WORLD TRADE
ORGANIZATIONIP/C/W/128/Add.1
15 May 2003
(03-2609)
Council for Trade-Related Aspects
of Intellectual Property Rights
THE WORK PROGRAMME ON ELECTRONIC COMMERCE
Background Note by the Secretariat
Addendum
I. INTRODUCTION
1. At its meeting in March 2002, the Council for TRIPS requested the Secretariat to update its
factual background note examining the provisions of the TRIPS Agreement relevant to paragraph 4.1
of the Work Programme on Electronic Commerce.  This background note was prepared upon a
request by the Council at its meeting in December 1998 and circulated in February 1999 in documentIP/C/W/128.  At the Council's meeting in March 2002, the Chair noted that the update should reflect
recent developments that were relevant to the is sue, including the work carried out by WIPO and
other intergovernmental organizations.  This update has been prepared in response to this request.  It
focuses on a number of important developments in the international regulatory framework that
concern certain issues already discussed in document IP/C/W/128.  It should be read in conjunction
with the original document since it does not contai n the information provided in that original note.
2. Part II of this update briefly summarizes the relevant work carried out by the WTO since the
launch of the Work Programme.  Parts III and IV l ook at certain developments concerning standards
of protection, and enforcement and related matters.  Regarding work carried out by other
intergovernmental organizations, it might be noted that the General Assembly of WIPO adopted, at its
meeting in September 1999, a WIPO Digital Agenda, which set out a series of guidelines and goals
for WIPO in seeking to develop practical solutions to the challenges raised by the impact of electroniccommerce on intellectual property rights.
1  In December 2002, WIPO published a survey entitled
"Intellectual Property on the Internet:  A Survey of Issues" (hereinafter "the WIPO Survey"),2 which
includes a summary of the main developments in relation to the topics on the WIPO Digital Agenda.3
Work carried out by WIPO and other intergovernmenta l organizations is reflected in the context of the
discussion of various topics below.
                                                     
1 The WIPO Digital Agenda can be accessed through WIPO's gateway page on electronic commerce
and intellectual property at http://ecommerce.wipo.int/index.html.  This page contains a wealth of information
on WIPO's activities in this area.
2 A WIPO document WIPO/INT/02 available at http://ecommerce.wipo.int/survey/index.html.  It
reflects the developments that have occurred since the publication in May 2000 of a WIPO "Primer onElectronic Commerce and Intellectual Property Issues".
3 Paragraphs 507-531 of the WIPO Survey.This document has been prepared under the Secretariat's own
responsibility and without prejudice to the positions of Members
and to their rights and obligations under the WTO.IP/C/W/128/Add.1
Page 2
II. DEVELOPMENTS IN THE WTO
3. A "Declaration on Global Electronic Commerce"  was adopted on 20 May 1998 in Geneva by
the second session of the Ministerial Conference.4  Ministers recognized that global electronic
commerce was growing and creating new opportunities for trade, and urged  the General Council to
establish a comprehensive work programme to examine all trade-related issues relating to global
electronic commerce, taking into account the economic, financial, and development needs ofdeveloping countries.  They also declared that Members would continue their current practice of not
imposing customs duties on electronic transmissions.
4. At its meeting in September 1998, the General Council established a Work Programme on
Electronic Commerce
5 for the relevant WTO bodies, namely the Council for Trade in Services, the
Council for Trade in Goods, the Council for TRIPS and the Committee on Trade and Development.
Paragraph 4.1 of the Work Programme provided that "the Council for TRIPS shall examine and report
on the intellectual property issues arising in connection with electronic commerce.  The issues to beexamined shall include:
- protection and enforcement of copyright and related rights;
- protection and enforcement of trademarks;
- new technologies and  access to technology."
5. Paragraph 34 of the Ministerial Declaration, adopted at the fourth session of the Ministerial
Conference on 14 November 2001 in Doha,
6 on electronic commerce reads as follows:
"We take note of the work which has been done in the General Council and other
relevant bodies since the Ministerial Declaration of 20 May 1998 and agree to
continue the Work Programme on Electronic Commerce.  The work to date
demonstrates that electronic commerce creates new challenges and opportunities fortrade for Members at all stages of development, and we recognize the importance of
creating and maintaining an environment which is favourable to the future
development of electronic commerce.  We instruct the General Council to consider
the most appropriate institutional arrangements for handling the Work Programme,
and to report on further progress to the Fifth Session of the Ministerial Conference.We declare that Members will maintain their current practice of not imposing
customs duties on electronic transmissions until the Fifth Session."
6. Regarding institutional arrangements for handling the Work Programme, the General Council
agreed at its meeting in October 2002 to maintain, for the duration of the work until the Fifth
Ministerial Conference, the current institutional arrangements for handling the Work Programme on
Electronic Commerce, namely that the Councils for Trade in Services, Trade in Goods and TRIPS,
and the Committee on Trade and Development would examine and report on aspects of electroniccommerce relevant to their respective areas of competence, and that the General Council would play a
central role in the entire process, would keep  the Work Programme under continuous review and
would consider any trade-related issue of a cross-cutting nature.
