NGU & CO LAW FIRM
NGU & CO LAW FIRM
Barristers and Solicitors of the Cameroon Supreme Court
OAPI PATENT AND TRADEMARK ATTORNEYS / AGENTS
An Analysis of the Impact of Electronic Commerce On Intellectual Property
By
SIMON N. CHE (Managing Partner, Ngu and co law firm , Cam Cameroon Building Akwa P. O. BOX 2250 Douala Cameroon, Tel: +(237)33431273 Fax +(237) 3431273 E-mail: simon@nguandco.com
website : www.nguandco.com
Intellectual property law is the area of the law that deals with legal rights
associated with the creative effort or commercial reputation and goodwill.
The law deters people from copying or taking unfair advantage of the work
or reputation of others and provides remedies should this happen. There are
several different forms of rights or areas of law giving rise to rights that
together constitute what is jointly referred to as intellectual property.
These are as follows: trademarks, patents copyright, rights in performances,
the law of confidence, registered designs, design rights passing off, trade
libel and rights associated with plant and seed varieties protection. [2]
For the purposes of this project, I will treat only the intellectual property
rights that are remarkably affected by the explosion of the web in general
and electronic commerce in particular. These are: trademarks, patents, copyright
and related rights. However, although the concept of domain names is protected
under a different set of laws, I will for the purposes of this dissertation
treat it because of the crucial role it plays in the arena of both electronic
commerce and the protection of trademarks. Cybersquatting is the term that
has been coined for the ever increasing confusion and tension that exist between
the use of domain names on the internet and the protection against the copying
or taking undue advantage of the rights of registered trademark holders. [3]
Trademarks
A trademark is defined as any sign capable of being represented
graphically, which is capable of distinguishing goods or services of one undertaking
from those of other undertakings. [2] Therefore the main functions of a trademark
are: protection against confusion or deception in the market place; protection
against unfair competition, indicator of the origin of products or services;
distinguishing of the function of products or services; protection against
the dilution of well known products and services; product identification;
indicator of quality; advertising; distinguishing social status and for commercial
exploitation of products and services. Intellectual Property by David Bainbridge
[2] provides a more detail discussion of trademarks.
Domain names
Domain names are a simple form of an Internet address, designed to serve the
function of enabling users to locate sites on the Internet in an easy manner.
They may be registered in spaces known as “ generic top-level domains”
(gTLDs) such as .com, .org, .net, or in the “country code top-level domains”
(ccTLDs) such as .ch for Switzerland , .fr for France, .cm for Cameroon or
.uk for the United Kingdom etc.
The use of the domain name system has grown and is continuing to grow very
rapidly. Since domain names are easy to remember and use, the domain name
system (DNS), the central system for routing traffic on the Internet has assumed
a key role in electronic commerce. On the one hand, it facilitates the ability
of consumers to navigate the internet to find web sites they are looking for,
and on the other hand, it facilitates businesses’ ability to promote
and an easy to remember name or word which may, at the same time, serve to
identify and distinguish the business itself or it’s goods or services
and to specify its corresponding online, Internet location. [2]
Following the increase of commercial activities on the Internet, domain names
have acquired increasing significance as business identifiers and consequently
have come into conflict with the traditional system of business identifiers
that existed prior to the Internet and that are protected by intellectual
property rights, namely, trademarks and other rights of business identification,
geographical indications and the developing field of personality rights. The
tension between domain names and intellectual property rights has led to many
problems that raise challenging questions.
On the one hand the Domain Name System (DNS) is largely privately administered
and gives rise to registrations that result in a global presence, accessible
from anywhere in the world. On the other hand, the intellectual property rights
system is publicly administered on a territorial basis and gives rise to rights
that are exercisable and enforceable only within the territory concerned.
This lack harmony between the two systems has been exacerbated by some predatory
and parasitical practices that have been adopted by some people to exploit
the lack of connection between the purposes for which the domain name system
was designed and those for which intellectual property protection exists.
Example of such practices include but are not limited to the deliberate, bad
faith registration as domain names of trademarks in the hope of being able
to sell the domain names to the owners of the trademarks, or simply to take
unfair advantage of the reputation attached to the trademarks in issue. [3]
Copyrights and related rights
Copyright is concerned with the protection of literary and artistic works.
Copyright is therefore a property right, which subsists in various works,
for example literary works, artistic works, musical works, sound recordings
films and broadcast. Copyright gives the owner of a work that is protected
by copyright the exclusive right to do certain things in relation to the which
include but are not limited to making a copy, broadcasting or giving a public
performance. Anyone else who does any acts restricted by copyright without
the permission of the copyright owner may be subject to legal action taken
by the owner of the copyright for copyright infringement. However, ownership
of copyright is alienable and it can be transferred to another or a licence
may be granted by the owner to another, permitting him to do one or more specified
acts with the work in question. [2]
Copyright does not protect an idea; it is the expression of an idea that is
protected i.e. a tangible form – painting, book etc.
International protection of copyright works is affected mainly through two
international conventions i.e. the Berne Copyright Convention [4] and the
Universal Copyright Convention [5]. The United Kingdom is a member of both
conventions. Both conventions lay down minimum standards of protection to
be attained and reciprocity of protection between member countries. The conventions
have been responsible for the high level of harmony that now exist on the
world stage. Therefore because of agreements under the conventions it is possible
for a foreign citizen to take legal action in the United Kingdom for copyright
infringement occurring there, as if he or she was a British citizen. The author
of copyright is the person who creates the work in which copyright subsists,
however, for some type of works, the author is the person by whom the arrangements
necessary for the creation of the work are undertaken i.e. an employer. [2]
Patents
A patent is a monopoly right to the exclusive use of an invention and can
last for a maximum of 20 years. A patent is a property, which like any other
business commodity, may be bought, sold, hired or licensed.
Generally the purpose of a patent is to provide a form of protection for technological
advances. The idea is to provide a reward not only for the creation of an
invention, but also for the development of an invention to the point at which
in is technologically feasible and marketable. The protection and reward is
also aimed at promoting additional creativity and encourage companies to continue
their development of new technology to the point at which it is marketable,
useful to the public and desirable for the public good.
To obtain patent protection the applicant must also show proof of the following:
That the invention is new or novel. The invention should be capable of being
considered a new solution of a technological problem. However, there is no
requirement for the invention to be represented in a physical embodiment.
That it is non – obvious, that is to say, it must involve an inventive
step. The invention must be enough of an advancement to be considered non
– obvious by a person having ordinary skills in the art over the state
of technology before the invention.
That it is useful, that the invention should be capable of industrial application.
[2] The invention must be able to be used on a certain scale in practice i.e.
exploitable in industry.
Not all inventions are patentable, to be able to obtain a patent, the applicant
must proof that the invention concerns the composition, construction or manufacture
of a substance, article or apparatus, or with an industrial type of process,
as distinct from artistic creations.
Some categories of inventions are specifically excluded from patentability.
These include the following:
Things that exist in nature, which are discovered and not invented,
Machines that defy the laws of nature
Scientific theory,
Mathematical methods,
Schemes, rules or methods, such as those for doing business,
performing purely mental acts or playing games,
Methods for medical treatment for humans or animals or diagnostics
methods, however, products used in making diagnostics are patentable.
The advantages of taking out a patent are the rights granted the patent owner
by law to exclude all others in the territory covered by the patent from making,
using, selling or importing the invention. This however, does not give the
inventor or the owner of the patent the right to use the invention if it’s
use is illegal. The inventor or the owner of a patent can prevent others from
marketing and profiting from the invention for a period of 20 years from the
date on which the application is filed. What this right, granted by the law
to the owner of the patent does is give the developer of the technology the
right to have it to himself for 20 years in exchange for full disclosure to
the public of how to use it. When the patent expires, the technology becomes
public property, and the public is free to use it. [2]
Patent protection can be obtained and enforceable only on a country-by-country
basis with the exception of some regional arrangements that permit a regional
protection such the European Patent Organisation. [6]
There is also an International Agreement administered by the World Intellectual
Property Organisation (WIPO), called the Patent Cooperation Treaty (PCT) for
the filing, searching, publication and examination of international applications.
However, the Patent Cooperation Treaty only makes it easier to obtain patents
in the Contracting States by providing for the filing of one international
application, which may be subsequently prosecuted in the different designated
National or Regional Offices of the States party to the Patent Cooperation
Treaty. The granting of patent protection in the respective countries designated
in the international application is left to the respective designated Offices.
They would require the applicant of the international application to enter
a regional phase in the designated Offices concerned and to pay the relevant
filing and maintenance fees, with the only exceptions being that the date
when the international application was made would be considered as the official
filing date and the application will not be re-examined for novelty, inventive
step and industrial applicability. The designated Offices will take the filing,
search, examination and publication of the international application into
consideration. [7]
There is unfortunately no single world patent. Filing, examination, granting
of protection, maintenance and the payment of the relevant fees, and enforcement
of infringement have to be done on a country-by-country basis. This is generally
not only very expensive but is also a very difficult thing to do. Mere failure
to pay yearly maintenance fee in one country will cause the patent to lapse
in that country, meaning any one in that country is free to use it as he or
she pleases. With the advent of the Internet, patent disclosure could now
be done on the Internet; this would mean a global disclosure of the invention,
with all its direct and indirect consequences. Therefore a person who is resident
in any country in the world in which the owner of the invention has not been
able to seek and obtain protection of the invention can easily have access
to a full disclosure through the Internet and proceed to exploit the invention
without the consent of the owner of the invention. Worst still he or she may
wish to use the knowledge acquired from the disclosure to obtain patent protection
in his or her country of residence without the consent or even the knowledge
of the rightful owner of the invention. This posses major problems both for
intellectual property in general and patent protection in particular.
This project is aimed at attempting an analysis of some of these problems
and providing guidelines for companies involved in on-lines businesses and
owners of intellectual property rights in general and patents in particular
on how to identify and deal with these problems.
Aims of the project
The use of electronic transactions through the Internet which provide a global
medium, not in any manner limited by territorial boundaries is increasingly
posing serious problems for acquisition, exploitation and enforcement of well
known forms of intellectual property rights which are enshrined in different
pieces national legislations and international conventions.
The main aims of this project are:
Undertake an analysis of the impact of electronic Commerce transactions
on some forms of intellectual property rights i.e. trademarks, domain names,
copyright and related rights and patents.
Provide guidelines for companies involved or wishing to set up on-line businesses,
on how to identify and handle issue s relating to intellectual property.
To critically appraise the problems and conflicts experienced in the on-line
business community as a result of the overlap between the utilisation of the
medium provided by the Internet for on-line businesses to access global markets
at minimal cost and the legal and regulatory restrictions imposed on them
by national legislations and international conventions that accord protection
to owners of intellectual property rights such as trademarks, copyright and
related rights and patent law.
To attempt to provide guidelines on the level of legal compliance required
of on-line businesses by national legislations and international conventions
dealing with intellectual property law. Compliance will be accessed on the
lines of remedies and recommendations so far provided by the world Intellectual
Property Organisation (WIPO) [8].
Overview of electronic commerce
The evolutions in Internet technologies and its use by an every increasing
number of people and businesses in the world as led to rapid expansion and
vulgarisation of electronic commerce. This has forced not only businesses
but almost all other areas of human activities to try to adjust to the new
exigencies and opportunities brought about by Internet and the related technologies.
The term electronic commerce is commonly used in common parlance to refer
to a broad class of activities, which are generally understood to be associated
with the use of a computer and the Internet to buy and sell goods and services
in a new, direct and electronic manner. The Internet provides the virtual
market place for buying and selling, trading, advertising and transactions
of all kinds. Like with most other areas this expansion of electronic commerce
has had a very significant impact on intellectual property.
The concept of electronic commerce is better explained by addressing separately
it’s two constitute words i.e. “Electronic “ and “Commerce”.
The term electronic refers to the global infrastructure of computers and telecommunication
technology and networks upon which the processing and transmission of digitised
data takes place. This could be private and proprietary networks or open networks
with non-proprietary protocols such as the Internet. [1]
The Internet unlike the private and proprietary networks allows communication
and transactions to take place over an “open network” with no required
security apparatus between potentially unlimited numbers of participants who
may have had no pre-existing contacts. The open nature of the Internet along
with its multifunctional character and the increasingly low cost of accessing
it has galvanized the potential for electronic commerce.
The Internet also provides access to a digital medium in which many perfect
copies of text, images, and sound can be easily made and transmitted and therefore
making it possible for material that is protected by intellectual property
laws such as trademarks, copyright and related rights, patents etc to be easily
misused and thus posing new challenges for intellectual property owners and
law makers concerned with legislating in the area of intellectual property.
The word “commerce” as used in electronic commerce refers to an
expanding array of activities taking place on the open-networks. Examples
include but are not limited to buying, selling, trading, marketing, advertising
and transactions of all kinds that lead to an exchange of value between two
parties. On-line auctions, sale of software, music, pornography are just a
few of the millions of products that are commercialised in the virtual market
place provided by Internet technology. [1]
Overview of intellectual property
Intellectual property law is the area of the law that deals with legal rights
associated with the creative effort or commercial reputation and goodwill.
The law deters people from copying or taking unfair advantage of the work
or reputation of others and provides remedies should this happen. There are
several different forms of rights or areas of law giving rise to rights that
together constitute what is jointly referred to as intellectual property.
These are as follows: trademarks, patents copyright, rights in performances,
the law of confidence, registered designs, design rights passing off, trade
libel and rights associated with plant and seed varieties protection. [2]
For the purposes of this project, I will treat only the intellectual property
rights that are remarkably affected by the explosion of the web in general
and electronic commerce in particular. These are: trademarks, patents, copyright
and related rights. However, although the concept of domain names is protected
under a different set of laws, I will for the purposes of this dissertation
treat it because of the crucial role it plays in the arena of both electronic
commerce and the protection of trademarks. Cybersquatting is the term that
has been coined for the ever increasing confusion and tension that exist between
the use of domain names on the internet and the protection against the copying
or taking undue advantage of the rights of registered trademark holders. [3]
Trademarks
A trademark is defined as any sign capable of being represented graphically,
which is capable of distinguishing goods or services of one undertaking from
those of other undertakings. [2] Therefore the main functions of a trademark
are: protection against confusion or deception in the market place; protection
against unfair competition, indicator of the origin of products or services;
distinguishing of the function of products or services; protection against
the dilution of well known products and services; product identification;
indicator of quality; advertising; distinguishing social status and for commercial
exploitation of products and services. Intellectual Property by David Bainbridge
[2] provides a more detail discussion of trademarks.
