Reps. Lofgren and Boucher Address FTAs and DMCA

June 18, 2003. Rep. Zoe Lofgren (D-CA) and Rep. Rick Boucher (D-VA) urged passage of two bills that would amend the DMCA to provide exceptions to its anti-circumvention provisions. They also stated that Secretary of Commerce Don Evans has advised them that these bills would not breach the treaty obligations of the U.S. under the negotiated Singapore and Chile free trade agreements (FTA). President Bush signed the Singapore FTA on May 6, 2003, and U.S. Trade Representative (USTR) Robert Zoellick signed the Chile FTA on June 6, 2003. Both require approval by the Congress.

Rep. Lofgren and Rep. Boucher wrote a letter to USTR Zoellick on April 24, 2003. They stated that the FTAs "contain provisions that essentially mimic the Digital Millennium Copyright Act (DMCA), a law that is currently being litigated and whose scope is as yet unclear. As you know, the DMCA, while intended to protect the legitimate interests of copyright holders, may also be endangering the rights and expectations of legitimate consumers. Contrary to the intent of Congress, as expressed by Judiciary Committee Chairman Henry Hyde at the time of the adoption of the DMCA, section 1201 of title 17, United States Code, has been interpreted to prohibit all users -- even lawful ones -- from circumventing technical restrictions for any reason, including non-infringing use of a purchased content. There is substantial reason to believe that the DMCA is having an adverse impact on technological innovation. There are numerous cases in court or on appeal that would utilize this act to stifle competition and technological innovation." (Footnote omitted.)

They then posed the question, "If Congress decides to clarify the DMCA to strike the correct balance between copyright holders and the interests of society, as intended by Congress, would the United States be in violation of the FTA's?"

This April 24 letter specifically referenced two bills that would amend the DMCA that are pending in Congress. First, it mentions HR 1066, the "Benefit Authors without Limiting Advancement or Net Consumer Expectations (BALANCE) Act of 2003", introduced by Rep. Lofgren and Rep. Boucher on March 4, 2003. Second, it mentions HR 107, the "Digital Media Consumers' Rights Act of 2003", introduced by Rep. Boucher and others on January 7, 2003.

The April 24 letter also states that Rep. Lofgren, in a briefing by USTR staff, "was advised orally that the treaties would be breached by the enactment of these bills into law".

Rep. Lofgren (at right) and Rep. Boucher also wrote a letter to Secretary of Commerce Don Evans on May 9, 2003, in which they posed the same question, namely, "If Congress decides to clarify the DMCA to strike the correct balance between copyright holders and the interests of society, as intended by Congress, would the United States be in violation of the FTA's?"

On June 5, 2003, Secretary Evans wrote a letter to Rep. Lofgren responding to the May 9 letter. He wrote that "You expressed concern that the incorporation of provisions based on the Digital Millennium Copyright Act (DMCA) in the Singapore and Chile FTAs may have an adverse impact on technological innovation. I believe, however, that strong protection and enforcement of intellectual property rights in FTAs facilitate the expansion of trade and investment in digital technologies and products, thereby advancing the interests of all parties to the FTAs."

He did not state in his letter that the FTAs would be breached by passage of HR 1066 and HR 107. Rather, he wrote that "If the Congress amends the DMCA in the future, the FTAs should then be reviewed for consistency with the amended DMCA."

Of course, this statement by Secretary Evans stops short of advising that the two bills are consistent with the two FTAs.

Rep. Lofgren and Rep. Boucher (at right) issued a release on June 18, 2003. Rep. Lofgren stated in this release that "Earlier this year, I was advised by the Office of the U.S. Trade Representative (USTR) that if we amend the DMCA, we would be in breach of our treaty obligations with Chile and Singapore. I am pleased that the Secretary of Commerce has now confirmed that Congress may amend the DMCA even after the Chile and Singapore FTAs, containing DMCA provisions, are enacted."