7
                                                     
4 Document WT/MIN(98)/DEC/2.
5 Document WT/L/274.
6 Document WT/MIN(01)/DEC/1.
7 Paragraphs 49-51 of document WT/GC/M/76.IP/C/W/128/Add.1
Page 3
7. WTO Members have held four dedicated discussions on cross-cutting issues relevant to
electronic commerce under the auspices of the General Council.8  A list of cross-cutting issues
identified by delegations can be found in the att achments to the summaries of the first and second
discussions.  In this context, many delegations have highlighted the issue of classification of the
content of certain electronic transmissions as a key issue in handling electronic commerce within theWTO work.  The question is whether the supply of digi tised products that can be delivered either on a
physical medium or through an electronic transmi ssion should be classified and addressed under
GATS or GATT.
9  The products concerned consist principally of sound recordings, audiovisual
works, video games, computer software and literary works, i.e. contents protected by copyright,
related rights or other intellectual property rights ("IPRs") that can be delivered in a physical form
such as CDs, CD-ROMs, DVDs, videos, books, newspapers and magazines, or in an electronic form
over the Internet.  As far as IPRs are concerned, the classification of the products in question for thepurposes of GATS and GATT would not appear to affect the IP protection that the contents embodied
on those products enjoy under the provisions of the TRIPS Agreement.  The question under the
TRIPS Agreement is under what circumstances an authorization by the author or some other right
holder is required for the reproduction, electronic transmission or other use of such contents.
8. The issue of electronic commerce has been a standing item on the TRIPS Council's agenda
since its meeting in December 1998.  The records of the discussions are contained in the minutes of
the relevant meetings in documents IP/C/M /21-35, IP/C/M/36/Add.1, IP /C/M/37/Add.1, IP/C/M/38
and IP/C/M/39.  The Council invited the representative of WIPO at its meetings in December 1998,
July 1999 and September 2000 to provide information on WIPO's activities dealing with electronic
commerce.  The Council submitted its first Progress Report to the General Council in July 1999(IP/C/18), and a second Progress Report to the Gene ral Council was provided by the Chairman on his
own responsibility in December 2000.  Both reports reflected Members' view that the novelty and
complexity of the intellectual property issues arising in connection with electronic commerce were
such that continued further study was required by the international community to better understand
the issues involved.  It was noted that a great deal of work in this connection was under way in WIPO.In the light of its responsibilities in the area of in tellectual property, the Council was of the view that
the WTO should continue to consider developments in this area, including the further work of
WIPO.
10  An Annex to this document contains a list of documentation on electronic commerce
circulated in the TRIPS Council.11
9. One of the issues mentioned in paragraph 4.1 of the Work Programme concerns new
technologies and access to technology.  In this context, the original background note in document
IP/C/W/128 discussed questions relating to transfer of technology.12  As regards the transfer of
technology to least-developed countries, developed country Members made information on their
implementation on Article 66.2 of the TRIPS Agreement13 available for the TRIPS Council's meeting
in November 2002.  A number of these submissions reported on incentives for technology transfer
                                                     
8 Summaries of the discussions can be found in the following documents:  the first discussion in
June 2001 in WT/GC/W/436;  the second discussion in May 2002 in WT/GC/W/475;  the third discussion in
October 2002 in WT/GC/W/386;  and the fourth discussion in February 2003 in WT/GC/W/492.
9 For more information, see a background note by the Secretariat entitled "E-Commerce Work
Programme:  The Classification Issue" circulated in document JOB(02)/37, and paragraphs 146-154 of Annex IIto document WT/COMTD/M/40.
10 Paragraph 12 of IP/C/18 and paragraph 9 of IP/C/20.
11 The contents of the written submissions made to the Council have not been summarized in this
update.
12 Paragraphs 21-26 of IP/C/W/128.
13 Article 66.2 requires developed country Members to "provide incentives to enterprises and
institutions in their territories for the purpose of promoting and encouraging technology transfer to least-developed country Members in order to enable them  to create a sound and viable technological base".IP/C/W/128/Add.1
Page 4
related to electronic commerce.14  Having regard to instructions of the Doha Ministerial Conference,15
the TRIPS Council, at its meeting in February 2003, put in place a mechanism for ensuring the
monitoring and full implementation of the obligations in Article 66.2 of the TRIPS Agreement.16  The
role of IP protection in the transfer of techno logy has also been addressed by the Working Group on
Trade and Transfer of Technology, which was established by Ministers in Doha to examine the
relationship between trade and the transfer of technology.17  The original note also discussed the
potential of information and communications technologies to facilitate access from anywhere in the
world to the valuable and extensive technological information contained in patent documents and to
improve the efficiency of intellectual property offices in other ways.18  A number of developed
country Members have reported to the Council on their technical cooperation activities aimed at
modernizing IP offices and their services.19  WIPO is in the process of putting in place a global
information network, WIPO NET, to connect IP offices worldwide.20
10. The original background note also discussed questions concerning the potential application of
the TRIPS Agreement's provisions relating to anti-competitive practices in the context of electronic
commerce and the Internet.21  Although issues concerning the interface between intellectual property
rights and competition policy were discussed in the early work of the Working Group on the
Interaction between Trade and Competition Policy,22 they have not been a significant focus of the
Group's work since the original note was prepared.23
11. There have not yet been any cases under the WTO dispute settlement system that would have
focused on the use of intellectual property on the Internet.  However, the communication to the public
of works transmitted over the Internet was addressed in the panel report on United States – Section
                                                     
14 The submissions by Australia, Canada, the European Communities and their members States, and the
United States, circulated in documents IP/C/W/388/Add.2, IP/C/W/388, IP/C/W/388/Add.6 andIP/C/W/388/Add.7, respectively.
