The TPP is doomed: Have Aussie ISVs dodged a bullet?

The TPP is doomed: Have Aussie ISVs dodged a bullet?

Local independent software vendors may get a reprieve if the TPP is quashed

Australian Prime Minister, Malcolm Turnbull

Australian Prime Minister, Malcolm Turnbull

With US President-elect, Donald Trump, set to take his place in the White House on 20 January, the controversial Trans-Pacific Partnership (TPP) is most likely dead in the water.

This could be good news for local IT channel partners that have made a name for themselves as independent software vendors (ISVs).

A number of provisions in the intellectual property (IP) chapter of the Pacific trade pact had raised concerns among many of Australia’s IP experts, with some suggesting that the agreement could open the door for legal challenges from companies in other member countries and stifle local software development opportunities.

The deal, in its present from, was finalised and signed in February after years of negotiations, but it is yet to be ratified by the member countries, which include the US, Australia, New Zealand, Japan, Mexico, and Singapore.

Now, with Trump’s win in the US general election, the deal is likely to swept off the table sooner rather than later.

Throughout his campaign, Trump was dismissive of the agreement, which would have seen numerous trade tariffs with partner nations dropped, arguing that the US would see greater economic benefits by retaining and, indeed, creating new trade tariffs with trading partners.

Although the remaining 11 TPP signatories could conceivably still ratify an agreement without the US, it is unlikely, given that one of the driving forces behind the agreement’s appeal was to grant greater access to the US economy.

While the impending demise of the TPP might be troubling to some industries in Australia, such as those the agriculture sector, which would likely have benefitted from the agreement, it may come as a relief to local IT channel partners that make their living developing software solutions for their customers.

Concerns about some of the IP provisions in the trade agreement in its current form were raised multiple times by industry experts during a series of senate inquiry hearings, held over the past several months, into the TPP.

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Among the concerns raised were questions about how certain provisions would affect the freedom of Australian partners to develop software solutions for end clients.

Not only would some elements of the agreement opened up greater recourse for large US software vendors to extend IP copyright claims in Australia, potentially affecting the local IP landscape, it may also have restricted ISVs engaged in open source-based software development from certain areas of the market.

Jack Burton, chairman of the local industry body for open source software companies in Australia, Open Source Industry Australia, raised concerns during a parliamentary hearing in October over certain provisions in the agreement’s IP chapter.

“Looking at Article 18.80, which relates to government use of software, the wording of that article effectively prohibits the Commonwealth government from using software that is already in the public domain,” Burton told members of the Joint Standing Committee on Treaties.

“We have members in our industry who make their money not from selling software but from selling services around software that is open source and in some cases that has entered the public domain by explicit declaration of the author.

“If, under the TPP the Commonwealth government is prohibited from using public domain software, our members obviously cannot provide services, be they training services, be they support services, be they implementation or be they consulting services around that software that is in the public domain. That would be one specific example.

“And I think that one is not a matter of intent. I think it is simply a matter of slightly careless drafting in that provision,” he said.

Burton’s comments follow concerns raised by the Australia Competition and Consumer Commission (ACCC) in late 2015, about how the TPP might affect the IP regime in Australia.

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The competition watchdog said in a parliamentary submission at the time that the agreement, “appears to impose IP restrictions beyond existing international treaties, and this may tilt the balance in favour of IP rights holders to the detriment of competition and consumers”.

Likewise, copyright reform advocacy group, the Australian Digital Alliance, warned the government that the agreement could potentially stifle future copyright reform in the country, a move that could have ramifications for local ISVs.

“It imposes explicit requirements regarding enforcement and recognition of owners’ rights, through mechanisms such as term extensions and anticircumvention provisions,” it said in its submission.

“However, it imposes no obligations on copyright owners; provides little support for the flexible exceptions and limitations relied on by industries such as technology and education; and grants almost no protection to consumers,” it said.

Australian Prime Minister, Malcolm Turnbull, called Trump on 10 November and, according to media reports, the two talked about the controversial Pacific trade agreement.

While the two reportedly agreed on the “vital importance of our strong alliance,” it is clear that if Trump does, indeed, get his way, the TPP will be dead by early next year, potentially giving local developers a reprieve on the international IP copyright front.

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