Copyright Modernization Act

An Act to amend the Copyright Act

This bill was last introduced in the 41st Parliament, 1st Session, which ended in September 2013.

Sponsor

Christian Paradis  Conservative

Status

This bill has received Royal Assent and is now law.

Summary

This is from the published bill.

This enactment amends the Copyright Act to
(a) update the rights and protections of copyright owners to better address the challenges and opportunities of the Internet, so as to be in line with international standards;
(b) clarify Internet service providers’ liability and make the enabling of online copyright infringement itself an infringement of copyright;
(c) permit businesses, educators and libraries to make greater use of copyright material in digital form;
(d) allow educators and students to make greater use of copyright material;
(e) permit certain uses of copyright material by consumers;
(f) give photographers the same rights as other creators;
(g) ensure that it remains technologically neutral; and
(h) mandate its review by Parliament every five years.

Elsewhere

All sorts of information on this bill is available at LEGISinfo, an excellent resource from the Library of Parliament. You can also read the full text of the bill.

Votes

June 18, 2012 Passed That the Bill be now read a third time and do pass.
May 15, 2012 Passed That Bill C-11, An Act to amend the Copyright Act, as amended, be concurred in at report stage with further amendments.
May 15, 2012 Failed That Bill C-11, in Clause 47, be amended by adding after line 15 on page 54 the following: “(3) The Board may, on application, make an order ( a) excluding from the application of section 41.1 a technological protection measure that protects a work, a performer’s performance fixed in a sound recording or a sound recording, or classes of them, or any class of such technological protection measures, having regard to the factors set out in paragraph (2)(a); or ( b) requiring the owner of the copyright in a work, a performer’s performance fixed in a sound recording or a sound recording that is protected by a technological protection measure to provide access to the work, performer’s performance fixed in a sound recording or sound recording to persons who are entitled to the benefit of any limitation on the application of paragraph 41.1(1)(a). (4) Any order made under subsection (3) shall remain in effect for a period of five years unless ( a) the Governor in Council makes regulations varying the term of the order; or ( b) the Board, on application, orders the renewal of the order for an additional five years.”
May 15, 2012 Failed That Bill C-11, in Clause 47, be amended by replacing line 11 on page 52 with the following: “(2) Paragraph 41.1(1)( b) does not”
May 15, 2012 Failed That Bill C-11, in Clause 47, be amended by replacing line 25 on page 51 with the following: “(2) Paragraph 41.1(1)( b) does not”
May 15, 2012 Failed That Bill C-11, in Clause 47, be amended by deleting lines 1 to 7 on page 51.
May 15, 2012 Failed That Bill C-11, in Clause 47, be amended by deleting lines 24 to 33 on page 50.
May 15, 2012 Failed That Bill C-11, in Clause 47, be amended by deleting line 37 on page 49 to line 3 on page 50.
May 15, 2012 Failed That Bill C-11, in Clause 47, be amended by deleting lines 17 to 29 on page 48.
May 15, 2012 Failed That Bill C-11, in Clause 47, be amended by deleting lines 38 to 44 on page 47.
May 15, 2012 Failed That Bill C-11, in Clause 47, be amended by adding after line 26 on page 47 the following: “(5) Paragraph (1)( a) does not apply to a qualified person who circumvents a technological protection measure on behalf of another person who is lawfully entitled to circumvent that technological protection measure. (6) Paragraphs (1)( b) and (c) do not apply to a person who provides a service to a qualified person or who manufactures, imports or provides a technology, device or component, for the purposes of enabling a qualified person to circumvent a technological protection measure in accordance with this Act. (7) A qualified person may only circumvent a technological protection measure under subsection (5) if ( a) the work or other subject-matter to which the technological protection measure is applied is not an infringing copy; and ( b) the qualified person informs the person on whose behalf the technological protection measure is circumvented that the work or other subject-matter is to be used solely for non-infringing purposes. (8) The Governor in Council may, for the purposes of this section, make regulations ( a) defining “qualified person”; ( b) prescribing the information to be recorded about any action taken under subsection (5) or (6) and the manner and form in which the information is to be kept; and ( c) prescribing the manner and form in which the conditions set out in subsection (7) are to be met.”
May 15, 2012 Failed That Bill C-11, in Clause 47, be amended by adding after line 26 on page 47 the following: “41.101 (1) No one shall apply, or cause to be applied, a technological protection measure to a work or other subject-matter that is intended to be offered for use by members of the public by sale, rental or otherwise unless the work or other subject-matter is accompanied by a clearly visible notice indicating ( a) that a technological protection measure has been applied to the work; and ( b) the capabilities, compatibilities and limitations imposed by the technological protection measure, including, where applicable, but without limitation (i) any requirement that particular software must be installed, either automatically or with the user's consent, in order to access or use the work or other subject-matter, (ii) any requirement for authentication or authorization via a network service in order to access or use the work or other subject-matter, (iii) any known incompatibility with ordinary consumer devices that would reasonably be expected to operate with the work or other subject-matter, and (iv) any limits imposed by the technological protection measure on the ability to make use of the rights granted under section 29, 29.1, 29.2, 29.21, 29.22, 29.23 or 29.24; and ( c) contact information for technical support or consumer inquiries in relation to the technological protection measure. (2) The Governor in Council may make regulations prescribing the form and content of the notice referred to in subsection (1).”
