Bill C-11 Committee on Feb. 27th, 2012

[The Chair, NDP, Glenn Thibeault]

Thank you, Mr. de Beer and Mr. Cash.

Next we have Mr. Calandra.

[Paul Calandra, Conservative, Oak Ridges—Markham, ON]

Thank you, Mr. Chair.

Mr. Gannon or Mr. de Beer, you both mentioned the Swiss model, but I'm not quite clear on what the Swiss model is or what we are talking about. I think you may have mentioned levies, Mr. Gannon. Are you able to expand a little further on what the Swiss model is and how that impacts consumers?

[James Gannon]

I probably have not studied it to the extent that Professor de Beer has for all his articles, but my understanding of it is that the Swiss, for technological protection measures, allow the TPMs to be circumvented for a private copying purpose.

Is that correct?

[Prof. Jeremy de Beer]

For any lawful purpose.

[James Gannon]

For any lawful purpose.

I would preface that first of all by saying that Switzerland...and I have read some articles that suggest that is not a WIPO-compliant model, and even some of the drafters of the WIPO treaties themselves have come out since then and said that Switzerland is not WIPO-compliant.

There's always the argument that we're far behind on this legislation. We are really the last in the developed world to come to this. Why would we look at the country—the other WIPO signatory—that's widely known as having the weakest protection when we're already coming from behind? Shouldn't we be trying to get ahead when it comes to protecting these new business models?

The other argument I made earlier is when you look at the Swiss copyright regime as a whole, Switzerland favours the use of tariffs on things like digital media and blank CDs and all those kinds of things much more than Canada currently does and much more than is the norm in the rest of the world. So I don't think that rights holders in Switzerland would be as concerned with all this uncompensated circumvention, uncompensated copying, when they're already getting revenues through these levies.

[Paul Calandra, Conservative, Oak Ridges—Markham, ON]

Not to interrupt you, but could you just explain a tariff?

[James Gannon]

A tariff, as was heavily debated in C-32, and maybe not so much at this committee yet, is when you impose an additional amount—I know the word “taxes” may be a bit controversial in that aspect—on retailers that would apply to things like blank CDs. Currently in Canada you pay a few cents on each blank CD and it goes toward the collective, and then that collective distributes that amount to artists, somewhat in proportion to what they think people are copying, whose music or movies they think are being copied, mostly just music right now in Canada.

As I said, in Switzerland they have a much stronger regime and they collect a lot more tariffs and a lot more levies, and that's why the rights holders might not be as concerned for all of this uncompensated copying, because they are being compensated through the levy system.

[Paul Calandra, Conservative, Oak Ridges—Markham, ON]

So iPods, iPads, phones, whatever the medium is, presumably. Sorry, you might not....

[James Gannon]

I was speaking about this earlier today to someone and the expression he used was everything but a toaster.

[Paul Calandra, Conservative, Oak Ridges—Markham, ON]

All right. That explains it.

Professor Trosow, at some of the consultations I've had, there has been a lot of discussion about our defining the word “education”, or narrowing the scope of what education is. You seem to be opening it up, or suggesting that education is much broader—senior citizens and so on. I wonder if you could expand on that.

The second thing I want to ask you is if you could identify some of the things that our educational institutions are doing right now to avoid infringing on copyright and if those measures can't be used after C-11, if C-11 is given approval.

[Prof. Samuel Trosow]

I think in the educational institutions that I'm familiar with in Canada there are a lot of measures in place to avoid copyright violations, some of which I think go well beyond what needs to be done.

There was discussion in some libraries of pulling reserve materials off the shelf of their required readings. There's nothing in the law that would require that. I know that some libraries will not even add certain videos to their collection that you can get in a local public library because of worries about public performance clearances.

For many years we had the access copyright licence sit side by side with fair dealing, and I've written about the fact that I think that fair dealing was often trumped by some of the payments in the licence where it wasn't necessary.

In other words, educational institutions have been excessively cautious, and I don't see that stopping by adding the word “education”.

