Industry Committee on Dec. 10th, 2018

[Casey Chisick]

I understand the question.

This requires a review of 20 years of Copyright Board radio broadcasting tariffs, which obviously we don't have time for here, but the point of the matter is that, until 2016, radio broadcasters paid a certain amount for all of the copies they made. It was only in 2016, after the 2012 amendments had come into force, that the Copyright Board felt that it had to go through the exercise of slicing and dicing those copies and determining what value was allocable to which. It was then that the 22% exemption was instituted.

Your point is a valid one, because nothing had changed. The approach that radio stations take to copying music hadn't changed. The value that they derived from the copies hadn't changed. The only thing that had changed was the introduction of an exception that the Copyright Board believed needed to lead inexorably to a royalty reduction.

That's what I am reacting to, and that's what I'm suggesting to the committee ought to be re-examined.

[David de Burgh Graham]

My time is up. Thanks.

[The Chair, Liberal, Dan Ruimy]

Thank you very much.

Mr. Albas, you have seven minutes.

[Dan Albas, Central Okanagan—Similkameen—Nicola, CPC]

Thank you, Mr. Chair.

I'd like to thank all of our witnesses for their testimony here today.

In recent weeks we've been hearing from various witnesses favouring a change in approach in how we do copyright and moving to a more American-style fair use model. I would like to survey the group here.

What are the benefits of looking at American-style fair use? What should we take from that and what should we be very wary of?

That's for any of the panellists.

[Dr. Michael Geist]

I'll start by reiterating why I think it's a good idea, although I would argue not to jump in with the U.S. fair use provision but rather to use, as I mentioned, the “such as” approach and turn the current fair dealing purposes into a group of illustrative purposes rather than an exhaustive list.

I think that both provides the benefits of being able to rely on our existing jurisprudence, as it represents an evolution of where we're at rather than starting from scratch, and makes it a far more technologically neutral approach. Rather than every five years having people coming up and saying that you need to deal with AI or with some other new issue that pops up, that kind of provision has the ability to adapt as time goes by. We're seeing many countries move in that direction.

I would lastly note that in what's critical as part of this, whether you call it fair dealing or fair use, what's important is whether or not it's fair. The analysis about whether or not it is fair remains unchanged, whether it's an illustrative group or an exhaustive group. That's what matters: to take a look at what's being copied and assess whether it's fair. The purpose is really just a very small part of that overall puzzle, yet by limiting the list we then lock ourselves into a particular point in time and aren't able to adapt as easily as technology changes.

[Casey Chisick]

If I may, I agree with Professor Geist that the most important aspect of the fair dealing analysis by far is fairness, but there's a reason that Canada is one of the vast majority of countries in the world that does maintain a fair dealing system. There are really only, last I checked, three or four jurisdictions in the world—the U.S., obviously, Israel and the Philippines—that have a fair use system.

Most of the world subscribes to fair dealing, and there is a reason why. The reason is that governments want to reserve for themselves the ability from time to time to assess what sorts of views in the grand scheme of things are eligible for a fair dealing type of exception, and if we just simply throw the categories open to everything such as X, Y and Z, the predictability of that system becomes far less, and it becomes far more difficult for stakeholders and the copyright system to order their affairs. It becomes more difficult to know what will be considered fair dealing or what's eligible to be considered fair dealing and to plan accordingly.

Overall, Canada has exhibited a fair sensitivity to these issues. The fair dealing categories, obviously, were expanded in 2012 and may well be expanded again in the future when the government sees fit, but I think that to expand it to the entire realm of potential dealings runs the risk of going too far.

[Prof. Ysolde Gendreau]

I am against the idea of having a fair use exception for several reasons.

First of all, I think that in reality what we have already is very close to the U.S. system. We have purposes that are extremely similar to the fair use purposes. We have criteria that are paraphrases of the fair use criteria, and I really don't think that there is that much of a difference in terms of what the situation is doing. What is happening, though, is that, for the examples we have, it's not just “such as”. I see a very dangerous slope. “Such as” does not mean anything that is fair. “Such as” should mean that we keep within the range of what is already enumerated as possible topics, which is what we already have with our fair dealing exception.

Second, many of these fair use exceptions in the United States have led to results that are extremely difficult to reconcile with a fair use system. They are very criticized, and lastly, I would say that, in order for a fair use system to work in the magnitude that people would want it to work, you would need an extremely litigious society. We are about a 10th of the size of the U.S. We don't have the same kind of court litigation attitude as in the U.S., and I think that this is an important factor in order not to create uncertainties.

Thank you.

[Dan Albas]

Mr. Chair, I'd like to share the rest of my time with Mr. Lloyd, if that's all right.

