This page contains the justifications for all FFII [ffii:action:ipred2/Plenary1_Tabled_Amendments voting recommendations] for the first reading of IPRED2.

Legislative Proposal

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Am 43=44

The scope of this directive has serious defects as regards legal base. Therefore it should be rejected. It has been questioned by the Dutch parliament; "both Houses of the Nederland States-General conclude that no power has been granted to the Community in respect of the aim of the proposed action. Nonetheless, both Houses have – for the record – scrutinised the present proposal by reference to the principles of subsidiary and proportionality and concluded that the proposal does not comply with them", and also the UK government claims in a letter from the UK permanent representation to all UK MEPs that the "EC competence does not extend to the proposals and that the case for the need for the Directive has not been sufficiently made out".

The European Court of Justice’s ruling in case C-176/03 Commission v Council states that measures adopted under the first pillar are not prevented from requiring criminal sanctions where these are the only effective remedy. Further, the Commission has never provided any evidence that the existing national civil and penal rules are inadequate and do not provide enough tools to fight against the violation of intellectual property rights.

The directive is superficial, it disregards the fact the underlying substantive law is not harmonised and that national law systems differ considerably. Carefully balanced national procedural law systems will be distorted. Above all, the directive is unmotivated and unneeded: the legal means to combat piracy and counterfeiting are already available. The best option, in our opinion, is to reject the directive.

Article 1

Commission

Am 8

Amendment 8 does not specify the precise rights to which the directive applies. It does not conform with the ECJ verdict C-176/03 as well as lets the directive apply to non-harmonised rights. Amendment 8 in itself does not limit anything and includes several unexamined (and therefore often invalid) rights such as database rights (only valid if "substantial investment"), design rights and utility model rights (also called "petty patents").

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Am 45=63

Apart from other possible considerations, ECJ C-176/03 does not leave room to go further than Community law. The Commission’s justification shows only examples of copyright piracy and trade mark counterfeiting. The scope has to be limited to these two issues. This is in conformity with the TRIPS treaty.

Commission

Am 9

Almost all arguments for taking out patents are valid for all IPRs, e.g. limiting risk for legit business activity. While taking out patens is essential, it is not enough (see amendment 45=63)

Am 10

Almost all arguments for taking out patents are valid for all IPRs, e.g. limiting risk for legit business activity. While taking out patens is essential, it is not enough (see amendment 45=63)

Am 11

Amendment 11 excludes a number of IPR's which for whose inclusion the Commission provides no explanation, and where commercial scale infringement is often of a non-criminal nature. However, there is no indication why other rights such as database, utility model or plant variety rights should remain included in the scope.

Regarding the second half of the amendment it can be said that parallel importation cannot be considered as piracy or counterfeiting in such cases a genuine product is sold with the consent of the right holder. Amendment 15 is better though, since parallel importation most often does not involve a third country.

Article 2

Commission

Am 12

Much ado... but it's probably a correction.

Commission

Am 13

• The Commission has not presented a single justification for including any other action than the TRIPs-defined copyright piracy and trademark counterfeiting. Last year the Commission even published a report which concluded that no beneficial effect of the database rights directive could be demonstrated, let alone the need for criminalising infringements thereupon.

• The definition of "commercial scale" in combination with the scope includes several business acts which are not necessarily criminal in nature. In all of the following cases the final verdict was "no infringement", but if the accused had risked criminal penalties they might not have even started their business activities. Moreover, even if there had been an infringement none of the cases below pertain to criminal organisations or activities, although they would fulfill all requirements of this directive in the Commission's and Mr Zingaretti's version:

  • Trademarks and trade names, e.g. Hasbro v. Clue Computing -- Starbucks v. STARPREYA -- Gerolsteiner Brunnen v. Putsch

  • Copyright, e.g. Lewis Perdue v. Dan Brown (The Da Vinci Code) -- Jennifer Armour v. Beyoncé -- YachtWorld v Nautical Solutions Marketing Inc

  • Database right, e.g. the British Horseracing Board v. William Hill -- Électre v. T.I. Communication and Maxotex, Groupe Moniteur and others v. Observatoire des Marchés Publics, ...

• Article 2(1)(a) and (b) of Council Regulation (EC) No 1383/2003 of 22 July 2003 includes 'counterfeit goods' and 'pirated goods'; but does not include goods covered by patents, supplementary protection certificates, national plant variety rights, designations of origin or geographical indications, and geographical designations, all of which fall under clause 2(1)(c) of the Regulation.

