Unravelling the Complexities of the Canadian Content (Cancon) Conundrum

Credit: shutterstock

Feds to modernize definition of a Canadian film and TV program” screamed the headline. The Canadian Press story, repeated in newspapers across the country early last month, was based on comments by Canadian Heritage Minister Pablo Rodriquez who declared that as part of the process of enacting Bill C-11, now known as the Online Streaming Act, he wants to modernize the definition of Canadian content and is “open to all kinds of suggestions and ideas.” If this is really true, he will get an earful. The Canadian Content rules (Cancon for short) are one of the most complicated and convoluted aspects of Canada’s broadcasting and audio-visual policy, with multiple stakeholders engaged, many of whom have divergent, or at least not fully aligned, interests. It is a policy that is difficult enough to explain, let alone to find the secret formula to untie the Gordian knot that Cancon has become. But first, let me attempt to explain the policy.

Cancon regulations go back to the 1970s and are designed, in theory, to promote Canadian culture and identity through the production of more Canadian content, basically to help offset the cultural tsunami existing next door in the United States. They apply to audio-visual (AV) productions (movies and TV shows), as well as music, but I am restricting my comments here to Cancon regulations applicable to the AV sector.  How do the Cancon regulations work, and do they in fact achieve their professed goal? Cancon requirements are implemented in two ways; by requiring that a certain percentage of content broadcast on television stations based in Canada meets minimum Canadian content quotas and by increasing production of Cancon by providing financial subsidies to productions that qualify as Canadian. Some of these funds come from mandatory contributions (a percentage of revenues) imposed on broadcasters and cable distributors by the Broadcasting Act as a condition of licence. The intent of C-11 is to extend the reach of the Broadcasting Act to encompass online streaming services, making them subject to oversight by the broadcast regulator, the CRTC. Among other things, the Bill would empower the CTRC to apply Cancon requirements or other “discoverability” obligations to online streamers, whether they are based in Canada or not. Europe has already taken similar measures. Thus, what qualifies as Cancon is a critical piece of the puzzle. 

Most Canadians would probably think the objective of the Cancon policy is to create more productions that tell Canadian stories–stories written by Canadian writers, stories set in Canada, stories featuring Canadian actors, stories that reflect Canadian realities, and so on. But they would be wrong, as is frequently pointed out by the media when running stories on Canadian content. The current poster child for this anomaly is the Disney animated feature Turning Red, set in Toronto, featuring the story of a young Chinese-Canadian girl growing up in the city, and starring Canadian actor Sandra Oh. It may look and feel Canadian, but it does not qualify as Cancon because it was made by Disney, a non-Canadian entity. Disney financed it and holds the copyright. Nor did the adaptation of Margaret Atwood’s Handmaid’s Tale (filmed in Cambridge, Ont.) or Amazon Prime’s recent series on the Toronto Maple Leafs qualify. This is because there are complex financial, management, creative and intellectual property formulas that govern what is considered Canadian content. On the other hand, some obscure co-production with another country that has no distinguishable Canadian features at all can qualify. The varying requirements to be Cancon-certified are overseen by three different organizations, the Canadian Audio-Visual Certification Office (CAVCO), a unit of the Department of Canadian Heritage, the broadcast regulator, the CRTC, and Telefilm Canada, a government corporation, which certifies treaty co-productions. There are common features but not all certification requirements are the same.

For CAVCO, there are four key elements that are taken into consideration; production control, copyright and distribution rights, creative positions and production spend. The producer must be the central decision maker and must be Canadian. With regard to the intellectual property, unless the film is a treaty co-production, the Canadian production company must be the copyright holder for all commercial exploitation purposes for a minimum of 25 years. As for distribution, the producer must control the initial licensing of all commercial rights and there must be an agreement with a Canadian distributor or a CRTC-licensed broadcaster to show the production in Canada within the first two years of release. Now we come to the creative positions and the (in)famous points test.

A production must achieve a minimum of 6 out of 10 points to be considered Canadian under both CAVCO and CRTC rules. Under this system, the writer gets 2 points; the director gets 2 points. Either the writer or the director must be Canadian. The highest and second highest paid performers each get 1 point and one of these two must be Canadian. For live action productions the other 4 points go to the Director of Photography, the Production Designer; the Music Composer and the Picture Editor. Those people born in Canada who have made it big in Hollywood, and who have retained Canadian citizenship, are invaluable for their points! Some sources of funding, like the Canada Media Fund, require a full 10 points out of 10. Finally, there is the production spend. Seventy-five percent or more of all cost for production services must be payable to Canadians and a similar percentage of all post-production costs must be incurred for services provided in Canada. If a production is CAVCO certified, it qualifies for Cancon tax credits (a straight financial subsidy).

CRTC certification is different and is not quite so stringent. It does not qualify a production for CAVCO Cancon tax credits but does provide access to less generous Production Services Tax Credits. Under CRTC certification a minimum of 6/10 points is required, the producer must be Canadian and 75% of the cost of production must be spent in Canada or on Canadian services. The CRTC also imposes Cancon quotas on Canadian broadcasters, a percentage of on-air time and a percentage of revenues dedicated to Canadian production.

Then there is Telefilm Canada, the agency that administers the co-production agreements that Canada has with more than sixty countries, but, significantly, not the United States. The US does not need co-production agreements. It has Hollywood. Depending on the amount of financing from each of the co-production partners, the copyright ownership, per country budget spend, split of creative and key crew roles, the production activity allocation and the distribution rights are roughly divided according to the respective share of financing from each partner. To the uninitiated Cancon is, (as Winston Churchill famously said when referring to Russia prior to WW2), “a riddle, wrapped in a mystery, inside an enigma”. As I have noted above, qualifying as Cancon is important for two key reasons; to meet regulatory requirements (spending and airtime quotas) for broadcasters–and potentially for online streaming services if the Online Streaming Act passes in its current iteration–and to be able to access financial subsidies, aka tax credits.

That is what Cancon is.[i] What it clearly is not, is a system designed to encourage the telling of Canadian stories or stories by Canadian authors through film and television. The fact that Atwood’s Handmaid’s Tale, Life of Pi written by Canadian author Yann Martel and The English Patient written by Michael Ondaatje did not qualify as Cancon demonstrates this, although there is nothing particularly Canadian about any of these stories. The fact that the films were made without any need for CAVCO tax credits perhaps illustrates that good stories will get made, regardless of the nationality of the author.

So what is a Canadian story? According to retired media executive Richard Stursburg in his recent book The Tangled Garden (A Canadian Cultural Manifesto for the Digital Age), productions funded with Canadian money should look Canadian. He laments the fact that many Canadian productions are “Americanized” to make them more attractive to US audiences, and thus more commercially valuable. The cops don’t look like Mounties, the cityscapes look like any random North American city with all distinguishing Canadian features excluded, even the accents are the same. Contrast this to British productions that are clearly British. There is no mistaking Line of Duty for FBI. I guess part of Canada’s problem is that so much of it looks like parts of the US. And except for the Newfies, it is pretty hard to distinguish a Canadian accent from a middle-of-the-road US accent. The Brits have no such problem. (By the way, have you noticed how villains almost always talk with a British accent—at least Canadians don’t have that cross to bear!)

But does a production have to look Canadian to be Canadian? Not all productions lend themselves to portraying Canada. What about Sci-fi? Do the aliens have to end every second sentence with, eh? And then there are the kids shows. Kids really don’t care much about the national origins, accents or behaviour of the animated characters they are watching, as long as they are entertained. Look at the success of Peppa Pig in North America, plummy British accents and all. And Bugs Bunny’s Brooklyn/Flatbush accent has gone around the woild. Then there is Caillou, the misbehaving little boy that many parents apparently blame for their own kids temper tantrums. Caillou is one of Canada’s contributions to the world of children’s cartoon characters, for better or for worse. His two authors, Christine L’Heureux and Hélène Desputeaux, have spent most of the past two decades legally scratching each other’s eyes out over ownership of the character’s copyright, as I noted in a blog post about a year ago. (“Caillou: Did the Little Boy’s Bad Temper Spill Over to the Copyright Squabble between his two “Mothers”?) The kid’s bad behaviour is apparently contagious.

However, let’s get back to defining Canadian content. One idea is to provide tax credit incentives to shows that look more Canadian or tell Canadian stories, regardless of the source of the money. That is what is done in Britain where there is a broader definition of what is British. There has to be a minimum amount of production done in Britain, as in Canada, but the “Britishness” of stories is a positive factor, and foreign financing is not a disqualifying factor. Thus, the Harry Potter films, made by Warner Bros. qualify. And why not? What is more British than Hogwarts?

This is part of the dilemma that Minister Rodriguez is facing. How to define Cancon, and how to support Canadian producers, while encouraging foreign producers to undertake more production of Canadian stories. It is worth noting that Cancon aside, foreign filmmakers have made Canada one of the prime locations for movie production outside the US, bringing plenty of good jobs to the industry. There is lots of “Foreign Location Shooting” (FLS) taking place in Canada that benefits from Canadian provincial tax credits, but which makes no pretence of representing Canada or Canadian stories in any way. FLS does not seek to access Cancon subsidies. Foreign, mostly US, studios film in Canada because Canada offers tax incentives, skilled crews, good locations and lower costs while being close to US centres. They churn out product for the US market using US stars and Canadian crews. The recent Nordicity study shows that almost twice as much is spent in Canada on FLS than on Cancon productions. This FLS production is good news for those Canadians engaged in the film and TV industry, but apart from building and maintaining production capacity, does nothing to promote Canadian content.

Netflix, for example, is one of the largest producers of content in Canada through its FLS productions but no matter how Canadian it makes its stories, under the present rules its product will not qualify as Cancon because the producer (Netflix) is not Canadian, and the copyright is not held by a Canadian. If the CRTC imposes a “compulsory contribution” of a percentage of revenues generated in Canada on streaming services, the foreign streamers will be helping to finance Cancon production with no guarantee of getting distribution rights, while still possibly having to meet some kind of Cancon quotas (which are more difficult to implement with regard to on-demand streaming services as opposed to linear broadcasters). They could, of course, seek to license productions from the Canadian producers, who are eager to tap into the resources of the big streamers to help finance their own productions. But again, depending on what definition of Cancon emerges from this process, the end result may not look or feel any more Canadian than any other production. As for the Canadian public, a recent poll from Nanos Research indicates that two-thirds of Canadians support or somewhat support foreign streaming services financially supporting the creation of Canadian content in the same way that Canadian broadcasters do. That’s assuming that the Canadian public actually understands how Cancon works and what Cancon is.

What will the solution be? Does Cancon have to be recognizably Canadian? To promote Cancon, does the content have to be produced by Canadians and the copyright held by Canadians? Is the goal to promote jobs and grow the industry or to promote content that strengthens Canadian identity? Is it possible to do all of the above? I don’t have the answers. Minds greater than mine have laboured over this question for years and many recommendations have been brought forth. If the legislation passes, (and I assume it will after review in the Senate now that it has been voted out of Committee in the Commons), it will still take some time for the definition of Cancon to become clear as the Bill requires the CRTC to come up with a definition, after public hearings. However, the CRTC will also be required to take into account guidance provided to it by government which includes, among other things, an obligation to consider copyright ownership and distribution control by Canadians. It is going to be a long process.

