FFII note on the Legal Service’s Opinion on ACTA

December 20, 2011
By Ante

We welcome the decision to release the European Parliament legal service’s opinion on ACTA (Anti-Counterfeiting Trade Agreement). We have compared the legal service’s opinion with multiple academic opinions on ACTA and some civil society analyses.

(pdf version)

1. Conclusion

We found that many issues pointed out by academic opinions and the study commissioned by the EP International Trade committee (INTA) are not addressed by the legal service’s opinion.

The legal service fails to see major issues with damages, injunctions and provisional, border and criminal measures. The legal service consistently overlooks known issues. Taking the issues the legal service did not address into consideration, it is clear that ACTA goes beyond current EU law, the acquis.

The legal service underestimates problems with Internet governance and access to medicine. It fails to see ACTA is not compatible with fundamental rights, international agreements and the EU Treaties.

1.1 Compatibility with EU law

Regarding damages, the legal service overlooks that ACTA’s damages based on retail price lead to damages based on an imaginary gross revenue, which is way beyond actual loss suffered. This issue has been pointed out by NGOs, the European academics Opinion and the EP INTA study. We provide some simple examples which show that ACTA’s damages are much higher than EU law damages.

Regarding border measures, both the European Academics Opinion on ACTA and the EP INTA committee study had pointed out there is a serious issue with the condition “not discriminate unjustifiably”. The Commission did not provide the justification to limit ACTA to EU law. While the legal service quotes article 13 ACTA, it leaves out the condition. Since DG-Trade and the US Trade Representative undermine the Doha Declaration in other fora, there is also a threat to access to medicine.

The legal service does not address the issues with injunctions and provisional measures, pointed out in multiple academic opinions.

The legal service does not mention dispute resolution panels, while such external panels may be a serious threat to a favorable interpretation of ACTA.

1.2 Criminal measures

The legal service fails to see ACTA removes the scale element from the definition of the crime. The legal service fails to notice ACTA criminalises everyday computer use. ACTA can be used to criminalise newspapers and websites revealing a document, office workers forwarding a file, people making a private copy and whistle-blowers revealing documents in the public interest. ACTA also criminalises aiding and abetting, which puts pressure on Internet Service Providers, who may decide to pre-emptively censor Internet communications.

1.3 Internet

ACTA’s heightened measures will apply to the digital environment as well. This will put pressure on Internet Service Providers, who may decide to pre-emptively censor Internet communications.

The legal service does not mention the obligation in ACTA art 27.3 to endeavour to promote cooperative efforts within the business community. ACTA incites privatised enforcement outside the rule of law.

1.4 Fundamental rights

To establish whether ACTA violates fundamental rights, fair balance tests are needed. The legal service does not provide any fair balance test. The 61 pages Douwe Korff & Ian Brown opinion provides many such tests. These tests show ACTA is manifestly incompatible with fundamental rights. Just providing a general reference to fundamental rights is not enough.

The ARTICLE 19 organisation “finds that ACTA fundamentally flawed from a freedom of expression and information perspective. If enacted, it will greatly endanger the free-flow of information and the free exchange of ideas, particularly on the internet.”

Korff & Brown conclude: “Overall, ACTA tilts the balance of IPR protection manifestly unfairly towards one group of beneficiaries of the right to property, IP right holders, and unfairly against others, equally disproportionally interferes with a range of other fundamental rights, and provides for (or allows for) the determination of such rights in procedures that fail to allow for the taking into account of the different, competing interests, but rather, stack all the weight at one end.

This makes the entire Agreement, in our opinion, incompatible with fundamental European human rights instruments and -standards.”

1.5 International agreements

The legal service does not address the global pricing problem and the right to take part in cultural life. ACTA is not compatible with article 15 of the UN International Covenant on Economic, Social and Cultural Rights (ICESCR).

The ARTICLE 19 organisation also notes issues with Article 15 of the ICESCR, and with articles 17 and 19 of the UN International Covenant on Civil and Political Rights (ICCPR).

1.6. EU Treaties

ACTA is not compatible with article 21 Treaty on European Union (TEU): “The Union’s action on the international scene shall be guided by the principles (…): democracy, the rule of law, the universality and indivisibility of human rights and fundamental freedoms (…)”

Nor is ACTA compatible with articles 3.3, 3.5 and 5 Treaty on European Union.

