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TPPA: Who cares about Intellectual Property?

Paul Matthews, NZCS CEO. 10 December 2010, 2:15 pm
TPPA: Who cares about Intellectual Property?

It's been a fascinating time recently on the Intellectual Property front.

As well as proposed changes to the Copyright Act being overridden by no less than Prime Minister John Key himself, New Zealand has gone on to take a world-leading stance on software patents and we've been at the forefront of ACTA discussions.

In the last few days things have taken another interesting turn with the leak of a confidential paper from New Zealand officials involved in the current TPPA Free Trade Agreement. The significance of what this paper contains certainly seems to have been somewhat missed by many, perhaps overshadowed by the still unfolding Wikileaks drama.

Intellectual Property and Free Trade Agreements

Free Trade Agreements are about... trade, are they not? So what does Intellectual Property have to do with trade?

Quite a bit it would seem.

The fact is, the job of trade agreement negotiators is to create an environment where their country, and the industries in their country, flourish. There’s nothing wrong with that – that’s one of the important roles of Governments. However as with all good agreements of any type, the trick is to end up with a win-win position.

Many Free Trade Agreement negotiations involving the USA (and some others) include provisions tightening up IP around “generic” pharmaceuticals. These effectively attempt to restrict medicine availability to name brands or those licensed, with the obvious positive flow-on to far more expensive "name brand" pharmaceutical companies. There are other areas where IP comes into the equation. An important area for New Zealand is in the ICT space around software patents for example. Patents are effectively a state-granted monopoly to exploit a concept for a certain amount of time.

Given the US (and some other countries) is the home of some of the larger and more “established” software producers, some would certainly argue that the patent regime significantly benefits these markets over emerging and developing ICT sectors such as in New Zealand, hence the reason some countries seek to apply pressure to tighten the IP regimes in other countries.

In New Zealand's case, it would be hard to believe that our Government's decision to exclude software from patentability isn't under pressure.


The Trans-Pacific Partnership Agreement (TPPA) is a proposed Free Trade Agreement (FTA) that builds on an existing FTA between New Zealand, Chile, Singapore and Brunei Darussalam but also now includes United States, Australia, Peru and Vietnam.

If successful it will be potentially hugely important to New Zealand’s trade future.

The next round of negotiations began in earnest in New Zealand this week, as it happens, and was foreshadowed by the leaking of a position paper prepared by New Zealand for the other countries negotiating. What this paper contained was somewhat remarkable.

The New Zealand IP paper

The US-based Public Citizen group obtained and leaked a copy of the confidential New Zealand paper addressing IP, and some of the content is fascinating.

For example:

Analysis of the costs and benefits of IP protection shows that there is a tendency towards overprotection of IP in all our societies, particularly in the areas of copyright and patents. The analysis also shows that the optimal rate of protection differs between countries and that it can differ across time as countries move through different stages of economic development.

The problems of overprotection are particularly acute for technology importing countries, including developing countries. The analysis shows that for these countries, IP rights that are too strong will detract from innovation rather than promote it. TRIPS, therefore, includes important flexibilities which are important for technology importing countries as they seek to use IP as a development tool. These flexibilities are designed to allow technology importing countries to make the same transitions that technology exporting countries made to become knowledge rich economies (i.e. technology exporting countries have in most cases evolved from being technology importing countries and these same countries pursued quite different IP policies in those circumstances.) FTAs and other agreements that seek to limit such flexibilities simply act against the interests of technology importing countries.

You can read the whole paper here, or a reasonably heavy analysis of it here.

Reading that kind of language from our country’s negotiators makes me mighty proud to be a kiwi. As with the changes to the Patents Act earlier in the year, it’s New Zealand leading the way on this. The issue is, of course, that this was New Zealand's position at the start - is it still our position now?

New Zealand's stance on IP is, in many cases, outstanding. And don’t underestimate the fact that the rest of the world is watching on this. As an example, a few months ago NZCS blogged the news about New Zealand’s removal of software patents. According to this was read by over a million people globally and it really was humbling reading the tweets from around the world - thousands of tweeters ecstatic to discover a government willing to step up and do what’s right for their country, regardless of the pressure no doubt applied by others.

So, who cares about Intellectual Property?

Well I certainly do, and you should too. IP is absolutely essential to protect the work of creators, however always needs to be balanced with the rights of others and that's where the problems come in. If we want the ICT sector to flourish in New Zealand, we need an environment where people can innovate unimpeded by a regime designed to protect the status quo.

So on that backdrop it's great to see a proactive stance from our Government on this - well done I say.

Paul Matthews is Chief Executive of the New Zealand Computer Society (NZCS).



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