The NIEO 2.0?, by Susan K. Sell
Sam Halabi’s Intellectual Property and the New International Economic Order offers an original take on seemingly disparate efforts by developing countries to push back against overly strong intellectual property rules and the oligopoly power of intellectual property-intensive firms. He revisits the 1970s and 1980s debates over a New International Economic Order (NIEO) that reflected keen awareness of the colonial past and demands to redistribute wealth from North to South. The NIEO called for greater regulation of multinational corporations to promote economic development through technology transfer and investment requirements that would fuel local capacity building through training programs and local component sourcing. The Global South made these demands in the context of (what seemed to be at the time) rising commodity power through OPEC’s price hikes and the push for import-substituting industrialization. Rapid industrialization and “catching up” framed some of these demands.
Halabi argues that the NIEO’s core was about regulating corporations and redistributing wealth. In this interpretation he finds substantial continuity between the earlier calls for an NIEO and the emergence of what he refers to as “intellectual property shelters”. While there were important pre-cursors toward supranational regulation of corporations, e.g., the 1981 World Health Organization/UNICEF International Code of Marketing Breastmilk Substitutes, there has been a turn away from the 1970s focus on rapid imitative industrialization to emphasizing basic human needs. Halabi focuses on institutional innovations in health, agriculture, and educational materials that seek to reclaim policy space to address human development.
While trade and investment agreements including intellectual property provisions and the globalization of finance have fostered economic concentration and oligopoly power among intellectual property-reliant firms, Halabi suggests that this market concentration presents opportunities for supranational regulation. Regulators sought to tame earlier eras of “robber baron” capitalism through competition (antitrust) policy. Today, developing and middle-income countries are quietly taming abusive practices through intellectual property shelters. Examples include: the Convention on Biodiversity and the Nagoya Protocol, that regulate access to genetic material and traditional knowledge; the International Seed Treaty that preserves farmer’s rights to save and exchange seeds; the World Intellectual Property Organization’s Marrakesh Treaty on limitations and exceptions to copyright to facilitate access for the visually impaired; the WHO Framework Convention on Tobacco Control; and the WHO Pandemic Influenza Preparedness Framework. In each of these cases the supranational regulation pushes back against the assertion of intellectual property rights (patents, copyright and trademarks) to carve out policy space for regulation for human needs such as health, education and sustainable agriculture and reduced transfers of wealth from south to north.
Halabi paints a hopeful picture in which supranational regulation may buttress domestic regulatory capacity. The fact that the government of Uruguay was able to point to the WHO Framework Convention on Tobacco Control helped it to fortify its evidence-based claims in the Investor State Dispute Settlement case over plain packaging. These international or supranational regulatory instruments “have the substantial potential to implement the kind of oversight, at least in industries with small numbers of firms whose activities have a disproportionate effect on interests of low-income countries and their populations that the New International Economic Order always sought” (p. 216). As a political scientist always aware of asymmetrical power dynamics, I want to share Halabi’s optimistic perspective but understand that sustained and expanded success in these areas remains an uphill battle. There certainly is momentum today to fundamentally question the Investor State Dispute Settlement, system with numerous countries rejecting it and to try to better align international legal and economic regimes with the Sustainable Development Goals (see for example, the work of Columbia University’s Center for Sustainable Investment). Overall, Halabi’s is a welcome and important intervention in our understanding of oligopoly power, supranational regulation and intellectual property protection.
Susan K. Sell is a Professor at the School of Regulation and Global Governance of Australian National University
This post is part of a symposium reviewing Intellectual Property and the New International Economic Order: Oligopoly, Regulation, and Wealth Redistribution in the Global Knowledge Economy, a new book by Sam Halabi, Associate Professor at the University of Missouri School of Law and Scholar at the O’Neill Institute for National and Global Health Law at Georgetown University. All of the posts can be read here.