It is easy to throw stones at the present system because it is open to question as to whether it has achieved its desired policy goals, although what those policy goals actually are is part of the question. One thing is certain; change is coming. Whether Rodriguez will be able to thread the needle to satisfy Canadian cultural nationalists, the Canadian film industry, the film industry in Canada (not the same thing) as well as the foreign studios and streamers remains to be seen. Cancon is not going to go away. Whether it can be adapted to the realities of the digital age is another question.

© Hugh Stephens, 2022. All Rights Reserved.


[i] My thanks go to Peter Grant for providing background materials, including a presentation by Doug Barrett and Erin Findlay prepared for the DM@X-tra conference in March of this year.

Was it Careless Infringement (but for a Good Cause) or a Derivative Design Inspired by Another Indigenous Artist? (The “Every Child Matters” Copyright Story)

Credit: Michelle Stoney. Used with permission

Sometimes copyright issues are essentially black or white. There was obvious infringement. It was done for commercial gain. It was bad; it shouldn’t have happened. Period. Often, however, things are not so clear and there are various shades of grey involved. This is one of those cases. I will let you be the judge since this is unlikely to go to court, except perhaps the court of public opinion.

While grey may be one colour to describe this case, in actual fact the most appropriate colour is orange. That is the colour that was selected as part of a campaign to bring to public attention the legacy and shameful history of Canada’s Indian residential schools, marked by National Truth and Reconciliation Day (a new public holiday beginning in 2021 on September 30 of each year). The slogan “Every Child Matters” was added in memory of the tens of thousands of children who were sent to these schools, especially the not inconsiderable number who died, often from epidemics that swept the schools owing to poor food and unsanitary conditions. The symbol of a handprint, often in orange, or white or black on orange, has come to be accepted as a symbol of the lost children. Suspected unmarked graves have been located at many residential schools adding to the poignancy of the slogan.

It is in this context that our copyright case arises. Michelle Stoney is a well-known and respected Gitxsan artist from Hazelton, in northern British Columbia (BC). She is a graduate of the Emily Carr University of Art and Design in Vancouver. In 2019 she won the Crabtree McLennan Emerging Artist Award awarded by the BC Achievement Foundation. She sells her artwork, which is based on traditional Gitxsan designs, through her website, via Etsy, and other online outlets. One of her more prominent works is a human hand in the form of a Gitxsan design (the image at the top of this blog post, on the right). That is the background on Michelle.

Now, like a novelist starting a different thread in a story, a thread that will eventually join the others as the story reaches its climax, I am going to change gears, and talk about lacrosse. Lacrosse is North America’s oldest sport. A form of outdoor lacrosse was played by native tribes in contests that sometimes lasted for days in the St. Lawrence Valley as early as the 1600s, when Europeans first wrote about it, but it probably pre-dates European contact. In the 1860s the rules of field lacrosse were codified, and it became known as Canada’s national game. This was an unofficial designation as it competed for this title with ice hockey. (In the 1990s the Canadian Parliament adopted a motion naming lacrosse as Canada’s official “summer game” and ice hockey as its “winter game”.) Many of the players then and today came from the indigenous (First Nations) community. In the 1930s box lacrosse was developed as a sport that could be played in unused hockey arenas during the summer, and box lacrosse is the one form of the game that has enjoyed commercial success as a professional sport. In the 1990s the National Lacrosse League (NLL) was established in the US. Today, it is based in Philadelphia and has 14 teams. Nine of these are in the US and five in Canada. The vast majority of the players are Canadian, many of them from First Nations.  In short, there is a strong connection between the sport and First Nations communities.

This is where I bring the two strands of the story together. The CBC recently reported that Michelle Stoney had learned that the NLL had copied her Gitxsan hand design and was using it on orange tee-shirts that it was selling to raise funds for causes associated with those who attended former Indian residential schools. The NLL website promoted the tee-shirts as follows;

“Join the National Lacrosse League in raising awareness about Native American residential and boarding schools, which were created to isolate indigenous children from the influence of their culture in order to assimilate them. This Every Child Matters warm up shirt was designed by Dave Sowden, a Halifax Thunderbirds employee of Indigenous descent, and is a replica of the shirt worn by NLL players during week six of the 2021-22 season. Your purchase tells us that you support our NLL Unites initiative in support of the Every Child Matters movement and the NLL will donate directly to the Gord Downie & Chanie Wenjack Fund and the National Native American Boarding School Healing Coalition.” (the Gord Downie & Chanie Wenjack Fund aims to build cultural understanding and create a path toward reconciliation between Indigenous and non-Indigenous peoples.)

You couldn’t find a better cause. The initiative appears to have been started by the Halifax Thunderbirds NLL team. Its owner, Curt Styres, is the only owner in the league of native descent; the team’s captain, Cody Jamieson is likewise from a First Nations family. According to reporting in a Halifax university journal, the Thunderbirds’ involvement began with orange jerseys with stylized handprints on them. The handprints were provided by Donna Longboat, Jamieson’s grandmother and a residential school survivor and Vera Styres, Curt Styres’ mother, also a residential school survivor.

So how did we go from Donna Longboat’s and Vera Styres’ handprints to Michelle Stoney’s design? The path is not clear. According to the CBC report, Stoney’s original design was created for Orange Shirt Day on Sept. 30, 2020. It comprises mountains and trees to represent the Gitxsan Nation, the flowers to represent children, and the feathers to represent the children who were lost in residential schools. When Stoney saw the lacrosse adaptation on the Facebook page of the Vancouver Warriors lacrosse team, she says she immediately recognized her design. While a hand is a hand, the lacrosse version also features stylized fingers based on feathers, similar or identical to the feathered fingers on Stoney’s artwork. She says it appears that the designer of the NLL version “flipped” her work by tracing the hand and adding the words “Every Child Matters” to replace the mountains, trees and flowers on the palm of her piece. I am guessing that this is pretty easy to do with design software.

Stoney is not making this about financial compensation, although she earns her living through her art. Rather, she says she is okay with others using her creative works, such as the Indigenous feather design, as long as they seek her permission. It’s about moral rights. And she wants an apology. The Warriors removed the design from their webpage, and said they are investigating. I contacted the Thunderbirds for comment, but none was forthcoming.

This episode, which has all the hallmarks of unintended consequences, raises two issues; the appropriation of native designs for commercial purposes, about which I have written in the past, (“Copyright, Folklore and Traditional Native Culture”) and whether adapting the essential elements of a design into a new work is a fair dealing (or fair use in the United States), not constituting an infringement because a new work has been created. Michelle is not the only native artist to have had work copied without permission or compensation. Often overseas vendors simply pick up and copy what they perceive will be a popular design and then sell it on Etsy, Facebook or Amazon. Apart from blatant copyright infringement, there is the cultural appropriation aspect to consider. This latter issue raises many questions. Are only native artists allowed to create native designs? Who qualifies as an indigenous artist? Do you have to hold a status card or simply self-identify? It can get very messy and complicated very quickly. The main message, I think, is to show respect for the artist and their culture and don’t infringe.

Which brings me to the second point. Is the work produced by the Halifax Thunderbirds an infringement? It would take a court ruling to determine that, and that is not going to happen. However, there are a couple of factors to consider. A copy does not have to be an exact copy to be an infringement. There is currently a high-profile case wending its way through the US judicial process (Warhol v Goldsmith). In this case, in 1984 artist Andy Warhol was commissioned to create an image of the musician Prince. Warhol painted a series of silkscreen images on canvas, based on a photograph taken by professional photographer Lynn Goldsmith. (The likeness is almost identical). Upon publication of one of the portraits after Prince’s death in 2016, Goldsmith saw the work and threatened to sue for infringement. In response, the Warhol Foundation launched its own suit seeking a declaration of non-infringement. The Foundation won round one. Goldsmith appealed and won round two. Now it is going to the Supreme Court of the United States for adjudication.

How different does a derivative work have to be to avoid infringement? In the case of Warhol v Goldsmith, the case hinges on the US legal doctrine of “transformation”. Is the derivative work sufficiently different from the original? Has the original been transformed into something new? Although in the case of Canada, there is no transformation doctrine per se, a change of medium will be a factor in favour of non-infringement. In the “Every Child Matters” hand design case there is no change of medium. However, there is still another question as to whether the design produced by the Thunderbirds qualifies for separate copyright in its own right. It’s possible.

In trying to determine whether the Thunderbirds’ depiction of the hand design infringed Stoney’s copyright, we can turn to the Canadian Copyright Act. Section 3 (1) states that “copyright, in relation to a work, means the sole right to produce or reproduce the work or any substantial part thereof in any material form whatever…” (emphasis added). So, the work that Michelle Stoney created and any substantial part of it (substantiality is subjective and is normally decided on a case-by-case basis) belongs to her. On the other hand (and in copyright there is always an “other hand”), Section 32.2 (1) states;

It is not an infringement of copyright (a) for an author of an artistic work who is not the owner of the copyright in the work to use any mould, cast, sketch, plan, model or study made by the author for the purpose of the work, if the author does not thereby repeat or imitate the main design of the work;”

Did the Thunderbirds’ author do more than simply imitate the main design of the work? If he did base his design on Michelle Stoney’s work, did he use a “substantial” part of it or was the use insubstantial? How much originality did the artist who created the lacrosse tee-shirt design put into it, and is that artist then also entitled to assert copyright for that work (Image above—left side)? According to Canadian jurisprudence, a “mere copyist” has no right to independent copyright but, according to this legal blog, “a work which has been substantively derived from pre-existing material will be entitled to copyright if sufficient time, effort, labour and skill have been bestowed”.

That is indeed the question. Learned copyright counsel, judges and law professors will all no doubt have opinions on this question. Since I am none of the above, I won’t hazard a guess. I will say that while it is clear that anyone can legally create a design based on a hand, or a design using a hand with feathers for fingers (since copyright protects only the expression of an idea, not the idea itself), to me the finger feather designs in the second work (created by the Thunderbird organization) look remarkably similar to Michelle Stoney’s design, right down to the smallest detail such as the shapes and regularity of the spaces separating the parts of each feather-finger. It is hard not to draw the conclusion that her design was the basis on which the second work was created. However, is the second work simply a partial copy or is it sufficiently original to be a work in its own right? You be the judge.

If there is a lesson here, it is that it’s always best to communicate with an “author” (which could be an artist, composer, writer) if you are going to adapt or borrow from their work. I understand that this is what finally happened, retrospectively. Curt Styres reached out to Michelle Stoney, apologized, and asked if she would design something for him in future.

At the end of the day both Michelle Stoney and Curt Styres had the same broad objectives in mind; to highlight the plight of survivors of Indian residential schools and to contribute to reconciliation as a way of moving forward. It is a shame that the dispute had to occur, but perhaps it is a “teachable moment” about how careful we all need to be with the images that are so ubiquitous and easy to access on the internet. It is all too easy to succumb to the temptation to do what is quick and easy. Respecting the original author/artist is a good lesson for all of us, and I am glad that this story had a happy ending.

© Hugh Stephens 2022. All Rights Reserved.

