Anti-Counterfeiting Trade Agreement 2011

The Anti-Counterfeiting Trade Agreement (ACTA) is multinational treaty signed by Australia, Canada, the EU, Japan, Korea, Mexico, Morocco, New Zealand, Singapore, Switzerland and the USA. The goal of the treaty is to standardise the enforcement of intellectual property rights among the Parties. The treaty requires the ratification of at least six nations to enter into force - to date, no country has given this approval.

Recent Developments

On 4th July 2012, the European Parliament overwhelmingly voted 478 to 39, with 165 abstentions, to reject ACTA. Commissioner Karel de Gucht announced that, regardless of the Parliament's rejection, the European Commission would wait for the ECJ's decision on the treaty's compatibility with fundamental rights and freedoms before considering what to do next.

This rejection follows the opposition to ACTA in all five of the committees ('Civil Liberties' (LIBE), 'Legal Affairs' (JURI), 'Industry Research and Energy' (ITRE), 'Committee on International Development' (DEVE) and leading Committee on International Trade (INTA)) tasked with investigating the treaty, and vocal public opposition to the disregard shown to fundamental democratic principles and protection of rights and freedoms.

The ECJ assessment was reported to have been dropped in December 2012.

Open Rights Group's Stance on ACTA

The Open Rights Group supports an open, evidence-based reappraisal of intellectual property policy, something that has been sorely lacking in the formulation of both ACTA and the UK's Digital Economy Act 2010. ACTA imposes extraordinary constraints on fundamental values such as freedom of expression and the right to privacy, and turns Internet intermediaries such as Internet service providers into the private police force of rights holders. ORG is delighted that, in rejecting ACTA, the European Parliament has recognised the Treaty's failure to safeguard these vital freedoms.

Criticism

Negotiation and Ratification Processes

A major source of controversy surrounding the treaty arises from the secret nature of the negotiations that led to it. This has prompted accusations that the negotiations were deliberately carried out in a way that bypassed the normal democratic and accountability procedures of both governments and international organisations such as the World Trade Organisation. Additionally the (at that point proposed) treaty only came to light when related documentation appeared on the whistle-blowing website, WikiLeaks. The European Council has been accused of trying to avoid debate about ACTA by passing the treaty at the end of meeting ostensibly about agriculture and fisheries.

On 26th January 2012 the European Parliament's rapporteur for ACTA, Kader Arif, resigned, expressing a wish to

"denounce in the strongest manner the process that led to the signing of this agreement: no association of civil society [and] lack of transparency from the beginning".

In a draft opinion released on 7th May 2012 EU rapporteur Dimitrios Droutsas MEP, of the Civil Liberties, Justice and Home Affairs Committee of the European Parliament (LIBE), suggested that the negotiatory process that led to ACTA was unsuitable and warned:

"your Rapporteur believes that ACTA comes at a very premature stage and a possible adoption of the Treaty would essentially freeze the possibility of having a public deliberation that is worthy of our democratic heritage. Against such a monumental challenge, what we absolutely need is that every expert we have, every affected organisation or institution we can spare, every citizen that desires to voice an opinion participates, from the beginning, in the creation of a modern social pact, a modern regime of protecting intellectual property rights. ACTA is not, and was not conceived to be, this. Instead, the Rapporteur believes that an adoption of ACTA would prematurely strangle the debate and tip the balance on one side, would allow for Member States to experiment on laws that could potentially harm fundamental freedoms and set precedents that could be undesirable for future societies."

Referral to the European Court of Justice

Widespread criticism of the treaty has prompted the European Commission to refer the matter to the European Court of Justice (ECJ). The referral process was completed on 11th May 2012. The ECJ will issue a decision as to ACTA's compatibility with other European treaties - in particular, the Charter of Fundamental Rights of the European Union.

On 27th March 2012 the Committee on International Trade (INTA) of the European Parliament voted not to send a separate referral of ACTA to the ECJ on behalf of the European Parliament meaning that the parliamentary vote on the matter would go ahead, as scheduled, in June. This move was welcomed by some activists, who had been concerned that a referral to the ECJ by INTA would have been a political "trap" to delay the vote until such time as ACTA was less prominent on the political agenda and could be passed without as much opposition. Philippe Aigrain, founder of La Quadrature du Net, welcomed the move, citing the democratic mandate of the European Parliament to make a decision as to whether to accept or reject ACTA:

"This vote is the first real test for the balance of views in the EU Parliament since the global anti-ACTA citizen movement took off. It demonstrates a growing understanding of ACTA's issues by a wide range of MEPs, and an ability to avoid the procedural traps set up by the EU Commission and some pro-ACTA MEPs. It is a promising step, but only the final rejection of ACTA will settle the issue."

