April 21, 2010 | By Gwen Hinze

Shaping IP Laws by Not-So-Gentle Persuasion: The Special 301 Report

At the end of this month the United States Trade Representative's Office will release its annual Special 301 report, a review of global intellectual property protection and enforcement standards conducted by the Office of the United States Trade Representative (USTR). Since 1989, the USTR has used the Special 301 Report to intimidate other countries into adopting more stringent copyright and patent laws by singling out particular countries for their "bad" intellectual property policies, naming them on a tiered set of "watch lists," resulting in heightened political pressure and in some cases, the potential for trade sanctions, to encourage changes to their laws.

In previous years, the USTR has relied heavily on submissions from the entertainment and pharmaceutical industries to compile the rankings for the Special 301 report. This has resulted in particularly unbalanced assessment criteria. Countries have been listed for proposing exceptions to their national copyright laws, for failing to sign on to controversial international treaties, and for not mirroring specific parts of US law in their national laws. In other words, countries have been listed for failing to adopt the enforcement norms from U.S. copyright law, but also for attempting to create the same type of balancing exceptions and limitations to copyright holders' exclusive rights that have allowed user generated content and technological innovation to flourish in the U.S.

In 2006, the IIPA recommended that Chile be placed on the Special 301 Priority Watch List (a tier above the "Watch List" ranking) for considering fair-use style exceptions to copyright in Chile's copyright law:

During 2005, several Chilean government agencies reportedly were trying to amend the bill to incorporate very broad "fair use-like" exceptions which would allow copyrighted materials to be used without the rights-holders' authorizations. It is likely that these provisions, if included, would also meet with the objections of the copyright industries.

In 2009, Israel was placed on the Priority Watch List for refusing to adopt DMCA-style laws prohibiting the circumvention of copyright owners' technological protection measures (TPMs) after intense parliamentary debate and doubts about whether DMCA-style anticircumvention provisions actually do anything to stop copyright infringement. This is an astute question, given that in the US, those provisions have caused considerable collateral harm to lawful users of copyrighted works while having no appreciable effect at stopping, or even slowing, digital copyright infringement. Again, this is not a matter of compliance with international law as it is frequently portrayed to be. Israel has chosen not to ratify the controversial 1996 WIPO Copyright Treaty and WIPO Performances and Phonograms Treaty, and so is not required to adopt legal protection for copyright owners' technological protection measures.

In 2006, Canada was subjected to an Out of Cycle Review (because the USTR thought the country merited special attention outside the normal Special 301 schedule) after it released draft copyright legislation implementing those treaties that included legal protection for TPMs, but not close enough to the DMCA to satisfy the US copyright owners in the IIPA. And Canada drew the ire of the USTR again in 2009, for requiring its customs officers to have a court order before seizing items at the border — something that ACTA looks like it will overturn.

As EFF noted in our joint submission with Public Knowledge, Special 301 neglects critical US foreign policy goals. The policies it advocates ignore the importance of the free flow of information for social and economic development, and the the need to support US technology exporters seeking new markets. We argued that the Special 301 process should account for the interests of all stakeholders in the knowledge economy -- not just IP rights-holders.

We also made a number of specific recommendations for addressing the procedural deficiencies in the Special 301 process, including that the USTR should make transparent the set of factors and standards it uses for evaluating countries in each year's Special 301 Report, and arrange for independent external verification of country data and statistics submitted by the IIPA before making factual determinations based upon it; and that the USTR should provide a meaningful opportunity for public interest advocates to file comments in response to submissions provided by copyright industry rights-holders.

The USTR opened up the Special 301 submission process this year to all interested stakeholders for the first time and received over 700 submissions. While we welcome this new approach by the Obama administration, the real test for sound policy-making will be whether the 2010 Special 301 Report takes account of the views of all stakeholders. We'll find out shortly.


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