House of Commons Hansard #56 of the 35th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was tobacco.

Topics

Copyright Act
Government Orders

4:30 p.m.

Bloc

Louis Plamondon Richelieu, QC

Mr. Speaker, I am torn between joy and fear as regards this bill. I am pleased of course as regards neighbouring rights, but extremely concerned about the list of exceptions that is being added.

Let me first put the issue in its proper context. The first phase of this exercise was Bill C-60, which was passed in June 1988 and which is now followed by Bill C-32, to add or remove certain rights to authors.

As we know, copyrights apply to any literary, dramatic, musical or artistic work that is original. This legislation applies to a slew of works, including books, dictionaries, maps, sculptures, paintings and related works such as translations, summaries and adaptations. It applies to both published and unpublished works.

The bill creates two types of rights. Moral rights recognize the author as the owner of the work and, consequently, his or her right to authorize its use in conditions deemed appropriate. There are also economic rights, which can be divided into two major categories: those dealing with reproductions and those dealing with public performances.

As we know, copyrights usually apply for a period of 50 years after the death of an author. The act provides for some exceptions, the most important one being the fair use of a work for private studies or research. I will elaborate on these exceptions later on.

Phase I of the review of the copyright legislation resulted in Bill C-60, passed in June 1988, which extended copyrights to computer programs, extended moral rights of creators over their works, granted the right to exhibit visual arts, abolished compulsory licensing-the so-called K-tel clause, which allowed the reproduction of acoustic works for a payment of 2 cents for the recording-replaced the Copyright Appeal Board by the Copyright Board, and recognized collectives.

A collective is a group of copyright holders, such as SOCAN. However, the first phase, which resulted in Bill C-60 being passed in 1988, did not solve the issue of private copying, or home recording, and did not include the recognition of neighbouring rights.

As well, Bill C-60 did not recognize other creators' rights, such as those claimed by the copyright coalition. Between 1988 and 1994, four series of amendments were made to the act, following the commitments Canada made in the Free Trade Agreement, NAFTA or treaties signed with the World Trade Organization.

The copyright legislation has been in force for about fifty years. It was amended in June 1988 and now this amending legislation, Bill C-32, has five major goals. It sets up neighbouring rights for performers and record producers. We commend this decision. A regime is established in relation to the private copying of sound recordings. It provides for a levy on blank audio cassettes manufacturers. That is also a step in the right direction.

It protects the exclusive markets of Canadian book distributors, what we call the right of distribution. It has some weaknesses but it is still acceptable. It increases the exceptions where no royalties or no neighbouring rights can be claimed. We are shocked to see that the list of exceptions has gone from one page to 12 pages. That is unacceptable and goes against all the progress made in Canada and all the legislation passed throughout the world.

Five, the bill amends the current legislation in order to improve collective administration and civil remedies. In that area, it provides for the usual process.

First of all, I will talk about neighbouring rights. I will remind members that these are rights given to performers and producers of sound recordings. For example, when Renée Claude performed a song, she did not have any rights. Now she will have what are called neighbouring rights, and so will the recording company.

At the present time, when radio stations play the recordings of these performers, the authors and composers receive royalty payments, but not the performers or the producers. So it is a step in the right direction. However, there is a problem on which I will elaborate a little later on.

Members will recall that neighbouring rights are recognized in 50 countries. However, they are not recognized in the United States. Therefore it was important for Canada to adhere to the Rome Convention. It is essentially radio stations that will have to make payments under the neighbouring rights system. However, and this is where the problem is, there is a $1.25 million exception, which means that if a radio station's advertising revenues are less than $1.25 million, it will pay only $100 in royalty payments. Since when can one take somebody else's rights and decide how much that person will receive in compensation? Why not let the free market play its role since we have a tribunal and people who could established the amount that should be paid by users?

Do you use your neighbour's car without his permission and tell him afterwards that you will give him $10? No. You negotiate before using it. It is as simple as that. This amount of $1.25 million seems very high, especially that this system would be in place for a trial period of five years.

I understand that broadcasters wish to be exempted from paying neighbouring rights. In 1993, AM stations lost $59 million, while FM stations made profits of $20 million. They are claiming that the introduction of a neighbouring rights system would shut down radio stations and result in lost jobs.

Like ADISQ, the Bloc Quebecois feels that the raw material is the talent of artists and producers, and that the use of this talent must be recognized. The Copyright Board has the mandate of setting the neighbouring rights tariff, taking into account users' ability to pay. So let us let the Board do its work, instead of setting $1.25 million in advertising revenue as the cutoff, under which only $100 would be payable.