Domain names
Domain names are a simple form of an Internet address, designed to serve the
function of enabling users to locate sites on the Internet in an easy manner.
They may be registered in spaces known as “ generic top-level domains”
(gTLDs) such as .com, .org, .net, or in the “country code top-level domains”
(ccTLDs) such as .ch for Switzerland , .fr for France, .cm for Cameroon or
.uk for the United Kingdom etc.
The use of the domain name system has grown and is continuing to grow very
rapidly. Since domain names are easy to remember and use, the domain name
system (DNS), the central system for routing traffic on the Internet has assumed
a key role in electronic commerce. On the one hand, it facilitates the ability
of consumers to navigate the internet to find web sites they are looking for,
and on the other hand, it facilitates businesses’ ability to promote
and an easy to remember name or word which may, at the same time, serve to
identify and distinguish the business itself or it’s goods or services
and to specify its corresponding online, Internet location. [2]
Following the increase of commercial activities on the Internet, domain names
have acquired increasing significance as business identifiers and consequently
have come into conflict with the traditional system of business identifiers
that existed prior to the Internet and that are protected by intellectual
property rights, namely, trademarks and other rights of business identification,
geographical indications and the developing field of personality rights. The
tension between domain names and intellectual property rights has led to many
problems that raise challenging questions.
On the one hand the Domain Name System (DNS) is largely privately administered
and gives rise to registrations that result in a global presence, accessible
from anywhere in the world. On the other hand, the intellectual property rights
system is publicly administered on a territorial basis and gives rise to rights
that are exercisable and enforceable only within the territory concerned.
This lack harmony between the two systems has been exacerbated by some predatory
and parasitical practices that have been adopted by some people to exploit
the lack of connection between the purposes for which the domain name system
was designed and those for which intellectual property protection exists.
Example of such practices include but are not limited to the deliberate, bad
faith registration as domain names of trademarks in the hope of being able
to sell the domain names to the owners of the trademarks, or simply to take
unfair advantage of the reputation attached to the trademarks in issue. [3]
Copyrights and related rights
Copyright is concerned with the protection of literary and artistic works.
Copyright is therefore a property right, which subsists in various works,
for example literary works, artistic works, musical works, sound recordings
films and broadcast. Copyright gives the owner of a work that is protected
by copyright the exclusive right to do certain things in relation to the which
include but are not limited to making a copy, broadcasting or giving a public
performance. Anyone else who does any acts restricted by copyright without
the permission of the copyright owner may be subject to legal action taken
by the owner of the copyright for copyright infringement. However, ownership
of copyright is alienable and it can be transferred to another or a licence
may be granted by the owner to another, permitting him to do one or more specified
acts with the work in question. [2]
Copyright does not protect an idea; it is the expression of an idea that is
protected i.e. a tangible form – painting, book etc.
International protection of copyright works is affected mainly through two
international conventions i.e. the Berne Copyright Convention [4] and the
Universal Copyright Convention [5]. The United Kingdom is a member of both
conventions. Both conventions lay down minimum standards of protection to
be attained and reciprocity of protection between member countries. The conventions
have been responsible for the high level of harmony that now exist on the
world stage. Therefore because of agreements under the conventions it is possible
for a foreign citizen to take legal action in the United Kingdom for copyright
infringement occurring there, as if he or she was a British citizen. The author
of copyright is the person who creates the work in which copyright subsists,
however, for some type of works, the author is the person by whom the arrangements
necessary for the creation of the work are undertaken i.e. an employer. [2]
Patents
A patent is a monopoly right to the exclusive use of an invention and can
last for a maximum of 20 years. A patent is a property, which like any other
business commodity, may be bought, sold, hired or licensed.
Generally the purpose of a patent is to provide a form of protection for technological
advances. The idea is to provide a reward not only for the creation of an
invention, but also for the development of an invention to the point at which
in is technologically feasible and marketable. The protection and reward is
also aimed at promoting additional creativity and encourage companies to continue
their development of new technology to the point at which it is marketable,
useful to the public and desirable for the public good.
To obtain patent protection the applicant must also show proof of the following:
That the invention is new or novel. The invention should be capable of being
considered a new solution of a technological problem. However, there is no
requirement for the invention to be represented in a physical embodiment.
That it is non – obvious, that is to say, it must involve an inventive
step. The invention must be enough of an advancement to be considered non
– obvious by a person having ordinary skills in the art over the state
of technology before the invention.
That it is useful, that the invention should be capable of industrial application.
[2] The invention must be able to be used on a certain scale in practice i.e.
exploitable in industry.
Not all inventions are patentable, to be able to obtain a patent, the applicant
must proof that the invention concerns the composition, construction or manufacture
of a substance, article or apparatus, or with an industrial type of process,
as distinct from artistic creations.
Some categories of inventions are specifically excluded from patentability.
These include the following:
Things that exist in nature, which are discovered and not invented,
Machines that defy the laws of nature
Scientific theory,
Mathematical methods,
Schemes, rules or methods, such as those for doing business, performing purely
mental acts or playing games,
Methods for medical treatment for humans or animals or diagnostics methods,
however, products used in making diagnostics are patentable.
The advantages of taking out a patent are the rights granted the patent owner
by law to exclude all others in the territory covered by the patent from making,
using, selling or importing the invention. This however, does not give the
inventor or the owner of the patent the right to use the invention if it’s
use is illegal. The inventor or the owner of a patent can prevent others from
marketing and profiting from the invention for a period of 20 years from the
date on which the application is filed. What this right, granted by the law
to the owner of the patent does is give the developer of the technology the
right to have it to himself for 20 years in exchange for full disclosure to
the public of how to use it. When the patent expires, the technology becomes
public property, and the public is free to use it. [2]
Patent protection can be obtained and enforceable only on a country-by-country
basis with the exception of some regional arrangements that permit a regional
protection such the European Patent Organisation. [6]
There is also an International Agreement administered by the World Intellectual
Property Organisation (WIPO), called the Patent Cooperation Treaty (PCT) for
the filing, searching, publication and examination of international applications.
However, the Patent Cooperation Treaty only makes it easier to obtain patents
in the Contracting States by providing for the filing of one international
application, which may be subsequently prosecuted in the different designated
National or Regional Offices of the States party to the Patent Cooperation
Treaty. The granting of patent protection in the respective countries designated
in the international application is left to the respective designated Offices.
They would require the applicant of the international application to enter
a regional phase in the designated Offices concerned and to pay the relevant
filing and maintenance fees, with the only exceptions being that the date
when the international application was made would be considered as the official
filing date and the application will not be re-examined for novelty, inventive
step and industrial applicability. The designated Offices will take the filing,
search, examination and publication of the international application into
consideration. [7]
There is unfortunately no single world patent. Filing, examination, granting
of protection, maintenance and the payment of the relevant fees, and enforcement
of infringement have to be done on a country-by-country basis. This is generally
not only very expensive but is also a very difficult thing to do. Mere failure
to pay yearly maintenance fee in one country will cause the patent to lapse
in that country, meaning any one in that country is free to use it as he or
she pleases. With the advent of the Internet, patent disclosure could now
be done on the Internet; this would mean a global disclosure of the invention,
with all its direct and indirect consequences. Therefore a person who is resident
in any country in the world in which the owner of the invention has not been
able to seek and obtain protection of the invention can easily have access
to a full disclosure through the Internet and proceed to exploit the invention
without the consent of the owner of the invention. Worst still he or she may
wish to use the knowledge acquired from the disclosure to obtain patent protection
in his or her country of residence without the consent or even the knowledge
of the rightful owner of the invention. This posses major problems both for
intellectual property in general and patent protection in particular.
This project is aimed at attempting an analysis of some of these problems
and providing guidelines for companies involved in on-lines businesses and
owners of intellectual property rights in general and patents in particular
on how to identify and deal with these problems.
Trademarks
A trademark is defined as any sign capable of being represented graphically, which is capable of distinguishing goods or services of one undertaking from those of other undertakings. [2] Therefore the main functions of a trademark are: protection against confusion or deception in the market place; protection against unfair competition, indicator of the origin of products or services; distinguishing of the function of products or services; protection against the dilution of well known products and services; product identification; indicator of quality; advertising; distinguishing social status and for commercial exploitation of products and services. Intellectual Property by David Bainbridge [2] provides a more detail discussion of trademarks.
Domain names
Domain names are a simple form of an Internet address, designed to serve the
function of enabling users to locate sites on the Internet in an easy manner.
They may be registered in spaces known as “ generic top-level domains”
(gTLDs) such as .com, .org, .net, or in the “country code top-level domains”
(ccTLDs) such as .ch for Switzerland , .fr for France, .cm for Cameroon or
.uk for the United Kingdom etc.
The use of the domain name system has grown and is continuing to grow very
rapidly. Since domain names are easy to remember and use, the domain name
system (DNS), the central system for routing traffic on the Internet has assumed
a key role in electronic commerce. On the one hand, it facilitates the ability
of consumers to navigate the internet to find web sites they are looking for,
and on the other hand, it facilitates businesses’ ability to promote
and an easy to remember name or word which may, at the same time, serve to
identify and distinguish the business itself or it’s goods or services
and to specify its corresponding online, Internet location. [2]
Following the increase of commercial activities on the Internet, domain names
have acquired increasing significance as business identifiers and consequently
have come into conflict with the traditional system of business identifiers
that existed prior to the Internet and that are protected by intellectual
property rights, namely, trademarks and other rights of business identification,
geographical indications and the developing field of personality rights. The
tension between domain names and intellectual property rights has led to many
problems that raise challenging questions.
On the one hand the Domain Name System (DNS) is largely privately administered
and gives rise to registrations that result in a global presence, accessible
from anywhere in the world. On the other hand, the intellectual property rights
system is publicly administered on a territorial basis and gives rise to rights
that are exercisable and enforceable only within the territory concerned.
This lack harmony between the two systems has been exacerbated by some predatory
and parasitical practices that have been adopted by some people to exploit
the lack of connection between the purposes for which the domain name system
was designed and those for which intellectual property protection exists.
Example of such practices include but are not limited to the deliberate, bad
faith registration as domain names of trademarks in the hope of being able
to sell the domain names to the owners of the trademarks, or simply to take
unfair advantage of the reputation attached to the trademarks in issue. [3]
Copyrights and related rights
Copyright is concerned with the protection of literary and artistic works.
Copyright is therefore a property right, which subsists in various works,
for example literary works, artistic works, musical works, sound recordings
films and broadcast. Copyright gives the owner of a work that is protected
by copyright the exclusive right to do certain things in relation to the which
include but are not limited to making a copy, broadcasting or giving a public
performance. Anyone else who does any acts restricted by copyright without
the permission of the copyright owner may be subject to legal action taken
by the owner of the copyright for copyright infringement. However, ownership
of copyright is alienable and it can be transferred to another or a licence
may be granted by the owner to another, permitting him to do one or more specified
acts with the work in question. [2]
Copyright does not protect an idea; it is the expression of an idea that is
protected i.e. a tangible form – painting, book etc.
International protection of copyright works is affected mainly through two
international conventions i.e. the Berne Copyright Convention [4] and the
Universal Copyright Convention [5]. The United Kingdom is a member of both
conventions. Both conventions lay down minimum standards of protection to
be attained and reciprocity of protection between member countries. The conventions
have been responsible for the high level of harmony that now exist on the
world stage. Therefore because of agreements under the conventions it is possible
for a foreign citizen to take legal action in the United Kingdom for copyright
infringement occurring there, as if he or she was a British citizen. The author
of copyright is the person who creates the work in which copyright subsists,
however, for some type of works, the author is the person by whom the arrangements
necessary for the creation of the work are undertaken i.e. an employer. [2]
Patents
A patent is a monopoly right to the exclusive use of an invention and can
last for a maximum of 20 years. A patent is a property, which like any other
business commodity, may be bought, sold, hired or licensed.
Generally the purpose of a patent is to provide a form of protection for technological
advances. The idea is to provide a reward not only for the creation of an
invention, but also for the development of an invention to the point at which
in is technologically feasible and marketable. The protection and reward is
also aimed at promoting additional creativity and encourage companies to continue
their development of new technology to the point at which it is marketable,
useful to the public and desirable for the public good.
To obtain patent protection the applicant must also show proof of the following:
That the invention is new or novel. The invention should be capable of being
considered a new solution of a technological problem. However, there is no
requirement for the invention to be represented in a physical embodiment.
That it is non – obvious, that is to say, it must involve an inventive
step. The invention must be enough of an advancement to be considered non
– obvious by a person having ordinary skills in the art over the state
of technology before the invention.
That it is useful, that the invention should be capable of industrial application.
[2] The invention must be able to be used on a certain scale in practice i.e.
exploitable in industry.
Not all inventions are patentable, to be able to obtain a patent, the applicant
must proof that the invention concerns the composition, construction or manufacture
of a substance, article or apparatus, or with an industrial type of process,
as distinct from artistic creations.
Some categories of inventions are specifically excluded from patentability.
These include the following:
Things that exist in nature, which are discovered and not invented,
Machines that defy the laws of natureScientific theory,
Mathematical methods,
Schemes, rules or methods, such as those for doing business, performing purely
mental acts or playing games,
Methods for medical treatment for humans or animals or diagnostics methods,
however, products used in making diagnostics are patentable.
The advantages of taking out a patent are the rights granted the patent owner
by law to exclude all others in the territory covered by the patent from making,
using, selling or importing the invention. This however, does not give the
inventor or the owner of the patent the right to use the invention if it’s
use is illegal. The inventor or the owner of a patent can prevent others from
marketing and profiting from the invention for a period of 20 years from the
date on which the application is filed. What this right, granted by the law
to the owner of the patent does is give the developer of the technology the
right to have it to himself for 20 years in exchange for full disclosure to
the public of how to use it. When the patent expires, the technology becomes
public property, and the public is free to use it. [2]
Patent protection can be obtained and enforceable only on a country-by-country
basis with the exception of some regional arrangements that permit a regional
protection such the European Patent Organisation. [6]
There is also an International Agreement administered by the World Intellectual
Property Organisation (WIPO), called the Patent Cooperation Treaty (PCT) for
the filing, searching, publication and examination of international applications.
However, the Patent Cooperation Treaty only makes it easier to obtain patents
in the Contracting States by providing for the filing of one international
application, which may be subsequently prosecuted in the different designated
National or Regional Offices of the States party to the Patent Cooperation
Treaty. The granting of patent protection in the respective countries designated
in the international application is left to the respective designated Offices.
