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Canadian Publishers' Council

Representing Canadian publishing since 1910

Copyright Consultations

The Canadian Publishers' Council (hereinafter referred to as CPC) is pleased to participate in the consultation process initiated by the Ministers of Industry and Heritage.

The CPC, as Canada's main English language book publishing trade association, was founded in 1910 and represents the interests of publishing companies that publish books and other media for elementary and secondary schools, colleges and universities, professional and reference markets, the retail and library sectors. Members employ more than 2800 Canadians and collectively account for nearly three-quarters of all domestic sales of English-language books. Members spend more than $50 million with Canadian-based book manufacturers and pay more than $25 million in royalties to Canada's writers.

The Council represents the Canadian publishing community on the international level in the International Publishers Association (IPA) and is a member of the International Federation of Reprographic Rights Organizations (IFFRO). The CPC also maintains liaison with other Canadian professional publishers' associations, with the Association of American Publishers and the U.K. Publishers Association, as well as with Canadian colleagues in all areas of the literary arts, educational, library and retail communities.

We are passionate about the future of Canada's creative industries and committed to the economic and cultural benefits publishing delivers to our country. We trust our recommendations and comments will address the consultation questions the government has posed to Canadians:

• How should existing copyright laws be modernized?
• How should copyright changes be made in order to withstand the test of time?
• What sorts of changes would best foster innovation and creativity in Canada?
• What sorts of changes would best foster competition and investment in Canada?
• What sorts of copyright changes would best position Canada as a leader in the global digital economy?

Copyright Reform

Respect for copyright

Copyright legislation is specifically intended to incent a creator to make their works available to the public with the confidence that their right to make the work available, to be reasonably compensated, receive attribution and ensure the integrity of the work (moral rights) will be respected. Before the advent of copying machines and now digital technologies the opportunity and the desire for the public to impinge on any of these rights was limited.

In this rapidly changing environment restatement of principles would be valuable.

Recommendations:

• Include a clear statement as to the purpose and objectives of legislation as follows:
  • Copyright is property.
  • Creators are entitled to a rightful reward and to respect for their creation.
  • Copyright will incent innovation and innovation and investment will benefit the public.
• Include a clear statement granting the making available right and distribution right for all creators.

International Obligations

Bill C-61 articulated a need to have a made-in-Canada solution. Certainly Canada does not have to replicate the approach of any particular country. However, copyright reform cannot result in a regime that is disconnected from international norms. A detailed analysis of Bill C-61 showed Canada to be frequently out of step with those norms.

Still Canada has undertaken to meet the standards set out in the WCT and WPPT with respect to the making available right, technological protection measures, limits on exceptions for education, libraries, ISPs and private use. For Canada to compete in a global information marketplace we must deliver to our international colleagues a predictable and respectful framework.

Recommendations:

• Ratify the WCT and WPPT.

Balance

Both recent bills to amend copyright (Bill C-60 and Bill C-61) reflected the proposition that copyright legislation's objective is to balance the interests of the creator and the public.

The fallacy of the balance concept is in the assumption that the protection of a rights holder's interest must deprive the public of rights to enjoy the creation (the zero sum game). There is also the perception that "user" good is always equal to "public" good. In fact, a healthy copyright regime that creates a nurturing environment for creativity and innovation is also in the "public" good. The notion of "them against us" is disturbing and it is hoped that in copyright reform the government can reflect the objectives of copyright law in a manner that is less polarized.

An overwhelming challenge is to determine what balance is when one size needs to fit all. A solution to address the "balance" or the user demands needs to accommodate the entertainment sphere (music and movies) art, journals, educational treatises, novels, poetry, photography, information databases, news — an astounding range of creative works and an equally varied set of business models. It also needs to address not just consumption of creative works but transformative uses. A creator should not be able to unreasonably curtail new creations but new creators should also not be able to coat-tail on another's creation with no attribution, permission or compensation. Mash-ups derive much of their value from recognizable elements of the original works. New technologies have made this type of work much more prevalent than in previous eras. That doesn't equate to fair or to balance. When recognizable elements of a copyrighted work are used and they are a substantial part of the new work the consent of the rights holder of the original work must be required.

When "balance" does not seem to be achievable, the objective of copyright to advance the creators' interests must be given priority. We reiterate that the "public" good is served by a strong creator community — not only are creators compensated but there are many businesses within the community that achieve international stature for Canada, employment and investment in the future.

Recommendations:

• Balance is not in and of itself an objective of copyright. It is a metric for assessing and determining whether the legislation meets Canadian needs. International standards, fair rules and the fostering of innovation are also essential factors in that assessment.

