Archive for March 16th, 2011

EU Report Says CETA IP Provisions Would Increase Consumer Prices, Royalty Deficit

The European Commission has commissioned a study on the likely economic effects of the proposed Canada – EU Trade Agreement.  The report includes a detailed analysis on the likely effects of the intellectual property provisions in the agreement.  According to the report, those provisions – which come largely as a result of EU demands – would result in more dollars flowing out of Canada and in increased Canadian consumer prices. Moreover, the report acknowledges that the incremental IP reforms are unlikely to increase spending on research and development.  It notes:

Most scientific studies “fail to find evidence of a strong positive response by domestic innovators that could be reasonably ascribed to the effect of stronger IPR.” To clarify, it is undisputable that R&D spending is associated with higher GDP growth and, given current business models, a certain level of IPR protection is essential for investment in innovation and creativity. Incremental IPR reforms in OECD countries, however, do not seem to increase domestic spending in R&D. Some stakeholders interviewed for this study and several academics consider that excessive IPR could actually harm economic growth, even in OECD countries, if their holders can block follow‐on research.

As for the costs of the CETA IP provisions, the report notes that more dollars will flow to Europe, but Canadian IP holders would not see increased revenue flow back.  In fact, it is Canadian consumers that will pay the price with “inflationary pressure” on consumer prices:

Read more ›

March 16, 2011 6 comments News