ACTA Text on ISP Liability, Criminalization of Online Copyright Infringement Remains Controversial

ACTA’s section on intellectual property rights enforcement in the digital environment requires signing countries to set criminal and civil sanctions for infringements over digital networks without creating barriers to legitimate e-commerce or violating fundamental rights. Signers must try to “promote cooperative efforts” in business to deal with trademark and copyright infringement, and they may give national authorities the right to order online service providers to provide subscriber information to rights holders in infringement cases. The agreement also requires governments to provide legal protection and remedies against circumvention of technological protection measures (TPMs).

ACTA’s TPM provisions mirror those in U.S. law, which are becoming increasingly controversial as the scope of copyright expands and more works are available in digital formats, the Electronic Frontier Foundation said. Including those provisions in ACTA will hamper Congress’s ability to reform domestic law and create new copyright exceptions and limitations, it said. ACTA requires signers to provide legal anticircumvention protection regardless of whether circumvention is done for copyright infringement or results in it, EFF said. Allowing countries to penalize circumvention when it’s done to make a copy permitted by an exception or limitation could undermine current national copyright frameworks, it said.

ACTA requires enactment of criminal procedures and penalties for copyright infringement in a “substantially broader range of instances” than current international norms call for, EFF said. It would expand the Trade-Related Aspects of Intellectual Enforcement Rights (TRIPS) Agreement by interpreting “acts carried out on a commercial scale” to include those “carried out as commercial activities for direct or indirect economic or commercial advantage,” which sweeps in the daily activities of many Internet users in ACTA countries, the foundation said.

If the real purpose for introducing criminal sanctions is to cut Internet infringement, “this provision is not likely to do so,” but it will cause significant collateral harm to consumers, EFF said. It would be better to promote new business models based on licensing content than to criminalize millions of users who file-share regularly, it said. All indications are that legal penalties only drive file-swappers to use encryption, EFF said.

ACTA “is no ordinary trade agreement,” because it deals with Internet governance matters, said the Internet Society. It bashed ACTA participants for long keeping the accord secret and for excluding interested parties from the talks. Decisions on appropriate enforcement mechanisms for IP rights online are an important issue for many stakeholders, not just governments, the Society said.

Although ACTA apparently doesn’t require parties to impose measures such as Internet access suspension or blocking, it does mandate appropriate IP enforcement procedures, ISOC said. Negotiators missed a chance for countries with strong legal frameworks and leading digital economies to specify what enforcement mechanisms would not be appropriate, it said. The Society also worried that the language encouraging cooperative efforts in business could shift enforcement to private bodies. The Consumer Electronics Association, however, praised negotiators for removing language that would have required a “notice-and-takedown” system for online service providers concerning trademark infringement claims.

The Internet Commerce Coalition, which represents ISPs and e-commerce companies, said ISPs are often unable to prevent infringing goods from entering the market, and efforts to do that could be “expensive, burdensome and likely result in unintended consequences affecting the flow of lawful goods and services over the Internet.” It proposed language clarifying that judges could issue injunctions against online service providers over IP infringement issues only after weighing consideration such as freedom of expression, user privacy and the blame due an intermediary.

ACTA “should be rejected in its entirety,” the Free Software Foundation wrote. The agreement doesn’t “respect sharing and cooperation” and it would hinder the uncompensated and noncommercial creation and use of works that are a “natural consequence of the digital era,” it said. The agreement is “based on one faulty premise: that most everyone in the world will ultimately benefit” from added copyright and trademark enforcement, but the premise remains unproven, the foundation said. The Business Software Alliance, however, applauded ACTA for clarifying that unlicensed software use by businesses is subject to criminal penalties, which the group said will drive down infringement.

The U.S. must ensure that efforts to increase protections for rights owners don’t make it harder for American Internet and technology companies to do business overseas, said the Computer and Communications Industry Association. Much of ACTA is “commendable and non-controversial,” but its enforcement-only approach has the effect of promoting U.S.-style enforcement without U.S.-style exceptions, it said. CCIA urged the U.S. to push other countries to adopt fair use and other exceptions, saying their absence subjects U.S. businesses to liability abroad for activities such as search engine operations.

European academics recently advised the European Parliament to reject ACTA for failure to comply with EU law. Communications and intellectual property law professors said the agreement requires stronger TPM safeguards than the World Intellectual Property Organization Copyright and Performances and Phonograms Treaties and covers TPMs with both legal and illegal functions. A requirement that online service providers disclose subscriber data goes beyond that of TRIPS and imposes the duty on noninfringing as well as infringing intermediaries, the professors said. ACTA mentions that privacy and free speech rights must be preserved but doesn’t explain how, they said.