May 15, 2012 Failed That Bill C-11, in Clause 47, be amended by adding after line 26 on page 47 the following: “41.101 (1) Paragraph 41.1(1)( a) does not apply to a person who has lawful authority to care for or supervise a minor and who circumvents a technological protection measure for the purpose of protecting the minor if ( a) the copy of the work or other subject-matter with regard to which the technological protection measure is applied is not an infringing copy; and ( b) the person has lawfully obtained the work, the performer’s performance fixed in a sound recording or the sound recording that is protected by the technological protection measure. (2) Paragraphs 41.1(1)( b) and (c) do not apply to a person who provides a service to a person referred to in subsection (1) or who manufactures, imports or provides a technology, device or component, for the purposes of enabling anyone to circumvent a technological protection measure in accordance with subsection (1). (3) A person acting in the circumstances referred to in subsection (1) is not entitled to benefit from the exception under that subsection if the person does an act that constitutes an infringement of copyright or contravenes any Act of Parliament or of the legislature of a province.”
May 15, 2012 Failed That Bill C-11, in Clause 47, be amended by deleting lines 21 to 40 on page 46.
May 15, 2012 Failed That Bill C-11, in Clause 47, be amended by replacing line 25 on page 45 with the following: “measure for the purpose of an act that is an infringement of the copyright in the protected work.”
May 15, 2012 Failed That Bill C-11, in Clause 22, be amended by deleting lines 30 to 34 on page 20.
May 15, 2012 Failed That Bill C-11, in Clause 22, be amended by deleting lines 33 to 37 on page 19.
May 15, 2012 Failed That Bill C-11 be amended by deleting Clause 62.
May 15, 2012 Failed That Bill C-11 be amended by deleting Clause 49.
May 15, 2012 Failed That Bill C-11, in Clause 27, be amended by deleting line 42 on page 23 to line 3 on page 24.
May 15, 2012 Failed That Bill C-11, in Clause 27, be amended by replacing lines 23 to 29 on page 23 with the following: “paragraph (3)( a) to reproduce the lesson for non-infringing purposes.”
May 15, 2012 Failed That Bill C-11, in Clause 21, be amended by adding after line 13 on page 17 the following: “(2) The Governor in Council may make regulations defining “education” for the purposes of subsection (1).”
May 15, 2012 Failed That Bill C-11 be amended by deleting Clause 2.
May 15, 2012 Failed That Bill C-11 be amended by deleting Clause 1.
May 15, 2012 Passed That, in relation to Bill C-11, An Act to amend the Copyright Act, not more than one further sitting day shall be allotted to the consideration at report stage of the Bill and one sitting day shall be allotted to the consideration at third reading stage of the said Bill; and That, 15 minutes before the expiry of the time provided for Government Orders on the day allotted to the consideration at report stage and on the day allotted to the consideration at third reading stage of the said Bill, any proceedings before the House shall be interrupted, if required for the purpose of this Order, and in turn every question necessary for the disposal of the stage of the Bill then under consideration shall be put forthwith and successively without further debate or amendment.
Feb. 13, 2012 Passed That the Bill be now read a second time and referred to a legislative committee.
Feb. 13, 2012 Passed That this question be now put.
Feb. 8, 2012 Passed That, in relation to Bill C-11, An Act to amend the Copyright Act, not more than two further sitting days shall be allotted to the consideration at second reading stage of the Bill; and that, 15 minutes before the expiry of the time provided for Government Orders on the second day allotted to the consideration at second reading stage of the said Bill, any proceedings before the House shall be interrupted, if required for the purpose of this Order, and, in turn, every question necessary for the disposal of the said stage of the Bill shall be put forthwith and successively, without further debate or amendment.
Nov. 28, 2011 Failed That the motion be amended by deleting all the words after the word “That” and substituting the following: “the House decline to give second reading to Bill C-11, An Act to amend the Copyright Act, because it fails to: ( a) uphold the rights of consumers to choose how to enjoy the content that they purchase through overly-restrictive digital lock provisions; (b) include a clear and strict test for “fair dealing” for education purposes; and (c) provide any transitional funding to help artists adapt to the loss of revenue streams that the Bill would cause”.

Nancy Marrelli Special Advisor, Copyright, Canadian Council of Archives

Good morning.

I'm Nancy Marelli. I'm an archivist, and I'm from the Canadian Council of Archives, a national non-profit organization dedicated to nurturing and sustaining the nationwide efforts of over 800 Canadian archives. We are pleased to have this opportunity to present our views today.

The major concern for archivists with recent copyright reform bills has been those provisions dealing with photographs. Other matters of special concern for archivists in Bill C-11 include amendments dealing with copies of unpublished works and technological protection measures. A number of additional issues negatively affect archival researchers, and although many archivists are concerned about these issues, my remarks today focus on matters of direct concern to archival institutions.

Under the current law, archival institutions cannot provide researchers with a copy of a photograph or other types of unpublished works for research and private study purposes, especially for works whose term of protection and ownership cannot be determined. Archivists are delighted that Bill C-11 will solve this longstanding problem.

