TPM & TPP: The constitutional nexus

The US trade representative's (USTR) IP chapter for the Trans-pacific Partnership Agreement (TPP) suggests significant changes to the regulation of technological protection measures (TPMs). These changes extend the scope for causes of action and specifically limit exceptions to the circumvention of TPMs.

According to a leaked document the USTR has proposed the following exceptions:

• Reverse engineering for interoperability
• Research into flaws and vunerabilities in encryption
• Inclusion of a component to prevent access to inappropriate content by minors
• Security analysis and testing
• The removal of private data gathering components - so long as their removal does not then allow access to the work
• Law enforcement
• Access by public libraries for the sole purpose of acquisition decisions

There is a further exception allowed for when a a legal or administrative decision deems that the effect of the TPM makes the non-infringing use no longer available - but that exception can only be existent for 3 years.

So, the total exceptions are extremely narrow, even taking away some of the narrow exceptions existent in the Australian Copyright Act such as region encoding in s10(1)(c). Outside of these exceptions the TPP prescribes a "separate cause of action, independent of any infringement..." (emphasis mine). So the circumvention of a TPM becomes a cause of action per se.

This significantly changes the landscape of copyright. Making a modification to your own property, regardless of whether it infringes copyright, can now be a cause of action. Ultimately this breaks the nexus between a TPM being a copyright-related device to being a device that limits rights to chattels. This breaks the nexus between the TPM provision and the constitutional head of power that enables the Commonwealth to legislate with regard to copyright, section 51 (xviii).

In the 2005 Stevens v Sony case, at [218] Kirby, J comments:

"To the extent that attempts are made to push the provisions of Australian copyright legislation beyond the legitimate purposes traditional to copyright protection at law, the Parliament risks losing its nexus to the constitutional source of power."

This is not to say that the imposition of the TPP would necessarily be unconstitutional as the Commonwealth has other heads of power upon which it could rely, such as the external affairs power in s51(xxix). However, it is of concern that external treaties such as the TPP should be used to enable the Commonwealth to legislate for the regulation of the use of an individual's private property.

Needless to say, the invasion of copyright into the realm of the regulation of chattels represents a significant intrusion by the international treaties system into citizen's ordinary enjoyment of their private property. It significantly re-balances the rights inherent in intellectual and real property and has the potential to fundamentally change the rights that one has over their own property.

TPP turning ISPs into copyright police

The 6th round of negotiations for the so-called Trans-Pacific Partnership (TPP) are set to occur from 28th March 2011 - and if we were to rely on DFAT's website the TPP treaty is merely to:

"develop a high-quality, comprehensive 21st century Free Trade Agreement (FTA) that increases economic integration in the Asia-Pacific region, particularly as membership expands over time."

This all sounds very reasonable but what it doesn't mention is that, amongst other things, the TPP has a significant section devoted to copyright.

The US Trade Representative to the treaty negotiations has put forward a number of proposals which would "harmonise IPR provisions strictly upwards", these include:

• Banning parallel imports
• Increasing the term of copyright
• Criminalising Digital Rights Managment (DRM) circumvention - even when there is no copyright infringement
• Imposing ISP liability for the infringement of their users, including providing incentives for ISPs to become copyright cops for the content industry
• Requiring ISPs to identify users at the behest of the content industry
• Expanding the scope of what is patentable and limit objections to patents

This, of course, reads like a wish-list of the content industry and it would probably not surprise anyone to know that there is an extremely close relationship between the content industry and the US government.

Furthermore, the TPP contains provisions for "dispute resolutions" which means that countries that are not compliant with the increased scope of the IP provisions can be fined.

So what does this mean for Australia?

Firstly, the TPP IP provisions exceed those in the AUSFTA and even further than the completed-but-not-in-force ACTA treaty, especially the "exceptions" provisions for DRM and the expanded scope for patentable material.

Secondly, it will impose a regime of ISP copyright enforcement that goes much further than the suggested model put forward by Emmet, J in the AFACT v iiNet case. The Internet Industry Association (IIA) has already stated that it is prepared to draft a code to address the uncertainty regarding the steps that ISPs should take in responding to allegations of copyright infringement by their users. However, the imposition of the TPP will make this attempt at industry self-regulation redundant by substituting an industry negotiated code, which will likely contain at least some consumer protections, to a legislative regime which does not. Furthermore, a country is prevented from implementing more consumer friendly provisions by the "dispute resolution" clauses that may result in the country being fined.

So there is a real danger that the TPP will further tip the balance in favour of big content and away from consumers, but then this seems to be the modus operandi  of these FTAs and is hardly surprising. The irony is that the more big content punishes consumers and refuses to provide content in a way that their customers want, the more their customers will pirate their content using the ever-more sophisticated tools available to find and download content and to hide their tracks while doing so - making a legislative regime ineffective.

As IIA president Peter Coroneous said recently:

"Market failure remains a core contributor to the infringement problem. If users have access to more and better content, when, where and in the form they choose to consume it, and at a realistic price, we're quite confident the motivation for infringement will decline. We certainly don't condone the infringement of copyright - but internet users need attractive, lawful alternatives if we are to see positive behavioural change. There's no reason why Australia shouldn't be leading the way here."

And maybe that is the area in which Australia can lead the way, rather than continuing to implement an ever-more draconian legislative regime under the guise of "free trade".