Bill C-32 (40th Parliament, 3rd Session) Committee on Dec. 6th, 2010

[The Chair, Conservative, Gord Brown]

We'll move to open the second part of today's 6th meeting of the Legislative Committee on Bill C-32.

We have two witnesses for this period. We have Ysolde Gendreau, from l'Association Littéraire et Artistique Internationale (Canada), and Glen Bloom, from the Intellectual Property Institute of Canada.

Madame Gendreau, pour cinq minutes.

[Ysolde Gendreau, President, Association Littéraire et Artistique Internationale (ALAI Canada)]

Thank you very much, Mr. Chairman.

My name is Ysolde Gendreau. I am a professor at the Faculty of Law, University of Montreal. However, I'm here today as president of ALAI Canada, which is the Canadian branch of the International Literary and Artistic Association, a body that was founded in 1878 for the promotion of authors' rights.

I will continue my presentation in French.

Because the ALAI is at the origin of the Berne Convention, I have come here today to talk to you about Bill C-32's compliance with international law and especially with the requirements of international law with respect to exemptions. Before talking about the exemptions, perhaps we should talk about the basic principle. I would first like to submit that a copyright act, whether it concerns copyright or droit d'auteur, represents a partnership between authors and distributors. From the time the first copyright legislation came into existence 300 years ago, Parliament has intervened to inform the distributors of works—at the time, they were printers and book stores—that they had to take authors into account in the compensation they obtained from the sale of their books. The role of Parliament is to provide a framework for this partnership and its evolution as new distributors arise.

In a relatively recent example, in 1954, the Federal Court—at the time, it was called the Exchequer Court of Canada—held that the retransmission of works by cable did not give rise to the payment of copyright royalties. In 1988, 34 years later, Parliament intervened and required cable companies to pay royalties to authors. I would like to point out that that intervention occurred at the time of a trade agreement with the United States.

It is by developing this partnership between authors and disseminators as technology evolves that we foster the technological neutrality of copyright. Exemptions to copyright mark the limits of this partnership because, otherwise, there might be no end. This partnership entails exemptions—as you know, since you have previously heard about this—at the international level. These exemptions are sublimated in what is called the three-step test under the Berne Convention and TRIPS, two instruments to which Canada is bound, and also in the WIPO treaties. There are certain special cases: no conflict with normal exploitation, no unreasonable prejudice to the legitimate interests of the authors/copyright owners.

I would like to submit a few examples of this found in Bill C-32, which, in ALAI's view, undermines the three-step principle, because these exceptions are too broad, because they are based on unrealistic conditions that, once again, make them too broad. Here we're talking about fair dealing for the purpose of education, the new section 29. We're talking about non-commercial user-generated content, private copying under section 29.22. We can add, of course, fixing for later listening or viewing. We can add back-up copies that are not limited to software and applied to all works under section 29.24.

The three-step test is what indicates that copyright and copyright holders have limits. This three-step test is not just a statement of prohibition. It provides for a solution to settle the cases of exceptions that might not meet the three-step test.

Why does it contain in itself this seed of a solution? Because the three-step test was designed in the 1960s, at a time when photocopying was on the rise. Copyright thinkers at the time viewed the increase in photocopying as a rise in mass use and foresaw that technology would continue along that path. What do we see today? We are indeed facing mass use of all kinds of media. They also understood that the answer to these mass uses was collective management. We can come back to this later in response to certain questions that you may wish to ask. What the origin of collective management was, to explain that answer and the context of the exceptions, assists in adjusting collective management, mandatory licences and the determination of value.

International copyright law protects this partnership between authors and distributors. It imposes limits on it that must be respected.

I will be pleased to answer your questions.

Thank you.

[The Chair, Conservative, Gord Brown]

All right. Thank you very much.

We'll move to Mr. Bloom.

[Glen Bloom, Chair, Copyright Legislation Committee (Technical), Intellectual Property Institute of Canada]

Good afternoon. Bonjour. My name is Glen Bloom, and I'm a partner in the law firm of Osler, Hoskin & Harcourt. I appear today on behalf of the Intellectual Property Institute of Canada, IPIC.

It's a pleasure for me to be here today on behalf of IPIC. Thank you for inviting us.

IPIC is the association of intellectual property law professionals. Our membership totals over 1,700 individuals, consisting of practitioners in law firms and agencies of all sizes, corporations, government, and educational institutions. I am the chair of IPIC's copyright legislation technical committee and appear today in that capacity.

To explain the purpose of my presentation, I first need to give you some background about our committee.

The technical committee is composed of experts in copyright. We practise law in private practice, with the exception of Ms. Gendreau, a committee member who is an academic. We represent clients across the spectrum on all sides of the policy debates. The committee takes no position, however, on the policy decisions behind Bill C-32.

Members of our committee have extensive experience in the practice of copyright law and by virtue of that experience have a good understanding of how the Copyright Act works and how amendments could affect both rights holders and users. We therefore bring a different perspective to the specific language utilized in Bill C-32 from the government officials, who address policy choices, and the legislative drafters, who, although experts in drafting legislation, may not have expertise in copyright law and its application in practice.

