ASEAN INTEGRATION & INTELLECTUAL PROPERTY RIGHTS

ASEAN ECONOMIC INTEGRATION – HOW DOES IT AFFECT THE PHILIPPINE INTELLECTUAL PROPERTY RIGHTS?

         Intellectual property (IP) is an intangible and a distinct type of an asset that a person can own, sell, transfer, license, register or even give away at his own discretion. This is borne from people’s imaginative minds, creativity and innovation. The need for its protection and in order to secure the creativity of individual, leads to the establishment of IP Offices throughout the world. Protection of intellectual property rights (IPRs) stimulates further creativity and innovation, which in turn spur progress in industries and ultimately leads to national development. It is also a legal concept, referring to exclusive rights that are given to persons over the creations of their respective minds, specifically, the rights over the use of the owner’s creation for a certain period of time, which includes patents, trademarks and copyright.¹

          

         The Association of Southeast Asian Nations (ASEAN) is an economic and political organization, which has been the lead and source of the regional economic cooperation and integration among developing countries in the South East. It was established on August 8, 1967 in Bangkok, Thailand, under the ASEAN Declaration (also known as the Bangkok Declaration) by the five founding member countries of Indonesia, Malaysia, Philippines, Singapore and Thailand.  The said five original members welcomed Brunei in 1984, Vietnam in 1995, Laos and Myanmar in 1997, and Cambodia in 1999. ASEAN is located in a dynamic part of Southeast Asia encompassing a total land area of approximately 4.44 million square kilometers, a population of around 600 million and a combined GDP (2011) of about USD 1.8 trillion.² The ASEAN region comprises mainly of developing countries with varying levels of political, social, cultural, economic, and technological development.  Its aims include accelerating economic growth, social progress, socio-cultural among its members, protection of regional peace and stability, and opportunities for member countries to discuss differences peacefully and amicably.

It has implemented several economic cooperation policies within the region since 1976. The new goal is the establishment of the ASEAN Community that consists of three pillars: ASEAN Political-Security Community, ASEAN Economic Community, and ASEAN Socio-Cultural Community. Since ASEAN has also been an important axis of regional economic cooperation and free trade agreements (FTA) in Asia and Pacific’s. A big step toward realization of ASEAN Community is the Southeast Asia regional economic integration into ASEAN Economic Community (AEC) within 2015.³

The succeeding step is the establishment of the ASEAN Economic Community (AEC), including AFTA, with main objectives to create a: single market and production base, highly competitive economic region, region of equitable economic development, region fully integrated into the global economy. In January 2007, the ten (10) Southeast Asian nations agreed to implement the ASEAN Economic Community (AEC) by 2015 which since 2007, the ASEAN countries gradually lower their import duties among them and targeted will be zero for most of the import duties at 2015. And Since 2011, AEC has agreed to strengthen the position and increase the competitive edges of small and medium enterprises (SME) in the ASEAN region. The ASEAN Economic Community (AEC) is one of the three ASEAN Community Councils. Its goal is to seek regional economic integration by 2015.  The areas of cooperation include: human resources development and capacity building, recognition of professional qualifications, consultation on economic and financial polices, trade financing, infrastructure and communications connectivity, electronic transactions through e-ASEAN, industrial integration to promote regional sourcing, enhancing private sector involvement for the building of AEC. In short, the AEC will transform ASEAN into a region with free movement of goods, services, investment, skilled labor, and freer flow of capital.⁴

