What We Won In ACTA

The Office of the United States Trade Representative (USTR) reports that Australia, Canada, Japan, Korea, Morocco, New Zealand, Singapore, and the United States signed the Anti-Counterfeiting Trade Agreement (ACTA) this past weekend. Representatives of the European Union (EU), Mexico, and Switzerland were present, but did not sign the agreement. It appears that the EU has "not yet completed its internal procedures authorizing the signature". Neither have Mexico or Switzerland. The Europeans claim that EU's Council of Ministers has to authorize signature, and that that will only happen after ACTA is translated into all European languages.

Whether or not Europe and other ACTA countries will sign and then signal their approval for the treaty remains to be seen (more on the distinction between signature and approval below). The occasion of ACTA's signing, albeit by a fraction of the countries that negotiated it, is a good time to take stock of what effect our advocacy has had. While the ACTA process was shrouded in secrecy and placed us at an extreme disadvantage, the public interest, Internet and consumer electronics industries, exerted sufficient pressure and succeeded in making the final ACTA text much better than earlier leaks indicated. Here are some major improvements:

  • The provision that proposed to criminally punish ordinary users (think college kid downloading music) with fines, jail time, seizure of computers, etc., was significantly scaled back as the negotiation process moved on and finally eliminated in the final text.
  • The provision that required all ACTA countries to hold third parties, such as ISPs and consumer electronics manufacturers, liable for their customers' infringement was eliminated. This provision, as drafted, was inconsistent with U.S. law and would have required changes to this complex and evolving policy space.
  • The provision that required countries to institute safe harbors for ISPs from their customer's infringement was eliminated. While the idea of providing ISPs with a safe harbor is a good one and facilitates the development of platforms and services on the Internet, the way in which ACTA would have required these safe harbors was not good. It lacked safe guards for users that are contained in U.S. law. Further, it could have provided the excuse for measures such as three strikes and deep packet inspection.
  • The DRM provisions of ACTA were improved significantly. Earlier leaked drafts had called upon countries to prevent circumvention of DRM, treat them as both civil and criminal offenses, and consider them illegal even when there was no underlying attempt to infringe copyright. Furthermore, these drafts had not acknowledged that circumvention could be done for lawful purposes. The final text overcomes these deficiencies and gives countries flexibility in how they implement DRM provisions.

Yet, many concerns remain with the current ACTA text. The text still requires countries to institute a system of statutory damages or its equivalent. We have written about the dangers of statutory damages many times before. The system was designed in an analog world, where infringements generally did not span many works. However, in the Internet era, where a single song downloaded can count as one work infringed, and ordinary people can download multiple works, statutory damages can escalate easily. Case in point: Joel Tennebaum, who was ordered to pay $675,000 in damages for downloading 30 songs. In addition to exposing ordinary infringers to fines out of proportion to the wrong they committed, statutory damages chills innovation because it prevents reliance on fair use.

In addition to the statutory damages provisions, ACTA also calls for extensive seizure and forfeiture provisions covering everything from infringing goods to assets whose value equals assets derived from infringement. (I am not kidding).

While the substantive improvements in text are a major victory, equally significant are the victories that do not relate to the text of the agreement. First, public interest representatives and technology companies were able to demonstrate that they were stakeholders whose views could not be ignored. Similarly, ordinary citizens became much more engaged with the process than they had been with earlier IP agreements.

Yet the question remains whether we can capitalize on these gains and influence policy in future. If the Transpacific Partnership Agreement (TPP) negotiations are any indication, we seem to have lost our edge. Perhaps the fact that ACTA was a stand-alone IP agreement worked to our advantage. The TPP, on the other hand, is a trade agreement that covers a diverse range of issues including textiles, telecommunications, agriculture, etc. It is easy for our concerns about unbalanced intellectual property provisions to get lost among other priorities as countries trade concessions in one chapter for stronger IP rules. Think of how controversial provisions often manage to pass Congress because they get buried in the must pass omnibus bills.

So what happens next? With respect to ACTA, the agreement requires that in addition to signing it, at least six countries indicate their approval to be bound by it. This is done by depositing "an instrument of ratification, acceptance, or approval" with the government of Japan. Then the agreement comes into force for those six countries. As I said before, Australia, Canada, Japan, Korea, Morocco, New Zealand, Singapore, and the United States have only signed the agreement. It is unclear whether all of these countries have deposited their instruments of ratification, acceptance, or approval. Earlier reports had indicated that although New Zealand would sign the agrement, it had to go through further processes to indicate its willingness to be finally bound by ACTA. Similarly, it has been reported that the Australian parliament would have to approve ACTA before Australia could ratify it.

Meanwhile, the TPP negotiations continue, in complete secrecy.

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