Freedom to innovate – did Government get the message?

Posted on Apr 16, 2017

Freedom to innovate – did Government get the message?

On 27 April, Freedom Day, we will pause to mark the most significant moment in South African history and commemorate the day when freedom, above all else, became the nation’s guiding principle. The day before, World IP Day, we celebrate the achievements of our brethren that influence our every-day lives and the ability of free human intellectual endeavour to improve our lives.

In recent years, Freedom Day celebrations have been reduced to the favourite grandstanding occasion for politicians. While celebrating, many public figures will repeat the customary refrain of this day – remark on the progress made toward Government’s vision of a better life for all and elaborate on a selection of the obstacles that remain. A selection usually based on the popularity of the obstacle and the decidedly non-Governmental cause of the obstacle.

This song is familiar to many and sung without having to think about the words. However, by 2017 the Freedom Day song has acquired an air of superb irony. Our elected leaders’ vision of “a better life for all” feels like a lie, their commitment to freedom a sham, and their list of obstacles to prosperity a blend of blame-shifting, incompetence and pure self-interest.

Freedom Day no longer reminds us of the victory it was, the healing it brought or the hope it inspired. Instead, we look back on the democratic years and are faced with the fact that the biggest obstacle to our liberation is also the one culpable of eroding our freedom.

As South Africa continues the struggle for an egalitarian society based on freedom, dignity and equality, one is reminded of the difficulties of the past, the heroic efforts of our democratic founding fathers and mothers and the extraordinary hope we shared for our future. Ours was to be a society where every voice mattered, each one was guaranteed their safety and we would all be free in the true sense of the word.

The rise of the new dawn promised many things, and among those the dual gifts of freedom to pursue any occupation[1] and freedom to express our thoughts, ideas, emotions and convictions.[2] These rights are enshrined in our Constitution – the same Constitution that serves as the birthday message to every South African on 27 April. This year, one has to ask whether Government has received its birthday message?

The answer must be no, and the South African Post Office will not be to blame.

The day before Freedom Day, 26 April, is World Intellectual Property (IP) Day, celebrated annually by the World Intellectual Property Organisation (WIPO) on the day in 1970 when the WIPO Convention came into force. WIPO, an agency of the United Nations, counts South Africa as one of its 189 member states and leads “the development of a balanced and effective international intellectual property system that enables innovation and creativity for the benefit of all.”[3]

The question most IP scholars and practitioners should ponder this year, on World IP Day and on Freedom Day, is whether our IP system has been leveraged for its tremendous power to benefit all in pursuit of a better society. It is submitted that, when we reflect on the work of Government and the political view it has inspired, the opposite is true. It is clear that all of our freedoms, including the freedom to innovate and benefit from it, have been restricted, diminished and infringed with impunity, and justified with reference to a peculiarly South African, vengeful, selfish and venal Realpolitik that serve the elite few and openly celebrates the fall of our economy.[4]

Interestingly, the theme of World IP day this year is Innovation – Improving Lives to focus on how the IP system, one of the key drivers of economic progress, is “turning problems into progress […] by attracting investment, rewarding creators, encouraging them to develop their ideas, and ensuring that their new knowledge is freely available so that tomorrow’s innovators can build on today’s new technology.”[5]

When compared with Government’s developmental agenda, its position on the knowledge economy, the emphasis on education and the purpose of Universities, the role of IP described above seems to fit perfectly. One may, thus, be excused for thinking that Government has been actively seeking to promote IP.

However, if the IP-related work of Government in recent years is reviewed, a different picture emerges.

For example, the protection of indigenous knowledge (IK) and traditional cultural expressions (TCEs) have been favoured rousing calls of President Zuma for support from, in particular, the House of Traditional Leaders.[6] And yet, the shambles of proposed legislative reforms and proposed Bills[7] take turns to suggest protection for TCEs that are, inter alia, unenforceable, provide copyright protection for everything regardless of its originality, provide for royalty payments to an undefined indigenous community or the State, and remove and deny the protection of South African authors’ work everywhere else in the world.[8]

Meanwhile, those who should benefit from the innovative and creative use of South African materials and expressions are left with little or no legal protection because Government cannot decide who should score the popular points.

Similarly, while Government continued to dither on the protection of South African geographical indications such as Rooibos and Honeybush, others, as far away as France and the United States, employed their IP laws to their benefit and, for example, applied to trade mark Rooibos.[9] In the end it was not Government who would serve its people, but a single IP lawyer and academic who had the courage to convince the European Union that these national assets should be protected in the interest of South Africans.[10]

One may, perhaps, excuse Government for vacillating on matters of such importance, but the work actually done does not reveal anything more favourable.