The other major argument of broadcasters against neighbouring rights is that the introduction of such a system would see Canada losing money. We know that clause 15 of the bill provides that Canada will pay neighbouring rights to Canadian holders of neighbouring rights and to those who are signatories to the Rome Convention. SOCAN receives payments from abroad, and it duly makes its own payments. A balance can therefore easily be struck between money coming into and going out of Canada.

Finally, according to the Donner report, neighbouring rights are an important tool for the future, especially with the advent of cable digital broadcasting, which will distribute digital quality music without interruptions from a announcer or any advertising. This distribution represents a source of revenue or important losses for performing artists and producers of sound recordings if the neighbouring rights regime is not introduced.

With respect to neighbouring rights, this is exactly the position adopted by the Bloc Quebecois. The Bloc made a firm commitment to support the introduction of neighbouring rights during the last election campaign. We are therefore consistent with what we promised during the campaign. In addition, since it was elected, the Bloc Quebecois has, on many occasions in the House and before the heritage committee, called for neighbouring rights legislation.

The Bloc Quebecois feels that by finally granting neighbouring rights to our performers and producers of sound recordings, Canada is making up for some very embarrassing lost time. It is regrettable, however, that the government limited itself to sound recordings and has not extended this right to audiovisual recordings. The Bloc Quebecois feels that exempting the first one and a quarter million in revenue from the payment of neighbouring rights is a large concession, too large, to the radio broadcasting industry. We will be making the necessary representations in order to lower this unacceptable cutoff substantially.

It is in fact the responsibility of the Copyright Board, not the legislators, to see that fees charged are compatible with the users' ability to pay. I must point out as well that no one wants to see any radio stations disappear, so the Board will take the stations' ability to pay into consideration.

Finally, the Bloc Quebecois would like to offer assurance that the creation of a new copyright scheme will not interfere with copyrights. To that end, section 90 ought perhaps to be strengthened to ensure that copyrights will be protected.

Neighbouring rights are an indispensable tool for bolstering our recording industry, whose Achilles' heel is underfunding. The recording industry is, moreover, dominated by multinationals. In Canada, Canadian-controlled businesses have marketed 71 per cent of Canadian content recordings. In Quebec, independent labels account for 31 per cent of the market, as compared to 10 per cent in Canada.

What is more, although foreign-owned recording companies are profitable, Canadian-owned ones are just beginning to be. As for the smaller ones, with annual earnings of under $100,000 and essentially Canadian-controlled, these have never been profitable, but they do play an important role in the development of Canadian talent, as the Donner report states on page 4. As far as neighbouring rights are concerned, yes, although the million and a quarter figure strikes us as completely exaggerated.

As for private copying, for which charges would be collected from manufacturers and importers of blank audiotapes, essentially cassette tapes, and then distributed among actors, composers, performers and producers of sound recordings, we know that 25 countries have adopted regimes that provide for collecting charges to compensate for incurred losses.

Last year, nearly 44 million of these blank tapes were sold. It is estimated that 39 million of them were used by consumers to privately copy sound recordings made by composers and artists who must earn a living from the sale of these recordings.

The Canadian sound recording industry loses significant revenue estimated at $324 million a year as a result of home copying. The Bloc also has a very clear position on this issue, which we expressed during the election campaign. We made a commitment to support charges on private copying. We also were in favour of collecting such charges on videotapes. We are therefore disappointed to see that the government went only halfway.

The Bloc is also happy to see that charges will not be set by legislators but by the Copyright Board. We would have liked the same thing for neighbouring rights.

As for distribution rights, we know that this bill will prevent parallel imports. The Bloc Quebecois therefore supports such a measure because it would strengthen the Canadian publishing industry, although it would have more of an impact in English Canada than in Quebec.

On the exceptions, however, we totally disagree with the government and we intend to work hard in this area when the bill is reviewed in committee. The current Copyright Act already provides for some exceptions. It provides for the use of works for the purpose of research and private study without having to pay royalties.

It provides for the use of works for the purpose of criticism, review or news summary preparation, if the source is mentioned. It provides for the public representation or publication of paintings and drawings of a work. The publication of short passages from

literary works in which copyright subsists in a collection, mainly composed of non-copyright matter, intended for the use of educational institutions is also allowed provided certain conditions are met. The list of exceptions goes on; it is about a page long, but these are the four main ones.

