|Free Trade Area of the Americas - FTAA|
COMMITTEE OF GOVERNMENT REPRESENTATIVES ON THE PARTICIPATION OF
CONTRIBUTION IN RESPONSE TO THE OPEN AND ONGOING INVITATION
Executive Summary: Comments of the
Semiconductor Industry Association to the Negotiating Group on
September 29, 2003
The Semiconductor Industry Association (“SIA”) of the United States welcomes the opportunity to submit comments pursuant to the open invitation to civil society in countries participating in the Free Trade of the Americas (‘FTAA”) negotiations. The SIA is the leading voice for the U.S. semiconductor industry and has represented American-headquartered manufacturers since 1977. SIA member companies comprise approximately 85% of U.S.-based semiconductor production. Our member companies have global manufacturing and distribution.
SIA strongly supports the protections offered by the WTO’s Trade Related Intellectual Property (TRIPS) code, and would caution against weakening of TRIPS. The TRIPS was a result of years of negotiation to strike a balance among inventors, consumers, and other stake holders. This balance should not be lightly discarded.
Countries that offer reliable protection of intellectual property are far more likely to enjoy the benefits of high technology investment and the peripheral benefits that it offers than those who do not. In fact, some of the proposed paragraphs under Part I (General Provisions and Basic Principles) Article 9 (Technology Transfer) and Part II, Section 5 (patents) article 5 (Other Use without Authorization of the Rights Holder) would be very counter productive because, by failing to refer to key TRIPS provisions, they may lead states to pass laws that discourage inventors from investing or licensing technology in those states. An example of such a key TRIPS provision is Article 31(c), which states “and in the case of semiconductor technology shall only be for public non-commercial use or to remedy a practice determined after judicial or administrative process to be anticompetitive.”
The attached comments provide more detailed information regarding our position. For additional information please contact SIA Vice President for Public Policy Daryl Hatano at firstname.lastname@example.org
COMMENTS OF THE SEMICONDUCTOR
INDUSTRY ASSOCIATION (SIA)
September 29, 2003
The Semiconductor Industry Association (“SIA”) of the United States welcomes the opportunity to submit comments pursuant to the open invitation to civil society in countries participating in the Free Trade of the Americas (‘FTAA”) negotiations. The SIA is the leading voice for the U.S. semiconductor industry and has represented American-headquartered manufacturers since 1977. SIA member companies comprise approximately 85% of U.S.-based semiconductor production. Our member companies have global manufacturing and distribution. Our comments on the Chapter on Intellectual Property Rights are as follows:
Part I _General Provisions and Basic Principles
Article 3 - General Principles
3.2 - This paragraph is ambiguous and could allow a Party to disregard or fail to enforce legitimate intellectual property (“IP”) rights. What does it mean to “abuse” intellectual property rights? Moreover, under this paragraph, the legitimate assertion of IP rights could be considered to “unjustifiably limit trade” or “prejudice local industry.”
Article 4 - Exhaustion of Rights
Delete provision and/or make it consistent with Article 6 of TRIPS. Otherwise, a Party could significantly undermine the value of IP rights.
Article 5 - Relationship to other Intellectual Property Agreements
5.2 - It would be much easier to simply note that each Party must give effect to all other IP agreements to which it is a party. We should not carve out specific provisions of each relevant agreement from this obligation. These other agreements serve as a floor or minimum level of protection, so the words “at a minimum” should be kept.
5.3 - Definitely keep this paragraph, preferably the second alternative.
5.5 - Either delete the provision or support only the statement that the FTAA provisions will not be interpreted as a reduction in the level of protection granted by TRIPS.
Article 9 - Technology Transfer
This is a troublesome article because some of the language goes beyond TRIPS, would create ambiguity, and could force technology transfer in a manner that would undermine the protection and enforcement of IP rights.
9.1 - FTAA Paragraph 9.1 should be amended to reflect TRIPS Article 7.
9.2 - The language in the first alternative is problematic because it would allow Parties to use regulation to transfer technology without carving out IP rights. FTAA Article 2, which is similar to TRIPS Article 66, should be sufficient to remind Parties that recognition and enforcement of traditional IP rights is the best way for increased transfer of technology to developing countries.
9.3, 9.4 & 9.8 - Again, the language in these paragraphs could be used to undermine legitimate IP rights. The language could be made acceptable if it was clear that any legislative and other measures taken to either encourage and facilitate technology transfer or prohibit contractual restrictions on same cannot interfere with the granting, exercise or enforcement of IP rights existing under this or other applicable IP agreements.
Article 10 - Exercise of Rights
Make this article consistent with Articles 8 and 40 of TRIPS so as to clarify that any restrictions on the exercise of IP rights to protect public health, etc. and prevent the abusive exercise of IP rights “must be consistent with other provisions in the FTAA.”
Part II -- Section 1 (Trademarks)
Article 1 - SIA would object to a requirement that the signs be visually perceptible on the goods since some marks on semiconductors may not be visually perceptible to the naked eye. SIA does not object to a requirement that the sign be visually perceptible on the registration itself so long as it is clear that the sign can be smaller when fixed on the good.
