Evidence of meeting #12 for Canadian Heritage in the 39th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was work.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Danielle Bouvet  Director, Copyright Policy Branch, Department of Canadian Heritage
Albert Cloutier  Director, Intellectual Property Policy Directorate, Department of Industry
Marion Ménard  Committee Researcher

4:15 p.m.

Director, Intellectual Property Policy Directorate, Department of Industry

Albert Cloutier

Another limitation on the communication right exists in the context of what we call retransmission. Retransmission is done by cable companies and direct-to-home satellite companies. They pick up television signals and then transmit them by cable to their subscribers. Normally the rights holders that produce the content contained in those signals would have the ability to say no or to negotiate terms of payment. In this particular case, however, just because of the large number of rights holders that would need to be consulted and clear all the rights for, there's what we call a compulsory licence. There's a requirement of payment again, but you don't go to each and every rights holder to obtain authorization. The Copyright Board establishes a tariff and the cable companies and satellite companies pay according to that tariff. That's a limitation as opposed to a true exception.

The private copying regime is another kind of compulsory licensing scheme with a bit of a twist. What it allows people to do is to make copies of music for their personal use on certain kinds of recording media. They don't again need the consent of the rights holder and they don't pay. However, the manufacturers and importers of the media that qualify under the regime for the making of these copies must pay a form of levy to a collective society that represents various classes of rights holders, in this case authors of musical works, the sound recording makers, and the performers. That gives you a sense of the range and type of limitations and exceptions you might find in the act.

If you turn to page 22, that slide discusses a bit about how the rubber hits the road, as it were, in terms of how rights holders can exploit their rights to their advantage for economic purposes. Not only is copyright in a sense a bundle of individual rights, and each of these individual rights can be administered in different ways, but by the same token a rights holder can decide that they will license by territory or over a certain timeframe or into a certain media. It's up to them to decide how they wish to exploit their rights.

A fundamental principle of copyright is that these rights are alienable. In other words, you can assign your right to other people so that they can then exploit the right. This is very important for the manner in which ultimately these rights are administered.

This is true of the economic rights, but the moral rights are treated on a slightly different footing. The moral rights recognize that it is important not to allow the honour or reputation of the author of the work to be prejudiced. They can't be transacted away; they can't be sold or assigned. But if somebody wants to use a work in a particular way that in theory could be prejudicial to the creator, then they can approach the creator and the creator can waive their right and say they consent to the use in this context. That's a bit of the distinction between the economic rights and the moral rights.

How is consent given? That's dealt with on page 23. I can give a simple permission that is generally known as a licence. I just allow you to use my work in a specific instance or for specific uses, but I can also surrender my right to you. I can sell it to you, if you will. In that case there's actually a change, a transfer of the ownership of the right. I'm no longer the person who can exploit it and you have to go to the new owner to get all the necessary consents. To be legally effective, these assignments and these licences must be in writing and signed by the owner of the copyright. That's a small technical matter.

On page 24, we deal with the way in which rights management actually occurs in practice. For the most part, individual creators are not interested in having to go out themselves to try to sell their works. They're more interested, by and large, in the creative act and the creative process. They have a number of options that are open to them in terms of how they can do this. In some cases, they can assign their right to a publisher. In the literary world, that's the typical arrangement. They will assign their right to the publisher, and then the publisher is responsible for marketing the work and exploiting the right.

In the case of music, on the other hand, particularly as it relates to communication, the rights holders have banded together in the form of a collective society, and the collective society is the entity that will license the rights on their behalf. There again, how the licensing is done can vary. In some cases, licences are transactional, so they relate--

4:20 p.m.

Conservative

The Chair Conservative Gary Schellenberger

I'm just going to interrupt for a second.

4:20 p.m.

Liberal

Mauril Bélanger Liberal Ottawa—Vanier, ON

I'm sorry to interrupt, Mr. Chairman, and I thank you for your indulgence. I've just received confirmation that the Minister of Heritage has indeed just announced serious cuts to the department.

