TPP to 'reflect' notification regime for copyright infringement

The TPP will seek to protect intellectual property by encouraging member states to enact notification regimes and create legal frameworks for enforcement, along with fair use provisions.
Written by Corinne Reichert, Contributor

The Trans-Pacific Partnership (TPP) will protect and enforce online copyright infringement in a manner reflective of a notification regime, according to the Canadian government's summary of the document.

The TPP, which reached agreement on Monday night after talks had stalled several times over digital rights and other issues, will regulate trade between Australia, the United States, New Zealand, Canada, Singapore, Vietnam, Malaysia, Japan, Mexico, Peru, Brunei, and Chile.

The full text of the agreement has yet to be published, with the 12 member states only releasing summaries.

The Australian government's summary of the TPP's agreement on intellectual property was skint, saying only that the parties are continuing to work toward ensuring "an effective and balanced approach to intellectual property rights" -- but implying that no consensus had been reached.

"Australia is seeking IP provisions that are consistent with our existing international commitments and that retain the flexibilities we currently have," the Australian Department of Foreign Affairs and Trade said in its TPP overview [PDF].

"TPP negotiations on IP have progressed considerably over the last six months, but there are still a number of difficult issues to resolve, including pharmaceutical IP."

The Canadian government's TPP summary was more forthcoming, saying that under the agreement, the intellectual property offices of each member state will cooperate on training and exchange of information; protect and enforce copyright; prevent users from circumventing technological protection measures; outline remedies to deal with trade of counterfeit and pirated goods; incorporate civil procedures and remedies for rights holders; mandate the criminalisation of commercial counterfeit and pirating activities; enable rights holders to rectify their rights across the TPP region; and ensure member states protect patents and have a transparent, efficient administration for technological inventions.

According to Foreign Affairs, Trade, and Development Canada's summary of the TPP's intellectual property chapter, the TPP also "reflects" Canada's current intellectual property regime, including the country's "Notice and Notice Regime", which requires internet service providers (ISPs) to forward notifications from copyright owners to customers whose IP address has allegedly infringed the copyright in question.

"As part of the Harper government's efforts to modernize Canada's copyright laws for the modern digital age, the Copyright Modernization Act formalizes the voluntary Notice and Notice Regime. This regime, already used by some Canadian internet service providers, is designed to notify users of alleged copyright infringement taking place at their internet address," the Canadian government said when announcing the regime in 2014.

"The Notice and Notice Regime is a made-in-Canada solution, and will legally require internet intermediaries, such as ISPs and website hosts, to take certain actions upon receiving a notice of alleged infringement from a copyright owner.

"Specifically, ISPs and hosts are required to forward notices, sent by copyright owners, to users whose internet address has been identified as being the source of possible infringement. The intermediary must also inform the copyright owner once the notice has been sent."

By comparison, Australia's recently instituted notification regime consists of a three-strikes policy for those who are caught downloading copyrighted material. The draft code was released in the form of a draft code [PDF] by ISPs and rights holders, which were asked to collaborate by Attorney-General George Brandis and Communications Minister cum Prime Minister Malcolm Turnbull in late 2014.

Under the regime, rights holders will send reports to ISPs identifying IP addresses that have allegedly infringed on copyright, with the ISPs to then match IP addresses with account holders and send the associated customers infringement notices. Customers can be warned three times over a 12-month period in escalating education notices, warning notices, and final notices, after which the ISP involved must make a user's details obtainable through a Federal Court order.

The regime was originally set to be implemented from September 1, but had to be pushed back due to stalling negotiations over the costs imposed by instituting the scheme, and whether the 70 ISPs involved will receive any compensation for being required to enforce copyright on behalf of rights holders.

This code was ordered by the government despite a leaked TPP draft in November 2013 that revealed a three-strikes piracy policy would not be included in the trade agreement, and a leak in October last year revealing that TPP negotiators had decided ISPs should not have to bear large costs arising out of obligations to prevent the copyright infringement of users.

Assuming the TPP does not expressly forbid the three-strikes policy, simply pushing a loosely defined notification scheme for users who have infringed on copyright, the code will likely stand -- though its final form may be affected by a recent judicial decision.

The Australian Federal Court in April ordered ISPs iiNet, Dodo, Internode, Adam, Amnet, and Wideband to disclose the customer details associated with 4,726 IP addresses that had allegedly breached the copyright of Dallas Buyers Club by downloading infringing copies of the film of the same name.

In August, Justice Perram ruled that Dallas Buyers Club's draft letters to send to alleged infringers had overreached in its claims for damages, and would need to be rewritten.

Canada's TPP summary on Monday did also point out that each country "has the flexibility to determine the best means of implementing these provisions within its own IP regime".

The outline of the TPP from the US, meanwhile, identified that the agreement will also ensure that its member states maintain a framework of safe harbour provisions for copyright infringement.

"As a complement to these commitments, the chapter includes an obligation for parties to continuously seek to achieve balance in copyright systems through, among other things, exceptions and limitations for legitimate purposes, including in the digital environment," the Office of the United States Trade Representative said in its TPP summary.

"The chapter requires parties to establish or maintain a framework of copyright safe harbors for internet service providers. These obligations do not permit parties to make such safe harbors contingent on ISPs monitoring their systems for infringing activity."

