Intellectual Property Rights ?

Philosophical Justification

 

This part of the essay will analyse the question what philosophy justifications in intellectual property rights are available and whether intellectual property is really a property or not? It could be argued that Property is the relationship between an entity and a rational free agent. A property is a property when it is owned by someone but a property is not a property when it is not owned by someone, though it may be potentially a property if it can be owned. If a property is owned by someone it means the owner has a moral right to exclude others from appropriating it[1]. On the other hand it has been argued by Proudhon[2] that in reality property does not exist because property is only attained. But it could be argued that if property can only be attained than Intellectual property is such that can be produced through one’s mental, physical and investment efforts. Thus could only exist virtually until it was found and ascertained. Proudhon further argues that property should have a proper ownership which is a matter of political morality and should be protected by the coercive force of law.[3] However, as argued above, unlike material objects intellectual property is radically different such as numbers and propositions which have a lack of solidity, extension and are not linked in any causal way to the physical state as compared to houses, cars and computers. The first approach toward intellectual property is the moral justification of these rights. Article 27(2) of the Universal Declaration of Human Rights provides that everybody has a right to protect moral and material interests resulting from scientific, literary or artistic production.[4] The labour, time and resources of the creator create moral and economic rights that mean that whoever wants to benefit from IP should come to an agreement with the creator (Posner, 2003).

One could ask why we should recognise these rights when there is no physical state of the property. This is analysed by Himma[5] using an explanation shared by Justice Stewart in Board of Regents V Roth[6] that there is nothing objectionable about one having an interest in intangible objects. If we do not recognise these interests it would result from a purely meritocratic order as well as rivalry will be an inevitable result[7]. Property institutions fundamentally shape a society[8]. To Wendy J. Gordon a thing which exists can be owned while ownership of a thing which is just a conceptual construct is hard to justify[9]. Gordon further elaborates that all things called property should be treated similarly regardless of physical, institutional and statutory difference.  This gives rights to the creators to use and maintain the contents which constitute his or her property. Polinsky and Shavell highlighted that IP rights are composed of possessory rights and the transfer of the possession.[10]

Now if we consider the appropriation of these rights whether those right said be tangible or non tangible. The very fact of ‘appropriation’ will have some ethical as well moral implications. Firstly the moral return to the creator or to the owner is discussed. This ‘morally significant interest’ prevents others to appropriate the contents of the creator without consent and commercially provide incentive and bargain power. But this could only be fair if the property itself is virtual or intangible and has intellectual significant. Second implication is protection rather than prevention or exclusion. This political morality allows the states to make laws to protect the creator that no appropriation of contents takes place and if so it could be dealt with legally[11].

Another significant argument is the natural justification of Intellectual Property rights. John Locke has argued that if a person creates something or improves the value of existing material then he has a right to receive value for that.[12]  Locke’s[13] approach is favoured by Posner and Landes who agree that it is important to provide certain Intellectual Property rights.[14] However with regard to longer protection of IP rights such as copyrights and patents Levine, Boldrin, Gallini, Scotchmer[15] and Kremer came to the view that long term protection can stop future progress and the innovators should be rewarded using salaries or subsidization methods.[16]  Some commentators, such as Boldrin, believed that longer protection for some of the intellectual property such as copyrights and patents can result in monopoly as it is anti-competitive. One major criticism of Locke’s theory was presented by Dowkin[17] as well as by Tavani[18]. They suggest that information should be free because there is a desire for secrets to be told. This does not mean that information should be disclosed which can be against public policies. However it seems that they have just ignored the argument that a creator of IP spends time, labour and other sources to value. Furthermore if creator does not have enough commercial incentives as well as protection from the state laws it is less likely that work is produce.[19] However it should be noted that only protecting the work may not be enough of an incentive but prevention from others to exploit need also be guaranteed. However the protection as well prevention cannot be absolute. Therefore many treaties such as World Intellectual Property Organisation are working effectively on the basis that the protection of IPL is important to achieve socio-economic development.