O Hypocrisy! U of T Sues Tutorial Service for Copyright Infringement After Ripping Off Authors for the Past Decade

O Hypocrisy, know ye no bounds? That was the thought that flashed into my head when the University of Toronto (U of T) announced that it was suing Easy Group, a Toronto based tutorial service catering mainly to international students, for copyright infringement. According to a bulletin issued by the university, the institution–in concert with three of its professors (who actually hold the copyright on materials they have produced or compiled)–has filed a lawsuit against Easy Group (aka Easy EDU) alleging it routinely copies, without authorization, lecture slides, course syllabuses (or is it syllabi?), tests and exams and sells them in “course-packs” to students on its website in violation of the Copyright Act. Easy Group apparently also offers university course materials from classes given at other Canadian universities as well, including the University of Waterloo, York, McGill, UBC, and the University of Alberta. U of T is seeking damages and disgorgement of profits or statutory damages in lieu, as well as punitive and exemplary damages as a result of Easy Groups “wilful and malicious” disregard for the university’s and the professor’s exclusive economic and moral rights, return of the copyright infringing materials and a court-issued injunction to stop future infringement.

Both The Varsity and Globe and Mail have reported on the case, largely echoing the U of T statement. What neither mentioned was the irony, one might say hypocrisy, of a major Canadian post-secondary institution suing an educational tutorial service for copyright infringement when U of T, along with most other Canadian post-secondary institutions, have been using, without authorization, educational materials—books, articles, etc—for more than a decade based on the argument that use of such materials for educational purposes is an allowed fair dealing exception under the Copyright Act (subject to certain limitations). Education was added as an exception when the Copyright Act was “updated” in 2012. Most universities promptly used the exception as the pretext to cease licensing materials from Access Copyright, the collective representing writers and publishers in Canada. Until then, licensing had provided a means for universities to copy specified amounts of material held in Access Copyright’s repertoire, by paying a set amount per student per year. Where the amount could not be agreed by negotiation, the Copyright Board of Canada was called on to review evidence regarding the amount of copying taking place and set a tariff that would be applied to both the provider (Access Copyright) and the users (universities).

When York University objected to the tariff fixed by the Copyright Board of Canada and refused to pay it, the stage was set for years of expensive litigation. Access Copyright won round one at the Federal Court. York appealed and won a partial victory at the Federal Court of Appeal (FCA), although its claim of fair dealing was not upheld. The FCA ruled that the Copyright Board’s tariff was not binding on York. Both sides then appealed to the Supreme Court and last summer the Court upheld the FCA’s decision on the non-binding nature of the Copyright Board’s tariff, effectively gutting Canada’s collective licensing system. The legal process has taken almost a decade. Meanwhile Canada’s writers and educational publishing sector has been deprived of approximately $200 million in revenues, with the inevitable result that educational publishing in Canada is on life support. Have the “savings” been passed on to students? Dream on.

The universities routinely help themselves, without authorization and without payment, to material published for the educational market to compile course-packs—which they sell to students—arguing that they are exercising on behalf of students their right to access materials under the rubric of fair dealing for private study and educational purposes. The fact that the universities and their professors claim to be exercising the right on behalf of individual students provides the pretext to copy large amounts of materials, well in excess of reasonable guidelines. While Access used to license one chapter in a book, or one article in a publication, now the universities have unilaterally decided that such use falls under fair dealing. Not only that, but different elements of a book or publication are often used by different teachers for different courses, with the result that the entire work, or most of it, is being exploited without any licence permitting the use. The fact that U of T is now suing an educational tutoring service, admittedly one that is operated for commercial gain, for doing essentially the same thing, is ironic. It is even possible that some of the course-packs that Easy Group is accused of infringing contain some content from Access Copyright’s repertoire that the universities have decided they can use without authorization.

One wonders whether Easy Group could make the argument that it was exercising the fair dealing rights of its clients, who are students, in much the same way that the university sector claims that it is using unlicensed materials for the benefit of students, not itself. That would probably be a stretch and we are not likely to find out whether such a defence would prevail, since a tutorial services, even one as apparently successful as Easy Group, is not likely to mount a court challenge in the same way that the educational sector engaged in a well-funded tooth and nail legal fight for over a decade with Canada’s writers and publishers. More likely is they will strike some kind of agreement with U of T to cease using these materials. If they do not defend the case, they risk a summary judgment and a finding of what could be crippling statutory damages.

Easy Group was founded in 2014 by U of T graduate Jacky Zhang. It’s self-proclaimed guiding principles are “integrity, inclusivity and innovation”. It offers five services; tutoring and cultural integration, career counselling, college counselling, student services (assistance with housing, transportation, visa applications, tax regulations etc.) and reference services for educational resources. It appears to cater largely to international students. According to its website, which is in English and Chinese, it has 300,000 clients and has offices in Canada and China. Its Canadian office is on Bloor Street adjacent to U of T’s main campus. In other words, it is not some shadowy web presence. It will have to deal with these accusations, which in the past it has apparently ignored. Its recalcitrance helps explain the reason for the university going to court.

I am not defending Easy Group’s practices, but one cannot help but wonder if the U of T administration feels even the least bit uncomfortable coming down hard on a student tutorial service for infringing its copyrights when it has been justifying its own unauthorized use of the copyright- protected works of others for the past decade by hiding behind the education fair dealing exception. U of T claims to be concerned about the potential impact on its students of using these unauthorized materials, even pointing to a student that was suspended for violation of the university’s academic integrity policies. But universities in Canada routinely serve up unauthorized copies of materials to their students in course-packs containing materials lifted from educational publications.

The objective of higher education is to help students learn and succeed in their studies. To do this we need professors who create compelling content and teach it well, we need institutions that provide the structure and framework to deliver that knowledge, and we need creators of knowledge—writers, publishers, researchers—to produce the teaching materials. In other words, we need to rely on the full ecosystem that disseminates and advances learning—damage one part and you damage it all. In its Statement of Claim, U of T makes reference to Easy Group’s “disregard for the intellectual property rights of others”, and the “serious and irreparable harm and damage” suffered by the university and its professors from these infringements. But surely what is sauce for the goose is sauce for the gander. When it came time to respect the intellectual property rights of writers and publishers, U of T and other universities, abetted by faulty legislation, have been more than willing to take a free ride on creators of educational content by invoking a flawed fair dealing exception that has driven a spike through the previously balanced copyright system. If any group has suffered “serious and irreparable harm and damage”, it is Canada’s writers and educational publishers. The smell of U of T’s hypocrisy permeates the air.

It is time for Parliament to rectify its error and close the education fair dealing loophole to restore some balance into the market for educational materials. The solution is quite straightforward; amend the Act so that educational fair dealing does not apply to educational institutions where a work is commercially available, as was recommended by the Standing Committee on Heritage in 2019. There were cryptic references in the recent Budget document to the effect that the government will work to ensure a “ensure a sustainable education publishing industry including fair remuneration for creators and copyright holders…” through the Copyright Act.

Maybe that means this major breach in the system will be closed by amending the Copyright Act. But when? In the meantime, the post-secondary educational sector is using that same law to defend its interests against alleged infringement. U of T no doubt does not see this as hypocrisy; why shouldn’t it defend its rights and the rights of its professors? But that decision would have been easier to understand if the university sector generally had not fought against writers and publishers—creators who share the same goals as they do—by refusing to license and pay for educational materials they use in the daily instruction of their student body.

© Hugh Stephens, 2022. All Rights Reserved

Ukraine: Protecting Its Culture and its Future

The war grinds on. Every day we see distressing, tragic coverage of the brutal destruction wrought by Russian forces as they try to crush Ukraine’s resistance. How and when it will end is not evident at this point. The invasion is about territory, forms of governance, national ambitions, history and culture. Russia under Putin refuses to accept the idea of Ukraine as a nation. To do this, it must deny the existence of a separate Ukrainian nationality and culture. It has been working hard to destroy that culture as I discussed in an earlier blog post, to the point of shelling and destroying museums. How can Ukraine fight back? One way, clearly, is through military resistance. It has already bravely demonstrated that it can stand up to the Russian bear militarily. Another is to assert its nationality and its culture. And that is where copyright comes in.

Discussing protection of copyright may seem like focusing on a “first world problem” at a time when people are lacking the basic necessities of life and being denied basic security. Yet in the long run, Ukraine will surely prevail (within exactly which boundaries at this point we cannot say) and its culture, and the protection of that culture, will be an important element in preserving nationhood, the bond that binds people together. Thus copyright industries—publishing, music, film, art—are key tools in protecting and promoting the Ukrainian presence and spirit.

I will confess that until this dreadful war broke out, I had not spent a great deal of time thinking about Ukraine. My knowledge was scant. Even though I live in a country with 1.4 million people of Ukrainian descent, (the largest community outside Ukraine itself, and Russia), the situation in Ukraine (Orange revolution, Maidan demonstrations) and Ukraine’s heritage was not something that had influenced my life very much. Of course, I knew that many Ukrainians had settled in the prairies provinces as far back as the early 1900s and had made significant contributions to Canadian life. They range from the artist William Kurelek to Governor-General Ray Hnatyshyn to the “Great One”, Wayne Gretsky. But my knowledge of Ukraine as a country and of its culture was superficial (and still is), although I am learning.

I didn’t know much about Volodymyr Zelenskyy until he became the man of the hour, the leader who rose to the occasion to express the will and determination of the Ukrainian people. I had heard a bit about this man, the actor and comedian who played a president, and who then became a president. Watching Kvartal 95 Studio’s “Servant of the People” on Netflix provides some interesting insights into Ukrainian thinking—and humour. The series, shot between 2015 and 2019, conceived, produced and starred in by Zelenskyy, clearly carries a serious message cloaked in humour, satirizing Ukrainian life as it was before February 24, 2022. It is almost painful to watch today because the topics—poking fun at corruption, the Ukrainian military, the Russians and Putin himself—hit so close to home. It is the ultimate reality TV. It is hard to go from Zelenskyy as President Goloborodko in the series to Zelenskyy the embattled leader of Ukraine simply by switching from Netflix to the news. The reality is that the horror unfurling nightly on the news is not a show; its real. And there is nothing funny about it. Yet “Servant of the People” stands as a testament to the power of creative content. It is what propelled Zelenskyy to the real presidency and put him into the spotlight of history.

If audio-visual content is one expression of Ukrainian identity, a more traditional form is the printed book. Needless to say, Ukrainian publishers are facing major challenges from the war, from destruction of printing facilities to shortages of paper. As reported in Publishing Perspectives, the Ukrainian Publishers and Booksellers Association has just released its spring catalogue featuring titles in six categories (art, biography and autobiography, business and economics, comics and graphic novels, cooking and drama). The Association is encouraging foreign publishers to download the catalogue and consider buying rights for translation of Ukrainian works, “one of the few options available to financially support Ukrainian authors and publishers in this extremely tragic situation.” Another means of tangible support is the creation of non-resident fellowships to support Ukrainian scholars, as is being done by Harvard and other universities. The spread of Ukrainian literature also serves the purposes of propagating and strengthening Ukrainian culture, so that Ukrainian realities are expressed by native Ukrainian writers, not through the lens of Russian authors. But of course, nothing is simple. One of the best known contemporary Ukrainian novelists and current president of PEN Ukraine, Andrey Kurkov, writes in Russian! That fact makes him no less Ukrainian, but it is indicative of the complex web of history and ethnicity that prevails in today’s Ukraine.