As to the first prong of your question, I think it would be unwise to try to further define the term “education”, because “education” is a good term. It's a good term to use because it touches the information-seeking needs of so many different members of society. I wouldn't want to see that term narrowed. If a court has to construe a term that doesn't have a definition in the act, as the Supreme Court just had to do with the word “research”, they will use common, plain meaning.

[The Chair, NDP, Glenn Thibeault]

Thank you, Mr. Trosow and Mr. Calandra.

Now we go to Monsieur Dionne Labelle for five minutes.

[Pierre Dionne Labelle, NDP, Rivière-du-Nord, QC]

Thank you.

My question is for Mr. Gannon. It has to do with the business model he is proposing, one based on digital locks.

Briefly, I want to draw a parallel with the war on drugs, which had a big emphasis on repression. We were able to bust some big cartels, but in actual fact, the war is all but lost. Drug use is constantly on the rise in America, especially the U.S., where the prisons are full.

Your business model sets out penalties for those who break the digital locks. Would you not say that is an outdated model? We are moving towards cloud computing, now and in the future. Applications and games will be in the cloud and people will need computer access to use them.

To my mind, going down the digital lock road is like fighting a rearguard battle. What do you think?

[James Gannon]

I will answer in English, if I may.

[Pierre Dionne Labelle, NDP, Rivière-du-Nord, QC]

Go ahead.

[James Gannon]

I guess everyone heard the translation.

I think that kind of attitude that we can't stop this copying so why make it illegal—just because this copying is possible, therefore it should be allowed—is very much a defeatist attitude.

If you look at the kind of copying that's been done in the United States, for example, they've managed to build up these business models—they rely on these protections—and we've actually seen the tide turn around. We've seen the tide turn around recently in countries like France and South Korea. They've managed, through progressive legislative enactments that are similar to Bill C-11—but they have some different clauses in there—to turn the tide on uncompensated copying, illegal copying.

Right now we're seeing two things: on the one hand we're seeing a decrease in illegal downloads, but on the second hand we're seeing an increase in legal downloads and an increase in compensated copying and revenues flowing back to creators.

So I think it is a bit defeatist to put your hands up in the air and say there's nothing we can do about it, people are going to copy, as though it's somehow impossible for us to contain that illegal activity.

The examples we've seen around the world nowadays, especially the things coming out of France and South Korea, have shown otherwise.

[Pierre Dionne Labelle, NDP, Rivière-du-Nord, QC]

I wonder if that change in attitude actually has more to do with the use of iTunes, which makes works easier to access without resorting to piracy.

I have a question about fair education. This bill must enable us to ratify the WIPO treaty. Would a school teacher who was photocopying one or two full chapters of a textbook, for instance, be engaging in an activity that violated the spirit of the Berne Convention, making Canada an unacceptable signatory of the treaty? As I see it, not only does the use of such photocopies seem to betray the three fundamental principles of the Berne Convention, but it also seems to harm copyright holders.

Mr. Trosow, what are your thoughts?

[Prof. Samuel Trosow]

In terms of one or two chapters, I guess it depends on how many chapters are in the book, how long those chapters are, and how central those chapters are. If it's a ten- or twelve-chapter book that the instructor would not normally require the students to purchase, especially if the library has a copy or two in its collection, I think it's very reasonable to put those chapters on reserve.

It's very difficult in some courses to find the exact, precise textbook you want to use. As you go up the educational hierarchy, from first grade to twelfth grade to freshman, and all the way up to graduate school, it's harder and harder to find that one text book that fits, so instructors are often in a situation where they have to weave things together.

Fortunately, more and more things are available digitally, and this is where those huge library expenditures come in. The libraries are trying, as much as possible, to figure out what people need so as to minimize the need to even rely on fair dealing. So much more of the readings for a course could be pursuant to a licence, a broad site licence, that everybody in the university has access to.

I think the way out of this situation in the long run is to give our libraries better funding to empower them to do good collection development work, figure out what teachers need to give to their students, and purchase it. Fair dealing is there, though, for those situations around the edge, and sometimes you need to copy a chapter—one good chapter from a book—that you wouldn't otherwise ask the students to purchase.

