Consumer Welfare:

The role of consumer welfare in international trade has been emphasized by several organizations such as the UNCTAD. Whilst intellectual property (IP) and competition law pursue the common aim of improving consumer welfare the interplay between the two presents a distinct dilemma. Competition law restricts activities that obstruct fair competition, IP law grants legal monopoly rights. Competition law attempts to promote innovative markets by maintaining competition. Consumer welfare is considered maximized where competitors strive to produce new, better and more affordable products. In contrast, IP law attempts to encourage investment in innovation by granting an exclusive legal right to exploit, guaranteeing the IP owner a chance of remuneration free from the burden of direct competition. Consumer welfare depends both on competition and innovation. Competition law must therefore balance the benefits of patents and competition. The UNCTAD has realized the importance of consumer welfare in international trade and several studies have been made on the Competition Policy and Consumer Protection Branch of UNCTAD. On the COMPAL project, that aims at strengthening capacities and institutions in the areas of competition and consumer protection policies in Latin America, various studies are planned for completion in the first quarter 2010. Future studies will include analysis of anti-competitive practices in sensitive sectors, including those that may register changes as a result of participation in regional agreements, in Colombia, Nicaragua and Peru and analysis of competition conditions in strategic markets at national and international levels in El Salvador. UNCTAD played a major role in supporting the country draft and adopt a Consumer Protection Bill that will be enacted soon. UNCTAD will be providing support to a study mapping the state of competition in the Republic of Madagascar in 2010 within a project funded by the United Nations Development Program (UNDP), after the enactment of a competition law by the country in 2008.