The former Labor government in Australia had called for a review of its Copyright Act in 2012 to consider whether the Act had been outdated by changes in digital technology, and whether it should consequently be updated in order to adapt to the digital world.

In response, the Australian Law Reform Commission (ALRC) submitted a report to the government, arguing that similar to the laws in the US, a "fair use" exception when a person is accused of copyright infringement should be outlined within the revamped Australian Copyright Act.

Under this provision, the fair use of a copyright material would not constitute infringement, with an incomplete list of fairness factors -- including the purpose of the use, nature of the material, amount of the material used, and the use's effect on the material's value -- to be included in the clause.

Research for the purposes of study, education, news reporting, review, criticism, satire, parody, quotation, non-commercial private use, professional advice, incidental or technical use, library or archive, and access for people with a disability would be exempted from prosecution for copyright infringement, for instance.

The technology sector would in particular benefit from the addition of the non-commercial private use and technical use exemptions, as they would cover data caches, cloud computing, digital recording, and transferring of content.

After putting the report on the backburner, the Australian Attorney-General's Department finally commissioned a cost-benefit analysis into the ALRC's recommendation to implement a fair use provision.

The economic analysis will examine the cost effects that fair use would impose on copyright holders along with copyright user groups.

Brandis, however, has historically taken the perspective of copyright holders to the detriment of all others.

"Without strong, robust copyright laws, they are at risk of being cheated of the fair compensation for their creativity which is their due, and the Australian government will continue to protect them," Brandis said in December 2013.

"I want to reaffirm the government's commitment to the content industries. It is the government's strong view that the fundamental principles of intellectual property law, which protect the rights of content creators, have not changed merely because of the emergence of new media and new platforms."

Upon the eventual tabling of the report, ALRC Commissioner Jill McKeough warned that the absence of such provisions would hinder the progress of Australia's digital economy.

"Fair use is a flexible exception that can be applied to new technologies and services, which is crucial in the digital economy," she said in a statement in February last year.

"Fair use can facilitate the public interest in accessing material, encourage new productive uses, and stimulate competition and innovation. But fair use also protects the interests of writers, musicians, film-makers, publishers, and other rights holders."

Brandis claimed in February 2014 that the recommendation to implement a fair use exception was "a controversial proposal" and would weaken the rights of copyright owners -- however, he was relieved of his copyright responsibilities by Turnbull last month, with the issue being shifted to the Communications portfolio.

The cost-benefit analysis on the ALRC's recommendations into the Copyright Act is expected to be completed by the end of this year, but should the TPP mandate that member states implement fair use and safe harbour provisions, as described under the US government's summary of the agreement, it will likely impact the government's decision and resulting amendments.

The US also made mention of enforcing and punishing piracy, but contained no specifics on a regime for ensuring penalties or systems of enforcement.

"Finally, TPP parties agree to provide strong enforcement systems, including, for example, civil procedures, provisional measures, border measures, and criminal procedures and penalties for commercial-scale trademark counterfeiting and copyright or related rights piracy," the US government department said.

The Australian government has been fixated on policing piracy, with both houses of parliament passing the piracy site-blocking Bill in mid June. The Copyright Amendment (Online Infringement) Act 2015 will allow rights holders to obtain a court order block foreign websites that are deemed to contain copyright-infringing material or facilitate user access to copyright-infringement material, such as peer-to-peer torrenting websites including The Pirate Bay.

The government did not order a cost-benefit analysis or detail who would bear the costs of implementing the scheme prior to passing this law, but it is projected to cost ISPs more than AU$130,000 per year to implement.

The law was passed despite the government releasing a report in July that revealed users who download copyright-infringing content in addition to consuming paid content actually spend more than those who only consume non-infringing content.

The Australian Productivity Commission in June also expressed reservations about how tighter international intellectual property and trade regulations could restrict bypasses to technological protection measures, having the effect of encouraging anti-competitive behaviour.

The Trade and Assistance Review 2013-14 report [PDF], which examined recent international trade policy developments and their effect on Australian regulations, flagged how the TPP in particular could further increase stringent intellectual property rights protections once it is signed off.

"The history of IP arrangements being addressed in preferential trade deals is not good," the commission said.

"Indeed, to the extent that the return to IP holders awarded by more stringent IP laws outweighed the benefits to the broader economy, the provision would also impose a net cost on both partners, lowering trading and growth potential across the bloc."

New Zealand's IT industry also recently expressed concerns that the NZ government would acquiesce to reintroducing software patent protections under regulations potentially to be imposed by the TPP.

"We're an export-driven sector, so we love free trade," Ian Taylor, president of IITP and CEO of Dunedin tech firm Animation Research, said in a letter to Trade Minister Tim Groser.

"However, this can't come at the cost of the future of the technology industry, and that's what it will be if New Zealand's current law banning software patents is traded away in the TPP."

The TPP has yet to be signed and ratified by the 12 Pacific rim nations that are parties to it.

"TPP negotiating parties are now finalising arrangements for the release of the TPP text, and it will be released well in advance of signature," Australian Minister for Trade Andrew Robb explained. "Each country will then undertake its domestic treaty-making process."

"For Australia, this will involve tabling the treaty text in parliament along with a National Interest Analysis and a review by the Joint Standing Committee on Treaties to which all interested parties can make submissions."

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