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As we've said before, negotiations over the Anti-Counterfeiting Trade Agreement (ACTA) should include input from the public, not just a handful of industry groups trying to shoehorn international public policy around their agenda. We're happy that the draft text of the agreement was officially released in April, that the European Parliament took a strong pro-transparency and pro-consumer stance, and that the office of the US Trade Representative, the executive-branch body negotiating for the United States, has made some overtures towards accepting public comments.
But today I'm writing on a slightly different topic: secondary liability, or holding one person responsible for the copyright-infringing behavior of another. As Rashmi and John have written, ACTA seeks to make big changes to other countries' laws by mandating secondary liability. And we're not the only ones worried about this: major industry groups on both sides of the Atlantic have weighed in against ACTA in a pair of letters.
The letters--one from a coalition of European trade associations representing ISPs, cable TV operators, Internet companies, and mobile communications companies; and one from a group of American Internet companies, ISPs, and telecom companies--raise many of the same concerns that we have, especially as relate to secondary liability, showing that sometimes we can be on the same page (despite our differences, say, with ISPs over net neutrality). So even if the USTR and the European Commission aren't overly concerned about the possible human cost of this trade agreement, they should be aware that there's real money at stake, and for more than just the companies that have been driving the discussion.
The industry letters point out problems that might affect not just today's major players, but the innovators and investors of the future as well. Without guarantees of statutory safe harbor, as currently provided under US law, why would anyone get into the ISP business if they'd be held liable for the contents of their users' communications? And where will the next killer web app come from? At the very least, it would cost companies quite a lot of money and effort if they were required to actively monitor everything that users sent over their networks or posted on their sites. (To say nothing about the obvious privacy concerns.) These costs would be passed along to the customers, translating to higher prices and fewer choices. That's not good for consumers, and it's not good for business.
As Harold notes, infringement questions aren't always simple and straightforward. An ISP or website operator faced with liability for what its users' actions would likely err on the "safe" side in close cases (and maybe even not-so-close cases---why take chances?). Lest you think institutionally-imposed self-censorship for fear of copyright liability is far-fetched, consider this study documenting the chilling effects on communications research imposed by "copyright ignorance and misunderstanding." There's no reason to think that ISPs and website operators wouldn't be at least as cautious as publishers and universities. The signatories of the European letter explicitly point out that increased ISP liability "would lead to the situation where ISPs, in order to avoid liability claims, would intervene even in cases where law enforcement would not have intervened."
Nobody's saying counterfeit goods, ACTA's ostensible target, aren't worth stopping. And it's true that domestic US law presently provides many of the protections we want. But the Internet isn't solely subject to a single country's laws. If our representatives are advancing an international agreement that requires signatories to have "civil remedies . . . in cases of third party liability" for copyright infringement, why shouldn't they advance an agreement requiring meaningful exceptions and limitations to third-party liability?
Even in the US, where we have decades of precedent on secondary liability, the doctrine is still unsettled. Maybe another country, starting from square one to comply with ACTA's requirements, could learn from our experience and come up with a better system. But as currently drafted, ACTA wouldn't prevent another country from enacting severe secondary liability provisions that allowed for no exceptions, not even the familiar "capable of substantial noninfringing uses" exception from the Betamax case. If we're going to ask other countries to change their laws and add new forms of liability, we should at least ask them to do it right.