ACTA Draft Stokes Controversy as Talks Resume in New Zealand

14 April 2010

As negotiators gather in New Zealand this week for the eighth round of negotiations toward an Anti-Counterfeiting Trade Agreement (ACTA), several civil society groups are scaling up their concerns of the scope and possible effects of some of the provisions under negotiation.

Though countries negotiating the agreement have refused to release the negotiating text despite repeated demands by civil society groups, a leaked full draft text of ACTA appeared in late March on the website of La Quadrature du Net, a French digital rights group that opposes the prospective treaty. The 56-page document details the proposals made by the different countries in the negotiations.

While in many aspects, the text still reflects diverging views among the participants - which include major economies like the EU, the US, Japan, Canada, New Zealand, Australia, Switzerland and Mexico, as well as a handful of developing nations - the wide scope of the agreement and its implications appear to confirm speculations that, if agreed, ACTA would become a significant landmark in the global intellectual property and enforcement landscape.

Indeed, the draft agreement seeks to strengthen the legal framework for the enforcement of intellectual property rights (IPRs), addressing a number of issues for which "an international legal framework does not exist or needs to be strengthened," in the words of the participants. It builds upon efforts and policies that industrialised countries, particularly the US and EU, have pursued for a number of years in their domestic legislation and in free trade agreements. Norm setting areas included in ACTA's scope include civil enforcement, criminal enforcement, border measures and IPRs enforcement in the digital environment. Government enforcement practices -- methods used by authorities to apply legal norms - also figure in the draft agreement, as do measures concerning international cooperation, technical assistance and institutional arrangements.

According to a joint paper written by ACTA parties hoping to "clarify" the objectives of the agreement and summarise "key elements" under discussion, the intended focus of the proposed deal is on "counterfeiting and piracy activities that significantly affect commercial interests, rather than on the activities of ordinary citizens."

The paper emphasises that the agreement is not intended to interfere "with a signatory's ability to respect its citizens' fundamental rights and civil liberties," and it stresses that the deal will be consistent with WTO rules and declarations on intellectual property and public health.  Remedies in the context of IPRs enforcement in the digital environment are specified to be without prejudice to "the availability of exceptions and limitations."

Civil society organisations, particularly in the US and EU, have rebuffed such affirmations. Before the beginning of the eighth round of negotiations, participants at a public ACTA conference in New Zealand adopted a "Wellington Declaration" that encapsulates many civil society concerns regarding possible future ACTA provisions.

Public health groups such as Health Action International (HAI) have expressed concern that some provisions currently under discussion could hinder access to medicines, especially in the developing world. HAI fears that "injunctions, storage fees and information requirements" imposed on alleged infringers of the agreement could make it difficult for generic manufacturers to compete, "The same holds true for criminal and financial penalties for patent violations that hold manufacturers of active pharmaceutical ingredients (APIs) liable," the group added. The inclusion of border measures in the scope of the ACTA agreement has also been a source of concern, in view of recent detentions of generic medicines in transit, particularly in the EU.

Meanwhile, digital rights activists such as Philippe Aigrain and Michael Geist worry about how ACTA provisions might restrict access to knowledge and curtail users' rights in the digital environment. According to Geist, the combined effect of ACTA provisions under negotiation in this area would "dramatically reshape Canadian copyright law and eliminate sovereign choice on domestic copyright policy."

Aigrain is particularly critical of European negotiators, who he claims are pushing criminal sanctions in ACTA that are "offensive to fundamental rights and go well beyond existing EU law." While EU officials have denied that provisions for cutting off internet access for serial copyright infringers were part of the negotiations, ACTA provisions on internet service providers' liability still raise many questions in this regard. According to the Wellington Declaration "disconnection, account suspension, or limitation of service, have disproportionately negative consequences for civil rights." In relation to assertions that the "intended focus" of ACTA is on counterfeiting and piracy activities taking place on "a commercial scale," Aigrain argues that ACTA would represent "an unprecedented step in extending the interpretation of ‘commercial scale' as including activities without motivation for financial gain."

A precise definition of "commercial scale" has long eluded IP negotiators. The WTO's Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement) uses the term but does not elaborate it. In the WTO dispute the US initiated against China at the WTO on IPRs enforcement, the WTO panel, in its 2009 report, did not accept US views of what constituted "commercial scale" IP  infringement in the Chinese marketplace. In this regard, the Wellington Declaration emphasises "that ACTA must not attempt to reframe personal use and private acts to fit a definition of ‘commercial' infringement." ACTA, it adds, "must recognise the need for proportionate criminal provisions acknowledging the problem of large-scale commercial infringement, for profit, that is direct and intentional."

In early April, James Love of Knowledge Ecology International (KEI), a Washington and Geneva-based NGO, issued a research note on ACTA provisions on injunctions and damages that details how the proposed language in ACTA would require changes in US laws and laws of other countries.

According to the note, examples include injunctions in cases of "innocent infringement" -- when the alleged violator was not aware of breaking any rules -- and "statutory exceptions" to injunctions allowed by TRIPS article 44.2. According to this article, governments may limit injunctions in cases of "use by governments, or by third parties authorised by a government" or "where these remedies are inconsistent with a Member's law." According to KEI, the US and European ACTA proposals for injunctions "do not allow the flexibilities" spelled out in the above-mentioned TRIPS article.

Countries participating in the ACTA negotiations point out that many of the most controversial issues are still open and that the final outcome is not yet known. ACTA proposals on issues like damages and IPRs enforcement in the digital environment remain highly bracketed, reflecting significant divergences among negotiating parties. In the case of damages and border measures, disagreement also prevails on whether ACTA provisions addressing these issues should apply to infringements of all IPRs or solely copyright piracy and trademark counterfeiting.

While ACTA negotiations will proceed beyond the current round of negotiations, they are likely to remain controversial as secrecy will continue to fuel speculations and mobilise civil society about the possible contents of a future agreement.

ICTSD reporting.

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