Tag Archives: TPP

ICYMI: New Advocacy and Public Policy Update

On May 19, 2017, ARL released its latest Advocacy and Public Policy Update. The topics covered in this update include various copyright issues (Register of Copyrights bill, Copyright Office study on moral rights, Copyright Office rulemaking on modernizing copyright recordation, and numerous amicus briefs filed), LSU v. Elsevier, appropriations, access to and preservation of government data, net neutrality, developments on trade agreements, and issues related to immigration and border control.  The full update is available here.

 

Access to Text Provides Meaningful Transparency

We’re taking part in Copyright Week, a series of actions and discussions supporting key principles that should guide copyright policy. Every day this week, various groups are taking on different elements of the law, and addressing what’s at stake, and what we need to do to make sure that copyright promotes creativity and innovation.

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Today’s theme is Transparency and Representation: Copyright policy must be set through a participatory, democratic, and transparent process. It should not be decided through back room deals, secret international agreements, or unilateral attempts to apply national laws extraterritorially.

Transparency is critical in understanding what laws may be created that will affect the public. For years, the United States has been involved in negotiated trade agreements in secret, without giving the public ample opportunity to make comments and engage in a meaningful way.  ARL has blogged about the concerns around the lack of transparency in trade negotiations many times in the past, noting that this is a primary failing of the negotiations of the Trans-Pacific Partnership Agreement (TPP), Trans-Atlantic Trade and Investment Partnership (TTIP) and other agreements, resulting in a lack of democratic process.  Although USTR has claimed transparency due to the opportunities to provide stakeholder presentations at various negotiations round, the secrecy of the negotiating texts and proposals made it impossible to actually give meaningful engagement.  Unlike the EU, for example, in the TTIP negotiations, USTR has not released draft textual proposals.

In 2016, ARL joined a coalition making critical recommendations for the United States Trade Representative Open Government Plan.

  1. Publish U.S. textual proposals on rules in ongoing international trade negotiations: USTR should immediately make available on its website the textual proposals related to rules that it has already tabled to its negotiating partners in the context of the TTIP, TiSA, and any other bilateral, regional, or multilateral trade negotiation it undertakes.
  2. Publish consolidated texts after each round of ongoing negotiations: USTR should impose as a prerequisite to any new or continuing trade negotiations that all parties agree to publish consolidated draft texts on rules after each negotiating round.
  3. Appoint a “transparency officer” who does not have structural conflicts of interest in promoting transparency at the agency.

These are the critical steps that USTR should take in negotiating trade agreements, whether the government is negotiating new agreements or, as President-elect Trump has promised to do, revisiting old agreements. The textual proposals are key to understanding what is being negotiated. While fact sheets may be useful, they are no substitute for the actual language of the texts which are highly technical and nuanced. As noted in ARL’s analysis of the final TPP text, there were significant improvements in the text from earlier proposals. Some of these improvements may have been made possible through the input of civil society and academics, but these comments were only possible due to access to leaked text.

Australian Productivity Commission Recommends Fair Use, Shorter Copyright Terms

On April 29, 2016, the Australian Productivity Commission issued a nearly 600 page draft report on Intellectual Property Arrangements recommending a number of positive changes to provide better balance to the intellectual property system, including recommendations on fair use, shorter copyright terms, and specifying that copyright licensing does not override limitations and exceptions for libraries and archives.

In the overview, while the Commission acknowledges the importance of incentivizing creation, the report also notes that

the use of an idea by one party does not reduce its capacity for use by another, and and that ideas provide economic and social value as other parties draw on existing knowledge to create their own.  Since new ideas are a major source of economic growth, any defects in IP arrangements intended to encourage their creation and diffusion can be very costly

[ . . .]

Indeed, overly strong restrictions on diffusion can be so detrimental to innovation that it can undo the benefits of the IP system in the first place . . .

The Commission begins a section entitled “Copy(not)right” by pointing out that “Australia’s copyright arrangements are weighed too heavily in favour of copyright owners, to the detriment of the long-term interests of both consumers and intermediate users.”  Much of the framework emphasizes balance and also recognizes the need for adaptability.

The Commission’s report also points out the importance of erring on the side of weaker IP protections because:

Recent experience would also tend to suggest that it is easier to extend IP rights than narrow them, especially where international agreements are concerned.  Given the asymmetric nature of how policy can be changed, the Commission considers it is appropriate “to err on the side of caution” where there is imperfect information, and deliberately set weaker parameters in the way that rights are assigned, used or enforced.  Extending rights should only occur after careful consideration of how such a change might affect future innovations, whether IP rights are the best way to drive the desired outcome, and how it might affect the greater number of consumers relative to producers of IP.

Ultimately, “the current Copyright Act is weighted too heavily in favor of copyright owners, to the detriment of the long-term interests of users.”

Fair Use

The Commission examines fair use and fair dealing exceptions and explains that Australia’s fair dealing exception provides a closed list of uses.  The US fair use approach, by contrast, relies on factors to determine whether the exception applies.  Thus, “In Australia, legislative change is required to expand the categories of use deemed to be fair.  In contrast, US courts have latitude to determine if, on the facts, a new use of copyright material is fair.  This allows the exception to be flexible and adaptive over time.”

The draft report includes a illustrative list of uses considered to be fair use in the US which would require a license in Australia, as it is not permitted by the current fair dealing provision.  These uses include: an internet search engine’s publication of thumbnail images in search results; an author’s quotation of unpublished letters in a biography; an artist’s collage using images from a photography book; a searchable database of TV clips; the use of scenes from a film for a biographical film about the lead actor; text and data mining, among others.

The Commission rejects the argument that fair use is too uncertain and therefore should not be adopted:

In the Commission’s view, legal uncertainty is not a compelling reason to eschew a fair use exception in Australia, nor is legal certainty desirable in and of itself.  Courts interpret the application of legislative principles to new cases all the time, updating case law when the circumstances warrant it.  To say otherwise would be to argue that all laws should be prescriptive — a doctrine that is inconsistent with many laws across all social and economic arenas, and completely inimical to the common law.  In addition, even under a fair use regime it is possible to specify a non-exhaustive list of illustrative purposes which provides strong guidance to parties.

Additionally, the Commission points out that there are similarities between the US’ fair use factors and the factors within Australia’s current fair dealing exception for research or study and that fair use may not be as uncertain as suggested.  The report points out that, while not binding, Australia could also look to US court opinions for guidance on fair use.

In 2014, the Australia Law Reform Commission recommended inclusion of a fair use provision with illustrative examples including those found in the US fair use statutes as well as parody or satire; professional advice; quotation; non-commercial private use; incidental or technical use; library or archive use; and access for people with disabilities.  The Productivity Commission states that “the ALRC’s recommendation on fair use represents the minimum level of change the Australian Government should pursue” and recommends expansion of a fair use provision to apply to orphan works and out-of-commerce works (meaning that these would be included in the non-exhaustive illustrative list of purposes).

Explaining the problem of orphan works, the Commission states that it “is not aware of any country that has fully resolved the issue of orphan and unavailable works” then examines the three approaches others are considering including: requiring a statutory license, creating an exception for the use of orphan works (such as the EU directive) and limitations on damages and remedies (proposed by the US Copyright Office).  The draft report concludes:

in the case of orphan and out-of-commerce works, creators are not actively exploiting their creation in order to generate an economic return.  Proposals to create licensing schemes, whereby consumers can pay to access such works, is one approach to unlocking their value, but likely represents a windfall gain to producers.  The Commission considers it unlikely that a creator, prior to investing the time and effort in a new work, does so on the basis that their work will have an initial commercial life, a period ‘out of the market’, and a subsequent revival perhaps decades down the track.  While this does occur for many works, it is largely by happenstance rather than design.

