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30 April 2004 Senate Select Committee on the Free Trade Agreement between Australia and the United States of AmericaThe Australian Library and Information Association (ALIA) is the national body for the Australian library and information sector, representing 5000 individual professionals, 900 library and information organisations and the interests of 10.7 million users of library and information services. On behalf of its members and library and information services users the Association thanks the Committee for the opportunity to comment on the effects of the Australia-United States Free Trade Agreement. Our submission follows the terms specified in term 2(a) and (c) the agreement and its impacts and 2(b) the democratic and transparent process reviewing the agreement in its totality. The agreement and its impacts [term of reference 2 (a) and (c)]Our submission on the Agreement and its impacts should be read in conjunction with the attached copy of our submission to the Joint Standing Committee on Treaties. Our submissions refer in particular to articles in chapter 17, Intellectual Property and the inclusion of cultural services in Annexes 1 and 2. In summary:
Copyright: owners advantaged at expense of information usersALIA opposes the extension of the copyright term and the adoption of the Digital Millennium Copyright Act (US) provisions which impede users from circumventing technological blocks to otherwise legal access to information. A fuller discussion in support of our position on these issues is contained in our submission to the Joint Standing Committee on Treaties, which we attach. However in relation to this Committee's specific terms of reference, we add the following comments. The FTA Chapter 17 provisions on intellectual property give advantage to copyright owners to the detriment of users of copyright information. They are carried directly from United States law, without the corresponding 'fair use' provisions which give American users of information greater access to copyright information than the more restrictive 'fair dealing' provisions in Australian law. The terms of the agreement advantage the large United States-based entertainment and publishing industries and disadvantage Australian users in comparison with American users. Australian users are further disadvantaged in that while the United States is protecting the interests of industries which are contributing significantly to its economy. Australia is (and will be for the foreseeable future) not only a net consumer of information and users therefore reliant on easy access and use, but also a country with a rural and regional population losing services and infrastructure on one hand and on the other hand, increasingly dependent, in the information economy of the 21st century, on digital communication of information and education to redress the disadvantage of isolation from metropolitan centres. It is not in Australia's interests to be supporting the treatment of digital information as different. The present Government recognised the importance of the principle of technological neutrality in the Digital Agenda amendments to the Copyright Act. Copyright law, both in national law and international agreements, is based on a balance of interests between owners and users, so that the creators' right to be rewarded is extensively protected for a limited time, after which the work is released into the public domain to stimulate further creativity and innovation. Every review of copyright in Australia takes account of how amendments to the law, proposed and actual, affect that balance between owners and users in the interests of all Australians. Six months ago, the Senate Environment, Communications, Information Technology and the Arts References Committee commented that it was: 'inclined to the view that the current balance between the rights of copyright owners and access to information by users in the digital environment is an acceptable one' [Libraries in the online environment para 4.4.1] The Digital Agenda Review report and recommendations, prepared by Phillips Fox, (submitted to Government in January and published on 28 April 2004) notes that: 'Overall, submissions to the review accept that, in general, the Digital Agenda is achieving its objectives and is working well. However, no interested party has submitted that all amendments have achieved an appropriate balance of rights and obligations or that there is no room for improvement or change.' [Final report p1] The corollary is that, overall, no interested party, including ALIA, criticised the overall balance of rights and obligations. However, both the Senate and the Digital Agenda Review reports, and ALIA submission and comments to the Digital Agenda Review, were prepared before the terms of the USAFTA were published. ALIA submits that the balance of rights and obligations will be inappropriate if the copyright term extension and the digital protection clauses of the USAFTA are enacted in Australia's Copyright Act without the extension of user access. Fair useALIA proposes either:
Section 107 of the US Copyright Act provides that copying for fair use for purposes such as criticism, comment, news reporting, teaching, scholarship or research is not an infringement of copyright. Factors to be considered in determining a fair use include:
An unpublished work, in perpetual copyright, is still accessible under fair use. Each 'fair use' is decided on its own merits. Copyright term extensionEven if the user access to information is broadened, the problem of copyright term extension remains with the permanent closing-off for an extra twenty years of information from further creation and innovation. Canada has consistently refused to extend duration of copyright beyond the Berne Convention requirement, despite a long record of bilateral trade agreements with the United States. ALIA continues to support rejection of term extension, outlined in its submission to the Joint Standing Committee on Treaties, and in the submission of Dr Matthew Rimmer of the Australian National University, himself an author and a member of ALIA's copyright and intellectual property policy advisory committee. Harmonisation and moral rightsAn argument for term extension is harmonisation with European and US standards. The moral rights of the creator are also standard in international law and in Australian law. They are separate from copyright in that they remain with the creator but they are part of the overall copyright regime in duration, and in international and Australian law. The United States has very poor moral rights coverage, largely limited to art works. In the interests