Groups, Including CEA, Urge USTR to Leave ACTA Out of Special 301 Review

The U.S. Trade Representative’s annual review of intellectual property protection around the world turned into a referendum on the Anti-Counterfeiting Trade Agreement (ACTA) under negotiation among several countries, in the eyes of many groups. The office received more than 300 comments on which countries should be added to its “priority” and regular watch lists of countries with worrisome IP practices, which should be left off, and the proper grounds for making determinations.

Foreign governments’ comments are due Tuesday in what’s known as the Special 301 review. USTR said it would reserve up to four days for public hearings in early March to hear testimony. The major copyright industries often set the tone for the review: The International Intellectual Property Alliance (IIPA) suggested Argentina, Canada, Chile, China, Costa Rica, India, Indonesia, Mexico, the Philippines and the Russian Federation be on the priority list.

Judging what’s “adequate and effective protection” for IP, the statutory requirement under the review, must be “holistic,” the Computer and Communications Industry Association said: “'Stronger’ is not necessarily better or more effective.” The U.S. recently pledged its support for “better exceptions” to copyright law as well as better enforcement, and it shouldn’t let the review be taken over by unrelated policy goals for copyright, the group said. Though CCIA didn’t directly mention ACTA, its comments reflected the biggest disputes over the agreement.

Canada in particular shouldn’t be on a watch list simply because it didn’t ratify the 1996 World Intellectual Property Organization’s Internet treaties, CCIA said. The European Union only ratified them last year, and “by such logic was presumably as much a haven for pirates as Canada.” The failure to implement technological protection measures -- the U.S. didn’t enshrine them in law when Special 301 was created -- is irrelevant to adequate protection, because such measures are “a means to an end, and it is the end that matters,” the group said. Regarding IIPA’s demand that Canada replace its notice-and-notice system for infringement with a DMCA-style notice-and-takedown, CCIA said Canada’s approach was a “thoughtful, and in a number of cases, superior way of resolving disputes."

Internet services dependent on exceptions in U.S. copyright law and makers of devices that facilitate fair use “could find themselves unable to operate in foreign countries” if USTR encourages others to adopt more expansive protections, the Electronic Frontier Foundation and Public Knowledge said in joint comments. USTR has mentioned ACTA in two previous Special 301 reports, suggesting that failure to adopt the agreement will penalize countries in future reviews, they said. That’s bad because leaked drafts of ACTA suggest it will for the first time set standards on such issues as secondary liability, Internet cutoff triggers and anticircumvention rules for fair uses, the filing said.

The groups asked USTR to elaborate on what it considers “adequate” to protect IP -- such as whether an infringement exception for “private and personal uses” counts as poor enforcement. They also asked USTR to independently verify loss figures from the copyright industries before using them to make factual determinations: “Even the IIPA concedes” many studies assume a one-to-one loss from illegal copies. Antipiracy monitoring service Attributor has called that assumption “overly optimistic."

CEA skipped past the ostensible purpose of the review and warned USTR not to change U.S. law through ACTA. If the DMCA is incorporated into ACTA, it must “adhere closely” to safe-harbor language in Section 512 and previous free trade agreements. That means language such as “in appropriate circumstances” can’t be left out of repeat-infringer termination clauses, or filtering can’t be made the condition for receiving infringement immunity, CEA said. To protect the burgeoning Internet business in user-generated content, CEA called for USTR to adopt language from the U.S.-Chile trade agreement as a template for future bilateral agreements. That agreement conditions civil liability for infringement on “knowingly” circumventing technological protection measures. Contrary to the entertainment industry, CEA asked the U.S. to be “particularly prudent” with China and move beyond “tit-for-tat disputes” at the WTO.

Nintendo of America said South Korea shouldn’t be on a watch list this year, as the company recommended last year, because of its “consistently positive showings” in judiciary and customs enforcement. But the company said Internet piracy there was growing worse in part because of the legal process: Two criminal cases against “Web-hard” services, or closed file-sharing networks, filed in 2007 have been put on hold and the court stayed guilty verdicts against individual defendants. It asked USTR to keep Brazil and Spain on the watch list and China on the priority list, add Mexico to the priority list, and keep Paraguay under “monitoring.”