ARCHIVED — A SOCAN

COPYRIGHT REFORM PROCESS

REPY COMMENTS

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Documents received have been posted in the official language in which they were submitted. All are posted as received by the departments, however all address information has been removed.

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Reply comment from Society of Composers, Authors and Music Publishers of Canada (SOCAN) received on October 22, 2001 via e-mail

Subject: SOCAN Reply

PDF Version

PRELIMINARY REPLY COMMENTS
TO
INDUSTRY CANADA AND
THE DEPARTMENT OF CANADIAN HERITAGE




GOVERNMENT OF CANADA
COPYRIGHT REFORM PROCESS
LAUNCHED ON JUNE 22, 2001







SOCIETY OF COMPOSERS, AUTHORS
AND MUSIC PUBLISHERS
OF CANADA

SOCAN

OCTOBER 22, 2001

I. INTRODUCTION


On June 22, 2001, the Government of Canada issued the following three documents and launched a process of consultation and reform designed to modernize Canadian copyright legislation:

(1) A Framework for Copyright Reform;

(2) Consultation Paper on Digital Copyright Issues; and

(3) Consultation Paper on The Application of The Copyright Act's Compulsory Retransmission Licence to The Internet.

On September 18, 2001, the Society of Composers, Authors and Music Publishers of Canada/Société canadienne des auteurs, compositeurs et éditeurs de musique ("SOCAN") filed a 24-page Preliminary Submission with Industry Canada and the Department of Canadian Heritage (the "Departments"). The French version of the Preliminary Submission was filed on September 25th.

We understand that the Departments have received about 700 copyright reform submissions. SOCAN welcomes this opportunity to provide preliminary reply comments and we reserve our right to provide further reply.

SOCAN also looks forward to meeting with the Departments to further discuss our views and to continuing to play an active role in the consultation process.



II. PRELIMINARY REPLY COMMENTS


At this time, we wish to provide some preliminary reply comments regarding the following issues raised in other parties' submissions:

(1) Exceptions and Limitations; and

(2) Internet Service Provider ("ISP") Liability.


1. EXCEPTIONS AND LIMITATIONS

Several parties have raised the issue of exclusions and limitations. For example, in their comments on the Consultation Paper on Digital Copyright Issues, the Association of Universities and Colleges of Canada ("AUCC") concludes on page 23 that:

Collective licensing should be seen as a supplement to, but not a replacement for, limitations and exceptions in our copyright laws.

However, as the Departments stated on pages 1-2 of their consultation paper, A Framework for Copyright Reform:

The Copyright Act provides the legal framework within which creators and other rights holders are entitled to recognition and control of, and payment for, the use of their works. Examples of works protected by copyright are: films, novels, songs, information products and computer programs.

Copyright establishes the economic and moral rights of creators and other rights holders to control the publication and commercial exploitation of their works, protect the integrity of their endeavours, and ensure that they are properly remunerated. The law provides creators and other rights holders with a number of legal rights to authorize the use of works.

Some uses of works are permitted without the rights holder's consent or without the payment of royalties. These are called "exceptions".

In other cases, authorization is not required but creators and other rights holders are entitled to remuneration.

It is therefore clear that there is a fundamental difference between:

(1) the exclusive right of creators to authorize the use of their works;

(2) the right to remuneration of creators who do not have the exclusive right to authorize the use of their works; and

(3) exceptions, where creators have no right to authorize the use of the works and no right to remuneration.

The statement that "collective licensing should be seen as a supplement to, but not a replacement for, limitations and exceptions in our copyright laws", promotes limitations and exceptions, which deprive creators of any right of remuneration.

Stripping creators of their rights is contrary to longstanding international norms. For example, Article 9(2) of the Berne Convention For The Protection of Literary and Artistic Works (Paris Text 1971) ("Berne") states:

It shall be a matter of legislation in the countries of the Union to permit the reproduction of such works in certain special cases, provided that such reproduction does not conflict with a normal exploitation of the work and does not unreasonably prejudice the legitimate interests of the author.

Article 11bis(2) further states:

It shall be a matter for legislation in the countries of the Union to determine the conditions under which the rights mentioned in the preceding paragraph may be exercised, but these conditions shall apply only in the countries where they have been prescribed. They shall not in any circumstances be prejudicial to the moral rights of the author, nor to his right to obtain equitable remuneration which, in the absence of agreement, shall be fixed by competent authority.

Likewise, Article 13 of the Agreement on Trade-Related Aspects of Intellectual Property Rights ("TRIPS") creates the following 3-prong test required to justify exceptions:

Members shall confine limitations or exceptions to exclusive rights to:

* certain special cases

* which do not conflict with a normal exploitation of the work and

* do not unreasonably prejudice the legitimate interests of the right holder.

On July 27, 2000, the Dispute Settlement Body of the World Trade Organization ("WTO") adopted the Panel Report United States - Section 110(5) of the US Copyright Act1. The Panel carefully considered Article 13 of the TRIPS and concluded that the exception created by Subparagraph (B) of Section 110(5) of the US Copyright Act did not meet the requirements of Article 13 of the TRIPS Agreement and was thus inconsistent with Articles 11bis(1)(iii) and 11(1)(ii) of the Berne Convention (1971) as incorporated into the TRIPS Agreement by Article 9.1 of that Agreement. The Panel therefore recommended that the Dispute Settlement Body request the United States to bring Subparagraph (B) of Section 110(5) into conformity with its obligations under the TRIPS Agreement.

