Recent Stories

Broken data protection in EU trade agreements

The study “Trade and Privacy: Complicated Bedfellows? How to achieve data protection-proof free trade agreements” is remarkable. On the one hand it shows, beyond doubt, that the EU fails to sufficiently protect personal data in its trade agreements. On the other hand, one of the safeguards it recommends could leave our personal data more vulnerable. Monique Goyens, Director General of The European Consumer Organisation (BEUC), commented:

It’s unacceptable that the EU’s privacy and data protection rules could be challenged through trade policy.

European Commission publishes Privacy Shield

The European Commission has published its Privacy Shield decision together with a Communication. The Privacy Shield will govern the transatlantic commercial flow of personal data from Europe. The European Commission follows up of its previous Safe Harbour decision that was turned down by the European Court of Justice in its Schrems decision. The core of Privacy Shield is hidden in provision 61:

(61) In the light of the information in this section, the Commission considers that the Principles issued by the U.S. Department of Commerce as such ensure a level of protection of personal data that is essentially equivalent to the one guaranteed by the substantive basic principles laid down in Directive 95/46/EC

Earlier published drafts of the document stated “as a whole”. Unpublished Commission drafts previously unlawfully obtained by Politico.eu and made available to their paid subscribers also contain the “as such” wording.

UPC and ISDS: who would have to pay the damages awards?

Investment lawyer Pratyush Nath Upreti argues that investors will be able to use investor-to-state dispute settlement (ISDS) to challenge decisions of the Unified Patent Court (UPC). [1] Investors could for instance use a Dutch bilateral investment treaty to challenge UPC decisions. Upreti identifies Dutch investment treaties as suitable for treaty shopping and warns for more frivolous IP litigation in investor-to-state dispute settlement. This raises a question. Who would bear the litigation costs and damages awards?

FFII comments on TTIP human rights assessment

ECORYS has published a draft human rights assessment (sustainability impact assessment) on the trade agreement being negotiated between the EU and the United States (TTIP). Today the Foundation for a Free Information Infrastructure (FFII) has sent an email to ECORYS noting issues regarding intellectual property rights, investor-to-state dispute settlement (ISDS / ICS), data protection, and openness. Footnotes per section, text continues after footnotes. Intellectual property rights

The word “ACTA” does not appear once in the draft report. ACTA analysis has shown that intellectual property rights enforcement may seriously threaten fundamental rights at various levels.

CETA: ISDS and data protection

This is the fourth in a series of blogs on the EU-Canada trade agreement (CETA) and data protection. In earlier blogs we saw that under the CETA text Canada can give our personal data related to financial services, transfered to Canada, a lower protection than under the standard set by the Court of Justice of the EU in the Safe Harbour ruling. This is relevant as Canada is a member of the “Five Eyes”, a group of countries committed to (suspicionless) mass surveillance. We also saw that CETA does not allow data protection measures based on a higher data protection standard than agreed in CETA. Textual shortcomings especially become clear in conflict situations.

CETA ISDS not conform European Parliament resolution

In February 2016 the European Commission and Canadian government published the final draft text of the EU – Canada trade agreement (CETA). This final draft includes an investment chapter with investor-to-state dispute settlement (ISDS). ISDS is one of the most controversial elements of proposed EU trade agreements as it gives foreign investors the right to challenge government decisions outside local courts. The ISDS section in CETA is based on the 12 November 2015 ISDS proposal for TTIP. According to Germany’s largest association of judges and public prosecutors (original in German) and the European association of judges the adjudicators would not be independent.