1.7 Public health

The legal service mentions references to the TRIPS agreement and the Doha Declaration in the ACTA text. But the combination of heightened measures with a non binding reference to the Doha Declaration, and undermining the Doha Declaration in other fora does not provide sufficient safeguards for access to medicine.

1.8 Policy space

ACTA will foreclose future legislative improvements in response to changes in technology or policy. EU law is relatively new and under review, the Union needs to retain policy space.

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2. Analysis

2.1. Compatibility with EU law

Taking the issues the legal service did not address into consideration, it is clear that ACTA goes beyond current EU law, the acquis.

2.1.1 Damages

2.1.1.1 Damages and current EU law

Paragraph 26 (page 14) concludes the compulsory aspect is similar. But ACTA introduces damages based on retail price. This leads to damages based on an imaginary gross revenue, which is way beyond actual loss suffered. This issue has been pointed out by NGOs, the European academics and the INTA study. Basically, ACTA combines two leverage tricks, from profits to gross revenues, and from actual to imaginary losses.

We provide three simple examples which show that ACTA’s damages are much higher than EU law damages. Actually, ACTA’s damages upset millennia of legal tradition.

A. A 2 terabyte hard disk can contain 540.000 songs. Someone copies a hard disk full of songs. Based on retail price, say 1 euro per song, the rights holder can claim 540.000 euro under ACTA art 9.

Art 9: “Each Party shall provide that, in civil judicial proceedings concerning the enforcement of intellectual property rights, its judicial authorities have the authority to order the infringer who, knowingly or with reasonable grounds to know, engaged in infringing activity to pay the right holder damages adequate to compensate for the injury the right holder has suffered as a result of the infringement. In determining the amount of damages for infringement of intellectual property rights, a Party’s judicial authorities shall have the authority to consider, inter alia, any legitimate measure of value the right holder submits, which may include lost profits, the value of the infringed goods or services measured by the market price, or the suggested retail price.”

Art 9 first speaks of adequate damages. Then in the second sentence, ACTA mentions “any legitimate measure”, and then not only mentions lost profits, but also “the value of the infringed goods or services measured by the market price, or the suggested retail price.”

Under ACTA, the rights holder can claim 540.000 euro. And the judicial authorities shall have the authority to consider this. This is clearly an enormous threat for a consumer, organisation or company.

Under current EU law this would not be possible. Under current EU law, damages are based on actual loss suffered, including lost profits. Profits are always less than gross revenue, and certainly less than imaginary gross revenues.

Someone may not buy music often, but after copying a disk and hearing the music, may buy more music, visit concerts more often. The actual lost profit is zero (and even negative). This is not a outlandish example, as multiple studies show the biggest downloaders are also the biggest buyers.

B. There are libraries full of old magazines, etc. They have no real commercial value any more. Mass digitization projects bring them to a new public. Yet, under ACTA, the retail price damages may lead to a claim of millions or billions euro. Such claims can be awarded. The threat of such a claim has a chilling effect.

C. In a knowledge society, exceptions and limitations on copyright create important opportunities for new companies (for instance Google, etc). But start ups can face claims of millions or billions euro under ACTA.

2.1.1.2 Damages and fundamental rights

Above we saw that ACTA’s damages are extremely high, combine two leverage tricks. The ARTICLE 19 organisation notes: “Calculating damages in this manner, particularly in the context of peer-to-peer sharing, will lead to astronomic compensation awards that are grossly disproportionate to the actual harm suffered and the seriousness of the infringing conduct.”

Douwe Korff & Ian Brown note: “Similar considerations apply in respect of the mandatory awarding of disproportionate damages for IPR infringements against users to right holders. The EU academics show beyond doubt that ACTA in this respect too departs significantly from accepted assessments. Of course, money taken from defendants, and handed to right holders constitutes an interference with the formers’ property rights – indeed, a deprivation of their property. If in this ACTA fails to strike a “fair balance” then, as we have already noted, that will ipso facto amount to a violation of the defendants’ property rights.

Under the ECHR, the assessment of the level of damages in civil proceedings is very largely left to the States: the European Court of Human Rights will only very marginally assess the compatibility of such an assessment with the Convention.

However, if the rules underpinning that assessment are manifestly skewed against one party, this changes: in such a case, the Court would find a violation of the right to property.

