The Canadian government’s deadline for written submissions to the consultation on the renegotiation of the North American Free Trade Agreement closes today (though the government just announced that it will continue to accept comments on its form after the deadline). My submission to the consultation is posted below. I focus on two chapters: intellectual property and the new e-commerce chapter.
The submission begins with three broad comments and recommendations including the need for trade transparency, recognizing the importance of IP and e-commerce (and therefore not easily giving on those issues for gains elsewhere), and the desirability of an explicit commitment to balance as an objective in the IP chapter.
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Another Trouble with the TPP is its foray into the software industry. One of the more surprising provisions in the TPP’s e-commerce chapter was the inclusion of a restriction on mandated source code disclosure. Article 14.17 states:
No Party shall require the transfer of, or access to, source code of software owned by a person of another Party, as a condition for the import, distribution, sale or use of such software, or of products containing such software, in its territory.
The provision is subject to some limitations. For example, it is “limited to mass-market software or products containing such software and does not include software used for critical infrastructure.” The source code disclosure rule is not found in any other current Canadian trade agreement, though leaked documents indicate that it does appear in a draft of the Trade in Services Agreement (TISA).
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As part of the U.S. effort to drum up support for the TPP, President Barack Obama enlisted the support of eBay, sending an email to 600,000 merchants that claimed that the agreement would help e-commerce and small merchants. That message was repeated by Andrea Stairs, the managing director of eBay Canada, who wrote an op-ed in the Financial Post that similarly pointed to the e-commerce rules, de minimis customs rules, and the benefits for small and medium sized business. The Trouble with the TPP is that a closer look at the text reveals that the benefits from the e-commerce provisions, de minimis rules, and the much-touted SME chapter are practically non-existent.
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The Trans Pacific Partnership (TPP), a massive trade agreement that covers nearly 40 per cent of world GDP, wrapped up years of negotiation earlier this month. The TPP immediately emerged as an election issue, with the Conservatives trumpeting the deal as a source of future economic growth, the Liberals adopting a wait-and-see approach (the specific details of the agreement are still not public), and the NDP voicing strong opposition.
The focal point of most TPP discussion in Canada has centered on two sectors: the dairy industry, who would experience a modest increase in competition and receive a staggering multi-billion dollar compensation package, and the automotive parts sector, which would face Asian-based competition as a result of new, lower local content requirements (the industry is also pressing for a compensation package).
My weekly technology law column (Toronto Star version, homepage version) notes that lost in the discussion over imported butter and Japanese-made auto parts are the broader implications of the TPP. New rules on corporate lawsuits could result in more claims by foreign corporations against the Canadian government over national policies or court decisions (pharmaceutical giant Eli Lilly is already suing the government for $500 million over Canadian patent rulings) and an extension in the term of copyright beyond the international standard would lock down the public domain for decades and potentially cost Canadians hundreds of millions of dollars per year.
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Without the CETA text, it is very difficult to assess many of the purported benefits of the draft agreement (additional posts on the need to release the text, the IP provisions, and the big win for pharmaceutical companies despite declining Canadian investment in research and development). Consider the benefits for telecommunications and electronic commerce discussed in the government’s summary document. On electronic commerce, the government states:
Businesses engaged in electronic commerce will benefit from greater certainty, confidence and
Twenty years ago, electronic commerce was in its infancy. Today, electronic commerce is a part of our daily lives. Canadians shop and plan holidays online, and buy and download software and entertainment content, including movies, television and music. Advertisers are making increased use of â€œsmart advertisingâ€ on the Web to track our shopping habits and promote specific deals likely to interest us.
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