Kurkov’s role with PEN Ukraine links him to the work of PEN International, the international NGO first established in Britain in the 1920s to promote intellectual co-operation among writers globally and to promote literature as a tool of mutual understanding. PEN has for many years taken on the role of advocating for writers and journalists who have been imprisoned or sanctioned for freely expressing their opinions. Not surprisingly, PEN has taken a particular interest in what is happening in Ukraine, Belarus and Russia in terms of attacks by the Putin regime on freedom of expression in all three countries. Any forms of dissent in Russia have had to go underground. In Ukraine, despite the war, publishing continues. A recent book launch by Vivat Publishing of a Ukrainian translation of an Adam Mansbach book for parents of sleepless children took place in an underground shelter in Kharkhiv, even as the city was under bombardment.

Books are making a contribution to Ukraine’s struggle in another way. A Canadian independent publisher in Calgary is reprinting a Ukrainian children’s book “The Little Book”, a reader originally produced in Ukrainian for the children of Ukrainian families on the prairies in the 1930s. The updated edition, called “The Little Book: Story Reader for a Free Ukraine”, is translated into English by Magda Stroinska, a professor of linguistics and languages at McMaster University in Hamilton, with an introduction by Lorene Shyba (yes, she is of Ukrainian descent), the publisher. The goal is to raise $10,000 for Ukrainian relief. The book, now presumed to be in the public domain (efforts to trace descendants of the author and illustrator Mykola Matwijczuk proved to be unsuccessful), is selling well. The printers donated their services and booksellers are donating the proceeds of sales.

While books are a basic expression of culture, so too is music. But I am not talking about traditional, folkloric music but the contemporary pop scene. Ukrainian pop groups received a shot in the arm after the Maidan “revolution” and Russia’s 2014 invasion of Crimea because until that time the music scene had been dominated by Russian groups. Russian artists who had backed the Crimean annexation were banned, opening up opportunities for young Ukrainian performers. The irony is that it was the heavy-handed Russian response that breathed fresh life into the contemporary Ukrainian music scene; instead of suppressing Ukrainian culture and national expression the end result was a de-emphasis on things Russian, and a displacement of Russian rock groups. For sure, right now most Ukrainian musicians are either holding guns rather than guitars or have gone underground, but Ukrainian pop has come into its own and will remain part of the nation’s cultural heritage. There is no better example of this than the Ukrainian band Kalush Orchestra who won the Eurovision Song Contest earlier this month with their moving song Stefania. Listen, and watch, here.

If culture is the expression of a nation, copyright is one of the essential tools that nourishes cultural expression. Ukraine, as an emerging democracy, has not typically enjoyed a strong tradition of copyright protection. In fact, in past years it has featured regularly on the “Priority Watch List” (PWL) of the US Trade Representative’s (USTR) annual Section 301 report. The PWL designates countries with “serious intellectual property rights deficiencies” in USTR’s judgement. This year, however, USTR gave a nod to the obvious.

In 2020 and again in 2021, Ukraine was put into the PWL category based on three long-standing issues: “(1) the unfair, non-transparent administration of the system for collective management organizations (CMOs) that are responsible for collecting and distributing royalties to right holders; (2) widespread use of unlicensed software by Ukrainian government agencies; and (3) failure to implement an effective means to combat widespread online copyright infringement.” This year’s report noted that over the past year Ukraine had engaged meaningfully with the United States on longstanding areas of concern with its intellectual property regime, although the problems identified in earlier years remained of concern. “However, due to Russia’s premeditated and unprovoked further invasion of Ukraine in February 2022, the Special 301 review of Ukraine has been suspended.”

The steps that Ukraine has taken toward establishing a more transparent and fairer system for collective management of royalties, including new legislation, the progress that is being made toward ensuring that government departments actually use licensed software in addition to being instructed to do so, and tightening enforcement over online copyright infringement are all issues that Ukraine can and no doubt will address in time, once the current crisis has been overcome. When the shape of the new Ukraine becomes clearer, national rebuilding can begin, including promoting and disseminating Ukrainian cultural expression both domestically and internationally. Cultural expression through the copyright industries is a national asset, one that needs to be nurtured and protected. Encouraging and protecting artists and creators is an essential tool of nation-building and national restoration. There is no better way to do that than to respect and protect their rights.

© Hugh Stephens, 2022. All Rights Reserved.

The Mickey Mouse Copyright Extension Myth: A Convenient “Straw Man” to Attack

The Walt Disney Company has delighted generations of children and adults with its style of wholesome family entertainment, whether it’s movies, cartoons, games or theme parks. That’s the Disney brand. Disney has generally managed to steer clear of political controversies and stay safely in the middle ground, very much in the mainstream. Like any global corporation, Disney needs to satisfy a range of stakeholders, the most important of whom are its customers, but also including, of course, shareholders, employees and regulatory authorities. Disney has managed to navigate these sometimes-conflicting demands pretty well. After all, it has successfully established theme parks in places as varied, in terms of political environment and regulatory expectations, as Paris, Tokyo, Hong Kong and Shanghai. Not to mention California and Orlando, FL. Actually, Florida might be the most challenging regulatory environment in which it operates.

At the current time, Disney is being targeted by some state and federal Republican officials because they feel Disney is not on-board with current Florida legislation, “The Parental Rights in Education Bill” (aka “Don’t Say Gay” bill). If adopted, it will prevent discussion of sexual orientation or gender identity instruction in Florida classrooms from kindergarten through Grade 3. Disney would no doubt prefer to avoid wading into a controversial issue like this unrelated to its business, but the unhappiness of some Disney employees over its initial low profile led to the company to take a corporate position—against the bill.

It is not my intention to step into the minefield of Florida, or gender identity, politics. Disney is more than capable of defending itself and explaining its corporate positions. Rather I want to highlight the ludicrous position taken by some Disney political critics to try to punish the company by attacking it on the basis of its copyright holdings. Two Republican members of Congress, Rep. Jim Banks of Indiana and Rep. Jim Jordan of Ohio have threatened to block any extension of Disney’s copyright on Mickey Mouse.

That might be a real threat or a punishment if Disney was actually seeking to extend the term of protection of US copyright law, which of course would apply to everyone, not just Disney. But there has been no suggestion that they are. Nor is anyone else trying to achieve this as far as I can tell. Banks has written to Disney’s CEO opposing any extension to Disney’s copyrights–extensions that Disney has not asked for. This must be the straw man of all straw men.

The latest development is that Senator Josh Hawley (R-MO), in a publicity stunt designed to “punish” Disney has introduced legislation, “The Copyright Clause Restoration Act” (S-4178), that would specifically target The Walt Disney Company by rolling back existing copyright protection on its works along with drastically shortening the term of copyright protection for all other rights-holders going forward. Apart from being an unconstitutional expropriation of property, the Bill would put the United States in violation of commitments made in a number of bilateral and multilateral trade agreements, notably the conditions of its accession to the Berne Convention. The retroactive and expropriatory element of the Bill is worded so that it applies to any entertainment company or movie studio with a market capitalization above $150 billion, without specifically naming Disney. Disney, however, is clearly the target as the only primarily content company with copyright assets covered by the designated industry classification categories named in the Bill—unless its market cap suddenly plummets. This is too cute by half. Hawley may as well have said that the legislation applies to any company that owns the IP in an anthropomorphic mouse that whistles. (It appears, however, that NBC Universal may also be captured because of its ownership by Comcast and Amazon’s just-concluded acquisition of MGM could also possibly subject the copyright holdings of this studio to retroactive expropriation–except that it won’t happen). Hawley’s draft legislation is bad law and terrible public policy. It will go nowhere because Congress is not going to change the law to target just one company and retroactively expropriate its assets just because one Senator happens not to like it. Apart from the legal challenges this would entail, the move reeks of political gamesmanship. In short, the whole thing is plain “Goofy”.  

Banks and Jordan, and now Hawley, have dredged up the issue as a stick with which to beat Disney because copyright protection on the first Mickey Mouse cartoon ever produced, Steamboat Willie, which came out in 1928, will expire in the US on January 1, 2024. On that date the first black and white sound cartoon in which a very different looking Mickey from the one today, a Mickey who whistles but does not speak, will fall into the public domain. But Disney will retain copyright over all iterations of Mickey beyond this early cinematographic work and furthermore holds trademark rights over all uses of Mickey on a full range of products and merchandise, in perpetuity as long as the marks are used and renewed. Not only that, this is not just about Mickey; the copyright on a lot of other works will also expire on the same day. This is a regular occurrence, a fact that anti-copyright crusaders try to exploit each year by proclaiming “Public Domain Day”. This is just a publicity stunt to promote an anti-copyright agenda, suggesting that works under copyright protection have been locked away from the public for decades, and are now suddenly liberated. This is nonsense. As I wrote earlier this year when A.A. Milne’s work “Winnie the Pooh” entered the public domain in the US (“Winnie the Pooh, the Public Domain and Winnie’s Canadian Connection”),;

Those who go to inordinate lengths to “celebrate” a work going into the public domain help feed the false narrative that a work under copyright is one that is “locked up” and unavailable to the public. The Center (for the Study of the Public Domain, at Duke University) notes that works falling into the public domain are “free for all to copy, share, and build upon”. That’s true, but a work under copyright is also available for all these purposes through licensing, and/or fair dealing/fair use exceptions.”

Milne’s work has been in the public domain in Canada since 2007, but I have yet to see an explosion of derivative works simply because Pooh is not in copyright there. In Canada, the term is life of the author plus 50 years although that is about to be extended to “life plus 70” to match the term for the EU, Australia, Japan and many other countries as well as for newer works in the United States. Because of the history of copyright legislation in the US, where there were different (renewable) terms at different times in the past, when Congress updated US copyright law in 1976 it provided a period of protection for older works of 75 years from the date of the publication of the work, rather than tying the term to the lifespan of the author. For works published after January 1, 1978, a term of “life plus 50” was legislated. In 1998, the “life plus 50” term was extended by twenty years to bring the US copyright term into alignment with that of the EU, whose term had become “life plus 70”. At the same time Congress also extended the period of 75 years from publication for older works by 20 years to 95 years.

At that time, Steamboat Willie’s 75 year copyright term was nearing expiration, leading to a campaign by those opposed to term extension to identify the US Copyright Term Extension Act of 1998 (aka the Sonny Bono Copyright Term Extension Act, named after Congressman Bono, who had recently died in a skiing accident), as the “Mickey Mouse Protection Act”. While unfair and misleading, the label was used to mobilize anti-copyright elements to try to paint the legislation as a gift to one company. Although Disney as a major copyright stakeholder actively promoted extension, as did many other companies, associations and groups with copyright interests, the main motivation for the US legislation was to enable US rights-holders to access the additional twenty years of copyright protection offered by the countries of the European Union. As copyright blogger and retired senior music industry executive Neil Turkewitz pointed out in a posting a couple of years ago, the US Supreme Court, in dismissing a challenge (Eldred v Ashcroft) against the term extension law stated;

By extending the baseline United States copyright term to life plus 70 years, Congress sought to ensure that American authors would receive the same copyright protection in Europe as their European counterparts.”