However David Martin MEP, EU rapporteur for ACTA, said:

"Some thought that my proposal to refer ACTA to the Court of Justice was a political trick to delay the decision. My intention, on the contrary, was to shed some light that would help members of Parliament make their decision. However, MEPs today showed they are ready to vote. I am glad that the calendar is clear now and things will move faster. We need to stop discussing the procedure and start the political debate on the content."

Content of Agreement

In part due to its permissive (rather than prescriptive) nature, ACTA has been accused of presenting a significant danger to numerous public interests including the privacy of individuals in the digital environment.

Of particular concern to critics is the provision within Article 27 of the treaty, permitting organisations to involve themselves in the policing and punishment of those accused of rights infringement. The right to fair process is given a "vague reference", but is not enshrined or detailed further. Most alarmingly, the footnote to this assurance fails to consider the protection of fundamental rights and freedoms and, instead, suggests that Online Service Providers may be granted limited immunity against prosecution for their users' acts of infringement. EU rapporteur Dimitrios Droutsas MEP (LIBE committee) echoed these concerns when he released his draft opinion highlighting the lack of legal certainty and specificity in the terminology used to draft ACTA as potentially problematic for its implementation (specifically mentioning article 27). He also described the requirement for ISPs to hand over details of alleged infringers as "monitoring" and incompatible with the Charter of Fundamental Rights of the European Union.

Kader Arif's successor, David Martin MEP, recommended the European Parliament "decline to consent to the conclusion" of ACTA; noting that

"Unintended consequences of the ACTA text is a serious concern. On individual criminalisation, the definition of “commercial-scale”, the role of internet service providers and the possible interruption of the transit of generic medicines, your rapporteur maintains doubts that the ACTA text is as precise as is necessary. The intended benefits of this international agreement are far outweighed by the potential threats to civil liberties. Given the vagueness of certain aspects of the text and the uncertainty over its interpretation, the European Parliament cannot guarantee adequate protection for citizens' rights in the future under ACTA."

On the 24th April 2012 the European Data Protection Supervisor (EDPS), an independent supervisory authority, warned that the

"lack of precision of the Agreement about the measures to be deployed ... may have unacceptable side effects on fundamental rights of individuals, if they are not implemented properly" and that "measures that allow the indiscriminate or widespread monitoring of Internet users' behaviour, and/or electronic communications, in relation to trivial, small-scale, not for profit infringement would be disproportionate and in breach of Article 8 ECHR, Articles 7 and 8 of the Charter of Fundamental Rights, and the Data Protection Directive."

Although not opposed to the Treaty in principle, the European People's Party (EPP), a political alliance of 271 MEPs, has accepted that ACTA in its current form lacks 'legal clarity'. The Alliance of Liberals and Democrats (ALDE), a bloc of 85 MEPs, opposes the Treaty's ratification because of its lack of clarity and inability to balance "the right to protection of privacy and personal data and the right to receive or impart information". Other parties within the European Parliament, including the Progressive Alliance of Socialists and Democrats (S&D), European United Left/Nordic Green Left (GUE/NGL), and Greens/European Free Alliance (EFA), are also hostile to the Treaty.

Support

Proponents of ACTA have defended the covert approach to negotiation, suggesting that it is usual practice for economic negotiations to be carried out in this fashion and for those involved to exercise a certain level of "discretion". They have defended the treaty itself by saying that its intended scope relates only to large scale criminal activity, not to harassing consumers, and that it goes no further than current EU policies for IP rights enforcement.

Songwriter and musician Helienne Lindvall argues that the measures in ACTA are essential to prevent the "cultural equivalent of overfishing the lake", and that the treaty would not infringe individuals' rights. She suggests that much of the opposition to ACTA arises from people who have "been told it's a threat to freedom of speech and privacy" without reading its content.

In May 2012 Richard Mollet, head of the Publisher's Association, accused ACTA's opponents of "audacious hyperbole" and of riddling briefings with "inaccuracies and falsehoods". He asserts that the privacy issues raised by campaigners such as the Open Rights Group and Google are no more than "a cloak for tawdry theft".

