FYI: >Date: Fri, 12 Nov 1999 20:23:03 -0500 >From: James Love <[EMAIL PROTECTED]> >To: Multiple recipients of list RANDOM-BITS <[EMAIL PROTECTED]> >Subject: EC response to TACD recommendations on e-commerce and intellectual > property > >--- EC response to TACD recommendations on e-commerce > and intellectual property > > The Trans Atlantic Consumer Dialogue (TACD) is a forum of more than >60 US and EU consumer organizations which develops and agrees upon >joint consumer policy recommendations to the US government and European >Union. It was organized in 1998, and has a web page at >http://www.tacd.org. > > The TACD was increased in part in response to the Trans Atlantic >Business Dialogue (TABD), which was organized much earlier. >(http://www.tabd.org). There are also similar dialogues on labor and the >environment. > > The following are the April 1999 TACD recommendations concerning >Intellectual Property and electronic commerce, followed by the European >Commission's responses. > > The EC's responses were disappointing in many areas, and generally a >justification of the status quo. Indeed, often the EC offers a TABD >position (the Business dialogue) as a justification of its policies, >which is hardly comforting to TACD members (consumer groups). > > One interesting EC comment concerned business practices patents. >TACD had asked the EC and the US government to hold hearings to >determine if e-commerce business practices patents were "needed, or if >they are unnecessary, anticompetitive and socially wasteful." The EC >comment was: > > With regard to patents on so-called "business > practice patents" (Recommendation No. 7), currently > Article 52 of the European Patent Convention excludes > from the scope of patentable inventions "schemes, > rules and methods for doing business". Therefore, the > request by the TACD to solicit public comments and > hold public hearings in this respect would not be of any > additional value at the moment. > >Unfortunately, the US government is issuing these patents in >large numbers, and Article 27.1 of the WTO's TRIPS agreement >on intellectual property requires member countries to provide >patents: > > available for any inventions, whether products or > processes, in all fields of technology, provided that > they are new, involve an inventive step and are capable > of industrial application . . . patents shall be > available and patent rights enjoyable without > discrimination as to the place of invention, the field > of technology and whether products are imported or > locally produced. > >Some US government officials, including officials from the USTR, >are arguing that the US government should force the EC and >other WTO members to extend patent to business practices. > > Here are the TACD recommenditons, followed by the EC response. > > Jamie Love <[EMAIL PROTECTED]> > > ><-TACD Recommendations on Intellectual Property and E-Commerce-> > >Intellectual property and electronic commerce > >The Internet and new information technologies present a number of >complex issues regarding intellectual property rights. Authors >and creators have an interest in protecting unauthorised >commercial exploitation of their own works, but also in obtaining >access to the works of others. Firms that sell computing >equipment and software may seek protection for those works, but >also may need the right to reverse engineer or develop products >that are interoperable with works owned by others. Citizens >benefit from the economic incentives of copyright laws, but also >from fair ( innocent") use exemptions in several national >copyright systems. The free flow of information is essential >for a variety of purposes, including the exercise of free speech >and the ability of innovate and create. Education use presents >special issues, including those involved in distance learning. > >For these reasons, governments in the US and the EU should >embrace an intellectual property framework that includes the >following elements: > > 1. Distance Education. Mechanisms to protect > copyrighted works on the Internet should not unduly > restrict the ability of educators to share information > with students in ways that are equivalent to current > practices involving more conventional teaching methods. > > 2. Privacy. There are important conflicts between > privacy and certain technologies that protect copyrighted > materials. Privacy is a social good. Society should > avoid mechanisms to protect copyright that are > unreasonable intrusions on personal privacy, particularly > when less intrusive mechanisms are technologically > feasible. > > 3. Copyright exceptions. Governments should > provide copyright exceptions that address such issues as > fair or innocent use, private copying, library uses, > research and private study, and exceptions that are > essential for reverse engineering and other techniques > needed for the development of interoperable products. > Consumer rights in the digital world should not be less > than traditional rights in older publishing and other > information technologies. Consumer rights for fair uses > of copyrighted materials should not be alienated by > coercive or unfair contracts. Legislation to implement > WIPO treaties should address these concerns. > > 4. TRIPS Article 13. Governments should