CCA Bulletin 8/10

March 18, 2010

Copyright: Opposition Parties First on the Ice!

Just the facts

In both the Throne Speeches of November 20, 2008 and of March 3, 2010, the Conservative government promised to proceed with legislation to modernize Canada’s copyright laws and ensure stronger protection for intellectual property. To avoid the sharp criticisms which had accompanied the tabling of Bill C-61in June 2008, the Ministers of Heritage and Industry carried out extensive consultations across the country during the summer of 2009. If, as had been promised, a new bill had been introduced before the Christmas recess, it would have died on the Order Papers like its two predecessors, because of the sudden prorogation of Parliament. It is now expected a new bill will be presented in the coming weeks, and surely before the June recess.

This week, two Opposition parties decided to get the ball rolling. On March 16, NDP member Charlie Angus introduced two proposals to amend the Copyright Act.  Angus tabled Bill C-499, which would adapt the successful Private Copying Levy regime to the current generation of copying devices, such as MP3 players, hard discs and cellular phones. At the same time, he introduced a "motion on fair dealing that would protect the reasonable use of copyrighted materials for innovation, research, and study."

On the same day, BQ member Carole Lavallée was successful in having the Standing Committee on Heritage adopt a similar motion inviting the government to immediately amend Part VIII of the current Copyright Act to ensure that the Private Copying Levy regime apply immediately to digital recording devices. In an interesting political twist, the Bloc’s motion was adopted thanks to the deciding vote of the Committee’s Chair, Conservative MP Gary Shellenberger, who last December had written to the Minister of Industry asking for the same thing (all other Conservative members on the Committee voted against the motion).

Within minutes of Mr. Angus tabling his private member’s bill, the Heritage Minister James Moore was tweeting the following message: “I am against the NDP's new proposed tax on ipods/blackberries/iphones/laptops/MP3 players. Consumers deserve lower, not higher taxes.” It is interesting to note that the Minister calls a tax what is essentially the perception of a right, a levy for artists to earn money from their content, while allowing users to transfer legally purchased media between players.

The Industry Minister Tony Clement immediately reinforced his colleague’s statement: "I think it's totally nonsensical. We cannot have a strategy of greater access to Internet and to have a better digital economy in this country and, at the same time, have this NDP plan to tax iPods and to tax BlackBerries and other portable devices," he said. "That's 180 degrees in the wrong direction. That's not the government of Canada's position ... so we're going to be opposing this."

These statements may be strong indicators for the government’s intentions regarding upcoming copyright legislation. These statements completely ignore the cultural aspects of a digital strategy and focus on the infrastructure of the digital economy. Here, we see an absence of any acknowledgement to the artistry and creativity within digital content. So far, we have seen no preoccupation in encouraging Canadian cultural content and its creators in any of the government’s talk about a National Digital Strategy.

It seems highly unlikely that either the NDP or the Bloc’s initiatives will get anywhere (MP Lavallée’s own communiqué talks of a “moral victory for artists”, and one knows how much that is worth!). But they at least have kicked off an interesting debate on the notion of the Private Copying Levy which, since 1999, has generated over $180 million for the music industry. According to sources, the government’s Copyright Bill would let the existing regime die of natural causes, as fewer and fewer people use tapes and CDs and turn to electronic devices for their private copying. The money raised through the levy on blank tapes and cd’s has already gone down from $ 39.4 million in 2004 to $ 29.3 million in 2008.

Tell me more about the Private Copying Levy

A private copying levy is a government mandated scheme in which a special amount (additional to any general sales tax) is charged on purchases of recordable media. Such levies are in place in various countries and the income is typically allocated to the developers of "content".

Private copying is the subject of Part VIII of Canada's Copyright Act, the federal statute that sets down the general legal framework for copyright in Canada. Copyright is the legal mechanism by which those who create original works, like music, are able to be paid for that work. As copyright holders, creators have a right to control certain uses of their work, and place conditions - like payment - on use by others. These payments take the form of royalties. To illustrate, performance of a song, a record sale or printing a musical score are all events that would trigger a copyright royalty.

Unlike a publishing or record deal, private copying cannot by its very nature be managed and accounted for by contract: private copies are made spontaneously by people in the privacy of their homes. That's why private copying receives special treatment in the legislation. Permission does not have to be sought; private copying is simply permitted. But in exchange, the Act sets up a system to collect and distribute royalties to those with rights in the music that is copied. True to general copyright principles, legislators have ensured that creators and others with copyright in recorded music are able to be paid for use of their work. Canada's current private copying levies are $0.24 per unit for Audio Cassette tape (40min or longer) and $0.29 per unit for CD-R, CD-RW, CD-R Audio, CD-RW Audio and MiniDisc.

The Copyright Act identifies the general types of copyright holder on whose behalf private copying royalties are collected and are eligible for payment. Songwriters, music publishers, recording artists and record companies – those with rights in the music copied – are all eligible. While songwriters and music publishers are eligible regardless of nationality, only Canadian recording artists and record companies may receive payments under current law.

In 2005, the Federal Court of Appeal overruled a 2003 Copyright Board decision which had applied the blank media levy to MP3 players such as Apple’s iPod, on the basis that such devices did not qualify as "audio recording medium" as per the Copyright Act definition. Before this, the proposed rates were $2 for players with less than 1 GB of capacity, $15 for players up to 15 GB, and $25 for players 15 GB and over.

In 2007, the Canadian Private Copying Collective (CPCC)  asked the Copyright Board of Canada to reintroduce the levy of $5 to $75, this time onto the memory component of the digital audio recorders (such as MP3 players) in Canada. In addition, CPCC also proposed levies of $2 to $10 for memory cards, 8 cent increases to CD, CD-R Audio, CD-RW Audio and MiniDiscs. In January 2008, the Federal Court of Appeal overturned the Copyright Board's July 2007 decision, stating that "the Copyright Board has no legal authority to certify a tariff on digital audio recorders or on the memory permanently embedded in digital audio recorders." Only an amendment of the type proposed in Bill C-499 could make it possible for the Copyright Board to extend the current regime to new technologies and therefore ensure that artists are duly compensated for their work.

What can I do?

Like a number of arts organizations and unions, the CCA supports the Private Copying Levy regime and its extension to the new electronic devices. Please make your support known to Ministers Moore and Clement as well as to your local MP.