Firstly, it attempts to provide greater protection for performers so that they may be adequately rewarded for their efforts, and end up proposing less protection that may be transferred at a whim.[11] One cannot help but be reminded of Solomon Linda and the Evening Birds who sold “Mbube” for a measly sum.[12] At the same time, in order to quell the outcry from performers, creators and artist who are not compensated for the use of their work on radio and television, Government suggested a preposterous quota of local content on public and private broadcasters,[13] long before disgraced former SABC COO Hlaudi Motsoeneng claimed it as his idea.[14] If the R411 million net loss at the SABC is anything to go by,[15] there is no clearer proof of a half-baked idea. It is noteworthy that the non-payment that caused the outcry for reform lies squarely at the feet of the South African Music Rights Organisation (SAMRO) and the SABC.[16] It has nothing to do with the copyright system and apparently the SABC is yet again in default of payment to the artists and creators.[17]

Secondly, having perhaps forgotten the sore legacy of Hoodia, it proposes the criminalization of the use of a plant in which another holds a plant breeders’ right and, at the same time, fails to maintain the existing possibility of expropriating such rights in the public interest.[18]

Thirdly, it amends the foreign exchange control regulations, in direct opposition to a judgement of the Supreme Court of Appeal,[19] to classify all intellectual property right as “capital” for purposes of export. Thus effectively placing a ban on the sale or transfer of IP rights to any non-citizen without approval from the SA Reserve Bank, as agent of the Treasury. The net result – your money is not welcome here. By doing so, Government made it so difficult to attract foreign investment, and venture capital in particular, in every creative industry that research and development in technological and socio-economic innovation is likely to continue to decrease.[20]

Fourthly, on the topic of technology, Government’s proposed national policy on IP rights and the related legislative reforms propose that absolutely everything on the internet may be copied for free for educational use, without defining educational use or bothering to consider what that will do to those who make a living from writing educational material. Although this may alleviate the, clearly insurmountable, burden of delivering textbooks, it is perhaps not the most appropriate solution. At the same time, Government proposes criminal sanctions for enabling a digital work to be copied. It does indeed seem contradictory.[21] And yet, in what can only be described as a money-grabbing scheme, Government determines that it shall henceforth own the copyright in all works that do not have an identifiable owner or author and that copyright in such orphan works shall endure forever.[22] Thus, it is apparently in the public interest that individuals may only derive a benefit from their work for a short period but Government may monopolise and profit from the work of others in perpetuity.[23]

Lastly, in the supposed interest of public health, Government proposes fundamental changes to the patent registration system that will severely encumber the process of obtaining legal protection, entail significant expenditure of public funds and ignores the potential impact on foreign investment.[24] Meanwhile, it bans the advertising of all infant formula, foodstuffs for special dietary or medical purposes or feeding aids for infants and young children in all media, along with all trade marks containing a humanised figure. In addition, it censors the manufacturers of all these products from providing any information about the suitability of their products[25] – this in an attempt to promote breastfeeding without any regard for those who must necessarily rely on information about alternatives to breastfeeding. In this case the freedoms to receive and impart information have not only been limited, but absolutely negated. And at the same time Government is content to expropriate these trade marks, without compensation, in blatant disregard for its economic impact on the future of these essential products.

The list goes on, and even when it is limited only to the question of freedom to innovate, the spectrum of abuse is at home in a dystopian society. It is therefore not without cause that Freedom Day celebrations in 2017 will be a rather sad birthday party.

However, our long history of struggle for self-determination and democracy have made South Africans resilient and ever hopeful. Therefore, on World IP Day we will choose to focus on the welcome hope for more sensible legal reform that heeds the voice of all people, and not just the loudest of voices. This hope stems from the Intellectual Property Consultative Framework 2016[26] and suggests that the Department of Trade and Industry, which is responsible for much of the carnage outlined above, has cleaned up its act, changed the guard and is now prepared to undo the damage it has caused.[27]

However, in Government, past behaviour remains the best indicator of future behaviour and our Government has so often shown its willingness to defy and destroy the Constitution. It is therefore with no small measure of scepticism that World IP Day in South Africa will be marked with trepidation for our freedom to innovate, grow, share and prosper. If IP rights are anything to go by, our freedom remains as precarious as ever.

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[1] Constitution of the Republic of South Africa, 1996 Chapter 2 – Bill of Rights, section 22.

[2] Constitution, section 16(1).

[3] World Intellectual Property Organisation Inside WIPO, available at http://www.wipo.int/about-wipo/en/.

[4] See: Peyper L “Gigaba berates govt leaders over reckless downgrade statements” (2017-04-13) Fin24, available at http://www.fin24.com/Economy/gigaba-berates-govt-leaders-over-reckless-downgrade-statements-20170413-2; Madia T “We welcome junk status – ANCYL” (2017-04-07) News24, available at http://www.news24.com/SouthAfrica/News/we-welcome-junk-status-ancyl-20170407.