The Commission recommends that, “At its heart, Australia’s exception for fair use should allow all uses of copyright material that do not materially reduce a rights holder’s commercial exploitation of their work at the time of use.”

Copyright Term

The Commission’s report points out that a copyright term of life of the author plus 70 years is excessive.  While it acknowledges that Australia is bound to its long copyright terms as a result of trade agreements, it recommends international negotiations to lower the term.  The Commission notes:

An effective and efficient copyright system sets term at a level that encourages creation without unduly constraining access to creative works.  Since it is not possible to define terms specific to each given work, an “optimal” term is a period that, on average, creates reasonable incentives for creation while avoiding the consumer losses associated with exclusivity.  The situation is conceptually similar to that apply to patents.  Australia’s copyright term provides protection for the author’s life plus 70 years . . . Providing financial incentives so far into the future has little influence on today’s decision to produce.  For example, the addition of twenty years of protection many years in the future, such as occurred when Australia increased term from life plus 50 years to life plus 70 years . . . only increases revenue by 0.33per cent.  Such a small increase in revenue “offers at most a very small additional incentive for an economically minded author of a new work.” (citations omitted)

The Commission also reports that “evidence suggests the vast majority of works do not make commercial returns beyond their first couple of years on the market” and that the average commercial life of music is 2-5 years, for literary works 1.4-5 years, for visual artistic works 2 years, and for film 3.3-6 years.

In addition to the financial costs of copyright term extension in which consumers pay higher prices for a longer period of time, the report also acknowledges other costs such as orphan works.

Ultimately, the Commission finds that “While hard to pinpoint an optimal copyright term, a more reasonable estimate would be closer to 15 to 25 years after creation; considerably less than 70 years after death.”  The Commission acknowledges, however, that “Australia has no unilateral capacity to alter copyright terms, but can negotiate internationally to lower the copyright term” and “the Commission considers that there are strong grounds ofr Australia to work with other countries to attempt, over the long term, to achieve a system that gives greater recognition to consumer interests.”

Relationship Between Contracts and Limitations and Exceptions

The Commission examines the Australian Law Reform Commission’s 2014 recommendation that would prevent copyright licenses from relying on limitations and exceptions and concludes:

exceptions play an important role in balancing the interests of copyright producers and users.  Given the evidence presented by the Australian Libraries Copyright Committee, the Council of Australian University Libraries and National and State Libraries Australasia, the problems appear to mainly relate to libraries and archives, rather than other users.  Given this, the Commission considers that copyright license in the digital world should maintain the copyright exceptions for libraries and archives.

Because “It is less clear license conditions for digital content are undermining consumers’ ability to use Australia’s current copyright exceptions,” the Commission requests more information on this issue beyond the impact on libraries and archives.

Parallel Importation

The Commission also recommends repeal of Australia’s parallel importation restrictions on books and that the reform take effect no later than the end of 2017.

Trade Agreements

The draft report points out some of the harms of increasing intellectual property rights in trade agreements.  For example, with respect to copyright term extension implemented as a result of the Australia-US Free Trade Agreement, the estimated cost to Australia was $88 million per year.  The report points out that “A similar obligation to New Zealand as a result of the Trans-Pacific Partnership was estimated to cost $55 million per year.”

Another key point from the report was that “Multilateral and bilateral trade agreements are the primary determinant of Australia’s IP arrangements.  These agreements substantially constrain domestic IP policy flexibility.”

Meaningful Transparency is Needed in Trade Negotiations

We’re taking part in Copyright Week, a series of actions and discussions supporting key principles that should guide copyright policy. Every day this week, various groups are taking on different elements of the law, and addressing what’s at stake, and what we need to do to make sure that copyright promotes creativity and innovation. Today’s topic is “Transparency: Copyright policy must be set through a participatory, democratic and transparent process. It should not be decided through back room deals or secret international agreements.

Transparency in government is fundamental to a democratic society and meaningful participation.  Without access to information about the laws and policies being considered, the public is unable to substantively comment and address potential areas of concern or challenge and influence public policy.

The negotiations of the Trans-Pacific Partnership Agreement (TPP) which took place over the course of more than five years before a final agreement was reached in October 2015, highlight a poor exercise in transparency.  Over the course of the lengthy negotiations, the official text was never released nor was it released when the trade ministers of the twelve negotiating parties announced conclusion of the agreement.  It was not until December 2015 that any of the parties released the text for the public to view.  While there were several leaks of various portions of the agreement, including quite a few leaks of the intellectual property chapter, relying on leaks is a poor substitute for official releases of text.  By the time a trade agreement reaches its conclusion, it is very difficult, if not impossible to change the text (particularly given the number of negotiating parties in the case of the TPP) and it is therefore important that the public is engaged at an earlier date.

Throughout these negotiations, USTR and other negotiating governments often made claims that the process was a transparent one.  They touted the fact that they provided information about the locations of negotiating rounds and invited stakeholders to give presentations on a “stakeholder engagement” session and attend briefings by the chief negotiators.  However, this form of engagement is not a substitute for seeing the actual text.  Furthermore, the last time stakeholders were provided an official opportunity to present to the negotiators was in August 2013, despite the fact that negotiations continued for more than two years after.

On October 27, 2015, the White House its Third Open Government National Action Plan which sets forth a number of initiatives designed to create a more open government.  One plan initiative regarding access to information reads:

Increase Transparency of Trade Policy and Negotiations. In September 2015, the Administration appointed a Chief Transparency Officer in the Office of the United States Trade Representative who will take concrete steps to increase transparency in trade negotiations, engage with the public, and consult with Congress on transparency policy. This work builds on previous steps to increase stakeholder engagement with trade negotiators, expand participation in trade advisory committees, and publish more trade information online. To further increase public access to U.S. trade policy and negotiations, the Office of the United States Trade Representative will also continue to promote transparency and public access to international trade disputes in the World Trade Organization and under regional trade agreements, and encourage other countries to similarly increase transparency in this regard. The Office of the United States Trade Representative will also continue to encourage posting video of trade dispute hearings to give the public insight into these processes.

While increased transparency is always welcome, in the case of the TPP, this goal comes too late.  Furthermore, the initiative may also be too little as the specifics of the plan reveal that the government is not committing to the transparency necessary for the public to engage in informed debate.  While increased stakeholder engagement with negotiators would certainly be welcomed, there is no commitment to releasing the actual negotiating texts.  Furthermore, the “expand[ed] participation in trade advisory committees” may not be that useful given that under the current rules of the trade advisory committees, individuals are required to sign non-disclosure agreements.

The text of the copyright provisions of the TPP improved over the course of the negotiations.  Many areas of concerns raised by critics of the agreement once leaked text was available were addressed, possibly because of the outcry over these provisions.  Yet, again, relying on the availability of leaked text is risky and the public should be given an opportunity to comment on issues that will affect them, within a timeframe where such criticisms can be addressed. Backdoor policymaking has no place in a democratic society.

As the TPP negotiations have concluded (though it must still be signed and ratified by each of the negotiating parties), attention will turn to another regional trade agreement: the Trans-Atlantic Trade and Investment Partnership (TTIP) with the European Union.

The EU has made steps toward increased transparency in the negotiations.  In November 2014, the European Commission announced that it would publish the dates, locations, names and organizations it meets with and the topics of its discussions. Specifically, the Commission agreed that with respect to the TTIP it would make public the negotiating texts it shares with Member States and Parliament, provide all Members of the European Parliament the TTIP texts, make less negotiating documents classified, and publish a public list of TTIP documents that have been shared with the European Parliament and Council.