15 Paragraph 11.2 of the Doha Decision on Implementation-Related Issues and Concerns
(WT/MIN(01)/17).
16 Implementation of Article 66.2 of the TRIPS Agreement;  Decision of the Council for TRIPS of
19 February 2003 (IP/C/28).
17 The Working Group will report to the General Council, which itself will report to the Fifth Session
of the Ministerial Conference.  See paragraph 37 of the Doha Ministerial Declaration (WT/MIN/(01)/DEC/1).
18 Paragraph 24 of document IP/C/W/128.
19 For example, see the reports submitted in the year 2002 by the European Communities and their
member States and by Switzerland circulated in documents IP/C/W/377/Add.7 and 9, respectively.
20 "The goal of WIPO NET is to support the deployment of adequate local infrastructure in Intellectual
Property Offices, with special attention to those in developing countries, providing the necessary software andhardware that would allow these offices to connect to the Internet and to benefit from certain communication
and information services.  In conjunction with the deployment of the network, WIPO would provide technicalexpertise and assistance in areas of legal advice, infrastructure development, capacity building and training."
Paragraph 453 of the WIPO Survey.  For more information on digital delivery of intellectual property services,
see paragraphs 430-506 of the WIPO Survey.
21 Paragraph 27 of IP/C/W/128.
22 Report (1998) of the Working Group on the Interaction between Trade and Competition Policy to the
General Council (WT/WGTCP/2), paragraphs 112-122.
23 Issues related to electronic commerce have been  recently addressed in the Final Report of the
International Competition Policy Advisory Committee (ICPAC) to the Attorney General and the Assistant
Attorney General for Antitrust of the US Department of Justice.  While affirming the potential for the growth ofelectronic commerce to enhance competition in diverse ways, the Report also emphasizes the potential for anti-competitive practices and the continuing relevance of competition law disciplines in this field.  In particular, itrefers to the potential for traditional anti-competitive practices such as cartels, price signalling and the anti-competitive tying of sales through the Internet in additio n to the possibility of network effects that would create
the potential for the accumulation of market power and rela ted abusive practices as issues that merit continuing
attention by policy-makers.  The Report also refers to the danger of "hidden mercantilism" in the form of new orincreased interventions by governments or firms in  the field of electronic commerce that could reduce
competition in national or global markets.
23  See U.S., International Competition Policy Advisory Committee to
the Attorney General and the Assistant Attorney General for Antitrust, Final Report (2002), paragraphs 289-292.IP/C/W/128/Add.1
Page 5
110(5) of the Copyright Act .24  The report considered whether two exemptions contained in
Section 110(5) of the US Copyright Act met the requirements of Article 13 of the TRIPS Agreement
and were thus consistent with Articles 11 bis(1)(iii) and 11(1)(ii) of the Berne Convention (1971) as
incorporated into the TRIPS Agreement by its Article 9.1  The Panel concluded that one of the two
exemptions in question, the so-called homestyle exemption in subparagraph (A) of Section 110(5),was confined to certain special cases within the meaning of the first condition of Article 13 of the
TRIPS Agreement and, given that it met also the other requirements of Article 13, was thus consistent
with the Berne provisions referred to above.  In the Panel's proceedings the question was raised
whether the development of on-line transmission of music could increase the adverse effects of the
exemption and, therefore, should influence the Panel's assessment of the exemption.  In considering
the potential implications of public communication of works transmitted over the Internet, the Panel
noted that "an authorization is required for the exploitation of protected works in respect of the
exclusive rights protected under Articles 11(1)(ii) or 11 bis(1)(iii) of the Berne Convention (1971)".
25
However, given the lack of experience of the application of the homestyle exemption to such
situations, the Panel said that it could not see how potential repercussions in the future could affect its
conclusions on homestyle exemption.  However, it added that "we also do not wish to exclude the
possibility that in the future new technologies might create new ways of distributing dramaticrenditions of 'dramatic' musical works that might have implications for the assessment of
subparagraph (A) as a 'certain special case' in the meaning of the first condition of Article 13".
26
III. STANDARDS OF PROTECTION
A. COPYRIGHT AND RELATED RIGHTS
WIPO Internet Treaties
12. Paragraphs 31 and 81-83 of the original background note provided information on the WIPO
Copyright Treaty ("WCT") and the WIPO Performances and Phonograms Treaty ("WPPT") (often
referred to as the "WIPO Internet Treaties"), adopted under the auspices of WIPO in December 1996.
