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Glyn Moody's look at all levels of the enterprise open source stack. The blog will look at the organisations that are embracing open source, old and new alike (start-ups welcome), and the communities of users and developers that have formed around them (or not, as the case may be).

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ACTA Update XVI

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On Monday I posted my talk "Before and After SOPA". In it, there's a reference to "country club" treaties (slide 17) that may have intrigued some people. It's a term I came across recently, and I think provides us with a useful way of thinking about ACTA (and TPP).

I found it in Volume 3 issue 1 of the WIPO journal [.pdf], in an article entitled "ACTA and Its Complex Politics" by Peter Yu:

At the global level, the major criticisms of ACTA concern the limitation of its membership to developed and like-minded countries, the lack of representation by countries in the developing world and the agreement’s potential negative impact on the international intellectual property regime. To highlight the problematic nature of ACTA, some commentators, such as Daniel Gervais, have described the agreement as a “country club agreement”.

Within this country club, members set rules to govern its membership. Article 36 [of ACTA] provides details on the ACTA Committee, which is charged with the agreement’s administration and management and is granted broad powers to establish ad hoc committees. Article 42 delineates the procedure for amending the agreement. Article 43 further specifies the time the agreement will be open for signature and how countries can accede to it after the expiration of the specified period.

I think that encapsulates rather well some of the key problems with ACTA: the fact that it was negotiated in secret, amongst a small group of nations and their lobbyist chums, but excluding hoi polloi like the BRICS countries, who might lower the tone of the proceedings by asking for more balanced terms.

The secrecy of those negotiations undermines any claim to legitimacy - there was no real opportunity for the public, the people most affected by ACTA, to provide any input into the proceedings, or to be able to comment on proposals. Meanwhile the "exclusivity" of the country club gathering ironically makes it highly unlikely that the nations whose support is most needed - China, India and Brazil - will join up later, for reasons that Yu explains:

In contrast to Canada and Italy, major developing countries, such as Brazil, China and India, were excluded from the very beginning of the negotiations, even though Japan emphasised early on that “the intent of the agreement is to address the IPR [intellectual property right] problems of third-nations such as China, Russia and Brazil, not to negotiate the different interests of like-minded countries”. From the standpoint of intellectual property protection, there is no doubt that these emerging countries are important to the successful operation of the international enforcement regime.

Consider China for example. The country’s piracy and counterfeiting problems have provided a major impetus for the development of new international intellectual property enforcement norms. China was also involved in a recent WTO dispute with the United States over the protection and enforcement of intellectual property rights. Given the negotiating parties’ conscious and determined choice to exclude China from the negotiations, it is unclear how they can now entice China to join this new exclusive club.

Once people realised that ACTA was fatally flawed because of the absence of the BRICS countries - particular China - its supporters have desperately tried to use the fact that China joined the WTO later as evidence that it will do the same with ACTA. Yu explains the background:

In the 1990s and early 2000s, China was very eager to join this club and accede to the TRIPS Agreement even though it had to revamp a large array of laws and regulations and agree to high WTO-plus standards. As Samuel Kim observed at that time, China was willing “to gain WTO entry at almost any price”. The country’s approach was understandable. To many Chinese, the WTO membership helped secure China’s rightful place in the international community. Even if the economic costs were high, the symbolic value of the WTO accession and an improved standing in the international community would more than compensate for the short-term costs.

By contrast, joining ACTA would give China nothing in terms of prestige - the situation is really completely different now. China finds itself in a far stronger position than it did when it decided to join the WTO, and is accorded far more respect, not least from the West that needs China's huge financial reserves to keep its debt-ridden economies afloat:

ACTA, however, is not the WTO. It does not give China a rightful place in the international community. Nor does the club membership seem to have any bearing on China’s dignitary interests. While it could be unattractive for China to be branded as a pirating nation, ACTA is not limited to countries that have always respected intellectual property rights. The chequered pasts of Japan and the United States, the two major proponents of this agreement, speak for themselves. More importantly, at the time of the negotiations, Canada, South Korea and a few EU member states were on the United States Trade Representative’s Special 301 Watch List. Even under the standards set unilaterally by the United States, the ACTA country club is a den filled with known pirates.

The remark about the Special 301 Watch List is interesting. If you've not come across it before, it is a document produced annually by the US Trade Representative, and essentially is a wish-list of actions from the US copyright and pharmaceutical industries who want foreign countries to "fall into line" in various ways with US trade policies.

By a strange coincidence, all of those actions would be entirely to the benefit of those US industries, and would usually damage companies and their workers in any countries foolish enough to implement those wishes. In fact, the only reason countries comply with these demands is because the US finds ways to threaten them - by withdrawing economic or political support, for example.

Initially, the Special 301 Watch List had a certain force, since being placed on it could have negative trade consequences for the country concerned, especially if the US decided to get heavy. But recently, the industries providing input to the US Trade Representative have overplayed their hand, and started putting countries like Canada on it too - despite the fact that Canada's copyright laws are more than adequate when examined objectively. This has led Canada and others increasingly to dismiss the Special 301 list as little more than thinly-disguised US industry bullying aimed at undermining foreign rivals.

As Yu points out in his WIPO article, the US government's over-hasty branding of dozens of countries as pirate nations has inevitably devalued that concept to the point where China probably wouldn't be too worried by the appellation, which means that it would be unlikely to feel any great need to sign up to ACTA as a result.

Moreover, Yu suggests that China will not be alone in its indifference to joining the ACTA country club:

Like China, Brazil and India have shown no urgent desire to join ACTA. Nor have they found the club membership advantageous. As Anand Sharma, the Indian commerce and industry minister, emphatically declared: “If [the TRIPS Agreement] has to be revisited in any stage in future, it will be only in multilateral forum—the WTO, it cannot be done outside”. Likewise, Brazilian officials refused to “recognize the legitimacy of the treaty”.

The reactions of Brazil, China and India are indeed no surprise. In today’s age, these increasingly powerful developing countries are unlikely to buy into a system they did not help to shape. With their now considerable increase in economic power and geopolitical leverage, those days where a system could be created in developed countries and then shoved down their throats are long gone. If “enhanced international cooperation and more effective international enforcement” are some of ACTA’s key goals, as stated in the preamble, it is simply ill-advised to ignore these crucial partners in the negotiations. It is also short-sighted to consider countries unclubable by virtue of their lack of like-mindedness.

And that, in a nutshell, is why the country club approach is likely to backfire. By excluding key nations like China, India and Brazil during negotiations, the ACTA signatories have very publicly treated them like second-class citizens. That's really not a good strategy when you hope to win them over in the future. What it means in practice is that the suggestion that ACTA may not do much now but will be effective once China et al. start lining up to join, is revealed as little more than a desperate last-gasp attempt to salvage the unsalvageable.

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