[The Chair, NDP, Glenn Thibeault]

Thank you, Mr. Trosow and Mr. Dionne Labelle.

Your time is up.

For our last five minutes of this round, we have Mr. Lake.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

Thank you, Mr. Chair.

Thank you to our witnesses. This is a great way to start these committee hearings. As I have been listening to you, I have found what you have to say very educational.

If I may, I want to start on the issue of TPMs. I thought Mr. Gannon and Mr. de Beer had some interesting comments.

In the last committee, I don't believe we saw something that both of you have alluded to, and that is the connection between levies and TPMs.

Mr. de Beer, you did it first when you were talking about this being inconsistent with other parts of the legislation. I think you said something to the effect that if you're charging for a levy, then circumvention ought to be allowed. I just quickly wrote down notes on that.

Then, Mr. Gannon, you were tying the idea of levies and the regime in Switzerland to the approach they took on TPMs.

Can either of you comment on this? Let's use the specific example of either an iPod or an iPad. What kind of levy might be assessed in Switzerland for them? In the brief time since the comments were initially made, I went online. I was trying to research it. It looks like there's quite a vigorous debate over this in Switzerland.

[Prof. Jeremy de Beer]

Yes, if you'll permit me to, I can reply. In general, these are not issues that are as closely related as you might believe.

In fact, in Europe in general, whether it's the European Union or Switzerland, there are many levies on many different devices and digital media. That's not linked to a particular model of anti-circumvention provisions. There is no link. That's not the reason Switzerland has the anti-circumvention provision they do: because there's a levy there. There are many levies throughout the European Union and they have completely different models of anti-circumvention. I have to emphasize that those are not related.

Now, I have published another article wherein I suggest that Canada should not be pursuing the path where we try to levy more media and more devices. This is a market issue and it's a market solution. What we need to talk about is how we can encourage innovation in the digital content market, right? That's fundamentally what it's about.

The question in that context is whether we want to look backwards at the digital business models of the last 25 years or at the digital business models of the next 25 years. There's a really dangerous way of thinking about it, which is that because some countries have enacted strong anti-circumvention provisions, we should do that, and that somehow strong provisions are better than more moderate provisions. That falls into the fallacy that because some protection is good, more is always and necessarily better.

That's really not the way to look at it. We absolutely want to create digital content innovation: innovative business models that facilitate the sale and marketing of digital content. There's a wide spectrum. Some people suggest that technological protection measures have no role to play in that kind of marketplace. I don't think we're seriously debating that now before this committee; we all realize that technological protection measures have a role to play.

The question is, are we going to provide legislation that protects those kinds of business models by protecting technological protection measures? I think everybody even agrees that the answer is yes, that we're going to do that, so the real question is, what kinds of provisions are we going to have? Are we going to have provisions like the United States has or are we going to have provisions like the Swiss have?

It's not an issue of whether there are levies or no levies. That's not it. It's really a question of whether we want business models for the next 25 years, or for the last 25 years, and how we manage risk—

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

I'm just going to interrupt you because I know there's about a minute and a half left and I did want to go to Mr. Gannon to get a response to that.

Mr. Gannon, could you comment on Mr. de Beer's comments about how the TPM anti-circumvention provisions within the act impact the market in moving forward?

[James Gannon]

Sure. Again, I'd like to emphasize to the committee the importance of having that worldwide standard, whereby everyone is on the same level playing field when it comes to the protections. That's why we have a treaty that establishes a minimum standard.

As we said, the only two developed countries we've mentioned here that don't adhere to that standard are New Zealand and Switzerland. We have one country that hasn't even signed on to the treaty. We have another one that is a bit of a black sheep when it comes to the WIPO treaties, and it's seen as possibly controversial as to whether they even comply.

What we haven't mentioned is all the other countries out of the 80 countries that have signed on to the WIPO treaties, those countries that do have compliant and more robust standards. The question I would pose is, why aren't we looking at those 78? Why are we spending our time today on the two that are questionable as to whether they comply? We can adopt that worldwide standard when it comes to protection.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

That's perfect.

[The Chair, NDP, Glenn Thibeault]

You have about 20 seconds.