Since the circulation of the note, both treaties have entered into force, the WCT on 6 March 2002 andthe WPPT on 20 May 2002.
13. As at 15 April 2003, the following 41 States were parties to the WCT:
Argentina, Belarus, Bulgaria, Burkina Faso, Chile, Colombia, Costa Rica, Croatia,
the Czech Republic, Ecuador, El Salvador, Gabon, Georgia, Guatemala, Guinea,
Honduras, Hungary, Indonesia, Jamaica, Japan, the Kyrgyz Re public, Latvia,
Lithuania, Mali, Mexico, Mongolia, Nicaragua, Panama, Paraguay, Peru, the
Philippines, Moldova, Romania, Saint Lucia, Senegal, Serbia and Montenegro, theSlovak Republic, Slovenia, Togo, Ukraine, and the United States.
14. As at 15 April 2003, the following 41 States were parties to the WPPT:
Albania, Argentina, Belarus, Bulgaria, Burkina Faso, Chile, Colombia, Costa Rica,
Croatia, the Czech Republic, Ecuador, El Salvador, Gabon, Georgia, Guatemala,
Guinea, Honduras, Hungary, Jamaica, Japan, the Kyrgyz Re public, Latvia, Lithuania,
Mali, Mexico, Mongolia, Nicaragua, Panama, Paraguay, Peru, the Philippines,
Moldova, Romania, Saint Lucia, Senegal, Serbia and Montenegro, the Slovak
Republic, Slovenia, Togo, Ukraine, and the United States.
                                                     
24 Document WT/DS160/R, adopted on 27 July 2000.
25 Paragraph 6.152 of document WT/DS160/R.
26 Paragraph 6.153 of document WT/DS160/R.IP/C/W/128/Add.1
Page 6
15. The WIPO Survey summarizes the status of implementation of these treaties as follows:
"For most countries, particularly those already in compliance with existing treaties,
the implementation of the Internet Treaties does not require major rewriting of the
law on copyright and related rights, nor any fundamental change in policy or the
structure of their legal systems.  Typically, a country may need to clarify the scope of
existing rights to add the right of 'making available' on demand.  Because the scope ofrelated rights has traditionally been more limited, additional rights such as moral
rights may need to be added to protect performers or record producers.  Although not
required by the treaties, a country may choose to make adjustments to the limitations
and exceptions to rights it provides.  Finally, each country must provide adequate and
effective legal remedies against the circumvention of technical protection measures
and the deliberate deletion or alteration of rights management information, although
these provisions are drafted generally in the treaties so as to give national legislatorsflexibility in their implementation."
27
Certain other WIPO activities
16. Paragraph 84 of the original background note discussed the protection of audiovisual
performances, rights of broadcasting organizations and the protection of databases.  As noted in that
paragraph, the WPPT does not cover the rights of performers in audiovisual fixations of theirperformances.  In December 2000, a Diplomatic Conference on the Protection of Audiovisual
Performances was held under the auspices of WIPO w ith a view to extending the principles of the
WPPT to audiovisual performances.  While a provisional agreement was achieved on most
substantive issues, agreement could not be reached on whether and, if so, how to regulate the transfer
of rights from performers to producers, including whether such transfers should be internationallyrecognized.  One possible approach considered by the Conference was to regulate this by determining
the law applicable to such transfers.
28  The issue remains on WIPO's agenda.  The WIPO General
Assembly decided, at its meeting in September 2002, that the International Bureau should conduct
informal consultations in the first quarter of 2003 with all interested parties to explore the possibilities
of convening an  ad hoc  informal meeting to address the remaining differences and possible ways of
resolving them.29
17. The WIPO Standing Committee on Copyright and Related Rights is continuing its discussions
on a potential treaty that would update the international norms relating to the rights of broadcasting
organizations in the light of recent technological developments.30  The Committee is also continuing
its consideration of the international protection of non-original databases, the form that such
protection might take, and its economic impact.31
                                                     
27 Paragraph 63 of the WIPO Survey.
28 Article 12 of WIPO document IAVP/DC/33 entitled "Understanding on Provisions of the
Instrument".
29 WIPO documents WO/GA/28/7, paragraphs 41-42, and WO/GA/28/5.  Such informal meeting has
been scheduled for 18-20 June 2003.  For more information, see http://www.wipo.int/copyright/en/index.html.
30 A WIPO Secretariat technical background paper on  the "Protection of Broadcasting Organizations"
was circulated in May 2002 in a WIPO document SCCR/7/8.  The relevant documentation can be accessed athttp://www.wipo.int/copyright/en/index.html.