They would require the applicant of the international application to enter
a regional phase in the designated Offices concerned and to pay the relevant
filing and maintenance fees, with the only exceptions being that the date
when the international application was made would be considered as the official
filing date and the application will not be re-examined for novelty, inventive
step and industrial applicability. The designated Offices will take the filing,
search, examination and publication of the international application into
consideration. [7]
There is unfortunately no single world patent. Filing, examination, granting
of protection, maintenance and the payment of the relevant fees, and enforcement
of infringement have to be done on a country-by-country basis. This is generally
not only very expensive but is also a very difficult thing to do. Mere failure
to pay yearly maintenance fee in one country will cause the patent to lapse
in that country, meaning any one in that country is free to use it as he or
she pleases. With the advent of the Internet, patent disclosure could now
be done on the Internet; this would mean a global disclosure of the invention,
with all its direct and indirect consequences. Therefore a person who is resident
in any country in the world in which the owner of the invention has not been
able to seek and obtain protection of the invention can easily have access
to a full disclosure through the Internet and proceed to exploit the invention
without the consent of the owner of the invention. Worst still he or she may
wish to use the knowledge acquired from the disclosure to obtain patent protection
in his or her country of residence without the consent or even the knowledge
of the rightful owner of the invention. This posses major problems both for
intellectual property in general and patent protection in particular.
This project is aimed at attempting an analysis of some of these problems
and providing guidelines for companies involved in on-lines businesses and
owners of intellectual property rights in general and patents in particular
on how to identify and deal with these problems.
Aims of this project
The use of electronic transactions through the Internet which
provide a global medium, not in any manner limited by territorial boundaries
is increasingly posing serious problems for acquisition, exploitation and
enforcement of well known forms of intellectual property rights which are
enshrined in different pieces national legislations and international conventions.
The main aims of this project are:
Undertake an analysis of the impact of electronic Commerce transactions
on some forms of intellectual property rights i.e. trademarks, domain names,
copyright and related rights and patents.
Provide guidelines for companies involved or wishing to set up on-line businesses,
on how to identify and handle issue s relating to intellectual property.
To critically appraise the problems and conflicts experienced in the on-line
business community as a result of the overlap between the utilisation of the
medium provided by the Internet for on-line businesses to access global markets
at minimal cost and the legal and regulatory restrictions imposed on them
by national legislations and international conventions that accord protection
to owners of intellectual property rights such as trademarks, copyright and
related rights and patent law.
To attempt to provide guidelines on the level of legal compliance required
of on-line businesses by national legislations and international conventions
dealing with intellectual property law. Compliance will be accessed on the
lines of remedies and recommendations so far provided by the world Intellectual
Property Organisation (WIPO) [8].
Problems and difficulties brought about by the coexistence between traditional intellectual property rights and electronic commerce.
BACKGROUND
Electronic Commerce has brought along profound changes in many
if not all areas of life. It has had an extraordinary impact on the architectonics
of markets and regulatory structures. Some of the highly challenging and hotly
debated issues cut across different sectors of legal interest both at national
and international levels. Also the international dimensions of electronic
commerce complicate the development of solutions to the various legal subjects
affected by e-Commerce at national level. This is due to the extra caution
of not ignoring potential cross-border impacts. Although the Intellectual
Property field is the most affected by electronic commerce, changes brought
about by electronic commerce also have far reaching implications for other
areas of law and policy. Some of these issues include but are not limited
to Paperless Environment Electronic Contracts, The Internet Jurisdictions
and Applicable law and Digital Technology Issues of Enforcement and Privacy.
PROBLEMS
E-Commerce and Intellectual Property law
In view of the vast and ever expanding nature of the impact of electronic
commerce on the above-cited areas of law and policy, I will for the purposes
of this project be limiting myself to the impact of electronic commerce on
the intellectual property field. My focus is on examining problems and difficulties
brought onto the traditional legal systems in general and intellectual property
law in particular by the international and global character of electronic
commerce. While traditional legal systems and intellectual property law are
based on notions of sovereignty and territoriality, the Internet on contrast
largely ignores these notions. This dissertation addresses the impact of the
digital economy in general and electronic commerce in particular on the intellectual
property system, namely, trademarks, copyright and related rights, patents,
and domain names. Each of these intellectual property disciplines is currently
confronted with new issues generated by the emergence of the Internet and
electronic commerce. Each of them is now bound to coexist with the rapidly
expanding practice of electronic commerce. As would normally be expected this
coexistence is not without problems.
Coexistence between electronic commerce and trademarks
The use of trademarks in the content of web sites
Although there has been growing tension as to whether or not a trademark should
be registered as a domain name by an on-line business, person or company that
is not the owner of the trademark, it can be argued that it is the use made
of domain names, and the content of Web sites, which can lead to more infringements
and not just registration i.e. registration in itself does not prevent infringement.
For example once content is well established and referenced properly by search
engines, customers or users will usually arrive at Web site containing the
alleged infringing material i.e. trademark or even domain name without using
or even noticing the existence of the Domain name.
This therefore is a serious problem for owners of intellectual property rights
such as trademarks who are trying to avoid or check infringements of their
intellectual property rights over the Internet. In some cases this would mean
policing the content of all suspected Web sites on the Internet.
Even if any infringement were found the second and most important problem
would be how to enforce such a right, not withstanding problems related to
territorial jurisdictions, given that the infringing Web site’s location
might not even be known by the owner of the infringed intellectual property
right and even if known the intellectual property right infringed might not
be registered in the jurisdiction in which there is infringement. Worst still
it is not certain whether the insertion of the alleged intellectual property
right in the content of the Web site would legally be considered as an infringement
under the relevant legal system under consideration.
The use of trademarks as links to web sites
The use of trademarks as links on Web sites also posses a serious threat of
abuse and infringement of the rights of owners of trademarks i.e. it could
lead to confusion and or dilution of the registered trademark or enable the
owner of the Web site on which the link is created to take undue advantage
of the trademark.
Electronic commerce is closely linked to the Internet. Internet technology
is based on hypertext links from one Web site to another, allowing the user
to glide smoothly from one set or form of information to another. Usually
in creating links the names of companies or trademarks of companies are used
on the site on which the link is created. This kind of usage may take many
forms i.e. it can be part of the Uniform Resource Locator or may be the actual
registered logo or device of a particular business. Owners of intellectual
property rights would also be keen in policing the Internet for this kind
of usage so as to make sure that whenever, their trademark is used as a link
on other Web sites, it is not used in such a way as to render it generic and
therefore losing it’s value as a trademark or cause confusion or take
undue advantage of the reputation of the trademark.
The use of trademarks as META TAGS
META TAGS provides one of the most used form through which intellectual property
rights in general and trademarks in particular are infringed on the Internet.
A Meta tag is hidden information within a Web site that broadly contains a
synopsis of the information contained in the Web site, either in the form
of single words, or as sentences. It contains for example all the important
words that could be used to search for pages. The information in Meta tags
is used mostly by search engines to search how highly the search for a particular
term matches the content in the page. Search engines work by sending out spiders
to crawl over information in the web and index web pages. A database is then
created consisting of a list of words and information on where the words are
to be found. The hits are usually rated with the highest scoring hits displayed
at the top of the list of hits found by the search engine. If a word is found
in the Meta tags it is likely to be rated by the search engine as more relevant
and so displayed more prominently in the search result.
Because of the popularity of trademarks, some businesses have been known to
use trademarks both registered and unregistered belonging to others in their
Meta tags in order to generate business.
The use of Meta tags provides a means for possible trademark infringement
and even enables the infringing user to hide the trademark so that it does
not appear on his Web site but yet is available for identification by search
engines. It is however, possible for a diligent trademark owner to identify
hidden usage of his trademark. He can for example search for the trademark
by using search engines, and then note the Web sites on which the trademark
does not visibly appear. Once he finds the pages with the use of the search
engine, he can then view the HTML version of the pages by using the view option
on his browser in order to see the terms included in the meta tags i.e. the
hidden trademark.
The use of trademarks in e-mails messages
Electronic mailing is also being used to infringe intellectual property rights
in general and trademarks in particular. Using trademarks to send Spam e-mail,
and therefore falsely indicating that the e-mail emanated from the trademark
owner is now a very common form of trademark infringement on the Internet.
This posses a serious problem for trademark owners given that their trademarks
can be used by third parties to their own advantage and also to destroy the
reputation of the rightful owner in the public eye by giving recipients of
unauthorized junk e-mail (pornography) the impression that it was sent to
them by the trademark owner i.e. hotmail.com or American Online etc. when
in fact it is not
The sale of trademarks by search engines – advertisement.
One of the most recent developments in the trademark infringement on the Internet
relates to the ways, which search engines work and display advertisements.
For example when one types a word into the search engine, banner advertisements
automatically appear on the site, most of the times advertising a competitor’s
products. The search engine sites make advertising revenue from this form
of activity i.e. they sell certain search terms to the highest bidder. When
such terms are trademarks the owners of such trademarks contest such use and
argue that such practices amount to an infringement of their trademark rights.
Coexistence between electronic commerce and domain names
Domain names are often confused with electronic mail addresses or address
references on the World Wide Web, commonly known as Universal Resource Locators
(URL). Domain names form a key part of both an e-mail address and a Universal
Resource Locator. For example “sbu.ac.uk” is the domain name in
both the electronic mail address chengus@sbu.ac.uk and in the Uniform Resource
Locator www.sbu.ac.uk.
Domain names are registered in a hierarchical system with a limited number
of country code and generic Top Level Domains.
These Top Level Domains are then divided into Second Level Domains, which
are further divided into Third Level Domains and so on all in a tree-like
structure. At each level of the tree, a computer called a name server is operated
to maintain a table of all the names registered under the level. The name
server operator has as principal responsibility to direct all enquirers to
the desired name on the name server.
Therefore when an Internet user in the United States of America makes a request
to view the South Bank University website i.e. www.sbu.ac.uk he is first of
all rooted on the World Root (name server) to establish the address of the
.uk Top Level Domain server. A subsequent request is then made to the .uk
server for the address of the .ac.uk server. A further request at the .ac.uk
server for the address of the sbu.ac.uk server will then link the user to
www.sbu.ac.uk and enable him to view the content of the desired address and
then to link on the other pages of the South Bank University by using the
links provided in the content of www.sbu.ac.uk
Over the years and with the rapid expansion of electronic commerce, on-line
businesses have because of the obvious marketing and business advantages strongly
attached a lot of importance on using words that are associated with the goodwill
or popularity of their business such as their business names or their trademarks
as part of their domain names. They have also for the same reasons taken positive
measures to claim ownership of words that are associated with their businesses
and to enforce their rights over such words by stopping other people from
taking undue advantage through the use of such words as part of their domain
names. This has given raise to clashes between on-line business over a series
of issues concerning domain names such as; the legal significance of a domain
name registration, cybersquatting and the quest for a clear cut legal solution
to the clashes between the rights protected under the notions of domain names
and trademarks.
Coexistence between electronic commerce and copyright and related rights
The purpose of this section would be to examine the various forms of practices
that are disallowed on grounds of infringement of copyright or related rights
in the light of the WIPO Copyrights Treaties and the European Copyright and
E-Commerce Directives. It will also examine the liability of Internet Service
Providers.
The rapid development of the Internet and the prospects of the information
super highway, world – wide telecommunication systems which permit the
rapid, indeed virtually instantaneous, transmission of information and entertainment
in all media – print, pictures (still and moving) sound and combinations
thereof now posses the biggest ever threat on the existence of copyrights.
The question now being asked by many owners of copyrights, as well as legal
critics is whether the ease of perfect reproduction and manipulation of material
in the digital form currently being used by advanced communication systems
and the continuous improvement of technology in this area will eventually
lead to a fundamental change in copyright law. Also given the almost instantaneous
flow of copyright protected material across national boundaries, the intensification
of international harmonization of copyright laws is now of major concern to
all stakeholders in the area of copyright. However, it should be noted that
a large amount of copyright material is placed on the Internet by its authors
so that it can be accessed and used freely by others. This is common with
government, commercial and other organisations and individuals that wish to
draw the attention of others to themselves and their products and to freely
provide information about the copyright material to the public. The reasons
for such free offers are many and varied i.e. on-line marketing with the aim
of acquiring and maintaining customers. As a general principle the existence
or otherwise of copyright in what is placed on the Internet will be of no
or very little relevance to parties that whose aim is to provide free advertisement
of their products or services. Such Internet publication may either contain
express permission to access, use and reproduce, or such permission can be
implied from the circumstances in which the material is made available.
This is unfortunately not true in all cases. Many people or institutions that
publish material on the Internet consider the Internet as a medium of publication
and expect that the copyright in the material so published would be protected.
To these group of people copyright helps to make a market that would otherwise
be limited to those who were unaware of their rights or abilities to copy
and is in other words, a vital strand in the creation of a legal environment
appropriate for electronic commerce, just as it has always been for those
whose business is the creation and publication of entertainment and information
products in analogue form such as books, records and films. Therefore, author,
designers and publishers of digital material such as scripts and codes for
web sites are a new class of owners of intellectual property rights i.e. copyrights
with the same rights over their works as an author or a publisher will have
over a book.
My main concern with copyright as it relates to electronic commerce is to
investigate the protection which the creator of a website is accorded under
copyright law. I have also considered the position if the creator of a website
has infringed someone else’s copyright in assembling or designing his
or her website. The laws protecting the copyright of the creator of a website
are the same as the laws protecting copyright in any other kinds of works
in which copyrights subsists. For the purpose of this section, I will use
the laws of the United Kingdom as examples.
The main piece of legislation in the United Kingdom on copyright is the Copyright
Designs and Patents Act 1988 as amended (CDPA) [9]. Under section 16(1) of
this Act there are now 6 main exclusive rights arising from ownership of copyright
in any protected work. These are as follows; copying, issuing copies of the
work to the public, renting or lending the work to the public, performing,
showing or playing the work in public, broadcasting the work or including
it in a cable programme service and making an adaptation of the work. Section
16(2) of the same Act further provides that any person who without right to
do so authorises another to do any of the above acts is himself and infringer
as well. Section 16 (3) of the Act precise that acts of infringement may be
in relation to the whole of the work or to any substantial part of it. Measuring
the substance of what has been taken depends much more on the quality than
on the quantity. It follows therefore that if the acts are shown to have been
in relation to an insubstantial part of a work then, there is no infringement.
The question that I find relevant to owners of on-line businesses or persons
involve in electronic commerce that is my main concern in this project is
to find out the effect of the various forms of exclusive rights attributable
to owners of copyright material in relation to activities on the Internet.