Bill C-32 considerably broadens these exceptions as they apply to educational institutions, libraries, archives and museums. To existing exceptions, it adds-and this is no small thing-the permission to use and reproduce works for the purpose of giving an assignment, test or examination; the permission to reproduce works that are not available in a medium of suitable quality.

The bill gives the right to perform in public and to broadcast sound recordings and television or radio programs in educational institutions. It also allows the reproduction of current affairs and other programs, and broadcasting in educational institutions. It allows libraries, museums and archives to reproduce works for management and conservation purposes, and to make photocopies of newspaper and magazine articles, under certain conditions, for their clients. It also allows these institutions to do authorized work.

It exempts libraries, museums, schools and archive services from their responsibility regarding production made by individuals on their photocopying machines. It recognizes the "no fault" principle when copyrights are violated incidentally and unintentionally. It recognizes the right to adapt works for the visually handicapped. Finally, the bill confirms the right of educational institutions and agricultural or industrial fairs to use works if the event is a non profit event.

You will understand that creators, particularly in Quebec, were stunned by the scope of the exceptions introduced as part of the copyright review. This exercise was meant to improve things, but the result is 12 pages of exceptions. This is unacceptable to authors and composers. Generally speaking, creators feel these exceptions violate the spirit of the act, which seeks to protect their rights, not deprive owners of their due. They also feel Parliament should have left users and collectives negotiate the use of their works, as is done with the Quebec education department and the federal government, and that these exceptions will create a jurisdictional nightmare. The terms used lend themselves to such interpretation that the door is wide open for users to refuse to pay their fees, until the courts clarify the provisions of the bill.

We believe that the exceptions are so convoluted as to be unmanageable, that they leave the door open to confusion, that they legalize delinquent behaviour by large institutions, that, under the pretext of balancing everyone's interests, they favour large government institutions to the detriment of much less powerful management companies.

The position of the Bloc Quebecois in this regard is also very clear. The Bloc Quebecois strongly protests this tactic by the government, which is taking advantage of the reopening of the copyright legislation to increase from one to 12 the number of pages devoted to exceptions. The Bloc Quebecois feels that these exceptions are to the detriment of authors and sees no reason why museums, libraries, schools and archives, which pay their employees, their oil and their electricity bills, should cheat authors, composers, performers and producers of their economic rights.

The Bloc Quebecois intends to show how these exceptions invalidate agreements that already exist between these large institutions and management companies. The Bloc also intends to show how these exceptions, in their present form, will lead to confusion and will pave the way for schools, museums, archives and libraries not to pay creators their due.

I would like to give some examples of these unacceptable exceptions. In clause 29.5 the following exception is described: it gives educational institutions the right to perform a work live or in public, to broadcast in public a sound recording or a performer's performance that is embodied in a sound recording, on condition that this is done on the premises of an educational institution, for educational purposes and not for profit, before an audience consisting primarily of students of the educational institution, instructors of the institution, or any person directly responsible for this institution. That is clause 29.5.

Now to the questions we in the Bloc are asking and, of necessity, they will be the questions asked by the creators as well. Why is such an authorization being given to educational institutions? Is an auditorium part of an educational institution's premises? That is not determined. Who will determine whether the event was held for educational purposes or to raise money? Who will determine whether the entrance fees were collected to generate profit or to meet the costs of holding the event?

Who will be stationed at the door to ensure that the audience are indeed students and staff of the educational institution? Will their parents be considered persons directly responsible for setting a curriculum for the educational institution? Do you see all the questions that just one of these exceptions prompts us to ask?

Now, for another exception in clauses 29.6 and 29.7. The purpose of this exception is to allow educational institutions to make a copy of a news or other radio or television program for educational purposes, to be replayed for the students of the institution. Copies may be retained for one year in the case of news broadcasts, and 30 days for other recordings, without copyright, in order to evaluate the educational suitability of such a program.

Then the royalties must be paid and the program may then be retained in keeping with the arrangements entered into with the collective society. The educational institutions must keep a log of their copies.

Imagine the complexity of such a disposition. It prompts us to ask a number of questions. How will the collective societies be able to administer this administrative muddle? Will programs such as serials, for example, be considered by a group of teachers in an effort to decide whether it is really a practical teaching tool? Why did the government not let educational institutions negotiate these points with collective societies as is done in other areas?

Let us consider clause 30, which allows the staff of libraries, museums and archives to make copies of works for clients for personal research purposes, on the condition that the individual satisfies the library, museum or archive that they will be used only for private study or research. Dream on. More questions arise about this clause. What criteria determine for library, museum or archive personnel that the copy requested is for personal ends? Here again, we have a practical example of the crazy limits of the exception.