In our opinion, here too ACTA is deficient: without express clarification to the effect that damages awarded to right holders must be a reasonable reflection of actual loss, equitably assessed by a court (rather than an exaggerated assessment based on an unchallengeable but rigged formula), the Agreement violates both the right to property and the right to a fair (civil) trial of the defendants.”

2.1.2. Border measures

Paragraph 22 (page 14) legal service’s opinion makes clear ACTA has a broader scope.

Paragraph 23 “However”, cites ACTA art 13, which consists of just one sentence. The opinion only cites the first half of this sentence. The legal service leaves out a condition: “for effective border enforcement of intellectual property rights, a Party should do so in a manner that does not discriminate unjustifiably between intellectual property rights and that avoids the creation of barriers to legitimate trade.”

Civil society, the European Academics Opinion on ACTA and the EP INTA committee study had pointed out there is a serious issue with the condition “not discriminate unjustifiably”, in the second part of the sentence. Without justification, the EU can not limit ACTA’s border measures to current EU law.

EP INTA study: It may be possible to argue that Article 13 provides a way to exclude certain kinds of infringements from the application of border measures, as the Commission does,104 but the difficulty will be establishing what constitutes a justifiable discrimination between types of intellectual property as required by the article. In particular, where the Commission seems to be of the view that such extension is optional under ACTA, the text of Article 13 is clear that unless ‘justified’ border measures cannot exclude all trademark infringements. In the context of the history of exceptions and exclusions allowable or justifiable under the TRIPS Agreement, these may be restricted to those that meet the criteria of Article 8.1 TRIPS, regarding public health and protection of the environment. The Commission has yet to provide what its argument would be for justifiably reducing the scope of application of border measures only to counterfeit trademark goods.”

Without a justification, the EU can not limit ACTA’s border measures to EU law. There still is no such justification. Border officials will have to deal with subtle and unclear infringements.

Regarding access to medicine, the Doha Declaration may provide a justification. But, it is important to note that the latest US and EU interpretation of the Doha Declaration is more limited than the original WTO interpretation.

James Love: “So, when the NCD discussion began at the UN, the Obama White House and DG-Trade saw this as an opportunity to try, again, to make the case that the 2001 Doha agreement, and the 2003 TRIPS waiver for exports, do not apply to NCDs. Given the timing of the decision, this puts at risk the current understanding that the Doha Declaration applies to everything.” (NCD: Non-communicable disease) (KEI-1267)

Since DG-Trade and the US Trade Representative undermine the Doha Declaration in other fora, ACTA’s extended border measures are also a threat to access to medicine.

Paragraph 24 legal service’s opinion mentions interpretation by European courts. The outcome will be unsure. The legal service does acknowledge this in its analysis. The legal service only uses “subject to interpretation” in its conclusions, which is weaker.

Furthermore, and the legal service does this throughout the document, the legal service mentions courts looking at it, but does not mention dispute resolution panels. Such an external panel may be a serious threat to a favorable interpretation. In such a procedure it may not be helpful the Commission wanted a broad scope during the negotiations and undermines the Doha Declaration.

2.1.3. Injunctions and provisional measures

2.1.3.1. Injunctions, provisional measures and current EU law

The legal service does not address issues with injunctions and provisional measures. There are at least three issues.

A. Both the European academics and the EP INTA study noted that ACTA does not contain an option to order pecuniary compensation to be paid to the injured party instead of applying injunctions. Academics: “It seems that this option would be lost or at least called into question if art. 8.1 ACTA were enacted in its present form.” INTA study: “It seems that this option would be lost or at least called into question if art. 8.1 ACTA were enacted in its present form.”

B. The European academics point out ACTA contains provisional measures inaudita altera parte, but does not at the same time take up the procedural guarantees which have been introduced in Directive 2004/48 and which are necessary to ensure that persons concerned by such proceedings have a later opportunity to challenge these measures.

The EP INTA study proposes annotating the text with additions from the TRIPS Agreement outlining the mandatory safeguards that ACTA has omitted to mention in areas such as provisional measures. But this approach does not solve the issues raised by Korff and Brown, see the next section on Injunctions, provisional measures and fundamental rights (2.1.3.2.).