Once passed into law, this amendment will permit archival institutions to make a single copy of unpublished works in our holdings, for research or private study, under conditions that can be practically met. We heartily welcome and endorse this amendment.

One of the most important matters in Bill C-11 for archival institutions is the proposed amendments dealing with photographs. Many photographs in archival holdings are orphan works, works for which the copyright owners are unknown or cannot be located. The current copyright law relating to photographs is difficult, and even impossible in some cases, for archivists to apply when dealing with orphan works. This already difficult situation will be made even more complicated if the provisions of Bill C-11 are enacted.

Amending the law so the photographer is uniformly the copyright holder makes it even more difficult to determine the copyright owner of some photographs in our collections. Photographs by anyone other than professionals only rarely have an identifiable creator by the time they arrive at an archive many years after they were taken. Without this information, it is impossible to determine the term of protection of the photos, and they fall into limbo. It's not the works of professional photographers that are of concern to us here. Professional photographers usually clearly identify their work, and we can ascertain their date of death and their term of protection. But the law applies equally to all photos, professional or not.

Not all photos are created as commercial works. In fact, millions of the works in our institutions were not created for commercial purposes. They are the records that document the lives of ordinary Canadians, such as the photos your grandmother or your uncle took at the family cottage in the 1950s, photos taken by strangers your parents handed the camera to when they were on their honeymoon in Niagara Falls, or photos taken by a passerby of an entire East Asian immigrant family in front of their small family grocery business. This is our Canadian documentary heritage.

Archival holdings are accessible for research and private study on site in the archives, but in the digital environment, that is not where the vast majority of Canadians search for information about themselves, their families, their institutions, and their society. We seek information on the Internet, in multimedia works, and in specialized electronic and print publications. These essential modes of modern communication are not available for the dissemination of many of our archival holdings, especially photographs, because we do not know who took the photograph.

Archives expend scarce resources to acquire, preserve, and make our holdings accessible, but we often cannot use modern electronic communications means, such as web sites and the Internet, to make them available to the Canadian public because the copyright owners are unknown or cannot be located. They are orphan works. These orphan works fall by the wayside on the information highway of the 21st century. Important chunks of the Canadian experience fall into a black hole where access is severely limited. Researchers have to travel to an archival institution, often far way in another city or province, to use the material on site. Furthermore, without information about who the creator is and his or her date of death, the term of copyright protection is unknown, and the black hole extends into the future with no definite expiry date.

Let me give you a fictional example of the problem.

An archive has extensive materials from a variety of sources on residential schools in Canada and it wishes to share those precious resources with Canadians who are increasingly preoccupied by this difficult subject. The archival holdings include photos taken with a Brownie camera in the 1950s by an unknown person or persons. The amateur snapshots provide graphic documentation of the living conditions in an Ontario residential school. They also include ten minutes of 8-millimetre home movies of three brothers as they prepare to leave their reserve in Quebec in 1964 to attend a residential school. All three children subsequently die in the residential school. The parents are currently unlocatable and no one knows who filmed the event. The archive is at a dead end trying to identify and locate rights holders. It is not possible to create a website featuring these materials, because it is not possible to obtain permission from the copyright holders. The term of protection is unknown, since the date of death of the creator is unknown.

Access to the vast and rich legacy of Canadian documentary heritage provides a revealing window to the Canadian experience, past and present. Canadian archivists preserve and make accessible to all Canadians the diverse records of government, industry, and individuals. Canadian archives strive both to preserve and promote the essence of who Canadians are, and what we have done through the use of the rich documentary heritage that is the memory of the nation.

The changes in Bill C-11 regarding the term and ownership of copyright in photographs further complicate an already difficult situation and they highlight the urgent need to address the orphan works problem, which is not addressed in Bill C-11.

I will now deal with technological protection measures.

Bill C-11 prohibits the circumvention of TPMs for legal purposes, such as preservation activities used by archivists to protect the documentary heritage of Canada. This is completely unacceptable and is a matter of very grave concern to the Canadian archives community in the digital environment where obsolescence is both rapid and disastrous for long-term access.

The CCA recommends that Bill C-11 be amended to provide that circumvention of TPMs is prohibited only when the circumvention is for the purposes of infringing copyright, and that circumvention tools and services should be available for non-infringing uses.

Let me give you a fictional example of how Bill C-11 might affect archives.

An archives holds a copy of a CD on the history of a small Ontario company that built and sold distinctive cast-iron stoves throughout Canada over a period of 150 years. It was the main industry in the small town that grew up around the factory. The CD was created by a small communications group that came together briefly in 1985 as the company was closing its doors. The CD deposited by the family that owned the factory includes photographs, oral history interviews with the owners and several generations of workers and customers, company catalogues, and some film footage of the factory. Only one copy of the CD remains. The communications group disbanded when a fire destroyed its offices and all the original material it had collected for the project. As the lifespan of this important CD approaches obsolescence, the archives wishes to ensure the important documentary heritage it contains is preserved for posterity in a suitable format. But the CD is protected with a digital lock and the archives has not succeeded in locating the original creators. If the archives cannot circumvent the digital lock to preserve the unique historical material the CD contains, an important part of our documentary history will be lost as the CD becomes obsolete and the files become unreadable.

