[A2k] IUT: Countries Offer ACTA Language To Replace U.S. IPR Proposal

Inside US Trade Monday, May 14, 2012 Daily News Countries Offer ACTA Language To Replace U.S. IPR Proposal Posted: May 14, 2012 DALLAS -- In an apparent effort to break the deadlock in negotiations for an intellectual property rights (IPR) chapter in the Trans-Pacific Partnership (TPP), several countries are proposing that certain provisions in a U.S. proposal be replaced with language from the Anti-Counterfeiting Trade Agreement (ACTA), according to informed sources. Sources said that other ACTA signatories involved in the TPP – New Zealand, Australia and Singapore – want to substitute language from the agreement’s criminal offenses section with the proposed U.S. language on criminal enforcement, according to sources in Dallas. Negotiations on IPR here have largely centered on the enforcement section, where ACTA language would offer more flexible language compared to the U.S. IPR proposal. The ACTA is not in effect among the countries that negotiated it because too few of them, including the United States, have formally ratified it. Although its provisions represent a much higher standard than the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), they contain flexibilities not found in the U.S. proposal for IPR in the TPP, sources said. Specifically, the ACTA and the U.S. proposal both would require countries to provide for criminal procedures and penalties at least in cases of “willful” counterfeiting of trademarks and copyright piracy on a “commercial scale.” However, the U.S. proposal contains a much stricter interpretation of what constitutes commercial scale because it would cover significant infringements for both the purposes of commercial advantage or private financial gain as well as acts that result in no direct or financial gain. One source said this provision could criminally punish an individual who has committed a significant act of infringement but does not intend to gain financially from it. IPR industry sources defend this approach as capturing users of file sharing services who do not stand to gain financially by sharing a large amount of pirated content. ACTA, on the other hand, considers infringement on a commercial scale to be acts carried out as commercial activities for direct or indirect economic or commercial advantage. This represents a lower threshold because it defines commercial scale infringements as requiring the existence of some financial gain, whether direct or indirect, sources said. The U.S. IPR proposal also goes beyond ACTA because it requires criminal procedures and penalties to be applied for cases of trafficking in counterfeit labeling and packaging even if it is not done willfully. ACTA requires willful importation of counterfeit labels or packaging before criminal procedures can apply, which is harder to prove because it requires showing a certain intent by the infringer. The ACTA provisions on criminal offenses also differ from the TPP proposal in the application of criminal measures to illegal camcording of movies. Under ACTA, criminal prosecution is optional, while the U.S. IPR proposal in TPP requires a country to apply criminal procedures to cases of illegally camcording a movie in a movie theater. A U.S. industry source said it would be important to have mandatory language on illegal camcording because many countries involved in TPP negotiations do not have anti-camcording laws in place. Industry sources in Dallas were not supportive of ACTA language being substituted for the U.S. proposal on criminal enforcement because they consider it too weak. One industry source argued that the ACTA was negotiated under much different circumstances than the TPP because it dealt only with IPR and is not part of a larger free trade agreement that contains sections such as market access, which can be used as leverage to secure support for strong IPR protections. This source also argued that the U.S. IPR text largely reflects the U.S.-Korea FTA and it would be unlikely the U.S. would agree to provisions that are less strict in the area of criminal enforcement. Civil society sources also viewed the alternative language proposal with skepticism for the reason that ACTA, although more flexible than the U.S. proposal, is still too far above a TRIPS standard for them. A senior U.S. negotiator acknowledged the controversy surrounding the U.S. IPR demands by saying in a May 13 press briefing here that there are “different views on the part of countries around the table” on various elements of the IPR text. The official said that the Dallas talks have provided more clarification of the specific positions taken by different countries on the U.S. IPR proposal. The negotiator said that based on this clearer picture there is a hope that the different view points can be addressed in coming rounds. When asked if the U.S. would be willing to alter its proposal as a result of the objections from other TPP partners, the official would only say the U.S. will proceed as it would in any other TPP chapter. The U.S. will reflect “on the concerns that were raised and provide counterproposals to what was tabled in previous negotiations,” the negotiator said.