From ASEAN to AEC

Principal Initiatives of the AEC Blueprint⁵

Core Elements	Actions
A. Single Market and Production Base
1. Goods	• Eliminate duties, non-tariff barriers • Simplify rules of origin • Trade facilitation, customs integration, single window • Harmonize standards and regulations
2. Services	• Remove restrictions on service trade • Allow at least 70% equity participation • Schedule commitments • Extend mutual recognition agreements, liberalize financial services
3. Investment	Investment protection, facilitation, promotion, liberalization • Non-discrimination, national treatment
4. Capital	• Harmonize regulations • Promote cross-border capital raising
5. Labor	• Facilitate movement of skilled and professional labor in cross-border trade  • Enhance movement of students  • Work toward harmonizing qualifications
6. Priority Sectors	• Projects in priority sectors
7. Food Agriculture, forestry	• Harmonize best practices, sanitary and phytosanitary measures, safety and quality standards, chemical use, regulation of products derived from biotechnology • Promote technology transfer
B. Competitive Economic Region
1. Competition Policy	• Lower goods non-policy develop regional networks and guidelines
2. Consumer Protection	• Develop regional networks and guidelines
3. Intellectual Property Rights	• Implement ASEAN Intellectual Property Rights Action Plan • Promote regional cooperation
4. Infrastructure	• Facilitate multimodal transport • Complete Singapore-Kunming rail link • Integrated Maritime Transport, open sky policies, single aviation market • High-speed information technology interconnections  • ASEAN power grid, gas pipeline
5. Taxation	• Complete bilateral agreements
6. E-commerce	• Adopt best practices and harmonize legal infrastructure
C. Equitable Economic Development
1. SMEs	• ASEAN Blueprint of best practices
2. Initiatives for integration	• Technical assistance and capacity building in low-income countries
D. Integration in to the Global Economy
1. Coherent Approach	• Review free trade area commitments • Establish coordination and possibly common external approaches
2. Supply networks	• International best practices and standards • Technical assistance

         Intellectual property rights (IPRs) affect international trade flows when such knowledge-intensive goods move across national boundaries.  The importance of IPRs for trade has gained more significance as the share of knowledge-intensive or high technology products in total world trade has doubled. At the international level, IPRs have traditionally been governed by several conventions – most prominently the Paris Convention for patents and trademarks and the Berne Convention for copyright – that are administered by the World Intellectual Property Organization (WIPO). It is territorial in jurisdiction, which are created by its respective national laws and differ from one country to another. For example, if intellectual property is embedded in goods and services originating in one country that crosses to another country, two questions arise.  First, how will IPRs protection in country B affect the magnitude of the bilateral trade flow from country A to B? Second, what are the implications of such protection on economic welfare of both countries A and B?

        In principle, intellectual property (IP) policy serve as a powerful stimulus to (a) cultural, intellectual and artistic creativity; (b) efficient adoption and adaptation of more advanced technologies; (c) continuous learning to meet the ever-rising threshold of performance expectations; and (d) commercialization. IP policy can also help to incubate a vibrant culture of creativity and invention, and to ensure more equitable access and benefits to all stakeholders in both traditional and newer IPRs.  Furthermore, IP policy can influence both the volume and quality of external trade and investment and the transfers of advanced, proprietary technologies. IP creativity is a major determinant of local value added and external competitiveness. Regional cooperation in IPR has been guided by the ASEAN IPR Action Plan 2011-2015 and the Work Plan for ASEAN Cooperation on Copyrights which aim to develop a culture of learning and innovation supported by a friendlier IP profile to businesses, investors, inventors and creators in ASEAN.  In addition, these Plans are also designed to foster better public awareness, coordination and networking, predictability, capacity building, and contribution of IP industries to competitiveness and development.

        

         With the increased recognition of IPRs as a powerful tool for nation building, the need to improve, protect, and promote the creativity of ASEAN nationals to secure the future of the region and promote economic integration has become an urgent issue on hand.  At the same time, ASEAN also recognizes that to encourage foreign direct investments in the region, it needs to ensure the protection and enforcement of IPRs of trading partners. Over the past several years, ASEAN has been working towards the development of the IP system in the region through the ASEAN Working Group on Intellectual Property Cooperation (AWGIPC).  The AWGIPC was established in 1996 pursuant to the ASEAN Framework Agreement on Intellectual Property Cooperation, which was signed by ASEAN Member States (AMSs) in Bangkok, Thailand, in 1995.  The AWGIPC is mandated to develop, coordinate, and implement all IP-related regional programmes and activities in ASEAN. The ASEAN IP model strives to create a conducive environment where IP can be utilized as one of the tools to promote regional integration, economic competitiveness, and development. The ASEAN Framework Agreement on Intellectual Property Cooperation and initiatives, together with inter-ASEAN cooperation with dialogue partners, have sought to enable its members to use IP for promoting regional integration, broad-based, inclusive economic and social development aimed at closing the development gap, eradicating poverty and maintaining sustainable development. A well-functioning regional IP system needs not only to formulate IP policies and set strategic goals, but also ensure their timely execution.⁶

ASEAN Influence to the Philippine Intellectual Property

        The Philippines has a long time of intellectual property protection in the ASEAN region, as introduced by the Spanish colonial power in the early 19th century even during the Martial Law regime, as well as on 1995 upon the adoption of a comprehensive intellectual property code following WIPO models. The Code covers patents, utility models, trademarks and geographical indications, copyright, industrial designs, layout designs of integrated circuits and undisclosed information. There is separate legislation providing for plant variety protection since 2002. 