The EU has already started to fulfill its promise to enhance transparency and “negotiat[e] TTIP as openly as possible.” On January 7, 2015, the EU released its negotiating texts that had been shared with US negotiators as well as position papers for areas which it had not yet developed and proposed text. The EU’s position paper on intellectual property revealed the intended architecture of the chapter including 1) a list of international intellectual property agreements signed by the EU and US; 2) shared principles that are based on existing rules and practices; 3) binding commitments (specifically referencing two copyright issues: resale rights for visual artists and public performance and broadcasting rights); and 4) areas where the EU and US can work together on areas of shared interests. The fact sheet specifically states that because the EU and US already have detailed enforcement provisions in their laws, “we wont negotiate rules on things like penal enforcement [and] internet service provider liability.”

The United States should improve its commitments to increased transparency in trade negotiations and make their proposals public.  Descriptions about negotiating texts and engagement with stakeholders are no substitutes for the ability to view and comment on the actual texts.  Often, the language included in these agreements are highly technical and commentary and concerns can change based on the exact text.  The goal of increasing transparency should be applauded, but meaningful transparency must be achieved.

 

Fair Use in 2015 and A Look Ahead at 2016

We’re taking part in Copyright Week, a series of actions and discussions supporting key principles that should guide copyright policy. Every day this week, various groups are taking on different elements of the law, and addressing what’s at stake, and what we need to do to make sure that copyright promotes creativity and innovation. Today’s topic is “Fair Use Rights: For copyright to achieve its purpose of encouraging creativity and innovation, it must preserve and promote ample breathing space for unexpected and innovative uses.”

Fair use is a critical right and the most important limitation on the rights of the copyright holder. It permits the use of copyrighted material without permission from the rightholder under certain circumstances and has been called the “safety valve” of U.S. copyright law. Fair use is a broad and flexible doctrine that is responsive to change and can accommodate new technologies and developments.  Notably, fair use is relied upon by everyone, including both users of copyrighted content as well as rights holders. This critical doctrine provides essential balance

Below are five news highlights on fair use from 2015 as well as my five favorite fair use resources created in 2015 (created for Fair Use/Fair Dealing Week 2015).

Five Fair Use Highlights from 2015:

  1. Second Circuit Affirms Fair Use in Google Books Case.  In October 2015, the Second Circuit released its unanimous opinion, authored by Judge Leval, affirming the lower court’s fair use decision in Authors Guild v. Google, also known as the “Google Books” case.  The Second Circuit held that Google’s copying of books and display of snippets in a search index is transformative and a fair use.  This search and snippet function of Google Books allows for important research, including through text-and-data mining to allow researchers to conduct research that would not be possible without the large searchable database created by Google. Additionally, the Second Circuit found that Google’s provision of digital copies to its partner libraries that submitted the particular work is not an infringement.  This digitization of certain works from library collections demonstrates an important partnership, which has allowed libraries to make fair uses of these copies, including to provide access for those who are visually impaired.
  2. Ninth Circuit Rules Fair Use Must Be Considered Before DMCA Takedown Notices Sent.  In September 2015, the Ninth Circuit ruled in Lenz v. Universal Music, also known as the “Dancing Baby” case that “copyright holders must consider fair use before sending a takedown notification, and that failure to do so raises triable issues as to whether the copyright holder formed a subjective good faith belief that the use was not authorized by law.”  In its reasoning, the Ninth Circuit confirmed that fair use is a right: “Fair use is not just excused by the law, it is wholly authorized by the law . . . The statute explains that the fair use of a copyrighted work is permissible because it is a non-infringing use.”
  3. YouTube Announces It Will Defend Some Creators’ Fair Use Claims.  In November 2015, YouTube announced that it will protect “some of the best examples of fair use on YouTube” by defending some creators in copyright litigation.  YouTube pledged to indemnify some of its creators whose fair use videos are subject to takedown notices for up to $1 million in legal costs if the takedown results in a copyright infringement lawsuit. This announcement is significant given that fair use provides essential balance to the copyright system, allowing for transformative uses including parody, commentary, criticism and innovation and videos posted to YouTube often rely on this important doctrine.
  4. Final Text of the Trans-Pacific Partnership (TPP) Agreement Includes Language on Limitations and Exceptions.  In October 2015, the twelve negotiating parties (Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam) announced agreement on the TPP, concluding five years of negotiations.  Although the final copyright provisions of the TPP had mixed results and ARL was disappointed by a number of the provisions and the lack of transparency during the negotiations, one of the positive aspects of the agreement was the inclusion and improvements in the final text on limitations and exceptions. The final text included language based off part of the United States’ fair use provision, with an addition for those with print disabilities, requiring “due consideration to legitimate purposes such as, but not limited to: criticism; comment; news reporting; teaching, scholarship, research, and other similar purposes; and facilitating access to published works for persons who are blind, visually impaired or otherwise print disabled.”  The text confirms that the exceptions can apply “in the digital environment” as well as to uses with “commercial aspects.”  Inclusion of this language is significant.  While the final language could have been strengthened further, the final text still provides an obligation for parties to seek a balance and can be used as a basis for stronger language in future agreements.  As noted by Jonathan Band in a paper exploring the evolution of the limitations and exceptions over the course of the TPP negotiations, “The incorporation of the non-exclusive list of legitimate purposes from 17 U.S.C. § 107 provides TPP countries a powerful basis for concluding that this balance is best achieved through the adoption of an open-ended flexible exception like fair use.”
  5. Authors Guild and HathiTrust settle last remaining issue (preservation); Second Circuit decision strongly affirming fair use stands.  While the Second Circuit’s decision in the HathiTrust case was released in June 2014, the court did not resolve the issue of preservation, sending that issue back to the district court.  In January 2015, the parties entered a settlement on the sole issue remaining issue, ending the litigation in a victory for HathiTrust and fair use.  The Second Circuit’s decision found that creation of a full-text search database and providing access to the print disabled constituted fair use.  In January 2015, however, the defendant libraries stipulated that they complied with Section 108(c) of the Copyright Act and agreed that for a period of five years, if they do not comply with the stipulation, it will notify the Authors Guild, “which, although not a Remaining Plaintiff in this Action, will accept notice.”  Authors Guild released a statement after the settlement, noting that it would not seek an appeal to the Supreme Court.

Five Great Fair Use Resources from 2015:

  1. Fair Use Fundamentals Infographic.  In celebration of Fair Use Week 2015, ARL created this infographic explaining that fair use is a right, is vitally important, is for everybody and is everywhere.
  2. A Day in the Life of a Legislative Assistant.  Jonathan Band authored this document, giving a sample day in the life of a legislative assistant.  This sample day shows just how often fair use is relied upon on a daily basis.
  3. Video: Fair Use and Technology.  Fred von Lohmann explains how fair use is essential to every day technology and how we encounter it on a daily basis.
  4. Podcast: Fair Use Protects Culture From Copyright, Not the Other Way Around.  TechDirt created a great podcast devoted to the important doctrine of fair use and how it provides an essential balance to the copyright system.
  5. 12 Fair Use Myths and Facts.  For Fair Use Week 2015, ARL also produced a “Myths and Facts” document on fair use, covering twelve myths about what fair use is and how it can be used.

So what’s next for fair use in 2016?

First, a reminder that Fair Use/Fair Dealing Week 2016 is quickly approaching and will take place from February 22-26, 2016.  A number of organizations and institutions are already planning to participate and have great events planned.  ARL will be creating a new infographic, hosting blog posts, and posting new videos on fair use.  For more information on how to participate or to see the great resources from last year’s celebration, visit the Fair Use Week website.

