UN patents agency out of control and unsupervised, watchdog says

EDITOR’S NOTE:  See bottom of this story for an update.

EXCLUSIVE: The United Nations agency that acts as international gatekeeper for the Western world’s intellectual property is administratively out of control and has reached the point where “it is not prudent or advisable to maintain the status quo,” according to a U.N. study of the organization that is still being kept secret.

According to the study, the Geneva-based World Intellectual Property Organization, or WIPO, doesn’t have the oversight mechanisms of other U.N. agencies, spends more on its rapidly growing bureaucracy than on many of its goals,  fails to coordinate the work of its various branches, and keeps member-states that supposedly control it in the dark about its top officials’ meetings.

Most notably, perhaps, the study notes that WIPO’s failings have led to a situation where its bureaucracy and especially its director general -- a controversial Australian named Francis Gurry -- were "placed in a position to take the leading role on numerous issues, without a formal input from member states.”

That bland statement is the sole, oblique reference to a number of actions by Gurry, who took office in 2008, that have sent shockwaves through WIPO in the past several years -- and also through the U.S. State Department, which takes a special interest in WIPO’s doings, since the U.S. is the largest contributor by far to the trove of patents and other intellectual property that WIPO grants access to in the rest of the world.

These have included Gurry’s decision to transfer sensitive computer technology to North Korea and Iran in 2012 without notifying the U.N., which maintains sanctions against the regimes for their illegal nuclear weapons programs; other Gurry decisions last year to open new offices for his organization in Russia and China without member-states’ approval; and charges from a top WIPO official that Gurry ordered break-ins of the offices of his own staffers in 2008 to seek DNA evidence that they wrote anonymous letters against him. Gurry has denied the charges as “without foundation.”

Despite those controversies, Gurry has been re-nominated for a second term as WIPO’s director general, a decision that must be ratified at a two-day meeting of the organization’s 187-member General Assembly that starts on Thursday. (Both Iran and North Korea, as well as the U.S., Russia and China, are members of the WIPO Coordinating Committee that passed on Gurry’s re-nomination.)

The study examining the failings of Gurry’s organization was done by members of the U.N.’s Joint Inspection Unit, or JIU, a unique, Geneva-based panel of experts that is mandated to look at administrative and other issues across the entire constellation of U.N. funds, agencies and programs.

A draft copy of the document, “Review of Management and Administration in the World Intellectual Property Organization,” which was produced by two JIU inspectors and vetted by all 11 of the experts, was examined by Fox News.

The exact status of the JIU study itself is something of a mystery on a par with the inner workings of WIPO. It was initially scheduled for production and publication in 2013, as part of JIU’s slated “program of work,” and the research was apparently done in that year. At the time that the JIU scheduled the study, it declared that WIPO “had never been subject to a full management and administration review.”

But then the schedule began to slide -- it was scheduled for completion, according to JIU’s latest program of work, for “early in 2014”-- and it now appears highly unlikely that the document will appear before Gurry’s re-election as WIPO director general is complete. Among other things, no JIU study is considered final until it has been transmitted to the management of the U.N. organization involved for study and response.

When asked by Fox News whether WIPO  had gotten a finalized version of this  particular study, a WIPO press spokesman said that it had not yet been received.

That is not altogether surprising, insofar as according to the draft JIU study itself, repeated previous attempts at reform at WIPO -- or even efforts to understand how the complicated and disjointed agency works, “have achieved limited results.”

Part of that comes out of the origins of WIPO itself, which only became a U.N. “specialized agency” in 1974, but existed in a welter of previous forms since 1893.

Most of its responsibilities have been built around implementing a growing number of treaties on access to intellectual property. The most important of them now is the international Patent Cooperation Treaty, which offers patent protection and garners tens of millions in fees annually for providing access to patents in 148 countries.

(The official who brought the most recent charges against Gurry concerning office break-ins was James Pooley, one of Gurry’s four deputies, who heads the Information and Technology branch of WIPO, which administers this treaty.)

But WIPO’s activities have been further complicated by its adoption in 2007 of a new Development Agenda, which aims to funnel increased access to intellectual property to developing nations -- an aim that has increasingly become enmeshed in the post-2015 push for a radical new green economy that now infuses the entire U.N. system.

In that agenda, the issue of transferring and distributing access to patents and other forms of IP to developing countries in the battle against “climate change” has a central role -- and clashes between developed and developing countries within WIPO about how to organize and coordinate the agency have been a major factor, the study says, in keeping it a mess.

That clash is one reason, the study observes, that WIPO, “in contrast to most of the U.N. specialized agencies,” does not have a supervising executive board or council, made up of a rotating minority of its member states, “overseeing the work of the Secretariat on a continuous basis.”

Nor do the inspectors see much hope of getting such a thing:  that option “seems too controversial at present to have a chance to be adopted.” Instead, the JIU watchdogs suggest that other WIPO committees be adapted to “exercise more regular and effective oversight and guidance.”

The lack of oversight and hodge-podge organization has other results, the inspectors note, including a major difficulty in getting a handle on WIPO’s spending and priorities. Among other things, they note dryly that a 2007 study underlined that WIPO’s culture as an organization is “not performance oriented.”

One result is that 64 percent of WIPO’s spending goes on personnel:  more than 1,200 employees as of July 2013, when the biennial budget of the organization was about $768 million. Indeed, the study notes that “the management and administration of WIPO still consumes more resources than seven of WIPO’s strategic goals combined, relative to substantive activities.”

Moreover, despite ostensible management attempts at austerity, the study notes, WIPO’s spending is still rising fast. The agency’s planned budget for this year and next sees a personnel cost increase of nearly two-thirds. The report labels this a “disturbing fact, considering that WIPO member states have repeatedly requested the WIPO Secretariat to limit the growth of staffing expenditures.”

The headstrong approach of WIPO’s bureaucrats on spending is apparently not that different from their attitude toward member states in all kinds of matters.

The study documents that WIPO’s member states complain that relevant documents are often dumped on them at short notice, and some aren’t marked for archiving and retrieval. Terms of reference don’t exist for a number of WIPO groups and committees.  Recommendations by auditors and other financial overseers often don’t get implemented, or are ignored.

Most importantly, perhaps, is the huge amount of discretion that all the information and oversight gaps -- the report discreetly calls them an “insufficiency of regular guidance mechanisms”-- have currently given to Director General Gurry (who is never mentioned by name).

Rather than report to formal oversight bodies, the director general instead holds informal meetings and breakfasts with various ambassadors to glean their opinions for his organization, and meantime holds the meetings of his own top lieutenants under close wraps: no minutes are taken during the meetings.

Such “informal tools” have gained “disproportionate weight in the WIPO context,” the study observes, and have served “as a substitute modality for proper guidance, often at the expense of transparency.”

All of these methods, the report declares, “have reached the limits of their utility.” What WIPO needs instead is “in-depth discussions by the member states through the formal and clearly established channels.”

Whether that will happen in the continuing era of the current director general is an issue that the draft report does not address.

George Russell is editor-at-large of Fox News and can be found on Twitter @GeorgeRussell

EDITOR’S NOTE:  Several  hours after this story appeared, the U.N.’s Joint Inspection Unit  published the finalized version of its report .