CETA will harm our privacy

This is the third in a series of blogs on the EU-Canada trade agreement (CETA) and data protection. (Prior blogs: CETA and mass surveillance, CETA places itself above EU Charter of Fundamental Rights)

In this blog I will show CETA provides less data projection than the EU Charter of fundamental rights. Under CETA article 13.15 the EU has to allow cross border data transfers to Canada; the related data protection standard is not compatible with the Court of Justice of the EU (CJEU) Safe Harbour ruling. Chapter 13 Financial Services, article 13.15 Transfer and processing of information, page 103, reads:

“1. Each Party shall permit a financial institution or a cross-border financial service supplier of the other Party to transfer information in electronic or other form, into and out of its territory, for data processing if processing is required in the ordinary course of business of the financial institution or the cross-border financial service supplier.

CETA places itself above EU Charter of Fundamental Rights

This is the second in a series of blogs on CETA and privacy. (blog one: CETA and mass surveillance)

The draft EU-Canada trade agreement CETA contains a general exception that is supposed to be a safeguard for policy space. However, this safeguard places CETA above the Charter of Fundamental Rights of the EU. CETA final draft Chapter 28 Exceptions, article 28.3 (2), page 212, reads:

“For the purposes of Chapters Nine (Cross-Border Trade in Services), Ten (Temporary Entry and Stay of Natural Persons for Business Purposes), Twelve (Domestic Regulations), Thirteen (Financial Services), Fourteen (International Maritime Transport Services), Fifteen (Telecommunications), Sixteen (Electronic Commerce), and Sections B (Establishment of investments) and C (Non- discriminatory treatment) of Chapter Eight (Investment), subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between the Parties where like conditions prevail, or a disguised restriction on trade in services, nothing in this Agreement shall be construed to prevent the adoption or enforcement by a Party of measures necessary:
(a) to protect public security or public morals or to maintain public order; 31
(b) to protect human, animal or plant life or health; 32 or
(c) to secure compliance with laws or regulations which are not inconsistent with the provisions of this Agreement including those relating to:
(i) the prevention of deceptive and fraudulent practices or to deal with the
effects of a default on contracts;
(ii) the protection of the privacy of individuals in relation to the processing and dissemination of personal data and the protection of confidentiality of individual records and accounts; or
(iii) safety.” (emphasis added)

Measures the EU would take to protect the public interest can go against CETA (“nothing in this Agreement”).

CETA and mass surveillance

In February 2016 the European Commission and Canadian government published the final draft text of the EU – Canada trade agreement (CETA). Before that the Court of Justice of the EU in October 2015 invalidated the Safe Harbour framework that allowed the transfer of European citizens’ data to the United States. The Court confirmed that cross border data transfer frameworks need robust privacy safeguards. However, during the legal scrub the European Commission did not make the CETA text compatible with the Court’s Safe Harbour ruling. This incompatibility exposes our privacy to interference.

EU consultation on IP enforcement; FFII submission

The European Commission has launched a consultation on the intellectual property rights enforcement directive (IPRED). The European Digital Rights initiative (EDRi) explains:

“Injunctions, internet blocking, blackmailing of individuals accused of unauthorised peer-to-peer filesharing — the so-called IPRED Directive has been very controversial. Now, the European Commission has launched a consultation on the Directive (…) The consultation is of great importance not only to those working on copyright or ‘intellectual property rights’ in general, but in fact crucial to anyone using the Internet.” Indeed! EDRi has prepared a very helpful answering tool.

ISDS Mantra

“Debating Europe” asked the Commissioner Malmström:
Can #TTIP negotiations proceed without the #ISDS mechanism? It is a very good question which the Commissioner did not answer. Here is my answer:
ISDS is just an enforcement layer and does not affect substantive elements. Thus we could do without. Historically, lack of enforcement layers was an academic critical talking point against the GATT process.

OpenTechSummit 2015 Berlin May 14

The OpenTechSummit will take place for the first time in Berlin on May 14, 2015 with the Foundation for a Free Information Infrastructure as a core partner and supporter. The Free and Open Source technology event brings together policy makers, developers, start-ups, and contributors. Topics at the OpenTechSummit range from future technologies, open hardware, encyclopedias, open data and free knowledge, software development, community networks and digital policies. In the evening there will be an “OpenTech-Himmelfahrt” lounge. The FFII is the main responsible for the track “Internet, Society and Patents”.