31 Six studies were commissioned by WIPO on the economic impact of non-original database
protection in developing countries and countries in tran sition.  These studies were  circulated in 2002 in WIPO
documents SCCR/7/2-6 and SCCR/8/6.  A WIPO Secret ariat "Summary on Existing Legislation concerning
Intellectual Property in Non-Original Databases" was circulated in September 2002 in document SCCR/8/3.The relevant documentation can be accessed at http://www.wipo.int/copyright/en/index.html.IP/C/W/128/Add.1
Page 7
B. TRADEMARKS
18. Rights in trademarks and other distinctive signs are territorial, but when such signs are used
on the Internet they become simultaneously accessible irrespective of territorial origin.  Paragraphs
54-61 and 85-87 of the original background note in document IP/C/W/128 discussed certain questions
arising from this tension between territorial systems of protection and the global nature of the Internet.These questions include under what conditions the use of a trademark on the Internet would satisfy
certain requirements where the registrability or maintenance of a registration requires use, as well as
under what conditions and in which jurisdiction(s) the use of a sign on the Internet would constitute
an infringement.  The note also addressed the issue of use and promotion of well-known marks on the
Internet, as well as the relationship between trademarks and domain names.  The following describes
how these issues have been addressed in WIPO's recent work.
Use of trademarks on the Internet
19. Issues relating to the use of trademarks on the Internet were addressed in a "Joint
Recommendation Concerning Provisions on the Prot ection of Marks, and Other Industrial Property
Rights in Signs, on the Internet ("Joint Recommendation"),32 that was adopted by the Assembly of the
Paris Union for the Protection of Industrial Property and the General Assembly of WIPO in
September 2001.33  The WIPO Survey characterizes the Joint Recommendation as follows:
"The Preamble to the Joint Recommendation makes clear that it does not purport to
be a trademark law for the Internet, but is intended to guide the application of existing
national or regional laws with respect to legal problems resulting from the use of a
sign on the Internet.  Emphasizing the 'global nature' of the Internet, the Joint
Recommendation aims at providing the clearest possible legal framework fortrademark owners who wish to use their marks on the Internet and to participate in the
development of e-commerce upon it.  Its purpose is, therefore, to help competent
authorities to determine whether, under the applicable law, the use of a sign on the
Internet has contributed to the acquisition, maintenance or infringement of a mark or
other industrial property right in the sign, or whether such use constitutes an act ofunfair competition, and thereafter to apply appropriate remedies.
The determination of the applicable law itself is not addressed by the Joint
Recommendation, but is left to the principles of private international law, as they are
applied in each Member State. […]"
34
20. The Joint Recommendation is built on three principles.  First, the use of a sign on the Internet
contributes to the acquisition, maintenance or infringement of a trademark or other industrial property
right in the sign in a particular country only if the use has a commercial effect in that country.Second, the Joint Recommendation aims to enable owners  of conflicting rights in identical or similar
signs to use these signs concurrently on the Internet.  To this end, it introduces a "notice and
avoidance of conflict" procedure:  right holders or persons who are otherwise permitted to use a sign
in one jurisdiction are exempt from liability in another jurisdiction up to the point when they receive a
notification of infringement in the latter jurisdiction.  After the receipt of such notification, theycontinue to be exempt from liability if they expeditiously take reasonable measures which are
                                                     
32 The Joint Recommendation is available at http://www.wipo.int/about-
ip/en/index.html?wipo_content_frame=/about-ip/en/development_iplaw/index.htm.
33 These governing bodies decided to "[r]ecommend that each Member State may consider the use of
any of the provisions […] as guidelines concerning the protection of marks, and other industrial property rights
in signs, on the Internet".  Article 1(i) of the Joint Recommendation defines that a "'Member State' means a Statemember of the Paris Union for the Protection of Industrial Property, of the World Intellectual PropertyOrganization, or of both".
34 Paragraphs 155-156 of the WIPO Survey (a footnote in the original document omitted).IP/C/W/128/Add.1
Page 8
effective to avoid a commercial effect in that jurisdiction.  Third, remedies for an infringement in a
particular country must be proportionate to the commercial effect of the use of the sign in that
country.  In general, competent authorities should, as far as possible, refrain from granting "global
injunctions" that would affect the use of the sign outside the jurisdiction in question.
Well-known trademarks
21. The protection of well-known marks was addressed in a "Joint Recommendation Concerning
Provisions on the Protection of Well-Known Marks",35 that was adopted by the Assembly of the Paris
Union for the Protection of Industrial Property and the General Assembly of WIPO in September
1999.36  First, it provides guidelines to assist co mpetent authorities to determine whether a mark is
well-known.  Among the recommended criteria to be considered are the duration, extent and
geographical area of any use and promotion of the mark.  The explanatory notes prepared by the
International Bureau of WIPO and attached to the recommendation state that, although the term "use"
is not defined in the recommendation, for the purposes of its provisions the term "use" should coveruse of a mark on the Internet.  Furthermore, they explain that "[a]dvertising, for example, in print or
electronic media (including the Internet), is one form of promotion".
37  Second, the recommendation
provides that well-known marks must be protected against conflicting marks, business identifiers and
domain names.38  As regards domain names, it is specified that "[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 registered or used in bad faith".