Exceptions

Copyright law is intended to establish a default set of rights and exceptions to those rights. A creator can choose to permit greater access, establish different and less restrictive terms and conditions, can take advantage of Creative Commons licensing models or can "give it all away — for free". It is important to remember that it is the creator who makes that choice not the user. A creator who chooses to use the rights provided by the legislation should not be derided. Not all musicians want to hit the concert tour or sell T-shirts and mugs instead of getting compensated for the music.

International norms and treaties (Berne, GATT/TRIPS) have endorsed the three-step test limiting the scope of exceptions to copyright protection, as follows:

• Only certain special cases
• No conflict with normal exploitation of the work
• Not unreasonably prejudicial to the legitimate interests of the rights holder.

Fair Dealing

Replacing Canada's fair dealing with the U.S. fair use approach is scarcely a "made-in-Canada" approach. Either the Canadian courts will need to adopt the principles established by US courts, hammered out over decades of litigation, or the definition of fair use in Canada will be in flux until sufficient jurisprudence has developed to provide guidance on the interpretation of "fair". This is not flexibility. It is ambiguity. A model that relies on litigation to define its boundaries is costly for the parties, for predictability and may disincent investment. To deliver the predictability that ensures creativity and investment and gives assurance to our international partners an exception needs clearly defined boundaries. See: Why Canada Should Not Adopt Fair Use: A Submission to the Copyright Consultations. ¹

Adding terms like "such as" to the fair dealing provision (the made-in-Canada fair use) will seriously impact the balance of many other provisions in the Act. The Canadian context both legislatively and culturally is not the same as the US. CCH has suggested that fair dealing is a right but fair use in the US is a defence to infringement. The implications of that distinction may be profound. Canada's copyright regime also respects the concept of moral rights, a protection for creators not included in US copyright legislation.

The Canadian government has evaluated the fair use option and the recommendations were negative. ²

The desire of a consumer of intellectual property to copy a purchased work, whether music or text or art or photograph, for multiple uses and purposes particularly now with the exponential access to digital technology needs to be addressed in a manner that does not devastate the interests of the rights holder. It seems perverse to entertain expanding the "entitlement" of the user but not the accountabilities. The issue of a consumer's "entitlement" to copy part or all of a work is not going to be resolved by expanding fair dealing beyond its intended purpose. The suggestion that a person should have a "personal" and "flexible" right to copy a work for every desired purpose may sound attractive for the consumer but it will seriously undermine copyright's clearly stated objective to incent and to compensate creators and to protect their moral rights in the integrity of their creations.

Recommendations:

• Canada should not adopt a fair use model.

Library Exception

When the library exception was introduced in 1997 the publishing community was gravely concerned about the potential impact on journals and newspapers. A promised review was never done. The proposed expansion of the exception to permit digital copies to be created and to be distributed through inter-library loan can only result in fewer libraries maintaining full collections of journals and newspapers. The commercial viability of existing journals and newspapers could be seriously impaired and there will be a reduction in incentive for publishers and creators to explore new services as well as new business models.

A review may be impossible since there are no record keeping requirements, no restrictions on frequency of requests, no sensible way to determine that the digital copy is not distributed further.

The creator gets no compensation from this use. The compensation, in fact, may be reduced by the elimination of sales of the original. Since digitization pursuant to this exception would be outside of the collective licence this copying would not be reported and there would be no compensation to the rights owner.

Recommendations:

• Do not expand the library exception to permit digitization and inter-library loan of digital copies to patrons of other libraries.
• If introduced, limit to materials not covered by commercial or collective licence, require the destruction of intermediary copies, require record-keeping.

Educational Exceptions

The proposed exceptions for the educational community are overly broad.

Distance Learning

The members of the Canadian Publishers' Council include several publishers who develop materials for the educational community — K-12, post-secondary and post-graduate. They have been developing tools and working with the institutions for the delivery of materials for distance learning for well over a decade. So the exception for the delivery in digital form of materials used by students actually in the classroom cannot be so broad that it encompasses materials for which there is a commercially available digital offering. The ambiguity of the definition of "lesson" in both Bill C-60 and Bill C-61 needed to be clarified.

An exception must be balanced with obligations to ensure distribution is exclusively to students, that the fixation is limited to the duration of the course and that usage is tracked. Compliance with a requirement to establish "measures" to provide these controls must be a condition of being able to rely on the exception.

Recommendations:

• Define educational institution.
• Define lesson.
• Exclude materials marketed primarily for use over digital networks.
• Define relationship of material with class session and instructional activities.
• Require use of "measures" that are clearly defined and consistent with international standards such as the use of technological protection measures, undertakings from distance learning students and clear compliance with a copyright policy (institution must have one) that includes record-keeping.