Treaty Content

Full text of ACTA

Chapter I: Initial Provisions and General Definitions

Section 1: Initial Provisions

Article 1: Obligations pre-dating ACTA shall remain in-force following its ratification.

Article 2: Parties may implement measures that are more powerful than those required by ACTA, provided that such measures do not contravene any of its provisions. Each Party retains the right to determine the appropriate method of both the implementation and enforcement of the provisions.

Article 3: The measures in the Agreement apply only to intellectual property rights protected by law in the country in which the Agreement is operating.

Article 4: Parties have a qualified obligation to disclose private information under the Agreement. Those Parties receiving information under the Agreement must refrain from using such information for a purpose other than that for which it was provided.

Section 2: General Definitions

Article 5: 'Competent authorities' include judicial, administrative and law enforcement authorities. Right holders include associations with legal standing to assert rights in intellectual property.

Chapter II: Legal Framework for Enforcement of Intellectual Property Rights

Section 1: General Obligations

Article 6: Each Party must implement sufficient enforcement procedures in law that "take into account the need for proportionality between the seriousness of the infringement, the interests of third parties, and the applicable measures, remedies and penalties", provided that these are not "unnecessarily complicated or costly".

Section 2: Civil Enforcement

Article 7: Civil judicial procedures are to be made available to rights holders for the purpose of the enforcement of intellectual property rights.

Article 8: Parties must ensure that civil judicial authorities have sufficient power to order a party to desist from infringing intellectual property, and to grant an injunction against that party or any third party to prevent infringing goods (including those in a digital form) from entering the marketplace.

Article 9: Civil courts will be granted the power to order a party found guilty of infringement to compensate the rights holder, considering any legitimate measure of value the rights holder submits, including lost profits, the value of the infringed goods or services measured by the market price, or the suggested retail price. A party found guilty of infringement may be ordered to pay the rights holder any profit attributable to the infringement. Each Party must provide a system providing for one or more of the following: pre-established damages; or additional damages; or presumptions for determining the amount of damages sufficient to compensate the right holder. The presumption may calculate the monetary loss caused by the infringement as:

[Number of infringing goods transferred to third persons] x [Profit, per unit of goods, that would have been made by the right holder had there been no infringement]

Article 10: Civil judicial authorities are to be empowered to order the destruction of infringing goods, and of materials and implements predominantly used for the purpose of creating those goods, at the infringer's expense.

Article 11: Upon a justified request of the right holder, civil judicial authorities may order the infringer (or alleged infringer) to provide any information in their possession relevant to the investigation. This may include information regarding other persons involved in the infringement or alleged infringement.

Article 12: Parties must provide civil courts with the authority to order an injunction to prevent allegedly infringing goods from entering the marketplace, and to preserve evidence relevant to the alleged infringement. These orders may be made inaudita altera parte (without having heard the other side), and without delay. In attaining such injunctions, right holders may be required to provide any reasonably available evidence to demonstrate their intellectual property rights are being infringed, or such infringement is imminent. Where such injunctions lapse, or are revoked, the civil court may order the right holder to provide the defendant appropriate compensation for any injury caused by the measures.

Section 3: Border measures

Article 13: Effective border enforcement of intellectual property rights should not discriminate, without justification, between different intellectual property rights, and should be in a manner that does not create barriers to legitimate trade. Border measures detailed in Article 16.

Article 14: Small consignments of commercial goods shall be included in the application of Section 3, but small quantities of goods of a non-commercial nature contained within travellers’ personal luggage may be excluded.

Article 15: Parties shall permit authorities to request relevant information to be supplied by a right holder in order to assist them in taking the border measures referred to in Article 16.

Article 16: Parties shall adopt procedures with regards to import/export shipments, and in-transit goods, under which customs authorities are allowed to act upon their own initiative to prevent the release of goods suspected of infringing intellectual property rights and, where appropriate, to act in the same manner upon the request of a right holder.

Article 17: In complying with requests by a right holder as described in Article 16, authorities must require the right holder to provide adequate evidence to show there is an apparent infringement of the right holder’s intellectual property right. They will also be required to provide the authorities with sufficient information to identify the goods allegedly infringing intellectual property rights.