Our committee has examined the technical issues arising from the amendment to the Copyright Act. By technical issues, I mean the actual wording of Bill C-32. Our goal is to assist the government to ensure that the wording of the bill achieves the government's policy intent and avoids unanticipated consequences. We make suggestions to clarify the proposed amendments to ensure the English and French language texts are aligned to achieve internal consistency in the Copyright Act and to point out possible consequences of proposed amendments, which may not have been intended.

We have prepared a detailed submission addressing technical issues in Bill C-32. A copy of the table of contents showing the breadth of our comments has been handed to you. IPIC will be forwarding the submission to government officials shortly. IPIC would be pleased to provide a copy of the submission to this parliamentary committee, if you wish.

I will provide you with two examples of our many technical comments.

First, subsection 13(2) of the Copyright Act currently provides special rules for the ownership of commissioned engravings, photographs, and portraits. Clause 7 of Bill C-32 repeals subsection 13(2). As a replacement for subsection 13(2), Bill C-32 will enact a new paragraph, proposed paragraph 32.2(1)(f). This new section will provide Canadians certain rights to the non-commercial use of commissioned photographs or portraits. There's no reference to engravings. Our committee questions whether this was an unintended omission and suggests that consideration be given to amending proposed paragraph 32.2(1)(f) to refer to “photographs, engravings, or portraits”.

The second example of our technical comments relates to treaty obligations. Our committee understands that the matter of the extent to which Bill C-32 implements the obligations established by the WIPO Copyright Treaty and the WIPO Performances and Phonograms Treaty is considered to be a policy matter. However, this is not the case with respect to technological protection measures, or TPMs, which we understand are considered to be a technical matter. Consequently, the committee does not comment on treaty implementation, save in the context of TPMs. With respect to TPMs, we are of the view that Bill C-32 is compliant with the obligations in the WIPO treaties. We express no view as to whether a lower threshold of protection for TPMs or fewer legal remedies for the circumvention of TPMs would or would not also be compliant with the treaties.

You may ask why our committee wants to reduce the ambiguities of the legislation and therefore potential areas for litigation. IPIC and our committee strongly believe that in the area of copyright, as with other areas of intellectual property, everyone is better served by certainty. The less doubt there is regarding the scope and application of copyright, the better it is for creativity and for the dissemination and use of copyright works in Canada.

Thank you for listening to me.

I will now be pleased to answer your questions.

[The Chair, Conservative, Gord Brown]

Thank you very much.

We will move to the first round of questioning.

For seven minutes, Mr. McTeague.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

Chair, thank you very much.

Witnesses, thank you for being here.

I'll take up from where we left off with the previous panel, because in terms of ambiguity, the one that obviously comes to mind is the definition, the subject of fair dealing. We have had a number who have come forward with the idea that the additional word “education”, as far as the broader definition of fair dealing, will probably not permit extensive copying of textbooks, etc. In fact, they believe it's fair dealing, not free dealing.

How do you respond to that view and square that with your concern, Mr. Bloom, about ensuring that we get the nomenclature correct?

[Glen Bloom]

It's difficult for me to talk about policy issues. I must stay away from them. But on the issue of clarity, there is one provision in the act, the fair dealing provision, that has to give flexibility to the courts, because it is not possible for legislators to define all circumstances in which fair dealing would apply. The choice that has been selected in our legislation in the past is to leave that issue to the courts, providing the general broad heading of fair dealing for the specific purposes. The courts then have determined whether the use is being made for one of the five fair dealing purposes, and if so, is it fair. The Supreme Court of Canada has identified the six factors to be considered in determining what's fair.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

That's fair, but perhaps more confusing for a committee that has to come up with an answer on definitions that may be broadly defined. I guess the concern we have, as members, is subjecting all of these words to the possibility of legal challenge and almost forcing this to be a precedent-setting matter for down the road. I think we would certainly want more certainty and understanding as to whether these things left alone as they currently stand, as opposed to adding a new addition of education as defined under fair dealing, may lead to unintended consequences.

Madam Gendreau, you suggested earlier, and I think it's here written, that fair dealing for the purpose of education is an exception that goes against the three-step test. You sit on the IPIC. How do you reconcile that with your lawyer colleagues?

[Ysolde Gendreau]

Well, I am a member of the committee, so I let the committee look at aspects of technical matters. I concentrate on other matters where I can have technical input.

I'm not here as a member of the IPIC committee; I'm here as a representative of ALAI, and ALAI is a body that has always been for the promotion of authors' rights. An exception of fair dealing for the purpose of education without any other safeguard has in it the potential to be extremely broad. So if we look at various other examples that we have in the act, we see that there are other provisions that deal with education too. Since the legislator is not supposed to speak for nothing, some meaning has to be given to fair dealing for education, which is different from all these other exceptions for education. And I think this is the start of a possible opening of an exception that is in a very unknown territory, very broad and undefined.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

I simply want to hear from you the need for the purpose of the educational exception in fair dealing, as you understand it.

[Ysolde Gendreau]

As I understand it, I'm not sure there is such a need for a fair dealing purpose with respect to education. There are already other exceptions dealing with education, rather than fair dealing for the purpose of education itself.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

Thank you.