        

        Intellectual Property Rights (IPR) is administered by the Intellectual Property Office of the Philippines (IPOPHL) by virtue of Republic Act (R.A.) No. 8293 that took effect in January 1998, otherwise known as the Intellectual Property Code of the Philippines. In particular, IPOPHIL is a separate, independent, and quasi-judicial organization under the Department of Trade and Industry (DTI), and is the lead agency responsible for handling the registration and conflict resolution of IPR. The office is composed of six bureaus: Bureau of Patents; Bureau of Trademarks; Bureau of Legal Affairs; Documentation, Information and Technology Transfer Bureau; Management Information System and EDP Bureau; and Administrative, Financial and Personnel Services Bureau. Previously, the IP system in the Philippines was directly administered by DTI through its Bureau of Trademarks, Patents and Technology Transfer. The establishment of IPOPHL as a separate, independent agency was a strong recognition of the importance of an effective and efficient IP system in the country’s push for economic development. During its early years, IPOPHL sought to modernize the administration of intellectual property in the Philippines particularly through computerization. From 2005, IPO endeavored to play a more active role in promoting the IP system of the country by undertaking a developmental approach to intellectual property. And it has accomplished much in terms of demystifying, and promoting appreciation and utilization of the country’s IP system over the past 10 years particularly through its various information dissemination campaigns. Singapore, Malaysia, Thailand, and Indonesia filed the most number of trademark applications in the Philippines, in that order. The move to full automate the country’s IP system will further enhance its effectiveness and efficiency, and hopefully make it user-friendlier particularly among SMEs.⁷

         Presently an amendment to the Intellectual Property Code⁸ was passed on February 28, 2013 to incorporate measures that will ensure the country’s compliance with its commitments under the WIPO Copyright Treaty and the WIPO Performances and Phonograms Treaty, collectively known as WIPO Internet Treaties. These amendments also provided for the creation of a Bureau of Copyright, and introduced the concepts of “technological measures” and “rights management information” as strategies to respond to the increasing incidence of internet piracy. Likewise, this new law also granted an exemption from securing permission from the publisher or copyright owner of the printed materials if the same are to be reproduced in a format for the exclusive use of the blind or visually impaired.

Accomplishments on IPR based from the Philippine Individual Action Plan Update 2012

• Established Arbitration and Mediation Units as alternative dispute resolution approach for IP cases.
• Established a pool of Innovation and Technology Support Offices (ITSOs) to strengthen the capacity of local institutions in accessing patent information and in using the patent system
• Commenced the Industrial Property Automation System (IPAS) as a component of the Integrated Intellectual Property Management System (IIPMS).  IPAS covers the end-to-end processing of patent, trademark, utility model, and industrial design applications.
• Strengthened IP enforcement and promotion of anti-counterfeiting initiatives by establishing partnerships with public and private institutions.   Memoranda of Agreement were signed with the Philippine Ports Authority (PPA), Manila International Airport Authority (MIAA), Securities and Exchange Commission, Philippine Economic Zone Authority, Anti-Money Laundering Council, and the Motorcycle Development Program of the Philippines Association.
• Enhanced enforcement capacity of government agencies by conducting trainings for the Department of Justice, Food and Drug Administration, PPA, MIAA, and other members of the National Committee on IPR.
• Revised the Implementing Rules and Regulations on Patents, Utility Models, and Industrial Designs to streamline procedures, clarify substantive matters, and accommodate emerging technologies such as computer-related inventions, biotechnology, and nanotechnology.
• Revised the Manual on Substantive Patent Examination Procedure in pursuant to Republic Act No. 9502 (Universally Accessible Cheaper and Quality Medicines Act of 2008).
• Amended the Implementing Rules and Regulations on Administrative Complaints for Intellectual Property Rights Violation.   

