New counterfeit may seriously harm public interest, say CSOs

An Anti-Counterfeiting Treaty currently being created by some Governments could potentially be very harmful to consumers, the public interest and developing countries, say civil society groups.

Riaz K. Tayob and Sangeeta Shashikant

Over a hundred civil society groups have attacked the secrecy surrounding negotiations going on among some Governments to create an Anti-Counterfeiting Treaty (ACTA) that they say could have ‘very harmful consequences’ on consumers, the public interest and developing countries.

In an open letter, the Civil Society Organisations (CSOs) called on the Governments to immediately publish the drafts of the agreement. They criticised the treaty negotiations as lacking in transparency and fundamentally undemocratic.

The recent G8 Summit’s Declaration on the World Economy implored negotiators to conclude ACTA negotiations this year. The CSOs said that given this timeline, “it is imperative that relevant text and documents be made available to the citizens of the world immediately.”

The Governments involved in the ACTA are the United States, the European Union, Switzerland, Japan, South Korea, Canada, Mexico, Australia and New Zealand, according to the CSO letter. However, an EU Parliamentary report also mentions Jordan, Morocco, Singapore and the United Arab Emirates as being involved.

The CSOs expressed serious concerns over the reported scope and provisions of the ACTA. The potential problems include:

- Infringement of Internet users’ privacy as Internet service providers may be required to monitor consumers’ Internet communications and cut their connections for alleged copyright infringement.

- Interference with the fair-use of copyright materials and criminalisation of peer-to-peer file sharing.

- Interference with the legitimate parallel trade in goods, including brand name pharmaceuticals.

- Possible legal hurdles placed against legitimate manufacturers of active pharmaceutical ingredients and adversely affecting the legal generic medicines industry, thereby affecting access to medicines at affordable prices.

- Improper diversion of public resources into the enforcement of private rights.

Since ACTA documents remain secret, the public has no way of assessing whether and to what extent these and other concerns are merited.

The letter states that neither the draft text of the ACTA agreement nor the pre-draft discussion papers have been publicly made available. The CSO letter to the States involved states that “there is no legitimate rationale to keep the treaty text secret, and manifold reasons for immediate publication.”

The letter adds that “the lack of transparency in negotiations of an agreement that will affect the fundamental rights of citizens of the world is fundamentally undemocratic.”

This is exacerbated by the public perception that lobbyists from the music, film, software, video games, luxury goods and pharmaceutical industries have had ready access to the ACTA text and pre-text discussion documents.

The CSOs state that “trade in products intended to deceive consumers as to who made them poses important but complicated public policy issues.” They warn that an over-broad or poorly drafted international instrument on counterfeiting could have very harmful consequences.

The letter elaborates on some of the CSOs’ concerns. One concern is whether ACTA will require Internet Service Providers (ISPs) to monitor consumers’ Internet communications. This may mean ISPs would have to terminate customers’ connections based on rights holders’ repeat allegations of copyright infringement.

There are issues of privacy, due process and ISP liability for alleged end-user infringing activity. ACTA may also interfere with the fair-use (referring to legal exceptions) of copyright materials and criminalise peer-to-peer file sharing.

In addition, there are concerns that the ACTA could interfere with the legitimate parallel trade in goods, including brand name pharmaceuticals. There are concerns whether ACTA will impose liabilities on manufacturers of Active Pharmaceutical Ingredients (APIs) if these are used to make counterfeits.

This is a “liability system that may make API manufacturers reluctant to sell to legal generic drug makers and thereby significantly damage the functioning of the legal generic pharmaceutical industry,” said the CSOs.

They highlighted concerns whether ACTA will “improperly criminalise acts not done for commercial purpose and with no public health consequences.”

Further, said the CSOs, there are concerns that ACTA will “improperly divert public resources into the enforcement of private rights.”

With the ACTA negotiations remaining secret, the source for much of the information on ACTA seems to be documents released through Wikileaks (a website that releases sensitive information that is in the public interest).

Last October, IP-Watch (an Internet-based news service) reported on some of the countries’ intentions to negotiate ACTA. It reported that Switzerland, the European Commission, Canada and Japan had engaged in preliminary talks since mid 2006 on such an agreement.

In August this year, a spokesperson for the EC was quoted by IP-Watch as saying that it was “not likely that negotiating texts themselves will be made public at this early stage” and referred to two rounds of negotiations so far.

An IP-Watch report said that previous discussions focused on civil remedies for infringements of intellectual property rights, including the availability of preliminary measures, preservation of evidence, damages and costs. The negotiations on border measures were not concluded, while cooperation between customs authorities was not yet discussed. A first draft of a text dealing with Internet IP infringements could soon be produced.

The EU Trade Commissioner Peter Mandelson last October claimed that the new treaty will create a ‘new global gold standard on IPR enforcement’. US Trade Representative Susan Schwab said, “Global counterfeiting and piracy steal billions of dollars from workers, artists and entrepreneurs each year and jeopardise the health and safety of citizens across the world.” She indicated her intention that the treaty has a global reach.

However, various CSOs have countered the Governments’ move on the ACTA, raising several public interest concerns and demanding that the draft texts be made public.

In a submission to the US Trade Representative, the US consumer rights group Essential Action contested the view of USTR staff that it is standard for trade talks to be conducted in secrecy.

James Love, Director of Knowledge Ecology International (KEI), based in Washington DC, said, “Counterfeiting, properly defined, is a serious problem. Why the top secret negotiating approach for this treaty?

The USTR won’t even give us the agendas of the meetings or the names of the negotiators, or the proposed texts, stuff that is normally transparent.

“I think the answer is the bogus use of an emotive term, counterfeiting, to push an unbalanced IP enforcement agenda, without any attention to civil or consumer rights. Unfortunately, there is bipartisan support for this assault on openness and transparency.”

Professor Michael Geist, of the University of Ottawa, stated that “The ACTA has raised concerns for millions of citizens around the world. The time has come to lift the veil of secrecy and ensure that the future negotiations occur in an open and transparent environment.”

Gwen Hinze, of the Electronic Frontier Foundation in San Francisco, said: “Despite its potentially harmful impact on consumers’ privacy and free expression, and on Internet innovation, the citizens that stand to be directly affected by ACTA’s provisions have been given almost no information about its contents. Given the expedited timeframe in which it is being negotiated, citizens deserve to see the full text of ACTA now, so that they can evaluate its impact on their lives.”

- Third World

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