ask the WTO > to expand Article 13 of the TRIPS regarding exceptions to > copyrights. The language is currently too narrow, and > does not even include the language in Article 30 > concerning patents, that permits governments to consider > the legitimate interests of third parties. > > > 5. Public Domain and non-commercial software. The > public domain and non-commercial software plays an > important role in public and commercial life. The > Internet is built upon public and open protocols and uses > a wide range of free software programs. Free software > operating systems such as Linux and xBSD are important > alternatives to more monopolistic server technologies. > Databases of government information provide an important > new foundation for civic democracy in the information > society. > > 6. Database rights. National legislation to protect > investments in databases should avoid overly broad > protections, creating rights in facts, or rights that lead > to anticompetitive or monopolistic acts. > > 7. Business Practice Patents. The US and EU > governments should ask competition authorities to solicit > public comments and hold public hearings on the policy > issues associated with issuing patents on business > practices, including those associated with electronic > commerce, to determine if these patents are needed, or if > they are unnecessary, anticompetitive and socially > wasteful. > > 8. > Parallel Imports. Electronic commerce raises profound and > fundamental challenges to national policies that seek to > restrict parallel imports of goods. Government should > provide for international exhaustion of rights for > copyrights, patents and trademarks, as is permitted under > Article 6 of the WTO/TRIPS agreement, so that consumers > can benefit from the free flow of goods. Governments can > require that goods be labelled or identified as parallel > imports, if such requirements benefit consumers and do not > present unreasonable restrictions on trade in parallel > goods. > > Appendix > > TRIPS Articles 6, 13 and 30 > > Article 6 > Exhaustion > >For the purposes of dispute settlement under this Agreement, >subject to the provisions of Articles 3 and 4 nothing in this >Agreement shall be used to address the issue of the exhaustion of >intellectual property rights. > > Article 13 > Limitations and Exceptions > (copyright) > >Members shall confine limitations or exceptions to exclusive >rights to certain special cases, which do not conflict with a >normal exploitation of the work and do not unreasonably prejudice >the legitimate interests of the right holder. > > > Article 30 > Exceptions to Rights Conferred > (patents) > >Members may provide limited exceptions to the exclusive rights >conferred by a patent, provided that such exceptions do not >unreasonably conflict with a normal exploitation of the patent >and do not unreasonably prejudice the legitimate interests of the >patent owner, taking account of the legitimate interests of third >parties. > > ><-------- -----------EC Services Response-------------------> > >EUROPEAN COMMISSION SERVICES' RESPONSE > >The European Commission services take note of the Recommendations >made by the TACD on matters relating to the protection of >intellectual property rights in the framework of electronic >commerce. The emerging Information Society will bring new >challenges to the protection of intellectual property rights. A >number of these challenges resulting from the digital environment >have already been addressed in two international treaties adopted >in December 1996 under the auspices of the World Intellectual >Property Organisation (WIPO Copyright Treaty and WIPO >Performances and Phonograms Treaty). They represent a major step >forward in providing for adequate protection of authors, >performers and phonogram producers in the digital environment. >The Draft Directive on Copyright and Related Rights in the >Information Society plays a crucial role in this context. The >aim of this proposal is to adjust and complement the existing EU >framework on copyright and related rights to provide for a >Community-wide level playing field in the digital environment, >which ensures public acceptance of the new services and fosters >creativity and investment in them. At the same time, the draft >Directive serves to implement the main obligations of the two >WIPO treaties signed by the European Community and Member States >in the course of 1997. The European Community and the Member >States are currently in the process of ratifying and implementing >these treaties. Citizens will benefit from a harmonised legal >framework on copyright and related rights, including appropriate >exceptions to these rights, as well as the conditions of their >application. Such a harmonisation is crucial in order to >facilitate cross-border exploitation of copyright protected goods >and services, including their dissemination to users. The TABD >has already stressed the need for swift ratification and >implementation of the two treaties by the U.S., the EU and other >third countries. > >The TRIPs Council has just begun to look into matters related to >the impact of electronic commerce on the protection of >intellectual property rights. Further discussions will be held in >the near future to examine the current provisions