The EU has a provision known as “the rule of the shorter term” whereby EU member states will not provide the full “life plus 70” term of protection to authors from other countries unless EU rights-holders are given equivalent protection. In other words, the EU applies the principle of reciprocity to the extended term, as is its right under the Berne Convention. To avoid unfavourable discriminatory treatment against US rights-holders in the EU, the United States needed to provide the same level of protection to EU rights-holders as those rights-holders enjoyed in the EU by extending its term, a provision that would of course be applicable to domestic rights-holders as well.

Back in 1993 the EU implemented an extended term of “life plus 70” through its Copyright Directive–applicable to all members–primarily in order to harmonize the term of protection among member states, which were of varying lengths. For example, Germany had a term of “life plus 70” whereas Italy was “life plus 56” resulting in confusion about what works were protected by copyright within the Union. One of a number of stated reasons for extending the term of protection was that originally the “life plus 50” standard incorporated into the Berne Convention of 1886 was intended to protect works for two generations after the demise of the author. With longer life spans in the last decade of the 20th century, a period of 70 years was now required to provide the equivalent level of protection. This was one justification and there were others, but the prime motivation was to level up the level of protection across all the member states. While internal consistency was the major factor for the EU, the result was that other countries not meeting the EU standard would find their rights-holders at a disadvantage in the EU market.

Once it had extended its term across all member states, the EU adopted reciprocity (or the rule of the shorter term) to encourage other countries to give equivalent protection to EU rights-holders abroad. In the case of the US, it worked. When Congress passed the Term Extension Act in 1998, Disney was a beneficiary along with any other rights-holder whose work had not yet entered the public domain in the US. While some countries have longer terms of protection than the United States or the EU (Mexico for example has a term of copyright protection “life plus 100”—maybe people live longer in Mexico), there is no push in the US or EU for extending the present term of copyright (although there are some who argue that copyright is a property right and like other property rights should last in perpetuity). Today the focus is on encouraging those countries where the term of protection is only “life plus 50” (like Canada and New Zealand) to align their terms of protection with that of most other developed nations. Both countries have committed to doing so as a result of trade agreement commitments, a move that will have the additional benefit of securing longer protection for their rights-holders in the EU, just as American rights-holders benefited once Congress adopted the Copyright Term Extension Act in 1998.

Given the background to US copyright extension twenty-five years ago, and the current state of US copyright law, it is frankly laughable to suggest that a movement to further extend the term of copyright protection in the United States will suddenly emerge, driven by the Walt Disney Company or anyone else. If there is no such movement, there is no need to publicly oppose it. And it is equally ridiculous to try to take US copyright law back in time to the provisions of the Copyright Act of 1909, as Hawley’s bill would do. This is all about political grandstanding, but that grandstanding would have a lot more credibility if it was based on facts—and sound legal principles– rather than a myth.

© Hugh Stephens 2022. All Rights Reserved.  

The “Declaration for the Future of the Internet”: What Does it Mean for Copyright Industries?

On April 28, with little advance notice, an announcement was released by various governments informing the world that they had just signed a Declaration for the Future of the Internet”. In all, sixty-one countries signed this grandiose-sounding document, ranging from Albania to Uruguay. Signatories notably included the US, which was the sponsor of the Declaration, the 27 countries of the EU, the UK, Japan, Canada, Australia, New Zealand, and four of the five Nordic countries. These constitute what one might loosely consider the “western alliance”, but signatories also included several countries in Latin America, a couple of African states, Ukraine, Georgia, Moldova, Serbia, Israel and even Micronesia, Palau and the Marshall Islands. Notably absent were not only Russia and China, against whom the Declaration appears to be aimed, and a number of states where control of the internet is part of the control mechanisms exercised by those regimes (think Iran, Saudi Arabia, Syria, the Gulf States—in fact no government in the Middle East save Israel signed on), but also some states one would have thought might have joined, such as Norway, India, South Korea, Switzerland or any of the ASEAN states. Indeed, except for Japan and Taiwan, there were no signatories from Asia.

The Declaration has been percolating below the surface in Washington for a few months and was almost rushed into existence last December in the form of an “Alliance for the Future of the Internet”, associated with President Biden’s virtual “Summit for Democracy” held December 9-10. At the time there was strong pushback from various quarters, not the least because of a lack of public consultation with stakeholders plus a concern that it would lead to a splitting of the internet by creating at least two camps, those in the “Alliance” and those not. For example, one stipulation in earlier drafts was that signatories should only use equipment from “trustworthy suppliers”. (meaning, in effect, not from Huawei). In the end, the Alliance was not unveiled at the Summit as it was clearly not ready for prime time. Now, reworked, it has emerged as a non-binding declaration.

So what does it do, what does it not do, and what impact will it have on creators and the content industries who are, after all, major stakeholders when it comes to the internet and digital trade? First of all, while it sets out a number of broad principles considered to be desirable for the governance of the internet, it creates no obligations and has no implementation or enforcement mechanism. The principles are hard to argue with; indeed, they are generally laudable, although “freedom” always has to be balanced with responsibility, of which there is little mention. On its website, the US Department of State indicates that the key principles include commitments to;

  • “Protect human rights and fundamental freedoms of all people;
  • Promote a global Internet that advances the free flow of information;
  • Advance inclusive and affordable connectivity so that all people can benefit from the digital economy;
  • Promote trust in the global digital ecosystem, including through protection of privacy; and
  • Protect and strengthen the multi-stakeholder approach to governance that keeps the Internet running for the benefit of all.”

The EU’s interpretation of the Declaration adds “contestability of online platforms, and…fair competition among businesses.” By “contestability” (a strange word drawn from the Declaration itself) I assume the press release is referring to competition between online platforms. (An astute reader has clarified the term contestability for me–see below). Canada proclaimed that the Declaration expresses its objectives for an internet that is “open, trusted, interoperable and secure” that “fosters democratic values and respect for human rights.” The phrase “open, free, global, interoperable, reliable, and secure” is a kind of buzzword that appears repeatedly throughout the document. I am sure that other signatories also issued their own statements interpreting the significance of the Declaration. In fact, it is so broad that just about everyone can find something in it to support, except perhaps the countries against whom it is primarily aimed, notably Russia and China. This statement, for example, is surely aimed at Russian political interference in the last US presidential election.

Signatories agree to;

Refrain from using the Internet to undermine the electoral infrastructure, elections and political processes, including through covert information manipulation campaigns.”

Likewise, against whom other than China could this commitment be directed?

Signatories agree to;

Refrain from misusing or abusing the Internet or algorithmic tools or techniques for unlawful surveillance, oppression, and repression that do not align with international human rights principles, including developing social score cards or other mechanisms of domestic social control or pre-crime detention and arrest.”

The Declaration even enlists the internet in the fight against global climate change.

That is what it does. What it does not do is directly address the important issue of platform accountability although there is a tangential reference to the fact that “the once decentralized Internet economy has become highly concentrated and many people have legitimate concerns about their privacy and the quantity and security of personal data collected and stored online. Online platforms have enabled an increase in the spread of illegal or harmful content that can threaten the safety of individuals and contribute to radicalization and violence.” “Freedom of expression” and the “free flow of information” are not absolutes even in the most democratic of societies. Reasonable limits to curb defamation, online bullying, hate speech, incitement of violence and other abuses, including disinformation and misinformation are also part of the democratic social contract, but the Declaration just skips over these nuances in laying out its principles. I realize it can be a fine line between legal constraints in a democratic society and the abuse of these constraints by autocratic regimes, but it is not impossible to find language that conveys these distinctions.

Fortunately, what the Declaration also does not do is include any reference to Section 230-like language, such as was included in the US-Japan Digital Trade Agreement or the new NAFTA (USMCA). These agreements tried to immunize platforms from civil liability for content hosted (and sometimes promoted by them) on their platforms by including terminology that required an interactive computer service (i.e. digital platform) to not be treated as an information content provider in determining liability for harms. In other words, platforms could duck any responsibility for third-party content they carry and promote. (Both Canada and Japan did an end-run around this provision by inserting a caveat that allowed them to implement this commitment through existing legal doctrines applied through judicial decisions, thus preserving secondary liability.)

While the lack of any reference to platform immunity is a positive, unfortunately the Declaration also fails to pro-actively affirm the rights of creators in the digital realm, and contains some language that could be considered problematic from the perspective of copyright-holders. The internet has proven to be both a boon as well as a major challenge to copyright industries and creators. While there is lip service to creators in the document, with the Declaration noting that the internet brings new audiences to artists and creators, it then goes on to talk about “unfettered” access to knowledge for “everyone”. I am not sure of the intent of this wording, but it could be misused by anti-copyright elements to oppose legitimate licensing requirements for access to copyrighted content.

Another concern arises in the section of the Declaration dealing with “A Global Internet”, where there is a reference to net neutrality that needs to be carefully interpreted.

Signatories should;

Refrain from blocking or degrading access to lawful content, services, and applications on the Internet, consistent with principles of Net Neutrality subject to applicable law, including international human rights law.”

Again, there is a risk that this language could be misused by opponents of site blocking or other measures taken to combat digital piracy and unauthorized transmissions. Net neutrality has been trotted out in the past by anti-copyright elements as a reason to oppose site blocking. However, I take some comfort in inclusion of the adjective “lawful” in the commitment. Site blocking as a means to fight online piracy has been instituted in a number of countries that are signatory to the Declaration. This is done either through a judicial or quasi-judicial process or a transparent administrative mechanism, and has no impact on transmission of lawful content, nor does it interfere with net neutrality.

Finally, there is one other reference in the Declaration that may provide some comfort to digital content producers. It references malware and scams, often distributed through pirated content.

Signatories will:

“Promote the protection of consumers, in particular vulnerable consumers, from online scams and other unfair practices online and from dangerous and unsafe products sold online”

Many of these scam artists access consumers, including vulnerable consumers, through Trojan Horses inserted into pirated content, as I wrote about a few years ago. (“The Year of the RAT-Beware”). Legitimate content is the antidote.

At the end of the day, there are some scraps in this document for creators, but not many. It is clear that there was little consultation with a group that is among the prime users of the internet and is a prime stakeholder in its governance. As a statement of general principles, the Declaration is unlikely to do much harm, or frankly, much good. No-one can argue with basic human rights, freedom of expression—within reasonable limits, protection of privacy, and equality of access to the internet. How these lofty goals will be achieved in practice is another question.

It would have been preferable to have had a more inclusive document that better reflected the interests of stakeholders, including the content industries, but the intent seemed to be to get a statement of principles “out there” as quickly as possible. With no concrete action plan or any firm commitments attached to it, it may simply be a bit of window-dressing that is easy for countries to commit to, an internet “vision statement” as it were. It is too bad that vision did not include more specific references to the interests of the creators and content industries that produce the digital content that makes the internet the “go to” forum for most of the world’s connected population.

© Hugh Stephens, 2022. All Rights Reserved.

This blog has been updated to clarify the meaning of the term “contestability” in the 4th paragraph. With thanks to Simon Carne.