Additionally, the Authors Guild’s Google Books case may not be over as the Authors Guild filed a petition for writ of certiorari to the Supreme Court on December 31, 2015.  However, the Authors Guild’s petition does not appear to be a particular strong one.  Despite the Authors Guild’s claims that there is a circuit split on the meaning of transformativeness, it is not clear that the six circuits cited have actually split on the issue as the facts of the cases differ significantly.  Furthermore, the argument that the Second Circuit has shifted to a one-factor test is clearly unsupported by the court’s October decision; the Second Circuit carefully analyzes all four factors.

In fact, Professor Jane Ginsburg noted in her article, Google Books and Fair Use: From Implausible to Inevitable? that the Google Books decision is probably not worthy of Supreme Court review.  She stated that the decision “probably surprised no one” and that “courts came to interpret Campbell’s reference to ‘something new, with a further purpose’ to encompass copying that does not add ‘new expression,’ so long as the copying gives the prior work ‘new meaning.’  Fair use cases began to drift from ‘transformative work’ to ‘transformative purpose,’ in the latter instance, copying of an entire work, without creating a new work, could be excused, particularly if the court perceived a sufficient public benefit in the appropriation.” Ginsburg acknowledges that courts have interpreted transformativeness to include a transformative purpose and does not cite any circuit split on this issue.  She also pointed out that the Second Circuit’s opinion was restrained and did not expand the fair use doctrine.  If the Supreme Court declines to hear the Google Books case, the Second Circuit’s decision will stand.

Additionally, as noted yesterday, the Copyright Office has issued a notice of a study the 1201 rulemaking process which creates exemptions on a three-year cycle to allow for circumvention of technological protection measures.  The exemptions requested during each cycle represent non-infringing uses, such as those that would operate under fair use in the analog world (that is, without the digital locks placed on digital copies).  The notice of inquiry includes a number of questions that are highly relevant to fair use.  For example:

1. Please provide any insights or observations regarding the role and effectiveness of the prohibition on circumvention of technological measures in section 1201(a).

[. . .]

3. Should section 1201 be adjusted to provide for presumptive renewal of previously granted exemptions—for example, when there is no meaningful opposition to renewal—or otherwise be modified to streamline the process of continuing an existing exemption? If so, how?

[. . .]

8. Please assess whether the existing categories of permanent exemptions are necessary, relevant, and/or sufficient. How do the permanent exemptions affect the current state of reverse engineering, encryption research, and security testing? How do the permanent exemptions affect the activities of libraries, archives, and educational institutions? How might the existing permanent exemptions be amended to better facilitate such activities?

9. Please assess whether there are other permanent exemption categories that Congress should consider establishing—for example, to facilitate access to literary works by print-disabled persons?

 

While these are important questions and it is good to see that the Copyright Office is at least considering the idea of permanent exemptions and a streamlined process, these questions highlight the fundamental flaw of the 1201 rulemaking process.  As noted by the Library Copyright Alliance’s statement for the Judiciary Subcommittee hearing on 1201 in September 2014:

The fact that every three years the blind need to expend scarce resources to petition the Librarian of Congress to renew their exemption—or that libraries and educators have to seek renewal of the film clip exemption every three years—demonstrates the fundamental flaw in section 1201. That flaw is that section 1201 could be interpreted to prohibit the circumvention of a technological protection measure even for the purpose of engaging in a lawful use of a work. Congress should adopt the approach proposed by the Unlocking Technology Act of 2013 and its predecessors, attaching liability to circumvention only if it enables infringement.

Fair use should apply equally in the digital world and technological protection measures should not be used to limit the fair use right.  The fact that every three years, proponents of exemptions must use a great deal of time and resources to seek renewal of or a grant of exemptions to anti-circumvention rules to exercise the fair use rights is problematic and inefficient.

 

New Advocacy and Policy Update

The latest ARL Advocacy and Public Policy Update (covering the period from October 1 to December 22) is now available.  Previous Advocacy and Policy Updates can be found here.

From the current update’s summary:

Copyright continues to be an active area with a number of developments since October. The House Judiciary Committee continues to move forward with its copyright review and is close to completing its schedule of meetings between House Judiciary majority and minority staffers and witnesses who testified at hearings during the course of the review. In early 2016, members of the House Judiciary Committee will determine what issues they may want to work on with respect to possible reform. Additionally, Representatives Marino, Chu and Comstock introduced their bill on Copyright Office modernization, which would move the Copyright Office out of the Library of Congress and establish it as an independent agency within the legislative branch. On October 16, 2015, the Court of Appeals for the Second Circuit released its long awaited opinion in Authors Guild v. Google, strongly affirming fair use. Also in October, the Library of Congress released its final rules for the current cycle of the Digital Millennium Copyright Act’s (DMCA) Section 1201 rulemaking. Finally, the Library Copyright Alliance (LCA) filed comments responding to the Copyright Office’s Notice of Inquiry regarding a proposed pilot program for mass digitization and extended collective licensing. These comments questioned the wisdom of such a pilot program.

The US Congress passed the omnibus appropriations bill for FY 2016 and avoided a government shutdown. The omnibus exceeded mandatory caps on discretionary funding, resulting in positive results for higher education and libraries.

The Department of Education issued a proposal to amend regulations and require that all Department grantees awarded direct competitive grant funds openly license all copyrightable intellectual property created with these funds. ARL submitted comments supporting the benefits of open licensing and encouraging continued dialog.

ARL joined in comments on the proposed revision to OMB Circular A-130, the Circular that provides the rules of the road for federal information management and information technology.

The DC Circuit heard oral arguments on net neutrality in December. Although threats regarding a rider to undermine the FCC’s ability enforce its net neutrality rules emerged during the omnibus appropriations process, this rider was ultimately not included.

Congress continues to consider reform of the Electronic Communications Privacy Act (ECPA), and there is widespread support in the House for such reform. The Cybersecurity Information Sharing Act of 2015 was altered in ways that raise greater privacy concerns than its original version and was passed in the omnibus appropriations bill.

The US Supreme Court heard oral arguments in Fisher v. University of Texas at Austin (Fisher II), a case involving the University of Texas (UT) admissions process, which seeks to improve student body diversity.

Finally on the international front, more countries have ratified the Marrakesh Treaty to Facilitate Access to Published Works for Persons Who are Blind, Visually Impaired or Otherwise Print Disabled, moving the Treaty closer to entry into force. The negotiations of the TransPacific Partnership Agreement (TPP) have now been finalized and the texts are now public, but the agreement must still be signed and passed by each of the negotiating parties.

Analysis of the Final TPP (Leaked) Text on Intellectual Property: Mixed Results

*This post is also available as an issue brief here*

On October 5, 2015, the twelve trade ministers of the TPP negotiating parties (Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam and the United States) announced that they had come to an agreement on the large regional trade agreement that had been under negotiations for the past five years.

While the agreement has been criticized for a number of reasons, it is important to recognize the areas where the agreement has improved from the initial proposals made by the United States in February 2011. Civil society, technology companies and academics have participated throughout the negotiating process to improve the language of the final text and many of these efforts are reflected in the agreement.

Of course, one of the main points of criticism regarding the TPP was the lack of transparency; without the various leaks of the intellectual property chapter throughout the course of the negotiations, substantive debate, criticism and proposed alternatives may not have been possible. It is worth noting that the agreement was signed by the trade ministers of the twelve negotiating parties in Atlanta, GA without a single official release of any chapter of the TPP. Notably, when international agreements are negotiated in multilateral fora such as at the World Intellectual Property Organization (WIPO), the negotiations are much more transparent and stakeholders have the opportunity to view and substantively comment on the proposals.  Even today, the final text has not been officially released, though Wikileaks has released a leaked copy of the final agreement’s intellectual property chapter.

Improvements in the Text

The final text of the TPP saw improvement in several areas, including the removal of certain provisions.