Article 18: Authorities must have the authority to require a right holder, requesting the procedures in Article 16, to provide a reasonable security (such as a bond to indemnify the defendant against any harm or loss arising from an incorrect accusation) in order to prevent abuse. In exceptional circumstances, a judicial order or Party may permit a defendant to obtain possession of suspect goods by providing a security.

Article 19: Parties shall adopt or maintain procedures by which, within a reasonable period of time, a determination can be made as to whether the suspect goods infringe an intellectual property right.

Article 20: Following a determination as described in Article 19, authorities will have the power to order the destruction of infringing goods. The simple removal of unlawful trademarks will not normally be sufficient to permit the goods to be released into the market. Administrative penalties may also be enforced against a defendant found guilty of infringing intellectual property rights.

Article 21: Any fees charged in relation to the procedures described in Articles 15-19 shall not be used to unreasonably deter a right holder's use of the process.

Article 22: Authorities may be authorised by a Party to provide a right holder with information about specific shipments of goods (for example, the description and quantity of the goods, and the names and addresses of parties involved in the manufacture and shipment of the goods) necessary to assist in the detection of infringing goods. Similarly, Parties may authorise the release of such information to the right holder within thirty days of seizure or determination.

Section 4: Criminal Enforcement

Article 23: Parties will provide criminal sanctions to be applied at least in cases of deliberate trademark counterfeiting or copyright or related rights piracy carried out as commercial activities for direct or indirect economic or commercial gain. Criminal sanctions will also be applied in cases of deliberate importation and domestic use in the course of trade and on a commercial scale of labelling and packaging that unlawfully infringes another's intellectual property right. Criminal sanctions may also be provided by Parties in cases of unauthorised recording of films shown in public cinemas, as well as liability for legal persons (entities with legal rights, such as limited companies) and those who assist in the planning or carrying-out of the offences listed above.

Article 24: Penalties for offences listed within Article 23 shall include imprisonment as well as fines that are of sufficient severity as to deter future acts of infringement.

Article 25: Parties shall empower competent authorities to seize suspected counterfeit goods, or pirated copyright goods, related materials and implements used to carry out the alleged offence, any documentary evidence relating to the alleged offence, and any assets derived from or obtained through the alleged infringement of the rights of an intellectual property right holder. Any prerequisite for the identification of items to be seized in order to issue an order shall not require detail greater than is necessary to identify them for the purpose of seizure. Parties must empower its courts to order the destruction or forfeiture of infringing goods and implements predominantly used for the infringement, without compensation to the infringer and in a way that operates outside the channels of commerce. Assets of equal value to those derived from infringement may alternatively be seized or forfeited.

Article 26: Each Party shall provide that, where appropriate, its competent authorities may act upon their own initiative to investigate suspected offences as described in Article 23, and to commence legal action if necessary.

Section 5: Enforcement of Intellectual Property Rights in the Digital Environment

Article 27:

1. Enforcement procedures as described in Sections 2 and 4 (above) must be available under law to permit action against an infringement of intellectual property rights taking place in the digital environment and across digital networks, including the unlawful means of widespread distribution for infringing purposes (digital piracy). These measures are to be implemented in a manner avoiding the creation of barriers to legitimate activity, and preserving fundamental principles of freedom of expression, fair process, and privacy - for example, by limiting the liability of Online Service Providers (OSPs) for the actions of their customers.
2. Parties may provide their competent authorities with the authority to order OSPs to disclose to a right holder information sufficient to identify subscribers accused of infringement, where that right holder has filed a 'legally sufficient' claim of rights infringement and such information is necessary for the purpose of protecting or enforcing those rights.
3. Legal remedies shall be provided by Parties against the circumvention of digital rights measures (DRM) designed to prevent or restrict unauthorised acts in respect of digital works, performances or phonograms. This includes the marketing of devices or products, including computer programs and services, as a means of circumventing any form of DRM.
4. Legal protection and remedies shall be provided against any person who, acting without authority, removes or alters any electronic rights management information (including but not limited to information identifying the work, the performance, and the author or performer of the work) or makes available copies of works, performances or phonograms knowing that such electronic rights management information has been removed or altered.

Chapter III: Enforcement Practices

Article 28: Parties shall encourage expertise in the enforcement of intellectual property rights within their competent authorities, promote the collection and analysis of statistics concerning intellectual property right infringement, and conduct research on the best practices to prevent and combat infringement. Mechanisms such as advisory groups should be promoted to facilitate Parties' competent authorities receiving the views of right holders.