Ambitious US bargaining over Buy America

Spiegel Online quotes an internal document of the German Ministry of Economics on the TTIP negotiations (round 8):
Im Bereich der öffentlichen Beschaffung hat die US-Seite weitere Zugeständnisse mit der Aufnahme von Diskussionen zu Investitionsschutz / ISDS verknüpft. (In the area of public procurement the US side made further concessions conditional on the start of deliberations on investor protection /ISDS). The background is that the US negotiator side is very reluctant to revoke anti-free trade procurement policies like the Berry Amendments and Buy American, and has little support no support whatsoever from Congress for that. A removal of the enforcement layer ISDS is now used as a bargaining chip to stifle negotiation progress on public procurement. Given that ISDS is just an enforcement component it seems tricky to bargain over the substantive items such as public procurement.

Social democrats propose dangerously flawed ISDS reforms

Social democratic ministers from six EU countries published reform proposals for the highly controversial investor-to-state dispute settlement (ISDS) mechanism. ISDS gives foreign investors the right to bypass local courts and use international arbitration to fight out conflicts with states. The claimants have a 50% influence on the make up of the arbitral tribunals. For the short term the social democrats from Germany, Sweden, The Netherlands, Luxembourg, Denmark, and France propose to ratify the agreements with Canada and Singapore. These agreements are seriously broken.

Malmström has no idea how TTIP affects patenting

EU Trade Commissioner Malmström addressed a question from MEP Adam Gierek on TTIP effects on transatlantic patentability differences. The Commissioner did not actually answer the question of the Polish social democrat and responded with routine information: “Notwithstanding patent protection granted by US law to computer programs, our current international obligations ensure copyright protection in both parties.”  

5 February 2015 P-001944-15 Question for written answer to the Commission Rule 130, Adam Gierek (S&D)

Intellectual property rights and the TTIP
The patent systems in the EU and the patent system which operates in the US differ significantly in terms of patentability practice: in the US, GMOs can be patented, as well as computer programs, whereas in the EU the latter come under the category of copyright. Will the TTIP agreement not automatically result in the adoption of the previously rejected ACTA? Will the lack of harmonisation of the contracting parties’ intellectual property rights not lead to the unauthorised use of business computer programs by one of the parties?

The German Störerhaftung of Wifi

It does not feel good when you are exposed to risks. Exactly this happens, exposure to potential liabilities, when you share your Wifi connection in Germany with others. Störerhaftung, secondary liability. As a result you hardly find public open wifi spots anymore as we used to have them all over Germany in the early days.  The legal situation is actually quite mixed and the government prepared a new draft law that would not resolve the issue. In the case of the FFII e.V. it went like this, we had an open wifi in the office even when it was starting to get uncommon.

Open Source Strategy of the EU

A new Open Source Strategy applies a concept of equal treatment:
The Commission will ensure a level playing field to open source software when procuring new software solutions. This means that open source solutions and proprietary solutions will be assessed on an equal basis, being both evaluated on the basis of total cost of ownership, including exit costs. What is apparently the advantage of Open Source software is that you get the source code disclosed and enjoy the rights to build upon it. The argument of total costs of ownership is completely unrelated and does not even consider the advantages of the mentioned openness characteristics. A decision based on “total costs of ownership” actually implies that the Commission does not care at all to promote Open Source.

TPP ISDS is rigged to advantage U.S.

Update: final text is out, just as rigged. ————————————

Wikileaks has released the “Investment Chapter” from the secret negotiations of the TPP (Trans-Pacific Partnership) agreement. It contains the highly controversial investor-to-state dispute settlement mechanism (ISDS), which makes it possible for multinational to sue states for international tribunals. For a first analysis see Public Citizen. I will point out one aspect of the TPP ISDS section: it is rigged to the advantage of the U.S.