So I beg your forgiveness, but I think I have some other things to do right now.

4:20 p.m.

Conservative

The Chair Conservative Gary Schellenberger

Carry on, Mr. Cloutier.

4:20 p.m.

Director, Intellectual Property Policy Directorate, Department of Industry

Albert Cloutier

So licences can relate to a particular work, or for a particular use of a particular work. We call this a transactional licence. It's a one-time use. On the other hand, most collective societies aren't interested in licensing uses by the work. Rather, what they prefer to do is license the whole repertoire of all of the members of the collective, all the rights holders that have joined the collective. This presents significant advantages to users as well, especially in the educational sphere where schools need access to large bodies of works and it would just be too costly to try to negotiate on a piecemeal basis for the utilization of the work.

The last kind of licence is the compulsory licence where the rights holder doesn't have an exclusive right but a right through remuneration only, in which case the copyright board establishes the tariff. Again, it's typically for a broad repertoire of works, a repertoire administered by a collective society.

So there's a wide range of ways in which a rights holder can actually exercise their rights. They're not obliged to join collective societies. They do so because it's beneficial to them. But in the new world, in a digital world, some rights holders are finding that they do want to administer their rights themselves through online licensing arrangements, and that's fine too. The act can accommodate all.

4:25 p.m.

Director, Copyright Policy Branch, Department of Canadian Heritage

Danielle Bouvet

Page 25 deals with international copyright forums. Some of them deal solely with copyright, others deal with copyright and education sciences, and others still are of a very commercial nature.

The World Intellectual Property Organization only deals with copyright. The United Nations Educational, Scientific and Cultural Organization deals with access issues. It has also dealt with the Convention on the Prevention and Promotion of the Diversity of Cultural Expressions. This organization has occasional indirect dealings with copyright matters.

Regarding commercial agreements, the World Trade Organization has the WTO agreement on those aspects of intellectual property rights that have to do with trade, the TRIPS contains a chapter aimed specifically at intellectual property. Chapter 17 of the North American Free Trade Agreement deals with intellectual property and more specifically with copyright. Finally, the free trade agreement between Canada and the United States that was concluded in 1989 sets out obligations for rebroadcasting.

Page 26 deals with international copyright norms. These are based on the fundamental principle whereby copyright is dealt with on a national basis, whereby foreigners can enjoy the protection of Canadian law pursuant to our international commitments. Likewise, Canadians whose works, audio recordings and performances are used in foreign countries can benefit from protection outside Canadian borders.

Page 30 deals with the international agreements of which Canada is a member. It is very important to emphasize the word “member”, because these conventions are binding for Canada, I mean the conventions that Canada has already implemented, such as the Berne Convention, the Rome Convention, the Canada-US Free Trade Agreement, and more recently, the WTO Agreement on TRIPS.

Page 32 mentions various international agreements to which Canada is a signatory. The word “signatory” means that the Canadian government is not bound by these agreements. Canada signed these conventions because it agreed with their underlying principles, but has not yet taken any steps to become a member of these conventions. To do this, the Copyright Act would have to be amended.

Page 34 goes into further detail about one of the international conventions that I mentioned earlier: the Berne Convention for the Protection of Literary and Artistic Works. This convention is administered by the World Intellectual Property Organization and already has 162 members. It is very important in the copyright field, because it not only contains a broad list of exclusive rights granted to authors, but it also includes obligations regarding moral rights as well as a three-step test.

The three-step test is a provision of the Berne Convention that allows a member state to restrict the scope of certain activities or exclusive rights under certain conditions. This is called a three-step test because there are three criteria to be met. The member state must only use exception or restriction in special cases.

Also, it cannot unjustifiably impede the marketing of the work. It also cannot cause prejudice to the rights holder. These three conditions must be fulfilled before the government can oppose the exclusive rights prescribed by the convention.

