First topic: ACTA: Treaties, Trade and Transparency


Live event coverage, FMC 2010 (DC Policy Day) morning panel.  Live stream transmission.

First topic: ACTA: Treaties, Trade and Transparency

  • Richard Bengloff President, American Association of Independent Music (A2IM)
  • Michael Petricone Senior VP, Government Affairs, Consumer Electronics Association (CEA)
  • Malini Aisola, Senior Research Associate, Knowledge Ecology International (KEI)
  • Eric J. Schwartz Partner, Mitchell Silberberg & Knupp LLP, Washington, DC
  • Steven Tepp Senior Counsel for Policy and International Affairs, US Copyright Office
  • Ann Chaitovitz Owner, Ann Chaitovitz Consulting (moderator)


Primer: The Anti-Counterfeiting Trade Agreement (ACTA) is a proposed multilateral trade agreement for establishing international standards on intellectual property rights enforcement among participating countries. Supporters argue that this treaty is a crucial step in protecting intellectual property from counterfeiting and unauthorized distribution in an increasingly globalized, networked world. Critics contend that ACTA threatens to impose harsh restrictions on consumers, and that it could override sovereign nations’ copyright laws. Until recently, open debate was constricted by the confidential nature of negotiations, thus fomenting many rumors about the proposed terms of the agreement. FMC welcomes expert panelists to discuss the terms under consideration, which parties seek what outcomes, and the status of the multilateral deliberations.


Patricone: ‘We cannot support the act to text as it stands,’ points to rigorous copyright penalties ‘without exporting the exceptions’ for which our industry depends.  We are ‘big free traders,’ but ‘significant issues with AFTA as it stands.’


Eric J. Schwartz: Notes only speaking on his own behalf.  On a historical note on treaties, countries understand that treaties need updating.  Focus is often on law, not necessarily on enforcement.  In the music industry, debate not necessarily on law, but how to enforce the laws.

Then, ‘nobody forces a country to enforce anything,’ and ‘sharing of information is often as important as the agreement itself’ to get good practices in place, ‘that is a lot of what is going on’.

Currently ACTA ‘has a lot of bracketed text‘ so saying what it will do ‘is a bit premature’ and ‘a lot of provisions yet to be’ firmed up.


Richard Bengloff: A2IM is supporting ACTA, and part of a ‘coalition that is supporting ACTA’. And ‘did not see final document until May when it was released.’


Petricone: This has been a ‘secretive process‘ where lots of stakeholders were not shown what was going on.  Making comments on ‘April 20 draft, which was released,’ made a call for the draft to be released publicly, and the ultimate release ‘was good’ so that people could ‘see what the facts are.’

Needs an ‘ongoing mechanism’ so that parties can look at this, contribute, and have public debate. Congress doesn’t have this power, ‘doesn’t look at it,’ as it is structured as an agreement and not a treaty.

But, ‘everybody is going to be impacted on this,’ so why the closed process?


Malini AisolaDiscussions could only happen on leaked documents.  They were ‘completely shut out of the process,’ and ‘information came available through a series of leaks,’ a ‘whole year after public requests (requests made under Freedom of Information Act).  They were making formal requests, including on documents that were already leaked.  Describes an extremely closed process that made it incredibly difficult to get any information on the process.


Eric J. Schwartz:  Text is now released, but not close to being finished.  And, ‘there are 37 countries,’ not clear which countries ‘did or did not’ want transparency.  Some countries may have wanted privacy so that they could be more private, really ‘normal transactional behavior’.  This is sometimes ‘part of the process’.


Ann Chaitovitz:  What do the panelists hope ACTA will or won’t do, and what is most concerning provision?


Richard Bengloff: ‘We represent creators,’ lists various artists.  Favorite phrase ‘for profit crime,’ because that is what we see going on right now.  ‘Will support any type of treaty that stops this type of crime,’ and ‘not kids, it’s companies’ that are encouraging this sort of behavior.  ‘People are making money off of this sort of piracy,’ and ‘we’re losing our place in society’ because greatest levels of privacy are happening right here in the US.  ‘Our hope is that this will slam a lot of doors and not give people exits to go to‘.