Part II -- Section 3 (Copyrights)
Article 11. There should be an explicit prohibition on levies on digital equipment and media included as either a limitation under Article 11 or as a new article. The FTAA should prohibit FTAA countries from imposing mandatory copyright levies on digital equipment and blank digital recording media because it is harmful to consumer interests. SIA has strongly supported the elimination of semiconductor tariffs into the U.S. and overseas markets in order to lower the costs of semiconductors and thereby making it more affordable to consumers. Levies on digital technologies and media (such as personal computers and flash memory cards) would undo decades of work to allow consumers to benefit from technology by decreasing the costs of information technology.
Part II - Section 5 (Patents)
Article 2 - Exceptions to Patentability
For exceptions to patentability, we prefer either the first alternative under Paragraph 2.1 or Paragraph 2.2.
Article 3 - Rights Conferred
Paragraph 3.1 is sufficient because it harmonizes TRIPS with FTAA concerning this issue.
Article 4 - Exceptions to Rights Conferred
Either alternative under Paragraph 4.1 is fine because it is consistent with TRIPS. Paragraphs 4.2 to 4.4 go beyond TRIPS and would in certain circumstances inappropriately restrict patent rights conferred on the inventor.
Article 5 - Other Use Without Authorization of the Right Holder
5.1 - The first alternative of Paragraph 5.1 should stay as is, as it limits compulsory licensing to those limited circumstances described in Article 31 of TRIPS. The other alternatives are unacceptable because they ignore one or more of the TRIPS protections in compulsory licensing situations such as Article 31(c), which states “and in the case of semiconductor technology shall only be for public non-commercial use or to remedy a practice determined after judicial or administrative process to be anticompetitive.”
5.2 - This paragraph should be deleted because it vests too much authority in a Party to take legislative measures that grant compulsory licenses whenever there is an “abuse” (undefined) of patent rights.
5.3 - This paragraph should be deleted.
5.4 - This paragraph must be deleted.
5.5 - “national emergency” needs to be defined by providing those examples and stating that similar epidemics also would fit the definition.
Article 6 - Exhaustion of Rights
Delete Paragraph 6.1 (all alternatives) and/or make them and Paragraph 6.2 consistent with Article 6 of TRIPS.
Article 8 - Term of Protection
We support Paragraph 8.2, which extends the 20 year term of protection to compensate for unreasonable delays that occur in the granting of a patent.
Article 10 - Procedural Issues
These paragraphs are useful to ensure an orderly, transparent and fair patent prosecution system.
Part II - Section 8 (Industrial Designs)
Article 5 (exhaustion of rights) should be deleted.
Part II - Section 10 (Undisclosed Information
Paragraph 1.3 should be deleted. Trade secrets should not have to be in writing to ensure their protection, as long as it can be proven that such information existed and reasonable steps were taken to protect the information.
Part II - Section 11 (Unfair Competition)
Paragraph 1.2 in particular is vague and needs to be clarified or deleted. For example, 1.2(a) would classify any act in relation to industrial property that is contrary to “honest practices and usage,” which terms are not specifically defined. As an example, the paragraph would include any act to create confusion by any means with the goods, services, etc. of a competitor as being “unfair competition.” How does a Party measure “confusion”?
Part II - Section 12 (Control of Anti-Competitive Practices in Contractual Licenses)
The FTAA would defer to Article 40 of TRIPS for how to control anti-competitive practices in contractual licenses.
Part III - Enforcement
Article 1 - General Obligations
1.4 - The first alternative to Paragraph 1.4 is good, but the word “preferably” should be removed so that all judicial and administrative enforcement proceedings regarding IP rights are in writing. Delete the second alternative.
Article 2 - Procedural and Remedial Aspects of Civil and Administrative Procedures
2.3 - Although consistent with TRIPS Article 43(1), subsection (a) of the first alternative of FTAA paragraph 2.3 raises serious concerns and should be deleted or narrowed down substantially in its reach, as it would allow a Party’s judicial authority to compel the production of confidential information held by one entity to its competitor who allegedly needs that evidence to support its claims. As with TRIPS Article 43(1), the paragraph dictates that measures be taken in certain cases to protect the confidential information; however, once that information is in the hands of a competitor it has lost its value. It is common for competitors who are not doing well to trump up charges against a more dominant player, and if this provision were abused, it could create serious injury to those who are conducting legitimate business.
However, we support the second alternative, as it allows an injured party to recover profits “attributable to the infringement” that are in addition to actual damages.
2.6 - Paragraphs (a) and (b) of the first alternative, if kept, should be clarified so that the authority judicial authorities have to “dispose” of infringing materials and goods outside the channels of commerce includes a strong preference (or better yet, mandate) to destroy such materials and goods. Same edits should be made to the second alternative.
Article 4 - Criminal Procedures
4.1 - Criminal procedures and penalties should be applied in cases involving wilful infringement of patent rights, not just cases of wilful trademark counterfeiting or infringement of copyrights. The ability to impose criminal penalties in patent infringement cases is key to deterring such behaviour.
|countries||sitemap||a-z list||governmental contact points|