COPYING
Section 17 (2) of the Copyright Design and Patent Act 1988 as amended makes
it clear that copying in relation to literary, dramatic, musical and artistic
works means reproduction of the work in any material form and includes storage
of the work in any medium by electronic means as well as making of copies
that are transient or incidental to some other use of the work. This is generally
accepted as covering the loading of software into a computer’s RAM and
therefore readily extended to the user on the Internet who calls up a web
page on a computer screen. Theoretically it also covers the reproduction which
occurs on the various computers and servers through which the web page travels
as it finds it’s way across the networks to the user’s machine,
although if this is not allowed it has the remarkable result that the technical
basis of the operation of the Internet itself is illegal. The concept of transient
reproduction also embraces activities such as proxy server caching, where
by deploying appropriate software technology Internet service providers, librarians,
archivists and others make and store on their own servers temporary and regularly
updated copies of materials contained on other servers with the purpose of
making the information more readily available to their own clients by avoiding
congestion at the “live” site. These kind of operations may also
amount to the infringing act of storage by electronic means [10].
Consequently there seems to be no doubt, that under the present United Kingdom
(UK) law browsing and caching are infringements of copyright unless either
there is some form of licence for that act or it can be brought under one
of the statutory permitted acts. Since downloading material from a website
leads to the production of a fixed and not transient copy, i.e. whether in
digital form in one’s computer or floppy disk, or as a hard copy by way
of a printout, it is more readily recognised in most legal systems as an infringing
reproduction.
Issuing copies of the work to the public.
Section 18 of the CDPA 1988 defines issuing to the public as putting copies
into circulation for the first time. This right is however, exhausted by initial
sale. The “on demand” nature of the Internet does not look much
like the issue of copies to the public, although it might be seen as a form
of circulation. The reason for this position is based on the fact that Section
I8 of the CDPA 1988 which deals with making copies to the public unlike Section
17 which deals with copying does not make any mention or reference to the
notion of “transient copy”. Therefore the copies required for the
purposes of Section 18 may therefore be limited to those which are non-transient,
which would go beyond mere on – demand transmission. It therefore follows
that a user who accesses material and passes it on to another user is not
guilty of infringement under Section 18 so long as the transmission is electronic.
Rental or Lending of a work to the Public
Section 18 A (2)(a) of the CDPA 1988 defines rental as making a copy of a
work available for use, on terms that it will or may be returned for direct
or indirect economic or commercial advantage. i.e. videos or games rental
stores. Section 18 A (2)(b) of the CDPA 1988 provides a similar definition
for the notion of lending except that unlike with rental the restricted act
is performed otherwise than for direct or indirect economic or commercial
advantage, and is carried out through an establishment which is accessible
to the public. A good example is a library that operates a Public Lending
Rights scheme. Also it is important to note that according to Section 18 A
(3) of the CDPA 1988, rental and lending do not cover making copies available
for the purpose of performance, showing, playing or exhibiting in public or
for the purpose of on – the – sport reference use.
The question of main concern to the project as regards rental and lending
rights is to find out whether they are applicable to Internet activities.
Like with copying, there are again difficulties because of the use of the
concept of a “copy”, which is what must be made available, and this
is further underlined by the expectation that the copy will be returned. This
makes it difficult to fit in with the ordinary usages of the Internet. The
requirement that for rental some sort of economic or commercial advantage
is necessary while for lending there must be an establishment accessible to
the public is not easily applicable in the context of normal Internet services.
Also the browser or user on the Internet may be said to be making an on-the-sport
reference use of the service, which would mean that the provider was not engaging
in rental or lending activities. A further discussion of rental and lending
restrictions as they apply to the Internet can be found in the, the European
Community (EC) Directive on Rental and Lending Rights and on Piracy [11]
Public performance, showing or playing
Section 19 (2)(b) of the CDPA 1988 defines performance to cover any mode of
virtual or acoustic presentation, including by means of a cable programme.
There is nothing in this definition that prevents an unauthorised display
on a computer screen of the texts of a literary work being a “performance”
of that work, and thus constituting infringement provided that it takes place
in public. In the case of sound recordings, films, broadcasts and cable programmes,
the equivalent form of infringement is playing or showing the work in public
[12]. What would prevent this form of infringement from being of much relevance
to the Internet, at least in it’s present pattern of usage, is merely
the fact that most displays of material do not take place in public. Therefore
if a display of such material can be proven to constitute a public display
then it would constitute copyright infringement if done without the consent
of the copyright owner. It should also be noted that the definition of “public”
for this particular copyright purpose is very wide [13]. Therefore the decision
of the Spanish Supreme Court in the case of Telstra Corporation Ltd. against
Australasian Performance Right Association Ltd. [14] that the non-simultaneous
transmission of copyright material to different persons in individual hotel
bedrooms require copyright licences is likely going to be the position to
be adopted by many other jurisdictions . Gathering together is therefore most
likely not going to be required in order to proof a public performance.
Broadcasting or inclusion in a cable programme service
Neither accessing a website nor incorporation of other people’s copyright
material thereon can constitute broadcasting, since broadcasting is a wireless
technology. However, a question which is of direct relevance is whether enabling
a user of one website to link to another site means that the second website
is included within the first site or whether the two are simply connected
but otherwise independent sites. If they are not independent sites then infringement
can be established. For example in has been suggested that the concept of
inclusion is apt to catch the situation where one website is linked to another
but the first site continues in view on screen by way of a “frame”
around the image from the second site [15].
Authorisation to infringe – Internet Service Provider’s
liability
Section 16(2) of the CDPA 1988 as amended provides that authorisation of another
to infringe any form of copyright is itself infringement. Authorisation is
understood to mean sanctioning, approving or countenancing where there is
authority or control over those who actually infringe. This form of liability
is of obvious relevance to undertakings of businesses such as Internet service
providers, universities and other bodies including companies, which set up
the facilities on which infringing Internet activity take place. The questions
whether such bodies are liable will depend mainly on whether they give express
warning to users or customers against use of the equipment for infringing
copyright. Therefore in the cases of CBS Inc. v Ames Records & Tapes Ltd.
and SBS Songs Ltd v Amstrad Consumer Electronics Plc. it was held that commercial
libraries renting out sound recordings and manufacturers of double-headed
audio tape decks were not liable despite the fact that their services and
products rendered infringement easy and probable [16]. In contrast, in Moorehouse
v University of New South Wales, the university which provided photocopying
facilities for staff and students in it’s library was found to have authorized
infringement of copyright because it had taken no steps to deter such activity.
[17]
The appropriate measure of liability for those who provide Internet facilities
such as the Napster indices, or machinery such as Rio MPMan player, which
enable members of the public to use and enjoy material obtained from the Internet,
therefore appears to be whether or not they took measures to keep users aware
of the existence of copyright and warned against its abuse either by putting
material on the service or downloading it.
Coexistence between electronic commerce and patents
The patent system has played a vital role in promoting the development of
the underling technical infrastructure for electronic commerce. Electronic
commerce relies principally on the various computer and network technologies,
both hardware and software. The market exclusivity provided by the patent
protection system has provided a reward for investment and has justified the
expenditure in research and development to achieve further technological progress.
However, the new technologies notably the Internet now pose challenges to
the conventional legal scheme for patent protection. This will be illustrated
by examining some of the many issues associated with digital media and electronic
commerce in the context of patent protection.
As noted in chapter 1, patents are granted only to inventions that are novel,
involve an inventive step and are useful or industrially applicable. The general
rule is that to determine if the requirements of novelty and inventive step
are met, the claimed invention is compared with the existing state of the
art. The existing state of the art is also referred to as prior art. Prior
art or existing art, in electronic form, which exists in cyberspace i.e.,
published only on the Internet, raises serious questions as to its availability
as “prior art” and thus whether it can be applied against an invention
for which a patent is sought in determining novelty or inventive step. The
questions include, whether that kind of information has become prior art even
if it was disclosed on the Internet for only a limited time. Although similar
questions have been addressed with respect to prior art published on papers,
publication on the Internet may have different implications. Authenticity,
veracity and integrity are the critical issues for prior art in cyberspace,
because cyber art is considered to be more vulnerable to alterations and modification.
The determination of the timing of the disclosure and accessibility of the
cyber art to the public, given the networks ‘s capacity for instantaneous
dissemination on the international scale, is another major concern. Furthermore,
national laws may extend the concept of the prior art to include prior uses.
Under such national laws the concept of use of prior art in electronic form
will pose problems. Also the above-mentioned questions can also be extended
to cover the context of a grace period for public disclosure of an invention
before filing a patent application.
Many countries as well as Organisations will have to make modifications to
their patent laws in order to cover the problems pose by electronic commerce.
For example Japan recently amended its patent law to expressly provide that
an invention which was made publicly available online, for example via the
Internet, prior to the filing of an application for a patent would constitute
a novelty defeating bar. The amendment was also extended to cover, the problem
posed by the six months grace period by expressly providing that an invention
that was publicly disclosed online would fall within the six-month grace period
providing an exception to novelty-destroying disclosures. These amendments
to Japan’s patent law became enforceable in January 1, 2000 [18]. Japan’s
example is likely going to be followed by many other jurisdictions.
The Internet also raises complex jurisdictional issues as regards patent protection.
Conventionally patent protection is provided on a country-by-country basis
and the therefore the patent laws of each country or region are enforceable
only within the borders covered by the laws in question. However, electronic
commerce now provides a means by which patented software for example can be
sold and delivered over the Internet internationally. Any infringement action
for such a patent would therefore be confronted with serious jurisdictional
and choice of law issues. Worst still the first practical issue may be that
of even detecting or identifying the infringement of such a patent, given
that the unauthorized importation of such a software by means of the Internet,
unlike the importation of tangible goods, cannot be detected and stopped by
the custom or trading standards authorities.
Other questions particular to patent protection on the Internet may arise
in the case where a patented product invention consists of elements that are
physically located in different territories. For example in the case of process
patents, for a method or process, distinct elements in the claimed process
could be performed in different territories. If an alleged infringer operates
a system containing all the claimed elements within the territory in which
the invention is protected i.e. in the United Kingdom, there would be a straightforward
claim / case for infringement. However, the questions of infringement and
jurisdiction would be more difficult where a patented invention involves activities
in several countries by several individuals. Given this situation, it may
not be clear in which jurisdiction the accused infringers are actually using
the patented invention. [19]
Coexistence between electronic commerce
and trademarks
The use of trademarks in the content of web sites
Although there has been growing tension as to whether or not a trademark should
be registered as a domain name by an on-line business, person or company that
is not the owner of the trademark, it can be argued that it is the use made
of domain names, and the content of Web sites, which can lead to more infringements
and not just registration i.e. registration in itself does not prevent infringement.
For example once content is well established and referenced properly by search
engines, customers or users will usually arrive at Web site containing the
alleged infringing material i.e. trademark or even domain name without using
or even noticing the existence of the Domain name.
This therefore is a serious problem for owners of intellectual property rights
such as trademarks who are trying to avoid or check infringements of their
intellectual property rights over the Internet. In some cases this would mean
policing the content of all suspected Web sites on the Internet.
Even if any infringement were found the second and most important problem
would be how to enforce such a right, not withstanding problems related to
territorial jurisdictions, given that the infringing Web site’s location
might not even be known by the owner of the infringed intellectual property
right and even if known the intellectual property right infringed might not
be registered in the jurisdiction in which there is infringement. Worst still
it is not certain whether the insertion of the alleged intellectual property
right in the content of the Web site would legally be considered as an infringement
under the relevant legal system under consideration.
The use of trademarks as links to web sites
The use of trademarks as links on Web sites also posses a serious threat of
abuse and infringement of the rights of owners of trademarks i.e. it could
lead to confusion and or dilution of the registered trademark or enable the
owner of the Web site on which the link is created to take undue advantage
of the trademark.
Electronic commerce is closely linked to the Internet. Internet technology
is based on hypertext links from one Web site to another, allowing the user
to glide smoothly from one set or form of information to another. Usually
in creating links the names of companies or trademarks of companies are used
on the site on which the link is created. This kind of usage may take many
forms i.e. it can be part of the Uniform Resource Locator or may be the actual
registered logo or device of a particular business. Owners of intellectual
property rights would also be keen in policing the Internet for this kind
of usage so as to make sure that whenever, their trademark is used as a link
on other Web sites, it is not used in such a way as to render it generic and
therefore losing it’s value as a trademark or cause confusion or take
undue advantage of the reputation of the trademark.
The use of trademarks as META TAGS
META TAGS provides one of the most used form through which intellectual property
rights in general and trademarks in particular are infringed on the Internet.
A Meta tag is hidden information within a Web site that broadly contains a
synopsis of the information contained in the Web site, either in the form
of single words, or as sentences. It contains for example all the important
words that could be used to search for pages. The information in Meta tags
is used mostly by search engines to search how highly the search for a particular
term matches the content in the page. Search engines work by sending out spiders
to crawl over information in the web and index web pages. A database is then
created consisting of a list of words and information on where the words are
to be found. The hits are usually rated with the highest scoring hits displayed
at the top of the list of hits found by the search engine. If a word is found
in the Meta tags it is likely to be rated by the search engine as more relevant
and so displayed more prominently in the search result.
Because of the popularity of trademarks, some businesses have been known to
use trademarks both registered and unregistered belonging to others in their
Meta tags in order to generate business.
The use of Meta tags provides a means for possible trademark infringement
and even enables the infringing user to hide the trademark so that it does
not appear on his Web site but yet is available for identification by search
engines. It is however, possible for a diligent trademark owner to identify
hidden usage of his trademark. He can for example search for the trademark
by using search engines, and then note the Web sites on which the trademark
does not visibly appear. Once he finds the pages with the use of the search
engine, he can then view the HTML version of the pages by using the view option
on his browser in order to see the terms included in the meta tags i.e. the
hidden trademark.
The use of trademarks in e-mails messages
Electronic mailing is also being used to infringe intellectual property rights
in general and trademarks in particular. Using trademarks to send Spam e-mail,
and therefore falsely indicating that the e-mail emanated from the trademark
owner is now a very common form of trademark infringement on the Internet.
This posses a serious problem for trademark owners given that their trademarks
can be used by third parties to their own advantage and also to destroy the
reputation of the rightful owner in the public eye by giving recipients of
unauthorized junk e-mail (pornography) the impression that it was sent to
them by the trademark owner i.e. hotmail.com or American Online etc. when
in fact it is not
The sale of trademarks by search engines – advertisement.