The CCA believes that Bill C-11 is drafted too narrowly in relation to TPMs. Its legislative intent should be extended to include activities related to preservation, management, and maintenance of archival holdings, activities that are currently permitted under the act. Archives should be able to harness the benefits of digital technology to fulfill our preservation mandate. If this requires circumvention of access control TPMs, then the interests of archival preservation for the public good should take precedence.

Copyright legislation has a very significant impact on making the documentary heritage of Canada available to Canadians and to researchers worldwide. The archival community welcomes the opportunity to present our concerns and discuss positive approaches to finding solutions that will ensure we are able to carry out our mandate as the enduring source of Canada's documentary heritage.

Thank you.

Michael McCarty President, ole

Good morning, Mr. Chairman, members of the committee, and ladies and gentlemen.

I'm Michael McCarty, president of ole. We're Canada's largest music publisher. We have over $115 million invested in music copyrights. With that kind of investment on the line, we have a keen interest in Bill C-11. Our catalogue of more than 45,000 songs generates significant royalty revenue around the world, which flows back into Canada, contributing to our GDP, employment, and tax base. Ole's songs and songwriters have received numerous Canadian awards, as well as a Grammy for White Horse, one of the many Taylor Swift compositions we own.

Bill C-11 may be a well-intentioned attempt to modernize Canada's Copyright Act, but the fact is that it will be destructive to music creators and rights holders, and it does not address the biggest piracy problem of all, corporate music piracy. That said, the bill's shortcomings can be overcome with relatively simple but vital changes to the legislation. We urge the committee to return the bill to Parliament incorporating these changes.

Our position is simple. Creators must be compensated for the use of their work throughout the entire digital value chain. This is perhaps an obvious statement, but one that needs to be made in the face of the anti-copyright forces so prevalent today. Here's the reality: it's been 18 years since the Internet was switched on and 13 years since Napster arrived. This powerful combination spawned a decade-long, money-drenched frat party, enjoyed by entrepreneurs, tech start-ups, venture capitalists, telecoms, Internet search engines, and hardware manufacturers. Creators and rights owners were not invited to the party but ended up footing the bill. Their financial hangover knows no end, and Bill C-11 is not the cure.

Copyright is a good thing. Copyright transactions transform art into dollars. Copyright transactions create vibrant markets that enable creators to monetize their work, leverage its value, fuel their careers, and protect their artistic integrity. This is the very currency of the value chain that enables the artists' work to reach the public and for them to be paid appropriately for it. In the digital age, ideas may be more valuable than tangible goods, and a country that fails to protect intellectual property fails to protect its economic future. This means preserving the creators' and rights holders' ability to profit from their creations, not just their right to profit.

To transform digital art into dollars, copyright laws must apply to those companies whose products and services facilitate access to the digital art. To paraphrase the infamous rock and roll pioneer Jerry Lee Lewis, there's a whole lot of monetization going on. But like much of Mr. Lewis's activity, it happens largely outside of the law.

This copyright monetization generates billions of dollars per year to the benefit of all concerned, except for the creators and copyright owners. Bill C-11 will not change this. The bill heavily favours those who are happy to benefit from music but who think it is someone else's responsibility to pay for it—the free riders. It favours the distribution industries over the creators and allows delivery systems to be built at their expense. Vast wealth has been diverted into the pockets of industries that enable and profit unjustly from infringement. ISPs, Internet search engines, advertisers, websites, and device manufacturers are all involved in monetizing music, often without paying any of the proceeds to those who created it. While severely undermining the value of recorded music, the free riders have built very lucrative businesses for themselves. Unfortunately, for the most part the system does not pay creators because the law does not require it to. Under Bill C-11 these companies will continue to enjoy their free ride.

Under the banner of protecting innovation, the bill seeks to protect the innovation of the technology sector at the expense of those who create music. In fact, songwriters and musicians provide innovative cultural work that is just as valuable to society. Favouring one innovator over another is hardly serving the Canadian public.

The bill provides no new viable tools to help creators monetize their art and misguidedly places nearly all of its anti-piracy hopes on failed strategies such as digital locks and notice-and-notice. For music, techniques such as digital locks and suing music fans have failed to reduce piracy or build the marketplace. Notice-and-notice, heralded as targeting ISPs for the piracy activity on their networks, simply requires them to assist in redirecting blame to the consumer. This amounts to even greater protection for the ISPs as they profit from piracy. We don't need band-aids for copyright enforcement; we need a marketplace. As long as the primary enablers of piracy are shielded from liability, creators' works can be taken, sold, or consumed without their being paid.

One of the great ironies of the copyright monetization act is that not only does it not provide any modern tools for our belt, it will actually take two of them away: the broadcast mechanical and the private copying provisions. This is a backward step in our ability to turn digital art into dollars. The broadcast mechanical royalty is one of the most important ways songwriters get paid from radio stations that use their music. It licenses the digital reproduction process used by most modern stations to get music on the air. The broadcast mechanical is a clear example of the copyright system working.

The government uses legislation to create a right, which in turn creates a marketplace. This important revenue stream produces approximately $20 million a year and will disappear under Bill C-11. I hope this is an unintended consequence that will be corrected.

