LibertyVoice

Freedom and internet

ALDE Hearing on ACTA in Brussels

Earlier this month, I had the opportunity to participate in a hearing on ACTA in Brussels sponsored by Members of the European Parliament Alexander Alvaro and Marietje Schaake.  Other participants included Luc Devigne, the head of the European ACTA delegation, and representatives from eBay and EuroISPA.  The full video of the hearing is posted below.  My presentation begins just after the 5:00 minute mark.

Kenya Constitutional Court Blocks Anti-Counterfeiting Law

The Constitutional Court of Kenya has blocked the government from implementing that country's Anti-Counterfeiting Act as it applies to generic medicines.  The law has been challenged as unconstitutional on the grounds that it endangers lives by arbitrarily denying access to affordable generic medications.

DFAIT Posts French Language Version of ACTA

The Canadian government has posted a French language version of ACTA.  An English version was widely circulated earlier this week, but Canada may have taken the initiative to have it translated.

ACTA Analysis Across the Web

There is lots of coverage of ACTA in the wake of the official release of the draft text.  Notable comments include:

ACTA Draft Text Released: (Nearly) Same As It Ever Was

As the ACTA negotiating countries promised, a draft consolidated text was released earlier today.  Unlike the earlier leaked version which provided specific attribution to country positions, this official version has removed references to those positions, so the text does not state who supports which version of the text.  Those interested in deciphering that bigger picture, should look at the official release alongside the leaked version (text version here).

While there is still considerable disagreement – lots of square brackets indicating areas where the text has not achieved consensus – the countries did make some progress last week in New Zealand. There will be another round of negotiations in June in Switzerland, followed by at least two more rounds in the fall.  The target remains the end of 2010 to conclude a deal, but there will still need to be considerable compromise.  Moreover, the continuing position of the U.S. and E.U. that they will not change their domestic laws will have to change since there are too many inconsistencies for both to be right.

Today's release marks an important development that highlights the value of public pressure.  As politicians and the public demanded greater transparency, the negotiating countries presumably concluded that the issue was becoming a major impediment to concluding an agreement and decided to make it available (the fact that it was already leaked and that the countries standing in the way of transparency were publicly identified were undoubtedly additional considerations).  Moreover, the benefits of public pressure can also be seen in parts of the text.  The near-consensus on a de minimis provision – which was not even included in the initial proposals – reflects a desire to address concerns around personal searches at the border.  Similarly, the removal of the U.S. footnote on graduated response may also reflect public concern and pressure.

Public pressure has helped make ACTA marginally better, but the release of text confirms many of the fears regarding the substance of the treaty.  As discussed below, it would require dramatic changes to many domestic laws with new requirements on statutory damages, injunctions, anti-circumvention rules, and ISP safe harbours.  Many of these provisions are substantive copyright rules, not limited to counterfeiting (as the title of the treaty suggests) nor enforcement (as sometimes claimed). 

Moreover, the institutional issues around ACTA remain a huge concern.  This is explicitly an attempt to circumvent WIPO and the more open, transparent, and inclusive international process.  The implications are very significant for all countries as this undermines the ability for many countries to have their concerns heard.  Instead, many will face demands to comply with a treaty from which they were completely excluded during the negotiation process.

Full analysis of the updated consolidated text will take some time, but a few quick comments on key issues in the text.

The Internet Chapter

The Internet chapter has attracted the most amount of attention in the press and online.  Note that there are still lots of square brackets, including on basic issues such as the scope of the provisions (disagreement over to include patents) and on some issues whether the provisions are required or recommended (ie. shall or may).

ISP Safe Harbour/Liability

The key provision – and the most contentious – is the ISP safe harbour provision.  At the moment, there is even disagreement over whether it is a requirement or recommendation.  There are also several options on the table, with the U.S., EU, and Japan all tabling proposed language.

i.    Three Strikes/Graduated Response

This has been one of the hot button issues and countries have tried to counter concerns by arguing that there is no mandatory three strikes provisions within ACTA.  That is true.  In fact, the footnote proposed by the U.S. which envisioned three strikes as a model policy for ISPs has been removed from the consolidation (the footnote now only notes that one country – likely Japan – would like language confirming that its national law complies with the ACTA provision).  This indicates that the U.S. has dropped the reference to three strikes from its proposed language on ISP liability.