Clause 30.3 provides that libraries, museums and archives will be cleared of responsibility for the use of their photocopiers, through the affixing of a notice above the photocopier asking users not to contravene the Copyright Act. What about the deals negociated by UNEQ and CANCOPY, which grant licenses to some education institutions in order to allow reproduction by their users for research purposes? Does this mean that, if someone infringes the Copyright Act by phocopying a book, for instance, the school authorities are going to shut their eyes and will not be held responsible?

Since when is an institution not responsible for its reproduction equipment? Photocopiers have become like coat racks with signs posted saying: "We are not responsible for photocopied material". That is what this section is saying. Clause 30.7 also says: "It is not an infringement of copyright to incidentally and not deliberately" use a work. Are there any other laws which state that a person who does something incidentally and not deliberately is not responsible? The guy who gets in his car after drinking and kills someone did not do it deliberately and therefore is not responsible. It is the same thing. That what is said here respecting copyright.

As I said earlier, the position of the Bloc is clear regarding the exceptions: they are unacceptable and far too many. The existing list was sufficient.

As for civil remedies, the last point I want to address, we know that copyright owners claim the present legislation does not protect their works because remedies provided are inappropriate, time-consuming and expensive. The measures proposed to rectify those irritants are simplified legal procedures that ease the process and lessen the potential costs of a lawsuit.

As for statutory damages, when infringement of copyright has been proven, the claimant can choose to have the amount of damages determined according to a schedule provided by the act.

Measures are proposed to prevent through injunctions experienced infringers from circumventing remedies, and to facilitate the granting of such injunctions. The Bloc essentially agrees with the part of the bill dealing with civil remedies.

I will conclude my remarks on the bill as a whole. Part II of Bill C-32 represents two steps forward, some sidesteps and many steps backwards. The steps forward are the recognition of neighbouring rights and levies on blank cassettes. The sidesteps are the exemption granted to broadcasters on the first $1.25 million in advertising revenue, and the steps backwards are unequivocally the exceptions added to the list.

This uneasiness is probably caused by the fact that the legislative aspect of copyright is the responsibility of Industry Canada not of Heritage Canada, which would have better defended creators' rights and would have been more impervious to the lobbying of the broadcasting industry and government agencies.

As a result, Part II leaves a bitter sweet taste, a mixture of emotions going from happiness, since new rights are recognized, to disappointment, as in the same breath we can wonder to what extent they really are recognized, and because copyright is being limited in a very real and concrete manner, without any valid reason.

Therefore, the Bloc Quebecois intends to work very hard on the heritage committee to analyze this bill after second reading, to improve, modernize and amend this bill which is an essential tool of policies promoting the cultural development in Canada and Quebec; this will have to be done with the greater respect for creators who are the very basis, the raw material, of this whole industry.

Copyright Act
Government Orders

4:55 p.m.

Reform

Monte Solberg Medicine Hat, AB

Mr. Speaker, it is a pleasure to speak to Bill C-32.

I must start by declaring my bias on this piece of legislation. I am a broadcaster by trade and it is important that I say that right away. In declaring that, perhaps I should take a couple of moments to explain why I think it is very important from the perspective of someone who has been in the broadcast industry that this legislation not come into place, not necessarily because it hurts broadcasters, although it does, but because it will hurt Canadian culture in general. I will expand on those remarks over the course of the next several minutes.

I should start by acknowledging the work of the hon. member for Kootenay East who now sits on the Canadian heritage committee, my colleague in the Reform Party, our heritage critic who has done a lot of work on this particular issue. He has many concerns and has provided me with some information.

I certainly was aware of the issue and I think hon. members in all parties were aware of it as well. There was a rather intense lobby from all sides with respect to this legislation and there is a good reason for that. The reason is this legislation will profoundly affect the various industries it touches.

I want to talk for a moment about the broadcast industry. The minister said a few minutes ago that the bill will strengthen Canadian culture. I am going to challenge that assertion. It will strengthen some aspects of Canadian culture but at the expense of other players in Canadian culture. I speak primarily of people in the broadcast industry.

I want to make the argument that hundreds of broadcasters in the big and small radio stations around the country are as much a part of Canadian culture as are the recording artists. Absolutely. I will give my personal perspective on this.

I ran a little radio station in Brooks, Alberta. I did that for 10 years. Prior to that I worked at radio stations throughout western Canada, some quite small, some a little larger in medium size markets. It is important to point out the value these little radio stations have in their communities. They are the glue that hold those communities together in so many ways.

