European Free Trade Association (EFTA)

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India has rejected the demand of the four-nation European Free Trade Association (EFTA) for ‘data exclusivity’ provisions in the free trade agreement that both sides are negotiating.

About European Free Trade Association

  • It is an intergovernmental organisation established in 1960 by the Stockholm Convention.
  • Objective: Promotes free trade and economic integration between its members within Europe and globally.
  • Member Countries: Iceland, Liechtenstein, Norway, and Switzerland.
  • The members of this organization are all open, competitive economies committed to the progressive liberalisation of trade in the multinational arena as well as in free trade agreements. 
  • In contrast to the European Union (EU), it is not a customs union. 
  • Governance
    • Its highest governing body is the EFTA Council. It generally meets 8 times a year at the ambassadorial level and twice a year at the ministerial level.
    • EFTA Surveillance Authority (ESA): It monitors compliance with European Economic Area (EEA) rules in Iceland, Liechtenstein and Norway. 
    • EFTA Court: It is based in Luxembourg and has the competence and authority to settle internal and external disputes regarding the implementation, application or interpretation of the EEA agreement.
    • The headquarters of the EFTA Secretariat is located in Geneva. It assists the EFTA Council in the management of relations between the 4 EFTA States and deals with the negotiation and operation of EFTA’s FTAs.

What is India’s concern?

  • Data exclusivity provisions will bar generic drug producers from using data of preclinical tests and clinical trials of former patent holders.
  • If generic medicine makers wish to introduce their version of an off-patent drug then they will have to either generate their own clinical data or wait for the exclusivity period to end.

Q1) What is a customs union?

It is an agreement between two or more countries to remove trade barriers and lower or eliminate tariffs. Members of a customs union generally apply a common external tariff on imports from non-member countries.

Source: India rejects EFTA’s data exclusivity demand in trade pact talks