Removal of the Ban on Parallel Importation

The United States’ initial proposal included a ban on parallel importation, granting authors “the right to authorize or prohibit the importation into that Party’s territory of copies of the work, performance or phonogram made without authorization, or made outside the Party’s territory with the authorization of the author, performer, or producer of the phonogram.” This proposal would have prohibited parallel importation, limiting the application of the first sale doctrine to authorized copies made within the Party’s territory. Thus, a legitimate copy made in another country could not be sold in the United States without the author’s consent.

This proposal was controversial at the time it was introduced as other negotiating parties strongly rely on parallel importation of works. Additionally, during this time a high-profile court case, Kirtsaeng v. John Wiley & Sons, involving this very issue was making its way through the court system ultimately ending up before the Supreme Court of the United States. In that case, an individual purchased lawfully made textbooks in Thailand, where they were less expensive, and resold them in the United States.

In March 2013, the Supreme Court ruled that the first sale doctrine applies to lawful copies regardless of their place of manufacture. This ruling clarified that United States law does indeed allow for parallel importation, thus conflicting with the United States’ proposal. Despite this ruling, it took many months and several negotiating rounds for the United States to remove its language banning parallel importation. Ultimately, though, this prohibition was removed and is not in the final text of the agreement.

Removal of Language on Temporary Reproductions

Another area of controversy surrounding the United States’ proposal centered around language granting authors the right to authorize or prohibit reproductions “in any manner or form, permanent or temporary (including temporary storage in electronic form).” Many criticized the inclusion of temporary reproductions, particularly the clarification that it applied to “temporary storage in electronic form” as potentially prohibiting the temporary copies that are constantly made by a computer to read e-mails, store documents, access content, etc. Reference to “temporary reproductions” and “temporary storage in electronic form” is not in the final text, another helpful improvement in the text.

Removal of the Ban on Formalities

The October 2014 leak of the IP chapter, which reflected the state of negotiations as of May 2014, revealed that parties had agreed to new language banning formalities that did not appear in prior leaks. ARL criticized this development noting

This language could be problematic if the United States, or other TPP parties, wanted to re-introduce formalities for copyright protections granted that go beyond minimum international standards. Register of Copyrights Maria Pallante, for example, proposed the re-introduction of formalities for the last twenty years of copyright protection in the United States. If adopted, such a proposal would violate the TPP and subject the United States to investor-state dispute settlement, under which a corporation could sue the Unites States government for failure to comply with the TPP.

However, the August 2015 leak, reflecting the state of negotiations as of May 2015, as well as the final leaked text show that the text was ultimately removed. The removal of this language was a welcome improvement, preserving the ability to re-introduce formalities for protections granted under the TPP that go beyond minimum international standards set by the Berne Convention or TRIPS.

Improvements on Technological Protection Measures

The United States’ initial proposal on technological protection measures (TPMs) included detailed language, including a closed-list set of limitations and exceptions to the anti-circumvention rules. In addition to the very limited set of exceptions, the proposal would have allowed countries to use a three-year rulemaking process, modeled after the Digital Millennium Copyright Act (DMCA) 1201 rulemaking process, to create additional limitations and exceptions subject to a “substantial evidence” burden. This proposal would not have permitted new permanent limitations and exceptions to the anti-circumvention rules and was heavily criticized, particularly as certain events, such as the Register’s refusal to renew an exemption in 2012 to allow for the unlocking of cell phones, highlighted the absurdity of the process.

The 2014 leak and the final text of the agreement reveal that parties have removed the closed list of limitations and exceptions as well as the rulemaking process. Instead, the text allows parties to provide for limitations and exceptions and to use legislative, regulatory or administrative processes to create exceptions. This language would permit the creation of new permanent limitations and exceptions.

Furthermore, while the language still provides that a violation of the anti-circumvention rules “is independent of any infringement that might occur under the Party’s law on copyright and related rights,” this text could be mitigated by a helpful footnote that reads “A Party may provide that the obligations described in paragraph (ii) with respect to manufacturing, importation, and distribution apply only where such activities are undertaken for sale or rental, or where such activities prejudice the interests of the right holder of the copyright or related right.”

The fact that the United States’ initial proposal in 2011 made circumvention a “separate and independent cause of action” was controversial and makes little sense. Establishing that circumvention is independent of any copyright infringement negatively impacts legitimate, non-infringing circumvention. However, the footnote that appeared in the final text could mitigate the harm of this provision because circumvention for legitimate purposes would not prejudice the interests of the right holder.

Inclusion and Improvements on Text on Limitations and Exceptions

The United States’ initial proposal included placeholder text for limitations and exceptions on copyright. The United States tabled a proposal on limitations and exceptions in July 2012. While proposal was a welcome one, including language referencing balance for purposes such as “criticism, comment, news reporting teaching, scholarship and research” which had never been in any prior United States free trade agreement, there were also criticisms of the proposal which noted that this new paragraph was “subject to and consistent with” the three-step test. Critics pointed out that some specific limitations and exceptions, such as the quotation right under the Berne Convention, are not subject to the three-step test (that limitations and exceptions are confined to 1) certain special cases, 2) the at do not conflict with the normal exploitation of the work, and 3) do not unreasonably prejudice the legitimate interests of the right holder).

Ultimately, the language regarding limitations and exceptions was improved and clarification was included that the text on the three-step test did not reduce or extend the scope of limitations and exceptions under international agreements including TRIPS, the Berne Convention, and the WIPO Internet Treaties.

The text of the United States’ proposal also improved with respect to the fact that the list of “legitimate purposes” now specifically references “other similar purposes” as well as “access to published works for persons whoa re blind, visually impaired, or otherwise print disabled.” The text also includes a specific footnote recognizing the Marrakesh Treaty and acknowledges that some Parties facilitate the availability of accessible format works beyond the requirements of the Marrakesh Treaty.

Finally, while the language on limitations and exceptions could have been stronger with language mandating that parties achieve a balance or foster a balance, rather than the agreed to language that “Each Party shall endeavor to achieve an appropriate balance in its copyright and related rights system,” the inclusion of the language in the final text is still a success. The United States has now recognized in a free trade agreement the importance of balance in the copyright system. Furthermore, the United States has stated that this language provides “an obligation for Parties to continuously seek to achieve balance in copyright systems,” because the language requires Party to “endeavor to achieve” balance. The words “shall endeavor” do create a mandatory obligation for parties to seek this balance.

Inclusion of this language signals that the Office of the United States Trade Representative (USTR) has responded to criticisms that the United States proposals only export rights for rightholders and not our balanced system which includes limitations and exceptions. This language should be included in future trade agreements and USTR should seek to improve upon it in the future by strengthening the language requiring parties to achieve a balance or foster a balance. Despite the fact that the language could have been stronger, its inclusion in the final text still reveals a mandatory obligation for parties and represents a positive development.

Remedies Allow for Judicial Discretion

The final language regarding enforcement also shows areas where the text has improved from the United States’ initial proposal.

For example the final text includes language that replicates text from the Anti-Counterfeiting Trade Agreement (ACTA) requiring parties to take proportionality into account. The text reads, “In implementing the provisions of [the enforcement] Section in its intellectual property system, each Party shall take into account the need for proportionality between the seriousness of the intellectual property infringement, and the applicable remedies an penalties, as well as the interests of third parties.” This language on proportionality is a welcome inclusion and would ultimately allow domestic laws to provide judicial authorities discretion in ordering remedies.

Additionally, while the United States’ initial proposal in 2011would have required judges to consider certain measures of damages (“in determining damages for infringement of intellectual property rights, its judicial authorities shall consider, inter alia, the value of the infringed good or service, measured by the suggested retail price or other legitimate measure of value submitted by the right holder”) the final language provides judicial authorities the discretion to consider these measures of damages. The final text provides that “judicial authorities shall have the authority to consider . . .” and this added language “have the authority” changes the text from a mandatory obligation that judges consider these measures of damages to providing them the discretion to do so. This addition is an improvement and consistent with current United States law which permits judicial discretion.