The Anti-Copyright Hyperbole Fails to Sway the Canadian Government

Credit: Author

Call it a victory for common sense. The Canadian Budget Implementation Bill, which includes needed amendments to the Copyright Act to implement Canada’s CUSMA treaty commitment to extend its term of copyright protection to bring it into alignment with its major trading partners, has now been tabled. The legislation takes the sensible and straightforward approach of amending the duration of copyright protection in Canada from life of the author plus 50 years (“life plus 50”) to “life plus 70” without the interposition of new and burdensome registration requirements called for by copyright opponents. The new term will apply to all works under copyright at the time of proclamation of the legislation which, according to the terms of the CUSMA, must take place before the end of 2022.

In the lead up to the tabling of the bill, we have been inundated with tendentious and misleading information from many of the usual suspects about the supposed harm of extending Canada’s duration of copyright protection. The anti-copyright hyberbole machine has been in overdrive. As much as I am tempted to ignore this flood of verbiage since the sensible decision has now been taken by the government—and lest I give the attacks on copyright greater credibility that they deserve– I cannot resist the opportunity to present an alternate view.

Recall that in the CUSMA (aka the USMCA), the new NAFTA 2.0 agreement that went into effect on July 1, 2020 Canada agreed, as part of the overall CUSMA package, to extend its term of copyright protection to “life plus 70”, the same term that is in effect in the United States, the EU, the UK, Japan, Australia—more than 80 countries around the world. It is a revision to the “life plus 50” minimum established by the major international copyright treaty, the Berne Convention, to which both Canada and the US belong. Canada agreed to take this action no later than 2.5 years from the entry into force of CUSMA, which was July 1, 2020. There is thus a degree of urgency to get this piece of legislative homework completed before the end of the year, which no doubt explains why the necessary Copyright Act amendments have been appended to the 2022 omnibus budget bill. The budget must pass or the government will fall, and with the “confidence and supply” agreement signed between the NDP and the Liberals, it is virtually guaranteed that the budget implementation bill will be approved by Parliament. The Copyright Act amendments will go along for the ride.

So, if copyright term extension is going to happen, why all the fuss? University of Ottawa law professor Michael Geist has been leading a campaign to try to convince the government to insert a major road-bump in the way of copyright extension implementation. He has advocated for the imposition of a copyright renewal registration requirement once the initial term of “life plus 50” expires, a move that no other country has ever undertaken. And for good reason. To require rights-holders to register their copyright in order to access the full term of protection to which they are entitled would mean establishing a bureaucratic process for registration and maintaining a registry of copyright renewal, putting the onus on users to try to determine if a work had been renewed (and was still protected by copyright) or not. It would also put a burden on rights-holders to renew within the short window when the Berne Convention minimum term of “life plus 50” approaches expiration. It is a “really bad idea” as I wrote a couple of weeks ago. No doubt major corporations would have the resources to do this, but many individual rights-holders (such as the estates of deceased authors) would likely fail to take the requisite action in the required time-window.

Apart from the regulatory burden, it is very likely that imposition of a registration requirement would be a violation of Canada’s commitments under the Berne Convention. It is a cardinal principle of Berne, dating back to the original iteration of the Convention in 1886, that copyright be conferred without any formalities of registration provided that a work meets other requirements establishing copyright. To try to convince the government to take a counter-intuitive action by instituting a copyright renewal registration requirement that would not only contravene Berne, but which would result in making it as difficult as possible for rights-holders to access the benefits of a provision agreed to in a bilateral trade treaty, Prof. Geist has trotted out arguments old and new against term extension.  

In one recent blog, we are given lists of public figures whose works will remain under copyright protection for an additional twenty years when the extension goes through. “Historians will lose public domain access to the works and papers some of Canada’s most notable leaders and figures of modern times, including leading Prime Ministers, Premiers, First Nations leaders, and Supreme Court justices,” he says. He rightly notes that these people (the list includes Joey Smallwood, John Diefenbaker, Tommy Douglas and a number of others), helped shape a nation. All true. But then he adds, “To withhold their works from the public domain for decades represents an enormous collective loss to our culture and heritage.”

What? Haven’t their papers been available to researchers for years? Haven’t multiple books and studies been written about these personalities? I did a quick internet search on just Smallwood and Diefenbaker and came up with more than a dozen works on each, including autobiographies. Has the fact that their writings have been subject to copyright protection prevented research and publication of subsequent works about their careers? It doesn’t seem so. The entire argument is based on the false premise that a work not in the public domain is a work not accessible to researchers, the public, libraries or anyone else. In fact, the existence of copyright provides the incentive to produce the works in the first place, and in many instances to incentivize reprints. Geist propounds the same fallacious argument with respect to Canadian authors. He provides a list of “Canadian authors and scholars whose work will be lost for a generation”. This list includes Margaret Lawrence, Marshall McLuhan, Northrop Frye, Gabrielle Roy and so on. How will their works “be lost”? I am scratching my head.

The only parties to whom these works will be “lost” will be the republishers, publication houses that specialize in printing public domain works. One such entity is Broadview Press, quoted by Dr. Geist in one of his blogs, and a consistent opponent of extending the term of copyright protection in Canada. Why? Because Broadview has made a business of reprinting books that are still under copyright protection in other countries, such as its Canadian edition of the Great Gatsby, and selling them in Canada in competition with “authorized” editions. There is nothing wrong with that but let’s be clear as to motivations. I wrote about Broadview’s opposition to copyright term extension back in 2020. Copyright Term Extension in Canada and the Interesting Case of Broadview Press: Is it “Playing the Victim” or Just “Playing the Game”? Because Canada has a shorter term of protection, F. Scott Fitzgerald’s work fell into the public domain in Canada before it did in the US. Broadview either did not want to pay for the rights to reproduce the work, or perhaps was not able to licence the work from the Fitzgerald estate, and so it produced its own Canadian edition in 2007. (This edition was copyrighted, by the way, in the name of its editor, Michael Nowlin). This edition could not be sold in the United States until Fitzgerald’s works entered the public domain in that country on January 1, 2021.

I will concede that an extended term of copyright protection does not favour the business model of publishing houses that specialize in printing well known works once they enter the public domain, but I would argue that this does no harm to the public interest. Public domain works are in many cases no cheaper than comparable works still under copyright protection. While publishers of public domain works don’t have to acquire the rights to reprint a work, that doesn’t mean that they don’t have costs to cover. What is not paid to license a work can be added to their margin, as long as the book price remains reasonably competitive. The return provided to a rights-holder by copyright protection is just as likely to incentivize the printing of new editions as the free ride for some publishers from a book entering the public domain.

Numerous studies have been conducted on the impact of copyright term extension on public welfare. At best, the results are inconclusive. Dr. Geist has repeatedly quoted a report published in New Zealand in 2009 that purported to show that if New Zealand extended its term of protection by an additional twenty years, it would cost the New Zealand economy NZ$55million annually in lost economic welfare as royalties were sent out of the country as payments to foreign rights-holders. However, that report was based on erroneous calculations and has been convincingly debunked. It should be buried once and for all. The economist who reviewed the faulty study done for the New Zealand Ministry of Foreign Affairs and Trade (the study is no longer available on the MFAT website) concluded that rather than a net welfare loss, the New Zealand economy could gain by as much as NZ$150 million per year if its term was extended. Extending copyright in Canada will bring extra protection, and revenue, for Canadian rights-holders from sales of their works abroad.

Moreover, models that focus exclusively on consumer costs ignore the economic benefits to creators and the overall beneficial impact on the economy. For example, a study Michael Geist likes to quote is a 2013 paper produced by Professor Paul Heald, an economist at the University of Illinois. Geist says that Heald concludes that copyright term extension is a “tax on consumers”. I actually read Heald’s paper and could not find that reference. However, Heald does talk about the retail price of books and concludes that in some instances (i.e. “the top twenty most popular public domain and copyrighted books from 1912-32 under several different measures”), books in the public domain are cheaper than books covered by copyright. But he also says, and I quote, “Buccafusco and Heald (2013) also found that the overall price of thousands of copyrighted and public domain books in a random sample of new Amazon books were the same… In summary, much empirical work remains to be done to test various claims about the costs and benefits of a work falling into the public domain.”

I may be cherry-picking (and I am not the only one!) but this is hardly conclusive evidence that term extension is a tax on consumers. Even if some books that are copyright protected have a higher retail price, this does not mean that this is an unfair “tax” on consumers. The added cost presumably represents the royalty paid to the author. The lowest price is not necessarily the optimal price from the perspective of the economy. I have used the example of recycling fees to make this point. A product in a container attracting no recycling fee would be cheaper for the consumer than a product in a recyclable container. But is the lowest price the optimal price? The recycling fee is not a tax and has a defined purpose. The same principle applies to the royalties or licence fees paid to authors and rights-holders for copyrighted works.

So where does all this leave us? He said, she said? Maybe. But what it proves to me is that there is an academic debate about the impact of the public domain on costs and availability of works. Different studies have produced different results. However, to suggest that works not falling immediately into the public domain will be “lost for a generation” is, as the British would say, “bollocks”. The “sky is falling” hyperbole about taxing consumers and locking away works just doesn’t stand up to the light of day. This misinformation was trundled out to try to convince the Canadian government to impose an irrational and unworkable registration requirement when implementing its copyright extension commitment. It didn’t work. In a final frenzied blog post published after the contents of the Copyright Act amendments were made public, Dr. Geist says “Make no mistake: the decision to implement copyright term extension without mitigation measures is the government’s choice.” He is right. Canada is fortunate that the Government of Canada made the commonsense choice of bringing its term of copyright protection into line with that of its major trading partners by simply extending the term, as everyone else to date has done.

© Hugh Stephens 2022. All Rights Reserved.

World IP Day: IP and Youth-Innovating for a Better Future (Kidovate as an Example)

Photo Credit: Brock Smith

This year the theme of World Intellectual Property (IP) Day, April 26, is “IP and Youth: Innovating for a Better Future”. As the World Intellectual Property Organization (WIPO) puts it;

“Across the globe, young people are stepping up to innovation challenges, using their energy and ingenuity, their curiosity and creativity to steer a course towards a better future.”

How true. Creativity can come at any age. The New England Journal of Medicine has recently published a study showing that peak human intellectual activity occurs around the age of 70 when the brain begins to function at full strength, because at this age the interaction of the right and left hemispheres of the brain becomes harmonious, expanding creative possibilities. That’s good to know and perhaps helps explain why so many seniors take up new crafts, make music, learn to play musical instruments, write books, and become artists in later life. But at the same time, the creativity of youth has amazing potential.

This was brought home to me in spades by an event mounted by and for young entrepreneurs (and I mean young, between the ages of 9 and 14—middle school and junior high school students) a couple of weeks ago close to home, Victoria BC, sponsored by the Gustavson School of Business at the University of Victoria (UVic). The idea is not unique to Victoria or UVic. Since 2007 the Acton Academies, based in Austin, TX, have been organizing Children’s Business Fairs. Acton Academies now exist around the world. According to the Children’s Business Fair website, over 1000 events involving over 50,000 young entrepreneurs have been held in 341 cities in 16 different countries. It sounds like a great program. If interested, you can get more information on their website to organize a children’s business fair in your own community.

