You down with TPP? A look at the IP provisions of the Trans-Pacific Partnership

November 8, 2016

Blog Post

The Trans-Pacific Partnership (TPP) trade agreement has been a favored talking point for the presidential candidates. While most of the debate on the TPP tends to focus on its potential effects on jobs and wages for American workers, we hear little about the Intellectual Property provisions of the agreement.

The TPP Agreement is a trade agreement among 12 of the Pacific Rim countries – notably not including China – that was signed by all 12 countries on February 4, 2016, concluding seven years of negotiations that resulted in 30 dense chapters of provisions – some of which are mandatory, while others are permissive. The Agreement is currently awaiting ratification to enter into force. Despite much discourse between supporters and opponents of the TPP, most agree that the TPP Agreement is the most ambitious trade deal since the North American Free Trade Agreement (NAFTA) of the 1990s.

Image source: The New York Times

Intellectual Property Provisions

Chapter 18 of the Agreement is dedicated exclusively to intellectual property protections. These provisions provide that the “protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare.” (Article 18.2: Objectives)

Much of Chapter 18 effectively requires non-U.S. countries to align their intellectual property laws with those already in practice in the U.S. While these provisions may represent a drastic expansion of many member nations’ current laws, they appear to reflect the status quo in the U.S.

Below is a listing of some of the major IP provisions of the Agreement.

Trademark

Sound marks, scent marks, collective marks, certification marks, and geographical indications are registrable as trademarks. (Art. 18.18-18.20)
Registered trademark holders must be given an “exclusive right to prevent third parties” from using the mark or similar marks for related goods or services without consent, where such use “would result in a likelihood of confusion.” (Art. 18.20)
Permits the provision of trademark exceptions, such as fair use. Notably, this provision – codified law in the U.S. – is not required under the TPP. (Art. 18.21)
Requires provision of a system for examination and registration of trademarks, including providing “an opportunity to oppose the registration of a trademark or to seek cancellation of a trademark.” (Art. 18.23)
Requires provision of an electronic trademark application and maintenance system, including “an online database of trademark applications and of registered marks.” (Art. 18.24)
Initial terms and renewals terms can be no less than 10 years. (Art. 18.26)

Patent

Member countries must provide patent rights for inventions that are new, involve an inventive step, and are “capable of industrial application.” (Art. 18.37)
Publications and disclosures made within 12 months of the filing date by the patent applicant, or a person who obtained the information from the patent applicant, are not to be considered prior art to the patent application. This provision is particularly similar to language of the U.S. America Invents Act. (Art. 18.38)
Requires an effective first-to-file patent system, wherein the first inventor to file an application for an invention is awarded the patent. (Art. 18.42)
Requires publication of pending patent applications, as well as publicly accessible patent prosecution files. (Art. 18.44-18.45)
Requires extension of patent term for delays caused by prosecution time or, for pharmaceutical patents, marketing approval time. (Art. 18.46, 18.48)
Where safety or efficacy data must be disclosed for marketing approval, requires provision of 10 years of market exclusivity for agricultural products and five years of market exclusivity for pharmaceutical products. Notably, these market exclusivity terms are shorter than those available under U.S. law. (Art. 18.47, 18.50)
Requires certain provisions for approval of generic drugs. (Art. 18.53)

Copyright

Requires a copyright term of life of the author, plus 70 years. (Art. 18.63)
While not explicitly requiring exceptions such as fair use, the language states, “Each party shall endeavor to achieve an appropriate balance . . . giving due consideration to legitimate purposes such as, but not limited to: criticism; comment; news reporting; teaching, scholarship research, and other similar purposes; and facilitating access to published works for persons who are blind, visually impaired or otherwise disabled.” (Art. 18.66)
Requires criminal penalties for circumvention of technological protection measures if the circumvention is willful and for the purpose of commercial advantage or financial gain. Such criminal liability is irrespective of commission of copyright infringement of the underlying work. This is similar to the U.S. Digital Millennium Copyright Act. (Art. 18.68)
Requires criminal penalties for copyright infringement, including for acts that are not necessarily for financial gain or commercial advantage, but that have a “substantial prejudicial impact on the interests of the copyright or related rights holder in relation to the marketplace.” This could potentially mean an expansion of current criminal penalties under U.S. law. (Art. 18.77)
Requires a safe harbor provision for internet service providers, consistent with the U.S. Digital Millennium Copyright Act. (Art. 18.82)

Trade Secret

Requires both civil and criminal penalties for trade secrets theft. The U.S. already has criminal penalties via the Economic Espionage Act, and civil remedies in the form of state laws and the recently enacted Defend Trade Secrets Act. In many ways, the Defend Trade Secrets Act mirrors provisions of the TPP. (Art. 18.78)

Conclusion

The TPP Agreement is not yet in effect for any member countries. If ratified by all 12 nations by February 4, 2018, the agreement will become effective 60 days after the 12th nation ratifies. Otherwise, the agreement will become effective when ratified by at least six countries that account for at least 85 percent of the group’s collective Gross Domestic Product. (Art. 30.5). Although, some countries are permitted post-enactment transition periods, ranging from 18 months to 10 years, for certain IP provisions. (Art. 18.83).

McDonald Hopkins LLC is proud to announce the addition of two distinguished attorneys to its Intellectual Property Department. Sean Mellino and Jamie Pingor bring decades of experience and diverse legal knowledge in intellectual property law to the firm. Their integration into McDonald Hopkins underscores the firm’s commitment to attracting top legal talent, cementing its status as a destination firm for accomplished attorneys and discerning clients alike.

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