U.S. Floats Nafta Proposal That Could Erode Copyright-Liability Protection

The U.S. has floated copyright language in North American Free Trade Agreement talks that could erode internet companies' liability protections for pirated content, according to lobbyists and congressional aides familiar with the negotiations.

In the latest round of talks in Ottawa to overhaul Nafta, U.S. negotiators formally introduced language that didn't include some of the well-established safeguards that protect Alphabet Inc.'s YouTube and other service providers from liability over pirated content posted by users, a tech-industry lobbyist said.

A U.S. official said the Trump administration hasn't finished its intellectual property proposals yet and will add more language in the future.

But the omission this week of "safe harbor" language favored by internet businesses is adding to tech company concerns that the administration is shifting highly sensitive copyright law toward Hollywood studios, the recording industry and the owners of intellectual property, according to people following the trade debate.

Congressional aides familiar with the Nafta talks say U.S. trade representative Robert Lighthizer is eager to boost intellectual property provisions in Nafta, a pact that includes the U.S., Canada and Mexico, potentially at the expense of internet businesses and broadband service providers.

"Past free trade agreements have uniformly promoted U.S. laws so that the entire American economy wins," said Noah Theran, spokesman for the Internet Association, a trade group that includes Alphabet and other major online companies. Mr. Lighthizer "should not cozy up to Hollywood and content in Nafta negotiations, undermining the will of Congress."

Trade agreements including Nafta cover not only tariffs and quotas on physical goods but also commercial rules of the road on a host of issues, including labor, the environment and intellectual property.

Such pacts face a vote in Congress, which can enact them via implementing legislation that makes changes to U.S. law. Lawmakers don't welcome international deals that undercut major acts of Congress, but the internet companies worry the Trump administration could be using Nafta as a backdoor way to shift U.S. copyright law.

Sen. Orrin Hatch (R., Utah), chairman of the Senate committee that oversees trade, said Tuesday he hopes a renegotiated Nafta will establish a model on intellectual property for future trade agreements.

"If we look around the world we see unprecedented challenges for America's artists," said Mr. Hatch, himself a songwriter, at a Capitol Hill meeting on intellectual property, an issue he has defended for years. "I believe the Trump administration understands the seriousness of these problems."

Treasury Secretary Steven Mnuchin, former White House adviser Steve Bannon and President Donald Trump all have ties to Hollywood studios or television content. The Obama administration, by contrast, was seen as closer to internet and technology businesses.

Besides the big internet companies, a small but vocal and well-organized constituency of consumers backs a free and open internet with limitations on copyrights.

On the other side, actors and musicians are eager to defend their content and want to make it easier to get pirated material removed online. "Of course it would be welcome," said Barton Herbison, head of the Nashville Songwriters Association International, when asked about a possible shift toward intellectual-property owners.

In the Trans-Pacific Partnership, an unratified 12-nation trade agreement signed by former President Barack Obama, the U.S. struck a balance on digital copyrights that didn't satisfy either side in the debate. Still, internet companies and studios each supported the deal because it would have given them other rights in the sprawling trade bloc.

A 1996 U.S. law, which helped Washington implement international agreements, included language known as "notice and take down," outlining a process for copyright holders to notify internet companies about copyright infringement and ask the internet firms to take the content down.

But for the Nafta revision the Motion Picture Association of America backs more liability for internet intermediaries for pirated content.

Such a proposal may generate resistance in Canada, where policy makers don't tend to support the level of copyright protection seen in Washington, industry experts say.

Write to William Mauldin at william.mauldin@wsj.com

(END) Dow Jones Newswires

September 26, 2017 17:23 ET (21:23 GMT)