Michael Petricone: Group won’t support just any agreement, weighing impact on consumer electronics industry.  Problem with ACTA ‘as currently written’ is that there are ‘corollary impacts’ that will impact consumer electronics.  Notes that bill ‘bootstraps issues’ like illegal downloading.  Again, felt locked out of this process.  Also, ‘we’re upset with what’s in ACTA,’ not US copyright law.

Why?  ACTA – all of these sanctions are being exported, but not the balance of fair use, etc.


Bengloff: Challenges Petricone.  Why is paying for intellectual property damaging, and many times A2IM artists waive rights on property at their discretion, but the choice should be theirs.


Petricone: Red herring question.  Issues include ‘secondary liability provisions,’ and ‘no limiting provisions’ to limit liability.  ‘Worst-case’ scenario is what happened in Italy, where uploading in Italy pushed charges to US execs.  These ‘second liability’ aspects are ‘terribly bad trend’ for companies doing business overseas. And, ‘any treaty that exposes companies’ to huge overseas liabilities – not in the US – is a bad idea.


Steven Tepp: More red herrings are being discussed.  ‘ACTA has never been about changing the balance of the copyright law,’ instead it offers more teeth to existing copyright laws from partnering countries. Also, ACTA ‘doesn’t mandate every jot-and-till of secondary liability,’ rather ‘it sets up the basic approach to it in the US’ as a beginning, and allows countries to go beyond it, ‘but ACTA doesn’t require it’.

But, this will help everyone at the table.  ‘ACTA will either require something or it won’t,’ and it ‘won’t require Google executives to go to jail.’


Bengloff: Seems clear that it won’t decide what defines infringement, rather it is up to the countries to decide.  That is a clear provision based on his reading.


Malini Aisola: WRT to KEI, ‘same concerns as many citizens,’ ‘lack of a transparent process,’privacy issues and threats to innovation.  Also, points to inconsistency with US law.

Petricone:[to Steve] Why the secrecy?  If this is not such a big issue to consumer electronics groups?  ‘Thrilled when the text was finally released,’ but ‘thought we were getting somewhere in a process,’ so ‘why not a process going forward’ in some structured way?

Tepp: Not involved in the disclosure policy, and he is quite happy that text was released to get past this issue.  Knows from first-hand experience, has been an ongoing process of consultation that involved civil society groups, ISPs, trademark holders, other stakeholders.  And, ‘changes were made as a result of the comments’.  Assertions of a closed process ‘are at best misleading,’ urges people to stop ‘carping’ on the disclosure issue.

Petricone: Okay, would be nice to have this open process, wouldn’t it?


Eric J. Schwartz: Wants to ‘get past process and into substance’.  Notes that participating countries and the process is ‘not that different than some of my clients’ in the AFTA agreement.  Offers proper tools for parties to ‘develop tools for proper cooperation on effective enforcement’.

The reality of enforcement, ‘need cooperation of ISPs,’ and ‘clear secondary liability’ as the courts have said.

Also, addresses notions of ‘American cultural imperialism’.  Movements in US are towards ‘France 150 years ago,’ and US is moving towards the rest of the world ‘not the other way around’.  So, ‘what is part of our law is part of the harmonizing of the law’ so copyright laws can more easily be transferred over borders.   ‘Need effective enforcement that crosses national borders’.


Ann Chaitovitz: Questions.  This is about to get even more intense.


Question to Steve Tepp: How does ACTA compare to free trade agreements that the US adopted over the past decade?

Tepp: Based on those agreements.  Go look at the last FTA we negotiated (with South Korea), though the goals are more modest.  Language is now broadened, less dense. In ACTA, more appropriate to approach in a more general way to offer more flexibility to ‘set the gold standard’ of best practices described at the beginning.