The community of Brooks relied on my radio station for the local weather report which is something we take for granted. If we stop to think about it, it makes absolute sense that if we could not support that radio station because of yet another imposition of some kind of a tax, a levy or in this case, neighbouring rights which cause the radio station to go out of business, people who relied on the local weather report would be lost. We are talking about farmers, ranchers and those types of people. People wait to hear whether or not the school bus will be running because of a storm. They simply would not have that local information.

Another example of how radio stations hold communities together is the local news aspect. Many local communities have weekly newspapers but they do not have daily information. That is very important. I talked about the weather. If my memory serves me, the number one reason people listen to the radio is to hear the weather report. The second most important reason is local news. People want to hear what is going on in their community on a day to day basis. If because of government legislation some radio stations are knocked off the map and people cannot get the local information, the sense of community will be lost in a very real way.

I come from Brooks, Alberta which has a population of 10,000. It is quite far from any other major centre. There are many communities in that type of situation around the country. If those communities lost their local radio station it would be a tremendous loss because there would be no other radio station or TV station to jump in to fill the gap. It would be a terrible loss.

I know many hon. members opposite feel the same way. I hope I am not putting anyone on the spot when I read the following letter. That is certainly not my intent. I have a letter which was signed by the hon. member for Essex-Kent. It was sent to the former heritage minister. The letter states: "Neighbouring rights will add dramatically to this local programming loss across our country. Border communities such as Windsor and Sarnia are in a competitive market with the U.S.A. Added cost to the Canadian broadcasters will place them in a less competitive position. It is truly troubling to me to pass legislation that would place the radio broadcast industry in Canada at a disadvantage to their U.S. counterparts".

It is an excellent letter and the hon. member made some very good points in it. That is one huge reason the legislation is bad. Overall this legislation will cost Canadian broadcasters somewhere in the range of $30 million. That comes at a time when over half of the radio stations in the country are losing money, especially AM radio which is under tremendous strain because of fragmentation in the marketplace and new technologies. Suffice it to say that at the present time there are no technologies which can replace what radio is doing around the country.

This is an extremely important issue. Again I say to the minister that she is proposing legislation which will strengthen one aspect of Canadian culture, but it will greatly weaken another.

Another point is that there is really no reason to bring this legislation forward right now. That really bothers me. I do not understand where the minister is coming from. There is a longstanding historical understanding between the record industry and radio with respect to how record companies are compensated when radio stations play their music. If someone's music is played on the radio, obviously it will have an impact on record sales.

The broadcasters recently had Angus Reid conduct a study. It was discovered that about 45 per cent of music purchasers identified radio as the most important influence in their most recent music purchase. It outranked all other factors by a ratio of three to one. Overall, nearly nine in ten or about 88 per cent of Canadian music buyers rated radio to have been a somewhat to a very influential factor in their music purchase over the last year or two.

I get the sense that the minister is setting out to kill the goose that has laid the golden egg. The Canadian music industry and its artists are doing extremely well around the world. Not only are they popular in Canada but they are popular in the United States and Europe as well. There are many obvious examples. Therefore, the question is: If the present system is working extremely well, why are we engaging on a new course that could potentially undermine

the broadcasting industry, which is precisely the industry that has given many of these artists their start?

Many radio stations in order to help them get their licence tell the CRTC when they apply for their licence that they will commit to spending a portion of their profits on promoting new artists who do not yet have a record. They will help them record a song so that the artists can get some air play. In many instances the group, for example the one I belong to, CHUM Limited, a big chain across the country, would say that they would give the new artists free advertising of their records on their air waves.

This is seen as an important way to help fulfil the 30 per cent Canadian content rule, by ensuring that there are lots of good quality Canadian artists out there. A lot of time is spent coming up with ads to promote Canadian recording artists. What we are doing here is undermining the radio industry and therefore jeopardizing precisely the same artists the minister is intent on promoting.

Those arguments are good enough, but there are many other important arguments against this legislation. I want to make another right now with help from the member for Essex-Kent and his letter.

What we are proposing to do seems insane in many ways. We want to set upon a course that will provide neighbouring rights legislation which in effect will ensure that Canadian artists who receive a lot of air play in the United States will not benefit. In fact, they may be ultimately penalized-and I will get to that in a moment-by virtue of the government bringing in this neighbouring rights legislation. At the same time, we are providing a perverse incentive for Canadian broadcasters to play more American music. Let me explain how this works.