Rep. Boucher stated in this same release that "The response we received from the Secretary of Commerce is promising. It alleviates our concern that the Administration had somehow sought to tie the hands of Congress by seeking to effectively prevent it from amending a law that has had many troublesome consequences for consumers and innovators of technology".

Rep. Boucher added that "With the Administration now negotiating the more far-reaching Free Trade Area of the Americas Agreement, we should amend the DMCA now so that the balance we strike can be incorporated into the agreement and preserve the fair use rights of consumers throughout the Western Hemisphere."

HR 1066. HR 1066 contains many provisions. One section would substantially rewrite § 1201, which was added to the Copyright Act by the DMCA.

First, it adds language stating that "Notwithstanding any other provision in this title, a person who lawfully obtains a copy or phonorecord of a work, or who lawfully receives a transmission of a work, may circumvent a technological measure that effectively controls access to the work or protects a right of the copyright holder under this title if -- (A) such act is necessary to make a noninfringing use of the work under this title; and (B) the copyright owner fails to make publicly available the necessary means to make such noninfringing use without additional cost or burden to such person."

Second, it adds language permitting circumvention technologies. It states that "any person may manufacture, import, offer to the public, provide, or otherwise make available technological means to circumvent a technological measure that effectively controls access or protects a right of a copyright holder under this title if (A) such means are necessary to enable a non-infringing use ... ; (B) such means are designed, produced and marketed to enable a non-infringing use ... ; and (C) the copyright owner fails to make available the necessary means ..."

See, story titled "Rep. Lofgren Re-Introduces Digital Fair Use Bill" in TLJ Daily E-Mail Alert No. 618, March 6, 2003. This is substantially the same bill as HR 5522, the Digital Choice and Freedom Act of 2002, which Rep. Lofgren introduced late in the 107th Congress. See, TLJ story titled "Rep. Lofgren Introduces Digital Fair Use Bill", October 2, 2002.

HR 107. HR 107 would roll back the anti-circumvention provisions of the Digital Millennium Copyright Act (DMCA). Specifically, it would create fair use exceptions to the bans on circumvention of technological measures to protect copyrighted works. It would also provide an exception for scientific research into technological protection measures.

See, story titled "Reps. Boucher and Doolittle Introduce Digital Fair Use Bill" in TLJ Daily E-Mail Alert No. 582, January 14, 2003. This is essentially the same bill as HR 5544 (107th), a bill by the same title that the two introduced late in the 107th Congress. See, TLJ story titled "Reps. Boucher and Doolittle Introduce Digital Media Consumer Rights Act", October 3, 2002.

DMCA Provisions if FTAs. For example, the U.S. Chile FTA provides that "In order to provide adequate legal protection and effective legal remedies against the circumvention of effective technological measures that are used by authors, performers, and producers of phonograms in connection with the exercise of their rights and that restrict unauthorized acts in respect of their works, performances, and phonograms, protected by copyright and related rights: (a) each Party shall provide that any person who knowingly circumvents without authorization of the right holder or law consistent with this Agreement any effective technological measure that controls access to a protected work, performance, or phonogram shall be civilly liable and, in appropriate circumstances, shall be criminally liable, or said conduct shall be considered an aggravating circumstance of another offense."

This FTA also provides that "each Party shall also provide administrative or civil measures, and, where the conduct is willful and for prohibited commercial purposes, criminal measures with regard to the manufacture, import, distribution, sale, or rental of devices, products, or components or the provision of services which: (i) are promoted, advertised, or marketed for the purpose of circumvention of any effective technological measure, or (ii) do not have a commercially significant purpose or use other than to circumvent any effective technological measure, or (iii) are primarily designed, produced, adapted, or performed for the purpose of enabling or facilitating the circumvention of any effective technological measures."

The Chile FTA goes on to state that "Each Party shall confine limitations and exceptions to measures implementing subparagraphs (a) and (b) to certain special cases that do not impair the adequacy of legal protection or the effectiveness of legal remedies against the circumvention of effective technological measures." The agreement sets out eight specific exemptions and limitations that are permissible. Fair use is not enumerated.