Other provisions on the text on remedies includes similar language, providing that judicial authorities “shall have the authority” to impose certain remedies, but does not actually require that authorities order these remedies. While some have criticized the TPP as prohibiting the Copyright Office’s proposal on orphan works (which is a highly flawed proposal as analyzed here and here), the actual text of the TPP permits considerable discretion and does not actually require authorities to order damages in a particular amount.

General Provisions

As noted in ARL’s analysis of the August 2015 leak, language on general provisions reveal considerable positive developments. The final text includes language provides that the objectives of the agreement are as follows:

The protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations.

The principles specifically reference the public interest and address the need to prevent abuse of intellectual property by right holders: 

1.  Parties may, in formulating or amending their laws and regulations, adopt measures necessary to protect health and nutrition, and to promote the public interest in sectors of vital importance to their socio­economics and technological development, provided that such measures are consistent with the provisions of this Chapter.

2.  Appropriate measures, provided that they are consistent with the provisions of this Chapter, may be needed to prevent the abuse of intellectual property rights by right holders or the resort to practices which unreasonably restrain trade or adversely affect the international transfer of technology.

The final text also includes a section on “Understandings in respect of this Chapter” which reads as follows:

Having regard to the underlying public policy objectives of national systems, the Parties recognize the need to:

  • promote innovation and creativity;
  • facilitate the diffusion of information, knowledge, technology, culture and the arts; and
  • foster competition and open and efficient markets;

through their intellectual property systems, while respecting the principles of transparency and due process, and taking into account the interests of relevant stakeholders, including rights holders, service providers, users and the public.

The August 2015 leaked text, reflecting the negotiating text as of May 2015, also included language proposed by Chile and Canada “acknowledging the importance of preserving the public domain.” This text was, however, opposed by the United States and Japan and ultimately not included in the agreement. It is extremely unfortunate that the United States and Japan would oppose inclusion of such text.

However, in the section on “Cooperation” the text from the August 2015 leak remains in the final text recognizing the importance of the public domain:

The Parties recognize the importance of a rich and accessible public domain. 

The Parties also acknowledge the importance of information materials, such as publicly accessible databases of registered intellectual property rights that assist in the identification of subject matter that has fallen into the public domain.

While it is disappointing that the United States and Japan opposed the inclusion of a reference to the public domain in the general provisions, the fact that the importance of the public domain is recognized on the section regarding cooperation is still welcome language.

Shortcomings/Areas for Improvement in Future Agreements

Flexibility on ISP Liability

The final language of the agreement does provide for some flexibilities with respect to Internet Service Providers (ISP). While the text, contained in Section I, is modeled off the DMCA and provides for safe harbors for ISPs implementing a notice-and-takedown system, an annex specifically preserves Canada’s notice-and-notice system. The annex provides that the notice-and-takedown safe harbors do not apply to a Party that has implemented a notice-and-notice system instead.

Unfortunately, this flexibility will only be permitted for Canada and not for the other negotiating parties. The language under the annex requires the system to be in place “upon date of agreement in principle of this Agreement,” which occurred when the trade ministers announced the agreement on August 5, 2015. Canada was the only country at that time to have a notice-and-notice system in place.

However, another annex to the intellectual property chapter provides that as an alternative to implementing the article on ISP, parties may instead implement Article 17.11.23 of the US-Chile free trade agreement. Chile’s system involves notice-and-takedown, but involves a judicial order before takedowns are required. Countries may therefore choose between implementing the language in the TPP or the language of the US-Chile trade agreement.

Unfortunate Extension of Copyright Term

Copyright Term Extension

One of the biggest areas of criticism that remains in the final agreement is that the parties settled on a copyright term of life plus seventy years, or seventy years for corporate works. The United States’ 2011 proposal would have set copyright term as the life of the author plus seventy years, or ninety-five (or up to one-hundred twenty years if unpublished) years for corporate works. While countries did not accept the United States’ proposals on corporate works, they did agree to the term of life plus seventy years. Some countries with pre-existing free trade agreements with the United States (Australia, Chile, Peru and Singapore) already had obligations to provide for a period of life plus seventy years and Mexico had an even longer term, which it proposed, of life of the author plus one hundred years.

However, it is highly unfortunate that the other countries ultimately agreed to extend copyright term, given the lack of justification for excessively long terms. The Hargreaves report commissioned by the United Kingdom, for example, points out that economic evidence does not support copyright term extensions. Maria Pallante, Register of Copyrights, noted that a Copyright Office study questioned “whether copyright term should be extended to benefit remote heirs or assignees, ‘long after the purpose of the protection has been achieved.’” Despite the lack of policy justification for these terms and the fact that copyright term extension damages the public domain and increases the orphan works problem, the final text of the agreement reveals that countries must provide for copyright terms that go far beyond the minimum international standards.

After the trade ministers announced an agreement had been reached, New Zealand released a fact sheet on the TPP. This fact sheet estimated that the copyright term extension would cause “significant cost” to New Zealand: “This cost – in terms of foregone savings on books, films, music and other works – increases gradually over 20 years and averages around $55 million a year over the very long term.”

Article QQ.A.10bis, however, does provide that countries that are required to implement copyright term extension do not need to restore protection to subject matter that has fallen into the public domain in its territory as of the date of entry into force of the agreement. The extension will therefore apply only to those works that are still under protection as of the date the agreement enters into force for that country (which will depend on each country’s domestic process for approving the final agreement).

While the United States will not require changes to its domestic laws with respect to copyright term, it is unfortunate that this term is being imposed on other countries when it far exceeds international standards. Brunei, Canada, Japan, Malaysia, New Zealand and Vietnam will all be required to increase the copyright terms in their countries. Furthermore, it would be extremely difficult for the United States to revisit this term and reduce copyright term in the United States, even though evidence justifies and supports shorter terms, as the TPP would need to be re-negotiated with all TPP parties.

Conclusion

While there are still areas where the TPP should be criticized and several areas where the language of the TPP could have been better, the final text reveals significant improvements from the United States’ initial proposals. It is possible that some of these proposals resulted from stakeholder engagement, including criticisms of prior texts and proposals which was only made possible through leaks. These improvements and changes in the text over the course of the five years of negotiations reveal the importance of transparency in negotiations.

The TPP will still need to be approved by the domestic procedures set forth in each of the parties. In the United States, Congress will vote under the “fast track” procedures it set when it granted the President trade promotion authority. Congress will be able to approve or reject the agreement in a straight up-down vote, meaning that it cannot amend the agreement. Due to the timing set forth under fast track procedures, a vote in the United States will not occur until 2016. In Canada, a vote will not take place on the TPP until after it concludes its upcoming elections on October 19 and the new Parliament is in place.

Whether or not Congress approves the agreement, the final text of the TPP will likely provide the starting point for future negotiations. USTR has used past agreements, particularly the most recently concluded free trade agreements, as a template for future agreements. The gains made with respect to supporting a balanced copyright system should serve as a basis for additional improvements in the future.

TPP Trade Ministers Announce Agreement

On October 5, 2015, the twelve trade ministers of the Trans-Pacific Partnership Agreement announced that an agreement had been reached after five years of negotiations.  The Trans-Pacific Partnership Agreement is a large, comprehensive regional trade agreement in Asia and the Pacific between Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam and the United States.

The press conference announcing a deal had originally been scheduled for Saturday, October 3, before being delayed several times through Sunday reportedly over obstacles concerning agreements on provisions regarding dairy and protections for “biologic” pharmaceutical products.