39
Domain names
22. Following its First Internet Domain Name Process, an international process to develop
recommendations concerning the intellectual property issues associated with Internet domain names,WIPO published, in April 1999, its report "The Management of Internet Names and Addresses:
Intellectual Property Issues".  The principal re commendations of this report were implemented
through the adoption by the Internet Corporation for Assigned Names and Numbers ("ICANN") of the
Uniform Domain Name Dispute Resolution Policy ("UDRP") in August 1999.  This procedure, which
entered into operation in December 1999, provides holders of trademark rights with an administrativemechanism for the efficient resolution of disputes arising out of the bad faith registration and use by
third parties of Internet domain names corresponding to those trademark rights.  The UDRP now
applies to disputes in the generic top-level domains ("gTLDs") .com , .net, and .org, the new gTLDs
.aero, .biz, .coop , .info, .museum , .name , and . pro,
40 and those country code top-level domains
("ccTLDs") that have adopted the Policy on a voluntary basis.41
                                                     
35 This recommendation is available at http://www.wipo.int/about-
ip/en/index.html?wipo_content_frame=/about-ip/en/development_iplaw/index.htm.
36 These governing bodies decided to "[r]ecommend that each Member State may consider the use of
any of the provisions […] as guidelines for the protection for well-known marks".  Article 1(i) of therecommendation defines that a "'Member State' means a State member of the Paris Union for the Protection of
Industrial Property and/or the World Intellectual Property Organization ".
37 Sub-paragraphs 2 and 3 of Article 2(1) of the recommendation and the attached explanatory notes.
38 Article 3(1) of the recommendation.
39 Article 6(1) of the recommendation.
40 ICANN has accredited a number of institutions to  administer complaints filed under the Policy,
among which the WIPO Arbitration and Mediation Center is the leading provider.  To date, approximately 8,200
cases have been filed under the procedure.  Of these cases, more than 4,800 were filed with the WIPO
Arbitration and Mediation Center.
41 WIPO launched in August 2000 the WIPO ccTLD Programme, which aims to enhance the protection
of intellectual property in the ccTLDs through cooperation with their administrators.  To date, 30 administratorsof ccTLDs have retained the WIPO Arbitration and Medi ation Center as dispute resolution service provider on
the basis of the UDRP or a variation thereof.IP/C/W/128/Add.1
Page 9
23. WIPO commenced the Second WIPO Internet Domain Name Process in July 2000 to address
abusive domain name registrations of identifiers other than trademarks.  In September 2001, WIPO
published its report on this process entitled "The Recognition of Rights and the Use of Names in the
Internet Domain Name System", and presented it to WIPO's member States and ICANN.  This report
was analyzed by the WIPO Standing Committee on the Law of Trademarks, Industrial Designs and
Geographical Indications ("SCT"), which formulated a set of recommendations.42  T h e s e
recommendations were considered by the WIPO General Assembly at its meeting in September
2002.43  The recommendation concerning country names was remitted for further consideration at the
SCT's meeting in November 2002.44  As a result, the member States of WIPO decided to recommend
that the names and acronyms of intergovernmental organizations ("IGOs") and country names should
be protected against abusive registration as domain names.45  These recommendations were
transmitted to ICANN.46
IV. ENFORCEMENT AND RELATED MATTERS
Liability of service provides
24. Paragraphs 73 and 74 of document IP/W/128 addressed the issue of the liability of service
providers in respect of the transmission and storage of material initiated by others:  to what extentservice providers, who act as intermediaries transmitt ing or storing potentially infringing content, are
or should be held liable for such content and, if so, what remedies should be available.  Given that the
Internet is a borderless medium, it would be important that national approaches to this issues would be
mutually compatible so as to allow global networks and markets to develop smoothly.
25. This issue was discussed in the context of the work leading up to the WIPO 1996 Diplomatic
Conference.  Article 8 of the WCT on the "Right of Communication to the Public" compiles the
various provisions of the Berne Convention on the right of communication into a single provision,
extends the right to all categories of works, and clarifies the application of the right in respect of
interactive on-demand communications.
47 As regards the scope of this right in respect of
intermediaries who provide physical facilities for communication without actively initiating it, theConference adopted the following Agreed Statement:
                                                     
42 The SCT's recommendations are reflected in WIPO document WO/GA/28/3.
43 The decisions of the General Assembly in respect of these recommendations are reflected in
paragraphs 74-81 of WIPO document WO/GA/28/7.
44 The decisions by the SCT concerning country names are reflected in 6-11 of WIPO document
SCT/9/8.
45 The delegation of the United States dissociated itself from the General Assembly's decision on the
recommendation concerning the names and acronyms of IGOs, and the delegations of Australia, Canada and the
United States dissociated themselves from the SCT's decision on the recommendation concerning country
names.
The General Assembly also adopted recommendations concerning certain other identifiers.  It adopted
the recommendation that no particular form of protection of international non-proprietary names for
pharmaceutical substances  would be recommended in the DNS at this time, but that WIPO, together with the
World Health Organization, would continue to monitor the situation and, where necessary, bring any important
developments in this area to the notice of member States;   it adopted the recommendation that WIPO memberStates should keep the issue of trade names  under review and raise it for further discussion if the situation so
required;  it adopted the recommendation that no action was needed in respect of personal names ;  and in
respect of geographical indications , it adopted the recommendation that this issue be reverted to the regular
session of the SCT to decide how to address the issue of the protection of geographical indications in the DNS.