However, that does not mean that three strikes has disappeared from the draft entirely.  The U.S. proposal for ISP liability is one of three options currently being considered.  The European option preserves, but does not require, three strikes:

Paragraph 3(a) shall not affect the possibility for a judicial or administrative authority, in accordance with the Parties legal system, requiring the service provider to terminate or prevent an infringement, nor does it affect the possibility of the parties establishing procedures governing the removal or disabling of access to information

The EU will argue this is consistent with the law in a few of its member states.  If the approach is adopted, it will clearly keep three strikes on the table and could be used in other ACTA member countries to encourage its adoption.  Note that Japan has offered a third alternative which involves the development of codes of conduct between rights holders and ISPs.

ii.    Notice and Takedown

ACTA still contains a notice-and-takedown requirement for ISPs to qualify for a safe harbour.  That is inconsistent with Canadian law, which has no such requirement and has twice proposed a notice-and-notice system.  Notice-and-notice has been used effectively for many years in Canada.

Anti-Circumvention Legislation

The anti-circumvention provisions continue to mark a renegotiation of the WIPO Internet treaties by mandating the implementation of the DMCA.  The provision calls for adequate and effective legal protection for technological protection measures (much like WIPO), but then requires provisions against devices that can be used to circumvent and some countries want the provision to extend to access controls (neither in WIPO).  There are still considerable square brackets on this provision, but the direction is clear – limit the flexibility that exists under international law for the protection of TPMs.

Civil Enforcement Chapter

The countries still disagree on scope – some want it extended to all IP rights, others limited to copyright and trademark.  The proposed language still includes broad injunction powers and requires the establishment of statutory damages, something not found in many ACTA countries. Moreover, Canada and New Zealand appear to dropped their request for the following limiting language:

For greater certainty, a Party may limit or exclude damages in certain special cases.

The statutory damages provision still includes disagreement over whether it is required (U.S. and Japan) or optional (EU, Canada, New Zealand). 

There is much more here – analysis to follow.

Border Measures Chapter

There is still disagreement on scope as the EU wants the option to extend to all IP, others want it limited to copyright and trademark. There was major progress in New Zealand on the de minimis provision, which is designed to address fears of iPod searching border guards.  Prior drafts contained several proposals.  The current consolidation reflects near consensus:

Parties may exclude from the application of this Section small quantities of goods of a non-commercial nature contained in travelers’ personal luggage [or sent in small consignments.]

There are still broad disclosure and information sharing requirements within the chapter.

Criminal Enforcement Chapter

The chapter still targets both commercial infringement and cases of non-commercial "wilfull" infringement.  This section illustrates the downside of removing attribution from the text.  The leaked consolidation showed many variable proposals.  The new text simply places everything in square brackets and does not flesh out the different proposed language.

The EU proposal to include "inciting, aiding, and abetting" also remains in the text, in square brackets.  Proposals to target labels and camcording in theatres remain in the text.

Other Chapters

ACTA contains many other chapters on institutional issues, capacity building, international cooperation, and more.  A quick scan suggests those chapters remain unchanged.  They were not on the New Zealand agenda.

AP on ACTA

The Associated Press has a story on ACTA and the growing concern from the technology community with the agreement.

U.S. Government Study: Counterfeiting and Piracy Data Unreliable

For several years, I have written about the lack of reliability of data on counterfeiting.  The RCMP cited data without any factual basis, while other groups regularly made claims without support, such as reports from the Ontario Chamber of Commerce and the Conference Board of Canada.  Of course, this phenomenon was not limited to Canada.  The US Patent and Trademark Office relied on the same data to claim 7 – 8 % of world trade is counterfeit, while a report from the first Global Congress on Counterfeiting, which led to ACTA, pointed to FBI data it said showed counterfeiting at US$200 – 250 billion per year.