Rigged

The International Centre for Settlement of Investment Disputes (ICSID) is the most used ISDS forum.

International investment court plan threatens our democracy

The European Commission investigates a permanent international investment court as a replacement of the controversial investor-to-state dispute settlement mechanism (ISDS). The plan for a court and the road map towards it are fundamentally flawed. To protect our democracy the European Parliament has to reject both ISDS and court. Former vice-president of the European Commission in charge of justice and now member of the European Parliament international trade committee Viviane Reding proposed to replace ISDS with a permanent international investment court. Commissioner for Trade Malmström supports the idea.

Commissioner Malmström defends rigged ISDS in CETA

Today EU commissioner Malmström gave a speech in the European Parliament trade committee on investor-to-state dispute settlement (ISDS). ISDS gives foreign investors the right to use arbitration against states, instead of using local courts. Malmström made clear that she does not want to change the trade agreement with Canada (CETA), which contains a highly controversial ISDS section. The CETA text was used for the ISDS consultation. If CETA is ratified, multinationals from the US and other countries will be able to use the ISDS mechanism in CETA against the EU and its member states.

EU published 2 year old TiSA mandate

Today the EU declassified a two year old mandate of the member states to the European Commission to negotiate the services agreement TiSA. These mandates are drafted by the European Commission and approved by the member states in the European Council and authorise the European Commission to negotiate with third countries. The declassification shows that data flows are among the negotiated subject matters, a controversial item in a post-Snowden world. The agreement shall contain new or enhanced regulatory disciplines as compared to
GATS based on proposals by the parties. To that end, the negotiations should aim at including inter alia regulatory disciplines concerning transparency, domestic regulation, state-owned enterprises, telecommunication services, computer related services, e-commerce, cross-border data transfers, financial services, postal and courier services, international maritime transport services, government procurement for services and subsidies.

Vrijschrift letter highlights dangers ISDS in CETA and EUSFTA

A Vrijschrift letter to the Dutch Parliament highlights the dangers of investor-to-state dispute settlement (ISDS) in the trade agreements with Canada (CETA) and Singapore (EUSFTA). On 25 March EU trade ministers will meet (informally) to discuss trade agreements and ISDS. In preparation, the Dutch Parliament trade and development committee meets on 11 March. Today Vrijschrift has sent this committee a letter. Original in Dutch, translation:

Dear members of the BuHaOs committee,

On March 11 you will discuss trade agreements.

Unitary patents and software

The European Commission acknowledges that the unitary patent is not safeguarded against the granting of software patents by endorsing the EPO teaching:
21. Will the new unitary patent regime facilitate the patenting of computer programmes? The patentability requirements for European patents with unitary effect are identical to those of “classical” European patents. The envisaged regulation on unitary patent protection does not contain any particular disposition or derogation on the patentability conditions for inventions. As to the patentability of software, Article 52(2) of the European Patent Convention provides that programs for computers do not constitute a patentable invention.

White House defends ISDS

The United States government defends its investor-to-state dispute settlement (ISDS) model. It gives the US unfair procedural advantages. Rigged

The International Centre for Settlement of Investment Disputes (ICSID) is part of the World Bank. It is the most used ISDS forum; investors can choose this forum. The president of the World Bank has always been the candidate of the US.

VATMESS – EU harmonisation gone wrong for SaaS

Since 1 January 2015 online traders in the EU, selling items like “laser swords” in an app, have to apply the applicable value-added tax (VAT) rate to their purchases and submit the tax to the applicable tax authority of the responsible European member state. The new rules affect “laser swords”, document templates and SaaS but not traditional ecommerce trade of physical goods. Fortunately there is a “mini-one-stop-shop”, that is a single point of contact, subject to your registration, to declare and distribute the VAT. For your apps you have to engineer complicated solutions to determine the applicable member state of a net customer. The situation gets easier when your customer is a company with a VATIN, that is the European number of a VAT registered company.