46 For an in-depth examination of WIPO's work relating to domain names, see paragraphs 178-239 and
516-522 of the WIPO Survey.  All the WIPO documentation referred to above can be accessed through theWIPO domain names gateway page at http://ecommerce.wipo.int/domains/.
47 See paragraphs 43-45 of document IP/C/W/128.  Similar provisions are contained in Articles 10 and
14 of the WPPT that deal with the right of making available of fixed performances and of phonograms.IP/C/W/128/Add.1
Page 10
"It is understood that the mere provision of physical facilities for enabling or making
a communication does not in itself amount to communication within the meaning of
this Treaty or the Berne Convention."
While this statement clarifies the scope of the right of communication to the public, it leaves the issue
of liability of service provides to be determined at the national level.48
26. Since the adoption of the WCT in December 1996, the issue of liability of service providers
has been addressed in the legislation of a number of countries.  Some countries have regulated the
issue specifically in relation to copyright, while others have taken a horizontal approach applying the
rules to liability arising under any relevant laws a pplying to the information transmitted or stored.
Below are some examples of such laws.
27. The United States Digital Millennium Copyright Act of 199849 limits the liability of service
providers, under specified conditions, to certain forms of injunctive relief in respect of certain
common activities involving the transmission or storage of material initiated by a person other thanthe service provider.  The conditions include that the service provider complies with a "notice and
take down" procedure that allows the right holder to notify it of allegedly infringing material residing
on its system and require it to take down or disable access to such material after receiving such notice.
Similar laws determining liability of service provider s in the copyright context have been enacted in a
number of countries, including Hungary, Ireland and Singapore.
28. The European Communities Directive on Electronic Commerce,
50 adopted in June 2000,
approaches the same question in a horizontal manner.  Its provisions on liability of intermediary
service providers apply to liability the may arise from the application of copyright or any other
relevant laws.  Subject to certain conditions, service providers may not be held liable for the simple
transmission of information provided by the recipient of the service ("mere conduit"), automaticintermediate and temporary storage of such information with the sole objective of making its onward
transmission more efficient ("caching"), and storage of such information at the request of the recipient
("hosting").  In the case of hosting, the servi ce provider, upon obtaining knowledge or awareness that
the activity is illegal, must expeditiously remo ve or disable access to the information.  The EC
member States may not impose on service providers any general obligation to monitor the informationtransmitted or stored.  Also Japan has approached the regulation of service provider liability in a
horizontal manner in its "Provider Liability Law", enacted in November 2001.
51
                                                     
48 The agreed statement may be read together with the following explanatory notes on draft Article 10,
which later became Article 8 of the WCT:  "The relevant act is the making available of the work by providingaccess to it. What counts is the initial act of making the work available, not the mere provision of server space,communication connections, or facilities for the carriage and routing of signals. It is irrelevant whether copies
are available for the user or whether the work is simply ma de perceptible to, and thus usable by, the user."  "It is
strongly emphasized that Article 10 does not attempt to define the nature or extent of liability on a national
level. This proposed international agreement determines only the scope of the exclusive rights that shall begranted to authors in respect of their works. Who is liable for the violation of these rights and what the extent ofliability shall be for such violations is a matter for national legislation and case law according to the legaltraditions of each Contracting Party."  Paragraphs 10.10 and 10.21 of WIPO document CRNR/DC/4 entitled"Basic Proposal for the Substantive Provisions of the Treaty on Certain Questions concerning the Protection of
Literary and Artistic Works to be Considered by the Diplomatic Conference".
49 Pub. L. No. 105-304, 112 Stat. 2860, 2876.
50 Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on Certain
Legal Aspects of Information Society Services, in par ticular Electronic Commerce, in the Internal Market.
51 Law No. 137 of 30 November 2001.IP/C/W/128/Add.1
Page 11
Private International Law
29. Paragraphs 68-72 of the original note in docum ent IP/C/W/128 highlight certain jurisdictional
questions that relate to the use of intellectual property over the Internet.  Under the WTO Work
Programme on Electronic Commerce, the question of "jurisdiction and applicable law/other legalissues" has been identified by delegations as a cross-cutting issue.
52
30. When a court is faced with a case involving a foreign element, it has to decide whether it
possesses jurisdiction, and, if so, it has to decide the law applicable to the case.  The third stage
concerns the recognition and enforcement of foreign judgements.  These issues have been addressed
by national courts for long, leading to the gradual development of municipal law regulating these
classic issues of private international law.  What is particular for electronic commerce over global
information networks is that it vastly increases the occurrence of potential disputes with foreignelements.  The global nature of the Internet and the market-place it creates increases pressure to find
compatible solutions to jurisdictional and choice of law questions, but at the same time it increases the
complexity of the issues involved.  As the technology and the market-place have developed, legal
responses to these questions have continued to evolve under national jurisdictions.
