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Institute for Legal Questions on Free and Open Source Software

Will the E-Commerce Provisions in the Trade in Services Agreement (TISA) erode FOSS?

By Sylvia F. Jakob

On 3rd June 2015 Wikileaks released a confidential document on Electronic Commerce as currently discussed by the USA, Japan, the EU and 21 other countries (excluding the BRIC States) in the TISA negotiations.

TISA aims at liberalizing the worldwide trade of services such as banking, health care and transport,. But  it also deals with telecommunication services and electronic commerce. As such TISA complements the TTIP negotiations.

Particular reason for concern seems to pose Art. 6 of the leaked document

Article 6: Transfer or Access to Source Code

1. No Party may require the transfer of, or access to, source code of software owned by a person of another Party, as a condition of providing services related to such software in its territory.

2. For purposes of this Article, software subject to paragraph 1 is limited to mass-market software, and does not include software used for critical infrastructure.

The EFF believe that this provision will prohibit countries from enacting “free and open source software mandates” without ,however, explaining why.

Beuth goes a step further and maintains that this provision, if enacted, would prevent countries from initiating public tenders in which free and open Source software was a prerequisite. As such, authorities would have to allow companies such as Microsoft to take part in public tenders, instead of limiting the offerors to Linux Distributions.

This contribution will try to strike a balance:

The draft Art. 6 should be understood from the background of IT-Firms, who are the rightful copyright holders of software and who have a particular economic interest in not disclosing their code to service providers in a vertical market.

That the provision is not yet fully developed, goes without saying. We  do, for instance, not know what exactly will be defined as “services”.  Will research and innovation also count as a service? If so, will there be special exceptions as currently contained in the Computer Program Directive 2009/24/EC, particularly in Art. 5 and 6? Neither do we do  know  to what extent  the draft provisions may breach  other bilateral or multilateral agreements, including the WTO or GATS, as they are -after all - just drafts.

As to the EFF´s position: Free and Open Source Software (FOSS) will not be “owned” by any party, who will be unwilling to provide source code. On the contrary:There is either no “owner “of an open source product, as it was composed by a multitude of free software developers keen to open it up for the whole world. Or  there is an owner, but one with a clear mission. This can either be a foundation, conceived to uphold the idea of FOSS, or a company that discovered FOSS´ benefits and changed its business model accordingly. Neither would fall foul of  the above provisions which do not question the basis on which FOSS relies, namely  the international and national copyright regimes. As long as software developers may license their contributions under FOSS licenses, FOSS will flourish. Open v. Closed source becomes a matter of choice.

The assumption that a Free Trade Agreement will provide the basis for turning back the wheel of history and wipe out  all legal achievements on and around FOSS is sensational, but nothing more. Fact is that FOSS has become an integral part of most computer driven devices, so that abolishing it would be an economic suicide mission - which can hardly be in the interest of the drafters.

As to Beuth´s argument:  he may  have a prima facie point, but the consequences are less dramatic than pictured. Should Open Source have to compete against Closed Source - may the better win. There are already indicators, that FOSS architecture is better documented and less prone to error than closed source software developments.

All in all,  there is no doubt that the TISA discussion process should be more transparent.  We should, however, not too readily jump to conclusions when fed with incomplete information.