Article 29: To identify and address significant risks, Parties may share information with each-other, and consult with right holders and the competent authorities of other Parties responsible for the enforcement of intellectual property rights.

Article 30: Each Party must take appropriate measures ensure transparency, through making public information on its procedures and authorities for enforcing intellectual property rights, and all relevant laws, regulations and judicial decisions related to the protection of intellectual property rights.

Article 31: All should promote measures enhancing public awareness of the importance of respecting intellectual property rights, and the potential harm of intellectual property rights infringement.

Article 32: The destruction of infringing goods (see Articles 10 and 20) shall be performed in compliance with each Party's laws and regulations related to environmental protection.

Chapter IV: International Cooperation

Article 33: Cooperation between Parties shall be promoted in the interests of preventing international infringement of intellectual property rights. Such cooperation may include law enforcement cooperation with respect to the criminal measures listed above, in Chapter II Section 4.

Article 34: Each Party shall, as far as is possible, exchange with other Parties the statistical data and information collected under Article 28, as well as information on its law and regulations related to the protection and enforcement of intellectual property rights. Other information may also be shared between Parties, as mutually agreed.

Article 35: Technical assistance shall, as far as is possible, be provided between Parties in relation to the enhancement of public awareness on intellectual property rights, training of officials, the development and implementation of national legislation related to the enforcement of intellectual property rights, and working closely to coordinate operations conducted at the regional and international levels.

Chapter V: Institutional Arrangements

Article 36:

1. Establishment of the ACTA Committee, in which each Party shall be represented. The Committee shall meet at least once each year, and all decisions must be made by consensus.
2. The role of the Committee is to review the implementation of the ACTA treaty, to consider any amendments in accordance with Article 42, decide upon the terms on which new Parties may enter the Agreement under Article 43, and consider other matters that may affect ACTA's operation. It is not to oversee or supervise the enforcement of the Agreement, nor the criminal investigations of specific intellectual property cases.
3. The Committee has the power to create sub-Committees to assist it in carrying out this role, and seek the advice of non-governmental persons and groups.
4. The ACTA Committee may make recommendations with regards to the implementation and operation of the Treaty with regards to its Parties, and may endorse best practice guidelines. Such information on best practice, and techniques for identifying and monitoring piracy and counterfeiting, may also be shared with third parties in order to reduce intellectual property rights infringements.

Article 37: Communications on any matter covered by ACTA shall be facilitated by a designated contact point for each Party, whose role will include the identification of appropriate office/officials to whom a requesting Party's enquiry may be addressed, and to act as an intermediary between the enquiring Party and the office/official concerned.

Article 38: Any Party may request private consultation, in writing with another Party, regarding any matter regarding the implementation of ACTA. The ACTA Committee may be notified of the result of these consultations, with mutual consent of the consulting Parties.

Chapter VI: Final Provisions

Article 39: ACTA remains open for signature until 1st May 2013 (See also Article 43). Participants in negotiation, and any other World Trade Organisation (WTO) members agreed to by consensus, may sign.

Article 40: ACTA shall enter into force 30 days after its ratification by at least six Signatories. For each Signatory that ratifies the Agreement following this date, the treaty shall enter into force 30 days after ratification.

Article 41: Withdrawal from ACTA takes effect 180 days after the delivery of written notification of withdrawal to the Depository (the Government of Japan, see Article 45).

Article 42: Any Party may propose amendments to the ACTA Committee, who will decide whether to present such amendments to the Parties for unanimous ratification. Any ratified amendment shall enter into force 90 days following the ratification of all the parties.

Article 43: Following the deadline of 1st May 2013 for accepting new Signatories to the treaty, any member of the WTO may apply to join. The terms of acceptance will be decided upon by the ACTA Committee, and the Treaty shall enter into force for that new member 30 days after their compliance with the terms.

Article 44: ACTA shall be signed in three, equally authentic originals, in the English, French, and Spanish languages respectively.

Article 45: The Government of Japan is the Depository of ACTA.

Take Action

• Sign the HM Government ePetition to "Say NO to ACTA"

See also

• ORG on ACTA
• ACTA: Facts, misconceptions and questions - ZDNet UK