The US and Japan are leading negotiations behind closed doors with Australia and nine other Pacific Rim countries over the Trans-Pacific Partnership Agreement (TPP), a proposed free trade and investment pact that is likely to require criminal penalties for some forms of copyright infringement. "The strategy of the US is to expand criminal offences for copyright law and trademark law," said intellectual property expert Matthew Rimmer, an associate professor at the Australian National University. "I think the reason why the Dallas Buyers Club dispute has attracted such controversy is that it really taps into these larger rolling policy efforts to have tougher, stronger copyright protection in the online environment." The terms of the TPP will not be made public until a deal has been struck between the 12 countries, which account for 40 per cent of the global economy. But a leaked draft of the intellectual property chapter, published by WikiLeaks in October last year, suggests a potential expansion of the range of conduct that could result in criminal sanctions.

There are already criminal offences in the Australian Copyright Act, in addition to provisions allowing rights holders to sue people who infringe their copyright for damages. The Australia-US Free Trade Agreement, inked in 2004, created some new offences relating to copyright infringement on a "commercial scale" – which is broadly defined and may catch people sharing films online even when it is not a commercial activity. The maximum penalty is five years in jail. "That covered the kind of uploading scenario, so if you're sharing a movie online that's already potentially criminal," said associate professor Kimberlee Weatherall, an intellectual property expert at the University of Sydney Law School. The TPP may go a step further and extend criminal sanctions to private acts carried out for "financial gain", which "arguably covers downloading where you're avoiding paying for something," she said. The nature of file-sharing services such as BitTorrent means that most users are both uploading and downloading content. But there are major hurdles to proving criminal infringement, which means prosecutors are likely to focus their energies on people setting up websites offering pirated films or other copyright works.

"I don't think the federal police are going to be bashing down file sharers' doors any time soon," said associate professor Weatherall, but "it's not OK to hold criminal liability over people's necks like the sword of Damocles." The possibility of people being sued for copyright infringement could not be ruled out, although "the idea is that it's a deterrent, it scares people. It gets a lot of publicity and then hopefully people are put off". As the TPP talks enter their final stretch, the telco industry has lodged a Copyright Code with the Australian Communications and Media Authority which would create a streamlined scheme for ISPs to hand over customers' details to film studios. Sarah Agar, a policy and campaigns adviser at consumer group Choice who works on digital issues, said this would create a "rubber-stamp situation" compared with the Dallas Buyers Club case, where the ISPs fought the application and the court is supervising any legal letters sent to consumers. "I think it's important for consumers that we do see those sort of court processes," she said. "There should be rigorous checks and balances before information is handed out on the basis of unfounded allegations."

Federal Trade Minister Andrew Robb has said the government is only supporting copyright and enforcement provisions "consistent with our existing regime" and will not support TPP provisions that would result in new civil remedies or criminal penalties for copyright infringement. However, legal experts say there is a risk Australia may agree to some new provisions in exchange for greater access to global markets. "We completely believe the Department of Foreign Affairs and Trade and Andrew Robb's office when they say they don't intend to change Australian law," said Trish Hepworth, executive officer of the Australian Digital Alliance. "But our concerns are two-fold: one is that they cannot guarantee that the laws won't be changed, and ... we may agree to things that, while they don't change our law now, restrict our ability to change our law in the future." Mr Robb has said negotiations on the TPP could be concluded within the next two months.