Neighbouring rights legislation will extend the current copyright legislation that applies to the composers of music on to the artists and the record producers. In other words, the producers and artists will enjoy the protection of copyright legislation. They do not enjoy it right now. The radio stations will pay for that. In Canada there will be a monetary incentive to play more American music because it is exempt from the copyright legislation. It is a crazy incentive to put in place if someone wants to promote Canadian music. It does not make any sense at all.

On the other hand, we are treating the Americans differently in Canada. They will not be subject to the new copyright legislation. We are treating American artists differently. That will make us subject to a challenge under NAFTA or under the WTO, which would quite possibly mean that the Americans could challenge us. It could mean that some of our artists will be ultimately denied from receiving air play in the United States.

The point with respect to this issue was extremely well made by the hon. member for Essex-Kent. I will read from the letter he sent to the heritage minister:

On Wednesday, November 1st, the U.S. government passed its Digital Performance Rights Act of 1995. This U.S. legislation excludes current radio stations, as well as future digital radio stations, from any form of neighbouring rights royalty payments. There is grave concern in the industry that any introduction of a neighbouring rights royalty in Canada will be detrimental to the radio industry which is already experiencing financial difficulties. Of equal concern is that Canada would have a different system than in the U.S.

The U.S. obviously is the big market for the majority of Canadian artists and also is our biggest trading partner. The letter goes on to state:

For example, if Canada were to have a neighbouring rights regime, which includes Canadians but excludes U.S. entertainers, it would be challenged under the WTO. The effect of a successful U.S. position is that approximately 70 per cent of the royalties paid by Canadian radio stations would be paid to foreigners, with no such return of revenue from the U.S. due to their exclusion. In any event, the U.S. has indicated that it would consider this system under the national treatment rules. This means that the U.S. will simply demand the same treatment for U.S. performers and record companies as given to Canadian performers and record companies.

In other words, because the Americans are excluded, we are going to send our people down there. They will not receive any royalties from the Americans because the Americans do not have this legislation. Radio is exempt under U.S. copyright rules. However, in Canada we will have the situation of a reverse incentive to actually play more American music because broadcasters will see a monetary benefit from it. It makes absolutely no sense. Not only that, we will possibly be subject to a NAFTA challenge or a WTO challenge. We have no idea of what the consequences of that could be. Suffice it to say the country music channel dispute shows us that the Americans are determined to play hardball when it comes to cultural industries.

One of the other concerns I have is with respect to how certain performers are going to benefit from this legislation while other performers are penalized. In relative terms, neighbouring rights legislation most benefits those Canadian artists who tend to receive more air play in Europe where neighbouring rights apply to private radio than in the U.S. where they do not. In practical terms this means that certain genres of music and music recorded in certain languages will benefit at the expense of others.

What is rather obvious, if I can state the obvious here, is that recording artists from Quebec are going to receive far more benefit from this than Canadian artists outside of Quebec. The reason is that most of the people who have signed on to the Berne convention are from Europe. Therefore, Quebec artists who sing in the French

language for instance are going to be the beneficiaries of this. However people who perform in English and have their primary market in the United States are not going to receive the royalties because, as I mentioned several times before, the U.S. excludes neighbouring rights from applying to private radio.

The legislation provides a benefit to francophone artists in particular, but also to other artists who perform in different languages and receive a lot of air play in Europe. Meanwhile, it does not help and most likely will hurt those Canadian artists who perform in the United States. The real situation is that the minister is pitting one group of artists against another. We are headed for trouble if we do that because it is wrong.

Another point I want to make is a little more complicated. Actually Europeans do much better with this deal than do Canadians overall because of our broadcasting system. In Canada literally hundreds of radio stations across the country broadcast to 30 million people. In Europe a fraction of that number of radio stations broadcast to 300 million people.

By virtue of how the neighbouring rights legislation is designed, what is important is how many spins of the record occur over the course of a year and not how many people it reaches. That is how the legislation is designed. In relative terms we will be sending a lot more money to Europe than Europe will be sending to Canada for our artists because of the way the broadcast system is designed.

We have a situation where European performers will actually do better than Canadian performers. It does not make any sense that our government would be promoting that. To me it is ridiculous and counterintuitive. Nonetheless that is precisely what is being proposed.

I will not belabour this point as there are people who would like to discuss other pieces of legislation. I sum up by saying that there is no support for the legislation across the way, as far as I can determine. There is certainly no support for it in my party or, I would argue, across the country.

I would argue that Canadians are very supportive of their local radio stations. People feel that Canadian performers are doing extremely well today. We see them all the time: Shania Twain and Michelle Wright. Many Quebec artists are doing extremely well around the world. To tinker with the current system is to invite disaster, to invite killing the goose that laid the golden egg. All this occurs at a time when private broadcasters are facing serious financial problems.