• Additionally, the definition of "commercial scale" does include most IPR-infringements by private persons for non-criminal purposes, since those private persons most likely obtain an indirect or even direct economic advantage by doing so (by e.g. spending less money).

• The definition of "intentional" does not limit anything and is circular. If one replaces "commercial scale" with its definition from the previous paragraph, the result is "... for the purpose of obtaining an economic advantage to obtain a direct or indirect economic or commercial advantage"

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Am 39=59

We hope the paragraphs a), b) and c) of this and other amendments to article 2 will be voted separately so that the European parliament can choose where it wants to draw the line for a) which IPRs it want to include, b) where to draw the line for what is commercial scale and how to exclude private persons and c) what exactly is required for an infringement to be intentional. The standards set in this amendment does not secure libraries, consumers and innovators from being criminalised.

Am 30

This Amendments by Bowles aims at keeping "commercial scale" and "intentional infringements" undefined.

Contrary to Bowles' justification, it is not true that a restrictive definition of the above concepts would result in a conflict with the TRIPS treaty. It is an extra, the directive may have stronger measures than the TRIPS treaty. More restrictive definitions are justified in this case. The directive does not undo the TRIPS treaty. It is normal that criminal law has more restrictive definitions than civil law.

Can Member States make their own definitions if conditions are undefined? Yes they can. But they face a serious a risk. Commercial scale comes from the TRIPS treaty (WTO). By referencing the TRIPS treaty, the Community risks their definitions being written by other organisations (WTO, WIPO). And since it's Community law, the European Court of Justice (ECJ) may ultimately decide. It's a King Lear situation: if you don't take control yourself, others will do it. The music industry will try to influence the definitions in other fora, outside reach of the European Parliament. And we do not know in which direction the uncertainty will be interpreted by national courts (at first instance, before a possible ruling of the ECJ).

It is the first time the Community can make criminal law. And already it plans to outsource aspects by creating a Carte Blanche Criminal Law.

We already have the TRIPS treaty that obliges the Member States to take action against copyright piracy and trademark counterfeiting. The Member States have their owns laws as an extra to that. The IPRED1 directive (the civil sanctions directive) contains strong civil measures. Community criminal law is not needed at all, and only creates loopholes - which is the opposite of subsidiarity.

Whoever cares about subsidiarity cares about proportionality, and should not leave concepts undefined but reject the directive altogether. If that fails, strong definitions are needed. The stronger, the better Europeans are protected, the higher the chance the member states do not have to change their national laws.

Am 46

The standards set in this amendment does secure libraries, consumers and innovators from being criminalised.

Regarding the difference between "maliciousness" and "bad faith", imagine a library wishes to launch a new service. Publishers or authors challenge the library's right to offer the new service, alleging that it would infringe copyright. Legal expert opinion obtained by the library says that it would not. If the library goes ahead, believing in its right to offer the service, it is potentially a deliberate infringement. Thus it is potentially a crime and the library probably would not dare to do it. But if the crime is restricted to malicious or bad faith infringements, the library has less to fear because it is not attempting piracy but hoping to assert its right to offer a service. It might have to fight out a civil case, but that possibility puts less of a block on the development than the threat of criminal prosecution.

Am 38

The second part is nonsense, criminalising some forms of parallel import.

This amendment should be merged with the JURI amendments 11 and 15 on parallel importing so it reads:

• In particular, this Directive does not apply to any infringement of an intellectual property right related to:
  - patent rights, utility models and plant variety rights, including rights derived from supplementary protection certificates;
  - parallel importation of original goods which have been marketed with the agreement of the right-holder in a country outside the European Union.

"in a country outside the European Union" is better than "in a third country", normally no third country is involved. Just the country where the product is marketed and the EU are involved.

Article 3

Commission

Aiding and abetting criminal offences like murder is part of the criminal law of many Member States. It is a common criminal law concept - likewise attempt - which usually means having the relevant criminal intent to do the crime (the "mens rea") but being stopped from completing the relevant physical act.

While aiding, abetting and attempt are not crimes in themselves, their application to IP infringement would probably be in most Member States. They are what is called "ancillary" provisions. Criminal lawyers are usually talking about aiding and abetting a robbery, or murder or other "criminal act".

"Inciting" is not a standard criminal law concept. It may be a crime in certain specific contexts in some national speech laws - e.g. inciting hatred crimes, in countries which have those sort of laws (like France and Germany). However as of today few, if any, Member States has "inciting IP infringement" as a crime in their national law.