C. The FFII pointed out ACTA has a broader formulation of third party than the current EU legislation: “ACTA also contains injunctions against third parties (Art 8.1). ACTA adds “inter alia” and has a broader formulation of third party than the current EU legislation. ACTA includes third parties who are not intermediaries, like suppliers of raw materials and software. This may impact access to medicine and the ICT sector.” (FFII)

2.1.3.2. Injunctions, provisional measures and fundamental rights

Douwe Korff & Ian Brown: “All “civilised” legal systems that provide for such extraordinary special processes also provide for such special counter-balancing safeguards. In the EU, it might perhaps be assumed that States will indeed only ever allow for the use of the extraordinary measures envisaged in ACTA (and especially for inaudita proceedings in IPR cases) in circumstances where this is exceptionally clearly warranted; and that they will surround those measures, also in IPR cases, with the kinds of counter-balancing safeguards they also provide for such special measures in other civil cases.

ACTA does not require this. This has two potentially pernicious effects. First, it might suggest to European States that the extraordinary measures should be seen as less extraordinary – perhaps even normal – when it comes to IPR enforcement; and that there is less need for counter-balancing safeguards. Secondly, it appears to signal to other countries that perhaps are less sensitive to defendants’ rights that a defendant-unfriendly approach is acceptable in IPR matters.

In terms of the ECHR, the first would amount to a clear violation of the Convention. And any complicity by the EU in the undermining of that principle in third countries would violate the principle in the Treaty that the EU will encourage respect for human rights in such other countries.

In our opinion, without clear provisions stressing that injunctions should be the exception, and inaudita proceedings the high exception, and that for both, there must be strong counter-balancing safeguards to preserve the “equality of arms” in IPR enforcement proceedings, ACTA is incompatible with the “fair trial” guarantees in the ECHR and the CFR.”

2.2. Criminal measures

2.2.1 ACTA compared with TRIPS

Before people had computers, it took an effort to infringe copyright. One had to make a physical copy. Since people have computers, infringement is often just one mouse click away. With infringements so near, it is essential that countries retain the policy space to find a proportional solution.

Comparing ACTA with the TRIPS agreement (paragraph 43), the legal service notes that the definition of commercial scale in ACTA seems prima facie to encompass a broader sphere of activities. This is an understatement.

The 1994 WTO TRIPS agreement contains criminal measures against wilful trademark counterfeiting or copyright piracy on a commercial scale. The TRIPS agreement leaves commercial scale undefined. In the US versus China case, the WTO dispute settlement panel defined commercial scale as: “typical or usual commercial activity with respect to a given product in a given market”. This definition leaves countries policy space to find a proportional solution.

ACTA deliberately replaces this definition with: “commercial activities for direct or indirect economic or commercial advantage”. Note that this definition does not contain a minimum threshold (de minimis exception). ACTA removes the scale element from the definition of the crime. ACTA does not have a public interest exemption either.

ACTA criminalises everyday computer use. ACTA can be used to criminalise newspapers and websites revealing a document, office workers forwarding a file, people making a private copy and whistle-blowers revealing documents in the public interest. ACTA criminalises almost everyone with a computer – who never forwarded an email? ACTA also criminalises aiding and abetting, which puts pressure on Internet Service Providers, who may decide to pre-emptively censor Internet communications.

Countries should not take upon them the obligation to criminalise everyday computer use. We may rather need to rethink the relationship between computer use, and copyright and enforcement, than impose blanket criminalisation. We need to retain the policy space to find a proportional solution.

The legal service fails to notice ACTA criminalises everyday computer use.

2.2.2. ACTA compared with European Parliament position

The legal service compares ACTA’s criminal measures with the Parliament’s 2007 position on IPRED 2 (Proposal for a Directive on criminal measures aimed at ensuring the enforcement of intellectual property rights). (paragraphs 31 and 32)

Regarding the definition of commercial scale, the legal service does not notice the considerable issues. These issues have been noted by the FFII, the European academics, the EP INTA study and Korff and Brown. The INTA study uses the word “clash”: “This may clash with broad definition of “commercial scale” used in ACTA.” The European Data Protection Supervisor noted: the ‘commercial scale’ criterion is decisive.

