ACTA endangers innovation and fundamental rights

Today the FFII sent an open letter to The President of the European Parliament. See below or the pdf. See also our press release and the French translation: ACTA menace innovation et droits fondamentaux.


ACTA endangers innovation and fundamental rights

Open letter to The President of the European Parliament

28 June 2012

Dear Mr Schulz,

On 6 July 2005, the European Parliament almost unanimously rejected the software patents directive. The monopolisation of software ideas was a too serious threat to small and medium sized enterprises and innovation. The wisdom of the Parliament’s decision is clearly seen today, with patent wars raging in the mobile phone markets. The FFII was intimately involved in the discussions on the software patents directive.

Today, we are writing to express our concerns with the Anti-Counterfeiting Trade Agreement (ACTA). We believe the Parliament should reject ACTA.

ACTA contains heightened civil enforcement and intrusive criminal measures. It lacks an analysis of extra-territorial privatised enforcement, this endangers European companies and citizens.

Many US Internet companies operate on a global scale and apply US law extra-territorially, on EU companies and citizens. This is a disturbing trend. ACTA adds an obligation on the US to stimulate cooperative efforts within the globally operating US business community. The US – and other ACTA parties – can use this to harm EU competition and citizens. The business community is not interested in guaranteeing fair competition or fundamental rights. Extraterritorial criminal measures are also a grave concern.

Because of the complexity of intellectual property rights legislation, innovative businesses are often forced to operate in a legal “grey zone”. This will make EU companies and their customers vulnerable to foreign extraterritorial measures. The European Convention on Human Rights and the EU Charter of Fundamental Rights do not protect EU companies and citizens against foreign extraterritorial measures.

The Internet is a key enabler of innovation and fundamental rights. ACTA’s civil measures will have a chilling effect on innovative companies. ACTA introduces damages based on retail price, they may turn out extremely high. ACTA contains intrusive injunctions and provisional measures, including against third parties, like software suppliers. Companies must become more risk-averse, even when the activity they are engaged in may ultimately be legal. Further pressure on companies and citizens comes from ACTA’s criminal measures against everyday computer use, including against “aiding” and “abetting”.

ACTA will have anti-competitive effects stretching beyond the markets it seeks to regulate. It will create an environment where large competitors will have major advantages over smaller firms and start-ups, even extra-territorially. ACTA will have a chilling effect on innovation, start up companies, Internet service providers and mass digitization projects.

ACTA will foreclose future legislative improvements in response to changes in technology or policy. The Union should retain much needed policy space.

Since the ACTA partners already have a high level of protection of intellectual property rights, a 2011 study commissioned by the European Parliament International Trade committee concludes, that there does not appear to be any immediate benefit from ACTA for EU citizens.

Emerging economies like China, Brazil and India will not sign ACTA, as ACTA endangers their development and access to medicine and knowledge. Germany’s Federal Ministry for Economic Cooperation and Development advises developing countries against signing ACTA. As they are emerging economies, the Germany ministry should also have advised Eastern European countries not to sign ACTA.

Five European Parliament committees advise the plenary to withhold consent to ACTA. The Parliament would seriously compromise its credibility should it vote in favour of ACTA. The Commission would like the Parliament to wait for the European Court of Justice’s opinion on ACTA and fundamental rights. This would be a wrong approach. The Court’s test is a marginal one on fundamental rights. The Parliament’s committees also looked at broader issues, like innovation and access to medicine. The Parliament has to take a political decision.

Some suggest to ask guarantees from the Commission to ensure legal clarity. Such guarantees can only be empty. They are not binding on the Commission nor on companies, here and outside Europe. Furthermore, ACTA’s interpretation may ultimately depend on external dispute resolution panels. ACTA does not bring solutions, nor benefits, but only unacceptable risks. The Parliament has to take a stand and reject ACTA.

Yours sincerely,

Ante Wessels

Foundation for a Free Information Infrastructure (FFII)

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