31. Discussions on a new multilateral instrument have been under way under the auspices of the
Hague Conference on Private International Law ("the Hague Conference")
53 since 1992.  In June
2001, a Diplomatic Conference was held under the auspices of the Hague Conference to consider a
convention on jurisdiction and the recognition and enforcement of foreign judgements in civil and
commercial matters.  This was to be the first session of the Diplomatic Conference to be conducted in
two stages.54  Among the main difficulties that have arisen in these discussions are the implications of
e-commerce and the Internet on the new instrument, and how the instrument should treat intellectual
property disputes. The kinds of questions that have arisen in regard to e-commerce include whether
jurisdiction should be only exercisable by the courts of the country in which the source of the
transmission is located ("country of origin") or anywhere the information, goods or services are
received ("country of destination").  Another general question is whether the mere accessibility of awebsite in the forum suffices to support a claim for jurisdiction , or whether the website would need to
have actual effects
55 in the forum before a court should exercise jurisdiction over companies that have
established such websites.56  As regards the protection of intellectual property rights, there have been
discussions on whether there would be need to treat this area in a special way.  Among the specific
questions is whether a country where an industrial property right has been registered should have
exclusive jurisdiction in proceedings concerning that registration, including where the question of the
validity of that registration arises as an incidental question in infringement proceedings in anotherjurisdiction.
57  Discussions on a new multilateral instrument on jurisdiction, recognition and
enforcement of judgements in civil and commercial matters are continuing under the auspices of the
                                                     
52 A list of cross-cutting issues identified by delegations can be found in attachments to documents
WT/GC/W/436 and 475.
53 The Hague Conference on Private International Law is an intergovernmental organization, the
purpose of which is to work for the progressive unification of the rules of private international law.  Moreinformation is available on the Organization's website at http://www.hcch.net.
54 A draft text of the convention is contained in a Hague Conference document entitled "Summary of
the Outcome of the Discussions in Commission II of the First Part of the Diplomatic Conference 6-20 June2001", which is available at http://www.hcch.net/e/workprog/jdgm.html.
55 Cf. the WIPO Joint Recommendation which provides that, for the application of domestic trademark
laws, the use of a trademark on the Internet is relevant only if the use has a "commercial effect" in the country inquestion.  The Joint Recommendation does not address the issues of jurisdiction and applicable law.
56 For more information, see a Hague Conference Prel. Doc. No 17, February 2002, entitled "The
Impact of the Internet on the Judgements Project:  Thoughts for the Future", available athttp://www.hcch.net/e/workprog/jdgm.html.
57 For an in-depth discussion on private international law and intellectual property, see paragraphs 260-
311 of the WIPO Survey.IP/C/W/128/Add.1
Page 12
Hague Conference.  They have recently concentrated on a possibly more limited convention, focusing
in particular on choice of court clauses in business-to-business ("B2B") cases.58
                                                     
58 An informal working group, set up in 2002, has elaborated a draft text focusing on certain core areas,
namely on choice of court agreements in B2B cases (Prel. Doc. No 8, March 2003).  At its meeting in April
2003, the Special Commission on General Affairs and Policy of the Conference requested the Secretary General
of the Permanent Bureau to communicate this draft to the Hague Conference member States.  He was instructedto ask them to inform him, before the end of July 2003, whether they would agree that this text should be put asthe basis for work before a Special Commission to be convened in December 2003, with a view, in due course,to be forwarded to a Diplomatic Conference.IP/C/W/128/Add.1
Page 13
ANNEX
TRIPS COUNCIL DOCUMENTATION ON ELECTRONIC COMMERCE
Document
referenceSubmitted by Title Date of
Circulation
JOB(02)/1559WIPO Activities of Relevance to the Work of the
Council for TRIPS4 March 2002
IP/C/W/286 Switzerland Work Programme on Electronic Commerce 22 June 2001
IP/C/W/26460Cuba Need for Unrestricted Global Electronic
Commerce16 May 2001
IP/C/W/233 Australia Electronic Commerce Work Programme 7 December 2000
IP/C/20 Chairman of the
CouncilWork Programme on Electronic Commerce;
Progress Report by the Chairman to the GeneralCouncil4 December 2000
IP/C/W/224 European
CommunitiesWork Programme on Electronic Commerce 17 November 2000
IP/C/18 Council for
TRIPSWork Programme on Electronic Commerce;
Progress Report to the General Council30 July 1999
IP/C/W/149 United States Work Programme on Electronic Commerce 14 July 1999
IP/C/W/147 India Work Programme on Electronic Commerce 13 July 1999
IP/C/W/145 Japan Work Programme on Electronic Commerce 13 July 1999
IP/C/W/144 Australia Work Programme on Electronic Commerce 6 July 1999
IP/C/W/140 European
CommunitiesWork Programme on Electronic Commerce 7 May 1999
IP/C/1661United States Work Programme on Electronic Commerce 12 February 1999
IP/C/W/128 Secretariat Work Programme on Electronic Commerce;
Background Note by the Secretariat10 February 1999
__________
                                                     
59 The document provides information on WIPO's activities of relevance to matters before the TRIPS
Council, including electronic commerce.
60 Also circulated as document WT/GC/W/435, G/C/W/254, S/C/W/193 and WT/COMTD/W/87.
61 Also circulated as document WT/GC/16, G/C/2, S/C/7 and WT/COMTD/17.