I cannot understand the motivation for the legislation given all the arguments against it. I encourage hon. members across the way, members of the Bloc Quebecois and certainly members of my own party, to go after the legislation.

I encourage the minister to justify why she is taking this course. I remind her that for every argument she puts forward in favour of the legislation there are three or four against it. I encourage her to think about that and to remember that the broadcast industry, speaking as someone who comes from it, is a very important part of Canadian culture. Steps should be taken not necessarily to promote it but certainly to stop the erosion of it that the Minister of Canadian Heritage is proposing.

Copyright Act
Government Orders

5:15 p.m.

The Deputy Speaker

It is my duty to inform the House that the question to be raised tonight at the time of adjournment is as follows: the hon. member for Davenport-Law of the Sea Convention.

Copyright Act
Government Orders

5:15 p.m.

Liberal

Pat O'Brien London—Middlesex, ON

Mr. Speaker, in his remarks just now the hon. member of the Reform Party made repeated reference to a letter from my colleague, the hon. member for Essex-Kent.

Bill C-32 was first introduced in the House on April 25. Before that date absolutely no one knew what would be in the bill. The letter to which the member opposite refers, the letter from the member for Essex-Kent, was written well before April 25. It is fair to say that Bill C-32 very adequately addresses and satisfies the concerns expressed in that letter.

I regard it not as a duty but as a privilege and a pleasure to speak to Bill C-32. I am genuinely pleased to have the opportunity of saying good things about a manifestly good piece of legislation.

It is with pride that I express my support for a cause so timely and just, so attentive to the principles of fairness and equity, so responsive to the exigencies of our modern age and so ultimately beneficial to Canadian culture.

I use this latter term somewhat guardedly. I am well aware of the dangers inherent in seeming to speak too annoyingly about culture with a capital c . Therefore, unless someone asks me to define the concept, a task that has defeated many a scholarly mind, allow me to resort to terms that most of us can more readily understand.

Here in Canada, the arts and cultural industries give work to more than half a million persons and put $16 billion annually into our national economy. Whatever our opinion might be on culture

with a capital "C", it is evident that, from a purely financial point of view, culture plays an important role in our country. Any measure supporting the livelihood of workers and the prosperity of their sector is ultimately supporting all of our economy and also our identity and our sovereignty.

Bill C-32 is one such measure. In fact, it is a whole series of measures applicable to copyright, an essential element for artistic creators of this country. Copyright is the legal framework whereby creators of works like movies, books, songs, information products and computer programs, receive some financial compensation whenever their work is used by other people.

Prominent among the bill's provisions is its so-called p and p component, which stands for performers and producers rights.

I heard a comment earlier asking whether I was reading my remarks. Yes, I am reading some remarks, but I can tell hon. members of the Reform Party that I have spent considerable months working on the issue with other members of my caucus. I am extremely well informed on the bill. I sit on the Canadian heritage committee as the vice-chair. I welcome the hon. member who made the comment or any others who come before the committee to address it. It is important legislation that we are quite prepared to examine in detail.

These p and p provisions will in effect extend royalty payments to producers and the performers of sound recordings. One might well ask whether royalties do not already ensue whenever recordings are broadcast over the air waves or performed in public. They do indeed, but under the current rights regime royalties in such cases go only to composers and lyricists of the songs in question.

In other words, when a radio station uses the latest recording by Céline Dion or Anne Murray of a song that happens to have been written by someone else, the songwriter gets duly paid for the use of the piece. However the company that made the recording and the song's performer and interpreter, Céline or Anne, do not. That is fundamentally unfair.

With this proposed legislation Canada will join the ranks of some 50 other countries that have already accepted the principle of performers and producers rights. Like them, we will at last recognize in law that those whose recording artistry and expertise bring a work into prominence are as deserving of royalties as composers or lyricists.

Some may look at the illustrious names I have just cited and suggest that I have not chosen the best examples to garner support for performers and producers rights.

Céline Dion and Anne Murray are, after all, fabulously successful and prosperous performers and have been so for some time. As such it may appear that they have little need for p and p royalties. To such a suggestion I would respond in two ways.

First, the Céline Dions and the Anne Murrays of the Canadian music industry are the exceptions, individuals who have reached the pinnacle of their profession. Below them, less visible but no less remarkable, lies a far faster preponderance of Canadian performers, musicians and recording artists, talented and dedicated professionals all but whose acquaintance with popular success may have proved at best fleeting, sporadic and far more modest.

