Peter-Tobias Stoll, Jan Busche & Katrin Arend (eds), WTO—Trade-Related Aspects of Intellectual Property Rights.

© 2009 Koninklijke Brill NV. Printed in the Netherlands. pp. 159–167

Article 4
Most-Favoured Nation Treatment

With regard to the protection of intellectual property, any advantage, favour, privilege or
immunity granted by a Member to the nationals of any other country shall be accorded
immediately and unconditionally to the nationals of all other Members. Exempted from this
obligation are any advantage, favour, privilege or immunity accorded by a Member:
(a) deriving from international agreements on judicial assistance or law enforcement
of a general nature and not particularly confined to the protection of intellectual
property;
(b) granted in accordance with the provisions of the Berne Convention (1971) or the
Rome Convention authorizing that the treatment accorded be a function not of national
treatment but of the treatment accorded in another country;
(c) in respect of the rights of performers, producers of phonograms and broadcasting
organizations not provided under this Agreement;
(d) deriving from international agreements related to the protection of intellectual property
which entered into force prior to the entry into force of the WTO Agreement, pro-
vided that such agreements are notified to the Council for TRIPS and do not constitute
an arbitrary or unjustifiable discrimination against nationals of other Members.

Bibliography
P. C. Mavroidis, The General Agreement on Tariffs and Trade, 1995; K.-N. Pfeifer, Brainpower
and Trade: The Impact of TRIPS on Intellectual Property, GYIL 39 (1996), 100–133;
T. Einhorn, The Impact of the WTO Agreement on TRIPS (Trade-Related Aspects of
Intellectual Property Rights) on EC Law: A Challenge to Regionalism, Common Mkt. L.
Rev 35 (1998) 5, 1069–1099; C. Arup, The New World Trade Organization Agreements,
2000; Van den Bosche, The Law and Policy of the World Trade Organization, 2005.

Case Law
Panel Report, US—Section 211 Appropriations Act, WT/DS176/R; Appellate Body Report,
US—Section 211 Appropriations Act, WT/DS176/AB/R; Panel Report, EC—Trademarks and
Geographical Indications, WT/DS174/R, WT/DS290/R.

Cross References
Art. I GATT (1994); Art. II GATS; Art. 5 ECT; Art. 308 NAFTA.

Table of Contents
A. Introduction 1
I. Relevance of Most-Favoured Nation Treatment 1
II. Concept and Effects 5
B. The Most-Favoured Nation Treatment in the TRIPS Agreement 8
I. Content and Scope of Application 8
II. US-Section 221 Appropriations Act and EC—Trademarks and Geographical
Indications 10
III. Exceptions 12
1. International Agreements on Judicial Assistance or Law Enforcement
(Art. 4 lit. a) 13
2. Provisions of the Berne Convention (1971) or the Rome Convention
(Art. 4 lit. b) 15
3. Related Rights (Art. 4 lit. c) 16
4. International Agreements Prior to the Entry into Force of the WTO
Agreement (Art. 4 lit. d) 17

ELFRING & AREND

 160 part i: general provisions and basic principles

A. Introduction

I. Relevance of Most-Favoured Nation Treatment

1 The principle of most-favoured nation (MFN) treatment belongs to the
cornerstones of the development and liberalization efforts of the GATT.1
Together with the principle of national treatment, most-favoured nation
treatment serves to prevent discriminatory action and the reduction of trade
barriers as well as to open the Members’ internal markets.2
2 Hitherto, most-favoured nation treatment has been of no major signifi-
cance in multilateral treaties for the protection of intellectual
property rights.3 While MFN treatment is the driving force in reducing
barriers to market access in respect of trade in goods, the protection of
intellectual property rights is predominantly shaped by the principle of
national treatment and minimum standards. In order to prevent fraudulent
action and the misuse of rights, the standard of protection existent in a
Member is decisive for the protection of intellectual property.4
3 Given its intangible nature, intellectual property is globally accessible from
the time of its first publication. Market access conditions are usually irrel-
evant to its protection. Not until the gradual reduction of trade tariffs did
the so-called non-tariff barriers, including insufficient or excessive protection
of intellectual property gain importance. The incorporation of the MFN
principle traces the new political developments in the protection of intel-
lectual property in the TRIPS Agreement.
4 It is, in particular, the small- and medium-size industries which benefit
from the most-favoured nation principle. By means of MFN treatment,
they enjoy the same advantages as are granted in other Members.5 Thus,
those small- and medium-size industries favoured the inclusion of a MFN
provision in the TRIPS Agreement during the Uruguay Round.6 In fact,

1
US—Section 211 Appropriations Act, WT/DS176/AB/R, para. 297. See for the basic
principle and effects of MFN Treatment: Cottier, Aussenwirtschaft 47 (1992), 79, 94; Yusuf,
in: Correa & Yusuf (eds), 3, 16; See also Correa, 66; Flory, 33 et seq.; Matsushita & Schoenbaum
& Mavroidis, 201 et seq.; Mavroidis, 110 et seq.; Stoll & Schorkopf, Max Planck CWTL, Vol. 1,
119 et seq.; Van den Bosche, 309 et seq.
2
Flory, 177.
3
In contrast thereto many bilateral agreements on intelllectual property protection
concluded in the 19th century contain the principle of most-favoured nation treatment.
Gervais, paras 2.50 et seq.
4
Ibid.
5
For details and theoretical foundations of the MFN principle, see Stoll & Schorkopf, Max
Planck CWTL, Vol. 1, paras 119 et seq.
6
See, for instance, Negotiating Group on TRIPS, includiding Trade in Counterfeit
Goods, Guidelines proposed by the European Community, MTN.GNG/NG11/W/16, 20
November 1987. See also Ross & Wasserman, in: Stewart (ed.), 2271.

ELFRING & AREND