Ann Chaitovitz: Have countries consulted with their own creators?  Noted that indigenous creators often unaware of their rights, giving away rights they didn’t know they had, etc.

Tepp: Unaware of what each country is doing.  Also, ‘upside of uproar’ could result in more awareness on rights after hearing about the process.

Eric J. Schwartz: Local artists want rights, and those from smaller countries need protection from developed nations in Europe, US, etc., because local protections are very low or non-existent.  Their level of protection is very low, lots of piracy.

Ann Chaitovitz: Raises issues related to artists getting enforcement.

Eric J. Schwartz: First person in Russia to try to set up a rights collection agency was killed, major issue challenging ‘for-profit crime syndicates.’  ‘Need the next step’ to get countries to be involved in good cooperation.


Question from audience: Given little information on ACTA, what advice for people to get more access, more compliance, etc.?

Ann Chaitovitz: ‘Find the organization that feels the same way you do,’ and can get copies of the agreements.  As American, ACTA will be ‘consistent with American law’.

Petricone: Advises visit to Michael Geist site.  But, ‘this is not a law yet.’ Talk ‘to your elected representative, press them to ensure there is some sort of process and some sort of forum,’ and ‘simply not true’ that this has been an open process.  ‘It should be open,’ and ‘this agreement was rejected by the European Parliament’ overwhelmingly.

Bengloff: Also look at Chris Castle’s website.


Ann Chaitovitz:  KEI raised the greatest issue on process.  What do you want to see going forward?  Anything to change on existing ACTA text?

Malini AisolaWants to see the US share their negotiation position ahead of the Swiss round, and ‘ACTA not acceptable in its current form.’  Wants ‘wide range of stakeholders in this process, and stakeholders’ and wants ‘US to take the lead to expand transparency’.  Wants assurances that consumers rights will not be undermined.

Tepp: Good news.  Press release after last round, ACTA will not interfere with civil liberties.  No aspects for searching bags, no three-strikes, etc.

Malini AisolaWould be happier if it was actually in ACTA, not just a press release.  For example, a consumer bill of rights section, to ensure protections.

Tepp: Agreements usually have to focus on positives, not possible negatives, because ‘some of these are fairly wild’ and questions if there is a real problem with a lot of the issues.

Malini Aisola: Raises issues w/ access to medicines.  ACTA ‘seems to be promoting’ border measures that have led to seizures of legitimate generic drugs.

Ann Chaitovitz: This is a broader IP agreement that covers aspects like medicines.

Petricone: Secret process is creating these types of concerns, and questions why Tepp is coming down on Malini for not reading some press release.

Tepp: European Parliament did not reject this.  ‘They didn’t reject anything,’ it was a ‘referendum expressing concern’.  ‘In favor of more consultations,’ and notes that ‘it’s not true’ that FOIAs were filed to get information.

Petricone: First, asking for specific questions – but, really, they don’t want any input.

Tepp: Disagrees.  ‘Where in the text is there a problem,’ and questions ‘whether ACTA will be so detailed and specific that it is going to tie Congress’ hands,’ is it needed?  Questions whether this level of specificity makes sense esp. if it is not in the text at all.

Eric J. Schwartz: These agreements are obligations of countries, not individuals.  What negotiators are trying to do, is to accommodate civil and common law systems, and variety of reactions and to ‘have flexibility’ to take the actions ‘they choose to do’ – references three-strikes in S. Korea.


Question from audience: Can this be done by the end of the year? Is another text coming ‘when brackets start coming off’?

Tepp: USTR is part of the process, so they’re the ones to ask.  It will be open for public comment before it is set in stone.


Ann Chaitovitz: Question for Rich on access.

Bengloff: Indie issue has traditionally been access.  Wants better access on mobile carrier decks, but access is much better now in many other arenas (iTunes,, etc.)  Stopping piracy is critical for ‘protecting intellectual property or we may not have any business,’ especially in a service-based US economy.

Ann Chaitovitz: Thank you very much, appreciate you being here.