One of the most recent developments in the trademark infringement on the Internet
relates to the ways, which search engines work and display advertisements.
For example when one types a word into the search engine, banner advertisements
automatically appear on the site, most of the times advertising a competitor’s
products. The search engine sites make advertising revenue from this form
of activity i.e. they sell certain search terms to the highest bidder. When
such terms are trademarks the owners of such trademarks contest such use and
argue that such practices amount to an infringement of their trademark rights.
Coexistence between electronic commerce and domain names
Domain names are often confused with electronic mail addresses or address references on the World Wide Web, commonly known as Universal Resource Locators (URL). Domain names form a key part of both an e-mail address and a Universal Resource Locator. For example “sbu.ac.uk” is the domain name in both the electronic mail address chengus@sbu.ac.uk and in the Uniform Resource Locator www.sbu.ac.uk.
Domain names are registered in a hierarchical system with a limited number of country code and generic Top Level Domains.
These Top Level Domains are then divided into Second Level Domains,
which are further divided into Third Level Domains and so on all in a tree-like
structure. At each level of the tree, a computer called a name server is operated
to maintain a table of all the names registered under the level. The name
server operator has as principal responsibility to direct all enquirers to
the desired name on the name server.
Therefore when an Internet user in the United States of America makes a request
to view the South Bank University website i.e. www.sbu.ac.uk he is first of
all rooted on the World Root (name server) to establish the address of the
.uk Top Level Domain server. A subsequent request is then made to the .uk
server for the address of the .ac.uk server. A further request at the .ac.uk
server for the address of the sbu.ac.uk server will then link the user to
www.sbu.ac.uk and enable him to view the content of the desired address and
then to link on the other pages of the South Bank University by using the
links provided in the content of www.sbu.ac.uk
Over the years and with the rapid expansion of electronic commerce, on-line
businesses have because of the obvious marketing and business advantages strongly
attached a lot of importance on using words that are associated with the goodwill
or popularity of their business such as their business names or their trademarks
as part of their domain names. They have also for the same reasons taken positive
measures to claim ownership of words that are associated with their businesses
and to enforce their rights over such words by stopping other people from
taking undue advantage through the use of such words as part of their domain
names. This has given raise to clashes between on-line business over a series
of issues concerning domain names such as; the legal significance of a domain
name registration, cybersquatting and the quest for a clear cut legal solution
to the clashes between the rights protected under the notions of domain names
and trademarks.
Coexistence between electronic commerce
and copyright and related rights
The purpose of this section would be to examine the various forms of practices
that are disallowed on grounds of infringement of copyright or related rights
in the light of the WIPO Copyrights Treaties and the European Copyright and
E-Commerce Directives. It will also examine the liability of Internet Service
Providers.
The rapid development of the Internet and the prospects of the information
super highway, world – wide telecommunication systems which permit the
rapid, indeed virtually instantaneous, transmission of information and entertainment
in all media – print, pictures (still and moving) sound and combinations
thereof now posses the biggest ever threat on the existence of copyrights.
The question now being asked by many owners of copyrights, as well as legal
critics is whether the ease of perfect reproduction and manipulation of material
in the digital form currently being used by advanced communication systems
and the continuous improvement of technology in this area will eventually
lead to a fundamental change in copyright law. Also given the almost instantaneous
flow of copyright protected material across national boundaries, the intensification
of international harmonization of copyright laws is now of major concern to
all stakeholders in the area of copyright. However, it should be noted that
a large amount of copyright material is placed on the Internet by its authors
so that it can be accessed and used freely by others. This is common with
government, commercial and other organisations and individuals that wish to
draw the attention of others to themselves and their products and to freely
provide information about the copyright material to the public. The reasons
for such free offers are many and varied i.e. on-line marketing with the aim
of acquiring and maintaining customers. As a general principle the existence
or otherwise of copyright in what is placed on the Internet will be of no
or very little relevance to parties that whose aim is to provide free advertisement
of their products or services. Such Internet publication may either contain
express permission to access, use and reproduce, or such permission can be
implied from the circumstances in which the material is made available.
This is unfortunately not true in all cases. Many people or institutions that
publish material on the Internet consider the Internet as a medium of publication
and expect that the copyright in the material so published would be protected.
To these group of people copyright helps to make a market that would otherwise
be limited to those who were unaware of their rights or abilities to copy
and is in other words, a vital strand in the creation of a legal environment
appropriate for electronic commerce, just as it has always been for those
whose business is the creation and publication of entertainment and information
products in analogue form such as books, records and films. Therefore, author,
designers and publishers of digital material such as scripts and codes for
web sites are a new class of owners of intellectual property rights i.e. copyrights
with the same rights over their works as an author or a publisher will have
over a book.
My main concern with copyright as it relates to electronic commerce is to
investigate the protection which the creator of a website is accorded under
copyright law. I have also considered the position if the creator of a website
has infringed someone else’s copyright in assembling or designing his
or her website. The laws protecting the copyright of the creator of a website
are the same as the laws protecting copyright in any other kinds of works
in which copyrights subsists. For the purpose of this section, I will use
the laws of the United Kingdom as examples.
The main piece of legislation in the United Kingdom on copyright is the Copyright
Designs and Patents Act 1988 as amended (CDPA) [9]. Under section 16(1) of
this Act there are now 6 main exclusive rights arising from ownership of copyright
in any protected work. These are as follows; copying, issuing copies of the
work to the public, renting or lending the work to the public, performing,
showing or playing the work in public, broadcasting the work or including
it in a cable programme service and making an adaptation of the work. Section
16(2) of the same Act further provides that any person who without right to
do so authorises another to do any of the above acts is himself and infringer
as well. Section 16 (3) of the Act precise that acts of infringement may be
in relation to the whole of the work or to any substantial part of it. Measuring
the substance of what has been taken depends much more on the quality than
on the quantity. It follows therefore that if the acts are shown to have been
in relation to an insubstantial part of a work then, there is no infringement.
The question that I find relevant to owners of on-line businesses or persons
involve in electronic commerce that is my main concern in this project is
to find out the effect of the various forms of exclusive rights attributable
to owners of copyright material in relation to activities on the Internet.
COPYING
Section 17 (2) of the Copyright Design and Patent Act 1988 as amended makes
it clear that copying in relation to literary, dramatic, musical and artistic
works means reproduction of the work in any material form and includes storage
of the work in any medium by electronic means as well as making of copies
that are transient or incidental to some other use of the work. This is generally
accepted as covering the loading of software into a computer’s RAM and
therefore readily extended to the user on the Internet who calls up a web
page on a computer screen. Theoretically it also covers the reproduction which
occurs on the various computers and servers through which the web page travels
as it finds it’s way across the networks to the user’s machine,
although if this is not allowed it has the remarkable result that the technical
basis of the operation of the Internet itself is illegal. The concept of transient
reproduction also embraces activities such as proxy server caching, where
by deploying appropriate software technology Internet service providers, librarians,
archivists and others make and store on their own servers temporary and regularly
updated copies of materials contained on other servers with the purpose of
making the information more readily available to their own clients by avoiding
congestion at the “live” site. These kind of operations may also
amount to the infringing act of storage by electronic means [10].
Consequently there seems to be no doubt, that under the present United Kingdom
(UK) law browsing and caching are infringements of copyright unless either
there is some form of licence for that act or it can be brought under one
of the statutory permitted acts. Since downloading material from a website
leads to the production of a fixed and not transient copy, i.e. whether in
digital form in one’s computer or floppy disk, or as a hard copy by way
of a printout, it is more readily recognised in most legal systems as an infringing
reproduction.
Issuing copies of the work to the public.
Section 18 of the CDPA 1988 defines issuing to the public as putting copies
into circulation for the first time. This right is however, exhausted by initial
sale. The “on demand” nature of the Internet does not look much
like the issue of copies to the public, although it might be seen as a form
of circulation. The reason for this position is based on the fact that Section
I8 of the CDPA 1988 which deals with making copies to the public unlike Section
17 which deals with copying does not make any mention or reference to the
notion of “transient copy”. Therefore the copies required for the
purposes of Section 18 may therefore be limited to those which are non-transient,
which would go beyond mere on – demand transmission. It therefore follows
that a user who accesses material and passes it on to another user is not
guilty of infringement under Section 18 so long as the transmission is electronic.
Rental or Lending of a work to the Public
Section 18 A (2)(a) of the CDPA 1988 defines rental as making a copy of a
work available for use, on terms that it will or may be returned for direct
or indirect economic or commercial advantage. i.e. videos or games rental
stores. Section 18 A (2)(b) of the CDPA 1988 provides a similar definition
for the notion of lending except that unlike with rental the restricted act
is performed otherwise than for direct or indirect economic or commercial
advantage, and is carried out through an establishment which is accessible
to the public. A good example is a library that operates a Public Lending
Rights scheme. Also it is important to note that according to Section 18 A
(3) of the CDPA 1988, rental and lending do not cover making copies available
for the purpose of performance, showing, playing or exhibiting in public or
for the purpose of on – the – sport reference use.
The question of main concern to the project as regards rental and lending
rights is to find out whether they are applicable to Internet activities.
Like with copying, there are again difficulties because of the use of the
concept of a “copy”, which is what must be made available, and this
is further underlined by the expectation that the copy will be returned. This
makes it difficult to fit in with the ordinary usages of the Internet. The
requirement that for rental some sort of economic or commercial advantage
is necessary while for lending there must be an establishment accessible to
the public is not easily applicable in the context of normal Internet services.
Also the browser or user on the Internet may be said to be making an on-the-sport
reference use of the service, which would mean that the provider was not engaging
in rental or lending activities. A further discussion of rental and lending
restrictions as they apply to the Internet can be found in the, the European
Community (EC) Directive on Rental and Lending Rights and on Piracy [11]
Public performance, showing or playing
Section 19 (2)(b) of the CDPA 1988 defines performance to cover any mode of
virtual or acoustic presentation, including by means of a cable programme.
There is nothing in this definition that prevents an unauthorised display
on a computer screen of the texts of a literary work being a “performance”
of that work, and thus constituting infringement provided that it takes place
in public. In the case of sound recordings, films, broadcasts and cable programmes,
the equivalent form of infringement is playing or showing the work in public
[12]. What would prevent this form of infringement from being of much relevance
to the Internet, at least in it’s present pattern of usage, is merely
the fact that most displays of material do not take place in public. Therefore
if a display of such material can be proven to constitute a public display
then it would constitute copyright infringement if done without the consent
of the copyright owner. It should also be noted that the definition of “public”
for this particular copyright purpose is very wide [13]. Therefore the decision
of the Spanish Supreme Court in the case of Telstra Corporation Ltd. against
Australasian Performance Right Association Ltd. [14] that the non-simultaneous
transmission of copyright material to different persons in individual hotel
bedrooms require copyright licences is likely going to be the position to
be adopted by many other jurisdictions . Gathering together is therefore most
likely not going to be required in order to proof a public performance.
Broadcasting or inclusion in a cable programme service
Neither accessing a website nor incorporation of other people’s copyright
material thereon can constitute broadcasting, since broadcasting is a wireless
technology. However, a question which is of direct relevance is whether enabling
a user of one website to link to another site means that the second website
is included within the first site or whether the two are simply connected
but otherwise independent sites. If they are not independent sites then infringement
can be established. For example in has been suggested that the concept of
inclusion is apt to catch the situation where one website is linked to another
but the first site continues in view on screen by way of a “frame”
around the image from the second site [15].
Authorisation to infringe – Internet Service Provider’s liability
Section 16(2) of the CDPA 1988 as amended provides that authorisation of another
to infringe any form of copyright is itself infringement. Authorisation is
understood to mean sanctioning, approving or countenancing where there is
authority or control over those who actually infringe. This form of liability
is of obvious relevance to undertakings of businesses such as Internet service
providers, universities and other bodies including companies, which set up
the facilities on which infringing Internet activity take place. The questions
whether such bodies are liable will depend mainly on whether they give express
warning to users or customers against use of the equipment for infringing
copyright. Therefore in the cases of CBS Inc. v Ames Records & Tapes Ltd.
and SBS Songs Ltd v Amstrad Consumer Electronics Plc. it was held that commercial
libraries renting out sound recordings and manufacturers of double-headed
audio tape decks were not liable despite the fact that their services and
products rendered infringement easy and probable [16]. In contrast, in Moorehouse
v University of New South Wales, the university which provided photocopying
facilities for staff and students in it’s library was found to have authorized
infringement of copyright because it had taken no steps to deter such activity.
[17]
The appropriate measure of liability for those who provide Internet facilities such as the Napster indices, or machinery such as Rio MPMan player, which enable members of the public to use and enjoy material obtained from the Internet, therefore appears to be whether or not they took measures to keep users aware of the existence of copyright and warned against its abuse either by putting material on the service or downloading it.
Coexistence between electronic commerce
and patents
The patent system has played a vital role in promoting the development of
the underling technical infrastructure for electronic commerce. Electronic
commerce relies principally on the various computer and network technologies,
both hardware and software. The market exclusivity provided by the patent
protection system has provided a reward for investment and has justified the
expenditure in research and development to achieve further technological progress.
However, the new technologies notably the Internet now pose challenges to
the conventional legal scheme for patent protection. This will be illustrated
by examining some of the many issues associated with digital media and electronic
commerce in the context of patent protection.
As noted in chapter 1, patents are granted only to inventions that are novel,
involve an inventive step and are useful or industrially applicable. The general
rule is that to determine if the requirements of novelty and inventive step
are met, the claimed invention is compared with the existing state of the
art. The existing state of the art is also referred to as prior art. Prior
art or existing art, in electronic form, which exists in cyberspace i.e.,
published only on the Internet, raises serious questions as to its availability
as “prior art” and thus whether it can be applied against an invention
for which a patent is sought in determining novelty or inventive step. The
questions include, whether that kind of information has become prior art even
if it was disclosed on the Internet for only a limited time. Although similar
questions have been addressed with respect to prior art published on papers,
publication on the Internet may have different implications. Authenticity,
veracity and integrity are the critical issues for prior art in cyberspace,
because cyber art is considered to be more vulnerable to alterations and modification.
The determination of the timing of the disclosure and accessibility of the
cyber art to the public, given the networks ‘s capacity for instantaneous
dissemination on the international scale, is another major concern. Furthermore,
national laws may extend the concept of the prior art to include prior uses.
Under such national laws the concept of use of prior art in electronic form
will pose problems. Also the above-mentioned questions can also be extended
to cover the context of a grace period for public disclosure of an invention
before filing a patent application.