 Therefore it seems that relationships between individuals, objects and states are not easy to justify[20]. As argued above that people are entitled to enjoy the results of their labour. However not all intellectual property is subject to labour nor is it the work of an individual or a group of people. Actually it is a social product which is based on the prior work of numerous people. Therefore, the inventor cannot be fully credited for his or her creation. Moreover some people are naturally talented or extremely lucky and on the basis of these characteristics they do not deserve anything. Hettinger argued that trade secrets cannot be protected on the grounds of privacy, because corporations are not individuals. However he agreed with the justification of intellectual property on the basis of promoting the creation of more ideas[21]. In response, it could be argued that it is not really relevant whether you are naturally talented or the creation is really the outcome of the hard work or simply luck, therefore it seems that in each case the property is established because the existence of something, whether it is tangible or intangible, is always the outcome of a number of factors such as inspiration, mental and physical labour, dedication and time investment. Although it could further be agreed that it should not be used for personal purposes only, the public should also benefit from his or her inventions but at the same time his input should not be ignored.

This section has considered a range of philosophical perspectives on intellectual property rights and explained the author’s own philosophical standpoint. In the next section intellectual property rights are considered within the context of the discourse on humans rights.

 

Intellectual Property and Economics

 

Intellectual property is a natural field for economic analysis. Investigation into this field has possibly been started by Bentham[22] his approach was more utilitarian. Initially his work was left undeveloped until the 1960s. Coase[23], Becker (1968) Calabresi (1970) and Psoners (1972) than carried on the work of Bentham[24].  Starting point is the question why there should be property rights attached to ‘things’. Simple explanation could be that various incentives are stuck with those very ‘things’. Therefore those rights make the business possible and subsequently economy gets the overall benefit of commercial transactions. However if those rights are not attached, individuals will have no need to effort to trade with each other and as a result there is no need to protect those rights. Hence is the reason that economic analysis of IP rights is based on the provision of incentives to the creators for their work such as copyrights, patents, trademarks of the business and reputation of the actors. Moreover the first approach under the economic perspective of intellectual property is the incentive theory that a creator can enjoy the power of monopoly[25]. The incentive theory is actually the protection provided to creators against those who want to use the contents of the creation without any agreement. This provides a mechanism to pay for the labour, time and investment of someone is set by law. This mechanism also justifies the moral rights of the creators. However it the extent of creator’s rights that more advanced Intellectual Property regimes balances against the potential appropriation of the contents. This balance, once become politically accepted and economically viable makes the incentive reward cycle work. Nevertheless the economic theory provides that the innovators have moral and economic rights toward the society and the economic rights are to bargain for the use of these properties. Plant argued that economic theory is only concerned about patents and that there is no evidence that economic theory concerns protecting the contents of copyrights in the general market[26].

Price discrimination is another economic aspect of intellectual property that really provides the working for incentive theory. It means easy access to intellectual property for individuals and commercial benefit for creators. For example, we can consider copyrights involving the costs of the author and publisher. Once the publisher has published the book he will charge a high price for the first hard copy because the production of the first copy contains the author’s inspiration, time and his mental and physical labour. Furthermore, it encompasses the work of the publisher such as binding, correction and putting it in proper order, so the cost of the first copy is comparatively high but the cost of reproducing this work is not as high as producing the first copy. If the cost of further copies of the original work was the same it would discourage the making of such copies[27]. Landes and Posner further argued that price discrimination produces a number of additional revenues streams such as cable viewing, video cassettes, paperback editions and establishes a proper competitive market. Providing incentives to creators can produce high quality output. It is true that if we remove the incentives from the creators the creator’s interest will diminish but if we provide incentives it will motivate the creator to produce better.

It could also be argued that incentive inevitability creates healthy competition between the creators thus befitting the consumer in many respects. For example, due to competition, creators will be under pressure to create quickly, effectively, credible and better work all the time. Consumer is always ensured that continuous supply of new and improved ‘things’ are being worked upon. This is essential for a robust, modern and intellectually more advance nation.

Moreover incentive approach increases productivity. As Demsetz[28] argued, the role of patents and copyrights is very important especially it controls safely consumer demand. Therefore intellectual property rights not only provide incentives to the creator but also play an important role in consumer welfare. Availability and the speeding up of the inventive progress is the final approach. Under this approach, the one who creates, particularly in the medical and technology fields should not be protected in a way that inhibits future development and academic research but instead such a creator should make their work available to all who can have an input in the further development of the idea. The law provides a tremendous amount of protection to innovators which enable the patent owners to receive value for their innovation. To Kitch in ‘The New Palgrave Dictionary of Economics and the Law 1998’ it is important to have a licensing system in the globalised market to enhance both productivity and protection.

