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Joint Standing Committee on Treaties
Trans-Pacific Partnership Agreement

WEATHERALL, Associate Professor Kimberlee Gai, Private capacity

Committee met at 09 : 03

Evidence was taken via teleconference

CHAIR ( Mr Robert ): The committee will now take evidence on the Trans Pacific Partnership. I welcome Associate Professor Kimberlee Weatherall by teleconference. Although the committee does not require you to give evidence under oath, I should advise you that this hearing is a legal proceeding of the parliament and therefore has the same standing as proceedings of the respective houses. The giving of false or misleading evidence is a serious matter and may be regarded as a contempt of parliament. The evidence given today will be recorded by Hansard and attracts parliamentary privilege. I now invite you to make a brief opening statement.

Prof. Weatherall : Thank you for the opportunity to appear. I am an expert in intellectual property law, with a particular specialty in international intellectual property law. The IP chapter of the TPP is controversial with good reason. It promises relatively few benefits for Australian creative or innovative business; it locks in what I would consider 20th century IP standards that we know have problems; it cements in place copyright rules written in the 1990s, before we had Google let alone any of the multitude of other digital services we have seen recently; and it locks in patent laws that have been identified as costing real money to the Australian health system and that have been criticised by the UN High Level Panel on Access to Medicines as imperilling the basic health needs of many people. It is complex, it is unclear, it is outdated and it is deeply unbalanced. It sets Australia up badly for the future. It has a provision on trade secrets which is both incomprehensible and deeply troubling—at a time when Australian corporate responsibility is an important topic of public debate and when we have not even begun to have a democratic debate about what trade secrets laws should look like.

I cannot quite believe I am here saying this again. This committee should be concerned that criticisms made by JSCOT and by other parliamentary committees of the IP chapters of almost every trade agreement since our 2004 agreement with the US appear to be having little effective impact on what Australian negotiators sign up for or even push for. I would like to see this committee demand a dialogue on what Australia's international IP policy should be and what we should be signing up to, especially since we are in the midst of other negotiations such as those for the Regional Comprehensive Economic Partnership. I think this committee should demand, at the very least, that the government take seriously its commitment in the TPP, and in the national interest analysis of that agreement, to pursue balanced IP laws.

This should include taking the opportunity, if we do ratify the TPP and bring it into force, to fix some existing problems with the balance in our laws, including adopting the Australian Law Reform Commission's recommendation to introduce 'fair use'; rewriting our anticircumvention laws—as the TPP allows—so that anticopy protections do not prevent schools and libraries from fulfilling their missions; and introducing and passing the Copyright Amendment (Disability and Other Access Measures) Bill so that we finally get the online safe harbours we were meant to get a decade ago and that are required by the TPP. We have a chance to fix up some problems. Despite the fact that I am not a big fan of chapter 18, it could provide an opportunity to fix some problems—and I hope that we will at least do that.

Mr JOSH WILSON: I have read through your submission and I note that it goes into more detail on some of the points you have just covered. For those of us who do not spend all day, every day, in the world of intellectual property, can you expand a bit? You refer to the system as being 'deeply unbalanced' and give us a sense of the consequence of not getting this right. But could you perhaps talk about some of the practical impacts—the sorts of things that might flow in the real world from this kind of agreement?

Prof. Weatherall : That is a fair question, but it is less straightforward than it should be to answer—because there are relatively few things in this particular chapter that would make us change our laws now. We have already agreed to some very high IP standards. The real practical impact of this chapter for Australia is that every time, from now on, that we want to have a debate about whether our patent laws are working; about whether the links between patents and pharmaceuticals are causing delays in the entry of generic medicines, costing the health system; or whether there should be other exceptions in copyright law—there is a lot in this chapter that will prevent us from having that debate. For example, we cannot talk about whether copyright terms should be shorter than life plus 70 years, and we cannot talk about whether we have patent term extensions in the context of pharmaceuticals—because those rules are all locked in, because this is such a detailed agreement.