In the late nineties Canada created an elegant, progressive response to the nearly identical problem we face today, the widespread, unstoppable copying of music. Our private copying system was an effective tool to let music fans copy music, while ensuring that creators got paid from the sale of blank CDs. Copying music onto CDs is all but obsolete, replaced by newer digital media and services.

As a result, this private copying revenue stream, which to date has paid our artists over $180 million, is headed towards insignificance. Canada needs to catch up. There are over 40 countries around the world whose private copying system applies to most digital devices and media. Bill C-11 would permanently block our efforts to modernize our private copying system. We need to move forward, not backwards.

There are relatively simple amendments that can be made to make Bill C-11 work, and we have made detailed drafting suggestions in our written submission.

First, rein in the free riders by broadening the enabling provision. This was intended to make the enabling of online copyright infringement itself an infringement of copyright, but it is so narrowly written that it will only apply to the most egregious pirates. It should be broadened to include all of the industries that profit parasitically from piracy.

The result would be a law similar to the U.S. contributory infringement concept. Companies that contribute to copyright infringement can be as liable as those that actually commit the infringing act. It was this law that inspired the creation of the iTunes store. Apple needed a way to immunize the iPod from contributory infringement claims, so they created the iTunes store, which brought the labels onside, resulting in one of the most innovative digital services ever devised, and this delivered a new revenue stream for creators and rights holders.

An improved enabling provision would create a marketplace solution to the free-rider problem and would eliminate the need for extending the private copying levy. Companies that enable infringement would be liable for their actions. For instance, ISPs would have a simple decision to make: take the infringing material off their networks, or negotiate payment with the owners and suppliers of the content. This would jump-start a well-functioning marketplace and would enable ISPs to turn their underground piracy-facilitating business into a legitimate one.

Our second suggestion is to reverse the expropriation of current rights. If Bill C-11 goes ahead without revisions, millions of dollars of annual broadcast mechanical revenue will disappear. Because of a major loophole in the legislation, in order to avoid paying royalties broadcasters would simply have to refresh their hard drives every 30 days by copying one drive onto another. Ole supports the submission of the Canadian Music Publishers' Association and CSI on this subject.

Finally, while our position is that broadening the enabling provision would create a marketplace where an extended private copying levy would be unnecessary, in the absence of such a circumstance ole supports the specific recommendations made by the CPCC and the CMPA to extend private copying.

To conclude, if Bill C-11 is passed in its current form, the result will be to reduce the collective annual income of songwriters and artists by millions of dollars, to provide increased legal protection to the companies that facilitate and profit from piracy, and to support the philosophy of “steal the content to build a distribution business".

A fair marketplace exists when a willing seller and a willing buyer are free to negotiate the sale of goods or services. When the buyer can take the product without paying, there is a failed marketplace. For the creators of music, the failed digital marketplace has left them unable to effectively turn their digital art into dollars.

How long do our artists have to wait for the law to catch up so they can make a proper living? Bill C-11 will be the last opportunity to fix this for at least a decade. We must support all Canadian creators in every area of endeavour. We must not discourage our children's dreams of becoming artists who can also pay the rent. The time to get it right is now.

Thank you.

March 1st, 2012 / 9:10 a.m.


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Counsel, Regulatory Law, Bell, CHUM Radio

Tanya Woods

We appreciate the time each of you has spent addressing the issues that matter most to our industries. Thank you for inviting us to share our views with you regarding Bill C-11, and specifically those pertaining to the technical changes we are seeking for notice-and-notice and the broadcaster's technical copying exception.

We look forward to providing you with any information you need.

Thank you.

Richard Gray Vice-President and General Manager, CTV2 and Radio Ottawa, CHUM Radio

While radio has equally been affected by technological change, as we will see, some things in the radio world have not. Local broadcasters continue to be an integral part of their communities by employing local people, contributing to local regions, creating local content, and investing in and promoting local artists.

To demonstrate Bell Media's role you might consider the following. We employ 723 staff dedicated to our radio operations. We have sponsored thousands of community events. At a more recent one, Ottawa's CFRA raised over $2.4 million to fund care programs at the Elizabeth Bruyère Hospital.

We support and promote local talent through programs like the Bell Media emerging artist initiative, which features a new Canadian artist each month on our radio stations across the country. We invest in Canadian talent development by making substantial contributions to the Canadian content development initiatives. In 2011 Bell Media paid $7.3 million to Canadian content development. We help Canadian artists achieve success in many ways, including airplay and concert sponsorship. In 2011 our radio station in Windsor—93.9 The River-—was a big supporter of Canadian independent musicians, with more than 10,000 airplays.

In addition to all of this, we continue to support the music industry as a whole through the copyright royalties we pay. Last year, of the $64 million radio broadcasters paid for the performance of the songs they broadcast, Bell Media's share was $8.1 million. This is not at issue, and we will continue to pay these royalties. As a content owner ourselves we firmly believe that broadcasters should pay for the music they broadcast.

In addition to paying to broadcast the songs, radio broadcasters are also paying $21 million to the same people for the technical copies made to get those same songs broadcast on air. Not only do two payments for one broadcast amount to double-dipping, but the $21 million reproduction payment basically amounts to a digital tax or a penalty because of innovation. We did not pay it when we spun records, and we did not pay it when live DJs played CDs. But because technology has advanced and the guy or gal that used to drop off CDs for the labels has been replaced by a digital delivery system that the labels created, we now have to pay them to receive their music and put it in a format we can use.

