K.S. Park’s Speech at RightsCON 2014 Panel “Policy Laundering (through Trade Talks)”

Governments around the world are trying to attain through international treaty negotiations their policy objectives otherwise unattainable through domestic political discourse. The idea is that they make commitments in international fora and use the commitments as persuasive tools in addressing their domestic constituents. K.S. Park, Director of Open Net, spoke on March 3, at RightsCON 2014  on how cultural diversity v. trade debates end up in “internet bashing” and have the risk of turning into international commitments to internet control. For liveblog on all proceedings of RightsCON, press here.

POLICY LAUNDERING: HACKING THE INTERNATIONAL INNOVATION POLICY MACHINE
12:00-1:15, March 4, 2014

Corynne McSherry, Intellectual Property Director, EFF (Moderator)
Participants:
Kyung Sin (“K.S.”) Park, Korea University Law School Professor and a Director of Open Net Korea
Miguel Morachimo, Director of Hiperderecho
Andrew Bridges, Fenwick & West LLP
Maira Sutton, Global Policy Analyst at EFF
Harvey Anderson, Chief Legal Officer, AVG Technologies

OECD is compiling trade restrictions of all member countries in the services trade and will give each country a trade restrictiveness score (Services in Trade Restrictiveness Index or STRI). The obvious goal of this project, led by the U.S. is to put “peer pressure” on trade-restricting countries, a pressure to liberalize. Europe does not like this effort as far as it includes the audio-visual services industry which the member countries protect with various forms of broadcasting quota and other subsidies available only domestically. The US-EU fight on this issue is routinely witnessed in trade talks. However, all internet companies and users need to watch with care this free trade vs. cultural diversity debate because the Internet may become the innocent victim of this trade war.
That possibility became menacing, for instance, at an OECD experts meeting, April 2011, Paris.

What was not interesting, was that the US reps argued for more liberalization while EU reps pleaded against it with the usual data on how the U.S. cultural products dominate European domestic markets.
What was interesting, there was an issue that these two opponents in a trade-vs-culture dispute passionately agreed on: the need to control piracy and therefore the Internet. French artists angrily argue that piracy on the Internet kills cultural diversity by depriving them of the fruits of their creation. Motion Picture Association of America, of course, is asking for more stringent copyright enforcement such as Three Strikes and monitoring obligations. The ‘mutual enemies’ in a culture-vs-trade dispute, were now all joining their voices in condemning the internet companies’ or the countries’ failure to combat copyright piracy.

As the two duelists were singing the same song, the harmony became so ridiculous to a point where MPAA rep proposed to list the lack of copyright enforcement as a trade barrier! The idea is that it is difficult for American films to enter a market where copyright is not enforced, and therefore copyright enforcement is a barrier to trade. Now, this is a huge departure from the usual meaning of a trade barrier, which normally means too much regulations. Here MPAA argued, too little regulation is also a trade barrier. With that sleight of hand, now the countries around the world faced the risk of being listed as a trade-restrictive country unless they adopt 3-strikes and stronger intermediary liability regime.

There I argued in rebuttal as follows: Once lack of copyright enforcement is deemed a trade barrier, more stringent copyright enforcement measure will be considered a ‘trade liberalization.’ However, if a country adopts one of the copyright regulations such as 3-strikes and monitoring obligations on intermediaries, it will become only more difficult for foreign internet companies to enter that country’s market and it will become more difficult for foreign users to connect with domestic users.

A more extreme example will be Korea where mandatory user identification was adopted to facilitate stamping out ‘illegal content’ from the internet. Foreign internet companies, having no means to comply with the identification requirement, and therefore could not enter the Korean market, unless they do what Google heroically did in 2010, and foreign users having no means to comply, could not use Korean portals.

If we accept MPAA’s argument that lack of copyright enforcement and lack of internet control is a trade barrier, a trade liberalization in one sector (film) becomes a trade barrier in another sector (internet), which beats the whole purpose of listing trade barriers set up by each country and giving each a score.
Upon this rebuttal, the 30 or so countries’ representatives came to their senses and decided not to include lack of internet regulation as a trade barrier, but only at that meeting. I suspect that many other meetings are dressed as and start out as trade-vs-culture debates and end up turning into the internet bashing.
So, what are the lessons here?

The first and obvious one is that we should watch with care trade talks because they can easily turn into the Internet bashing. I am horrified to imagine what would have happened if OECD decided to list a lack of 3 Strikes Law as a trade barrier at that Paris meeting in April 2011.

The second: One of the mostly cited reasons for treaty negotiations is liberalization and consumer welfare. But as you saw from the debate, it is not what they want really. They just want more money for themselves. MPAA did not ask for liberalization. They wanted more regulation. MPAA did not even represent American corporate interests properly because the regulations MPAA wanted would have made it difficult for fellow American companies like Facebook and Google to enter foreign markets. We should really try to find out who is representing our countries at trade talks because they may be there just to make more money for themselves.

Lesson Three. The exact converse of Lesson Two. Don’t think that all trade negotiations are bad. Depending on who goes in there and pushes for which laws, we may get something good for people’s welfare. In 2010, our group filed a lawsuit against a Korean copyright society for requesting the takedown of the video clip of a 5-year old girl mimicking a popular singer’s song titled “I am Crazy”, and actually won that lawsuit. I know that a similar Lenz lawsuit filed by my beloved EFF folks is not going very well and also know that Prince’s song involved there is titled none other than “Let’s go Crazy”. Now, where did the Korea legislature get the idea that we can dare to sue copyrightholders? Well, from U.S. law. Now, Korea-US FTA negotiation now guaranteed the longevity of that provision. Also, this year, our group is fighting against the shut-down of the U.S.-based music site Grooveshark. Two strong arguments against shut-down came from none other than Korea-US FTA, which provided protections from copyright liability to the intermediaries as long as they consistently followed the notice-and-take-down regime for known infringing material and prohibited the partner countries from requiring the intermediaries to do more such as monitoring. Of course, these are really cures provided after diseases because it is also Korea-US FTA negotiation that introduced into Korea the whole idea of shutting down a whole site for copyright violations happening there, namely 3-strikes You are Out. This leads to really the theme of this panel: transparency of trade negotiations. The point is not to oppose trade negotiations but figure out which ones are bad and need be opposed.