The New York Times reported that the text of the final agreement will not be made available for another month.  No official release of any of the text of the TPP has been released to date, though there have been several leaks of various chapters including the Intellectual Property Chapter.  It is disappointing that the lack of transparency continued throughout the negotiations, depriving the public of meaningful opportunity to discuss and debate the TPP on the merits of the texts.

While, based on the various leaks of texts, the copyright provisions and general intellectual property provisions have seen improvements since the United States’ initial proposal was leaked in 2011, there are still several areas of concern including around copyright term (no details regarding the agreed to term have been released as of yet, but the most recent leak revealed discussions over copyright terms of life plus 50, 70 or 100 years) and technological protection measures.  Additionally, while the agreement contains positive language regarding limitations and exceptions, this language appears to be permissive rather than mandatory, in contrast with the provisions granting rights to rightsholders.  (For more, based on the August 2015 leak, see this blog post.)

The final language of the TPP will soon be concluded and each country will then need to go through its own domestic processes to pass the agreement.  In the United States, the TPP will go through the “fast track” authority passed by Congress earlier this year, which includes a 90 day waiting period after the Obama Administration sends the TPP to Congress for approval.  Depending on when the TPP — which has been a controversial issue — is sent to Congress, a vote could come during the height of the United States’ election season.  Canada is currently holding its elections, set for October 19, 2015.  The new Parliament in Canada, once in place, will debate the TPP and vote on the agreement.  Other parties in the agreement will also hold elections over the next year, which could impact both the timing of any final approval as well as substantive debate of the TPP in these countries.

New Advocacy and Policy Update: August 14, 2015

A new ARL Advocacy and Policy Update, covering mid-June to mid-August is now available here.  Prior updates can be accessed here.

The summary and contents from the current Advocacy and Policy Update are reproduced below:

Summary

The US House of Representatives began the summer recess on July 30th, and the US Senate adjourned on August 6th with both reconvening on September 8th. September and October promise to be very busy months as both chambers must act on the FY 2017 appropriations bills, highway trust fund, debt ceiling, and many other issues. It is also hoped that there will be a deal to increase the spending limits under sequestration, which higher education institutions and others have long advocated for.

Much of the activity related to copyright has centered around the Copyright Office. Congressional offices continue to explore and discuss ways to modernize the Copyright Office, including various proposals to move the Copyright Office out of the Library of Congress. Additionally, the Copyright Office has issued notices of inquiries that relate to orphan works, mass digitization, visual works, and extended collective licensing.

There have been positive developments with respect to open access, open educational resources, and open data. The Obama Administration released science and technology priorities for FY 2017, which note that “preserving and improving access to scientific collections, research data, other results of federally funded research, open datasets and open education resources should be a priority for agencies.” The FASTR Bill to enhance public access to research was approved unanimously by the US Senate Committee on Homeland Security and Governmental Affairs.

Privacy and surveillance concerns continue as Congress is considering cybersecurity legislation that raises serious issues for privacy and civil liberties. Litigation around net neutrality is in full swing, with the briefs of telecommunications companies opposing the FCC’s net neutrality rules filed in July.

Finally, ARL continues to promote a simple and quick ratification of the Marrakesh Treaty. Currently, 10 countries have ratified the Treaty, and 10 more are needed for it to enter into force.

Contents

Copyright and Intellectual Property

  • Proposal to “Modernize” the Copyright Office
  • Copyright Office Notice of Inquiry on Visual Works
  • Copyright Office Notice of Inquiry on Mass Digitization and Extended Collective Licensing
  • House Judiciary Committee’s Copyright Review

Open Access, Open Educational Resources, and Open Data

  • Obama Administration Releases Science and Technological Priorities for FY 2017
  • Coalition Calls on White House to Open Up Access to Federally Funded Educational Resources
  • FASTR Bill to Enhance Public Access to Research Approved by US Senate Committee
  • National Technical Information Service (NTIS)

Update Appropriations

Draft Bill Would Eliminate NHPRC

Privacy and Surveillance

  • Cybersecurity Legislation
  • Electronic Communications Privacy Act Reform

Telecommunications

  • Net Neutrality Litigation

International Treaties

  • Trans-Pacific Partnership Agreement
  • Marrakesh Treaty

Analysis of August 2015 Leaked TPP Text on Copyright, ISP and General Provisions

The United States is currently negotiating a large, regional free trade agreement with eleven other countries: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. On August 5, 2015, Knowledge Ecology International published a new leak of the Trans-Pacific Partnership Agreement’s (TPP) negotiating text for the intellectual property chapter. This text, dated May 11, 2015 reflects the state of the negotiations prior to the recent Ministerial meeting in Hawaii (and new agreements may have been made during the recent TPP meeting). This latest leak reveals some substantial changes from last year’s October leak of the text by WikiLeaks (which revealed the state of negotiations as of May 14, 2014).

In general, the more recent text shows some improvement over last year’s text, although serious problems remain.

Copyright

Copyright Term

The copyright term has not yet been agreed to, and it has widely been considered to be a political decision to be determined by the trade ministers. Currently, there is a wide range of proposals available for copyright term, ranging from life plus 50 years, to life plus 70 years, to life plus 100 years when based on the life of an author. For corporate works, there are four proposed terms of 50, 70, 75 or 95 years. These are wide ranging proposals and longer copyright terms exacerbate the orphan works problem and hamper the public domain. The potential for excessively long copyright terms that far exceed international standards is one of the largest remaining flaws in the agreement from the perspective of access to knowledge and information. Countries should resist copyright term extension, particularly given the lack of evidence supporting these extensive copyright terms.

Japan’s proposal, which appeared in the previous leak, similar to the Berne rule of shorter term remains. This rule would essentially allow parties to limit the term of protection provided to authors of another party to the term provided under that party’s legislation. For example, if the final TPP text required a period of copyright protection of life plus fifty years, the United States would not be required to provide its period of life plus seventy years to authors in New Zealand, if New Zealand continued to provide a term of life plus fifty years. The United States does not currently implement the Berne rule of shorter term.

Formalities

In last year’s leaked text, Article QQ.G.X appeared for the first time and was unbracketed, signaling agreement by the TPP negotiating parties. This provision read, “No Party may subject the enjoyment and exercise of the rights of authors, performers and producers of phonograms provided for in this Chapter to any formality.” As noted in last year’s analysis by ARL, the language was potentially problematic for countries wanting to re-introduce formalities for copyright protections granted that go beyond minimum international standards. The Register of Copyrights Maria Pallante, for example, proposed the re-introduction of formalities for the last twenty years of copyright protection in the United States, which would have violated the TPP if a period of life plus seventy years was also agreed to.

Although this provision was unbracketed in the 2014 text, it appears from the current leak that this ban on formalities has been removed. The removal of this language is significant as it would not only permit the reintroduction of formalities for the last twenty years of copyright term in the United States, but also allows for formalities in other areas. For example, formalities can be required in order to be eligible for certain remedies for copyright infringement. It could be used to address the orphan works problem by establishing registries in order to receive damages or an injunction for works that are still protected under copyright in the United States, but go beyond the terms required by international law. Footnote 160 in the current leak appears to allow such arrangements, providing that “For greater certainty, in implementing QQ.G.6, nothing prevents a Party from promoting certainty for the legitimate use and exploitation of works, performances and phonograms during their terms of protection, consistent with QQ.G.16 [limitations and exceptions] and that Party’s international obligations.”