There is something wrong here. They gain huge efficiencies, and even though this may be helpful for us, we nevertheless aren't sharing that gain. We are paying for it, and paying a lot, despite the contributions we continue to make to support their business. Not only is this counter-intuitive, but it also fails to achieve the fundamental goals of Bill C-11, which we understood were also supportive of innovation and business efficiency.

Bill C-11 attempts to address this problem by saying we don't have to pay for these digital copies if we destroy them 30 days after they are made. Although the overall intent is good, this is an unreasonable and unworkable solution that demands that time-intensive processes be implemented at every radio station and that more copying be done. The drafting of proposed subsection 30.9(4) fails to reflect a clear intention, and instead maintains the status quo—a status that is not pro-innovation, and sends a message to the radio industry that it will pay more for innovative and technologically specific business solutions.

We have heard concerns that a meaningful exemption for broadcasters would have a big impact on Canadian artists. We know, as you heard on Tuesday morning from the Canadian Federation of Musicians, that it will not. Most of the money only goes to record labels and publishers, many of whom are not even in Canada.

In sum, we are asking the government to amend the broadcaster exception by creating a clear technical exemption for technical copies. That will acknowledge and encourage innovation, facilitate business efficiency, and more importantly it will put an end to double-dipping.

The Chair NDP Glenn Thibeault

Good morning, everyone.

I'd like to welcome our witnesses and guests to the sixth meeting of the Legislative Committee on Bill C-11.

Before we begin, I have a quick announcement that we have a minor technical glitch. Our proceedings and verification officer—who is fantastic, I might add—is very quick on making sure your microphone is on. Please make sure you do not touch your microphones today, especially numbers 17 and 18 and Mr. Lake, as it will cause a bit of a glitch.

With that, I'd just like to talk to our witnesses briefly. I know you have been briefed by our clerk. Each organization will have ten minutes to speak. After your ten-minute presentation, we'll get to questions and comments from the members, who will have five minutes each.

Introducing our guests, from CHUM Radio we have Richard Gray and Tanya Woods. From ole, we have Michael McCarty. From the Canadian Council of Archives, we have Nancy Marrelli.

Starting off our presentations for ten minutes will be CHUM Radio.

Geoff Regan Liberal Halifax West, NS

Thank you, Mr. Chairman.

Thanks to all of you for coming today. I'm sorry the time is so brief.

We've heard from witnesses today that consumers wind up paying more under this bill. We have heard the music industry will be hurt to the tune of $22 million in losses from this. Now we're hearing that Bill C-11, in your view, will lead to job losses.

Mr. Cormier, could you please let us know how many job losses you are forecasting and how we should amend the bill to avoid that situation?

February 29th, 2012 / 5:35 p.m.


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President and General Manager, Head Office, Criterion Pictures

Suzanne Hitchon

For us, 60% of our business is sold to the educational sector in public performance rights.

I also want to add to what John said. Bill C-11 also allows them to duplicate. So right now a school district would pay us $5,000 to duplicate 1,000 copies of a title. Now they will be able to buy it once for $49, or whatever the fee is, and duplicate it as many times as they want. They could stick it on a digital platform, make it available to all their teachers, and not pay any additional fees for that.

Peter Braid Conservative Kitchener—Waterloo, ON

Okay. Under Bill C-11 they'll still be buying the product; they just won't be paying the licensing fee.

Peter Braid Conservative Kitchener—Waterloo, ON

So under Bill C-11 the schools will still be buying your products.

Peter Braid Conservative Kitchener—Waterloo, ON

Thank you, Mr. Chair.

I'll start with Ms. Hitchon, please. I want to understand why you feel that Bill C-11 threatens your business model, and I'd like to hear some examples.

February 29th, 2012 / 5:15 p.m.


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President, Société des auteurs de radio, télévision et cinéma

Sylvie Lussier

I'm sorry.

So I was saying that Bill C-11, over the long term, will put an end to the private copying regime since compensation will be limited to blank audio media rather than extended to other media and devices now in common use. By also creating new exceptions, such as those allowing reproduction for private purposes, the government has put up a roadblock to any subsequent extension of the private copying regime to the audiovisual field and other sectors.

Making copies for private purposes is a widespread practice that cannot realistically be eliminated or criminalized. The private copying regime essentially makes the practice legal by compensating authors. At a time when content is circulating more than ever on a variety of platforms, the extension of the private copying regime would in fact be a potential solution to the problem of controlling the use of works.

The bill permits the use of legitimately acquired material in user generated content … created for non-commercial purposes. However, this applies only to creations that do not affect the market for the original material, such as creating home videos or mash-ups of video clips. The justifications given for this exception are that more and more, Canadians are using content in ways that contribute to the cultural fabric of our society and it is important for Canadians to be able to fully participate in the digital economy.

It's hard to fully participate in the digital economy if commercial purposes are to be avoided. There is no doubt that certain uses are fairly harmless but the application of this exception could be much broader and difficult to interpret. Using one work to create another also means that the author's moral rights in the integrity of the author's work are ignored. On what basis can the government allow the author's creative output to be appropriated by others? This new exception opens the door to a variety of uses that will be impossible to control.

