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“Even if there are economical differences between our countries, the mechanisms to evade and circumvent the law are in the end the same”

Dr. Carl Baudenbacher visited PUCP to give the keynote speech at the International Seminar “Temas de Derecho Internacional Económico e Integración vinculados al Derecho de la Competencia y la Propiedad Intelectual». This event was organized by the Master of Intellectual Property and Competition and the Master of International Economic Law

  • Carl Baudenbacher
    Presidente de la Corte de la Asociación Europea de Libre Comercio
  • Texto:
    Solange Avila
  • Fotografía:
    Alex Fernandez

What is the EFTA Court? Which countries are under its jurisdiction?

The EFTA Court has been set up as the court of those EFTA countries which participate in the Agreement on the European Economic Area (EEA). Originally, those were Sweden, Austria, Finland, Iceland and Norway. Some of them joined the European Union, and today three countries – Iceland, Liechtenstein and Norway – form the EEA’s EFTA-pillar. That means that my court consists of three judges. Plus there are six ad hoc judges. An ad-hoc judge replaces a judge if he or she is not able to sit in a particular case.

Three judges are the smallest number one can imagine to run an international court. To be small can, however, be beneficial. One tends to be fast and one knows each other. Allow me to remind you that cases are decided in the WTO and in American Federal Appellate courts, by the same number of judges.

What lessons can Latin America learn from the experiences in the European Economic Area?

I would like to highlight that I am not in a position to give recommendations. However, I am happy to tell you about the experiences we have made in the EEA. I think that the most important accomplishment of the European Economic Area Agreement is, first and foremost, the establishment of an EEA single market. We believe that markets are beneficial for all participants: entrepreneurs, consumers, workers, dealers, financial intermediaries, and investors.

Secondly, the institutions must be credible. And also my court must be credible. That means we have to create and maintain legal certainty, inter alia by sticking to precedent, so that entrepreneurs and other actors may reasonably well be able to predict, how a case may be decided. Moreover, it is crucial that a court is independent. Politicians and diplomats may have mixed feelings towards international courts and accuse judges of abusing their independence and of acting ultra vires without there being a reason. From what I understand, this may also be the reality in the Andean Community. But without independence, an international or supranational court cannot function.

You mentioned “attacks” directed towards your court. Are there any lessons to be learnt from the perspective of Mercosur and the Andean Community?

I can tell you what we experienced: We saw attempts by high-ranking officials to undermine our role. Let me add that also national judges made such attempts in the name of national sovereignty. However, we have been quite successful in overcoming what you labelled as “attacks”. That, I figure, may be something of interest for the Andean Community and Mercosur. At the same time, I’m here to learn myself and I had very fruitful meetings with representatives of the institutions of the Andean Community and other decision-makersFor exampleI had a very interesting exchange with the current President of the Peruvian Supreme Court and his delegation. Even if there are historical and economical differences between our countries, human beings are human beings and the mechanisms to evade and circumvent the law and to act in one’s own interest are in the end the same.

How does the EFTA Court deal with unfair competition in the European Economic Area?

Unfair competition law is one of the areas that has been harmonized to a certain extent in the European Economic Area and is now to be considered an area of European law. Therefore, we get cases involving unfair competition law issues and we give an interpretation on the relevant provisions. I’ll give you one example: Iceland and Hungary are the only countries where mortgage loans are indexed. If you take out such a loan, because you want to build a house, that may mean that your interest rates goes up because the inflation increases. In our cases we had to answer the question whether this practice is compatible with unfair competition law.

How can we promote and develop international intellectual property law here in Latin America and on which bases?

The answer to this question depends inter alia on the respective country’s legal set-up, on the legal history, and on the State’s economic situation. In international law, there exist various agreements that may be joined, such as the Madrid Protocol or trade agreements.

It is important for investors in Latin America that intellectual property rights are protected. That will lead them to invest in these countries. At the same time, one sees that the scope of protection sometimes goes too far. It is crucial to find the right balance between the granting of monopoly rights and protecting free competition.

Sometimes, the legislatures have gone too far and provide for protection of the most trivial business patents. That cannot be beneficial for an economy. And then there are those companies that require all the protection as possible. However, monopolies for inventions cannot be granted for an unlimited period of time. They must come to end one day. You cannot monopolize an invention forever.

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