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Posts Tagged ‘TPP’
December 11th, 2015 at 3:36 pm
Beware of Misinformation and Deceptive Tactics by Free Trade and Intellectual Property Opponents
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CFIF steadfastly supports both free trade and strong intellectual property (IP) protections.  Each has played an invaluable role in making America the most innovative and prosperous nation in human history, and each is important if we hope to maintain that primacy through the 21st century.

In that spirit, we hope to ultimately support the Trans Pacific Partnership (TPP) after our own reasoned analysis.

Even the cleanest trade agreements tend to be complex,  and the TPP is no exception.  Along with so many other conservative and libertarian organizations, we are therefore carefully examining the TPP’s provisions in determining whether to ultimately support the agreement.

Making that determination in an intelligent and good faith manner, however, requires that the debate remain grounded in accurate, reliable and pertinent information.  But opponents of free trade and strong IP protections have undertaken a campaign to confuse and frighten the electorate through distortion.

An organization named IP Watch offers a perfect example of such tactics, with a recent piece about the TPP’s dispute resolution provisions known as the Investor State Dispute Settlement (ISDS) process.  IP Watch contends that, by virtue of the ISDS, “foreign corporations [will have] a huge advantage in IP disputes – private arbitrations that can override courts and statutes, effectively rewriting a nation’s IP laws,” but the simple reality is that ISDS provisions are common to international agreements and unremarkable.

Simply put, an ISDS process allows companies doing business abroad to protect themselves against unfair treatment such as discrimination and government seizure of their property, known as “expropriation.”  Over 3,000 international agreements include a process to resolve these problems, but many stubborn opponents of free trade and IP rights oppose these dispute resolution mechanisms, which are designed to give American companies similar protections to those enjoyed by foreign companies doing business in the U.S.

For its part, the TPP includes countries around the Pacific Rim, collectively  accounting for about 40% of all global trade, and like the 3,000 other international agreements referenced above, it includes an ISDS process to level the playing field for American companies doing business overseas.   Additionally, like so many other previous trade agreements, the TPP broadly exempts IP from the ISDS process unless the IP was expropriated and the expropriation violates the IP provisions of either the TPP or the World Trade Organization (WTO).

Those opposed to free trade or strong IP rights, however, don’t like the idea that companies possess that option to protect themselves, particularly companies that rely on IP protections.   Their attack on the ISDS process as it applies to IP is an opportunistic and cynical attempt to achieve their larger aim, the erosion of IP protections for creators and innovators.

Further, in practice it’s not easy to win an ISDS case.  First, an investor must prove that there was either direct expropriation (the government forcibly comes in and seizes the property, claiming now to be the legal owner of it), or indirect expropriation (the same effect as direct expropriation but without the outright seizure).  That is drawn from U.S. law, and the U.S. Constitution itself,  per the Fifth Amendment provision that, “nor shall private property be taken for public use, without just compensation.”  Moreover, the particular standards in the TPP for proving whether there has been an “expropriation” (e.g., “taking”) are drawn directly from a Supreme Court ruling on the Fifth Amendment in Penn Central Transportation Co. v. New York City (1978).

Accordingly, it should alarm readers of IP Watch that the anti-trade, anti-IP crowd has thus gone so far as to malign concepts contained in the Bill of Rights itself.

In addition to demonstrating an expropriation of IP rights, the TPP requires a company to prove that the government action violated the IP provisions of either the TPP or the WTO.  And those rules are the product of agreement by the governments of nations of all perspectives from across the globe, and constitute the basic levels of protection for IP.

That’s why companies bring so few cases.  Tellingly, only 13 cases have ever been brought to conclusion against the United States, and we won all of them.

There’s another factor that must be considered as well.  Namely, if you are an American company doing business abroad, where you rely on the local authorities for police protection and hope for fair treatment by the government and judges, how eager would you be to start a lawsuit against the whole country?  You, your board of directors and your shareholders would think long and hard about that one.

The ISDS process is a fair and appropriate one, but realistically, companies are only going to resort to it when their backs are truly against the wall.

