The North American Free Trade Agreement (NAFTA) renegotiations may bring stronger Intellectual Property Protection.
International trade negotiations are focused on intellectual property rights issues now more than ever before. Will the renegotiation of the North American Free Trade Agreement (NAFTA) change the future of intellectual property law internationally? Is NAFTA really “the single worst trade deal ever approved in this country” as according to President Trump?
On May 18th, 2017, the Office of the United States Trade Representative (USTR) served a notice to Canada and Mexico to renegotiate many of its provisions, including the sections dealing with intellectual property rights.
While it is true that it may be burdensome for Canada and Mexico to implement all the changes set out in the US Objectives, the proposed changes to intellectual property provisions as a whole would also result in modernising some intellectual property laws internationally.
The original NAFTA between the United States, Canada, and Mexico which has been in force for 23 years, since January 1st. It was drafted around the World Trade Organization’s Trade-Related Aspects of Intellectual Property Rights Agreement (TRIPS). NAFTA is the first international trade agreement to address intellectual property rights.
The existing intellectual provisions of Chapter 17 of NAFTA were drafted broadly enough so as not to become outdated with future technological changes. NAFTA addresses intellectual property issues in a broad way, leaving room for interpretation while avoiding conflicts with domestic and international law.
NAFTA protects intellectual property in three ways:
1. Establishing minimum standards of protection based on major international intellectual property conventions.
2. Enforcement of intellectual property rights at the border with respect to imported products.
3. Dispute settlement procedure with trade related sanctions and damages. This dispute settlement procedure provides a member state with additional recourses for intellectual property infringements beyond its own domestic laws.
The NAFTA intellectual property provisions were drafted so that freedom of trade is not hindered by disparate intellectual property laws in each member state. At the same time, NAFTA’s objective is to ensure that the enforcement of those intellectual property provisions should not become a barrier to trade.
The current NAFTA treaty in Article 1703 provides for national treatment in that each member state shall accord to another member state no less favourable treatment than it accords to its own nationals with respect to the adequate protection and enforcement of intellectual property. The member countries also agreed to the provisions of chapter 17 and the provisions of the Geneva Convention and the Berne Convention (Paris Revision, 1971).
The newly proposed US Objectives would be more prescriptive and specific than the current NAFTA provisions which are more broad and general.
The US Objectives for NAFTA Renegotiation
The US felt it was necessary to renegotiate NAFTA due to changes in the US economy and global trading relationships which the US felt were impeding American exports. The US believes a renegotiation will modernise NAFTA, correct US trade imbalances and bring more equitable market access to US businesses through the elimination of unfair subsidies, market-distorting practices by state owned enterprises, and burdensome restrictions on intellectual property.
The U.S. proposed goals and objectives to NAFTA are outlined in their document entitled, “Summary of Objectives for the NAFTA Renegotiation” on July 17, 2017 (the “US Objectives”). It will bring Canada and Mexico in line with US laws offering greater protection and enforcement for rightsholders. Other US Objectives may be restrictive and economically burdensome for Canada and Mexico. The first round concluded August 20th of this year. The second set of negotiations commenced on September 1st with the final round to take place at the end of September.
The US Objectives in renegotiating NAFTA for Intellectual Property include:
- Promote adequate and effective protection of intellectual property rights, including through the following:
- Ensure full implementation of the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS)
- Ensure intellectual property provisions have the the same standard of protection as that found in U.S. law
- Provide protection for emerging technologies and new methods of transmitting and distributing products that embody intellectual property such as digital trade
- Prevent discrimination with respect to intellectual property rights use and enforcement
- Ensure standards of protection and enforcement that keep pace with technological developments and ensure rightsholders have the legal and technological means to control the use of their work and prevent the unauthorized use of their works
- Provide strong intellectual property rights enforcement through civil, administrative and criminal enforcement
- Prevent government involvement in the violation of intellectual property rights, including cyber theft and piracy
- Equitable and nondiscriminatory market access for United States intellectual property rights holders
- Respect the 2001 WTO TRIPS Agreement and Public Health Ministerial declaration at the Fourth Ministerial Conference at Doha, Qatar on November 14, 2001, and ensure trade agreements foster innovation and promote access to medicines
- Prevent the undermining of market access for U.S. products through the improper use of a country’s trademark system with respect to geographical indications, including failing to protect generic terms
On the whole, some changes desired by the US will encourage innovation and creativity such as expanding the term of copyright or dealing with ISP liability and safe harbours for online infringement. However, other US demands may diminish innovation and create an economic burden in implementing further changes such as increasing criminal sanctions and the trade of digital goods across the border.
For more a more detailed analysis on how the changes will affect Canadian IP, read more at entcounsel.com.