May 16,2013 lv[r. Robert Hormats Under Secretary of State for Economic, Energy, and Agricultural Affairs US. Department of State 2201 Street NW Washington, DC, 20520 Transatlantic Trade and IPR Leadership Needed in WIPO Treaty Negotiations Dear Under Secretary Hormats, We wish to draw your urgent attention to treaty negotiations underway at the World Intellectual Property Organization Urgent, transatlantic leadership is needed to change the course of these negotiations, which threaten to undermine years of effort to protect American and European competitiveness, support jobs, and maintain our robust innovation and technology infrastructures. At WIPO, the U.S., EU, and other nations are in the final rounds of negotiations on a treaty to improve access by visually-impaired persons and persons with print disabilities to copyrighted works A WIPO Diplomatic Conference has been scheduled for 17-11% June 2013 in Morocco, at wl1ich'WIPO Members plan to final ize negotiations and sign the treaty. Improving access to copyrighted works by persons who are visually impaired or suffering from print disabilities is a worthy objective. We support, in general, efforts by the U.S., the EU, and the international community to find effective solutions to the challenges faced by these groups. In particular, we support conclusion of a balanced and workable international agreement that etfectiyely addresses their needs. This is not the treaty on the table. As currently drafted, the VIP Treaty would set a negative precedent, reversing years of joint and EU efforts to prevent the erosion of global Intellectual Property Rights (IPR) and undermining the US. and EU negotiating positions in a range of other global and trade negotiations. Urgent, transatlantic leadership is needed, including a clear leadership decision that conclusion of the VIP Treaty in June would be premature. In any event it is critical that USTR and DG Trade officials are represented in person at any further meetings to secure redlines and ensure that agreed text is aligned with existing public intemational law, includitlg and free trade agreements. 1 WlP0'Treaty to Access by the Visually-Impaired and Persons with Print Disabilities to Copyrighted Worlm Treaty"). iftfiitjg Agreement of the Treaty on the basis of this text (or anything approxirnating it) could negatively affect US. and EU II?-related negotiating positions across global forums for years to come. The risk of contagion is not limited to copyright issues alone, but spans the entire range of IPR issues, including also patents,' trade secrets, and trademarks. US. and EU positions in the ongoing debates at WIPO, the World Trade Organization (WTO), the UN Framework Convention on Climate Change where IPR issues have been a politically divisive issue for years -- and the World Health Organization (WHO) would certainly be undermined. As you know, patents, trade secrets, and other forms of1PR. that protect and differentiate brands are critically important. for and E.tii'opean advanced manufacturing and technology industries and the broader business community. The value of such IPR assets is hard to overstate, as is the shared interest between the US. and EU in ensuring elfective systems for IPR protection around the world. lP-intensive industries are linked to 35% of U.S. GDP and nearly 3i}% of all U.S. employment. The EU is no less reliant on innovative, advanced manufacturing and technology industries for its competitiveness, economic recovery, and for Europeanjobs. Time between now and the une Conference is unfortunately too short to resolve all or even most of the critical probl ems with the VIP Treaty text. Joint EU and US. leadership is urgentiy needed to: first, for the many remaining problems in the current text {background paper attached); second, ensure that an appropriate balance bctwecn rights and exceptions consistent with existing US, EU and international IPR'law -- is maintained; and, third, ensure that the long--term interests of the and people with print are properly served. Given the deficiencies in the current. text, and the risk of failure at the Diplomatic Conference, it would seem prudent to take more time. Conclusion of the VIP Treaty in June would be premature. We look forward to discussing these issues firrther with you or any of your -services, and are of course available for any questions that you or they may have. Sincerely, 29 Tim Bennett Director General Transatlantic Business Council Background on VIP Treaty Negotiatiotts May 7, 2013 According to the Worldilealth Organization, there are more than 314 million. visually impaired people worldwide- Of these, 45 million are blind, 90 percent of vvhoni live i.n developing countries.' in wealthier countries, only a small fraction of published books are made in accessible formats for the visually impaired. Even fewer works are available in low income countries, resulting in a "book fantinej' depriving the visually impaired access to education, culture, and entertaininent. Most accessible books are made by specialist, nonprofit. agencies. In many cases these organizations use copyright. exceptions available in national law. However, relatively few countries have such exceptions, and the scope of existing exceptions varies considerably: Even when exceptions exist, since copyright is a creature of national law, the provided exceptions cannot be used to benefit those in other countries. As a result, efforts to make books accessible are often duplicated, expending the limited resources of