Anti-trade and anti-IP interest groups and advocates will likely continue to publish misinformation about the TPP and its IP chapter in an attempt to scuttle the deal.  Indeed, activists are openly advertising that they will try to incite people, even though the TPP’s IP provisions are all drawn from U.S. law and have been in other trade agreements for years.

Hopefully, however, the preceding points help cut through the click-bait and hyperventilation that characterizes their rhetoric, so reasonable people can draw their own conclusions about the TPP based on fact and principle.

August 28th, 2015 at 9:51 am
Rubio: Beat China via Free Trade and Passing Trans-Pacific Partnership, Not Self-Destructive Protectionism
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In confronting the growing challenge of China, as with Japan in the 1980s and other challengers in the past, the easy and simplistic response is to advocate protectionism.  But America remains the most prosperous and innovative nation in human history on the basis of free trade, not protectionism.  If closing borders to trade was the path to prosperity, then North Korea would be a global exemplar.

On that chord, Senator Marco Rubio (R – Florida), set to give a much-anticipated foreign policy speech on the campaign trail today, offers a refreshing commentary in today’s Wall Street Journal entitled “How My Presidency Would Deal With China.”  In his piece, Rubio advocates free trade and passing the Trans-Pacific Partnership as effective tools for confronting China, resisting the cheap and easy protectionist platitudes:

My second goal is protecting the U.S. economy.  For years, China has subsidized exports, devalued its currency, restricted imports and stolen technology on a massive scale.  As president, I would respond not through aggressive retaliation, which would hurt the U.S. as much as China, but by greater commitment and firmer insistence on free markets and free trade.  This means immediately moving forward with the Trans-Pacific Partnership and other trade agreements.”

Protectionism and irrational alarm over trade balance only serve to undermine American growth.  After all, the 1930s Great Depression in the U.S. witnessed trade surpluses in 102 of that decade’s 120 months.  The better answer is to maintain America’s standing as a nation of free trade, through which we will overcome today’s challenges just as we have previous decades’ similar challenges.

May 14th, 2012 at 4:45 pm
Trans-Pacific Partnership Negotiations Offer Important IP Opportunity
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At this moment in Dallas, Texas, the Trans-Pacific Partnership (TPP) trade negotiations have resumed, with important implications for intellectual property (IP).

According to the U.S. Commerce Department, 75 domestic industries it identifies as “IP-intensive” account for 40 million jobs, approximately 28% of our total employment.  Industries reliant upon IP also account for $5 trillion – some 35% – of total American gross domestic product (GDP), 61% of U.S. merchandise exports and pay wages 42% higher than non-IP employers.

It is therefore critical that TPP negotiators establish a solid foundation for IP protection as they move toward finalization.

The TPP currently consists of eight Pacific trading partners in addition to the U.S. – Australia, New Zealand, Singapore, Malaysia, Vietnam, Brunei, Chile and Peru.  In 2010 alone, America exported $89 billion in goods to those nations, making the TPP one of our largest collective export markets.  The express goal of the TPP charter is “to establish a comprehensive, next-generation regional agreement that liberalizes trade and investment and addresses new and traditional trade issues and 21st-century challenges.”  And with other Pacific region nations Japan, Canada and Mexico expressing interest in joining the TPP, the agreement currently under negotiation can set the foundation for future trade practices across the Pacific realm.

To its credit, the U.S. stands as a worldwide leader in demanding strong IP standards in agreements such as this, as reflected by domestic laws and international accords such as the one completed just last year with Korea.  Similarly, with pressure on to finalize TPP negotiations, we must ensure strong IP protections in the final agreement.  Doing so will prove beneficial in terms of protecting American jobs against theft and counterfeit, protecting American consumers against potentially dangerous products, reducing the threat to American creativity and innovation posed by copyright infringement, promoting future innovation, protecting American competitiveness against those who seek to steal our ideas and creations and setting clear rules for worldwide commerce.

If successful, we can set a sound foundation of IP protection, which will prove critical for American innovation, jobs, exports and continued prosperity in an increasingly Pacific-dominated 21st century.