We have nothing against parody and satire. Our authors are actually the creators of some of it. But as much as we defend their right to produce that type of content, we also refuse to allow works to be appropriated solely to profit from their success and fame.

Many authors have produced parody and satire without being sued. Why does the government find it useful to make this change by including parody and satire in fair dealing? Is there not a risk of unnecessarily extending the scope of that exception, opening the door to a more lax interpretation, and fostering new court cases?

In general, the exceptions are supposedly motivated by a desire for balance between copyright owners and users. The exceptions in Bill C-11 cover the audiovisual sector, but go beyond that to encompass other sectors. Nowhere is it demonstrated that free access to content helps achieve greater balance between the two sides.

And yet, in recent years, thanks to digitization, it is becoming easier and easier to access and copy works but more complicated to provide compensation. The imbalance indeed exists but it is clearly tipped in favour of users over copyright owners.

The current act contains all the parameters needed to ensure a balance between copyright owners and users. For example, copyright licensing agencies help make content easier to access while the Copyright Board can intervene to set pricing if the parties involved are not able to reach a negotiated agreement.

Before adding new copyright exceptions, the government could also have considered that copyright is recognized in the Universal Declaration of Human Rights and that international treaties such as the Berne Convention specify that exceptions should, as a rule, be 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.

Sylvie Lussier President, Société des auteurs de radio, télévision et cinéma

Good afternoon and thank you, Mr. Chair and committee members.

The Société des auteurs de radio, télévision et cinéma is a craft union representing nearly 1,400 authors working in the audiovisual sector.

I'd like to start by making it clear that we are not in favour of the adoption of the bill in its current form. Even though the bill contains a few interesting elements, we believe that the measures intended to strengthen copyright are much less numerous than those limiting or restricting it.

Every update to the Copyright Act brings with it a whole new set of exceptions, which have an impact on creators' incomes, cause problems when interpreting the act and can lead to more litigation in the dealings between copyright owners and users. Bill C-11 unfortunately follows in that vein.

At the present time, the private copying regime applies only to sound recordings. With the introduction of digital formats that make it easier to access and copy contents, we think it would be beneficial for the private copying regime to be extended to books, films, etc. in order to protect the economic value of all types of works. However, over the long term, Bill C-11 will put an end to the private copying regime since compensation will be limited to blank audio media…

Suzanne Hitchon President and General Manager, Head Office, Criterion Pictures

Good afternoon. Thank you, Mr. Chair and committee members, for allowing us to appear today and to speak to you on behalf of both our company and our industry.

My name is Suzanne Hitchon, and I'm here with John Fisher. Together we are representing Criterion Pictures, a division of Visual Education Centre, one of the largest distributors of audiovisual materials in Canada. Our company focuses on the distribution of curriculum-based materials for in-classroom educational purposes. We have been in business since the 1960s.

Our industry provides a vast array of audiovisual content that covers all grade levels and all subject matters in both of Canada's official languages. We are here today on behalf of an entire industry that may very well cease to exist should Bill C-11 pass into law.

We operate independently of government subsidies, and our industry as a whole employs more than 8,000 Canadians.

For more than 50 years, our industry has been providing a highly valued service at fair market prices to educational institutions, while at the same time contributing $30 million to $50 million in annual revenue to the Canadian economy. Like many private industries and small businesses in Canada, we have certainly faced our fair share of challenges. We've had to adapt to change and take financial risks, adjusting to new technologies and budgetary constraints while at the same time meeting the needs of our customers as they have demanded increased services at lower prices. This is the reality of the private sector.

In recent years our company alone has invested millions of dollars of our own money to build a K-to-12 digital delivery platform comprising more than 25,000 audiovisual curriculum-based programs to meet the needs of our customers. Through all this change, we have survived and grown without government support or financial assistance. However, since the inception of this industry sector, nothing has posed a greater threat to its continued existence, to our very livelihood and our lifelong investment, than the passing of this new legislation in its current form. Should Bill C-11 pass in its current state, it will have catastrophic consequences for both our business and that of our industry.

As currently written, Bill C-11 will eliminate requirements for educational institutions to pay for copies of materials they currently license from us, representing a direct loss of millions of dollars in revenue and effectively putting us out of business. The current legislation places a new reverse onus on our industry to monitor more than 15,000 schools throughout Canada for violations—an impossible task. Additionally, it subsequently reduces penalties for damages and eliminates all requirements for record-keeping.

These new conditions in Bill C-11 will lead to an overall loss of jobs and investment and a decline of Canadian content, as most financial incentives for private investment are now removed. As a result, students and teachers will become more dependent on U.S.-produced cinemagraphic works, as Canadian product will be difficult to find.

The government will ultimately need to fill the gap by providing more taxpayer funding to organizations such as the National Film Board of Canada and/or the CBC, if it feels Canadian programs have any value.

The passing of Bill C-11 in its current form is of benefit to neither the non-theatrical industry like us nor the Canadian educational community. There is no winner. Educators are not asking to be exempt from the current copyright provisions, but that is what this bill prescribes. This was clearly outlined during the testimony of the Council of Ministers of Education during the previous Bill C-32 committee hearings, when the chair of the CMEC, the Minister of Education for Nova Scotia, stated and I quote:

We are not asking for anything for free. The education system, the sector, pays for licences and copyright, and will continue to do so. What we are asking for with these amendments is to have things clarified.