This week a report from the U.S. Government Accountability Office concludes that estimates such as these are not reliable and cannot be substantiated to a data source.  The U.S. GAO was required by Congress to try to quantify the impact of counterfeit and pirated goods.  While concluding that counterfeiting exists and is a problem, the GAO could not find reliable data.  Its review of commonly cited claims:


Three commonly cited estimates of U.S. industry losses due to counterfeiting have been sourced to U.S. agencies, but cannot be substantiated or traced back to an underlying data source or methodology. First, a number of industry, media, and government publications have cited an FBI estimate that U.S. businesses lose $200-$250 billion to counterfeiting on an annual basis. This estimate was contained in a 2002 FBI press release, but FBI officials told us that it has no record of source data or methodology for generating the estimate and that it cannot be corroborated.

Second, a 2002 CBP press release contained an estimate that U.S. businesses and industries lose $200 billion a year in revenue and 750,000 jobs due to counterfeits of merchandise. However, a CBP official stated that these figures are of uncertain origin, have been discredited, and are no longer used by CBP. A March 2009 CBP internal memo was circulated to inform staff not to use the figures. However, another entity within DHS continues to use them.

Third, the Motor and Equipment Manufacturers Association reported an estimate that the U.S. automotive parts industry has lost $3 billion in sales due to counterfeit goods and attributed the figure to the Federal Trade Commission (FTC). The OECD has also referenced this estimate in its report on counterfeiting and piracy, citing the association report that is sourced to the FTC. However, when we contacted FTC officials to substantiate the estimate, they were unable to locate any record or source of this estimate within its reports or archives, and officials could not recall the agency ever developing or using this estimate. These estimates attributed to FBI, CBP, and FTC continue to be referenced by various industry and government sources as evidence of the significance of the counterfeiting and piracy problem to the U.S. economy.

While the report is unlikely to stem the tide of unsubstantiated claims, it is important to recognize that independent analysis from the U.S. government has now concluded what many have been maintaining for some time – the case against counterfeiting continues to suffer from an absence of hard, reliable data.

Consumer Electronics Association on ACTA

Consumer Electronics Association head Gary Shapiro writes on ACTA, warning that it is the most dangerous global trade agreement you've never heard of.

The Truth About ACTA: My PublicACTA Keynote Address

As I posted over the weekend, I had the pleasure of participating in the PublicACTA conference in Wellington, New Zealand.  The Wellington Declaration is a must-read, as is the extensive media coverage that ACTA has received over the past 48 hours in New Zealand (NZ PC World, National Business Review, IT News, ComputerWorld NZ, NZ Herald).  The last few days have provided a model for how those concerned with ACTA should become engaged with future rounds of talks.

For those looking for up-to-date information on ACTA, my column this week (Toronto Star version, homepage version) previews the New Zealand talks, noting the pressure points on transparency and substance of the treaty.

Even better, all the videos from the PublicACTA conference can accessed online.  I have embedded my talk below. It provides a primer on the background of ACTA, reasons for concern, and a brief comment on what can be done.  An MP3 version of the same talk can be downloaded here.

U.S.: No ACTA Transparency Unless Other Countries Cave on Substance

The U.S. Trade Representative issued a release just prior to the launch of the New Zealand round of ACTA negotiations that has left no doubt that the U.S. is the biggest barrier to official release of the ACTA text.  The full text of the release is couched in terms of improving transparency, but is really a thinly-veiled shot at the European Union's public demands for release of the text.  The U.S. statement:

"In this upcoming round of ACTA negotiations, the U.S. delegation will be working with other delegations to resolve some fundamental issues, such as the scope of the intellectual property rights that are the focus of this agreement.  Progress is necessary so that we can prepare to release a text that will provide meaningful information to the public and be a basis for productive dialogue.  We hope that enough progress is made in New Zealand in clearing brackets from the text so that participants can be in a position to reach a consensus on sharing a meaningful text with the public."

Note what the U.S. is actually saying – resolving scope of the treaty (the E.U. is seeking a broader scope that includes patents) and removing square brackets (the sources of disagreement) is needed to reach consensus on sharing text with the public.  Yet there is no reason to link ACTA transparency with the substance of the treaty.  The text of the treaty can be released without regard for the level of agreement on substantive issues.  Yet unlike most other ACTA countries that have called for transparency without condition, the U.S. has set conditions that effectively seeks to trade its willingness to release the text for gains on the substance of the text.  The only thing needed to reach consensus on sharing the text with the public is for the U.S. to give the go-ahead.  This statement indicates they will only do so for a price.

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