Publicly Available Materials on the Internet Exception

The educational community proposed this exception — that all publicly available material on the internet should be available for educational or training purposes. Educational or training purposes are not defined. Publicly available is defined as anything that is not protected by a technological protection measure. This exception changes the fundamental principle of copyright under the Berne convention that formalities are not required to assert copyright. Not only does it affect materials that have made no reference to copyright but it would include materials where copyright notices and terms and conditions clearly indicate that permission of the copyright owner is required for use. There are no "fair dealing" considerations such as quantity or commercial damage. In Bill C-61, attribution was required but there were no consequences to the educational community if none was provided. There were no "measures" to ensure there are limits to the dissemination.

This exception completely fails to recognize that many websites and portals are specifically created for educational purposes. These sites are often funded by advertisers and sponsorship — if the content can be removed from the branding wrapper for use in the exact market for which it was intended these funding models will disappear and so will the content. It is naive to expect that innovation and investment will continue in this environment if valuable content is so vulnerable. The outcome of this exception is likely going to be the decrease of content offerings on the internet outside of technological protection measures.

This exception has to undermine the public's understanding of copyright. Our youth will go into the commercial world with an expectation that if content isn't locked up it can be taken. This outcome is contrary to all the stated objectives for copyright reform.

Recommendations:

• Do not create this exception. A well constructed distance learning exception, fair dealing and collective licensing provisions are all that is required.

Personal Uses and Economic Harm

Technology has given consumers of intellectual property infinite opportunities to expand their desired uses. In particular, the development of devices like MP3 players and applications like Bit Torrent has created a voracious appetite for entertainment media products. The "balance" between the rights holder and the consumer in some sectors has been seriously disturbed.

There is ambiguity around what a consumer buys when a creative work is acquired. Is it the tangible form of a work or is it the intellectual property itself? Some digital works never have a tangible form.

The very nature of copyright assumes that the creator continues to have rights in what is done with a work after a transaction. Moral rights, an important element of our copyright regime, absolutely entitle the creator to assert an interest in the continuing integrity of the creation.

Analogies to tangible property are fundamentally flawed — when you buy a car and you choose to give it away you no longer have the car — when you buy a book and you give it away you no longer have the book — when you copy the book and you give away the copy you still have the original. The creator of that work no longer has the prospect of selling the book to the owner of the copy. The fact that the copier received no commercial benefit from the act of copying and sharing doesn't change the nature of the economic harm to the creator.

In some communities of consumers there has developed a pervasive shift of attitude in recent years that copyright is excessive, both in duration and in breadth, that a user is entitled to fully exploit all "personal uses" and possible formats unhindered. There are even those who feel that "sharing" where there is no commercial gain by them is a harmless activity or, if there is harm, it is only the corporate sector that suffers. The discussion boards in this consultation reflect many gradations of these attitudes.

Submissions allude to the "right" to format shift and time shift works. The consumer believes that format shifting, a reflection of the bounty of technological toys available to us today, is harmless. After all, it is the same user that is consuming the work in multiple ways. However, there is a slippery slope towards an assumption that it is, or should be, permissible to share. The perception of time shifting is the same, that is harmless. However, remember that broadcasters and cable companies deliver their services and creative content supported by the business model of advertisers paying for the opportunity to reach the consuming public. Those advertisers are not guaranteed access in a time shifting model. Advertising dollars are not unlimited and those dollars will be directed where they will deliver the best and most predictable results. Losing the "balance" here may result in dramatically reduced content or a far less appealing distribution model.

Rights holders will never be secure without an indication that consumers have internalized the societal norm that access to creative works is a benefit as well as a right and should not be abused. Rights do not come unfettered of responsibilities.

As an aside, privacy laws should not be used as a means to obscure illegal behaviour. Infringers currently can remain virtually untouchable if an intermediary like an ISP or a librarian is involved.

Businesses do not want to be constantly on guard against their customers and, in particular, do not want to be punishing or suing those customers. Protection measures and compliance become significant business costs that increase the cost of the product to the consumer. Toning down the rhetoric and antagonistic behaviour would be a benefit to all. Furthermore a co-operative approach might well deliver the business models that will work for the rights owner and the customer.

Recommendations:

• Exceptions for private uses need to be clear and simple and limited to circumstances where access is inappropriately withheld. The scope of any exception created must be determined using the three-step test.
• Copies can only be made from originals lawfully owned by the maker of the private copy.
• Licences and agreements entered into by the owner of the private copy override this exception.
• Licences and agreements entered into with respect to time shifting override this exception.
• Compliance needs to be incented, creator rights need to be recognized.

