Anti-counterfeiting trade pact ‘99 percent’ complete
Bridges Weekly Trade News Digest | 7 October 2010
Anti-counterfeiting trade pact ‘99 percent’ complete
Talks on a controversial “Anti-Counterfeiting Trade Agreement” are very nearly complete, following what participating nations described as the “final” round of negotiations in Tokyo last week.
A draft text of the agreement as it stood at the end of those talks, dated 2 October, was publicly released Wednesday, and placed on the websites of many of the participating governments. It showed that the close to 40 mostly developed country participants had managed to resolve their disagreements on all but a small handful of issues.
An EU official close to the negotiations said that the text was over 99 percent agreed, and that officials would be able to iron out remaining differences “through e-mail contact” in the weeks to come. No more rounds of negotiations would be needed, the official said, describing the process as “really at the final stage, about to cross the finishing line.”
“This work represents a significant victory for those who care about protecting and enforcing intellectual property rights,” said US Trade Representative Ron Kirk, in a statement. He called for a quick conclusion of the negotiations.
The ACTA talks have been contentious since their launch in 2007. Even some supporters of the prospective treaty’s goals were perturbed by the near-total secrecy that surrounded the negotiations at first — a secrecy that stood in sharp contrast to other inter-governmental negotiations. Snippets that periodically leaked from the discussions caused critics to worry that participants were going well beyond what was necessary to target counterfeiting and piracy and risked creating new intellectual property protections that would undermine multilateral institutions like the WTO and WIPO, threaten internet freedom, impede access to technology, and jeopardise shipments of affordable medicines between poor countries.
Many — though not all — of these fears have been alleviated to a significant extent, as countries watered down provisions in order to reach a compromise (see BRIDGES Weekly, 8 September 2010). According to Michael Geist, a law professor at the University of Ottawa who is an expert on ACTA, US negotiators have been willing to agree to “almost anything” in order to conclude a deal before November’s Congressional elections. On internet piracy and digital lock issues, the US has gone from seeking harsh new rules to settling for what Geist now calls “ACTA Ultra-Lite.”
Safe harbours smaller, penalties steeper than under TRIPS
But the current text’s provisions for public interest safeguards are still weaker than those in WTO intellectual property rules and the domestic laws of many countries, said James Love, of Knowledge Ecology International. Meanwhile, penalties are more stringent, since there are fewer curbs on rights-holders’ ability to seek redress. “They’ve shrunken the safe harbours and jacked up the damages,” Love told Bridges.
For example, he said that the WTO Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS) had broad safeguards that could potentially protect the cross-border transfer of copyrighted works in made accessible to the blind without the consent of the rights-holder. However, the ACTA draft had no comparable provisions pertaining to the exhaustion of intellectual property rights (TRIPS Article 6) or anti-competitive practices (TRIPS Article 40).
In the case of injunctions, Love said, while US law provides cases where damages are zero or limited for certain kinds of infringers — surgeons and generic drug makers in cases when the rights-holders have failed to disclose all of the patents necessary to make a particular product — the ACTA text contains no such exceptions. (Notably, the US would like to see patents excluded from the chapter on ‘Civil Enforcement’; this difference on the scope of that chapter is one of the unresolved issues in the text).
While the TRIPS agreement provides for intellectual property right infringers to be ordered by judicial authorities to compensate rights-holders for the injury and legal costs, the ACTA draft gives rights-holders a say in determining the amount of damages, with one possible baseline the “suggested retail price,” not just the going market rate.
Patents excluded from border measures
One major change in the text should go some way to easing fears that international shipments of legal generic drugs might be seized when in transit through ACTA parties where the drugs are patent-protected: patents have been excluded from the ACTA draft’s chapter on border measures. This means the patent-holder of a drug under patent in the EU but not India would have no recourse under ACTA to petition Dutch customs authorities to seize generic versions en route from India to Brazil.
However, Sean Flynn, associate director of the programme on information justice and intellectual property at American University’s Washington College of Law, warned that this did not mean that generic drug shipments were entirely safe from ACTA. Border measures still apply to copyrights and trademarks. Last year, German customs officials seized a shipment of amoxicillin, a generic antibiotic, on its way to Vanuatu, on suspicion of a trademark violation. They did not release until nearly a month later, when GlaxoSmithKline, maker of the Amoxil brand of the antibiotic, confirmed that there had in fact been no trademark violation (see BRIDGES Weekly, 10 June 2009).
Compromises enabled speedy conclusion
In the early days of the ACTA negotiations, many observers feared that it would result in new requirements making internet service providers liable for copyright infringements carried out by subscribers. Some raised the spectre of an agreement that would require border guards to search iPods and laptops for illicit music or movies.
The current draft would do neither. Parties “may” require internet service providers to tell right-holders about subscribers suspected of infringement - but they are not required to do so. Similarly, they have the right to exclude non-commercial quantities of goods in travellers’ personal luggage from the scope of border measures.
Governments might still choose to implement ‘three strikes and you’re out’ laws for internet service providers, or introduce draconian border controls, but it would not be because of ACTA.
Professor Geist wrote on his blog that the new draft’s provisions aimed at preventing the circumvention of digital locks afford parties considerable flexibility in how to implement them. These provisions, he said, were a far cry from the US’s original goal of replicating its own strict digital copyright laws at the international level.
Participants also managed to converge very substantially on the scope of the agreement - something on which they disagreed as recently as August. The US, with support from countries including Canada, New Zealand, and Mexico, had wanted the accord to focus on copyright and trademarks. But it will now cover all types of intellectual property, including patents and geographical indications, as sought by the EU, backed by Switzerland and Japan.
The text provides for parties to create an ‘ACTA Committee’ upon the conclusion of negotiations. The committee would make decisions by consensus, and be responsible for overseeing the implementation and functioning of the agreement. The text does not provide for an independent dispute settlement mechanism; an earlier proposal had called for one, prompting concerns about marginalising multilateral fora. The ACTA Committee is empowered to determine terms of accession for each country that applies to join in the future. Once the negotiations are concluded, there will be a two-year window for participating countries to sign the agreement. The agreement is to enter force either based on an agreement among countries that have ratified, or 30 days after the deposit of the sixth instrument of ratification.
Governments participating in the ACTA negotiations (including EU member states) are Australia, Austria, Belgium, Bulgaria, Canada, Cyprus, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Japan, Korea, Latvia, Lithuania, Luxembourg, Malta, Mexico, Morocco, the Netherlands, New Zealand, Poland, Portugal, Romania, Singapore, Slovakia, Slovenia, Spain, Sweden, Switzerland, the United Kingdom, the United States, and the European Union.
ICTSD reporting