The Rome Convention is a convention on neighbouring rights. A little earlier, my colleague Albert talked about the rights of artists, sound recorders and broadcasters. The Rome Convention is a convention which frames the protection these three beneficiaries receive. The convention is administered by three international organizations: the World Intellectual Property Organization, or WIPO, UNESCO and the International Labour Organization, or ILO.

It should be noted that the United States is not a member of this convention. It's a convention which grants rights to the three beneficiaries mentioned a little earlier, but more limited rights in certain cases. There are no moral rights, there is no three-step test, but there is a fairly exhaustive list of exceptions which can be taken into account under this convention.

Let's move on to page 32. You can see the Canada-United States Free Trade Agreement, which was signed in 1988. This agreement established minimum standards for cable retransmission. Following this agreement, Canada amended its own legislation to create the famous mandatory licensing system my colleague Albert Cloutier talked about a little earlier. You should also know that this agreement contains a cultural exemption for cultural industries.

Then, there was NAFTA, signed by the United States, Mexico and Canada. Again, this agreement sets minimum levels. In fact, the minimum levels of copyright protection were largely based on the Berne Standards. The agreement also includes a dispute settlement mechanism, which means that if one of the three countries does not respect its obligations, one of the other countries can lodge an appeal before a group of experts who would have to decide whether the country in question did or did not respect its international obligations. As well, the agreement includes a cultural exemption for cultural industries. No complaint has ever been lodged to date.

Further, the World Trade Organization has implemented paragraph 6 of the Doha Declaration on TRIPS and public health. This agreement, yet again, established minimum levels. I'm insisting on using the expression "minimum levels" because this means it would be possible for a member State to go beyond the obligations set out in the convention, but each country must, at the very least, respect these thresholds. Within the framework of this agreement, new standards had been introduced for computer programs. It was the first time that an international convention specified that a computer program was protected under the Copyright Act. Again, a three-step test and a dispute settlement mechanism were also established. You should know that, until today, only one complaint was made to the WTO regarding copyright, and it was a case which pitted the European Union against the United States.

Let's now turn to the WIPO Treaty on copyright, or the WCT. This treaty came into effect in 1996 and is administered by the World Intellectual Property Organization. Today, 60 countries are members of the treaty. Canada is a signatory, but not a member. This treaty supplements the Berne Convention. The WCT represents a special arrangement within the meaning of the Berne Convention, and it completes the Berne Convention to ensure that the Internet and any use made of digital works are framed and subject to international minimum standards.

Lastly, there is the 1996 WIPO Performances and Phonograms Treaty which affects sound recording producers. That treaty was also signed in 1996. There are 58 signatory countries including Canada. At the outset, this treaty was to provide economic rights so as to address new technologies and all the digital issues. It also provides for a three-step test.

Mr. Chairman, that completes our technical presentation. We will be pleased to answer certain questions.

4:35 p.m.

Conservative

The Chair Conservative Gary Schellenberger

Thank you very much.

Mr. Simms is the first questioner.

4:35 p.m.

Liberal

Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL

Thank you, Mr. Chair.

If I may, I'll take a brief minute before I get into the timing of my question—just as a little aside, maybe for the benefit of new members—to say that we dealt with copyright in the last session. Some of you have already dealt with it. As you can see today, it's quite complex.

You will be lobbied from many different angles in many different ways. Maybe you have been already; I don't know. I found in my experience with it that they would come to see me, and I hadn't, I guess, done jurisprudence in the first place. They came in fresh, and I didn't know much about the issue—say with radio transmissions and that sort of thing, or photographs.

Just as a word of advice, get some information from these guys about this before they come to you. You'll find that it is incredibly beneficial and will shorten your meetings. I just want to put that out there—I say it to all—because it gets quite crazy.

Anyway, in questioning I want to talk about WIPO for a minute. We're way behind, aren't we?

4:35 p.m.

Director, Copyright Policy Branch, Department of Canadian Heritage

Danielle Bouvet

That is your opinion.

4:35 p.m.

Liberal

Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL

Well, it seems to me we're a signatory to it, which does not give us any.... We're not members, is that correct?

