2020. The Annus Horribilis—but Creators and Creative Industries will Bounce Back

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They say that hindsight is 20/20. Well, looking back at 2020, the annus horribilis, one could be forgiven for not having a clear view of what was to come when the year began, with vague rumours circulating of yet another virus in China emanating from wild animal markets. Surely it couldn’t be as bad as SARS? As this challenging year draws to a close, we are all a little bit wiser and a little bit more skeptical of the “don’t worry; it’s all under control” messages from those who are supposed to know.

COVID-19 around the World

Looking back at 2020 wearing a copyright lens, what do we see? It’s been a devastating year for creators, especially those who perform live for a living. Early in the pandemic, in March, just a couple of weeks after the first lockdowns were imposed, I wrote about the initial response from governments and others to the plight of creators who saw their livelihoods imploding. Concerts, plays, and other stage performances were cancelled overnight. Galleries, libraries, bookshops and record stores shut down. Half the world (the half with internet access) went online. Creators and creative industries responded with a range of virtual offerings and new online materials for adults and children. Unfortunately, others took advantage of the situation to advance their own agendas, like the Internet Archive’s unilateral declaration that it would be happy to make other people’s (copyrighted) works available online for free. As I wrote in April in this blog, (“COVID is Not an Excuse to Throw the Accepted Rules Out the Window: Copyright as the Canary in the Coalmine.”);

“…it is extremely disappointing to see special interest groups taking advantage of the COVID crisis to push their personal pre-COVID agendas. In the case of copyright, this consists of using the crisis to attack the fundamentals of copyright protection, namely the right of creators to control distribution of their work, and thereby to earn a return on the sweat equity they put into the creation in the first place.”

By the fall we were into the “second wave” and the impact of the pandemic on the copyright and cultural industries was even more apparent. My blog in November “Covid and Culture: What’s Around the Corner”) chronicled the damage to cultural institutions, such as museums and heritage sites in various parts of the world where the lack of visitors has, in some extreme cases, resulted in lack of maintenance, vandalism and a cessation of research and preservation activity. The economic damage to the creative sector even in western countries with generous government financial support programs and good internet infrastructure has been devastating. Brookings estimated that the cost to the creative sectors in the US for just the period April to July to be about $150 billion with the loss of 2.7 million jobs.

New Copyright Interpretations in Canada Compound the Challenge

The economic hit from COVID was compounded by the ongoing value gap faced by performers trying to live off the digital pennies distributed by online platforms and, in Canada, a court decision that had the effect of undermining an important element of copyright protection. This was the result of the ongoing legal saga pitting York University versus Access Copyright, a landmark case which took yet another twist. Back in 2017, Access Copyright (AC), the copyright collective representing authors and publishers, won a significant victory at the Federal Court regarding York University’s unlicensed use of materials in AC’s repertoire. The Court ruled that York (which was in effect acting as the proxy for most post-secondary institutions in English Canada) was required to pay the interim tariff (i.e. regulated license fee) established by the Copyright Board of Canada for use of AC’s materials, while it also dismissed York’s claim of fair dealing with regard to its use of these materials. In other words, the Federal Court ruled that if any content within AC’s repertoire was used, payment of the tariff was mandatory, not discretionary. York appealed.

In April of this year the Federal Court of Appeal (FCA) delivered a stunning decision. It overturned the initial ruling that had affirmed the mandatory nature of the interim tariff and went on to declare that all tariffs, interim or final, established by the Copyright Board are discretionary. Moreover, the FCA declared that payment of the tariffs always had been discretionary despite decades of practice based on the assumption that once certified by the Board, tariffs were applicable to all who used materials in a copyright collective’s repertoire, whether licensed from the collective or not. This stood the established copyright order on its head, as I wrote in a blog posting, “When is a Mandatory Copyright Tariff mandatory only if you Opt-in?”. The FCA’s decision has in turn been appealed to the Supreme Court of Canada, which has agreed to hear the case. This could, however, take years. In the meantime it would be far better for Parliament to address this anomaly by amending copyright legislation to undo the damage of the FCA’s decision. There are expected to be opportunities to do this in the next year or so as there are several copyright-related issues that need addressing.  

News Publishers vs Big Internet Platforms: Revenue Sharing in France, Australia and Elsewhere?