Many countries as well as Organisations will have to make modifications to
their patent laws in order to cover the problems pose by electronic commerce.
For example Japan recently amended its patent law to expressly provide that
an invention which was made publicly available online, for example via the
Internet, prior to the filing of an application for a patent would constitute
a novelty defeating bar. The amendment was also extended to cover, the problem
posed by the six months grace period by expressly providing that an invention
that was publicly disclosed online would fall within the six-month grace period
providing an exception to novelty-destroying disclosures. These amendments
to Japan’s patent law became enforceable in January 1, 2000 [18]. Japan’s
example is likely going to be followed by many other jurisdictions.
The Internet also raises complex jurisdictional issues as regards patent protection.
Conventionally patent protection is provided on a country-by-country basis
and the therefore the patent laws of each country or region are enforceable
only within the borders covered by the laws in question. However, electronic
commerce now provides a means by which patented software for example can be
sold and delivered over the Internet internationally. Any infringement action
for such a patent would therefore be confronted with serious jurisdictional
and choice of law issues. Worst still the first practical issue may be that
of even detecting or identifying the infringement of such a patent, given
that the unauthorized importation of such a software by means of the Internet,
unlike the importation of tangible goods, cannot be detected and stopped by
the custom or trading standards authorities.
Other questions particular to patent protection on the Internet may arise
in the case where a patented product invention consists of elements that are
physically located in different territories. For example in the case of process
patents, for a method or process, distinct elements in the claimed process
could be performed in different territories. If an alleged infringer operates
a system containing all the claimed elements within the territory in which
the invention is protected i.e. in the United Kingdom, there would be a straightforward
claim / case for infringement. However, the questions of infringement and
jurisdiction would be more difficult where a patented invention involves activities
in several countries by several individuals. Given this situation, it may
not be clear in which jurisdiction the accused infringers are actually using
the patented invention. [19]
Possible solutions to the problems and difficulties
The position of the World Intellectual Property Organisation
Trademarks
WIPO has taken measures to study the problems relating to the
use of trademarks on the Internet. It set up a Standing Committee on the Law
of Trademarks, Industrial Designs and Geographic Indications to study the
desirability and feasibility of harmonizing national rules concerning the
circumstances in which use of a trademark on the Internet constitutes use
of a trademark or trademark infringement. The said Standing Committee met
in June 1999 to discuss the results of its study. As an out come of the discussions
during the meeting of the Standing Committee, the International Bureau prepared
a questionnaire with hypothetical situations concerning legal issues relating
to the use of trademarks on the Internet. The questionnaire was to be answered
by each delegation on the basis of its national law on trademarks and the
Internet. The responses received showed a wide divergence of views on the
issues raised. The International Bureau has also prepared and issued a paper
on the same subject matter aimed at identifying areas where international
cooperation in the framework of WIPO appears to be both necessary and realistically
achievable.
Well-known trademarks have been given the special attention that they deserve
by WIPO. Well-known trademarks enjoy special protection under Article 6bis
of the Paris Convention [20] as well as other regional and international agreements.
While there is an international obligation under the above-cited Article 6bis
of the Paris Convention to accord protection to Well-known trademarks, there
exist no establish treaty definition of what constitutes a Well-known mark.
It is left to the appreciation of the competent authority in the country where
protection is asserted. Consequently Well-known marks have been the special
target of a variety of abusive practices on the Internet. WIPO has been working
to develop provisions on the protection of Well-known marks. The proposed
solutions were on the issue were adopted as a Joint Recommendation by the
WIPO General Assembly and Paris Union Assembly in September 1999. The provisions
clarify, consolidate and supplement the existing international protection
of Well-known mark as established by Article 6bis of the Paris Convention
and Articles 16.2 and 16.3 of the TRIPS Agreement. Article 2 of the Joint
Recommendation contain a list of factors that may be used by a competent authority
to determine whether a mark is well-known in its territory. Although the Joint
Recommendation does not have the force and effect of a treaty, member States
may consider the use it’s provisions as guidelines for the protection
of Well-known marks.
Article 6 of the Joint Recommendation expressly addresses the hotly debated
issue of conflict between trademarks and domain names. According to this provision
a domain name shall be deemed to be in conflict with a Well-known mark at
least where that domain name, or an essential part thereof, constitutes a
reproduction, an imitation, a translation or a transliteration of the Well-known
mark, and the domain name has been used or registered in bad faith. It goes
on to precise that it shall be understood that bad faith shall include the
cases that are currently known as “cybersquatting”, that is, the
registration of a Well-known mark as a domain name, with the intention of
selling it to the trademark owner. [20]
Domain names
In July 1998, WIPO commenced an extensive international process of consultation
commonly referred to as “the WIPO Internet Domain Name Process”.
The purpose of the process was to make recommendations to the corporation
established for the technical management of the domain name system, the Internet
Corporation for Assigned Names and Number (ICANN) on the issues arising out
of the coexistence or interface between domain names and intellectual property
rights. A report containing the recommendations has been published by WIPO.
It is also available online at WIPO’s website [21] Copies have been sent
to all member States of WIPO as well as all the non-governmental organizations
that are accredited with WIPO as observers. Some of the main recommendations
were as follows:
1. The adoption of a number of improves, minimum “best practices”
by registration authorities i.e. registrars of domain names, when registering
domain names in the generic top level domains (gTLDs). Other recommended practices
included, the establishment of a formalized agreement clearly setting forth
the rights and obligations of the parties, the collection and availability
of accurate and reliable contact details of domain name holders as an essential
tool for facilitating the protection of intellectual property rights on the
borderless or otherwise anonymous medium of the Internet. These contact details
were thought to provide the principal means by which intellectual property
owners can contact infringers in order to be able to take the necessary measures
aimed at enforcing their intellectual property rights.
2. The report recommended what it referred to as the “take-down”
procedure to be used by registrars. Under this procedure, if the contact details
of a domain name holder prove to be inaccurate or unreliable, making it impossible
to be used to establish contact with the domain name owner a third party should
have the right to serve a notification to this effect on the responsible registrar.
Upon independent verification of the impossibility of establishing contact,
the registrar should be required to cancel the domain name registration.
3. The report recommended that ICANN should adopt a uniform dispute resolution
policy under which an administrative dispute-resolution procedure is made
available for domain name disputes in all gTLDs. The scope of the administrative
procedure will cover cases of bad faith, abusive registration of domain names
that violate trademark rights. All other disputes arising within parties will
have to be covered by court litigation or other private disputes settlement
mechanisms such as arbitration. Also the administrative procedure should be
quick, efficient and cost effective. Determination under it would be limited
to orders for the cancellation or transfer of domain name registration. Decisions
arrived at, would be enforced directly, by registration authorities under
the dispute-resolution policy, without the need for a court order.
4. It was recommended as a solution to the famous and well-known marks problem
that, prior to the introduction of any new gTLDs , a procedure should be established
whereby the owner of a famous well-known mark can obtain an exclusion in some
or all the gTLDs for the name of the mark - where the mark is famous or well-known
on a widespread geographic basis and across different classes of goods or
services. The effect of the exclusion would be to prohibit any person other
than the owner of the famous or well-known mark from registering the mark
as a domain name. This therefore gives expression in cyberspace to the special
protection that is established for famous and well-known marks in the Paris
Convention and the TRIPS Agreement. However, the exclusion covers only the
exact name of the famous or well-known mark and since experience shows that
cybersquatters usually register many close variations of famous or well-known
marks it is was also recommended that an exclusion once granted should give
rise to an evidentiary presumption in the administrative procedure addressing
abusive registrations. The effect of the evidentiary presumption would be
to place the burden of proving justification for use of a domain name on the
domain name holder, where the domain name is identical or misleadingly similar
to the famous or well-known mark and the domain name is being used in a way
that is likely to damage the interests of the owner of the mark.
On October 24, 1999, the ICANN Interim Board approved a Uniform Domain Name
Dispute Resolution Policy (UNRP), with accompanying procedural Rules based
on the above-cited recommendations made by WIPO [22]. An implementation schedule
set up indicated that as of December 1, 1999; complaints could be submitted
to dispute resolution providers for disputes involving domain names registered
by accredited registrars. WIPO was very instrumental and provided ICANN, their
staff and the ICANN drafting committee with both advice and assistance in
the preparation of the implementation documents for the introduction of the
uniform dispute – resolution policy. However, the final Rules reflect
many but not all the comments and suggestions that WIPO provided. Since December
1999, the WIPO Arbitration and Mediation Centre has been providing dispute-resolution
services under the UDRP. As an additional initiative, WIPO is now also providing
advice to registrars of certain country code top-level domains (ccTLDs) in
relation to the possible adoption by them of the uniform dispute-resolution
policy recommended in the WIPO Report.
Copyrights and related rights
Some of the copyright and related rights problems and difficulties have solved
by WIPO as well as other International Organizations. So far significant progress
has been made with international consensus having already emerged on some
issues. In 1996 two treaties were concluded at WIPO aimed at redressing some
of these issues. They are the WIPO Copyright Treaty (WCT) [23] and the WIPO
Performance and Phonograms Treaty (WPPT) [24]. These treaties are jointly
commonly referred to as the “Internet treaties”. The treaties, address
the issues of definition and scope of rights in the digital environment, and
some of the challenges of online enforcement and licensing.
The most basic right granted by copyright and related rights is the right
of reproduction, which under the Berne Convention [4] covers reproduction
“in any manner or form”. This right is at the core of electronic
commerce because any transmission of a work or an object of related rights
presupposes the uploading of that work or object into the memory of a computer
or other digital device. In addition, when the work or object is transmitted
over networks, multiple copies are made in the memory of network computers
at numerous points. It is therefore necessary to determine how the reproduction
right applies to such copies. The WCT and the WPPT both provide that such
uploading into the memory of computers are acts of reproduction. They state
that the production right and the exceptions permitted, fully apply to the
digital environment in particular to the use of works in digital form. It
is understood that the storage of a protected work in digital form in an electronic
medium constitutes a reproduction within the meaning of both treaties. However,
the appropriate application of the reproduction right in the case of temporary
copies in computer random access memory (RAM) continues to be the subject
of debate at the national and international levels.
The WCT and WPPT also clarify the extent of right holder’s control when
works, performances and phonograms are made available to the public for downloading
or access on the Internet. This type of transmission is different from broadcasting,
in that the material is not selected and delivered by an active transmitter
like a broadcaster to a group of passive recipients. Rather it is transmitted
interactively, that is, on demand from individual users, at a time and place
of their choice. The treaties require that an exclusive right be granted to
control such acts of “making available”, while leaving it to individual
countries to decide how to categorize this right under the national law. As
to the scope of these exclusive rights the treaties continue to provide flexibility
to individual countries to develop exceptions and limitations that are appropriate
to their particular circumstances. The general “”three-step”
applied to the reproduction right in the Berne Convention and to all rights
in the Trade-Related Aspects of Intellectual Property Rights (TRIPS) [25]
is extended to apply to all rights in the Berne Convention and in the two
treaties. An important agreed statement clarifies that this test permits countries
to extend existing exceptions and limitations into the digital environment
or to add new ones, as appropriate.
The WCT and the WPPT also break new ground in recognizing the emerging role
to be played by technological protection measures, and the online, management
and licensing systems. They require member States to provide two types of
technological adjuncts to the protection of copyright and related rights,
in order to ensure that the Internet can become a safe place to disseminate
and license protected material. The first technological adjunct is generally
referred to as the “anti-circumvention” provision. It relates to
the need of right holders to rely on technological measures to protect works
against infringement on the Internet. No matter how ingenious the technology
used to protect works against unauthorized use, equally ingenious ways may
be developed to circumvent it. The resulting level of insecurity could prevent
right holders from being willing to disseminate valuable materials on the
Internet. Given the inability to achieve total security, a realistic goal
is to make the technology sophisticated enough to deter the ordinary consumer
from seeking to circumvent, while granting legal redress against those who
represent a greater threat i.e. hackers and those engaged in circumvention
as a business.
Patents
The World Intellectual Property Organisation has taken some remarkable measure
aimed at studying the desirability and feasibility of harmonizing rules concerning
the patent law implications of disclosure of technical information on the
Internet such as it’s impact on patentability and the related jurisdictional
issues.
The results of studies undertaken on these problems by the Standing Committee
on the Law of Patents set up by WIPO to study the problems and come up with
solutions are contain in The Draft Patent Law Treaty [26] which has been approved
by the WIPO General Assembly and the Paris Union Assembly. However, for this
draft Treaty to be enforceable it first of all has to be adopted by the Diplomatic
Conference of heads of states of member countries of WIPO and then given force
of law in the various countries – accession. This unfortunately is not
yet the case.
The position of the European Union.
The European Union has put in place a legal order as a means for affirming
the objectives of the Community. Legislation and implementation of European
Union law is therefore gaining strong grounds within the Union European with
uniform laws already in force among member countries of the union in various
areas. Intellectual property and electronic commerce constitute some of the
many areas in which legal harmonization has been undertaken.
Trademarks
The European Union has taken a series of regulatory instruments aimed at harmonizing
trademark law within the union. These include the following:
Council Directive 89/104 of 21 December 1988 lays down common rules on signs
constituting trademarks, ground for refusal or nullity and rights conferred
by trademarks [27].
Council Regulation 40 / 94 of December 20 1993 created the Community trademark
alongside national trademarks and set up a Community trademark office, which
became operational in Alicante in Spain in 1996[28].
Domain names
Domain names have also be considered by the European Union. The main measure
taken in this area is certainly Regulation No 733/2002 of the European Parliament
and the Council of April 22, 2002 on the implementation of the European Union
Top Level Domain (.euTLD). This regulation provides precise rules on important
aspects of this domain such as obligations of the registry and dispute resolution
[29].
Copyrights and related rights
In the area of copyright and related rights, the European Union has taken
a common stand on most issues. These include the following:
Council Directive 92/100 of 19 November 1992, on the borrowing and lending
of works of art [30].
Council Directive 93/83 of 27 September 1993 on cable distribution and satellite
broadcasting [31].
Council Directive 93/98 of 29 October 1993 harmonizing the duration of copyright
and related rights [32].
Directive on copyright and related rights in the information society adopted
on September 28 2000 [33].
The Council’s approval on March 16, 2000 of the World Intellectual Property
Organisation Treaty on copyright and the Performance and Phonograms Treaty.
The latter treaties ensure a balanced level of protection of copyright works
and allow public access to the content available on the Internet [25].
Patents
In the area of Patents the Luxembourg Agreement of 15 December 1989 created
a European patent, which is effective uniformly throughout the European Union
and issued by the European Patent Office (EPO) [34].