When you have really strong—overly strong—and overly long IP laws, you are preventing further innovation, you are increasing costs to the health system for drugs and you are increasing costs for schools and libraries to get access to copyright material. We need to be constantly having a debate about how innovation policy can be done better, how changes in technology mean that we should change our laws. Those debates either are not going to happen or are going to be much harder to have.

Mr JOSH WILSON: We have heard from other people appearing before the committee about the process by which these agreements are negotiated. I guess there is a recurrent theme that by the time members of the public—even expert members like yourself—get to see where the negotiations have got to it is a long way down the path. Do you have some suggestions in terms of how experts or relevant bodies in Australia might be engaged earlier in the process so that there is more of that visibility and consultation and input before we get to the point we have reached?

Prof. Weatherall : Firstly, I would agree with what you have heard from other people. I think the process has been deeply unsatisfactory. It is a problem that we do not get to see the text or the process until very late in the piece. In terms of better ways to do this, I think there are a range of different ways to do it. One thing that I think is worth considering is if you are going to be negotiating chapters within a trade agreement that relate to domestic policy settings—the IP chapter would be an example of that—then the approach that says, 'Oh, no, we have to keep all of this secret because we can't tip our hand because this is a trade negotiation' perhaps just does not apply to those chapters. So you could have differential levels of transparency. I can see why a country might say, 'I don't want to reveal the sorts of deals I am considering making on, say, tariff reduction', but I think that if you are going to negotiate standards that are like the standards that we negotiate in multilateral treaties in IP then that chapter should be made transparent. We could have a debate about those standards because that is not something where the rules about secrecy in trade agreements even make sense.

Another way that we could think about this is to have a discussion about what our goals are in international IP policy outside a specific agreement or a specific negotiation. If DFAT were to coordinate some expert groups and potentially have a discussion about what our direction should be and what our goal should be, whether it be model text or model principles that they could go into other negotiations with, that might help. It is probably the exigencies of having multiple trade negotiations going on at once, but DFAT have not really been open to having that discussion even in the context of, say, the Productivity Commission inquiry a few years ago. That would be a possibility. Another possibility to look at is what has been going on in Europe around some of Europe's negotiations, where the European Commission has come out with relatively detailed statements of what it is negotiating around in areas like investor-state dispute settlement and in intellectual property, particularly in the context of Europe's negotiations on the TTIP—much more detailed statements about what is being considered and what is being negotiated than anything we have ever seen come out of the Department of Foreign Affairs and Trade here in Australia.

There are a range of ways that you could think about this. We can think about transparency and openness of negotiation differently for different kinds of chapters, particularly focusing on more transparency where you were talking about setting specific domestic policies.

Ms MARINO: Thank you for your submission. One of the things that I would like to know is that with your experience, do you see any benefits to IP at all in chapter 18? And a second question is: you referred to the European Union intellectual property office and their Unified Patent Court. I wonder if you would expand on both of those, please?

Prof. Weatherall : Sure. Do I see any benefits to the chapter? I would say that I do not see there would be any specific benefits for Australian creative or innovative businesses arising from this chapter. I do not think we are going to see businesses suddenly having more opportunities for innovation.

As a chapter, I guess it has some improvements on what we have seen in some previous trade agreements. I do talk about that in my submission, on page 10, under heading 3, where I say that in essence Australia-US Free Trade Agreement was a particularly bad and unbalanced IP chapter, with particularly prescriptive rules. What we see in the context of the Trans-Pacific Partnership chapter is that with more parties negotiating in the room and perhaps with more experience over the last decade that there is a bit more flexibility and that there are few more provisions that talk about interests other than the interests of rights holders. So we have some principles in favour of balance—we have article 18.66 on balance in the copyright system. We have obligations that enforcement be fair and equitable, and take account of proportionality. There are a few provisions that I would say have improved the text as a set of IP standards. But as a set of rules that you might hope would help create more innovative businesses, I have yet to hear anyone identify any rule that will benefit Australian businesses, whether here or overseas, or any specific benefit they would see as coming in.