 The other approach to the economic analysis of IP is the Utilitarian theory which provides that societies which protect private property rights are more effective and prosperous than those which do not.  According to Tavani[29] utilitarian theory is actually based on social welfare. However, it is imperative that in a commercially dependent economy even this Utilitarian approach could only be exercised with caution because if on the name of welfare alone incentives are not provided for new creations necessary advancements may be impaired. As a result perhaps more ‘public creations of comfort and welfare’ such as new medicines for general or specific illnesses may not be viable to make thus defeating the whole purpose of a utilitarian approach towards intellectual property rights.

Another important feature of the economic approach to IP is the monopoly system which describes the exclusive rights of the owner to sell in the market without competition. Presumption is that monopoly and property are the same and this assumption is mostly related to patent rights. It is true that monopoly actually has the same characteristics as property such as that no one can take possession of your property unless you transfer the possession to him, similarly no one can compete with you in the market if you have the power of monopoly. Trademark is the monopoly of a commercial identity and a book is the medium of expression of the author. However, it is hard to characterise it as monopoly[30]. As one can see that monopoly argument is not very popular with Utilitarian or professors of incentive approach. However from creator’s point of view the ultimate incentive is monopoly over creations. Most importantly from political and socio economic point of view absolute monopoly rights are very rare.

As argued by David, it is good to have a faster growth in scientific and technology stock and this also benefits not just those sectors but the whole economy. There are also a wide range of social benefits from discoveries and inventions[31].

This section discussed the main components of the economic analysis of intellectual property rights. The final aspect of intellectual property being addressed in this essay concerns database rights, a subject that in recent years has become widely debated.

 

Intellectual Property and Human Rights

 

In recent years, due to globalization and swiftness in accessing information, intellectual property rights have been under focus. Many treaties and conventions have been passed that range from patented medicines to biodiversity, traditional knowledge, web content and webcasting as well as the harmonisation of rules. Inevitably, due to areas influenced by IP Laws, recognition of Human Rights issues has become very important[32].

Human rights and intellectual property rights were once considered two separate fields of law but the realisation of human rights such as the right to health, sharing of knowledge, freedom of information and invention of medicines and the impact of intellectual property rights on it, led the world to reconsider intellectual property rights within the human right umbrella[33]. A well known characteristic of intellectual property is the public welfare[34].

As mentioned above several organisations are working in this regard such as non- governmental organisations (NGOs), the World Intellectual Property Organisation (WIPO), the World Trade Organisation (WTO), the World Health Organisation (WHO) and the Convention on Biological Diversity (CBD). The WTO and WIPO are the two most important lawmaking venues in this regard. One of the important features of these organisations is that they consider developing and developed nations together.  Developed countries tend to argue for substantive rules while developing nations call for a development agenda for reordering the relationship between patents, biodiversity and plants breeder’s rights. These two distinct claims have been under discussion for the last four years at WIPO[35]. When human rights are discussed by the above various organisations in context of IP two distinct approaches are applied, coexistence approach and conflict approach[36].

First approach sees human rights and IP at conflict at fundamental level. This point of view considers the protection of IP rights not only undermining but are also incompetible to various human rights obligations, particullarly in the areas of ecnomic, social, political and cultural rights. Supporter of this approach advocate that the democratic solution to confict between IP and human rights is that later prevails. Second approach, on the face of conflict between IP and Human Rights, presents that approperiate limitations to the IP holder’s rights of monoply over their property proding them with sufficient incentives and rewards while ensuring that consuming public has equitable access to those inventions. Howwver the obvious problem is where the incetive finishes and equitable access starts. More importatntly what method is used to set such perametres. These questions will have various answer depending upon diverce perspectives. Therefore it seems that perfect harmony between IP Laws and Human rights is most difficult to invent.

