Mickey Mouse Holds Key To The Future
December 8, 2003, Australian Financial Review, by Mark Davis
Trade Minister Mark Vaile calls it the Mickey Mouse clause.
It's part of a push by the United States in free-trade negotiations to import tough new American intellectual property rules into Australian law.
Overshadowed by issues in the free-trade agreement debate like agriculture and local content rules, the US push on intellectual property has significant implications for industries including film production, publishing and music recording.
If successful it will alter the balance of power between content owners and content disseminators such as internet service providers.
And it could water down the Australian Competition and Consumer Commission's efforts to ensure content owners do not abuse intellectual property to shield themselves from competition.
So where does Mickey Mouse enter the picture? Disney's copyright of the famous animated mouse was due to expire this year, meaning the image would have been in the public domain for all to use.
But back in 1998, the Walt Disney Company and US entertainment industries allies persuaded Congress to extend copyright protection.
Congress passed the Sonny Bono Copyright Term Extension Act, which extended the term of copyright protection by 20 years. Under the law, works copyrighted by individuals since 1978 are now protected for the life of the author plus 70 years (compared with the old rule of life plus 50 years). Works made by or for corporations are shielded for 95 years.
According to a prominent Washington anti-trust lawyer, Chris Sprigman , the law meant tens of thousands of works that had been poised to enter the public domain have been kept under private ownership until 2019.
Now US trade negotiators want Australia to agree to extend its copyright term protection as part of the intellectual property chapter of the planned FTA between the two countries. In economic terms, copyright and other forms of intellectual property are government-created monopolies.
By giving one producer a monopoly they allow that producer to boost prices and secure higher returns. This encourages creative activity and investment in the production of things ranging from Mickey Mouse to the latest anti-cancer drugs.
In deciding on the design features of copyright legislation, governments try to strike a balance between the costs to consumers of higher prices and the benefits of encouraging creative effort.
Following last week's latest round of FTA negotiations, Mr Vaile said copyright term extension was one of the "standout issues" where Australia and the US remained at odds in the intellectual property section of the negotiations.
He said Australia was "pushing back" on the issue at this stage.
"It is a very important issue, particularly in terms of cost to libraries, educational institutions and the like here in Australia," he said.
"There is a whole constituency out there with a strong view against copyright term extension and we are arguing that case."
The second area of tension in the trade negotiations is around US demands for Australia to bring rules on abuses of intellectual property on the internet into line with the US Digital Millennium Copyright Act.
Where intellectual property is being abused on the internet say by a teenager in his bedroom posting illegal copies of music recordings on a website the US legislation provides a speedy remedy for the copyright owner. Instead of having to pursue the offending website operator through the courts, the copyright owner simply serves a notice requiring the internet service provider to "take down" the website.
The US entertainment industry and its local counterparts reckon Australia's existing rules on ISP liability for copyright infringement are too lax.
The Interactive Entertainment Association of Australia said in a submission to the federal government: "In our view the current regime for ISP liability is biased towards ISPs and does not give them sufficient incentive to co-operate with copyright owners in fighting internet piracy."
Mr Vaile believes this is an area where Australia and the US should be able to reach a compromise.
He rejects the notion that intellectual property could be used by the giant US entertainment industries as a form of trade protectionism.
"It can cut both ways," he said. "Australia is getting smarter itself at registering and protecting its intellectual property.
"We need to remember how our economy is developing and that we need to be able to protect intellectual property too."
It may be the Mickey Mouse clause in any eventual FTA but intellectual property is clearly anything but a Mickey Mouse issue.