The future of IPR with the ASEAN Action Plan 2011-2015

          As ASEAN accelerated its economic integration from 2010 to 2015, a new IPR action plan⁹ had to be formulated to complement this goal and transform it into “an innovative and competitive region.” The 2011-2015 Action Plan is built on earlier ones, and seeks to further advance regional IP integration so as to ensure that ASEAN “remains an active player in the international IP community.” Deferring its earlier goal of designing a fully harmonized regional IP system with one set of IP laws, it adopted a more flexible IP cooperation model.  Such an approach enables its members to move forward collectively, but at varying paces in accordance with their developmental level and capacity.  Moreover, the 2011-2015 Action Plan emphasizes the intensification of cooperation in joint focused programs and activities with measurable outputs in selected areas.  Five strategic goals are highlighted – each led by specific ASEAN members with defined deliverables and timelines.  The goals are¹⁰:

1)    To Develop a Balanced IP System: The aim is to create an IP system that takes into account the varying levels of development of Member States and differences in the institutional capacity of national IP offices.  This will enable them to deliver timely, quality, and accessible IP services thereby promoting the region as one that is conducive to the needs of users and generators of IP. 

2)    To Enhance IP Infrastructure: The 2011-2015 Action Plan seeks to develop national or regional legal and policy infrastructures that will address the evolving demands of the IP landscape, as well as ASEAN member states’ participation in the global IP systems at appropriate times. 

3)    To Promote IP Creation, Awareness, and Utilization: This goal aims to advance the interests of the region through systematic promotion of IP creation, awareness, and utilization.  Objectives include ensuring that IP becomes a tool for innovation development and support for the transfer of technology to promote access to knowledge.  Moreover, due consideration is to be given for the preservation and protection of indigenous products and services, as well as, creative works.

         ASEAN continues to acknowledge the important role played by IP in social, technological, and economic progress and regional integration.  With this ASEAN IPR Action Plan 2011-2015, the AWGIPC has designed a unique approach toward regional cooperation which takes into account different levels of capacity of the Member States in development and integration, balances access to IP and protection of IPRs, and responds to the current needs and anticipates future demands of the global IP system.  

         The initiatives and deliverables identified under each of the five goals of this Action Plan will help AMSs meet the objectives of the AEC by transforming ASEAN into an innovative and competitive region through the use of IP for their nationals, and ensuring that the region remains an active participant in the international IP community and the world economy.  The strategic goals embody a higher level of regional cooperation with AMSs acting as champions for areas that will be more focused and with specific deliverables that will move the region closer to its goals of development and integration.  

     The AWGIPC will ensure ownership and accountability by AMSs, as well as heightened collaboration and strengthened linkages with internal and external ASEAN stakeholders, in the implementation of regional initiatives, programmes and projects.  This Action Plan thus can be expected to lay the foundation for the evolution of a regional brand and profile for an ASEAN IP System under the AEC

         Commercialization of the Intellectual Properties instead might be the possible effect of the ASEAN Integration because of having a single economic community between the ten (10) members of the group wherein there will be freer flow of trade that will absolutely affect the intangible assets of every nation. In this regard, we should protect our own intellectual, innovative, and creative minds by having more laws and fiscal projects that will support each conceptual Filipino and will further enhance more IP creation which are unique that will help in the nation-building. Support from the government and even the private sectors are very much needed in order to engage each and every individual for the culture building of IPR.

ENDNOTES:

   

[1] What are intellectual property rights? World Trade Organization website: http://www.wto.org/english/tratop_e/trips_e/intel1_e.htm

[2] SEAN Secretariat, Asean Community in Figures (ACIF) 2011, 1-16 (2011), available at http://www.asean.org/resources/publications/asean-publications/item/asean-community-in-figures-acif-2011-3. 

[3] ASEAN, 2007. ASEAN Economic Community Blueprint. Jakarta: ASEAN Secretariat.

[4] Ibid.

[5] Ibid. 

[6] ASEAN, ASEAN Framework Agreement on Intellectual Property Cooperation, available at http://www.asean.org/asean/asean-summit/item/asean-framework-agreement-on-intellectual-property-cooperation-bangkok-thailand-15-december-1995.

[7] http://www.ipophil.gov.ph.

[8] Republic Act (“R.A.”) No. 10372 – An Act Amending Certain Provisions of R.A. No. 8293.

[9] ASEAN Secretariat, ASEAN IPR Action Plan 2011-2015 (2011), available at http://www.asean.org/images/2012/Economic/sectoral_aem/service/agreement/ASEAN%20IPR%20Plan%202011-2015.pdf.

[10] Ibid. 

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