USTR Special 301 report: Business as Usual
USTR Special 301 report: Business as Usual
USTR Special 301 report: Business as Usual

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    On April 30, this year the Office of the United States Trade Representative (USTR) came out with this its Special 301 Report. The Report is disappointing in many respects. Despite unprecedented public input into the process and calls by public interest commenters to consider the importance of balance in copyright law, the report continues to promote a view of intellectual property (IP) law that tramples on user rights. By providing vague explanations for countries’ placement on watch lists and seemingly placing reliance on unsubstantiated and questionable rights-holder assertions, it completely ignores our calls for transparency and accountability. It continues to arm-twist countries to accede to or implement various international treaties including the WIPO Copyright Treaty and the WIPO Performances and Phonograms treaty (the WIPO Internet treaties), which were used as a basis for enacting the Digital Millennium Copyright Act (DMCA) in the U.S.

    Failure of Transparency
    Like last year’s report, this Report continues to cite countries based on vague criteria such as “inadequate legal framework”, “failure to provide deterrent penalties for criminal infringements”, and “failure to bring copyright law up to international standards including by implementing the WIPO treaties”. How is one to know what an “inadequate legal framework” is or what the USTR considers “deterrent penalties” or what it means by “implementing the WIPO treaties?” The Report of course does not provide any further explanation. As in years past, reference to rights holder comments, which in the case of copyright law is predominantly comments filed by the International Intellectual Property Association (IIPA), provides some context for these pronouncements.

    For instance, India is one of the countries listed on the priority watch list for some of the reasons I mentioned above. The IIPA claims that exceptions in proposed amendments to Indian copyright law permitting personal use are too broad; exceptions that would permit the making of temporary copies, performance of films in educational contexts, or reproduction of books by libraries are overbroad; that the Indian government should ensure that ISPs and rights holders work out a graduated response scheme; and that India should implement a notice-and takedown regime. Do these factors count in considering India’s legal framework inadequate? Given the cozy relationship between the USTR and rights-holders, it is easy to suspect that they do. But, by avoiding any explanation the USTR can easily deny that it considers beneficial exceptions as reasons for placing countries on watch lists. By avoiding any explanation, the USTR is also subjecting sovereign nations to unfair trade pressures and thereby tarnishing the U.S.’ image abroad, merely to further the narrow interests of a few.

    Report does not consider need for balance in copyright law
    The purpose of copyright law is to promote the progress of knowledge and artistic expression. This purpose is achieved not only by providing exclusive rights but also by limiting these rights. Many rights-holder complaints against foreign laws related to such balancing provisions. The IIPA’s complaints against India’s proposed laws, I talked about in the previous section are one example.

    The Report’s citation of countries for not “fully” implementing the WIPO treaties is another example.  Both India and Canada are cited for this reason. Per the IIPA’s comments, both countries have laws or proposed laws that would prevent breaking of digital locks used to protect copyright works. However, neither have provisions that would prevent vendors from selling devices that may permit circumvention. While the WIPO Internet treaties do not require such a prohibition, the IIPA claims that they do. In addition, Inida’s proposed law would also permit circumvention for lawful purposes, which the IIPA claims “would eviscerate any protection” for copyrighted works. As many public interest advocates have explained, the ability to circumvent digital locks for lawful purposes is essential to maintain the viability of copyright limitations exceptions in the digital environment. By citing India and Canada for failure to implement the WIPO Internet treaties, the USTR seems to be endorsing the IIPA’s position.

    Reliance on Unsubstantiated claims of IP violations
    Rights-holder comments to the USTR tend to make claims without citing to any authoritative source. For instance, IIPA’s assertions that local industry estimates in Brazil point to 2 billion songs being downloaded illegally every year, or Canada being the “world’s epicenter for the distribution and export of several categories of tools aimed at circumventing TPMs,” or “shops creat[ing] unauthorized ‘coursepacks'” in Chile do not cite to any authoritative source. Whether or not these assertions are true, rights-holders who have a self-interest in seeking greater IP protections are unlikely to be completely unbiased in their reporting. The USTR’s seeming reliance on these assertions greatly compromises the credibility of its Special 301 Reports. In fact, as Prof. Michael Geist points out, the Canadian government has refused to acknowledge the validity of the Special 301 Reports because they lack “reliable and objective analysis.”

    Like assertions of infringements in certain markets, the Special 301 Report also seems to place reliance on various studies put forth by right-holders highlighting the extent of piracy and counterfeiting and its effects on their in industries and the economy in general. While copyright and trademark infringement may be widespread, the extent of these infringements is hard to quantify. And their impact on rights-holders and the economy is still unclear. Further, a recent GAO report has questioned the soundness of the methodology used in rights-holder commissioned studies.

    Writing this post reminds me of working on the PK-EFF joint comments in the Special 301 process. Everything I have said about the 2010 Report, we said about the 2009 Report in our comments. Our comments and oral testimony have been completely ignored. By contrast, in keeping with the cozy relationship between the USTR and IP industries, the copyright industry claims, however unsubstantiated or self-serving seem to have carried the day.

    The danger of this process is that it subjects sovereign nations to unfair trade pressures as a means of getting their IP laws to protect the interest of rights-holders at the expense of broader public interest. Further, this process can be used effectively to pressure countries to sign treaties they don’t think are in their interest. The WIPO Internet treaties are the current focus and Canada seems to be falling prey to U.S. pressure to adopt a implementation of the WIPO Internet treaties.   

    If signed, the Anti-Counterfeiting Trade Agreement (ACTA) will no doubt be the next treaty pushed on countries through the Special 301 process. Ultimately, this constant upward ratchet in IP protection will prevent much needed reform in U.S. law.

    We hope to stem this tide. This year marked the first time the public participated in strength in the USTR’s Special 301 process. Just as the access to medicines community has made some inroad, albeit very limited, into the process, we hope that advocates for balanced copyright will also be able to do so.