these agencies. To address these issues, Members of the World Intellectual Property Organization 0) have entered into negotiations on a new treaty to improve access by the visually--irnpaired and persons with print disabilities to copyrighted works Treaty"). The primary objectives of the Vll' treaty are to 1) facilitate the creation of accessible format works by harmonizing exceptions and limitations across national jurisdictions and 2) enable cross border sharing of such. works- Status of the Negotiations A WIPO Diplomatic Conference is scheduled for l'l'--23 June 2013 in Morocco, with the aim of finalizing the WTPO VIP Treaty. During the most recent round of negotiations, taking place at Wl1'O's Standing Ct:-rntnittee on Copyrights (SCCR) between April 18-20, ahighly bracketed text was tabled. Numerous complications have emerged since then and it appears that none of the stakeholders are satisfied with the text in its current form. At the same time, there is a real risk that the treaty will be concluded in June, because of political pressure on WIPO to "deliver". Given the current status of negotiations, the planned Diplornatic Conference is premature and in danger of delivering no treaty at. all or a watered down instrument that does not serve its intended purpose. Such a result would not reflect well on the global system. Instead, it would be advisable to postpone adoption ofa VIP Treaty until a text has been developed that all stakeholders can support and that adequately addresses the core lI'I-1-related concerns discussed World Health Organization, "Prevention of Avoidable Blindness and Visual Impairment: Report by the Secretariat," Sixty-Second World Health Assembly, Provisional Agenda Item E23 (AEZIT), April 2, 2009, 2 Study on Copyright Limitations and Exceptions for the Visually impairs. February 2037. Available at: {rang further detail below? In our view this is necessary but will be politically difficult, given that W1P0's Director General, Francis Gurry, a number of N605 including the World Blind Union and and the Africa group in particular, are pushing for the treaty to be signed itnrnediately. Broader Context The VIP Treaty negotiations are taking place against the backdrop of broader international efforts, by certain advanced errlerging economies and N603, to weaken Intellectual Property Rights protection in general, including copyrights, but also patents, and trade secrets. Such efforts so far haw': FOCLISCCI in particular on the UN Frarnework: Convention on Climate Change Where India, China and certain other countries as well as key NGOS have detnanded "flexibilities" for clean teehnologywelated the World Health Organization and the World Trade Organization (WTO). The same group of countries, moreover, is also pursuing at range of domestic policies to the same efi_'ecL Thus, for example, India specifically calls for compulsory licensing of clean techtlology patents in its National Manufacturing Policy. Key Problems with the VIP Treaty (as currently drafted} International copyright law is firndarnentally based on a balance between the rights of copyright owners, and certain Limitations cit Exceptions that can be imposed in a very liniited set of circumstances. This balance is reflected, inter aim, in the so-called "three--step"' test. Aceordin to this test, any UE shall he limited to "special cases", (ii) is only allowed "provided that reproduction does not conflict with a normai exploitation of the [copyrighted] work"; and when it "does not unreasonably prejudice the legitimate interests of the right holder". Any Lfl-i framework, moreover, only makes sense where copyrights are properly in international and domestic legal instruments as well. It do es not make sense to have an exception without the corresponding basic rule. The VIP Treaty as currently drafted does not reflect the appropriate balance between copyright protections, on the one hand, and LIE to copyright protection, on the other hand: 0 As currently drafted, the Vii' Treaty isolates LIE from the basic copyright protections to which they pertain even though many of the eventual signatory countries do not provide any copyright protections whatsoever. In these countries, in other words, Limitations and Exceptions would exist without the related copyrights protections -- to which such LIE pertain. It does not make sense to agree to LIE when basic rights are not yet in place. The drafi: VIP Treaty reflects a compromise version ofthe "three-step" test which is inadequate and likely to confusion. At a therefore, the existing "three- step" test must be spelled out clearly and apply to the entire agreement and to all signatories. The European Union made a proposal to this effect in 2012 that should be revisited and agreed. 3 This does not mean the Diplomatic Conference itself would necessaiily have to be postponed; but that it should focus on a Plan option, rather than agreement on a. treaty that is not satisfactory to any of the parties concerned. itscg it': - The VIP Treaty, in its current form, is strongly supported and advanced by the same group of NGOS and advanced emerging economy countries that pursue a general IP12- weakenirig agenda at WIPD and in other it-lterrtational fora. As Currently drafted, the VIP Treaty would create a harmful precedent that could be relied "upon by detractors in other talks, including at WHO, and WTO. Given the highly politicized nature of this broader debate, and the aggressive agendas of the co untries involved, this is a real and immediate risk.