ACTA does not have the fair use exception the Parliament made. The legal service notes that EU countries can introduce or maintain such exceptions on the basis of article 5 Copyright directive. But material exceptions are different than procedural exceptions. The legal service’s approach takes away the option to make an act an infringement, but not a crime. Furthermore, fair use may be more flexible than the Copyright directive exceptions.

Regarding the scope of ACTA, the legal service notes the Parliament excluded parallel imports. NGOs, European academics and the EP INTA study noted that such exclusion is not reflected in ACTA. The legal service does not address this issue. Parallel import is (also) important for access to medicine.

2.2.3 Criminal measures and fundamental rights

The ARTICLE 19 organisation notes regarding the definition of commercial scale:

“This terminology is as vague as it is broad, and if transplanted directly into domestic criminal law would not be considered to have the qualities of legal accessibility or certainty required by Article 19 of the ICCPR.

The concept of ‘indirect economic advantage’ potentially encompasses innocuous copyright infringements that would not ordinarily be considered ‘commercial’. For example, an individual transferring a digital copy of a book between their electronic devices in breach of copyright may receive an “indirect” economic advantage by avoiding the cost of buying a second copy. The language of ACTA allows such conduct and similar trivial infringements to be framed as criminal, and therefore worthy of punitive custodial sentences, fines, and a permanent criminal record.”

Douwe Korff & Ian Brown: “In our opinion, ACTA, by not including a de minimis exception to its compulsory and draconian enforcement regime, fails to ensure adequate protection of the right to freedom to obtain and disseminate information, the right to freedom from unreasonable search and arrest, the right to inviolability of the home, and the right to the peaceful enjoyment of one’s possessions, and thus violates those rights.”

2.3. Internet

In paragraph 17 (page 3) the legal service notes: “Furthermore, the conclusion of ACTA would not require the EU to adapt its acquis regarding measures relating to the digital environment.”

This is only true if the EU does not have to adapt its acquis at all. We already saw that the legal service overlooked issues with damages, injunctions, and provisional and criminal measures. These heightened measures will apply to the digital environment as well. This will put pressure on Internet Service Providers, who may decide to pre-emptively censor Internet communications.

The legal service does not mention the obligation in ACTA art 27.3: “Each Party shall endeavour to promote cooperative efforts within the business community to effectively address trademark and copyright or related rights infringement while preserving legitimate competition and, consistent with that Party’s law, preserving fundamental principles such as freedom of expression, fair process, and privacy.”

The text mentions fundamental principles, not fundamental rights. The business community can not guarantee fundamental rights. ACTA incites privatised enforcement outside the rule of law.

This is not compatible with article 21 TEU, the Union’s action on the international scene shall be guided by the principles of democracy and the rule of law, the universality and indivisibility of human rights and fundamental freedoms (…).

2.4. Fundamental rights

2.4.1 Safeguards or fig-leaves?

The legal service concludes in paragraph 40 d) that it “appears that the Agreement per se does not impose any obligation on the Union that is manifestly incompatible with fundamental rights. On the contrary, several provisions of ACTA provide for the respect of fundamental rights when the Contracting Parties implement the proposed Agreement.”

This is in strong contrast with the European academics and Korff & Brown. Douwe Korff & Ian Brown, fundamental rights experts, conclude: “Human rights were effective ignored, apart from the inclusion in the Agreement of vague and ineffective “without prejudice” clauses that fail to redress the balance, and are little more than fig-leaves.”

Are the safeguards in ACTA effective or little more than fig-leaves?

First, damages, injunctions, and provisional, border and criminal measures are intrusive. They need precise limits.

Secondly, we already saw that the legal service overlooked issues with damages, injunctions, and provisional, border and criminal measures. The measures in ACTA are more intrusive than the legal service acknowledges.

Thirdly, to establish whether ACTA violates fundamental rights, fair balance tests are needed. The legal service does not provide any fair balance test. The 61 pages Douwe Korff & Ian Brown opinion provides many such tests.

Such tests show which limitations are needed. As we saw above, for damages the keywords are: reasonable reflection of actual loss, equitably assessed by a court. For injunctions and inaudita proceedings the keywords are: exception, high exception and counter-balancing safeguards. For criminal measures the keywords are: de minimis exception and public interest exception. For more fair balance tests, see the Douwe Korff & Ian Brown opinion.

ACTA does not provide such limitations, ACTA is manifestly incompatible with fundamental rights. Just providing a general reference to fundamental rights is not enough.

