ACTA and intermediaries

So, the text of the Anti-Counterfeiting Trade Agreement (ACTA) has been released. Much of what I’ve read so far brings me back to an earlier comment I made regarding one of the early drafts. If you don’t feel like reading the link, the gist of what I said is that the agreement was not particularly cumbersome, but that it contained two points of concern, the export of American punitive and statutory damages, and the criminalisation of a wider range of copyright infringement. Not much has happened to change my mind from that opinion. I have been advocating a “wait and see” approach to ACTA. Some of the leaks have worried me, but personally I do not think that the agreement will have the wide-ranging nefarious effect advertised. There is however, room for concern.

Having the full text really helps one to get an idea of what the changes to existing national legislation in the member states will really look like. Others have been talking about various aspects of the text. One of the most important issues dealt by the agreement is that it might have a huge effect on intermediary services. Habitual readers may have heard me talk repeatedly about how the current system of intermediary liability favours limited indemnity as long as intermediaries remove infringing content once notified. Some of the most interesting litigation in recent years has been directed precisely at trying to erode the limitation of liability, for example, in the case of iiNet and Eircom. Will ACTA change the current regime?

One big change in the new treaty is that it seems to overhaul the intermediary liability regime. For example, Article 2 establishes the obligation for signatory states to issue an injunction not only against infringers, but also against intermediaries:

“[2. The Parties [may] shall also ensure that right holders are in a position to apply for an injunction against [infringing] intermediaries whose services are used by a third party to infringe an intellectual property right.]”

This is very broad , and it pprovides a change to existing rules. For example, in the UK’s CDPA, s97A reads:

“97A.-(1) The High Court (in Scotland, the Court of Session) shall have power to grant an injunction against a service provider, where that service provider has actual knowledge of another person using their service to infringe copyright.” [Emphasis mine]

Notice that current law requires that the intermediary should have actual knowledge of the infringement taking place, while the ACTA text does not require such a thing. It would be possible then that courts could issue injunctions against service providers even if they have no knowledge of the infringement, which is a big change to the current system.

Later, The current text of Article 2.18 (3) seems to leave the current system of intermediary indemnity intact. It says:

“3. Without prejudice to the rights, limitations, exceptions, or defenses to [[ patent, industrial design, trademark and][copyright or related rights]][intellectual property rights] infringement available under its law, including with respect to the issue of exhaustion of rights, each Party [confirms that] [shall provide for] [civil remedies as well as limitations, exceptions, or defenses with respect to the application of such remedies, are available in its legal system in cases of third party liability[or liability for those who authorize infringement, or both] for [[patent, industrial design, trademark and][copyright or related rights]][intellectual property rights] infringement.”

This paragraph is rather vague, but I read it as pretty much leaving the current situation intact. The problem begins when we start looking at the optional texts. Option 1 seems to have been drafted by Google. It recognises that it infringement takes place under the vigilance of intermediary service providers, so it asks member states to provide limitations to liability only if the infringement occurs by:

“(i) automatic technical processes, and
(ii) the actions of the provider’s users that are not directed or initiated by that provider and when the provider does not select the material, and
(iii) the provider referring or linking users to an online location,
when, in cases of subparagraphs (ii) and (iii), the provider does not have actual knowledge of the infringement and is not aware of facts or circumstances from which infringing activity is apparent;”

So, this limitation of liability clause favours automated processes, and also the absence of editorial oversight. What is interesting, (iii) creates a new exception to liability by clearly stating that linking to infringing content is not in itself an offence. I am guessing this sub-section was included there by Google. This section however goes back to the existing UK regime, as it requires actual knowledge of the infringement taking place. Option 1 also seems to implement American Safe Harbour provisions, as it requires service providers to have clear removal policies, as well as working expeditiously to remove content. Further evidence that ACTA is mostly exporting DMCA protection worldwide. Option 2 is similar, but rather more concise.

So what’s in store for intermediaries? The good news is that American service providers which already operate under the DMCA take-down regime will not be affected. The bad news is that other service providers will have to revamp their take-down procedures to DMCA-style levels.

As evidenced by the take-down of Downfall parodies from YouTube, I fear for the future. Funnily enough, a video of Hitler denouncing ACTA has been taken down for copyright violation. Rather poignant, is it not?