I am sure that the creative output in these events around the world matches the imagination and innovation that I observed at UVic’s young entrepreneurs’ fair, called Kidovate. According to the Victoria Times Colonist, Kidovate was launched in 2019 to introduce young people to the basics of being an entrepreneur. Students follow a graphic workbook created by UVic entrepreneurship professor Brock Smith that provides a step-by-step guide on how to set up a venture. If they wish, the students can arrange for a student mentor from the School of Business. Dr. Smith told me that UVic has even prepared a teaching module integrated with the Department of Education curriculum that middle and high school teachers can use to engage their students. Students learn about pricing, financing, marketing, customer service, record-keeping, innovation and regulation. Kidovate helps the young entrepreneurs obtain one day business licenses from the City for Kidovate Market Day (the $100 registration fee is waived). Students themselves merchandise their products, organize business cards and signage, and in some cases will take orders for later delivery.

But what about innovation and creativity? There was lots of it on display. My first stop was a stand operated by Mulita, age 13 and her friend Lily. She was selling keychains, fridge magnets, and pins (including Ukrainian flag pins) made from modular plastic pieces glued together. I asked her where the design ideas came from. “We make these things together with our friends, and we draw and think up the designs ourselves” she replied. Original art!

Next door was Abba, aged 11, selling similar products made of baker’s dough, then painted in bright colours. She too created her own designs.

Phyfer, aged 13 and Zane, 12, had produced 3D printed sea creatures and other animals in moulded plastic, which they then decorated, assisted by design software they had programmed themselves. (As I wrote recently, machine assisted creativity is still a human creation, qualifying for copyright protection.) On and on it went; macrame, jewellery, gift cards, tie-dye, wood carvings, hand-made soaps—all (or most) from original designs. I bought a couple of cut-out gift cards, which could be customized with a personalized greeting; an orca in the background (lots of them along the BC coast) framed by the cut-out. I think the creator of these cards was the one who told me that she was “Nine years old” but then hastened to add, “…but I’m almost ten!”.

A nice touch was the fact that a portion of the proceeds would be going to various charities, the Canadian Red Cross, Ukrainian relief, a Homeless Shelter. It was a very impressive small business showcase cum arts and crafts market; the artists were definitely keen, very articulate and clearly motivated. There were 70 stands with 90 participants. Next year Prof. Smith said he hopes to have 200 stands and 300 participating. And when I suggested that he add an IP component to his teaching module, he readily agreed. We all know (or should know) that IP is a valuable business asset.

Innovation and IP cover more than copyright and design of course. The WIPO website highlights several interesting inventions created by young innovators (young defined as below the age of 35). I have no doubt that some of the teens and pre-teens that I met at Kidovate will be making their own contributions to creation and innovation as they grow into adults. They are already off to a good start.

© Hugh Stephens 2022. All Rights Reserved

Copyright References in the Budget: Good Intentions Are Welcome but Early Action is Needed

Source: http://www.shutterstock.com

Last week I discussed the copyright needle buried in the 2022 Canadian budget haystack, a reference to impending legislation to amend the Copyright Act to fulfill Canada’s obligation under the USMCA/CUSMA to extend its term of copyright protection from the life of the author plus 50 years to “life plus 70”. The amendments will be tacked on as part of the 2022 Budget Implementation Bill along with a number of other measures unrelated to the budget. The only remaining question on term extension is whether the government will do the right and sensible thing and simply automatically extend the term of protection going forward (normally there is no retroactive extension for works that have already fallen into the public domain, even if that just happened) or whether they will listen to the lobbying from anti-copyright voices who are proposing that Canada institute a barrier to automatic extension by requiring rights-holders to renew their copyright through a registration process in order to access the additional period of protection. As I explained in last week’s blog, it would be a major mistake for the government to do this, creating an unnecessary bureaucracy, causing confusion and increasing complexity for users who will have to research whether copyright has been extended on a work, and likely being inconsistent with Canada’s international obligations under the Berne Convention.

But in addition to stating that copyright extension amendments will be included in the forthcoming budget bill, the budget document also added the following;

“The government is committed to ensuring that the Copyright Act protects all creators and copyright holders. As such, the government will also work to ensure a sustainable education publishing industry including fair remuneration for creators and copyright holders, as well as a modern and innovative marketplace that can efficiently serve copyright users.”

Why was this in the budget? Does it signal that there will also be legislation to restore some balance to use of unlicensed commercially published educational content by educational users? That would be welcome and long overdue. To achieve this, the overly-broad educational fair dealing exception introduced in 2012 needs to be amended and made more precise.

And what does “a modern and innovative marketplace that can efficiently serve copyright users” look like? Could it be that we will have a return to collective licensing of educational content after the disastrous Supreme Court of Canada decision last year that pulled the foundation out from under Canada’s collective licensing system for educational materials? (The Supreme Court upheld the Federal Court of Appeals decision that “mandatory tariffs” were mandatory only for providers of educational materials, not for users such as colleges and universities.) If this is the case, these are probably not measures that would be slipped into a budget implementation omnibus bill, although I suppose it is always possible. After all, there has already been extensive consultation on the fair dealing question. But if legislation to fix the educational publishing crisis is not being brought forth now as part of budget implementation, why then the reference in the budget?

It is likely to send a signal to publishers and authors that relief is coming (hopefully soon) even though it won’t be as part of the copyright extension process. Publishers, authors and their collective society, Access Copyright, have been looking for an opportunity to propose amendments to the Act to address problems with the definition of educational fair dealing and to fix the mandatory tariff issue. Because the Copyright Act has to be amended before the end of 2022 to deal with term extension, (according to the terms of the CUSMA agreement), this seemed to provide an opportunity to deal with these other pressing copyright issues. The budget reference therefore is a recognition that something needs to be done and a signal that fixing the problems is high on the government’s agenda. A sign of good faith intentions if you will. Given the “confidence and supply” agreement reached with the New Democrats, the Trudeau government now has some headroom and the ability to get legislation passed since it can expect to govern until the statutory date of the next general election in 2025.  

Inclusion of references to “a sustainable educational publishing industry” in the budget should mean that the government is finally ready to move forward to repair the damage caused by opening the fair dealing floodgates in 2012. There has already been extensive consultation, two Parliamentary committees have reviewed the issue and have recognized the problem, and a lengthy court process upholding findings of unfairness by York University, as a proxy for the post-secondary sector, has been completed. Although the educational sector will fight tooth and nail to leave things as they are and continue their free ride at the expense of the creators of educational content, it is time to move from consultation to action. After a decade of litigation and consultation, remedial action is required if Canada is to maintain a viable educational publishing sector so that Canadian students can continue to benefit from the creation of culturally-relevant educational materials. The impact on the publishing sector has been devastating; jobs in the book industry declined by over 30% between 2012 and 2019, the education sector has deprived Canadian creators and publishers of approximately $190 million in unpaid royalties under tariffs certified by the Copyright Board, and a number of publishers have exited the education market.

The fix to fair dealing is relatively straightforward. It needs to be narrowed so that the education fair dealing exception applies only when a work is not commercially available, as per the recommendation of the Standing Committee on Heritage in 2019. This would avoid the current college and university practice of reproducing works, piece by piece, supposedly to enable students to exercise their individual fair dealing rights, with the result often being that the entire work, or most of it, is made available to students in course packs all under guise of fair dealing and with no license or payment to the rights-holder. This will require a change to the legislation.

So too will clarifying the role of the Copyright Board of Canada in setting “tariffs” (licence fees) for use of materials in the repertoire of a collective society such as Access Copyright. This is a complicated issue, made more complicated by the finding of the Federal Court of Appeal (FCA), recently upheld by the Supreme Court. Until these court decisions, the practice and understanding had been that payment for use of any materials subject to a Copyright Board tariff decision became mandatory on all users if they reproduced covered content without obtaining a license.

However, based on its reading of the history of the legislation the FCA, upheld on appeal by the Supreme Court, ruled that the tariff is mandatory only when applied to a user. In other words, a rights-holder cannot withhold a licence to reproduce material if that material is subject to a tariff established by the Copyright Board, assuming the user agrees to pay the tariff. But the reverse (imposing a requirement to pay on a user who reproduces material covered by a tariff without obtaining a licence) is not mandatory. Instead, a rights-holder would have to bring an infringement action against the user. This decision undermined the system of collective licensing for educational works established some 30 years ago to avoid the necessity for individual users and institutions to have to negotiate licences with individual rights-holders, or for individual rights-holders to have to resort to litigation against individual users each time there was an alleged infringement. It was a system that worked for both authors and users, until it began to break down about a decade ago over licence negotiations. When the collective and users could not agree on a licensing agreement, the Copyright Board stepped in to establish fair remuneration based on estimates of the amount of copying engaged in by user institutions. Once a tariff was established, it was considered binding on all users if they accessed any of the repertoire covered by the tariff. And now a key pillar of that system has been removed by the courts.

It is not clear whether the promise in the budget document to bring about a “modern and innovative marketplace” to “efficiently serve copyright users” is a reference to the reinstitution of a viable collective licensing regime, probably in parallel with a review of the mandate and procedures of the Copyright Board. Hopefully that is what it means. A collective licensing regime is by far the most efficient means to serve users.

When the Copyright Act was last reviewed and overhauled in 2012, the intention was that this would be a process conducted every five years. That period has now doubled, although in the interim there have been consultation papers issued on various aspects of copyright (AI, Internet of Things, Data Mining, Orphan works, etc.), and a review by two Parliamentary committees which brought forth numerous recommendations. All this to prepare for Copyright Act updating. Despite the preparatory work, this will take time. Some of these issues, like the ones mentioned in the budget, should be fast-tracked and acted on now.

If the statement in the budget was a down-payment of sorts, a statement of good intentions, that is all well and good. But we all know that a road paved with good intentions, but no action, leads to only one place. And that is a hell of a place to be. The government should act on its commitments laid out in the budget and convert those intentions into legislation as quickly as possible. Other potential changes coming out of the much-needed and long-overdue review of the Copyright Act should also be put in motion so that a full overhaul of the Act can be completed before the next election. 

© Hugh Stephens 2022. All Rights Reserved

The Copyright Needle in the Budget Haystack (And Why Requiring Registration for Copyright Extension is a Really Bad Idea)

There it was! The copyright needle in the budget haystack. As plain as day–buried on p. 274 of Canadian Finance Minister Chrystia Freeland’s 280 page 2022 budget under “Other Legislative Measures” along with a grab-bag of about 40 other measures.  These ranged from legislation to enable Canada’s participation in the Lunar Gateway, to Criminal Code amendments to ban the communication of statements, other than in private conversation, that willfully promote antisemitism by condoning, denying or downplaying the Holocaust, to dealing with clean drinking water and better infrastructure for First Nations communities by repealing the Safe Drinking Water for First Nations Act (?), and so on. Almost four dozen unrelated ornaments hung on the budget Christmas tree. Item number 5 was labelled “Amendments to the Copyright Act”.

Why would an amendment to the Copyright Act be buried in the budget (along with the other assorted seemingly random legislative measures)? Because it’s a convenient way to pass legislation, that’s why. You scoop up all the legislative loose ends and you append them to the budget bill, and if the budget passes, and it will, the other attached pieces of legislation pass as well. Given that the Liberal government is in a minority situation, yet has just signed a “confidence and supply agreement” with the opposition New Democratic Party (NDP) by which the New Democrats will support the government in confidence votes for the next three years provided that the Liberals add some social programs advocated for by the NDP, like a dental plan and a pharmacare plan, to their “to do” list, then bundling loose ends and even some potentially controversial legislative items into a budget bill is a good way of ensuring that these legislative amendments become law with as little fuss and scrutiny as possible.

