Thank you.
Good afternoon Mr. Chairman and committee members.
My name is Cynthia Rathwell, vice-president, legislative and policy strategy at Shaw Communications. With me today is Jay Kerr-Wilson, a partner at Fasken, whose expertise is copyright law. We appreciate the opportunity to present Shaw's view on this review of the Copyright Act.
Shaw is a leading Canadian connectivity company that provides seven million Canadians with services that include cable and satellite television, high-speed Internet, home phone services and, through Freedom Mobile, wireless voice and data services.
Shaw expected to invest over $1.3 billion in fiscal 2018 to build powerful converged networks and bring leading-edge telecommunications and broadcasting distribution services to Canadians. Annually, as a content distributor, we pay tens of millions of dollars in royalties pursuant to Copyright Board-approved tariffs, over $95 million in regulated Canadian programming contributions, and approximately $800 million in programming affiliation payments, $675 million of which is paid to Canadian programming services with predominantly Canadian content.
Accordingly, Shaw understands and wishes to emphasize the importance of a copyright regime that balances the rights and interests of each component of the copyright ecosystem. This balance is central to Canada's interest in maintaining a vibrant digital economy.
Overall, our Copyright Act already strikes an effective balance, subject to a few provisions that would benefit from targeted amendments. Extensive changes are neither necessary nor in the public interest. They would upset Canada's carefully balanced regime, and jeopardize policy objectives of other acts of Parliament that coexist with copyright as part of a broader framework that includes the Broadcasting Act and the Telecommunications Act.
Proposals to increase the scope, and/or duration of existing rights, introduce new entitlements, or to narrow the scope of existing exceptions would increase the cost of digital products and services for Canadians; undermine investment, innovation and network efficiency; and impact Canadians' participation in the digital economy. Stakeholders who argue for new entitlements or limitations appear to seek a simplified response to global market developments that are impacting the production, distribution, consumption and valuation not only of copyrighted works but also of goods and services provided by many, if not most, industries. The responses of most businesses, including Shaw, to market disruptions have been to invest and innovate, diversify, and improve the quality of service and customer experience in order to compete. Fundamental changes in the digital marketplace cannot simply be offset by new legislative entitlements or protections.
Calls for new rights appear, in part, to be based on the suggestion that copyright is a tool for the promotion of cultural content. The Copyright Act is concerned with promoting efficient markets and supporting the creation of works but generally without regard to a creator's nationality or where the work was created. As a result, attempts to use copyright as a cultural policy instrument would undermine the achievement of domestic cultural policy objectives established by other statutes. A clear example of this is the Border Broadcasters, Inc.'s proposal for retransmission consent rights for broadcasters, which, it argues, would support the production of local programming. Shaw is strongly opposed to that proposal.
If adopted, it would disrupt carefully calibrated Canadian copyright and broadcasting policy. It would require Canadians to pay billions of dollars per year in new fees for the same services, a large part of which would flow to the U.S., while creating the potential for loss of access to programming, as well as service disruptions. These impacts would undermine the competitiveness of Canada's broadcasting industry, incenting subscribers to turn away from the Canadian broadcasting system, ultimately at the expense of the Broadcasting Act's objectives.
Canada's Copyright Act provides that services related to the operation of the Internet are exempt from copyright liability solely in connection with providing network services. It also provides that those furnishing digital storage space are exempt from liability in connection with hosted content.
As an Internet service provider, Shaw strongly submits that these exceptions should be maintained. ISPs benefiting from the network services exception are subject to obligations under the notice and notice regime, and protection is denied where a network is found to be enabling infringement. Furthermore, the hosting exception is not available with respect to materials that the host knows infringe copyright. That being the case, Canadian law strikes the correct balance between incenting investment in network services and ensuring that these services support the integrity of copyright.
Some stakeholders have also called for the narrowing or removal of existing exceptions, such as the technological processes exception, that enable end-users and service providers to employ innovative and efficient technologies to facilitate the authorized use of works. Shaw strongly believes that these exceptions represent a balanced approach that maximizes Canada's participation in the digital economy.
While Shaw believes that the Copyright Act overall is well balanced, minor changes should be made to the notice and notice framework to curtail abuses, such as regulations mandating that notices be transmitted to ISPs electronically and in a prescribed form. This has already been discussed in detail today.
As well, Shaw submits that new measures are needed to enable creators to enforce rights against commercial-level online piracy. This will help ensure that rights holders receive fair remuneration and that networks are protected from malicious malware frequently associated with piracy sites. We therefore support an amendment to the Copyright Act's civil remedies to clarify the Federal Court's authority to order ISPs to block access to websites found to be infringing.
In conclusion, Canada's Copyright Act achieves an appropriate and thoughtful balance between creator, user, and intermediary interests, subject to the minor amendments that we've recommended. The extensive changes requested by various stakeholders would disrupt the achievement of policy objectives pursuant to the overall legislative framework governing copyright, broadcasting and telecommunications.
Thanks very much. We look forward to your questions.