[5] World Intellectual Property Organisation World IP Day, available at http://www.wipo.int/ip-outreach/en/ipday/.

[6] See for example: The Department of Trade and Industry (the dti), Media Statement: President Jacob Zuma Signs the Intellectual Property Amendment Bill into Law (2014-02-09), available at  http://www.dti.gov.za/editmedia.jsp?id=2989; The Presidency Republic of South Africa,  Address by President Jacob Zuma on the occasion of the Official Opening of The National House of Traditional Leaders (2013-03-07), available at http://www.thepresidency.gov.za/speeches/address-president-jacob-zuma-occasion-official-opening-national-house-traditional-leaders; Daniels, L “South African Traditional Knowledge Protection Bill Amends IP Laws” (2014) Intellectual Property Watch, available at https://www.ip-watch.org/2014/02/19/south-african-traditional-knowledge-protection-bill-amends-ip-laws/.

[7] The Intellectual Property Law Amendment Bill B 8B-2010; The Draft National Policy on Intellectual Property 2013 GG 4 September 2013 No 36816; The Protection, Promotion, Development and Management of Indigenous Knowledge Systems Bill 2016 GG 8 April 2016 No 39910.

[8] See for example: Karjiker, S “The Protection, Promotion, Development and Management of Indigenous Knowledge Systems Bill, 2016: Has the DST lost its resolve?” (2016) IPStell, available at http://blogs.sun.ac.za/iplaw/2016/04/18/the-protection-promotion-development-and-management-of-indigenous-knowledge-systems-bill-2016-has-the-dst-lost-its-resolve/; Karjiker, S “A Better Second Attempt – Protection of Indigenous Knowledge” (2015) IPStell, available at http://blogs.sun.ac.za/iplaw/2015/04/08/a-better-second-attempt-protection-of-indigenous-knowledge/; Klein, M “Draft Protection, Promotion, Development and Management of Indigenous Knowledge Bill, 2014” (2015) IPStell, available at http://blogs.sun.ac.za/iplaw/files/2015/05/Written-comments-on-the-Indigenous-Knowledge-Systems-Bill-2014-Dr-MM-Kleyn-May-13-2015.pdf; Fellows of the Anton Mostert Chair of Intellectual Property Law, Stellenbosch University “Unveiling the Wolf” IPStell (2014), available at http://blogs.sun.ac.za/iplaw/2014/02/11/unveiling-the-wolf/; Dean OH, Jooste C, Karjiker S & Kleyn M (2013) “Comments on the Draft National Policy on Intellectual Property 2013” published by the Anton Mostert Chair of Intellectual Property, available at http://blogs.sun.ac.za/iplaw/files/2013/09/COMMENTARY-ON-THE-DRAFT-NATIONAL-POLICY-ON-INTELLECTUAL-PROPERTY-CIP.pdf; Dean OH “The Winning Choice For Traditional Culture” (2013) IPStell available at http://blogs.sun.ac.za/iplaw/2013/07/20/the-winning-choice-for-traditional-culture/;

[9] See for example: Smith, D “South Africa fights to protect rooibos tea name after French trademark bid” (26 July 2013) The Guardian, available at https://www.theguardian.com/world/2013/jul/25/south-africa-rooibos-tea-france; Staff Reporter “Government objects to French firm’s attempt to trademark ‘rooibos’” (22 February 2013) Mail & Guardian, available at https://mg.co.za/article/2013-02-22-dti-objects-to-french-firms-attempt-to-trademark-rooibos.

[10] See: Jooste, C “The Rooibos Rush” European Intellectual Property Review  Vol 36 Issue 1 (2014); original text available at http://blogs.sun.ac.za/iplaw/2013/08/06/the-rooibos-rush/.

[11] See: Karjiker S “Written comments on the draft Performers’ Protection Amendment Bill [B24-2016]” available at http://blogs.sun.ac.za/iplaw/files/2017/02/Written-comments-on-the-Performers-Protection-Amendment-Bill-2016-copy.pdf; See also: Karjiker S “Performers’ Protection Amendment Bill Commentary” (2017) IPStell, available at http://blogs.sun.ac.za/iplaw/2017/02/05/performers-protection-amendment-bill-commentary/.

[12] See: Dean OH (2013) Awakening The Lion – the case of The Lion Sleeps Tonight, Tafelberg; See also Jooste, C “’Awakening The Lion’ – Portraying The Tip Of The Iceberg” IPStell, available at http://blogs.sun.ac.za/iplaw/2013/02/01/awakening-the-lion-portraying-the-tip-of-the-iceberg/.