Am 31

National law systems have their own general systems dealing with for "attempting, aiding or abetting and inciting". The Community does not have the right to harmonise these systems, not even after C-176/03. Harmonisation on a directive by directive basis will create different rules for aiding/abetting/... depending on the crime committed. The end result will be more fragmented than the current situation.

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Am 50=64

Am 14

Am 15

In such cases where a genuine product, made by the right holder or with his consent, is sold. This cannot be considered as piracy or counterfeiting.

Am 51

Am 16

Am 52

Am 53

Article 4

Commission

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Am 54=60

Am 41

Commission

Am 17

Commission

Am 18

Am 19

Article 5

Commission

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Am 55=65

Am 20

A note on amendment 20:
Article 3(5) of Directive 2005/60/EC specifies that:

"serious crimes" means, at least
(a) acts as defined in Articles 1 to 4 of Framework Decision 2002/475/JHA;
(b) any of the offences defined in Article 3(1)(a) of the 1988 United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances;
(c) the activities of criminal organisations as defined in Article 1 of Council Joint Action 98/733/JHA of 21 December 1998 on making it a criminal offence to participate in a criminal organisation in the Member States of the European Union;
(d) fraud, at least serious, as defined in Article 1(1) and Article 2 of the Convention on the Protection of the European Communities' Financial Interests;
(e) corruption;
(f) all offences which are punishable by deprivation of liberty or a detention order for a maximum of more than one year or, as regards those States which have a minimum threshold for offences in their legal system, all offences punishable by deprivation of liberty or a detention order for a minimum of more than six months.

Commission

Am 21

Am 22

Across border criminalisation. It may not be a crime in one's own country (or not prosecuted) and yet, once on a little vacation one faces criminal prosecution.

Article 6

Commission

Am 23

Am 61

Am 24

Am 56

Am 25

Article 7

Note that in this article "joint investigation teams" means teams jointly made up of law-enforcement officers from more than one EU member state. It does not describe joint state/private teams.

Commission

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Am 57=62

Am 32

Amendment 32 removes "referred to in Article 3." So rights holders (anyone who ever wrote a letter or whatever) have to cooperate with the police on whatever subject? Cooperation with joint investigation teams should be left to the member states.

Am 26

How must the Member States ensure right holders will cooperate? Will it become a crime if a rights holder does not want to enforce his rights?

Am 27

Am 28

Am 29

Article 8

Commission

Am 58

Recital 5

Commission

Am 1

Am 34

Recital 6

Am 2

Recital 7

Am 33

Still lots of legal uncertainty. Weak rights shouldn't be under the scope, infringing item, commercial scale and intention have to be defined. Could be improved by ensuring persons accused of committing the offences did not have deliberate, conscious and malicious intent (see amendment 46).

Recital 8

Commission

Am 35

Am 37

Am 3

Recital 9

Am 4

Recital 10

Commission

Am 5

Am 6

Recital 12

Am 7

Directive 98/84/EC does not protect "intellectual property rights"; it is inappropriate to entangle conditional access regulation with copyright and trademark regulation.

Conditional access regulations are separate from, and do not take into account important dimensions of, intellectual property policy -- including both the public domain and limitations and exceptions to exclusive rights.

Furthermore, there are likely to be platform control/competition policy implications from the expansion of conditional access regimes, which require separate scrutiny and therefore make the issue inappropriate from inclusion with IPRED2.

Explanatory comment: In general conditional access refers to pay TV, although it refers mainly to the kind of pay TV where everyone in a particular "footprint", or satellite signal reception area, receives the same signal and then subscribers rent devices and/or information that allow them to decrypt particular programming.

Many of the existing laws about conditional access are already pretty disturbing, both in the EU and in the U.S.

One problem is that conditional access service operators (pay TV operators) often do licensing deals in which they make TV equipment manufacturers (like TiVo, or Panasonic, or Samsung, or Microsoft) promise to implement Digital Rights Management (DRM) restrictions in all the equipment. These restrictions are there to make the movie studios or sports organizations happy. In this sense the secrecy and proprietary nature of the conditional access security system can be used as a "hook" to get DRM restrictions added to things that might otherwise not have them.

We are quite anxious about conditional access operators get any new legal protection since they already have too much. But they are quite conceptually strange; the existing anti-circumvention laws (the "technical protection measures" in EUCD) that give them the right to control devices and technology capable of receiving their signal are sort of like a copyright-style subsidy to prop up their business model.