The Comprehensive Economic and Trade Agreement (CETA) is a proposed free trade agreement between Canada and the European Union. It is yet another alphabet soup that was cooked by our dear policy makers without first asking the public if it is hungry for any change of intellectual property protection/enforcement. As most of the other alphabet soups these days, also this was kept secret in order not to be [b]eaten by people before its ready for serving. Until, well, until German Tagesschau leaked its entire 521 pages long recipe this week.
The intellectual property chapter of CETA (Chapter 22) also contains several provisions regulating Internet intermediaries. And exactly these provisions should not be overlooked.
For the Europeans, intermediary liability provisions of CETA might first even appear boringly predictable as they do not seem to add anything new to the Union law. But this would be misleading. First of all, these provisions are definitely TRIPS-plus provisions, and if coupled with strong investment protection before the arbitration courts, flexibility of any reform of these provisions in the existing Union law will be near to zero. So as long as CETA goes beyond TRIPS, it automatically also adds to the Union law a new international obligations, which did not exist before.
For the Canadians, these obligations can be more groundbreaking. CETA seems to mandate that (i) safe harbours should not limit injunctions and that (ii) injunctions should extend also to innocent (non-infringing) intermediaries. I have zero knowledge of the Canadian law, but I would humbly predict that at least (ii) is not currently provided for.
Article 5.5 of CETA seems to guarantee the safe harbours in the domestic law. Sounds like a great step, doesn't it? After taking a closer look, however, it becomes clear that domestic law is almost completely free in legislating the exact conditions for the two most important safe harbours, namely hosting and mere conduit ["Each Party may prescribe in its domestic law, conditions for service providers to qualify for the limitations or exceptions in this Article." (Art. 5(5)(4))]. In fact, the only thing the provision seems to guarantee is that some safe harbours for the two activities will exist in the domestic law, and that those domestic conditions can not be conditioned "on the service provider monitoring its service, or affirmatively seeking facts indicating infringing activity" (Art. 5(5)(3)). The more precise notice and take-down system, or counter-notification system is optional (Art. 5(5)(4)). Moreover, this applies only "when [they are] acting as intermediaries" [which sounds like a good Trojan horse for concepts like "passive intermediaries"]. Oh, and did I mention that this all concerns only "copyright or related rights" (Art. 5(5)(1))?
The most important mandatory rule of the safe harbours then seems to be what comes next:
This Article shall not affect the possibility of a court or administrative authority, in accordance with Parties' legal systems, of requiring the service provider to terminate or prevent an infringement.
For non-Europeans. Similarly worded rules in the E-Commerce Directive make safe harbours "injunctions-leaky" in the EU. And they are, together with some other provisions (Art. 8(3) InfoSoc, etc.), increasingly responsible for the most of the private actions against Internet services providers on the old continent [see overview here and here]. Without appropriate cause of action, of course, this would be only a half-way attempt to import the current European trend of increasing accountability of intermediaries by blocking and filtering injunctions or as US scholars would frame it - a system of more preventive notice-and-stay-down requirements.
But CETA does not stop half-way. Article 20 provides for a [differently worded] private cause of action for injunctions against innocent third parties:
1. Each Party shall provide that, in civil judicial proceedings concerning the enforcement of intellectual property rights [by accident not only copyright and related rights?], its judicial authorities shall have the authority to issue an order against a party to desist from an infringement, and inter alia, an order to that party, or, where appropriate, to a third party over whom the relevant judicial authority exercises jurisdiction, to prevent infringing goods from entering into the channels of commerce.
Please note that this a shall-provision. And that its wording could potentially achieve everything that European system of Art. 8(3) style of injunctions does today. And yes, it is exactly the provision which was among other things strongly criticized in ACTA. In fact, ACTA started (Article 2.X.2 of ACTA April Draft 2010) with a provision which was just copy and paste of Art. 8(3) InfoSoc ["The Parties [may] shall 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."]. The provision has proved, however, too controversial. Surprisingly, not because of the concerns of the Internet service providers, but of health activists who were worried about the access to medicines. This language was eventually dropped in the September 2010, but substituted by the following provision:
“Each Party shall provide that, in civil judicial proceedings concerning the enforcement of intellectual property rights, its judicial authorities shall have the authority to issue an order against a party to desist from an infringement, and inter alia, an order to that party or, where appropriate, to a third party over whom the relevant judicial authority exercises jurisdiction, to prevent infringing goods from entering into the channels of commerce.”
As you can see, this provision from the September version of ACTA is the same rule, which now re-appeares in Art. 20(1) CETA. If it becomes the law in Canada one day, its citizens can be also looking forward to a flood of privately litigated website blocking, disconnecting, filtering and other kind of creative injunctions.
One of the senior official at the Commission in Brussels told media that: "The free trade treaty with Canada is a test for the agreement with the United States". Well, if this is the case, than US readers of this blog might "forget" about their fears from their national reform of the DMCA, given that a "reform" might soon unexpectedly come from TRIPS-plus "waters".