Bill C-32 (40th Parliament, 3rd Session) Committee on Nov. 25th, 2010

[Charlie Angus, NDP, Timmins—James Bay, ON]

I'm looking at some of the claims that have been made today, particularly about the rights of students and how students are going to be able to access....

I represent a region larger than Great Britain. Many of my communities don't have access to college, unless they take long distance learning. And yet under proposed subsection 30.01(5)...you point out that these rights are second-class rights, because what rights would normally exist in the classroom and when they're in a digital learning environment.... Sure, we can send the materials, but they have to be destroyed after 30 days. It says in the bill that any student learning in a digital environment has to destroy their class notes after 30 days.

So, on the one hand, the creators of these works are not compensated; it's an exemption. But, secondly, they have to destroy their class notes. I find this a really backwards step. Why have we created a two-tier standard for education?

[John Connell]

I think in this case the bill does propose new exceptions that directly and significantly support the sharing of knowledge. It does allow for technology-enhanced distance learning, even incorporating allowable uses of the copyright materials. It allows for the digital delivery of inter-library loan material that's allowable under fair dealing.

Both of these provisions, we think, are vitally important to promoting learning in remote areas of a vast country like Canada. As with all exceptions in the bill, these activities are subject to clear common sense rules.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Yes, but what's common sense about telling a digital student if they're taking a course that they have to burn their notes, whereas students going to school in Ottawa don't? That doesn't seem common sense to me.

[Jean-Pierre Blais]

Earlier you quoted the three-step test. One has to look at it within the context that in a digital world, as the minister has mentioned, within a fraction of a second a document could be in millions of copies around the world. What's the right balance? Is it what is proposed by the government in this bill? Yes, people can have access to the information, to the works, in a distance education setting. However, you have to counterbalance with some of the other preoccupations and make sure it does not become excessive. Indeed, we are concerned about the rights holders and the creators as well.

[Charlie Angus, NDP, Timmins—James Bay, ON]

If we were concerned about them, there would be a compensation regime, and students would be able to take their notes home, because there's nothing to stop any student from making a PDF and flipping their class notes all over the world. So we have a two-tier standard.

I need to move on quickly.

I'd ask the ministry to comment on the Social Sciences and Humanities Research Council study that's being delivered at WIPO on December 1, which has said quite clearly that the enforcement mechanisms in place have not done anything to alleviate piracy.

I'd like to quote to you from Canada's largest music publisher, ole, that has said that:

Bill C-32 contains measures that have failed in other countries' technological protection measures, and the government is mimicking certain US copyright concepts. There is no reason to believe that this legislation in Canada will be anything but a failure.

They go on to say that...on the one hand, they put on the locks, and music publishers aren't believing this is going to work. They say “...Bill C-32 guts the two most digitally-savvy provisions in the current Copyright Act—the Broadcast Mechanical Tariff and the Private Copying provision”, which is bringing in $30 million a year to the music industry right now, with no new compensation plan to replace it.

Our question here, as the opposition, is, how is it we can say we'll have absolute sacrosanct rights for locks that may or may not work, whereas your bill targets the compensation of the artists, who are now supposed to do this for free?

[The Chair, Conservative, Gord Brown]

A quick answer, and then we're going to have to move on.

[Jean-Pierre Blais]

Mr. Angus, I'm not aware of the paper that will be delivered. I will certainly have a look at it and get back to you. In the end it's a policy choice that is difficult for us to answer. We're more than willing to explain what's in the act, but you're asking us a question that's a bit beyond what we are able to answer.

[The Chair, Conservative, Gord Brown]

Thank you.

We'll move to Mr. Braid for seven minutes.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Thank you very much, Mr. Chair.

Thank you to the officials from both departments for being here this morning.

I have questions for both departments. I'll start with the officials from Industry Canada, if I could.

When your boss, the minister, was here for the first hour, he spoke to us in very clear terms about how important the burgeoning digital economy is. He described Bill C-32 as complementing the digital media strategy that's also in the process of being developed. Both of these initiatives go hand in hand.

Could you please describe why Bill C-32 is so important for companies like RIM and OpenText, who lead the pack in terms of digital media, digital economy companies, and why Bill C-32 is important for the next RIM and the next OpenText?

[Colette Downie, Director General, Marketplace Framework Policy Branch, Department of Industry]

Thank you for the question.

A number of provisions in Bill C-32 deal with the things you're mentioning. Some of the key provisions include provisions that promote computer program innovation, allowing third-party software companies to do things like engage in the development of new programs for software interoperability, error correction, reverse engineering, and security testing.

There are provisions that allow for technical reproductions of copyrighted material, things that are done every day now, like buffering or temporary copies of e-mails as they're downloaded. Even photocopiers sometimes make and temporarily retain copies of documents that would be technically infringing.

The provisions also encourage the development of new technologies by updating existing exceptions in the Copyright Act to encourage the development of new technologies like the Network PVR or the introduction of those technologies.

In addition, the bill targets those who promote and profit from copyright infringement, prohibiting the sale of tools or services to enable hacking of digital locks, with penalties for those who profit from that activity.