[13] See: Dean OH, Jooste, C, Karjiker S & Kleyn M “Commentary on The Copyright Amendment Bill 2015” (2015) available at http://blogs.sun.ac.za/iplaw/files/2015/08/CIP-Formal-Comments-Copyright-Amendment-Bill-2015-Online1.pdf; See also Dean OH “DTI Dishes Up A Hopeless Curate’s Egg” IPStell (2015), available at http://blogs.sun.ac.za/iplaw/2015/08/05/dti-dishes-up-a-hopeless-curates-egg/.

[14] Mkentana L “Hlaudi ‘stole 90% local content idea’” (2016-07-06) Cape Times available at http://www.iol.co.za/capetimes/news/hlaudi-stole-90-local-content-idea-2042563.

[15] See: Ferreira T “Will the SABC say bye-bye to 90%?” Channel24 (12-04-2017), available at http://www.channel24.co.za/TV/News/will-the-sabc-say-bye-bye-to-90-20170412; See also: Van Zyl G “90% local content policy could cost SABC in future, says media expert” Mail & Guardian (2016-09-29), available at https://mg.co.za/article/2016-09-29-90-local-content-policy-could-cost-sabc-in-future-says-media-expert/.

[16] See: The Department of Trade and Industry (the dti) Copyright Review Commission (CRC) Report 2011 p 57 para 8.1.7 et seq., available at http://www.gov.za/sites/www.gov.za/files/CRC%20REPORT.pdf; See also: Dean OH “DTI Dishes Up A Hopeless Curate’s Egg” IPStell (2015), available at http://blogs.sun.ac.za/iplaw/2015/08/05/dti-dishes-up-a-hopeless-curates-egg/.

[17] See: Ferreira T “SABC facing fresh cash crisis – report” fin24tech, available at http://www.fin24.com/Tech/Companies/sabc-facing-fresh-cash-crisis-report-20170313.

[18] See: Cochrane D “Criminal Plants – New Plant Breeders’ Rights Bill” (2015) IPStell, available at http://blogs.sun.ac.za/iplaw/2015/02/18/criminal-plants-new-plant-breeders-rights-bill/.

[19] Oil Well (Pty) Ltd v Protec International Ltd and Others 2011 (4) SA 294 (SCA); See also: Dean O H Handbook of South African Copyright Law 14ed (2012) p 1-143 para 12.4.

[20] See: Karjiker S “Assignments of IP to non-residents: the amended Exchange Control Regulations” (2012) IPStell, available at http://blogs.sun.ac.za/iplaw/2012/07/03/assignments-of-ip-to-non-residents-the-amended-exchange-control-regulations/; Van Niekerk R “A limited victory: IP and exchange control” (2014) IPStell, available at http://blogs.sun.ac.za/iplaw/2014/10/24/a-limited-victory-ip-and-exchange-control/.

[21] See: Jooste C “A Diamond in the Rough – Technology and the Copyright Amendment Act” (2015) IPStell, available at http://blogs.sun.ac.za/iplaw/2015/08/19/a-diamond-in-the-rough-technology-and-the-copyright-amendment-act/.

[22] Copyright Amendment Draft Bill Government Gazette 27 July 2015 No 39028 section 3(3)(c), 21(3) and 22.

[23] Dean OH, Jooste, C, Karjiker S & Kleyn M “Commentary on The Copyright Amendment Bill 2015” IPStell (2015) 5, 9 & 52-5.

[24] See: Karjiker S “A Better Second Attempt – Protection of Indigenous Knowledge” (2015) IPStell, available at http://blogs.sun.ac.za/iplaw/2015/04/08/a-better-second-attempt-protection-of-indigenous-knowledge/.

[25] See: Mills L “The Regulations Relating to Foodstuffs for Infants And Young Children (R 991): A Formula For The Promotion Of Breastfeeding Or Censorship Of Commercial Speech?” Potchefstroom Electronic Law Journal, Vol 17, Issue 1, Jan 2014, p. 252 – 295; See also: Mills L “Formula For Plain (Bland) Packaging” (2013) IPStell, available at http://blogs.sun.ac.za/iplaw/2013/12/03/formula-for-plain-bland-packaging/.

[26] The Department of Trade and Industry (the dti) Intellectual Property Consultative Framework – as approved by Cabinet on 6 July 2016 available at https://www.thedti.gov.za/news2016/IPConsultativeFramework.pdf.

[27] See: Ann C, Dean OH, Karjiker S & Kleyn M “Comments On the Intellectual Property Consultative Framework, 2016” (2016) IPStell, available at: http://blogs.sun.ac.za/iplaw/files/2016/08/IP-Consultative-Framework-Comments-CIP.pdf.

Cobus Jooste