The Commission Regulation 240/96 of 31 January 1996 harmonised and simplified
the rules applicable to patent licences and know-how licences, to encourage
the dissemination of technical know-how in the Community and promote the manufacture
of technically improved products [35].
Regulation 1610/96 of 23 July 1996 created a supplementary protection certificate
for plant protection products. Directive 98/44 of 6 July 1998 protects biotechnological
inventions [36]. Harmonization has also been undertaken in the areas of computer
programs, [37] Databases, [38] topographies of semiconductors [39].
The position of the World Intellectual Property Organisation
Trademarks
WIPO has taken measures to study the problems relating to the use of trademarks
on the Internet. It set up a Standing Committee on the Law of Trademarks,
Industrial Designs and Geographic Indications to study the desirability and
feasibility of harmonizing national rules concerning the circumstances in
which use of a trademark on the Internet constitutes use of a trademark or
trademark infringement. The said Standing Committee met in June 1999 to discuss
the results of its study. As an out come of the discussions during the meeting
of the Standing Committee, the International Bureau prepared a questionnaire
with hypothetical situations concerning legal issues relating to the use of
trademarks on the Internet. The questionnaire was to be answered by each delegation
on the basis of its national law on trademarks and the Internet. The responses
received showed a wide divergence of views on the issues raised. The International
Bureau has also prepared and issued a paper on the same subject matter aimed
at identifying areas where international cooperation in the framework of WIPO
appears to be both necessary and realistically achievable.
Well-known trademarks have been given the special attention that they deserve
by WIPO. Well-known trademarks enjoy special protection under Article 6bis
of the Paris Convention [20] as well as other regional and international agreements.
While there is an international obligation under the above-cited Article 6bis
of the Paris Convention to accord protection to Well-known trademarks, there
exist no establish treaty definition of what constitutes a Well-known mark.
It is left to the appreciation of the competent authority in the country where
protection is asserted. Consequently Well-known marks have been the special
target of a variety of abusive practices on the Internet. WIPO has been working
to develop provisions on the protection of Well-known marks. The proposed
solutions were on the issue were adopted as a Joint Recommendation by the
WIPO General Assembly and Paris Union Assembly in September 1999. The provisions
clarify, consolidate and supplement the existing international protection
of Well-known mark as established by Article 6bis of the Paris Convention
and Articles 16.2 and 16.3 of the TRIPS Agreement. Article 2 of the Joint
Recommendation contain a list of factors that may be used by a competent authority
to determine whether a mark is well-known in its territory. Although the Joint
Recommendation does not have the force and effect of a treaty, member States
may consider the use it’s provisions as guidelines for the protection
of Well-known marks.
Article 6 of the Joint Recommendation expressly addresses the hotly debated
issue of conflict between trademarks and domain names. According to this provision
a domain name shall be deemed to be in conflict with a Well-known mark at
least where that domain name, or an essential part thereof, constitutes a
reproduction, an imitation, a translation or a transliteration of the Well-known
mark, and the domain name has been used or registered in bad faith. It goes
on to precise that it shall be understood that bad faith shall include the
cases that are currently known as “cybersquatting”, that is, the
registration of a Well-known mark as a domain name, with the intention of
selling it to the trademark owner. [20]
Domain names
In July 1998, WIPO commenced an extensive international process of consultation
commonly referred to as “the WIPO Internet Domain Name Process”.
The purpose of the process was to make recommendations to the corporation
established for the technical management of the domain name system, the Internet
Corporation for Assigned Names and Number (ICANN) on the issues arising out
of the coexistence or interface between domain names and intellectual property
rights. A report containing the recommendations has been published by WIPO.
It is also available online at WIPO’s website [21] Copies have been sent
to all member States of WIPO as well as all the non-governmental organizations
that are accredited with WIPO as observers. Some of the main recommendations
were as follows:
1. The adoption of a number of improves, minimum “best practices”
by registration authorities i.e. registrars of domain names, when registering
domain names in the generic top level domains (gTLDs). Other recommended practices
included, the establishment of a formalized agreement clearly setting forth
the rights and obligations of the parties, the collection and availability
of accurate and reliable contact details of domain name holders as an essential
tool for facilitating the protection of intellectual property rights on the
borderless or otherwise anonymous medium of the Internet. These contact details
were thought to provide the principal means by which intellectual property
owners can contact infringers in order to be able to take the necessary measures
aimed at enforcing their intellectual property rights.
2. The report recommended what it referred to as the “take-down”
procedure to be used by registrars. Under this procedure, if the contact details
of a domain name holder prove to be inaccurate or unreliable, making it impossible
to be used to establish contact with the domain name owner a third party should
have the right to serve a notification to this effect on the responsible registrar.
Upon independent verification of the impossibility of establishing contact,
the registrar should be required to cancel the domain name registration.
3. The report recommended that ICANN should adopt a uniform dispute resolution
policy under which an administrative dispute-resolution procedure is made
available for domain name disputes in all gTLDs. The scope of the administrative
procedure will cover cases of bad faith, abusive registration of domain names
that violate trademark rights. All other disputes arising within parties will
have to be covered by court litigation or other private disputes settlement
mechanisms such as arbitration. Also the administrative procedure should be
quick, efficient and cost effective. Determination under it would be limited
to orders for the cancellation or transfer of domain name registration. Decisions
arrived at, would be enforced directly, by registration authorities under
the dispute-resolution policy, without the need for a court order.
4. It was recommended as a solution to the famous and well-known marks problem
that, prior to the introduction of any new gTLDs , a procedure should be established
whereby the owner of a famous well-known mark can obtain an exclusion in some
or all the gTLDs for the name of the mark - where the mark is famous or well-known
on a widespread geographic basis and across different classes of goods or
services. The effect of the exclusion would be to prohibit any person other
than the owner of the famous or well-known mark from registering the mark
as a domain name. This therefore gives expression in cyberspace to the special
protection that is established for famous and well-known marks in the Paris
Convention and the TRIPS Agreement. However, the exclusion covers only the
exact name of the famous or well-known mark and since experience shows that
cybersquatters usually register many close variations of famous or well-known
marks it is was also recommended that an exclusion once granted should give
rise to an evidentiary presumption in the administrative procedure addressing
abusive registrations. The effect of the evidentiary presumption would be
to place the burden of proving justification for use of a domain name on the
domain name holder, where the domain name is identical or misleadingly similar
to the famous or well-known mark and the domain name is being used in a way
that is likely to damage the interests of the owner of the mark.
On October 24, 1999, the ICANN Interim Board approved a Uniform Domain Name
Dispute Resolution Policy (UNRP), with accompanying procedural Rules based
on the above-cited recommendations made by WIPO [22]. An implementation schedule
set up indicated that as of December 1, 1999; complaints could be submitted
to dispute resolution providers for disputes involving domain names registered
by accredited registrars. WIPO was very instrumental and provided ICANN, their
staff and the ICANN drafting committee with both advice and assistance in
the preparation of the implementation documents for the introduction of the
uniform dispute – resolution policy. However, the final Rules reflect
many but not all the comments and suggestions that WIPO provided. Since December
1999, the WIPO Arbitration and Mediation Centre has been providing dispute-resolution
services under the UDRP. As an additional initiative, WIPO is now also providing
advice to registrars of certain country code top-level domains (ccTLDs) in
relation to the possible adoption by them of the uniform dispute-resolution
policy recommended in the WIPO Report.
Copyrights and related rights
Some of the copyright and related rights problems and difficulties have solved
by WIPO as well as other International Organizations. So far significant progress
has been made with international consensus having already emerged on some
issues. In 1996 two treaties were concluded at WIPO aimed at redressing some
of these issues. They are the WIPO Copyright Treaty (WCT) [23] and the WIPO
Performance and Phonograms Treaty (WPPT) [24]. These treaties are jointly
commonly referred to as the “Internet treaties”. The treaties, address
the issues of definition and scope of rights in the digital environment, and
some of the challenges of online enforcement and licensing.
The most basic right granted by copyright and related rights is the right
of reproduction, which under the Berne Convention [4] covers reproduction
“in any manner or form”. This right is at the core of electronic
commerce because any transmission of a work or an object of related rights
presupposes the uploading of that work or object into the memory of a computer
or other digital device. In addition, when the work or object is transmitted
over networks, multiple copies are made in the memory of network computers
at numerous points. It is therefore necessary to determine how the reproduction
right applies to such copies. The WCT and the WPPT both provide that such
uploading into the memory of computers are acts of reproduction. They state
that the production right and the exceptions permitted, fully apply to the
digital environment in particular to the use of works in digital form. It
is understood that the storage of a protected work in digital form in an electronic
medium constitutes a reproduction within the meaning of both treaties. However,
the appropriate application of the reproduction right in the case of temporary
copies in computer random access memory (RAM) continues to be the subject
of debate at the national and international levels.
The WCT and WPPT also clarify the extent of right holder’s control when
works, performances and phonograms are made available to the public for downloading
or access on the Internet. This type of transmission is different from broadcasting,
in that the material is not selected and delivered by an active transmitter
like a broadcaster to a group of passive recipients. Rather it is transmitted
interactively, that is, on demand from individual users, at a time and place
of their choice. The treaties require that an exclusive right be granted to
control such acts of “making available”, while leaving it to individual
countries to decide how to categorize this right under the national law. As
to the scope of these exclusive rights the treaties continue to provide flexibility
to individual countries to develop exceptions and limitations that are appropriate
to their particular circumstances. The general “”three-step”
applied to the reproduction right in the Berne Convention and to all rights
in the Trade-Related Aspects of Intellectual Property Rights (TRIPS) [25]
is extended to apply to all rights in the Berne Convention and in the two
treaties. An important agreed statement clarifies that this test permits countries
to extend existing exceptions and limitations into the digital environment
or to add new ones, as appropriate.
The WCT and the WPPT also break new ground in recognizing the emerging role
to be played by technological protection measures, and the online, management
and licensing systems. They require member States to provide two types of
technological adjuncts to the protection of copyright and related rights,
in order to ensure that the Internet can become a safe place to disseminate
and license protected material. The first technological adjunct is generally
referred to as the “anti-circumvention” provision. It relates to
the need of right holders to rely on technological measures to protect works
against infringement on the Internet. No matter how ingenious the technology
used to protect works against unauthorized use, equally ingenious ways may
be developed to circumvent it. The resulting level of insecurity could prevent
right holders from being willing to disseminate valuable materials on the
Internet. Given the inability to achieve total security, a realistic goal
is to make the technology sophisticated enough to deter the ordinary consumer
from seeking to circumvent, while granting legal redress against those who
represent a greater threat i.e. hackers and those engaged in circumvention
as a business.
Patents
The World Intellectual Property Organisation has taken some remarkable measure
aimed at studying the desirability and feasibility of harmonizing rules concerning
the patent law implications of disclosure of technical information on the
Internet such as it’s impact on patentability and the related jurisdictional
issues.
The results of studies undertaken on these problems by the Standing Committee
on the Law of Patents set up by WIPO to study the problems and come up with
solutions are contain in The Draft Patent Law Treaty [26] which has been approved
by the WIPO General Assembly and the Paris Union Assembly. However, for this
draft Treaty to be enforceable it first of all has to be adopted by the Diplomatic
Conference of heads of states of member countries of WIPO and then given force
of law in the various countries – accession. This unfortunately is not
yet the case.
The position of the European Union.
The European Union has put in place a legal order as a means
for affirming the objectives of the Community. Legislation and implementation
of European Union law is therefore gaining strong grounds within the Union
European with uniform laws already in force among member countries of the
union in various areas. Intellectual property and electronic commerce constitute
some of the many areas in which legal harmonization has been undertaken.
Trademarks
The European Union has taken a series of regulatory instruments aimed at harmonizing
trademark law within the union. These include the following:
Council Directive 89/104 of 21 December 1988 lays down common rules on signs
constituting trademarks, ground for refusal or nullity and rights conferred
by trademarks [27].
Council Regulation 40 / 94 of December 20 1993 created the Community trademark
alongside national trademarks and set up a Community trademark office, which
became operational in Alicante in Spain in 1996[28].
Domain names
Domain names have also be considered by the European Union. The main measure
taken in this area is certainly Regulation No 733/2002 of the European Parliament
and the Council of April 22, 2002 on the implementation of the European Union
Top Level Domain (.euTLD). This regulation provides precise rules on important
aspects of this domain such as obligations of the registry and dispute resolution
[29].
Copyrights and related rights
In the area of copyright and related rights, the European Union has taken
a common stand on most issues. These include the following:
Council Directive 92/100 of 19 November 1992, on the borrowing and lending
of works of art [30].
Council Directive 93/83 of 27 September 1993 on cable distribution and satellite
broadcasting [31].
Council Directive 93/98 of 29 October 1993 harmonizing the duration of copyright
and related rights [32].
Directive on copyright and related rights in the information society adopted
on September 28 2000 [33].
The Council’s approval on March 16, 2000 of the World Intellectual Property
Organisation Treaty on copyright and the Performance and Phonograms Treaty.
The latter treaties ensure a balanced level of protection of copyright works
and allow public access to the content available on the Internet [25].
Patents
In the area of Patents the Luxembourg Agreement of 15 December 1989 created
a European patent, which is effective uniformly throughout the European Union
and issued by the European Patent Office (EPO) [34].
The Commission Regulation 240/96 of 31 January 1996 harmonised and simplified
the rules applicable to patent licences and know-how licences, to encourage
the dissemination of technical know-how in the Community and promote the manufacture
of technically improved products [35].
Regulation 1610/96 of 23 July 1996 created a supplementary protection certificate
for plant protection products. Directive 98/44 of 6 July 1998 protects biotechnological
inventions [36]. Harmonization has also been undertaken in the areas of computer
programs, [37] Databases, [38] topographies of semiconductors [39].
Proposed legal and technical guidelines for companies
involved in or willing to set up electronic commerce:
Trademarks
Since the territory of the Internet is everywhere and nowhere
in particular, a business involved in electronic commerce can potentially
be subjected to jurisdictions of foreign countries, with the associated expenses
required for it to defend itself overseas in a different language under different
laws.
Because of such eventualities, the recommended guide line to be followed by
a business that has a website is to avoid suits in remote jurisdictions through
any of the following means:
Limiting the purpose of the website to merely posting of information about
the business i.e. online marketing.
By limiting the interaction of the website in order to achieve a specific
desired objection i.e. specific group of clients, such as interacting only
with clients in the United Kingdom.