Limitations and Exceptions

The language from the previous leak on limitations and exceptions, including a reference to the Marrakesh Treaty, remains in the text and is particularly welcome, given that it has not been included in previous US free trade agreements. The language provides that

Each Party shall endeavor to achieve an appropriate balance in its copyright and related rights system inter alia by means of limitations or exceptions that are consistent with Article QQ.G.16.1, including those for the digital environment, giving due consideration to legitimate purposes such as, but not limited to: criticism; comment; news reporting; teaching, scholarship, research and other similar purposes; and facilitating access to published works for persons who are blind, visually impaired or otherwise print disabled.[164] [165] 

[164] As recognized by the Marrakesh Treaty to Facilitate Access to Published Works for Persons Who are Blind, Visually Impaired or Otherwise Print Disabled (June 27, 2013). The Parties recognize that some Parties facilitate the availability of works in accessible formats for beneficiaries beyond the requirements of the Marrakesh Treaty.

[165] For purposes of greater clarity, a use that has commercial aspects may in appropriate circumstances be considered to have a legitimate purpose under Article QQ.G.16.3

Footnote 164, which references the Marrakesh Treaty, now includes an additional sentence that recognizes that some parties provide for limitations and exceptions for beneficiaries that go beyond the requirements of the Marrakesh Treaty. Currently, ten parties have ratified the Marrakesh Treaty and an additional ten are required for entry into force. Singapore and Mexico, both negotiating parties to the TPP, have already ratified the Marrakesh Treaty, and Canada has introduced a bill paving the way for implementation of the Treaty. A number of other TPP negotiating parties have signed the treaty, signaling an intention to ratify, including Australia, Chile, Peru, and the United States.

While inclusion of language on limitations and exceptions is a welcome addition to the agreement, this provision should be strengthened by making mandatory the obligation to achieve balance rather than using the term “shall endeavor,” as the Library Copyright Alliance pointed out in an August 2012 letter to the United States Trade Representative.

Technological Protection Measures

Last year’s leak revealed language that permits parties to provide limitations and exceptions to technological protection measures “in order to enable non-infringing uses where there is an actual or likely adverse impact of those measures on non-infringing uses.” The leak also revealed that the three-year rulemaking process to create these limitations and exceptions, as earlier proposed by the United States, was removed. The current leak maintains this language, but drops the reference to the three-step test (though the language on limitations and exceptions remains the same) and also eliminates Chile’s proposal that the process for establishing limitations and exceptions requires consideration of “evidence presented by beneficiaries with respect to the necessity of the creation of such exception and limitation.”

Overall, this language is an improvement over the United States’ initial proposal from 2011 regarding technological protection measures, which only allowed for a closed list of specific limitations and exceptions while others could be added through a three-year rulemaking process, because it would allow for new permanent limitations and exceptions to allow for circumvention of TPMs. Such permanent limitations and exceptions could be granted for cell-phone unlocking. However, the language does assume that parties need to provide for limitations and exceptions, even for non-infringing uses.

Article QQ.G.10(c) maintains the unfortunate language that “a violation of a measure implementing this paragraph is independent of any infringement that might occur under the Party’s law on copyright and related rights.” Establishing that the circumvention of a technological protection measure is independent of any copyright infringement negatively impacts legitimate, non-infringing circumvention. It is unfortunate that this language not only remains in the text, but is unbracketed, meaning that countries have agreed to this flawed provision.

Internet Service Providers

The text on Internet Service Providers appears in an addendum and contains important caveats that the text is “Without Prejudice” and “Parties are still considering this proposal and reserve their position on the entire section.” Thus, even where language is unbracketed, it does not necessarily reflect agreement.

The current leak reveals that the text contains significant flexibilities that did not previously exist. For example, the United States and Canada have proposed language that would continue to allow Canada’s notice-and-notice system, rather than require the United States notice-and-takedown system. It appears to protect Canada’s system as one that “forward[s] notices of alleged infringement” but requires that the system exist in the Party “upon the date of entry into force of this Agreement.” If this language is agreed to, it could therefore be conceivable that other parties to the TPP could implement systems of notice-and-notice, provided that they do so before entry into force of the TPP. Similarly, footnote 299 appears to allow Japan to maintain its safe harbor framework.

In last year’s leak, Peru had proposed a footnote that now appears in the general text of the section on ISPs. This paragraph now reads, “It is understood that the failure of an Internet service provider to qualify for the limitations in paragraph 1 does not itself result in liability. Moreover, this article is without prejudice to the availability of other limitations and exceptions to copyright, or any other defences under a Party’s legal system.” This language provides a helpful clarification and clearly establishes the language as a safe harbor, not as a direct creation of liability where an ISP does not qualify for the limitations set forth under the agreement.

General Provisions

In addition to improvements in the copyright section, there appears to be agreement on positive language regarding general provisions. Many of the positive proposals regarding general provisions in last year’s leak were bracketed and not yet agreed to.

The objectives now read:

The protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations.

Additionally, principles that had previously been agreed to by six parties now appear unbracketed and specifically reference the public interest and address the need to prevent abuse of intellectual property rights by right holders:

1.  Parties may, in formulating or amending their laws and regulations, adopt measures necessary to protect health and nutrition, and to promote the public interest in sectors of vital importance to their socio­economics and technological development, provided that such measures are consistent with the provisions of this Chapter.

2.  Appropriate measures, provided that they are consistent with the provisions of this Chapter, may be needed to prevent the abuse of intellectual property rights by right holders or the resort to practices which unreasonably restrain trade or adversely affect the international transfer of technology.

There is also new language, which appears to be mostly agreed to, that promotes the dissemination of knowledge and information. In addition, Chile and Canada have proposed language, which the United States and Japan oppose, emphasizing the importance of the public domain. This article, “Understandings in respect of this Chapter” reads:

Having regard to the underlying public policy objectives of national systems, the Parties recognise the need to:

  • promote innovation and creativity;
  • facilitate the diffusion of information, knowledge, technology, culture and the arts; and
  • foster competition and open and efficient markets;

through their intellectual property systems, while respecting the principles of transparency and due process, and taking into account the interests of relevant stakeholders, including rights holders, service providers, users and the public [CL/CA propose; US/JP oppose; and acknowledging the importance of preserving the public domain.]

It is disappointing that the United States would oppose language acknowledging the importance of preserving the public domain, which provides a storehouse of raw materials from which individuals can draw from to learn and create new ideas or works. The public domain is essential in fostering new creativity and advancing knowledge.

Proportionality in Enforcement

While this analysis does not cover the section on enforcement in detail, there is one significant positive improvement from previous texts. Under the general enforcement provisions, there is new text that appears to be agreed to language that is replicated from the text of the Anti-Counterfeiting Trade Agreement (ACTA) and would require parties to “take into account the need for proportionality between the seriousness of the intellectual property infringement, and the applicable remedies and penalties, as well as the interests of third parties.” Inclusion of this language is a welcome improvement to the text of the enforcement section.

Conclusion

Overall, the text of the copyright section as well as some other key provisions reflect improvements over the initial intellectual property chapter proposed by the United States in February 2011. The section on technological protection measures no longer limits the limitations and exceptions to a closed list and does not impose a three-year rulemaking process. It would allow for permanent limitations and exceptions to anti-circumvention provisions. Additionally, the text shows greater flexibility with respect to ISPs and appears much less complicated than it initially did. Furthermore, the current text reflects agreement on positive language with respect to limitations and exceptions and a reference to the Marrakesh Treaty has been included. The removal of the formalities language that appeared in last year’s text is also a welcome improvement. General provisions and enforcement language has also seen improvements.

While there have been improvements in the text, there are still concerning elements, the biggest of which is the potential for locking-in current lengthy and excessive copyright terms as well as the possibility of even requiring further extension to life plus 100 years. Additionally, the requirement that circumvention of a technological protection measure be independent from copyright infringement is illogical and prevents circumvention for legitimate, non-infringing purposes.  Finally, the obligation to achieve balance through exceptions and limitations should be made mandatory.