336. The delegation of South Africa has introduced this item under the heading Intellectual Property and Public Interest. As delegates would recall we have had a long discussion and engagement on the issues on intellectual property and public interest as they pertained to access to health and health technologies and medicine. We thought that it was time to perhaps look at the public interest dimension more broadly than one would find it in the TRIPS Agreement and so from this perspective we would want to indicate that the focus of this and future communications will look at areas outside of access to health technologies and medicines, but that debate certainly does inform the kind of discussions that we have had essentially almost for these last two years.
337. The main purpose of this submission is to address the relationship between the WTO's TRIPS Agreement and copyright, as it relates to the three-step test on limitations and exceptions to copyright, with a view to clarifying the flexibilities to which Members are entitled, in particular, in fulfilling the principles and objectives of the TRIPS Agreement as set out in Articles 7 and 8 of the Agreement.
338. A balanced interpretation of the copyright three-step test, contained in Article 13 of the TRIPS Agreement, and predicated upon Article 9.2 of the Berne Convention for the Protection of Literary and Artistic Works, would ensure that WTO rules do not undermine Members' policies to promote access to knowledge, culture and development, protect human rights and otherwise promote the public interest, including through appropriate limitations and exceptions to copyright and related rights.
339. We note the contours of the three-step test as articulated in Article 13 of the TRIPS Agreement, which states that "Members shall confine limitations or exceptions to exclusive rights to certain special cases which do not conflict with a normal exploitation of the work and do not unreasonably prejudice the legitimate interests of the right-holder." Certainly, in that formulation we find a litany of technical references which has to be analysed and understood in this context.
340. Also, the objectives of the TRIPS Agreement as contained in Article 7 indicate that "protection 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 and to a balance of rights and obligations."
341. Similarly, Article 8 of the TRIPS Agreement provides Members with safeguards in formulating or amending their laws and regulations to "promote the public interest in sectors of vital importance to their socio-economic and technological development, provided that such measures are consistent with the provisions of this Agreement" and affording Members the right to adopt appropriate measures, provided that they are consistent with the provisions of this Agreement, "to prevent the abuse of intellectual property rights by right-holders or the resort to practices which unreasonably restrain trade or adversely affect the international transfer of technology."
342. Similarly, we have had a long debate on Article 40 of the TRIPS Agreement which deals with anti-competitive practices.
343. Access to information and knowledge is fundamental to achieve many objectives including education and scientific progress. While recognizing the need to protect legitimate interests of authors and other right-holders, we note that the TRIPS Agreement has "room to manoeuvre" with respect to the implementation of its obligations, including in the area of promoting access to knowledge, culture, education, development as well as other overarching policy objectives.
344. The centre piece of this paper is really the relationship between TRIPS and the three-step-test for limitations and exceptions to copyright. This, as Members will note, has not been the subject to in-depth scrutiny at the WTO, except for the Panel established to consider the United States – Section 110(5) of the Copyright Act case contained in DS160, which does provide some interpretation of Article 13 of the TRIPS Agreement in relation to Articles 11bis(1)(iii) and 11(1)(ii) of the Berne Convention (1971). The panel found that the three-step test requests three separate, independent and cumulative tests for copyright limitations and exceptions. There is disagreement with this interpretation among academic scholars and as it relates to state-practice. It would be useful to discuss the relationship between the TRIPS Agreement and the three-step test for limitations and exceptions to copyright in order to further clarify the flexibilities afforded to Members to fulfil their obligations in implementing the objectives and principles of the TRIPS Agreement.
345. The limitations that Members may provide pursuant to the provisions of the Berne Convention that have been incorporated into the TRIPS Agreement consist of so called 'free use' that is to say, the use of protected work that is without an obligation to request authorization or the payment of remuneration, and 'non-exclusive licences', (use without authorization but with the obligation to pay equitable compensation). Outside these specific free uses, for example common law jurisdictions also recognize the notion of 'fair use' or 'fair dealing', which covers various free uses under international law. The use of privileges at a national level are generally based on the international copyright acquis. There are many examples of national exceptions and limitations resting on the international three-step test as can be found in the copyright laws of parties to the Berne Convention, including for example reproduction for research or teaching purposes, privileges of libraries, archives or exemptions of reproduction required for administrative, parliamentary or judicial proceedings. It should be emphasized that fair use and fair dealing exceptions are not per se in conflict with the international three-step test including under the more specific approach that the TRIPS Agreement takes to the three-step test under Article 13.
346. Samuelson and Hachimoto observe the following: "…there is growing recognition that in an era of rapid technological change, flexible open-ended limitations and exceptions such as fair use, can play a useful role in balancing the legitimate interests of right-holders, subsequent creators and the public, and these could include fan fiction authors, making back-up copies of music and the like, in regulating various uses of copyrighted works that do not have market destructive effects. These days, legislatures simply cannot anticipate new uses of works in digital form and decide which ones should be permitted through crafting of specific exceptions. Applying fair use or a similar flexible doctrine can enable courts to weigh various factors in order to reach our principle decisions.
347. The above-mentioned paragraph also provides an important context for our on-going discussion on the 1998 Work Programme on Electronic Commerce. In 1996 the three-step test was incorporated into the WIPO Copyright Treaty (WCT) and the WIPO Performance and Phonographs Treaty WPPT), both are collectively known or referred to as the WIPO Internet Treaties. The Diplomatic Conference that adopted these two texts, adopted the following agreed statement in respect of Article 10 of the WIPO Copyright Treaty which applies mutatis mutandis to Article 16 of the WPPT and it states:
It is understood that the provisions of Article 10 permits Contracting Parties to carry forward and appropriately extend into the digital environment limitations and exceptions in their national laws which have been considered acceptable under the Berne Convention. Similarly, these provisions should be understood to permit Contracting Parties to devise new exceptions and limitations that are appropriate in the digital network environment.
348. South Africa invites Members to contribute to this discussion and to share their national approaches and experiences. We also include some questions for discussion as referenced in the document:
1. Does the three-step test constitute an indivisible whole to the extent that each of the three steps are to be considered together and as a whole in a comprehensive overall assessment?; and
2. What approaches have Members taken to reflect limitations and exceptions in their IP laws?
