculture. Article 27.3(b) of TRIPS requires members to protect new plant varieties, either through patents, an effective sui generis system, or a combination of both. For a country where the majority of the population depends on farming, and where farmers have saved and exchanged seeds for generations, patenting seeds threatened a way of life. The worry was that commercial seed companies could gain monopoly control over varieties that farmers had effectively helped develop over centuries.

Access to technology 🔗

The third concern was broader. Stronger intellectual property rules can slow the transfer of technology to developing nations by making it more expensive to license or imitate. Critics argued that TRIPS locked in the advantage of countries that already held most of the world’s patents, while raising the cost of catching up for everyone else.

Patents on life forms and traditional knowledge 🔗

One of the most contentious areas TRIPS opened up is the patenting of biological materials. When patent systems began accepting claims over genes, plants, and traditional remedies, developing countries found their own heritage being claimed as private property by foreign corporations. This practice acquired a name: biopiracy.

Biopiracy refers to the unauthorised appropriation of biological resources or traditional knowledge, typically through patents, without consent or fair compensation to the communities that originally held the knowledge. Three Indian cases became global landmarks.

Turmeric, neem, and basmati 🔗

Turmeric: In 1995, the US Patent and Trademark Office granted a patent for using turmeric to heal wounds, a remedy Indian households had used for generations. The Council of Scientific and Industrial Research challenged it by producing ancient Sanskrit and Urdu references proving the knowledge was not new. The patent was revoked for lacking novelty.

Neem: The European Patent Office granted a patent in 1994 to a US corporation for a fungus-control method using neem oil, despite neem having been used as a natural pesticide in India for centuries. After a long legal struggle, the patent was revoked in 2000.

Basmati: A US company obtained a patent involving rice lines with characteristics similar to Indian Basmati, raising fears that Indian and Pakistani farmers could lose the right to market their own rice under that name.

These cases exposed a deep mismatch. Traditional knowledge is collective, passed down orally over generations, and has no single inventor. Patent law rewards novelty and a clear inventor, so traditional knowledge fails to qualify for protection while remaining vulnerable to being patented by others.

India’s response: documenting heritage 🔗

The turmeric and neem battles were expensive and slow. Fighting a single wrongly granted patent could take years and enormous sums. India’s answer was the Traditional Knowledge Digital Library, a database that records ancient texts on Ayurveda, Siddha, Unani, and Yoga and translates them into several international languages. Patent examiners abroad can now check applications against this record, allowing India to block wrongful patents at the application stage rather than fighting costly battles after the fact.

Flexibilities, controversies, and the fight for balance 🔗

TRIPS is not entirely one-sided. The agreement contains built-in flexibilities that allow governments to limit intellectual property rights in the public interest. The struggle has been over how freely countries can actually use them.

The Doha Declaration on public health 🔗

In 2001, WTO members adopted the Doha Declaration on the TRIPS Agreement and Public Health. It affirmed that TRIPS does not and should not prevent members from taking measures to protect public health, and that the agreement should be interpreted to support access to medicines for all. The declaration confirmed that each member has the right to grant compulsory licences and to decide the grounds for granting them. It also recognised that public health crises, including epidemics like HIV/AIDS, tuberculosis, and malaria, can count as national emergencies.

Compulsory licensing in practice 🔗

A compulsory licence allows a government to permit a third party to produce a patented product without the patent holder’s consent, usually in exchange for a reasonable royalty. India’s most famous use of this came in 2012, when the Patent Office granted its first compulsory licence to Natco Pharma for Bayer’s cancer drug Nexavar. Bayer had been selling a month’s supply for around ₹2.8 lakh, far beyond the reach of most patients. Under the licence, Natco was allowed to sell its version for roughly ₹8,800 a month, with Bayer receiving a 7% royalty. The decision reinforced the principle that patents must serve the public interest, not merely commercial gain.

A practical limitation remained. Compulsory licensing was originally meant mainly to supply the domestic market, which left countries with little or no manufacturing capacity unable to benefit. The Doha process led to an amendment to TRIPS, eventually made permanent through Article 31bis, allowing the export of generic medicines made under compulsory licence to countries that cannot manufacture their own.

Section 3(d) and the Novartis case 🔗

India also used its lawmaking freedom to limit a practice known as evergreening, where companies extend monopolies by making minor modifications to existing drugs and patenting them again. Section 3(d) of the Indian Patents Act requires that a new form of a known substance show enhanced therapeutic efficacy to qualify for a patent. In the landmark Novartis v. Union of India case, the Supreme Court denied a patent on a modified form of the cancer drug Gleevec, ruling that it did not meet this standard. The judgment protected the space for affordable generics and became a global reference point for how a developing country can comply with TRIPS while defending public health.

A tailored approach to seeds 🔗

For agriculture, India chose the sui generis route allowed under Article 27.3(b) rather than patenting plants. The Protection of Plant Varieties and Farmers’ Rights Act of 2001 protects commercial breeders while also recognising the contributions of farmers. It preserves the traditional right of farmers to save, use, exchange, and sell seeds. India rejected the breeder-focused UPOV model favoured by many developed countries, judging it ill-suited to a nation of small farmers. The law is often described as one of the few in the world to combine breeders’ rights with explicit protection for farmers’ traditional practices.

The balance that TRIPS continues to test 🔗

TRIPS reflects a permanent tension. Strong intellectual property rules can reward innovation and attract investment, but they can also raise the price of medicines, seeds, and technology in the countries least able to pay. The agreement’s flexibilities, including compulsory licensing, public health safeguards, and the freedom to design tailored laws, are the tools developing nations use to push back. India’s experience shows that these tools can work, but only when a country has the legal capacity and political will to use them. The debate over who should own knowledge, and at what price, is far from settled.

What do you think? Should life-saving medicines and the seeds farmers depend on ever be treated as private property protected by patents? And where would you draw the line between rewarding genuine innovation and protecting the public’s right to affordable access?

References

1. https://www.wto.org/english/tratop_e/trips_e/intel2_e.htm
2. https://www.uspto.gov/ip-policy/patent-policy/trade-related-aspects-ip-rights
3. https://en.wikipedia.org/wiki/TRIPS_Agreement
4. https://www.managingip.com/article/2a5bqtj8ume32iwlaqcpr/emergence-of-plant-variety-protection-in-india
5. https://en.wikipedia.org/wiki/Traditional_Knowledge_Digital_Library
6. https://www.hg.org/legal-articles/india-traditional-knowledge-and-patents-in-light-of-basmati-rice-neem-turmeric-and-golden-rice-57383
7. https://blog.ipleaders.in/bio-piracy-of-traditional-knowledge/
8. https://www.mondaq.com/india/patent/586384/traditional-knowledge-and-patent-issues-an-overview-of-turmeric-basmati-neem-cases
9. https://www.wto.org/english/tratop_e/trips_e/pharmpatent_e.htm
10. https://www.rkdewan.com/blogs/compulsory-licensing-under-indian-patent-act/
11. https://en.wikipedia.org/wiki/Doha_Declaration_on_the_TRIPS_agreement_and_public_health
12. https://blog.ipleaders.in/the-patents-act-1970-case-analysis-novartis-ag-v-union-of-india/
13. https://lawbhoomi.com/plant-variety-protection-and-farmers-rights-act/