4:35 p.m.

Director, Copyright Policy Branch, Department of Canadian Heritage

4:35 p.m.

Liberal

Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL

Am I to assume we should have done this a long time ago? I know I'm asking you to express an opinion, but it has been 10 years. Can you shed some light on why it's been going on this long?

4:35 p.m.

Director, Copyright Policy Branch, Department of Canadian Heritage

Danielle Bouvet

I think you are right when you refer to the dates. In 1996, the treaties were signed and here we are in 2006, and Canada has still not amended its legislation so as to enable it to become a signatory to these conventions. It seems to me a lot of time has passed.

However, Canada is following the example of many other countries. These issues are not easy to deal with. New technologies and the utilization of creative works are constantly evolving. While some countries may have decided to act very quickly, others, such as European Community member nations, are still not signatories of these international conventions.

A great deal of work is being done in both these departments. We are examining very important and complex issues. Several different divergent interests are at stake. I think that once the government is ready, it will be pleased to announce its action plan in this regard. However, it cannot be denied that a great number of issues must be analyzed.

4:40 p.m.

Liberal

Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL

It seems to me we've taken a run at comprehensive copyright legislation now several times. In the past few years especially we keep hearing about it. Where are we right now with respect to tabling legislation?

4:40 p.m.

Director, Copyright Policy Branch, Department of Canadian Heritage

Danielle Bouvet

That is a question I cannot answer. I can only confirm that we are working very hard on this issue.

4:40 p.m.

Liberal

Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL

Sorry to interrupt, but where were we at in the last session? What stage were we at with copyright legislation before the election was called?

4:40 p.m.

Director, Copyright Policy Branch, Department of Canadian Heritage

Danielle Bouvet

A bill had been tabled.

As I was telling your chairman a little earlier as well as the rest of you, there will be a meeting about copyright next week. During that meeting, we will be pleased to discuss the background of this file, whether you are addressing my colleague, myself or other officials from either department. In that context, it will be possible to answer many of your questions.

4:40 p.m.

Liberal

Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL

Going back to the general agreements once again and the fact that through the free trade agreement of 1988 and NAFTA in 1992 there are the grand cultural exemptions, which we have and hold so dearly, certainly for us, do you think the copyright legislation coming up and international treaties such as WIPO threaten that situation we're in when it comes to our cultural exemptions?

4:40 p.m.

Director, Copyright Policy Branch, Department of Canadian Heritage

Danielle Bouvet

You are asking me for a legal opinion, but it is not my place to give such an opinion. I therefore cannot answer that question.

4:40 p.m.

Liberal

Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL

Could you briefly explain, then, the copyright legislation as to what pertains to Heritage and what pertains to Industry? I know you explained that before, the difference, but I want you to do it again, just one more time, so that we get it straight.

4:40 p.m.

Director, Copyright Policy Branch, Department of Canadian Heritage

Danielle Bouvet

Actually, responsibility for copyright is shared by the two departments. That is Industry Canada or more specifically its minister who is responsible for enforcing the law and formulating policy and the Department of Canadian Heritage. Under the Department of Canadian Heritage Act, the Department has oversight over the formulation of any policy that impacts cultural industries.

4:40 p.m.

Liberal

Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL

I'm going to get into a little detail about a situation I had. When I was discussing just how complex this is, I remembered a situation whereby now, when it comes to a particular medium by which music is disseminated to the public, if a radio station has 200 CDs and they copy all those onto one hard drive to disseminate to the public on their computer screens, is there not a charge applied when that transfer takes place? Is that true?

4:40 p.m.

Director, Copyright Policy Branch, Department of Canadian Heritage

Danielle Bouvet

At this point, yes.

4:40 p.m.

Liberal

Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL

Why?

4:40 p.m.

Director, Copyright Policy Branch, Department of Canadian Heritage

Danielle Bouvet

Why? Because rights holders have a bundle of rights, including the right to reproduce and the right to communicate to the public by telecommunication.