By refusing to do business within jurisdictions in which it does not wish
to get involve with litigation or other legal matters.
By inserting a choice of law clause in all contracts i.e. choosing the laws
of a particular jurisdiction, for example the United Kingdom, as the law applicable
for all contracts or transactions.
By making sure the website does not infringe any intellectual property right
i.e. trademark, copyright etc.
Make sure they create links only to the home pages of other websites and preferable
with the consent express or implied of the owners of the websites with which
a link is created.
Avoid infringement of trademarks or copyright through the unlawful
insertion of frames and logos of other websites on their website.
Avoid listing intellectual property protected words such a trademarks
in their Meta tags. Note the Meta tag is a software parameter within Hypertext
Markup Language, where the site creator lists or describes what is available
on that particular website.
Finally in view of the fact that everything on the Internet
is instantly global, opening online businesses to millions of potential customers
but also millions of potential hazards it is recommended that any company
involved in electronic commerce should constantly be mindful of all the possible
ramifications of every part of their website and respect the intellectual
property rights of others.
Domain names
Under the Uniform Domain Dispute Resolution Policy (UDRP), the prove of certain
aspects is very important in order to establish or refute a claim over a domain
name. It is therefore recommended that companies involved in electronic commerce
should always be mindful of the following facts:
Having a registered trademark or rights in a trademark is essential if a party
is to be able to claim that a domain registrant is violating that party’s
rights by having a particular domain. It is therefore recommended that businesses
involved or interested in getting involved in electronic commerce should take
necessary measures to obtain trademark rights either by registration or licensing
over any word or words to be used as their domain names. It should also be
noted that although all word trademarks can be domain names, not all domain
names qualify for protection as trademarks i.e. some domain names are not
distinctive.
The proof of bad faith on the part of a domain name registrant
is very important in any dispute over a domain name. Therefore it is recommended
that a business that is involved in electronic commerce should avoid the well-known
practice of cybersquatting. This practice can destroy both the profitability
and reputation of an otherwise successful business. It constitutes what can
be defined as online piracy. Clients will definitely not be willing to deal
with pirates, especially not in electronic commerce where trust and confidence
is paramount.
The ability to prove a legitimate interest in any claim over
a domain name is important. Therefore, the recommended practice for companies
involve in electronic commerce is to use words that are protected or associated
to their businesses as part of their domain names i.e. it could use the companies
trademark, the company’s name etc.
It is recommended that businesses involved in electronic commerce
should not use domains that are Non-proprietary Names (INNs). This is a class
of unique identifiers for pharmaceutical substances developed by the World
Health Organisation (WHO) in coordination with national authorities worldwide
i.e. amoxicillin, amfetamine and ibuprofen. This is because under existing
law, it is not allowed to acquire proprietary rights including even trademark
rights, in any Non-proprietary names. However, because the domain name registration
system makes it possible for any one to register a domain without restrictions
on a first-come first served basis, anyone may be able to register an INN
as a domain name. Such registrations do not only create confusion among consumers,
patients and health professionals but they also present public safety concerns
when inaccurate and misleading information is included in the website accessed
through a domain name using an INN. Any interested party has the right to
serve a notice that a gTLD domain name registration be cancelled on grounds
that it is identical to an INN. Such notices can also be filed for ccTLDs.
It is recommended that businesses involved in electronic commerce
should not use domains that are names or acronyms of International Organizations
(IGOs) i.e. the United Nations, International Monetary Fund, World Trade Organisation
etc. Similar protection is available against the registration of such names
or acronyms as trademarks in Article 6 of the Paris Convention for the Protection
of Industrial Property. This Article expressly prohibits the registration
and use of the abbreviations and names of International Intergovernmental
Organisations as trademarks or elements of trademarks.
Under the UDRP only personal names that qualify as trademarks
are protected from registration as domain names without the authorization
of their owners. However it is recommended that businesses involved in electronic
commerce should not use personal names especially of prominent persons as
their domain names. This could eventuality lead to serious litigation, especially
given that the law in this area is still not certain.
It is recommended that businesses involved in electronic commerce
should not use domains that are misleading geographical indicators i.e. false
description of the geographical sources of goods – such as “Made
in Japan” and the misuse of special class of geographical source indicators
used to protect products such as wines i.e. “champagne”. Although
such names do not enjoy any specific protection under the rules applied by
the UDRP, they are protected under international conventions such as the Paris
Convention, the Madrid Agreement and the TRIPs (Trade-Related Aspects of Intellectual
Property Rights).
Under the UDRP trade names are not trademarks per se and are
not given any special protection. However because trade names enjoy protection
at national level in most countries in the world under a combination of civil
and criminal law, commercial law, trade practices, trademark legislation,
and common law principles of unfair competition and passing off, it is recommended
that businesses involve in electronic commerce should avoid using trade names
as their domain names.
It is recommended that companies involve in electronic commerce
should avoid using domains that contain the ISO 3166 alpha – 2 code elements
– the standardized codes for countries used at the ccTLD level such as
“fr” for France, “uk” for United Kingdom. Such a use is
not allowed because of any potential confusion or abuse that may arise. For
example a domain name that has “tesco” at the third level and “uk”
at the second level (tesco.uk.com) is undoubtedly misleadingly similar to
tesco.uk or tesco.com and would likely be declared as such in case of any
eventual dispute.
Copyrights and related rights
1. Protectable subject matter.
The general rules on copyright apply in the same way to electronic commerce
as in usual life. Therefore, all works are protected insofar as they are original
and available in a material form - electronic or any other form i.e. the main
concern is that a work claiming copyright protection should fulfil the conditions
of originality and expression in a particular form.
2. Formalities to obtain copyright protection.
There are no formalities to be fulfilled in order to obtain copyright protection.
The right is generated automatically by the expression of original works in
a material form i.e. painting a picture. There is therefore no requirement
for registration as is the case with some other forms of intellectual property
rights such as trademarks and patents.
3. Content of a web site
Copyright covers all the content of a web site. Examples include the following:
literary works, musical works photographic works, artistic works, pictures,
databases, computer programs, motion pictures etc.
4. Rights conferred by copyright protection
Author or owners of copyright in a work hold the exclusive right to use and
can prohibit or authorize others to use it, i.e. reproduction in various forms
or public performance of the work as in the case of a play or musical work.
5. Works not protected by copyright
Some works are cannot be protected by copyright either because they do not
meet the originality and expression in a material form requirement or because
the copyright has expired. Copyright in work survives the author and only
expires 70 years after the author’s death. After the expiration of this
period, anybody is allowed to use the work without asking the owner of the
copyright for a prior authorization or consent.
What to do in order to obtain the right to use a copyright protected work.
Identify the copyright protected work required to be used i.e. texts, pictures,
drawings etc.
Identify the required use to i.e. reproductions, publication, public performance
etc.
Check if the work is protected by copyright and that the duration of copyright
protection in the work has not expired.
Check if the projected use requires the consent of the author i.e. if it is
for private use, research or in order to criticise the work or any order form
of use that is an exemption from copyright then it will not require the author
or the owner’s consent.
Identify all the copyright authors or owners
Contact them and negotiate a licence to use the work
It should be noted that contrary to what most people think the consent of
the owner of copyright should be obtain for every copyright protected material,
even for simply things such as:
Scanning a picture or text or any other form of work in order
to put it on a website. All pictures, photos and text are generally protected
if the condition for a copyright protection are fulfilled and the duration
of protection has not expired. Therefore if a web designers wants to reproduce
any of such works in his website, he is required to ask the copyright owner’s
authorization. Usually, these is unfortunately not the case given that people
just use photographs or pictures on their websites without bordering to find
out the authors not to talk of even obtaining their consent.
The common practice of down loading a work i.e. logos, text
etc. from another website and reproducing in one’s own website also requires
the consent of the copyright owner.
6. The law as concerns hyperlinks and framing
The creation of a link on one’s website to another website does not as
a general principle require the authorization of the copyright owner on the
linked website. Indeed, one considers that the creator of a website gives
his tacit consent to the linking. However, in certain cases this practice
may be considered illegal under other legal rules other than copyright. Linking
such as framing may be considered as illegal if it misleads the user on the
identity of the true owner of the website. Other practices such as deep linking
i.e. when a link refers to another page in a website other than the home page,
may be considered as an unfair practice. Indeed the calculation of the traffic
on a website from which depends the advertising income is often based on the
number of visits made on the home page.
7. The law as concerns MPEG Audio Layer-3 (MP3)
MP3 is the compression technology commonly use to make digital audio computer
files relatively small while maintaining high audio quality. It is the common
formats used for uploading and downloading on the Internet. From a legal point
of view, an MP3 file is a musical work on a specific format, which is covered
by copyright protection under the same conditions as any other works. MP3
is not per se illegal but it is the use of the technology that may constitute
a copyright infringement. Other possible uses of MP3 are also wealth considering.
They are as follows:
Transferring a CD to MP3 files on a computer hard drive. This
would be covered by the exception of making a copy for private use, which
is available in the legislation applicable in most European countries.
Making available MP3’s on the Internet. The publishing
of MP3’s on the Internet is considered to be a communication to the public.
It is the author’s prerogative and therefore requires his consent.
Downloading MP3’s from the Internet. The legality of the
mere fact of downloading MP3’s is so far still very controversial. On
the one hand, some people consider that such a download is covered by the
exception for making a copy for private use. In such a situation, the reproduction
may be done without the owner’s consent. On the other hand, the act of
downloading may be considered as exceeding the limits of the exception for
private copy. Indeed, a download can be realized by different people located
at different places at the same time. This type of reproduction should not
be considered to be done for private purposes. In view of the unclear legislations,
it is recommended to avoid such practices.
7. The legal significance of the copyright notice or symbol
The COPYRIGHT notice that appears at the end of most works can merely create
a presumption that the person indicated is the copyright owner on the work.
The existence or absence of such a notice on a work does not in any way guarantee
existence or absence of rights on a work. Thus in the event of litigation
a copyright notice will make it easier to prove or presume the copyright owner.
Therefore the notice is absolutely not mandatory in order to enjoy copyright
protection in a work.
8. The legal significance of works marketed or published with a “copyleft”
or “copyfree” notice
The author uses the “copyfree” notice in order to give a free licence
to the user under certain specific conditions mentioned on the work in question.
It is therefore recommended that before using such works, users should check
the directions for use on the website or given with the CD-ROM in order to
know which uses are allowed by the copyright owner.
9. The legal distinction between “shareware” and “freeware”
While “freeware” is entirely free software, “shareware”,
is software distributed for the purpose of evaluation by the final user. After
the trial period, the user is supposed to take a licence or stop the use of
the software.
10. The law as concerns databases
A 1996 EU Directive provides protection to databases in Europe. As a general
rule a database can be protected both by copyright and by a sui generis right
under the European Union Databases Directive. If the database is original,
it can be protected by both a sui generis right and copyright. A database
is protected by copyright insofar as the choice and arrangement of the information
constitute an original creation. However, if the database is not original,
it can only be protected by a sui generis right even if not protectable under
copyright. The right protects investors against the re-use of substantial
parts of the content of non-creative databases. This right requires a substantial
investment of the creator in terms of quantity and or quality for the creation
of the database. The owner of the sui generis right is the investor. The duration
of the database right is 15 years from the creation of the database. However
this duration is repeated on each substantial investment in the database.
11. The law as concerns computer programs
A 1991 European Community Directive protects computer programs, by copyright,
as literary works. A computer program is protected if it is original in the
sense that it is the author’s own intellectual creation. The exclusive
rights of the author include the right to perform or to authorize: reproduction
of a computer program, translation, adaptation, arrangement and other alteration
of a computer program and distribution, including rental, of a computer program
or the copies thereof. It should be noted that the broad definition of reproduction
right includes almost every form use of a computer program. Therefore virtually
every use of a computer program will require the author’s authorization
in the form of a licence.
Patents
1. It is recommended that companies involved in electronic commerce should
take necessary measures to apply for and obtain patent protection for their
inventions before, going ahead to exploit the inventions. This will enable
then to control and stop infringement by others who try to imitate the invention
and by so doing take undue advantage. With the risk of infringement by reverse
engineering, research and development in the area of electronic commerce would
be worthless to a company if it fails to take necessary measures to get patent
protection for it’s inventions.
Patents can now be granted for inventions concerning financial services, electronic
sales, advertising methods, business methods including business methods consisting
of processes to be performed on the Internet and telephone exchange and billing
methods.
Because the contemporary practice is to market software products in the form
of computer readable media, for example, diskettes and CD-ROMS or directly
over the Internet, it has become a recommended practice to claim such software
related inventions as a computer readable medium storing the software that
performs the claimed function. This type of claim is commonly referred to
in legal parlance as “Beauregard – Type claim ”. Other types
of claims include the “Lowry – Type claim”. This is usually
formulated to read as follows: “a computer readable medium storing a
data structure, which data structure is interrelated to the medium structurally
and functionally. The third type of claim is the “Propagated signal claim”
and it usually formulated to read as follows: “a claim to a computer
data signal that is embodied in a carrier wave”.
2. It is recommended that an invention should not be published on the Internet
prior to the filing of a patent application because such publication is considered
in many jurisdictions as a disclosure and therefore a novelty-defeating bar.
Also an invention that was publicly disclosed online would fall within the
six months grace period, providing an exception to novelty –destroying
disclosures.
Conclusion
Fulfilment of the aims and objectives
The main aim of this project was to undertake an analysis of the impact of
electronic commerce on intellectual property and to formulate recommendations
and guidelines for companies involved or wanting to be involved in electronic
commerce. These recommendation and guidelines provide such businesses with
the right approach to take whenever they are confronted with the technical
and legal hazards encountered as a result of doing business online. The main
recommendations and guidelines are developed in chapter 4.
Further work that could have been covered
Many aspect of intellectual property on the Internet and electronic commerce
are of capital importance to electronic commerce in particular and to information
technology in general. It is therefore an interesting landmine for research.
Technological advances have serious legal and technical repercussions on electronic
commerce and therefore need to be constantly monitored. Electronic commerce
and the law are bound to grow along side technology even if technology is
taking the lead.
If given the time and resources, I would have furthered my research to cover
other legal aspects of electronic commerce and the Internet such as Internet
jurisdiction, electronic / paperless contract and online security.
The experience acquired
The project provided a golden opportunity for me to pursue in depth my interest
in some of the legal repercussions of electronic commerce and the Internet,
notably intellectual property. It helped me to develop and carry out research
on both the main and related issues concerning the subject of my research.
On the whole it was a learning process, which would certainly be beneficial
in all my future endeavours.
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