Nevertheless there has been an increasing demand for reform of the legal protection by businesses and content owners. This has included the adoption of the TRIPS agreement on trade related aspects of IP rights which linked IP from a national level to an international level and the broader vision of IP in economic, political and social value and linked it with human rights implication, including public, health, education, food, agriculture, privacy and for expressions. The 1948 Universal Declaration of Human Rights (“UDHR”) art27 and the 1966 International Covenant on Economic, Social, and Cultural Rights (“ICESCR” or “the Covenant”) art 15 recognise the moral and material rights of creators but they also recognise public rights to benefits from scientific and cultural progress (Chapman, 1998). Further Chapman argued that both of the organisations are not merely based on the concept of moral consideration but should extend the concept to human rights obligations.

However both UDHR and ICESCR recognise the rights to protect moral and material interests of arising from literary artistic and scientific work. It seems that both above rights can potentialy and theoratically can co exist but in practice due to high level of protetions afforded to IP is thought to be on the xpence of compromises of Human Rights. For Example Examples of intellectual property protection that have no human rights basis are those that protect the economic investments of institutional authors and inventors[37].

 

Finally there is also a devision between he western and no western countrys idea of human rights itself. For instance during the UDHR drafting process Britain and United States were reluctant to consider ecnomic, social and cultural rights within the defination of human rights. Western world, especially Britain and USA remained unconvinced and yet divide is almost a stand off. As Glendon noted ‘Western’ obscures the fact that the Declaration’s acceptance in non-Western settings was facilitated by the very features that made it seem ‘foreign’ to a large part of the West: Britain and the United States’[38]. Perhaps it is east-west divide where western countries have more support of liberal economic culture and non western countries side with socio-economic welfare culture. However it seems that Western countries have moved on from the arguments where non Western countries have just discovered them.

 

 

Intellectual Property and Sui Generis Rights

 

Sui Generis rights are only cpable of existing in relation to databases and data base is a collection of independent works, data or other materials arranged is a systimatic or methodical was and individually accessible by electronic or other means[39]. There are two significant points that must be noted in relation to Sui Generis rights. Firstly Sui Generis rights exist independent of any other itellectual property rights that may be and secondly Sui Generis right is only a creation of European Parliment and Council Directive 96/9 on the legal protection of databases (herinafter called Directive). The rapid expansion of information technology in 1990’s brought with it real concern in developed countries partly due to the inconsistent approaches used in the  protection of intellectual property which varied from country to country. This was the reason the EU decided to harmonise the law on database protection. The efforts of the EU took shape in the form of database protection which encompasses a two tier system. The first one requires that member states provide copyright protection for a database that is original and the second tier is to adopt new database rights known as sui generis rights. The latter includes those who fail to qualify as original work. These rights were first implemented in the United Kingdom on 1st of January 1998.[40]

 

Since it only applys to Databases as mentioned above the defination of ‘Database’ need closer exploration. The individual items of data mus be capable of being accessed individually. For example the database must costitute a work in a searchable form therefore literary, musical or dramatic works are more or less excluded from the defination of datatbase[41]. Moreover material arranged must be collated and arranged in a systematic and methodological way in a very precise manor. Therefore west law, lexis or even BT telephone directory will be good examples of fulfilling the meaning within the term database. Under the directive it seems clear that the sui generis rights neither protect the orginal work itself nor its form but only the way in which the information is presented, collated and accessed. Therefore in essence it is the investment of creating that data base is protected in order to guarntee the commercial return to its invester. Technically it is not possible to know how much each database or the systematic ways in which a data is presented need to be different to its competitor. However it could be argued that with EU’s obsecion with compitition laws and free market ethos this may not be incourging for potentioal investors to invest in alternate data bases for commercial perposes. It could equally be argued that approperiate protection is the only way to attarct new investors. If there is no protection investors may not invest at all into data base[42].

