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The TPP is getting closer -- what does it mean for the tech sector?

Averill Dickson | July 29, 2015
Despite the apparent nearness of the Trans Pacific Partnership Agreement, the contents are still largely cloaked in secrecy, with no official drafts available.

Similarly, the European Union directive on the legal protection of computer programs allows decompilation for the purpose of achieving interoperability, and prohibits contracting out of this right.

By contrast, while the US Digital Millennium Copyright Act (DMCA) permits reverse-engineering, there is no prohibition on contracting out. US case law has held that, where an end-user license agreement specifically prohibits reverse-engineering, the contractual prohibition will override the copyright law which expressly permits it.

There are no express provisions in the October 2014 draft of the TPP IP chapter dealing with reverse-engineering. Any reverse-engineering exceptions in national law will therefore need to comply with the general principle, set out in the IP chapter, that exceptions to copyright must be confined so as to not conflict with normal exploitation of the work in question, and to not unreasonably prejudice the legitimate rights of the rights holder.

Due to the differences in approach between New Zealand and the USA in relation to contracting out, there is therefore a risk that a rights holder could challenge the approach taken in New Zealand's Copyright Act, on the basis that the prohibition on contracting out unreasonably prejudices the rights holder's legitimate rights.

ISP liability

There appears to be a significant level of controversy between negotiating countries regarding the proposed provisions relating to internet service provider liability for infringing material. The October 2014 TPP IP chapter requires countries to provide internet service providers with incentives to take down content following allegations of copyright infringement, along the lines of the notice and takedown provision of the DMCA. DMCA-style notice and takedown systems have been criticised as stifling innovation, access to knowledge and free speech, as well as imposing expensive and onerous obligations on companies to oversee users' activities and process takedown notices.

The ISP liability provisions in the October 2014 draft of the TPP IP chapter are heavily annotated, with many opposing positions from different countries, so where this section will end up will be interesting to watch.

Temporary electronic copies

The US does appear to have backed down from its original position that the TPP copyright rules should apply to both permanent and temporary electronic copies of works, such as the copies of software that are temporarily loaded into a computer's memory in order to use the software. The October 2014 TPP IP chapter now includes a footnote (that appears to be unopposed) stating that the term "copy" refers only to "fixed copies that can be put into circulation as tangible objects".

Where to next?

Even after 12 years of negotiation, the October 2014 draft of the TPP IP chapter demonstrates that there are a number of contentious issues still to be resolved. Other reported areas of controversy include agricultural subsidies, access to medicines, currency manipulation, workers' rights and the proposed investor-state dispute settlement system (which would give private investors and businesses the right to initiate dispute settlement proceedings against foreign governments in their own right).


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