Implementing ACTA takes a serious rewrite of ACTA. This will not be easy as both the Commission and the EP legal service consistently overlook major issues. It will lead to many years of legal uncertainty and fundamental rights violations before things are sorted out by courts.

In third countries with less protection of fundamental rights, the situation will be worse, the EU violates article 21 Treaty on European Union: “The Union’s action on the international scene shall be guided by the principles which have inspired its own creation, development and enlargement, and which it seeks to advance in the wider world: democracy, the rule of law, the universality and indivisibility of human rights and fundamental freedoms, respect for human dignity, the principles of equality and solidarity, and respect for the principles of the United Nations Charter and international law.”

2.4.2 General conclusions

ARTICLE 19 “finds that ACTA fundamentally flawed from a freedom of expression and information perspective. If enacted, it will greatly endanger the free-flow of information and the free exchange of ideas, particularly on the internet.”

Douwe Korff & Ian Brown conclude: “Overall, ACTA tilts the balance of IPR protection manifestly unfairly towards one group of beneficiaries of the right to property, IP right holders, and unfairly against others, equally disproportionally interferes with a range of other fundamental rights, and provides for (or allows for) the determination of such rights in procedures that fail to allow for the taking into account of the different, competing interests, but rather, stack all the weight at one end.

This makes the entire Agreement, in our opinion, incompatible with fundamental European human rights instruments and -standards.”

2.5. International agreements

2.5.1 Global pricing problem

The legal service does not address the global pricing problem and the right to take part in cultural life.

In emerging economies, CDs and DVDs are often sold for the same prices as in the US and Europe. Relative to local incomes in Brazil, Russia, or South Africa, the price of a CD, DVD, or copy of Microsoft Office is five to ten times higher than in the United States or Europe, the Media Piracy in Emerging Economies report shows. There is no distribution of legal CDs and DVDs outside the capitals. Some 90% of the people in emerging economies can only turn to illegal media copies.

We all know pictures of big piles of illegal CDs to be destroyed by a bulldozer. We may think: finally country X takes action against piracy. The real story behind these pictures is that these illegal copies are the only way 90% of the people in emerging economies can enjoy software, music and movies. The costs in social welfare of harsh measures are enormous.

Some 90% of the people in emerging economies are dependent on illegal copies. This is not compatible with the UN International Covenant on Economic, Social and Cultural Rights (ICESCR), which recognizes the right of everyone to take part in cultural life; and to enjoy the benefits of scientific progress and its applications (art 15.1 (a) and (b)).

This is already happening under the TRIPS agreement.

ACTA’s damages will change the situation for the worse. Someone in an emerging economy selling 100 illegal copies of a CD for 2 euro, has a gross revenue of 200 euro. With damages based on retail price, he may have to pay 2000 euro damages (100 x 20), ten times his gross revenue. The actual loss suffered may be zero, as there is no distribution of legal CDs outside the capitals, and almost none of his clients would have been able to pay the retail price.

And add the criminal measures to this, which turn against consumers as well.

2.5.2. ICESC and ICCPR

The ARTICLE 19 organisation also notes issues with Article 15 of the ICESCR, and with articles 17 and 19 of the UN International Covenant on Civil and Political Rights (ICCPR).

2.6. EU Treaties

In the sections on Internet and Fundamental rights we already mentioned ACTA is not compatible with article 21 TEU.

Above we saw ACTA makes the global pricing problem worse. Exporting such draconian measures is not compatible with article 21 TEU either. Nor is it compatible with art 3.5 Treaty on European Union: “In its relations with the wider world, the Union shall uphold and promote its values and interests and contribute to the protection of its citizens. It shall contribute to peace, security, the sustainable development of the Earth, solidarity and mutual respect among peoples, free and fair trade, eradication of poverty and the protection of human rights, in particular the rights of the child, as well as to the strict observance and the development of international law, including respect for the principles of the United Nations Charter.”

In Eastern Europe the incomes are much lower than in Western Europe, creating a regional pricing problem much like the global pricing problem.

Euractive.com reports:

“Ivan Dikov writes in an op-ed with the Bulgarian news website Novinite that Bulgaria is a country much poorer than the remaining ACTA signatories and could not in fact assume the same responsibilities.