of the TRIPs >Agreement and the possible need to adapt them to the new >developments. > >On the general introduction to the Recommendations, it should be >noted that authors and related right holders have an interest >not only to receive protection against commercial exploitation of >their works and other subject matter, but also against their >illegal exploitation by private users. Access to works is, >naturally, facilitated through publication. As regards reverse >engineering, Article 6 Council Directive No. 91/250/EEC on the >Legal Protection of Computer Programs already provides for this >facility in order to achieve the interoperability of computer >programs with other programs. > >The need for limitations and exceptions to copyright and related >rights for certain uses, such as for educational use >(Recommendation No. 1), private copying, library use and research >(Recommendation No. 3) has always been recognised, in the >international conventions as well as in the EC "acquis >communautaire" on copyright and related rights, including >proposed legislation which explicitly allows for exceptions for >specific uses. However, the economic impact of any such >exception in the new technological environment may be different >compared to the traditional environment. The scope of certain >exceptions may therefore need to be re-assessed in the light of >the new environment, in order to avoid economic damage to the >market of protected works and other subject matter. > >In general, conflicts between privacy and copyright protection >should not arise (Recommendation No. 2). As far as personal data >are concerned, Directive No. 95/46/EC on the Protection of >Individuals with regard to the Processing of Personal Data and on >the Free Movement of such Data, also applies to the area of >copyright and related rights, thereby ensuring adequate >mechanisms to respect privacy. > >Article 13 of TRIPs Agreement (Recommendation No. 4) provides for >the possibility to allow limitations and exceptions to copyright >and related rights based on the corresponding Article 9, >paragraph 2 of Berne Convention. Given the different nature of >industrial property, the corresponding provisions in the patent >area (Article 30 of TRIPs Agreement) also requires account to be >taken of the "legitimate interests of third parties". > >The creation of works, notably software, often requires >considerable creativity and deployment of skill and labour >(Recommendation No. 5). Authors are vested with intellectual >property rights. It is, therefore, up to the author to decide if >and when to allow third parties to use his works against the >payment of a fee or not. While it is true that public domain and >non-commercial software play an important role in public and >commercial life, this must not undermine the author's legitimate >interest in receiving adequate compensation for exploitation of >his property. > >On the protection of databases (Recommendation No. 6), Directive >No. 96/9/EC on the Legal Protection of Databases allows Member >States to provide for a number of exceptions to the rights of >authors and makers of databases conferred under the Directive, >including for private purposes, teaching and scientific research, >etc. It, therefore, strikes a careful balance between the >interests of authors and makers of databases and of users. With >regard to possible anti-competitive practices in the area of >databases, it has to be recalled that the exercise of >intellectual property rights is subject to the provisions of >competition law. Moreover, the Directive provides for rights in >databases or in substantial parts of databases, but not in facts. > >With regard to patents on so-called "business practice patents" >(Recommendation No. 7), currently Article 52 of the European >Patent Convention excludes from the scope of patentable >inventions "schemes, rules and methods for doing business". >Therefore, the request by the TACD to solicit public comments and >hold public hearings in this respect would not be of any >additional value at the moment. > > >The question of parallel imports, i.e. the exhaustion of >exclusive rights (Recommendation No. 8), remains very sensitive. >The TRIPs Agreement leaves it up to the WTO Members whether or >not to allow parallel importation. The European Commission has >commissioned, in the area of trademarks, a study on the impact of >parallel imports which was discussed with the interested parties >in April 1999. The European Commission is currently evaluating >the outcome of the study and the comments received in order to >review the current system of regional exhaustion in the >Community. In this respect it has to be noted that the TABD >expressed its opposition to the international exhaustion of >intellectual property rights. > > >-- >James Love / Director, Consumer Project on Technology >http://www.cptech.org / [EMAIL PROTECTED] >P.O. Box 19367, Washington, DC 20036 >voice 202.387.8030 / fax 202.234.5176 Respectfully, Jay Fenello, New Media Relations ------------------------------------ http://www.fenello.com 770-392-9480 "We are creating the most significant new jurisdiction we've known since the Louisiana purchase, yet we are building it just outside the constitution's review." -- Larry Lessig, Harvard Law School, on ICANN