Chair, with your indulgence, we only have one round. Mr. Garneau, I believe, has a question.

[The Chair, Conservative, Gord Brown]

You still have another three minutes plus, sir.

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

Thank you very much.

Mr. Bloom, you talked about six criteria that the Supreme Court has raised. I can read them out here, but you know them better than I do.

Ms. Gendreau, you talked about

the three-step Berne convention. Which is the best tool for us to use, if the courts are going to eventually have to make decisions about whether something related to education is fair or not fair dealing?

[Glen Bloom]

Perhaps I can help you. The three-step test is something to consider as to whether an exception is appropriate and is permissible under the international treaties. The international treaties have permitted a fair dealing exception. The six factors that the Supreme Court of Canada set out are factors to consider the application of the fair dealing exception, and particularly to determine whether something is fair.

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

I appreciate that clarification. Thank you very much.

My second question is for you, Mr. Bloom. If this bill had provisions whereby it was legal to copy and reproduce something that a person had bought and paid for and that had a digital lock, but the person wanted to use it for his or her own personal use and reproduced it and copied it to other devices, would that, in your opinion, still allow us to be in compliance with WIPO?

[Glen Bloom]

It's our understanding, as we've been advised by government officials, that WIPO treaty compliance is a policy issue and therefore I'm not able to speak to that issue. But what I can say is that under the draft of the legislation currently, the prohibition against circumvention cannot itself be circumvented, if I may use that term, by fair dealing. That's a policy issue for the--

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

That I understand as well.

Okay. Thank you very much.

[The Chair, Conservative, Gord Brown]

Great. Thank you very much.

We'll move to Madame Lavallée, pour sept minutes.

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

Thank you very much.

Ms. Gendreau, I very much appreciated your presentation, particularly when you said: "Copyright is a partnership between authors and disseminators," and the word "disseminators" is used here in its broadest sense. Too often I hear the minister say that there should be a balance between artists and consumers instead. I've often heard that as well from the Conservatives. They say the same thing.

However, if we look at history and the Statute of Anne—Anne, Queen of England—we realize that this has always been a search for a balance between authors and disseminators in the broadest sense of that term. It is good to see the facts re-established.

Moreover, unless I'm mistaken, when you refer to the exemptions under Bill C-32 that do not meet the three-step test, you're saying that the bill is inconsistent with international treaties?

[Ysolde Gendreau]

I believe that's the conclusion I would like to come to with regard to those exemptions. It seems to me that exemptions of that kind will not meet the three-step test under the international treaties. Consequently, it is possible that Canada may find itself in an embarrassing situation and eventually be brought before a WTO panel for an additional analysis of this question under international law.

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

Bill C-32 does not comply with those international treaties, contrary to what the minister says, whereas you know that that is one of its main objects. It states that one of the main objects of Bill C-32 is to comply with international treaties. It also states that one of its main advantages is that it is renewable every five years. It's as though someone wanted to sell me a car and told me that that was good because I would be able to change it in four years. It's as attractive as that.

To go back to the international treaties, the minister says that the main reason for this bill is to comply with international treaties. You say that it doesn't comply with those treaties and that Canada could be brought before international bodies to explain itself.

[Ysolde Gendreau]

I would very much fear that Canada would be brought before international authorities on the basis of the exemptions as they are currently drafted.

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

I'm going to come back to the exemptions later, if I have the time.

With regard to the three-step test, the third particularly states: "no unreasonable prejudice to the legitimate interests of the authors" or copyright owners. Does that mean that the three elements that are not contained in Bill C-32 and that force artists to lose enormous annual revenues constitute undue hardship?

The first of the three steps is the non-modernization of private copying. This is an advantage, which artists currently have, that will cause them to lose $13.8 million a year. Then there is the education exemption, which will cause them to lose $40 million a year. There is another one, which we have not discussed today, and that is the exemption granted to broadcasters from paying fees for transitory copying: that's $21 million a year. In all, artists will lose $74 million a year as a result of this bill. Does that mean that this constitutes undue prejudice to authors' legitimate interests?

[Ysolde Gendreau]

I wouldn't put the notion of levy for private copying in the same bag because this is not about an analysis based on a copyright exemption. In my view, compliance with international agreements should not be established on the basis of the three-step test. As for fair dealing for education purposes, yes, that's an exemption that I believe should be analyzed based on the three-step test. Transitory recording in another possibility. As a result of these issues, the exemptions to copyright that should be examined should not prejudice authors' legitimate interests. It must always be borne in mind that the object of a copyright act is to establish compensation for authors and for copyright holders who indirectly benefit from these rights.

I'll give you an example. No one would be surprised to see that the object of a consumer protection act is to favour consumers in their relations with merchants. Of course, when you consider drafting consumer protection legislation, you say to yourself that the conditions must be reasonable for the manufacturers, sellers and merchants. You cannot impose excessive obligations on them. Nevertheless, the basic policy is still the protection of consumers' interests.

Somewhat the same thing is true of the Copyright Act. The basic policy, the one that the international treaties represent and with which we have been living for 300 years, is that these laws protect the interests of persons whose creations are of that kind.