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Key policy issues in intellectual property and technology in Asia Pacific

Article Index
Key policy issues in intellectual property and technology in Asia Pacific
Copyright and its impact on access to knowledge and technology
Flexibilities under TRIPS
Non-proprietary models
Strong vs. weak IPR
Bilateral agreements and TRIPS-plus standards
Multilateralism as the way ahead for developing countries

Bilateral agreements and TRIPS-plus standards

Over the last decade, developed countries such as the US and the European Union have hotly pursued bilateral and regional free trade agreements (FTAs). US trade policy has been to promote IP rules that reflect a standard of protection similar to that found in US law. Asia Pacific trade partners considering and committing to these more stringent IP rules allegedly do so in exchange for other concessions, such as preferential access to US markets for manufactured and agricultural products. However, such FTAs go beyond TRIPS in terms of protection of patents and pharmaceutical test data, ICT-related areas, copyright protection and enforcement of IP rights. It is also important to note the manner in which FTAs are used by the US as part of a strategy to push for TRIPS-plus standards at a multilateral level. When the US has a whole range of FTAs with small developing countries, it can then claim that these standards are accepted worldwide and should become a global standard.

What follows is a briefcase study for the Asia Pacific region—the Singapore approach to FTAs. The discussion highlights some key implications of the IP provisions Singapore committed to under its FTA with the US (hereafter USSFTA).

Singapore is a trade-dependent nation with a cumulative trade volume presently accounting for about thrice its Gross Domestic Product (GDP). While maintaining its commitment to the WTO as a route to global trade liberalization, Singapore actively pursues trade liberalization through regional platforms, such as the Association of Southeast Asian Nations (ASEAN) and the Asia Pacific Economic Community (APEC). The East Asian crisis of 1997–98 and the consequent slowdown in trade and investment liberalization are allegedly the impetus for Singapore's foray into bilateral FTAs with key and strategic trading partners. This strategy aims to increase economic ties and garner 'first-mover' advantage with key and strategic trading partners, enhancing market access opportunities beyond the region and in emerging market economies similarly committed to trade and investment liberalisation in the goods and services sectors.

The USSFTA is ranked as the most comprehensive that the US has achieved with an ASEAN economy and is considered a 'landmark agreement' for its WTO-plus and NAFTA-plus [North American FTA] commitments' (IES 2007). The provisions on IP are particularly remarkable. As described in Singapore's FTA Network,6 'stronger IPR protection set[s] [the] ground for knowledge-based industries' and is a means for securing and maintaining competitive advantage on innovation and capability development in fields such as the creative industries, information technology (IT), pharmaceuticals, science and other high-technology industries.

In the trademarks arena, the key provisions are Singapore's commitment to enhance its trademarks regime to register 'unconventional' or non-visually perceptible marks, such as sound or scent marks, and to accord stronger protection for well-known marks to prevent dilution.7 On patents, commitments were secured to strengthen existing patent regimes of both countries to protect bio-inventions. Singapore was to accede to the International Convention for the Protection of New Varieties of Plants (UPOV) to provide a system for better protection of new plant varieties,8 and both countries agreed to maintain the current regimes that would allow all inventions to be patentable, subject to the condition that they are not contrary to morality or public order. Also crucial was the commitment to limit the use of compulsory licences to safeguard against anti-competitive practices, public non-commercial use, national emergencies and other circumstances of extreme urgency. All commitments relating to trademarks and patents were implemented by Singapore on 1 July 2004.

On copyright, Singapore and the US agreed to align their terms of protection for copyrighted works, performances and phonograms. Thus the term of protection in Singapore, effective 1 July 2004, is the period of the 'life of the author plus seventy years' or, as applicable, 'seventy years after first publication, broadcast or performance'.9 A further commitment was the adoption of additional protection standards in relation to the digital environment and the World Wide Web. Effective 17 January 2005, Singapore acceded to the WCT and the WIPO Performances and Phonograms Treaty (WPPT). Singapore incorporated substantive anti-circumvention provisions to prohibit tampering with technological protection measures and to prevent piracy of copyrighted works over the Internet in view of activities such as online distribution of software, music and publications. Thus, these unlawful acts now carry both civil and criminal liability, independent of any liability for copyright infringement. Provision was made for immunity for Internet (Network) service providers that comply with notification and take-down procedures when suspected infringing material is hosted, stored or transmitted on or through their servers or networks.