In terms of the European Patent Office, I am not sure exactly what you are referring to. But I guess that what I am saying is that what we see in the IP chapter of the TPP is a really detailed prescription of what domestic IP law should look like. So, copyright owners must have rights that look like this, that last for life plus 70 years and that have these enforcement mechanisms; and patents must last for this long and can only be challenged on the following grounds et cetera. And we set some of those standards back in the WTO, in TRIPS in 1994. What trade agreements like the TPP do is to get even more details on that on domestic rules.

There seems to be this thinking that says, 'Oh well, the more similar IP law is in other countries, the easier it will be for innovative or creative businesses to sell their stuff into other countries in the region. It will be easier to sell stuff in Singapore if their law is more similar to ours.' That seems to be the kind of thinking. But it does not really work beyond a certain level. What you hear from people in practice, more often than not, when they are talking about how difficult it is to sell or expand into overseas markets, is that in the IP space it seems like it costs money to get intellectual property rights in every country. You have to go from office, to office to office to apply for rights. The rules in each office might be slightly different, so you have to redraft your patent every time you go from office to office.

None of that changes with the TPP. There is nothing in the TPP that is going to mean that it will be easier to take the patent that you applied for in Australia and then apply for it in every TPP country. What we have seen in some other jurisdictions, where they are actually seriously trying to pursue the common market idea—and I acknowledge that that is not what the TPP is doing—in countries that are really trying to address actual barriers to IP-intensive trade country to country, is that they are thinking about things like common registration systems. And the European Patent Office is an example of that.

The TPP does not do any of that and, given the range of countries we have here—Vietnam through to Singapore, Australia, New Zealand, the US and Chile—that is probably a pipedream. It is hard enough in Europe, let alone for something like the TPP. But what you learn from that is that is where the barriers are. That is where the barriers to IP related trade are. There is very little in the actual chapter 18 that addresses those sorts of costs or even the cost of trying to enforce across country. To the extent that people say, 'Oh, it will make it easier for regional business,' I just do not buy it because I do not think that being more and more prescriptive on the particular patent rules you are going to have actually addresses the real and practical problems that innovative businesses that want to expand their trade might face.

CHAIR: Were you involved in any of the consultations with chapter 18?

Prof. Weatherall : Yes, I was involved in some consultations.

CHAIR: What was your advice at that time, during that consultation process?

Prof. Weatherall : I made a number of submissions at various times analysing variously lead texts. In most cases, I was suggesting that the provisions that were being proposed should be removed or watered down.

CHAIR: In your opening statement you made the point—I will paraphrase, and if I am wrong, correct me—that you thought most of the IP protections in pretty much all of the bilateral trade agreements of the last 10 years have been reasonably ineffective.

Prof. Weatherall : That is not really what I was trying to say. What I was trying to say in my opening statement was that, since 2004, what Australia has been signing up to in terms of IP chapters in its trade agreements are chapters that are very detailed, very prescriptive, problematic for the making of innovation policy and unbalanced. I have appeared in front of this committee and a number of committees at various times and made the point that these sorts of chapters are problematic for law reform, are problematic for innovation policy and do not actually help business in real life. Some of those criticisms have been taken aboard by this committee and others. There have been questions raised about whether it makes sense to keep negotiating these very detailed and very prescriptive provisions that include, for example, copyright rules that we know make no sense. Everyone knows that copyright lasting for the life of the author plus 70 years is too long. There is not a lot we can do about it now, but it is too long. Even the Register of Copyrights in the US has said that it causes problems.

CHAIR: If everyone knows it is too long, why does everyone put it there? There seems to be a cognitive disconnect between a statement that says, 'Everyone knows it is too long' and 'It is still there'.

Prof. Weatherall : In the case of agreements like this, there are a range of US stakeholders who like a really long copyright term.

CHAIR: Are you a 'voice crying in the wilderness', to quote a biblical term, or is there a consensus of legal IP view on this in Australia?