Ms. Rosalind Penfound, deputy minister of the CMEC, testified:

Our assessment is that each year across Canada there's likely more than a billion dollars spent by the education sector to pay creators for their books, movies, art, etc.... We would not anticipate that this bill would in any way reduce the amount of money the education sector would be putting into these efforts.

Finally, this is from Ms. Cynthia Andrew, from yesterday's testimony, from the Canadian School Boards Association:

...it has been suggested that the education community does not want to pay for education materials, and this is incorrect. Education institutions currently pay for content and for copying of these materials.... CSBA is not suggesting, nor have we ever proposed, that school boards should not pay for intellectual property.

That's the end of the quote.

Jean-François Cormier President and General Manager, Audio Ciné Films Inc.

Good afternoon, and thank you, Mr. Chair and Bill C-11 committee members, for allowing us to appear today to speak on behalf of our industry regarding what we sincerely hope are unintended consequences of Bill C-11.

My name is Jean-François Cormier, and I am the general manager for Audio Ciné Films, which is based in Montreal. Accompanying me is Monsieur Desmarteau, our communications manager.

Audio Ciné Films is a rights representative and distributor for thousands of films in use in educational institutions across Canada. Our main offices are in Montreal, but we deal with organizations and institutions from every single part of Canada, in both French and English. We are among hundreds of Canadian companies that are involved in the production and distribution of content to the educational sector. We provide content, rights, and services at fair market prices to thousands of schools, colleges, and universities across the country.

A good example of what we do is the movie Monsieur Lazhar, which was Canada's submission for best foreign language film at the Academy Awards last Sunday. Educational organizations can easily present this film, along with thousands of other titles, such as Charlotte's Web and Twelve Angry Men, that are covered with their licence from Audio Ciné Films.

Audio Ciné Films is but one organization in an industry that represents over 500 companies, employs in excess of 8,000 people, and generates approximately $30 million to $50 million in revenues per year.

Specifically speaking for Audio Ciné Films, we typically invest hundreds of thousands of dollars per year to publicize and market the products we represent and maintain a website, which contains information on all the film rights we represent. Our website also allows schools to do film searches based on specific subjects, such as Canadian history, literature, and social issues. It also offers free access to hundreds of film study guides.

As our industry moves toward streaming and digital formats, we foresee having to invest substantial additional resources to keep up with technology and demand from the educational sector. Both ACF and Criterion VEC, who you will also be hearing from today, are privately owned companies and have never received any government assistance or subsidies. We sell our products and services at competitive market rates.

Our market is one of the rare sectors in the film industry that operates without the support of public funds. Yet it remains highly vulnerable to the changes proposed in Bill C-11. Although we certainly understand and support the need for updated copyright regulations, several new clauses in Bill C-11 will have what we believe are unintended consequences that will cause serious financial damage to our business and our industry as a whole.

In particular, a proposed change to section 29.5 of the Copyright Act, on performances, eliminates the requirement for educational institutions to obtain and pay for licences currently needed for the presentation of cinematographic works in an educational context. It further places a new reverse onus and monitoring responsibility on our industry for violations, reduces or eliminates previous penalties, and eliminates requirements for record-keeping.

We have submitted our proposed amendment in our brief. We believe it can easily be added to section 29.5 of the Copyright Act.

Our industry as a whole almost entirely depends on the educational sector for its livelihood. The production, rights representation, and distribution of cinematographic works to schools, colleges, and universities, and the licensing revenue this generates, are critical to our industry. Without some minor technical modifications, Bill C-11 will lead to the overall loss of jobs and investments, and it will lead to a decline of content available to Canadian schools as financial incentives are removed.

We are appealing to committee members today to recognize the harm that will be caused to our industry and the jobs that will be lost if the proposed amendments to section 29.5 are passed as written.

Small businesses such as ours are at the core of Canadian economic success. Nothing demonstrates this better than our industry, which is made up of mostly small unsubsidized privately owned companies, staffed by hard-working and innovative people.

Thank you.

The Chair NDP Glenn Thibeault

If everyone can take their seats, please, we'll start momentarily.

Good afternoon, everyone. Thank you for coming to the second part of the fifth meeting of the Legislative Committee on Bill C-11.

We are very short for time for the second part because of votes that will be happening later on tonight. We will be going until 5:30, when we will have bells, and we will be asking for unanimous consent from all parties to carry on for about 15 minutes afterwards.

What we have asked the witnesses and guests to do is to shorten their opening statements to five minutes, which allows us to get through at least the first round of questioning, in which a lot of the information that you want to share comes out.

We also have hard copies of your opening statements, so thank you. I encourage all of the members around the committee table to read those opening statements in full.

We have, from Audio Ciné Films Inc., Jean-François Cormier and Bertrand-Olivier Desmarteau. From Criterion Pictures we have John Fisher and Suzanne Hitchon. From Société des auteurs de radio, télévision et cinéma we have Yves Légaré and Sylvie Lussier.

We will start off the presentations, for five minutes, with Audio Ciné FIlms Inc.