To complement these commitments on enhanced IP standards, specific obligations on IP enforcement were entrenched, including anti-piracy enforcement aligned with closer industry consultation and collaboration. Effective 1 January 2005, Singapore incorporated enhanced criminal sanctions to penalize any entity (whether a business or an individual) not only for copyright-infringing activities wilfully carried out for profit or in a commercial setting, but also where the impact of the activities are significant. Effectively therefore, certain forms of end-user infringement or piracy now amount to criminal offences. Another provision worth mentioning is that Singapore agreed to stronger rights for copyright owners in providing, for example, that in trademark and copyright infringement actions, the owners could, where they find it difficult to calculate the actual damages suffered, opt instead, as provided to owners under the US regime, for the remedy of statutory damages (compensation based on a preset range).

Both Singapore and the US resolved on measures for prevention of and enforcement against illegal manufacture, import and export of counterfeit and pirated goods, and in regard to optical disc manufacturing activities, Singapore committed to formalize its regime of regulating these activities through the imprint of Source Identification Code on optical discs (unless specifically exempted by the rights' owners) and to criminalize businesses that make pirated copies from legitimately purchased products.10 Overall, the Singapore perspective on the IPR measures incorporated in the USSFTA is that they are relevant and necessary to 'encourage more R&D and knowledge-intensive activities to be located in Singapore' and raise IP 'protection levels to US standards' (Sen 2004).

It is not easy to assess the substantive social and economic implications of these IP commitments. The underlying principle seems to be that a strong IP regime 'provides an incentive for research and development and a ladder on which industry can climb up the value-chain'. Efforts are ongoing to effectively monitor the social and economic effects of the implementation of these provisions through consultations with industry and all relevant stakeholders. According to commentators, the objective of the monitoring efforts is to secure 'a balance between granting exclusivity and allowing for the free flow of ideas and knowledge sharing' (Koh and Lin 2004, p. 133).

Singapore authorities went through public consultation exercises in formulating legislative amendments to its IP laws. One example is obtaining industry feedback11 to determine what copyright material should be excluded or exempted by the Minister for Law from the prohibition against circumvention of technological access control measures.12 This highlights the measures that sophisticated Asia Pacific governments must consider for implementation after committing to far-reaching IP provisions in its FTAs.

There are some general advantages and costs that come hand-in-glove with the new IP standards. Generally, the empirical studies do not indicate that countries that strengthen their IP regimes are likely to 'experience a sudden boost in inflows of foreign investment' although it is generally believed this could stimulate cross-border licensing activity and technology transfers. Policymakers must address the growing concerns that rules relating to copyright term extension, technological protection measures, liability of Internet service providers, end-user criminal liability for copyright piracy and the shift of the burden of proof for copyright infringement cases will endanger the rights of local consumers.

The overarching question has been to what extent these rigorous commitments were imperative to Singapore, the extent to which reviews and benchmark studies had been carried out and/or evaluated on necessity and scope and the extent of local and non-governmental involvement in available reviews during the negotiations. In addition, neighbouring Asia Pacific countries13 have been confronted by the rigour of the Singapore commitments in their own ongoing negotiations with the US (Endeshaw 2005). Thus, it must be acknowledged that the USSFTA could have a disempowering effect on other policymakers in developing countries in Asia Pacific who are dealing with powers such as the US and the EU which are slow to and effectively need not take it on themselves to evaluate the full impact of rigorous IP provisions.

Asia Pacific countries can take away several lessons from the USSFTA TRIPS-plus obligations specifically in relation to ICT-related areas, copyright protection, software protection, indigenous knowledge and enforcement of intellectual property rights. First, in negotiating IP issues in bilateral agreements, each Asia Pacific country should strive to anticipate provisions that their trading partner will propose and be the one to take the bold stance to table novel rules, related incentives and alternative mechanisms on policy areas where there are clear and significant interests. Some important examples are proposals that relate to data protection and cultural heritage or traditional knowledge.

Second, cognizant of the political stakes in these negotiations, policymakers should take measures to secure decisions that are clearly both open and transparent. This will mean that prospective options on policies and negotiating positions should be made accessible to the public to obtain feedback from relevant key local corporations and industry sectors and reconcile differing viewpoints or concerns via transparent processes.

Third, to secure maximum local understanding and participation on issues, policymakers need to foster public awareness. This may require tasking and collaborating with the local media to send clear and consistent messages on these issues to the general public.

Fourth, policymakers of developing countries in Asia Pacific should diligently consider the fact that enhanced enforcement will translate to additional costs in terms of expenses for budget outlays and training of enforcement officers. They should question whether stronger enforcement of IP rights will take away resources from other development priorities and the extent to which this is acceptable.

Finally, policymakers should assess, (a) the need to promote non-proprietary IP, (b) the need to provide a commons to promote innovation and economic development and (c) the need to provide public subsidies for development of free and open source software.


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