MEPs To Vote Today On Key IP Legislation

by Ulrika Lomas, for LawAndTax-News.com, Brussels

25 April 2007

The European Parliament will today vote on legislation to extend criminal sanctions to certain types of intellectual property infringement.

The first EU directive aiming at harmonising national criminal laws was backed by the European Parliament's Legal Affairs committee in March, when it was adopted as a first-reading report.

If approved by the full Parliament and the Council, the proposed directive would oblige all Member States to consider as a criminal offence all intentional infringements of an intellectual property right carried out on a commercial scale. The text proposes, as a deterrent, measures ranging from fines to imprisonment, according to the gravity of the crime.

Members of the Legal Affairs' committee backed the overall aim of the Commission's proposal, while amending some of its provisions.

They excluded patent rights from the scope of the Directive, and decided that criminal sanctions should only apply to those infringements deliberately carried out to obtain a commercial advantage. Piracy committed by private users for personal, non-profit purposes was therefore also excluded.

The legislation aims to ensure that national judicial authorities will always be able to impose sufficiently serious penalties by setting out minimum levels for the heavier punishments imposed by national law.

Under the proposed Directive, in cases of serious crimes committed by a criminal organisation, the maximum penalty must be at least EUR300,000 and/or four years' imprisonment. The same applies where the offences carry a health or safety risk.

For less serious infringements, the maximum penalties should include criminal and civil fines of at least EUR100,000. In some cases, remedies can include the seizure and destruction of counterfeited goods.

The proposed legislation reflects the Commission's interpretation of the European Court of Justice’s judgment of 13 September 2005.

According to the Commission, this ruling allowed for measures under the Community method to insist on criminal sanctions, when these are required for the effective implementation of Community law.

However, in an open letter sent to the European Parliament ahead of today's vote, several consumer and civil rights groups, including the Electronic Frontier Foundation, and consumer organisation BEUC, argued that the terms which define criminal actions under the proposed Directive are too vague.

In particular, the groups called on MEPs to:

• Limit the scope of the directive to clear cases of copyright piracy and trademark counterfeiting;
• Provide legal certainty by adopting precise definitions of "on a commercial scale" and "intentional infringement", to ensure that the directive criminalizes only true criminal enterprises, involving copyright piracy and trademark violations done on a commercial scale, with the intention of earning a profit from the enterprise; and
• Avoid creating an unprecedented scope of secondary liability for Internet intermediaries, ICTs, software vendors and a range of legitimate business activity, by removing the words "aiding or abetting and inciting".

Commenting on the matter earlier this week on behalf of the Foundation for a Free Information Infrastructure (another of the signatories to the open letter), Ante Wessels argued that:

"It is essential to make a good distinction between legitimate businesses and pirates. While FFII welcomes taking out patents, it is not enough. And secondary liability is a major threat for software developers and internet service providers."

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