The Panel noted that:

...in cases where there would be a serious loss of profit for the copyright owner, the law should provide him with some compensation (a system of compulsory licensing with equitable compensation).2

It should also be noted that, under the heading "Limitations and Exceptions", Article 10 of the WIPO Copyright Treaty states:

(1) Contracting Parties may, in their national legislation, provide for limitations of or exceptions to the rights granted to authors of literary and artistic works under this Treaty in certain special cases that do not conflict with a normal exploitation of the work and do not unreasonably prejudice the legitimate interests of the author.

(2) Contracting Parties shall, when applying the Berne Convention, confine any limitations of or exceptions to rights provided for therein to certain special cases that do not conflict with a normal exploitation of the work and do not unreasonably prejudice the legitimate interests of the author.

The Agreed Statement concerning Article 10 further states:

It is understood that the provisions of Article 10 permit Contracting Parties to carry forward and appropriately extend into the digital environment limitations and exceptions in their national laws which have been considered acceptable under the Berne Convention. Similarly, these provisions should be understood to permit Contracting Parties to devise new exceptions and limitations that are appropriate in the digital network environment.

It is also understood that Article 10(2) neither reduces nor extends the scope of applicability of the limitations and exceptions permitted by the Berne Convention.

In addition, under the heading "Limitations and Exceptions", Article 16 of the WIPO Performances and Phonograms Treaty states:

(1) Contracting Parties may, in their national legislation, provide for the same kinds of limitations or exceptions with regard to the protection of performers and producers of phonograms as they provide for, in their national legislation, in connection with the protection of copyright in literary and artistic works.

(2) Contracting Parties shall confine any limitations of or exceptions to rights provided for in this Treaty to certain special cases which do not conflict with a normal exploitation of the performance or phonogram and do not unreasonably prejudice the legitimate interests of the performer or of the producer of the phonogram.

The Agreed Statement concerning Article 16 further states:

The agreed statement concerning Article 10 (on Limitations and Exceptions) of the WIPO Copyright Treaty is applicable mutatis mutandis also to Article 16 (on Limitations and Exceptions) of the WIPO Performances and Phonograms Treaty.

[The text of the agreed statement concerning Article 10 of the WCT reads as follows:

"It is understood that the provisions of Article 10 permit Contracting Parties to carry forward and appropriately extend into the digital environment limitations and exceptions in their national laws which have been considered acceptable under the Berne Convention. Similarly, these provisions should be understood to permit Contracting Parties to devise new exceptions and limitations that are appropriate in the digital network environment.

"It is also understood that Article 10(2) neither reduces nor extends the scope of applicability of the limitations and exceptions permitted by the Berne Convention."]

As a signatory to Berne and the TRIPS treaties (and a potential signatory to the WIPO Copyright Treaty and the WIPO Performances and Phonograms Treaty), we submit that Canada must fully respect all 3 of the requirements regarding any existing or proposed copyright limitations and exceptions.

In accordance with Canada's copyright treaty obligations, SOCAN opposes any attempts by any party to promote exceptions at the expense of creators' rights, including the right to full compensation for the use of musical works.

The regime that currently applies to SOCAN can strike an equitable balance between the rights of creators and users because it allows composers, lyricists, songwriters, and their publishers, through their collective SOCAN, to decide, on their own volition, to donate the use of their works to a particular user, for a particular purpose.

In the event SOCAN is not prepared to forego remuneration, and SOCAN and a user are unable to agree on a fee, the Copyright Board of Canada provides a fair mechanism to set the fee and balance the rights of users and creators.

Moreover, the Copyright Act recognizes that exceptions are not appropriate where licenses are available from a collective society. For example, subsection 30.9(6) of the Copyright Act limits the ephemeral rights exception for sound recordings "if a license is available from a collective society to reproduce the sound recording, performer's performance or work". This mechanism may be preferable to any attempts to create further exceptions.


2. INTERNET SERVICE PROVIDER ("ISP") LIABILITY

Numerous submissions propose exceptions to ISP liability. As SOCAN has stated in its Preliminary Submission to the Departments dated September 15, 2001, ISP's are not exempted under the Copyright Act. In any event, the above international treaty provisions are applicable to any existing or proposed exceptions or limitations.

SOCAN endorses the following statement from Page 6 of the submission filed by the Rights Market:

ISPs are the one place that is currently regulated by Canadian law, have a large capital investment, and have a physical connection to every one of their customers. No payment, no access to the Internet for an individual user. The argument could be made that putting a tariff on ISPs in Canada would make them less competitive. ISP's subscriber base is driven by the free content that is available on the Internet. The ISPs have been the general beneficiary of the current situation, which is very unfair to rights holders. Rights holders are not getting paid, ISPs are. This needs to be redressed.



III. CONCLUSION


SOCAN welcomes this opportunity to share our preliminary reply comments on the critical issue of copyright reform.

We look forward to meeting with the Departments to further discuss our views and to continuing to play an active role in the consultation process.
1 WT/DS160/R

2 Ibid. Paragraph 6.229 and Note 205


Preliminary Copyright Reform Reply Comments
October 22, 2001