Technological Protection Measures and Digital Rights Management

The use of technological protection measures as a fundamental part of delivery and distribution models has become widespread as creators and producers respond to the new reality of digital consumption — both legal and infringing. The cost of developing and using these tools is significant. The unfortunate irony is that the circumvention issue has presented itself as an impediment to access by the consumer community, one that could easily be removed if there appeared to be universal respect for the rights of the creators.

Metadata and rights management are important tools for the copyright owner to ensure proper recognition, compensation and attribution for their work. These tools are also essential for the preservation of original creations particularly in the digital world.

Recommendations:

• Circumvention of technological protection measures must be prohibited except for limited and clearly defined exceptions.
• Criminal sanctions must be available.
• Trafficking in circumvention devices should be prohibited.

Notice and Notice and Notice and Takedown

The proposed Notice and Notice regime as it was conceived in Bill C-61 was excessively weighted towards the "rights" of the ISP intermediary and to the privacy rights of the alleged infringer. There were no obligations imposed on the ISPs to actually follow through with providing notice to the alleged infringer or to take any subsequent action. No speedy remedy was provided to the rights holder. The evidentiary obligations were entirely on the rights holder and the form and content of the proposed notice were onerous. Record retention was ridiculously short — no judicial proceeding could be completed in the 6 months and 1 year time frames proposed. The net effect of the imbalance is that investment in digital content may be slowed and, in particular, investment in indigenous, Canadian content will suffer.

The Act must make it obligatory for ISPs to have a code of practice that includes guidelines as to how to address alleged and proven infringement. There must be escalating sanctions available to address the failure of an ISP to effectively implement a notice and notice process or to address repeat infringements by a user.

A notice and takedown regime will also be required. This is the standard adopted by the United States, the European Union, Australia, Singapore, Japan and New Zealand. This remedy is streamlined and speedy. Any concern of the ISPs that rights holders or others would abuse this process can be addressed by creating civil penalties for false notices and by implementing a counter notification procedure to restore improperly removed material.

Recommendations:

• Notice and notice for alleged infringements must be supported by a code of practice and guidelines for the expected response of an ISP. The ISP's immunity from liability for infringement should be tied to its reasonable implementation of practices to stop repeat infringements by its subscribers.
• Notice and takedown where ISP has actual or constructive knowledge of alleged infringements.
• Civil remedies for false notices.
• Retention of records for defined times more appropriate to length of time required by legal proceedings.

Summary of Recommendations

Respect for copyright

• Include a clear statement as to the purpose and objectives of legislation as follows:
  • Copyright is property.
  • Creators are entitled to a rightful reward and to respect for their creation.
  • Copyright will incent innovation and innovation and investment will benefit the public.
• Include a clear statement granting the making available right and distribution right for all creators.

International Obligations

• Ratify the WCT and WPPT.

Balance

• Balance is not in and of itself an objective of copyright. It is a metric for assessing and determining whether the legislation meets Canadian needs. International standards, fair rules and the fostering of innovation are also essential factors in that assessment.

Exceptions

Fair Dealing

• Canada should not adopt a fair use model.

Library Exception

• Do not expand the library exception to permit digitization and inter-library loan of digital copies to patrons of other libraries.
• If introduced, limit to materials not covered by commercial or collective licence, require the destruction of intermediary copies, require record-keeping.

Educational Exceptions

Personal Uses and Economic Harm

• Exceptions for private uses need to be clear and simple and limited to circumstances where access is inappropriately withheld. The scope of any exception created must be determined using the three-step test.
• Copies can only be made from originals lawfully owned by the maker of the private copy.
• Licences and agreements entered into by the owner of the private copy override this exception.
• Licences and agreements entered into with respect to time shifting override this exception.
• Compliance needs to be incented, creator rights need to be recognized.

Technological Protection Measures and Digital Rights Management

• Circumvention of technological protection measures must be prohibited except for limited and clearly defined exceptions.
• Criminal sanctions must be available.
• Trafficking in circumvention devices should be prohibited.

Notice and Notice and Notice and Takedown

• Notice and notice for alleged infringements must be supported by a code of practice and guidelines for the expected response of an ISP. The ISP's immunity from liability for infringement should be tied to its reasonable implementation of practices to stop repeat infringements by its subscribers.
• Notice and takedown where ISP has actual or constructive knowledge of alleged infringements.
• Civil remedies for false notices.
• Retention of records for defined times more appropriate to length of time required by legal proceedings.

For further information or clarification contact Jacqueline C. Hushion or Catherine A. Campbell.

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¹ Written by Barry Sookman and Dan Glover of McCarthy Tétrault. The research assistance of David Deutsch and Ryan Prescott of McCarthy Tétrault is gratefully acknowledged. (Return to Text)

² Report of the sub-committee on the Revision of Copyright, October, 1985, "A Charter of Rights for Creators". (Return to Text)