In addition, it gives strong new legal tools for companies like video game developers, to protect the investments they've made in their product so they can further innovate and provide jobs for Canadians.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

With respect to my second question now, also for Industry Canada, we've heard a lot this morning about the importance of Canada being in line with our international partners and the fact that Bill C-32 does just that, puts us in sync with international standards. Could you elaborate on what those international standards are that Bill C-32 puts us in line with? And why is that so significant?

[John Connell]

I think, principally, the bill would implement the rights and protections set out in the WIPO Internet treaties, which is an international consensus that was agreed to some time ago on the standard of copyright and protection needed to respond to the challenges and opportunities of the Internet. But more broadly, I think our trading partners--everyone--have adjusted their copyright law to the digital age.

It's essentially the plumbing for how that digital economy really works. They have particular creative industries that they will want to ensure have appropriate remuneration and appropriate protections, because we're really in a heavily globalized world, where I think one of the ministers said some things can happen in 20 seconds, and that's about the level of the protection you're working with. We see the total interconnectedness of our economies.

For that reason, there is some interest on the part of our trading partners to come up to the standard that they've really set in terms of copyright law, to ensure that they are protected and to ensure as well that their users benefit from Canadian material.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Thank you.

I will turn now to the Department of Canadian Heritage. Earlier this week, on Tuesday precisely, in Kitchener-Waterloo, the Greater Kitchener-Waterloo Chamber of Commerce held an information session on copyright and the importance of IPR . One of their presenters was Loreena McKennitt--of course, a famous Canadian musician.

I'd like to get your thoughts and your reactions to this. I'm going to quote from the Waterloo Region Record, from a story published in yesterday's edition. It reads:

McKennitt strongly believes Canada needs the new Copyright Modernization Act....

She goes on to say that:

“...the business model of the music industry is no longer predictable and therefore does not have the robust structure it needs for the continued investment of resources, expertise and talent into the future,”....

The article goes on further to say:

The music industry is much more than just the big record companies, she said. The business ecosystem her record label deals with includes recording studios, acoustic engineers, technicians, graphic artists, photographers, CD manufacturers, printers, publishers, travel agents, music equipment companies, caterers, merchandisers, local media advertising outlets...and many others.

While those people struggle, free file-sharing sites make money from stolen music because they are selling advertising to big companies on those sites....

Could you elaborate and comment on that?

[Jean-Pierre Blais]

Certainly, as you might be aware, the arts and culture sector represents about 3.8% of GDP in Canada, which is considerable. It creates jobs, and it is very much at the forefront of the knowledge economy on that, as you mentioned.

It's true, as the minister mentioned, that we have programs that support artists and creators, but the most important need is that we have the proper framework legislation, as my colleague mentioned, that is in a knowledge economy. We are falling way behind vis-à-vis our trading partners on the right framework to support artisans and creators in that environment. I believe what she's trying to get at is that we need the right tools in place.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Great.

Do I have time for a final question?

[The Chair, Conservative, Gord Brown]

Just one quick one, Mr. Braid.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

To either departmental officials, is there urgency with this bill, and what will happen if this session of Parliament does not pass it? What are the consequences?

[Jean-Pierre Blais]

It certainly is a pressing matter in the sense that we hear from Canadians and from our trading partners. But beyond that, I can say that it is, because of the Speech from the Throne, a priority of the government, and we're here to help the committee as best we can for you to put this legislation into the state you will all feel comfortable with.

[The Chair, Conservative, Gord Brown]

Thank you very much.

We'll move to the Liberal Party and Mr. Rodriguez.

[Pablo Rodriguez, Liberal, Honoré-Mercier, QC]

Thank you very much, Mr. Chairman.

Good morning to you all. Thank you for being here.

You heard the questions I put to the ministers a little earlier. My concern relates to the loss of rights for rights holders, which will result in a loss of income. For example, the fact that there will no longer be any levies will mean a loss of income

The measures relating to the educational sector are also very worrisome. In my opinion, based on the current wording, we can assume everything and nothing. Some are saying that students and teachers will be able to use just about everything without having to compensate the creator. Others are saying that it's more restricted.

What kind of study or analysis have you done to suggest that these kinds of provisions should be included? Have you considered potential income losses for rights holders?

[Jean-Pierre Blais]

I don't think any actual studies have been done on this.

As I was saying to Ms. Lavallée earlier, there are also a lot of new rights that have been added, and we have not done any economic assessment of them either.

[Pablo Rodriguez, Liberal, Honoré-Mercier, QC]

Why? Is that because you can't? Is it not possible to do that or do you not think it's important?

Let's take a simple example—broadcast mechanical. Do you know how many millions of dollars that provision is going to cost? We do: $21 million, according to what everyone is saying.

[Jean-Pierre Blais]

I think that question should more appropriately be put to the copyright collectives who deal with this. They would be in a better position to know what impact that provision would have on their revenues.

[Pablo Rodriguez, Liberal, Honoré-Mercier, QC]

Fine, but you're saying that--

[Jean-Pierre Blais]

I cannot give you a specific figure, but according to what the organization is saying, it seems there will be an impact on its revenues.

As I said earlier, a public policy choice was made by the government.