 

But Directive does present a more ristrictive approch in allowing the sui generis rights to run forever infact sui generis rights are for 15 years as appose to copy rights that are capable of runnig upto 70 years[43]. Firstly states must provide for a right for the producer of the data base that invested in the quality or quantity, all or in part of creating the data base. Important point is that if sui generis rights only protect the investment than unauthorise use of the contents of a database by a third party will take place in the form of reproduction of the contents or data within another work. If the use is substancial than it will no doubt will constitute infirgment of the sui generis right[44]. The reason being that thid party has used the substancial part of the data base withou investment into it. However the fact remains that if third party has obtianed the same data with verification through legal means than merely presenting it in different format or methodlogy will make this a new investment with its own sui generis right attach to it. Thus competing data bases could be created but they cannot exactly be the same and not at the expence of the other[45]. However there are three exceptions available regarding using the contents of a database lawfully under Database Regulation art 12(2) such as (1) if a person is a lawful user (2) if these contents are used for teaching purposes (3) that a person may infringe copyright in an original database, but not in the database rights in the component data (Sherman,2008). Further articles 10 and 11 of TRIPS provides that computer related programmes should be protected as literary work and anything which is machine readable, whether it is a computer programme or cinematographic work, should be treated the same and that the author or creator shall show their name. This way protection can be provided unless it is the work of an unknown person. Furthermore, article 12, 13 and 14 clarifies rental, production and broadcasting matters.[46]

 

Conclusion

 

Theoretical approaches have created or rather crafted intellectual property rights to their definition and within the sphere of democratic philosophy of social justice. However the reality is that the Intellectual property rights legal regimes rest upon the pillars of incentive and reward. It may have created industrialised style creativity but perhaps non regulation was not an option. Most importantly, as analysed in previous section, intellectual property rights have major conflicts with Human Rights. Since socially, politically and economically commercialism has been accepted the way forward therefore this conflict shall remain, as intellectual property rights are based upon commercial philosophy as appose to Human Rights ideology of social welfare. Nevertheless it seems that with the emergence of globalization and fast electronic media, harmonisation of Intellectual Property laws will manage conflict of laws as well as would produce better regulations to manage creativity.

 

 

 

 

 

 

 

 



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[3] P. J. Proudhon‘What is Property? Or, An Inquiry into the Principle of Right and of Government.

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[5] Himma, op. cit., fn 1

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[9] Gordon, W, J. (October, 2003). ‘Intellectual Property.’ As published in THE OXFORD HANDBOOK OF LEGAL STUDIES, Peter Cane and Mark Tushnet, eds. (Oxford University Press)  pp. 617-646.

[10] Polinsky, A, M. Shavell, S. ‘Economic Analysis of Law.’ (November, 2005) Stanford Law and Economics Olin Working Paper No. 316. Harvard Law and Economics Discussion Paper No. 536.

[11] Himma op. cit., fn 1

[12] See for full details Cases and material in Intellectual Property Law 2nd edition David I Bainbridge. According to the natural law thesis using ideas of someone without permission is theft. This reason was enshrined in the French Patent Law 1791 and by J.R.Meculloch in the campaign for patent law reforms in the 1820s. Bentham’s conclusion of two labour categories also justifies patent principles as physical labour and qualitative difference---skills and mental power use in production. In 1791 Sir William wrote to Lord Kenyon that patent is one of the most important causes of great discoveries.

[13] Locke, J. 1690. “Second treatise of government.”

[14] Posner, R. & Landes, W. (2003), ‘The Economic Structure of Intellectual Property Law’(Harvard University Press 2003)

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[16] Levine, D, K & Boldrin, M. ‘Against Intellectual Monopoly’. (Cambridge University Press 2008) Vol. 21. Art.6. page 130.

[17] Dworkin, R. A matter of principle. Cambridge, MA (Harvard University Press1985)

[18] Tavani , H, T. ‘The Uniqueness Debate in Computer Ethics: What Exactly is at Issue, and Why Does it Matter?’  (2002) Ethics and Information Technology, Volume 4, Number 1, 2002 , pp. 37-54(18)

[19] See for full details Intellectual Property: General Theories encyclo.findlaw.com/1600book.pdf. 

[20] Hettinger, E.‘Justifying intellectual property’ (1989) Philosophy and Public Affairs, 18, 31-52.