[The Chair, Liberal, Dan Ruimy]

You have two minutes left.

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

Thank you, Mr. Chair.

Thank you to our witnesses today.

I have a couple of quick questions for Mr. Chisick. I wish all of you had been here earlier in the study. You could have helped us frame the debate a little more clearly.

One of your points was about closing the loophole about intermediaries. Could you expand on that and give us some real-life examples to help illustrate what you mean?

[Casey Chisick]

Obviously, as a lawyer in private practice, I have to be careful about the examples I give, because many of them come from the real lives of my clients and the companies they deal with from day to day.

What I can tell you is that it has been my experience that certain services—and I gave a couple of examples, both services that are engaged in cloud storage with a twist, helping users to organize their cloud lockers in a way that facilitates quicker access to various types of content and potentially by others than just the locker owner, as well as services that basically operate as content aggregators by a different name—are very quick to try to rely on the hosting exception or the ISP exception, the communications exception, as currently worded to say, “Sure, somebody else might have to pay royalties, but we don't have to pay royalties because our use is exempt. So if it's all the same to you, we just won't”.

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

They're going further than just being a dumb pipe. They're facilitating.

[Casey Chisick]

They are. That's right. They are, so my view is that the exception needs to be adjusted, not repealed but adjusted, to make very clear that any service that plays an active role in the communication of works or other subject matter that other people store within the digital memory doesn't qualify for the exception.

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

I will come back to you because I do have another question.

[Casey Chisick]

Okay.

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

I just wanted to get a quick question to Mr. Geist.

Am I out? Okay. Never mind.

[The Chair, Liberal, Dan Ruimy]

Sorry, but I'm glad you knew those terms that you were using.

We're going to move to Mr. Masse.

You have seven minutes.

[Brian Masse, NDP, Windsor West, ON]

Thank you.

The USMCA changes things in a couple of parameters. How does it change your presentations here?

I was just in Washington and there's no clear path for this to get passed. We could be back to the original NAFTA, and if that goes away then we're back to the original free trade, but that requires Trump to do a six-month exit and notification, and there's debate about whether or not that's on the presidential side or whether it's Congress and there will be lawyers involved and so forth. We're at a point now where we have a potential deal in place. Vegas is making the odds about whether it's going to pass or not.

Maybe we can go around the table here in terms of how you think it affects your presentations here and our review. We're going to have to report back with it basically being...and there are many with the opinion that Congress won't accept it because they don't have enough concessions from Canada.

I put that out there because it's something that changed during the process of our discussions from the beginning of this study to where we are right now, and again where we'll have to give advice to the minister.

We can start on the left side here and move to the right.

[Catherine Lovrics, Vice-Chair, Copyright Policy Committee, Intellectual Property Institute of Canada]

Among our committee there was no consensus with respect to term extension, so it wouldn't have been an issue that we addressed as part of our submission.

But as a result of term extension clearly being covered in USMCA we touched upon reversionary rights, because I think if copyright term is extended it's incumbent upon the government to also consider reversionary rights within that context. This is because at present you are effectively adding those 20 years if the first owner of copyright would have been the author and the author had assigned rights, and reversionary rights under the current regime with everything except for collective works, you would be extending copyright for those who have the reversionary interest and not for the current copyright owners. That was the way that IPIC submissions were impacted.

[Brian Masse, NDP, Windsor West, ON]

You're pretty well split within an organization about the benefits and detractions from—

[Catherine Lovrics]

For term extension, I think it's a very contentious issue and there was no consensus among our committee.

[Brian Masse, NDP, Windsor West, ON]

Would it be fair to say, though, it has significant consequences for opinions on both sides? It's not a minor thing. It's a significant one.

[Catherine Lovrics]

I think most definitely. I think there are both very strong advocates for term extension who look to international rights as being one justification for the reason to extend term, and I think there are those who view extending the term as limiting the public domain in Canada in a way that's not appropriate. Again, there's no consensus.

With USMCA proposing it, reversionary rights should be looked at.

[Brian Masse, NDP, Windsor West, ON]

Thank you.

Mr. Chisick.

[Casey Chisick]

I would agree with that. I mentioned reversionary rights in my presentation, and I don't want to be understood as necessarily suggesting that the way to deal with reversionary rights is to eliminate reversion from the copyright altogether. That's one possible solution, maybe a good solution. There are also other solutions, and certainly with the extension of the term of copyright, which I do think is a good idea, and I've been on the record saying that for some time, how you deal with copyright over that extended term is certainly an issue.

My main point, and it remains regardless of whether the term is life plus 50 or life plus 70, is where reversion is concerned we need to look at it in a way that's less disruptive to the commercial exploitation of copyright. I think the point remains either way.