Torrent sites such as Zamunda and Arena are the most popular websites in Bulgaria. The reason for that is not just the enormous amount of music, films, software, and books that they make available to anybody for free. The sites are not accessible from outside the country.

These torrent sites are technically in violation of all sorts of copyright laws but what they offer has no alternative for the people in Bulgaria for the time being given the country’s social and economic development, Dikov argues.”

ACTA makes this regional pricing problem worse. ACTA is not compatible with art 3.3 TEU: “It shall combat social exclusion and discrimination, and shall promote social justice and protection, equality between women and men, solidarity between generations and protection of the rights of the child.”

ACTA is fundamentally disproportional. Adding a reference to proportionality does not solve this, a violation of art 5 TEU.

The legal service does not mention that if the EU would like to exercise its competence to ratify ACTA’s criminal measures, the measures have to be proven essential to ensure the effective implementation of a Union policy in an area which has been subject to harmonisation measures (art 83.2 TFEU).

EP INTA study: “Whether the criminal measures proposed under ACTA fulfill this standard of essentiality is questionable, particularly in view of the debate that has been ongoing since the IPRED2 was proposed. Several scholars and the Dutch Parliament have expressed their serious concerns whether such criminal measures, which are similar to those included in ACTA, fulfill the standard of subsidiarity. The same questions would arise in the context of the criminal measures proposed by ACTA.”

2.7. Public health

The legal service refers a few times to ACTA’s provisions on the TRIPS agreement and the Doha Declaration.

The Doha Declaration is mentioned only once in the non binding ACTA preamble: “Recognizing the principles set forth in the Doha Declaration on the TRIPS Agreement and Public Health, adopted on 14 November 2001, at the Fourth WTO Ministerial Conference;”

The TRIPS agreement is mentioned twice in the non binding preamble, above and: “Intending to provide effective and appropriate means, complementing the TRIPS Agreement, for the enforcement of intellectual property rights, taking into account differences in their respective legal systems and practices;”

The Doha Declaration is not mentioned in ACTA’s articles, TRIPS is mentioned a few times:

Article 1 “Nothing in this Agreement shall derogate from any obligation of a Party with respect to any other Party under existing agreements, including the TRIPS Agreement.”

Article 2.3 “The objectives and principles set forth in Part I of the TRIPS Agreement, in particular in Articles 7 and 8, shall apply, mutatis mutandis, to this Agreement.”

Article 13: “In providing, as appropriate, and consistent with its domestic system of intellectual property rights protection and without prejudice to the requirements of the TRIPS Agreement, for effective border enforcement of intellectual property rights, a
Party should do so in a manner that does not discriminate unjustifiably between intellectual property rights and that avoids the creation of barriers to legitimate trade.”

ACTA also uses the TRIPS definition of intellectual property rights, and mentions TRIPS in the article on injunctions.

The Doha Declaration is not mentioned explicitly in the articles. The legal service notes that the TRIPS agreement includes the Doha Declaration. This would provide enough certainty for parties.

Above, in the section on border measures, we saw that the latest US and EU interpretation of the Doha Declaration is more limited than the original WTO interpretation. The combination of a non binding reference to the Doha Declaration and undermining the Doha Declaration in other fora does not provide full certainty. Rather, the pressure is on.

Above, in the section on border measures, we already saw that the legal service only quotes the first half of ACTA article 13, leaving out the condition “not discriminate unjustifiably”.

Above, in the section on criminal measures, we say the legal service does not address the issue with criminalisation of parallel import.

Health groups and an academic study point out issues regarding access to medicine.

Oxfam Statement regarding ACTA and Public Health: “ACTA will undoubtedly impact access to affordable medicines in the EU and other signatories by curbing generic competition. There are great concerns that ACTA’s impact will extend beyond those countries that initially sign the Agreement, potentially undermining access for millions of patients in developing countries who depend on affordable, quality generics.”

Public Citizen regarding access to medicine. Public Citizen raised concerns that the purported benefits of ACTA for public safety would be slim at best. Meanwhile, ACTA’s opportunity cost for more effective measures against unsafe products could be significant. Further, ACTA may impose direct costs on public health, by creating uncertainty and financial disincentives for the shipping of generic medicines. Public Citizen strongly advises a deeper and more considered legal review of ACTA.

