The leak of the draft notice from the Trump Administration on the NAFTA renegotiation, which identifies at least 40 issues, will serve as the starting point for discussions once talks begin. Coverage of the U.S. interests has emphasized tariff issues, rules of origin, and tax treatment, but the digital issues should not be overlooked. The U.S. starting position looks a lot like the TPP, which suggests that we already have a very clear understanding of the text that U.S. negotiators will propose. This post unpacks some of the general language to decipher what the U.S. has in mind on intellectual property issues. A second post will review the other digital issues, including privacy and e-commerce rules.
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In the early 1990s, Eli Lilly applied for patent protection in Canada for two chemical compounds, olanzapine and atomoxetine. The company had already obtained patents over the compounds, but asserted that it had evidence to support new uses for the compounds that merited further protection. The Canadian patent office granted the patents based on the content in the applications, but they remained subject to challenge.
Both patents ultimately were challenged on the grounds that there was insufficient evidence at the time of the applications to support the company’s claims. The Federal Court of Canada agreed, invalidating both patents. Eli Lilly proceeded to appeal the decision to the Federal Court of Appeal and later to the Supreme Court of Canada. The company lost the appeals, as the courts upheld the decision to invalidate the patents.
Under most circumstances, that would conclude the legal story as several Canadian courts reviewed Eli Lilly’s patent applications and ruled that they failed to meet the standards for patentability. Yet in June 2013, the company served notice that it planned to use the ISDS provisions in the North American Free Trade Agreement to claim that in light of the decisions, Canada was not compliant with its patent law obligations under the treaty. As compensation, Eli Lilly sought at least $500 million in damages.
As Canadian Heritage Minister Melanie Joly’s consultation on Canadian content in a digital world nears its conclusion – comments are due by November 25th – the big issue remains how to pay for an ambitious culture agenda. Joly has emphasized the benefits of expanding exports, which she hopes will bring foreign dollars and more foreign investment in the sector. While a stronger global presence makes sense, many of the established cultural groups have voiced opposition to measures designed to attract greater foreign participation if it risks reducing the guaranteed Canadian role in productions.
For example, the CRTC’s decision to loosen some Cancon rules has elicited ongoing anger, despite the fact that the change would likely make productions with foreign entities more attractive, thereby enlarging the overall size of the industry in Canada. With similar opposition to market-based reforms designed to reduce dependence on the current system (pick-and-pay television channels, gradual reduction of simultaneous substitution), there is little reason to believe that Joly can count on support for expanded exports to pay the bills.
This post unpacks some of the cultural policy options that have surfaced in recent weeks. The post stems from a panel discussion at the University of Ottawa featuring a paper by Richard Stursberg and commentary from myself, the Globe’s Kate Taylor (who covered the panel here), and ACTRA’s Ferne Downey (Stursberg’s paper is here, full video of the event here).
I have personally worked very hard, but it is now evident to me, evident to Canada, that the European Union is incapable of reaching an agreement – even with a country with European values such as Canada, even with a country as nice and as patient as Canada. Canada is disappointed and I personally am disappointed, but I think it’s impossible. We are returning home.
Leaving aside the odd reference to how nice Canada is, this is remarkable language that lays bare the obvious frustration and disappointment for the government which prioritized the CETA agreement above all others. The prospect of the deal falling apart has been evident for months. I wrote in July that the agreement was in more trouble than the Canadian government would admit, noting that opposition from any national or regional government could kill CETA altogether. Canadian officials downplayed the risk, but it was obvious that CETA faced stiff opposition that would not be easy to overcome.
Canadian Heritage Minister Melanie Joly’s release of the Canadian content in a digital world consultation is likely to spark renewed demands from industry stakeholders for more money from two main sources: unregulated Internet companies such as Netflix and the government. As I noted in my first post on the consultation release, there is a significant divide between the industry and the public on the issue. Industry stakeholders emphasize more public and government support, while the public is focused on efforts to promote Canadian content.
The government will surely wait for the consultation to close before adopting firm positions, but the new consultation paper makes it clear that not everything is on the table. In fact, it adopts several notable policies and sends some signals about future funding sources.