Prof. Weatherall : If you are asking me to speak for all of IP academia or all of IP practice I am not sure that I could even begin to purport to do that.

CHAIR: I am not asking you to speak for them, but you would have done literature reviews and you would understand what the main body view of IP law is in the country.

Prof. Weatherall : Yes. Certainly amongst IP academia I have seen little or no support for the approach that we see in these trade agreements. I am aware that most of the people I would talk to certainly as experts in IP academia would be critical. I have participated in a range of public discussions where I have seen people beyond academia being quite critical of this approach.

I am not aware of many who would support the kinds of chapters that we are seeing. I see an increasing criticism internationally amongst even IP academics—and I would put myself in this camp—who think that having intellectual property law is a good thing and think it is very important to have good copyright laws, patent laws and trademark laws in order to encourage innovation, creativity and cultural expression. We are increasingly seeing that we are cementing down these details of incoherent rules and leaving no space for change, reform, flexibility and responsiveness. That is a very broad criticism amongst experts in intellectual property law.

CHAIR: Would you care to put forward a view on the premise that the industry associations—the BCA and others—have not raised issues regarding IP, yet the IP academics have? Why is there a difference in view there?

Prof. Weatherall : That is an interesting question. I cannot say I have had a discussion with the BCA about it. That is something you might need to ask them. Very few people spend a lot of time reading the text of these agreements. Frankly, at 75 pages, I do not blame them. So very few people are engaged with the detail of these sorts of chapters. The view often seems to be, 'Intellectual property is important to Australian businesses'—and that is true—'so having an IP chapter that has enforcement stuff in it and has high standards must be a good thing,' without ever really getting into the detail of whether it makes sense to have all of these rules coming in to these chapters and without really thinking about it deeply. There is an element of that.

I wrote a piece—and I can send it to the committee, if it does not already have it—in the Australian Journal of International Affairs recently where I pointed out the various times when we have had a debate about IP reform post the Australia-US free trade agreement. There might be a broad range of stakeholders who thought this sort of thing might be a good idea. But then, once they looked at the detail of the Australia-US free trade agreement, it became a problem. They could not do what they wanted. So I think people do not really engage with the detail until it becomes a problem for some reform they want and then they realise it is a bad thing. But by then it is way too late.

Mr JOSH WILSON: Very briefly, I want to try to sum up—and I will see if you agree with me—one of the chief criticisms that you have made. When Australia is still only sort of midstream in a reform process with the Productivity Commission providing some recommendations to government about IP and how that might change coming forward, is one of your harshest criticisms that agreements like this lock us into a position when that across-the-board consideration of opportunities to reform IP in Australia has not occurred? So are we essentially denying ourselves the flexibility to make reforms that, in many areas, are long overdue?

Prof. Weatherall : Yes, I think that is right. That is one of the chief problems with this kind of chapter. You have summed it up quite well there. I would add to that, though, that there are areas in the text of the TPP which would enable us to undertake some of the reforms that have already been suggested we need in Australia. For example, a couple of years ago the Australian Law Reform Commission did a very comprehensive review and said, 'We need some more flexibility in copyright law, but our exceptions have not kept up and we should introduce an open-ended fair-use style exception.' There are articles in the TPP that would allow us to do that. If we are going to go ahead and the TPP does come into force and we enact it, we have to ensure that we do not lose the opportunity to take hold of that chance to make some reforms we should make and introduce some balance that we should introduce—perhaps to pursue Productivity Commission suggestions. We can do it within the text. The worst thing to do would be to just agree to all of this and then not take the opportunity we have to reform our law and to bring in some of the positive pro-innovation and flexibility that we need.

CHAIR: Thank you for your time here today. If you have been asked to provide any additional information, would you please forward it to the secretary within the next seven days. You will be sent a copy of the transcript of your evidence and will have the opportunity to request corrections to transcription errors. I thank you for making the time and effort to spend time with us.

Prof. Weatherall : Thank you very much for the opportunity to appear.