On 16th June 2020, the Panel Report in Saudi Arabia- Measures concerning the Protection of Intellectual Property Rights (DS567) was circulated. In light of the rising concern in the sports fraternity over piracy in Saudi Arabia, this WTO Panel Report has been welcomed by various sports (particularly soccer) bodies. This decision is also an important one, keeping in mind the severed relations between Qatar and the other Gulf countries. It is also an important decision since it serves as a reminder of the extraordinary nature of the ‘National Security’ exception.
The dispute relates to the piracy theft done by beoutQ, a broadcasting entity in Saudi Arabia, and Saudi Arabia’s inaction/passive condonation of the same. beoutQ is involved in the unauthorized distribution and streaming of media licensed to beIN, a Qatari broadcasting channel. beoutQ is a play on the name of ‘beIN’, and stands for ‘be out Qatar.’ beoutQ provides access to 10 beIN sports channels, replacing beIN’s logo with its own. It further also started retail sale of beoutQ set top boxes, which receive satellite broadcast of pirated content. beoutQ also generates revenue through the sale of advertising slots on its pirated channels.
The various ‘acts and omissions’ of the Saudi Arabian Government have been brought to light by Qatar:
Qatar also alleged that Saudi Arabia has condoned beoutQ by failing to apply criminal procedures and penalties against beoutQ, and by actively promoting public gatherings with screenings of beoutQ’s unauthorized broadcasts during the 2018 World Cup matches.
On the above factual matrix, Qatar made its claims on the following four grounds:
Qatari nationals are unable to protect their IP in Saudi Arabia owing to the measures mentioned above;
Qatari nationals are accorded with a treatment less favourable than that accorded to Saudi Arabia’s own nationals;
Qatari nationals do not have access to civil judicial remedies to enforce their IPR; and
Saudi Arabia has failed to prosecute, as a criminal violation, piracy on a commercial scale performed by beoutQ.
The Panel analyzed the claims made by Qatar under Part I, II and III of the TRIPS Agreement in the following manner:
Saudi Arabia invoked the security exception in Article 73(b)(iii) of the TRIPS, due to the existence of an ‘emergency in international relations’ between the parties. This was, of course, with reference to the severance of all ties between Qatar and Saudi Arabia. Saudi Arabia stated ‘essential security interests’ especially with regard to extremism and terrorism.
The Panel observed that since the wording of Article 73(b)(iii) of the TRIPS is identical to the that of the GATT, the interpretation provided by the Panel in Russia- Traffic in Transit can be extended to the present situation as well. The Panel provided an analytical framework to guide the assessment of whether the national security exception can be invoked:
The two main measures in question with regard to this analysis were the anti-sympathy measures and the failure of Saudi Arabia to prosecute beoutQ. The following analysis was made in this regard:
The Panel acknowledged that the conflict between Qatar and Saudi Arabia is undisputed, and fulfills the first criteria squarely;
The measures were held to have been ‘taken in time of war or other emergency in international relations’
Saudi Arabia listed ‘essential security interests’ to be the ‘protection of its territory and its population from external threats, and the maintenance of law and public order internally’. Panel concluded that Saudi Arabia’s articulation of its security interests was sufficient to enable a causal link assessment.
Lastly and most importantly, it must be noted that there is a very low threshold to be met in order to meet the fourth criteria. The Panel held that the anti-sympathy measures ‘meet a minimum requirement of plausibility in relation to the preoffered essential security interests’. However, there was no link between Saudi Arabia’s inaction against beoutQ and the national security interests. National Security exception was granted for claims made under Article 42 and 41.1, but not for the claims made under Article 61.
The final conclusion was as follows:
Therefore, while Saudi Arabia's anti-sympathy measures were found to be inconsistent with Article 42 and 41.1, they were protected under the National Security Exception. The minimum threshold with regard to establishing a link between the measure and the security interests tends to dilute the extraordinary nature of the national security exceptions. However, the rejection of the national security claim for Article 61 is definitely a welcome move. If countries continue to use the national security exception liberally, trade is bound to suffer. As stated by DDG Wolff recently, trade and peace are intimately related.