Industry Committee on Sept. 19th, 2018

[Jérôme Payette]

I'm not familiar with the example. I know who Aretha Franklin is and I know the song. I think there's copyright on the song, but there's also remuneration coming out of the recording of the song. I think she probably made money with the recording of the song. I'm not familiar with that case, but there is remuneration for performers. I think it's normal that writers get paid as well. The people who write the songs are very important.

[Lloyd Longfield, Liberal, Guelph, ON]

Yes. I guess that it's in terms of the interpretation of the song, but thank you for that. It was quite the tragic story, when we lost her this summer.

If I could pivot over to Mathieu and Stéphanie to look at how a Canadian author makes a living in 2018 and the emerging trends on authorship. There was a connection I could see between the Movie Theatre Association of Canada and the payment of music creators and music performers versus the authors who get paid for writing screenplays and scripts. Is there a difference there that you know of? Are they paid about the same or in the same types of ways?

I could maybe follow up through Michael Paris to see whether there's agreement or whether there's knowledge you can share on that.

[Stéphanie Hénault]

We have not talked about that. That being said, the role of the scriptwriter is more important than that of the music composer.

You want to know if we support the demand for additional compensation when a film is presented. We will have to think about it. In general, we always maintain that creators should be paid not only for creating, but also in proportion to the use of their work. The proposal put forward calls for additional compensation depending on use. The community of creators shares this view and considers it important.

[Lloyd Longfield, Liberal, Guelph, ON]

Right. What is the focus on creators?

[Mathieu Plante]

This is called being connected to the economic life of a work: if a film or television show is very successful, it should be possible to be connected with it and to benefit from that.

[Lloyd Longfield, Liberal, Guelph, ON]

I'm sorry, we've run out of time.

[The Chair, Liberal, Dan Ruimy]

I'm sure you would be able to get back to him. We're out of time on that one.

We're going to move to Mr. Lloyd.

You have seven minutes.

[Dane Lloyd, Conservative, Sturgeon River—Parkland, AB]

Thank you, Mr. Chair.

Thank you to all the witnesses for being here today. We've spent many hours poring over this thing, and now that we're back from the summer, it's good to get a refresher on the issues here.

My first line of questioning will be for you, Monsieur Payette. You may have heard recently that the artist Bryan Adams spoke in front of the heritage committee, where he made a recommendation related to something called the reversionary right that musicians have. In Canada, you have a reversionary right 25 years after your death, and in the United States, your reversionary right is 35 years, and it doesn't have to be after your death. It can be within your lifetime.

I was hoping you would have a comment on that testimony and what the perspective of your stakeholders would be.

[Jérôme Payette]

I don't think it would be necessary to be in the law. The composers don't have to sign an assignment of rights to work with a music publisher, and they don't even need to work with a music publisher because some people do their own business by themselves.

There's nothing in the law that stops what we're discussing being effective in a contract. You could say that after 35 years the copyright would go back to the composer. That's already possible to do if we wish to do it, and I think there's a difference between the ownership and the remuneration. I think what's important for copyright owners is the remuneration side, and that's what we should focus on. How much value can we give to copyright and how much money can we bring to the music industry?

I'll end by saying that music publishers have catalogues of copyright that bring in steady streams of revenue, which are used to reinvest in new talent. We have to keep that in mind. That's the business model of music publishers.

[Dane Lloyd, Conservative, Sturgeon River—Parkland, AB]

I'm not sure if you're familiar with Mr. Adams' statement that he made at the heritage committee, but you're saying that there is no firm reversionary right in Canada, that it's a pretty open-ended free market system. You can give away your rights for as long or as short a time as you like, and it's all negotiation.

[Jérôme Payette]

Yes, you can do whatever you want.

[Dane Lloyd, Conservative, Sturgeon River—Parkland, AB]

Okay, that will be very interesting for us to look into further.

You also alluded to recent European rules related to content filters. Can you elaborate on how that impacts you as an industry?

[Jérôme Payette]

I was not referring to content filters but what they have done in Europe, especially concerning article 13. They said that it's a communication to the public even if the work has been uploaded by a user.

Right now, if I put something online, it's protected. If it's user-generated content, the platform doesn't need to pay and they don't need to have a licence. So the change is that they will need to have a licence and to pay the right holders, even for user-generated content, and they will have to be more transparent. Those companies are not transparent about what's being used, and it's the content of the right holders and the creators that's there, and we don't know what's happening with it.

[Dane Lloyd, Conservative, Sturgeon River—Parkland, AB]

Do you think it would increase transparency if we were to adopt a European-style model?

[Jérôme Payette]

Yes, exactly, and there would be higher rates for the whole music industry, all the content online, and I think that's what they're going after in Europe, making YouTube and others pay more to right holders.

[Dane Lloyd, Conservative, Sturgeon River—Parkland, AB]

Thank you.

My next line of questioning is for you, Mr. Tacit. There was a recent Supreme Court case related to ISP cost recovery, and I was hoping that you could elaborate on the impacts of the Supreme Court case on your stakeholders and your views going forward.

[Christian Tacit]

Our views are that, if ISPs are compelled by law to provide certain services to assist in enforcing copyright or identifying copyright infringement, they should be compensated for that fairly.

The reality is that ISPs are the telephone companies of the present world. Their role is to carry content, not to question it or examine it, and I don't think in a democratic society we want to deviate from that very much. If they're compelled to basically try to perform a state function, then the state should compensate them for that, or there should be some mechanism, maybe not through the state, but through the parties who have a personal, private or commercial interest in enforcing their rights to compensate them.

[Dane Lloyd, Conservative, Sturgeon River—Parkland, AB]

What do you estimate the cost is to an ISP to perform these functions?

[Christian Tacit]

That can vary widely. You have large ISPs that have automation tools and you have mom-and-pop shops that do things very manually, so the costs can be all over. I'm not in a position to tell you that. There were some studies done previous to the notice and notice regime that tried to put a handle on the cost, at least at that particular time period.

We haven't delved into that issue very much in the last few years because it was taken off the table when the government made the choice not to compensate ISPs for processing notices. Given that no regulation was passed authorizing a fee and at that time the law was stable and the notice and notice regime was stable, we didn't, at least as an association, keep delving into that, but there's probably data out there, and we could follow up with you if you're interested.

[Dane Lloyd, Conservative, Sturgeon River—Parkland, AB]

Do you view new technology as bringing down that transaction cost? Do you think there's a lot of potential to basically minimize the costs to ISPs?

[Christian Tacit]

New technology brings down the costs of everything we do.

[Dane Lloyd, Conservative, Sturgeon River—Parkland, AB]

Would your opposition to this then, if the costs were to be brought down significantly, also go down?

[Christian Tacit]

The cost is what the cost is. Whether it's 10 bucks, 100 bucks or a dollar, I don't think the principle of cost recovery is any different.

Again, if you're being compelled to do something that ultimately is determining rights between private parties, enforcing rights, even if they're statutory rights, you should be compensated for that.

[Dane Lloyd, Conservative, Sturgeon River—Parkland, AB]

Thank you.

[The Chair, Liberal, Dan Ruimy]

Thank you very much.

We're going to move to Mr. Masse.

You have seven minutes.