Bridges Weekly Trade News DigestVolume 14Number 4 • 3rd February 2010

Closed-Door Anti-Counterfeiting Talks Continue in Mexico


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Since mid-2008, a handful of mostly industrialised countries have been negotiating a secretive treaty on the enforcement of intellectual property rights, ostensibly aimed at fighting counterfeiting.

Participating governments, including the US, the EU, and Japan,* agreed to shroud the Anti-Counterfeiting Trade Agreement talks in near-total secrecy, more so even than is customary for international trade negotiations. No draft agreement texts have been formally released, as has become common at the WTO. The bulk of what has come to be known about participants’ detailed views and specific negotiating proposals comes from a small number of leaks.

Despite this secrecy - or perhaps because of it - the prospective accord is coming under fire from a wide range of observers, from internet service providers to academics and digital rights activists. They warn that the treaty, which goes well beyond dealing with counterfeit physical goods, risks establishing stringent new standards for copyright and intellectual property enforcement. These could stifle information technology innovation, cause legitimate generic drugs to be seized as counterfeits, raise internet access costs, and potentially cause households to have internet access cut off following three unproven allegations of illegal downloading for non-commercial purposes.

Some developing country governments, meanwhile, are concerned that they might one day face pressure to apply rules that they had no part in negotiating.

During the most recent round of closed-door talks, from 26-29 January in Guadalajara, Mexico, negotiators recognised some of these concerns. “Recalling their shared view of the importance of providing opportunities for meaningful public input, the participants reaffirmed their commitment to intensify their respective efforts to provide such opportunities and collectively enhance transparency,” said the joint statement released at the end of the meeting.

But the statement provided little detail about what was actually said during the meeting, saying merely that discussions “focused on civil enforcement, border enforcement and enforcement of rights in the digital environment” - about as much as could have been gleaned from the sparse agenda released prior to the meeting. Even when contacted directly, the Canadian trade ministry and the US trade representative’s office provided no more specific details about what was said during the talks in Mexico.

More detail emerged in news reports from Sweden and New Zealand, according to Michael Geist, a law professor at the University of Ottawa who is an expert on internet and e-commerce issues. Writing on his blog, he said that the internet chapter of the treaty is far from settled. Multiple proposals remain on the table alongside one that would criminalise some forms of personal, non-commercial copyright infringement (such as illegally downloading a movie to watch at home), with sanctions including fines and the possibility of jail time. There were also signs that the Europeans were pushing for the extension of ACTA beyond copyright and trademarks to also include patents, he said.

The statement from Guadalajara did say that the next negotiating round would be in New Zealand in April, and that participants still aimed to conclude an accord by the end of this year.

Fears for internet freedom

Internet providers and users are concerned about what might arise from ACTA. Last November, EuroISPA, a group representing over 1700 European internet service providers, said that the ACTA talks were considering measures that were “severe and wide-ranging including the possibility of users being disconnected from the Internet.”  Under some of the proposals, it said, service providers would be required to implement ‘graduated response’ - often called ‘three strikes’ - measures against customers suspected of illegal downloading, with monitoring and sanctions culminating in disconnection.

“Such heavy-handed measures would create a serious danger of undermining and restricting the open innovative space that lies at the very heart of the Internet’s success,” said Malcolm Hutty, EuroISPA’s president. “This agreement would have a negative impact on Internet users without having an appreciable impact on fighting illicit use of copyrighted material.”

“ACTA will compel internet service providers to filter and remove content and services, turning them into private police and justice auxiliaries. We cannot tolerate that restrictions to fundamental rights and freedoms be imposed by private actors,” said Jérémie Zimmermann, a spokesperson for La Quadrature du Net, a French internet freedom advocacy group.

The UK government has estimated the cost to internet providers of implementing and maintaining a monitoring and ‘graduated response’ system to be in the hundreds of millions of pounds over ten years, Geist recently wrote in the Toronto Star. These costs would be passed on to consumers, and could put smaller providers out of business. The law professor noted that three-strikes schemes mooted by national governments in New Zealand, the UK, and France have met with public opposition and legal obstacles.

More transparency concerns being voiced

The extent to which these fears are justified simply cannot be determined because of the secrecy of the talks, Geist told Bridges.

“Mounting concern” about ACTA had led to increased calls for transparency, even from participating governments such as New Zealand, Australia, Canada, and some European countries, Geist said. But breaking secrecy would require unanimity, he noted.

Last month, David Lammy, UK junior business minister, said that while he was “sympathetic to the view that ACTA negotiations should be more transparent,” he was not in a position to agree to demands from Members of Parliament that the draft texts be placed in the House of Commons library “without the agreement of all our ACTA negotiating partners.”

Governments participating in the ACTA negotiations have insisted that commitments arising from the treaty will fit within their domestic laws. But it is implausible that meaningful changes in policy would not result for the treaty, Geist noted. “It can’t be the case that nothing would change for anybody - or else what’s the point?”

Even some ACTA supporters, generally from rights-holding sectors such as the music and movie industries, have suggested that they would welcome some more transparency about the process.

“We’d like to learn more, we want to find out what’s in it too,” said Mark Esper, executive vice president of the US Chamber of Commerce’s intellectual property centre and a strong proponent of ACTA. He has called for Congressional committees to be better briefed about the ACTA process.  But he told Bridges that “we don’t want the issue of transparency eclipsing an agreement that could be very useful” in terms of US business and workers.

“We’ve been told by USTR that it [ACTA] raises standards on counterfeiting, which is killing our economy, killing the European economy,” he told Bridges. “Everything we’ve heard and read is favourable,” he said, adding that thanks to a USTR process for sharing information about ACTA under the condition of non-disclosure, several treaty opponents had seen more details than he had.

Esper said that he didn’t think that it was necessary or desirable for the issues being dealt with in the ACTA talks to be addressed at the multilateral World Intellectual Property Organization. “It’s important to start with a smaller group of like minded partners to raise the bar… get movement” on copyright enforcement.

Raised bars negotiated among a small group of countries is precisely what has some other countries concerned. Morocco and Mexico are the only relatively poor nations participating in the ACTA negotiations; the countries traditionally associated with counterfeiting are not.

“Of course we have concerns about ACTA,” said a trade diplomat from a large developing country that is not participating in the negotiations. “It is hard to imagine that this will stop among the countries that are at the table.”

The official, who was speaking under condition of anonymity, said that at some point, non-signatories would likely face pressure to adopt ACTA-type rules. This could be as part of bilateral trade negotiations. Alternatively, ACTA rules could come to be seen as international best practice.

The source noted that the leaks from the ACTA process have sounded “TRIPS-plus-plus-plus” - in other words, that the proposed rules go well beyond what exists in the WTO agreement on trade-related aspects of intellectual property rights. The official argued that it was inappropriate for these issues to be negotiated outside a multilateral forum, given the likely pressure to extend their reach in the future. “We didn’t negotiate these rules, we didn’t accept [them] as general rules.”

*The Guadalajara meeting was attended by representatives from Australia, Canada, the EU (represented by the Commission, member states, and Spain, which currently holds the rotating presidency), Japan, Korea, Mexico, Morocco, New Zealand, Singapore, Switzerland, and the US.

ICTSD reporting.

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