This is also a well-known tactic in the US Congress where unrelated pieces of legislation get attached to “must-pass” money bills on a regular basis. That is how the CASE Act, a worthy piece of legislation that had been blocked by just one Senator, was passed, as I wrote last year (“Making Sausage: How the CASE Act Finally Became Law”). That legislation created a Copyright Claims Board within the US Copyright Office, a sort of “small claims court” for copyright infringements. The CASE Act will help small creators bring infringement claims without having to resort to expensive litigation but had been blocked by Sen. Rod Wyden of Oregon. However, it was added to the 5,593 page, $1.4 trillion Consolidated Appropriations Bill, 2021 that funded the COVID relief program and kept the US government functioning. When that Bill finally passed the US Congress, so did the CASE Act, and it is now part of the law of the land. So good things can happen from using this procedure. Sometimes you just “gotta do what you gotta do”.

But back to the Canadian budget, introduced on April 7. With regard to amendments to the Copyright Act that are to be incorporated into the Budget Implementation Bill when it is introduced, (probably in May), the budget document had this to say;

In Budget 2022, the government proposes to introduce amendments to the Copyright Act to extend the general term of copyright protection from 50 to 70 years after the life of the author as agreed under the Canada-United States-Mexico Agreement.

The government is committed to ensuring that the Copyright Act protects all creators and copyright holders. As such, the government will also work to ensure a sustainable educational publishing industry, including fair remuneration for creators and copyright holders, as well as a modern and innovative marketplace that can efficiently serve copyright users.”

Let’s unpack the first part of this statement. There are two elements–what has to happen, and what some anti-copyright elements hope will happen. Extending the term of copyright protection is required to implement Canadian commitments made during the renegotiation of NAFTA, culminating in the NAFTA 2.0 agreement, known as the USMCA (or CUSMA in Canada). While it is a given that this will happen, it is still not completely clear as to how it will be implemented. According to Article 20.89.4 (c) of the USMCA/CUSMA, Canada has 2.5 years from the date of entry into force of the USMCA/CUSMA, which was July 1, 2020, to implement the provision. In other words, it needs to be enacted into legislation by the end of 2022.

Some opponents of term extension, notably University of Ottawa law professor and prolific blogger Michael Geist, have argued that even though Canada has a legal obligation to extend its copyright term, it can do so by instituting a registration requirement for rights-holders if they want to benefit from the added period of protection. In effect this proposal, which was picked up by one of two Parliamentary committees that reviewed the Copyright Act back in 2019, would impose an additional registration process (copyright renewal) on a rights-holder as a condition for gaining access to the additional 20 years of protection. It would put in place a gateway, a hurdle, an additional bureaucratic barrier if you will, as part of Canada’s implementation of its commitment. The objective is to make it more difficult for rights-holders in Canada to access the same degree of protection enjoyed by rights-holders in similar circumstances in the US, EU, UK, Australia, Japan and many other countries. In other words, for those who oppose extending Canada’s copyright term, they grudgingly concede that extension will happen but their intent seems to be to make it as difficult as possible for rights-holders to take advantage of it.

Imposing a copyright renewal registration requirement is an exceedingly bad idea, and one that was not endorsed by the other Parliamentary Committee (the Heritage Committee) that also undertook copyright review. It would impose an additional and unnecessary burden on rights-holders to be able to access the full term of protection they are entitled to for their works but worse, it would create uncertainty and cause confusion for users who would find it difficult, costly and time-consuming to verify whether or not a work fell under the “life plus 50” (life of the author plus 50 years) or the new “life plus 70” term. There is plenty of evidence to demonstrate the downsides of a copyright renewal scheme, using the example of what happened in the United States.

For many years, determining whether or not a work was still protected by copyright in the US was an unnecessarily complex and difficult task owing to the existence of a renewal requirement in US law. And for older works it remains complicated. Under the 1909 US Copyright Act, works copyrighted in the United States prior to January 1, 1978, were originally subject to two consecutive copyright terms, each of 28 years duration. The first term was granted upon registration of copyright, but the second term required an additional registration and renewal after the expiration of the first 28 year term. After the Act was modified in 1976, the second renewal period was upped to 47 years, for a total term of protection of 75 years, assuming renewal was applied for.

A problem was that many rights-holders neglected to renew their copyright. (Anti copyright advocates would no doubt say this was a good thing, but it complicated matters for users who found it difficult to determine if a work was in the public domain or still protected). Failure to renew applied not just to authors of books, but also to rights-holders for movies and other creative works. There are examples of where some of the rights in a movie were renewed, e.g. the screenplay, whereas other elements were not, leading to more confusion. Apart from the injustice occurring from an inadvertent oversight in complying with a somewhat arcane law that deprived a rights-holder (which could be the estate or heirs of the original author) of the economic benefits of copyright, users found it difficult to determine whether a work was still covered. To know for certain whether a work had been renewed, and therefore was still protected by copyright, a user has to search the Catalogue of Copyright Entries maintained by the US Copyright Office.

A good example of the problems caused by imposition of a copyright renewal requirement is illustrated by the FAQ answers provided by this online library website in the US in response to the question, “How can I tell whether a copyright was renewed?”;

One easy way to check, sometimes, is just to see if there was any edition published more than 28 years after the original edition, and see if there’s a renewal notice in that newer edition. This doesn’t always work– a lot of books simply don’t get reprinted– but if there is such an edition, it can be an easy check to make.

Another way that doesn’t involve an exhaustive copyright record search is to write to the author, or their agent or estate, or to the last publisher of the book, and see if they can tell you whether the book’s copyright was renewed…It’s also possible to do a search yourself of the copyright records. For 1978 onward, they’re online at the Copyright Office…

Copyright records prior to 1978 can also be found in print and microform at the Library of Congress, and at other major libraries around the country, including many Federal Depository Libraries…Since a copyright renewal has to be sometime in the 28th year, you’d look for renewals in the records for the original copyright date plus 27 years and the original date plus 28 years. So if the copyright was originally 1941, you’d look at the volumes for 1968 and 1969 to see if there was a renewal…

You can also arrange for the Copyright Office to do the search for you. There’s a form you can fill out and send to them, and they’ll eventually let you know if they find any renewal records, and if so, what they say. This has gotten rather expensive as of late; as of October 2019, the fees amount to $200 per hour (with a 2-hour minimum) for them to search their files for you…”

Simple, eh? This costly and unnecessary step, requiring an additional bureaucracy, is what will happen if Canada unwisely adopts a copyright renewal requirement as part of the process of extending its copyright term. No other country, to my knowledge, has ever imposed such a barrier when it extended its term of protection. (More than 80 countries worldwide have “life plus 70” as their term, another good reason for Canada to join the majority of its trading partners and harmonize its copyright term with theirs, benefiting Canadian creators in the process). As for the US, given the problems presented by copyright renewal, it abolished this system in 1992 when it passed the Copyright Amendments Act, making renewal automatic. The renewal system was messy and complicated as you can see by this US Copyright Office interpretive bulletin. Today in the United States, (indeed for all works created since 1978) the situation is much more straightforward for new works. Authors get a period of protection of “life plus 70” with no renewal or registration requirement. It is beyond comprehension that Canada would want to go backward and institute a renewal requirement.

A further barrier to making the full term of “life plus 70” conditional on a renewal registration is Canada’s membership in the Berne Convention, the international copyright convention to which almost all countries belong. Berne requires a minimum copyright term of life plus 50 years (with no registration requirement) but allows members to apply a longer term if they wish. Members applying a longer term may offer that longer term to rights-holders in all Berne Convention countries or they may limit the benefits of the longer term to nationals only of those countries that offer a reciprocal term of protection. For this reason, Canadian rights-holders will gain the benefit of an extra period of protection in the EU once Canada extends its term and brings it into alignment with the period of protection granted in EU member states.

If Canada instituted a renewal registration requirement to gain access to the additional twenty years of protection, this would almost certainly be a violation of the Berne Convention principle that protection must not be conditional upon compliance with any formality, i.e. the Berne cardinal principle of “automatic” protection. (No-one knows for sure if it would be a Berne violation because no state has ever been dumb enough to shoot itself in the foot by imposing one). However, it has been argued by those opposed to extending the term of protection that since Berne only requires a protection period of “life plus 50”, a registration requirement for the additional period would not be inconsistent with the Convention. The only close parallel we have suggests that this is not true.

Based on the precedent of what happened when the US finally joined Berne in 1989, it is possible that Canada could technically require Canadian rights-holders to register for the additional period but would still have to extend the benefit of the full “life plus 70” term to rights-holders from other Berne Convention countries without requiring them to register, even as it subjects Canadians to this restrictive measure. This is what happened when the United States joined Berne. For many years, the US maintained a copyright registration system that was incompatible with Berne’s principles, which was one of the reasons it declined to join the Convention. When the US finally decided it needed to join Berne, it was required to abolish its compulsory registration requirement used to establish copyright but nonetheless retained voluntary registration in cases where rights-holders wished to bring infringement cases. However, because of Berne, the US could not apply this additional registration requirement to non-US rights holders. This has resulted in the rather bizarre situation where a US rights-holder has to register copyright in order to bring an infringement action in the US but a non-US rights-holder is exempted from doing so. In this instance, foreigners get “better than national treatment” in the United States. Were Canada to impose registration requirements, it would be disadvantaging Canadian rights-holders compared to non-Canadians.

Dr. Geist ignores all the drawbacks and pitfalls of a renewal registration regime and instead repeats a number of tired and in some cases debunked arguments about term extension imposing a “hidden tax on consumers”. It is no more a tax than an environmental recycling fee is a tax. There are probably some instances where consumers are required to pay more for a book that is protected by copyright than one in the public domain, although the evidence of this is inconclusive. Public domain works are often no cheaper than works still under copyright. Just as there are valid reasons why consumers pay more for products that come in recyclable containers, so too there may be valid reasons why a book under copyright carries a higher retail price than a public domain work. One of these may be royalties paid to the author. Pirated movies and streaming services also offer lower costs to consumers than legitimate services; it doesn’t follow that we should compare prices for pirate services with those in which distributors license content legally. I don’t have the time and space in this blog post to deal with all the misleading claims about the supposed costs of term extension, but I covered many of them in this earlier posting, “Copyright Term Extension in Canada: Facts versus “Fake News”.

So, in the end, what is the government likely to do? Hopefully it will take the sensible option of extending Canada’s copyright term of protection in a simple, straightforward, and transparent way, avoiding the costly and unnecessary creation of a copyright renewal registration process. Given the signals that were sent during a consultation paper on the extension issue in February of 2021, it will provide some means to address the question of “orphan works” and “out of commerce” works that is of concern to the “LAM” (Libraries, Archives and Museums) sector, but will sensibly ignore the copyright minimalists campaign to complicate the copyright system for both rights-holders and users alike by adding a registration requirement. This common sense outcome would indeed make the search for that copyright needle worth the effort.  

© Hugh Stephens 2022. All Rights Reserved.

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