The Greens / EFA group commissioned study on ACTA and Access to Medicines. This study by Sean Flynn with Bijan Madhani concludes that ACTA increases the risks and consequences of wrongful searches, seizures, lawsuits and other enforcement actions for those relying on intellectual property limitations and exceptions to access markets, including the suppliers of legitimate generic medicines. This, in turn, is likely to make affordable medicines more scarce and dear in many countries.

FFII’s own analysis regarding technology concludes that ACTA’s heightened measures may hinder development and availability of medical equipment, diagnostic methods and instruments; will restrict government flexibility, impede innovation and slow the development and diffusion of green technology. (FFII-675)

ACTA’s heightened measures impact access to affordable medicines, while its safeguards do not provide certainty.

2.8 Policy space

ACTA will foreclose future legislative improvements in response to changes in technology or policy. EU law is relatively new and under review, the Union needs to retain policy space.

3. References

ARTICLE 19 http://www.article19.org/resources.php/resource/2901/en/european-parliament:-reject-anti-counterfeiting-trade-agreement-%28acta%29 (Statement published 15 December 2011, after the legal service’s opinion)

Douwe Korff & Ian Brown, Opinion on the compatibility of the Anti-Counterfeiting Trade Agreement (ACTA) with the European Convention on Human Rights & the EU Charter of Fundamental Rights, 2011 http://rfc.act-on-acta.eu/fundamental-rights

Euractive.com http://www.euractiv.com/infosociety/acta-activates-european-civil-society-news-510533

European Parliament INTA study http://www.erikjosefsson.eu/sites/default/files/DG_EXPO_Policy_Department_Study_ACTA_assessment.pdf

European Parliament legal service’s opinion on ACTA (contains the opinion requested by the EP INTA Committee, starting at page 9) http://christianengstrom.files.wordpress.com/2011/12/sj-0661-11_legal-opinion.pdf or
http://lists.act-on-acta.eu/pipermail/hub/2011-December/000072.html.

FFII-675 http://acta.ffii.org/?p=675

FFII http://action.ffii.org/acta/Analysis

KEI-1267 http://www.keionline.org/node/1267

Media Piracy in Emerging Economies, edited by Joe Karaganis http://piracy.ssrc.org

Opinion of European Academics on ACTA http://www.iri.uni-hannover.de/acta-1668.html

Opinion of the European Data Protection Supervisor on the current negotiations by the European Union of an Anti-Counterfeiting Trade Agreement, paragraph 44 http://www.edps.europa.eu/EDPSWEB/edps/Consultation/OpinionsC/OC2010

Oxfam Statement regarding ACTA and Public Health http://www.oxfamsol.be/fr/IMG/pdf/Oxfam_ACTA_analysis_FINAL.pdf

Public Citizen http://www.citizen.org/documents/Letter-to-Members-of-the-Committee-on-Legal-Affairs-on-the-ACTA.pdf

Sean Flynn with Bijan Madhani, ACTA and Access to Medicines http://rfc.act-on-acta.eu/access-to-medicines

5 Responses to FFII note on the Legal Service’s Opinion on ACTA

  1. [...] FFII provisional note on the Legal Service’s Opinion on ACTA On a request from Members Lichtenberger and Engström, the European Parliament Legal Affairs Committee decided to release the Legal Service’s Opinion on ACTA. You can find the documents here. [...]

  2. [...] FFII provisional note on the Legal Service’s Opinion on ACTA On a request from Members Lichtenberger and Engström, the European Parliament Legal Affairs Committee decided to release the Legal Service’s Opinion on ACTA. You can find the documents here. Share this post: These icons link to social bookmarking sites where readers can share and discover new web pages. [...]

  3. [...] FFII note on the Legal Service’s Opinion on ACTA We welcome the decision to release the European Parliament legal service’s opinion on ACTA (Anti-Counterfeiting Trade Agreement). We have compared the legal service’s opinion with multiple academic opinions on ACTA and some civil society analyses. Share this post: These icons link to social bookmarking sites where readers can share and discover new web pages. [...]

  4. [...] FFII note on the Legal Service’s Opinion on ACTA [...]

  5. Letter to EP Committee on Development | ACTA on January 23, 2012 at 10:20 am

    [...] FFII note on the Legal Service’s Opinion on ACTA [...]