[21] Martin, B. (1998), ‘Against Intellectual Property.’  Chapter 3 of Information Liberation, Challenging the corruptions of information power. London: Freedom Press, 1998. Deoxy. deoxy.org/aip.htm.  (Cited 5th December, 2012)

[22] Memoirs of Jeremy Bentham <http://books.google.co.uk/books?id=yNUQAAAAYAAJ&pg=PA77&dq=bentham+intellectual&hl=en&sa=X&ei=G1bzUKLLGIqm0AWi6ICABg&ved=0CEIQ6AEwAw#v=onepage&q=bentham%20intellectual&f=false> accessed 10 January 2013

[23] Deirdre N. McCloskey ‘The good old Coase Theorem and the good old Chicago School; (Steven G. Medema ed. 1998)

[24]Shavell, S & Kaplow, L, ‘The Economic Analysis of La w’ (1999)Harvard Law School; National Bureau of Economic Research. Discussion paper No.251.

[25]Economic Analysis of Intellectual Property’ <www.cyber.law.harvard.edu/bridge/LawEconomics/ip.htm> accessed 10 January 2013

[26] Plant, A. ‘The Economic Aspect of Copyrights.’ (1934) New Series, Vol. 1, No. 2, Pp 167-195.

[27]  Landes, W & Posner, R.  (1989), ‘An Economic Analysis of Copyright Law’  (1989) The Journal of Legal Studies, Vol.18, No.2, PP 325-363.

[28] Demsetz, H. 1967. Toward a theory of property rights. American Economic Review: Papers and Proceedings 57, 347-359.

[29] Tavani, H. (2005) Balancing intellectual property rights and the intellectual commons: A lockean analysis. Journal of Information, Communication, and Ethics in Society, 2, supplement.

[30] Kitch, E, W, ‘Elementary and Persistent Errors in the Economic Analysis of Intellectual Property.’ (November 2000) Vand. L. Rev. 1727.

[31] David, P, A. (1993), ‘The Evolution Of Intellectual Property Institutions And The Panda's Thumb.’ (1993) Stanford University. <www.history.ox.ac.uk/ecohist/readings/ip/david1.doc> accessed 14 January 2013.

[32] Sherman, B & Bently, L. (11 September, 2008).  ‘Intellectual Property Law.’ (3rd edn Oxford University Press 2006)  978-0-19-929204-2.

[33]Jack, D .(2007). ‘The Relative Universality of Human Rights.’ Human Rights Quarterly, Volume 29

[34]Himma, K, E. (2008). ‘The Justification of Intellectual Property: Contemporary Philosophical Disputes.’ Journal of the American Society for Information Science and Technology, Vol. 59, No. 7, May 2008

[35] Helfer, L, R. (2003), ‘Human Rights and Intellectual Property: Conflict or Coexistence?’ Minnesota Journal of Law, Science & Technology, Vol. 5, p. 47, 2003.  Loyola-LA Legal Studies Paper No. 2003-27. Princeton Law and Public Affairs Working Paper No. 04-003

[36] Laurence R. Helfer, Human Rights and Intellectual Property: Conflict or Coexistence?, 5 MINN. INTELL. PROP. REV. 47, 47 (2003)

[37] Audrey R. Chapman, Core Obligations Related to ICESCR Article 15(1)(c), in CORE OBLIGATIONS, 305,

[38] Mary Ann Glendon, A world made new: (2001) Eleanor Roosevelt and the Universal Declaration of Human Rights.

[39] European Parliament and Council Directive 96/9 on the legal protection of databases, Art 1

[40] Bently, L & Sherman, B ‘Intellectual Property Law.’ (3rd edn Oxford University Press 2008) 978-0-19-929204-2. Edition. Paperback. p-311

[41] Andrew McGee, Gary Scanlan, ‘The Database Directive – Sui Generis and Copy Right – a practicable distinction?’ (2005) Journal of Business Law

[42] Iris H-Yu Chiu, Will W. Shen, ‘A Sui generis Intellectual Property Right for Layout Designs on Printed circut boards? An analysis of Current Intellectual Property Laws and Proposal for Reform’ E.I.P.R. 2006, 28(1), 38-50

[43] Bainbridge, D, B, ‘Intellectual Property Law.’(7th edn.Pearson Longman. Edinburg Gate Harlow, Essex, England 2009)

[44] Pt II and Arts 3-5 of the Parliament and Council Directive 96/9 on the legal protection of databases.

[45] [2001] R.P.C. 612 at [78]

[46] ‘Agreement on Trade-Related Aspects of Intellectual Property’ <www.wto.org/english/docs_e/legal_e/27-trips.pdf> accessed 14 January 2013

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