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Negotiations held in Wellington on Anti-Counterfeiting Trade Agreement (ACTA), text released on 22 April 2010

23 April 2010

The text of the controversial draft ACTA has now been made public for the first time.  We briefly summarise its import.

Between 12 and 16 April 2010, negotiators from Australia, Canada, the European Union (represented by the European Commission), the EU Presidency (Spain) and EU Member States, Japan, Korea, Mexico, Morocco, New Zealand, Singapore, Switzerland and the US met in Wellington to further advance a draft of the ACTA.  That Agreement has been widely understood to be more muscular version of the WTO Trade-Related Aspects of Intellectual Property Rights Agreement (TRIPs) which does not seek to liberalise trade by removing barriers (as might be expected of a WTO agreement), but by enshrining minimum standards of intellectual property protection.  ACTA opponents are concerned that the ACTA will restrict free speech, particularly in the context of modern technology platforms and the internet.  The debate has not been assisted by the lack of transparency surrounding the negotiations to date. 

The veil of secrecy has been lifted by the release of the draft ACTA text on the morning of 22 April 2010 (NZ time).  The draft text provides that State Parties will ensure that their laws contain certain common baseline protections in the areas of civil and criminal enforcement and border protection.  It is notable for the level of detail it specifies in harmonising these areas of regulation, which goes beyond that contained in the TRIPs Agreement.  Some key features are summarised below.

Civil enforcement

  • Injunctions are to be available to prohibit infringing goods from entering “the channels of commerce”, and to prevent “infringing intermediaries” from assisting in infringement of intellectual property (at first glance, this could include internet providers).

  • Damages must adequately compensate the right holder for any injury suffered as a consequence of the breach, including legal costs (although for certain works it is permitted to establish a system of pre-estimated damages – i.e. a schedule of civil ‘fines’).

  • In some cases damages will be calculated by reference to the profits earned by an infringer.

  • Courts are to have the authority to order the forfeit of pirated goods and things used in their manufacture without compensation of any sort and at the expense of the infringer.

Criminal enforcement

  • Each signatory shall provide for criminal offences and penalties at least in cases of wilful counterfeiting or copyright piracy on a commercial scale, these penalties to include imprisonment, seizure and destruction of the goods in question.

  • These offences will apply to the primary offender, as well as to anyone who is a party to that offence (for instance by inciting, aiding or abetting it).  This may also potentially extend to internet service providers.

  • Enforcement authorities must have discretion to initiate investigations on their own initiative – i.e. in the absence of any complaint.

Border measures

  • Border authorities are to have the power to suspend release of suspect goods, either on application by a rights holder or on their own initiative; this section of the ACTA contains drafting intended to balance competing interests and combat abuse of the system: for example, a right holder alleging infringement may be required to put up security in case the rights holder is wrong.

Of course, this is a draft only, and many of the proposals outlined above remain square-bracketed, indicating that international debate is far from over.  The next round of negotiations takes place in Switzerland in June 2010.  Negotiators hope to conclude negotiations by the end of the year.

Parties wishing to better understand the implications of, or to make submissions to the New Zealand negotiators on, the ACTA text can contact Daniel Kalderimis at Chapman Tripp in Wellington or Matt Sumpter at Chapman Tripp in Auckland.