Canadian Heritage Committee on May 31st, 2018

[Margaret McGuffin]

My first would be a warning on exceptions. Exceptions sound very harmless when they are pitched as small solutions, but they have played havoc in the last five years when combined with an ineffectual copyright board. Money is being held back from creators while we wait for decisions that then come out and are no longer technically relevant. Just be careful about exceptions.

[The Chair, Liberal, Julie Dabrusin]

Thank you.

We are now going to Mr. Van Loan for seven minutes.

[Peter Van Loan, Conservative, York—Simcoe, ON]

Is it correct that all of you are associations and none of you are collectives that actually collect royalties?

[A voice]

Correct.

[Peter Van Loan, Conservative, York—Simcoe, ON]

I wanted to be clear on that.

To the Canadian Music Publishers Association, we have heard here that there are basically two baskets of royalties. There's a performer royalty and an author or composer royalty. Where do you guys fit into that as the music publishers? Who are publishers?

[Margaret McGuffin]

Music publishers have a contractual relationship with composers and songwriters. They assume a share of the copyright only after entering into a contract with a composer, a lyricist, or a songwriter.

[Peter Van Loan, Conservative, York—Simcoe, ON]

Your members, if you will, get their revenue out of the author basket, not the performer basket.

[Margaret McGuffin]

Yes. That is correct.

[Peter Van Loan, Conservative, York—Simcoe, ON]

That's only pursuant to a contractual agreement.

[Margaret McGuffin]

Yes.

[Peter Van Loan, Conservative, York—Simcoe, ON]

For example, would SOCAN send the money to you or to the composer?

[Margaret McGuffin]

They send to both, based on the contractual arrangement, but they have a minimum of a fifty-fifty split.

[Peter Van Loan, Conservative, York—Simcoe, ON]

Explain what you mean by the minimum fifty-fifty split.

[Margaret McGuffin]

At a maximum, the publisher can only get 50% of what is collected. The songwriter will get 50%. In many cases, especially in English Canada, the contracts are such that the songwriter is getting that 50% plus some of the publishing money.

[Peter Van Loan, Conservative, York—Simcoe, ON]

Does that minimum fifty-fifty split come from their practices or your practices? Is it legislated? Did the Copyright Board come up with it? Does it have status? Where does it come from?

[Margaret McGuffin]

It is based on their distribution rules, which are based on international standards.

[Peter Van Loan, Conservative, York—Simcoe, ON]

Does anybody dispute them? Are there any places where people have been able to contract out of them or have done so?

[Margaret McGuffin]

I'm not aware of any.

[Peter Van Loan, Conservative, York—Simcoe, ON]

Okay.

You've asked for a couple of things. If you were to look at one issue in front of us that we're potentially dealing with in which you want to see change, what would be that single most important issue?

[Margaret McGuffin]

The single most important issue before the election is Copyright Board reform.

[Peter Van Loan, Conservative, York—Simcoe, ON]

When you say “Copyright Board reform”, what does that mean? Many people have told me there are problems with the Copyright Board, and it's always harder to find out specifically what you would change in terms of reform to solve those problems.

[Margaret McGuffin]

There was a consultation last September, which the innovation department ran. There were 60 submissions, which had suggestions that were quite harmonized across the user side and the payee side. I think you can turn to those submissions. You will find that some of them are around case management. In the recent IP strategy, there has been some dedication of funds to case management. There have been suggestions for some minor reforms to the act too. I don't have the details on that, but I can provide them if you would like.

[Peter Van Loan, Conservative, York—Simcoe, ON]

Thank you. I think that would be helpful, because that's still ongoing. Also, you're absolutely right. It is one of the things I hear about most of all, although often it seems like the solutions to the problem have as much to do with the people as they have to do with any changes of rules or even changes of funding.

In terms of things one might change in the actual act, since what we're dealing with is technically a review of the Copyright Act, what would be the single biggest change you would want to see in terms of the statute?

[Margaret McGuffin]

We would like to see term extension.

[Peter Van Loan, Conservative, York—Simcoe, ON]

There's a clear pattern out there on term extension. There seems to be some reluctance to move it forward because it's linked to a lot of international trade negotiations, and it seems to be something that our trade partners are asking for. There's a similar concern that by simply legislating it we're engaging in a kind of unilateral disarmament, and that will hurt us in trade negotiations in other sectors of the economy. What's your answer to that?