of Australian creators and in the pursuit of harmonisation, why is a commitment from the United States on moral rights not included in this agreement? ALIA supports recognition of moral rights in any trade agreement involving intellectual property. ALIA urges the Committee not to support extension of the copyright term (Article 17.4.4); and not to adopt the technological protections measures and penalties in Chapter 17 without distinguishing between private copying, caching for educational purposes and those activities already prohibited in Australian law as criminal, that is, the breaching of owner's rights undertaken for fraudulent commercial gain. Cultural industriesALIA urges the Committee to recommend retention of the Australian Government's powers to encourage Australian cultural industries by legislation and subsidy in any way appropriate for the public interest now or in the future. ALIA supports the arguments of the Australian Coalition for Cultural Diversity on this matter, particularly in not limiting the powers of future Australian governments to regulate local content in new media. ALIA believes that the Australian Government should follow the example of Canada, a veteran of trade agreements with the United States, in not acceding to provisions which impair its right to legislate on intellectual property and culture for the primary interests of its citizens. The democratic and transparent process reviewing the agreement in its totality [Term of reference 2(b)]ALIA identifies serious concerns with the process of reviewing the agreement in its totality, all of which are related to the haste in which the FTA process has occurred and is occurring. Informed public discussion is limited by the haste in which the FTA is proceeding. The only public discussions of the Agreement are taking place in the media, and the limited periods permitted by the time constraints of the two Parliamentary Committees. Recent reviews and reports which deal with proposed changes to Australian copyright law have been quarantined from the FTA process. The Phillips Fox report on the Digital Agenda Amendments Review was released this week on 28 April. All of its consultation took place in parallel with discussions on FTA intellectual property concerns conducted by the Department of Foreign Affairs and Trade, but the two processes remained resolutely separate. The Phillips Fox report is thorough and thoughtful and shows the benefits of their consultative approach. They held meetings for special interest groups which were in general agreement and meetings where opposing groups representing copyright owners, users and creators participated. This useful process brought different views together and has contributed to the effectiveness of the report, even if ALIA doesn't necessarily agree with every recommendation. The DFAT consultation process with its very tight time and place constraints directed itself at hearing the views of likeminded interests, presumably to give the Australian negotiating team an overview of all interests involved in the negotiation. The Allen Consulting Report, published last year and commissioned by the Motion Picture Association of America, the supporters of a term extension, failed to provide any evidence for it. Given this failure, and the testimony of Nobel prize-winning economist, Milton Friedman before the United States Supreme Court in Eldred v. Ashcroft that it was unlikely that the economic benefits of extension outweighed the additional costs, it is surprising that the Australian Government has not commissioned a comprehensive study of the social and economic effects of agreeing to such an extension. The economist, Henry Ergas, was disappointed that the Federal Government did not engage in any economic research into the copyright term extension: '...the FTA obliges Australia to increase the term of copyright protection by 20 years, in line with the US regime...This change is a gift to IP producers since it comes with the broader usage rights that US consumers enjoy because of the more generous manner in which non-infringing uses of IP products (eg copying for research purposes) is interpreted. The Independent Committee of Inquiry into Competition Policy in Australia (the Hilmer Report) recommended that Australian governments should not place regulatory restrictions on competition unless clearly demonstrated to be in the public interest. The FTA was not but should be subject to this process. Two reports of the Copyright Law Review Committee are also material to copyright issues in the FTA, namely the report on Simplification of the Copyright Act which discussed fair use and fair dealing and the report on Copyright and contract, which recommended that licence conditions not over-ride otherwise legal access to information. The Government's position changeThe Minister for Trade, Hon Mark Vaile acknowledged on 8 December 2003 (Australian Financial Review) that the copyright term extension was one of the 'standout issues' where Australia and the US remained at odds in the intellectual property negotiations and that Australia was 'pushing back' at this stage. The Minister stated that 'It is a very important issue, particularly in terms of cost to libraries, educational institutions and the like here in Australia'. 'There is a whole constituency out there with a strong view against copyright term extension and we are arguing that case'. Further discussion on this topic was pre-empted by the sudden announcement of the Agreement. Further, in its release of the Phillips Fox review report the Government advises that the copyright obligations of the Agreement supersede the recommendations of the review report. The Centre for International Economics report [178 pages] on the AgreementThis report was published in totality today, [30 April] too late for any useful critical analysis into either the negotiations or submissions to either of the Parliamentary committee reviews. There was no public consultation involved in this process of analysing the costs and benefits to the Australian community and the process appears to be an economic modelling exercise which will not be sufficient to gauge the impact of Chapter 17 on Australian information users. ALIA believes that the Parliament and the Australian public need more time to test the overall social and economic costs and benefits of the FTA, and that the suggestions of the Phillips Fox report regarding resourcing empirical analysis in copyright matters should be considered, before enacting the FTA chapter 17 provisions. Yours sincerely
Jennefer Nicholson Appendix AALIA submission to Joint Standing Committee on Treaties
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