Thank you, Madam Chair, and thank you for the invitation to present to the committee today.
My name is Stuart Johnston. I am the President of CIMA, the Canadian Independent Music Association, and with me is Chris Moncada of eOne Music, Last Gang Music, a CIMA board member and vice-chair of our government affairs committee.
CIMA is the national not-for-profit trade association representing the English-language, Canadian-owned and -controlled companies of the domestic music industry, including independent record labels, managers, publishers, distributors, artist entrepreneurs, recording studios, and the like, all small businesses.
Today you will hear us repeat recommendations that previous witnesses have given this committee. This is because there is a broad consensus within our industry on what needs to be done to improve the livelihood of our music creators. It's also important to know that creators must be defined as everyone in the music ecosystem of creating, recording, performing, and commercializing music. Creators are the artists, songwriters, and composers, and the companies that support them, such as labels, managers, and publishers. We urge the committee to review these consultations through this lens to ensure that all who create and commercialize intellectual property are properly supported and protected by Canadian law.
You've been told about the value gap, the difference between the value of our music and what is paid to our creators for the use of that music. Our four recommendations for amendments to the Copyright Act will go a long way toward closing that gap here in Canada.
First, remove the temporary $1.25-million radio royalty exemption. Since 1997 Canada's radio broadcasters have been exempted from paying statutory public performance royalties on the first $1.25 million of revenues. The federal government had amended the Copyright Act to provide this exemption to commercial radio stations in an era of low profits and uncertainty for the radio industry. Since then their profits have risen by 8,300%. This means creators have been subsidizing Canada's commercial radio industry to the tune of about $8 million a year. This exemption, unique in the world, was supposed to be temporary. I must point out that songwriters appropriately are not covered by this exemption; only performers and record labels are penalized under this system.
Second, amend the definition of sound recording in the Copyright Act to allow recorded music in TV and film to be eligible for public performance remuneration. The act does not consider recorded music as a sound recording when it's included in a soundtrack of TV or film. Because of this omission sound recordings are not entitled to royalties. For example when the movie Titanic is broadcast to the public the composer of the song My Heart Will Go On receives public royalties, but not the performer, Céline Dion. This omission is costing performers and makers approximately $45 million or more a year in loss of revenues.
Third, extend copyright term to life plus 70 years. We support SOCAN and CMPA and others in this request. Both the European Union and the United States provide copyright protection for a baseline term of life plus 70 years for authors of musical works, which includes publishers, songwriters, and composers. This will bring Canada in line with international intellectual property standards and trade agreements. It will also provide greater protection for Canadian creators of musical works, including songwriters, publishers, and composers.
Finally, renew support for music creators. We support the Canadian Private Copying Collective's recommendation for the creation of a four-year private copying compensation fund of $40 million annually. Music creators should receive fair compensation for private copies made of their music, and this fund is a good interim step until a more permanent solution can be found through legislative change. Ideally the Copyright Act needs to make private copying technologically neutral. Unfortunately, private copying is limited to media that are quickly becoming obsolete such as blank CDs.
Thank you very much. I now would ask Chris Moncada to say a few words.