Canadian artists are collectively among the least paid professionals in the country. For those who work in the sound recording industry, the prospect of sometimes getting performers and producers rights or a small fraction of the new royalty on blank audio cassettes could be valuable.

Second, whether rich or poor, famous or unknown, it does not matter what kind of person receives the performers and producers rights, because they are rights, not privileges, and these rights are theirs. They are based on the unquestionable principle of fair payment for work done.

If someone uses the product of my work, I am entitled to expect and to receive a fair payment from him, no matter who I am and what my achievements are, whether I am already rich or not, whether I do not particularly need money at the time or need it. If someone benefits from my works, if he exploits the product of the work I have done, I am entitled to expect a payment.

I realize that user pay approaches are far easier to defend in the abstract than in practice. In developing these legislative proposals we realized full well that we had little to gain by assisting one group and creating hardship elsewhere. That is why we were so careful to take account of the financial situation of broadcasters in establishing the new performers and producers regime.

Therefore members will not be surprised to learn that I am somewhat taken aback and disappointed with the vociferous stance against the bill being taken by certain broadcasters. They would have us believe that Bill C-32 will mean disaster for them, that it will push hundreds of financially beleaguered radio stations over the brink.

How can this be? How is it possible for the broadcasting industry to argue its interests have been irreparably damaged when we have taken such pains to minimize any potential adverse consequences, when they have been so careful to ensure that p and p royalty payments will accord with the ability to pay?

There are some 487 commercial radio stations in Canada. Of these approximately 65 per cent or well over 300 will be required to pay only a nominal flat fee of $100 per year, hardly a sum that is likely to push any station, beleaguered or not, over any brink.

This virtual exemption will apply to smaller stations right across Canada, those that take in annual advertising revenues of less than $1.25 million. This seems by any account a generous limit. Some are even saying it is too generous. It will in effect shelter $400 million, a full 55 per cent of all radio advertising revenue in the country.

As for the remainder of the country's radio stations the larger ones, the richer ones, those that take in advertising revenues in excess of $1.25 million, they will naturally be expected to pay more than the minimum $100 in keeping with their greater income.

Even so, the fees that are set will be phased in gradually over five years. Moreover, these fees will apply only to that portion of advertising revenues in excess of $1.25 million. As an additional measure of prediction the amount of the fee will be established by the copyright board after an open consultative process and after hearing from interested parties on the subject.

The bill will go to the committee on Canadian heritage, of which I am vice-chair. It is a very technical bill. We are certainly open to hearing input from all members. We believe the bill will stand on its merits and will bear careful scrutiny.

The House resumed consideration of the motion that Bill C-20, an act to respecting the commercialization of civil air navigation services, be read the third time and passed, and of the amendment.

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The Deputy Speaker

We will now proceed to the taking of the deferred recorded division on the amendment.

Call in the members.

(The House divided on the amendment, which was negatived on the following division:)

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5:55 p.m.

The Speaker

I declare the amendment defeated. The next question is on the main motion.

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5:55 p.m.

Liberal

Don Boudria Glengarry—Prescott—Russell, ON

Mr. Speaker, perhaps the House would give its unanimous consent to apply the same result in reverse to the main motion for third reading of Bill C-20, and adding as voting yes the hon. Minister of Health and the hon. Minister of Indian Affairs and Northern Development.

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5:55 p.m.

The Speaker

I understand the member for Kenora-Rainy River and the Minister of Finance want to be included in the vote.

Is there unanimous consent?

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5:55 p.m.

Some hon. members

Agreed.

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5:55 p.m.

Bloc

Madeleine Dalphond-Guiral Laval Centre, QC

Mr. Speaker, the members of the official opposition will be voting against the motion.

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5:55 p.m.

Reform

Chuck Strahl Fraser Valley East, BC

Mr. Speaker, the members of the Reform Party present will be voting yes to this motion, unless instructed by their constituents to do otherwise.

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5:55 p.m.

NDP

Len Taylor The Battlefords—Meadow Lake, SK

Mr. Speaker, I thought we were agreeing to do it in reverse. However, since we seem to be putting it on the record, New Democrats will be opposed to this motion.

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5:55 p.m.

Progressive Conservative

Elsie Wayne Saint John, NB

Mr. Speaker, I will be voting against the motion.

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5:55 p.m.

Independent

Gilles Bernier Beauce, QC

Mr. Speaker, I will be voting in favour of the motion for third reading.

(The House divided on the motion, which was agreed to on the following division:)