One such issue is that of the relationship between the big internet platforms and news providers. There is growing global pressure for the introduction of measures to require the platforms to share with content providers some of the online advertising revenues that are generated by using excerpts of their content in search listings and social media posts. France and Australia have been the first two countries out of the starting blocks on this, although the UK, Canada and some EU countries have not been far behind. There has been less pressure in the US, although a proposal has been floated in Congress to grant an anti-trust exemption to news publishers to allow them to negotiate collectively with the platforms without falling afoul of competition law.

As I wrote back in April (here), in France the authorities took the gloves off and gave Google three months to engage in good faith negotiations with publishers to come up with an agreement that would result in payment to news content providers. France was thus the first EU member state to put in place measures to implement a new “neighbouring right” provided to publishers as part of recent revisions to the EU Copyright Directive. Google appealed the French Competition Authority’s ruling, and lost. The result has been a recent announcement that Google has finally reached agreement with six major French news publishers, including Le Monde and Le Figaro, on a revenue sharing deal. This isn’t the first time that Google has blinked.

In October of this year, Google announced it was establishing a $1 billion fund (over three years) to pay for curated news content, starting initially with Germany, Brazil, Canada, the UK, Australia and Argentina. Most of the initial agreements were with smaller, lesser-known publications. Perhaps not surprisingly, these are countries where governments have been actively pursuing measures to level the playing field between those who create the content and those who benefit financially through distribution or indexing of this content. Australia has been particularly active, through its competition bureau, the Australian Competition and Consumer Commission (ACCC), which has developed a draft News Media Bargaining Code, targeted particularly at Google and Facebook.

Both platforms pushed back strongly, trying to mobilize Australian consumers to oppose the ACCC’s plans by threatening to reduce or curtail services. The Australian government indicated in no uncertain terms that it was not prepared to back down, and Google was denounced by Australian Treasurer Josh Frydenberg for using bullying tactics. Immediately after Google announced its media fund, (which included some smaller Australian media players), it promptly put its Australian program on hold because of its unhappiness with the ACCC’s draft code. As I wrote at the time, it was a classic case of bait and switch. (“Google in Australia: Dangle the Carrot, then Yank it Away”). That tactic didn’t work, however,  and in early December of this year Australia proceeded to introduce legislation that will require Google and Facebook to negotiate with Australian news organizations for use of their content in Facebook’s Newsfeed and Google search. If the two sides are not able to reach agreement, there is provision in the legislation for compulsory arbitration. Many countries, including Canada, the UK and the EU are watching to see what happens in Australia.

In Canada, after having announced that its newly unveiled media fund would include Canadian media, Google likewise suspended its program pending negotiations with major media outlets. It has managed to sign up only two small digital news platforms. The major players, who are all members of the industry association News Media Canada, have mounted a major campaign to get the Canadian government to follow the Australian example. In November they released a study “Levelling the Digital Playing Field”, that takes aim straight at Google and Facebook, seeking revenue sharing for the platform’s use of news content;

Google and Facebook are two of the biggest companies in the world.  You might say they’re modern-day Goliaths. They are using their monopoly power to scoop up 80% of online advertising revenues and to free ride on the news content produced by hardworking journalists and publishers across Canada. Maybe it’s time to start leveling the playing field a little, so the Davids of this world can start fighting back.”

Not that the major Canadian media players are exactly “Davids” but they are facing financial stresses like most media organizations globally. One response has been a Canadian government promise of tax credits to support the hiring of journalists, but this program has yet to be rolled out despite being announced two years ago. Back in 2017, publishers proposed direct subsidization of journalist wages, a proposal that provoked considerable debate and negative comment. These kinds of subsidy programs are controversial because they smack of government intervention, potentially compromising media independence, although the Local Journalism Initiative, a five-year $50 million government-funded program is now in effect, administered by none other than News Media Canada, along with some smaller non-profits.

Amending copyright legislation to create a “publishers’ right” (as is the case in the EU) is another proposal that would strengthen the hand of content creators in negotiating with the major digital platforms. Back in September I speculated that Heritage Minister Guilbeault might introduce such legislation in the fall session of Parliament, but this has not happened as the Ministry is instead preoccupied with legislation to amend the Broadcasting Act. Although providing additional neighbouring rights under copyright legislation is one option, News Media Canada seems to prefer the Australian approach of using competition law to force the platforms to negotiate revenue sharing. This ongoing tussle between the top digital platforms and news content providers is one of the big copyright stories of 2020, and the push to require Google and Facebook to share the wealth—ad revenues created in part from their unlicensed use of content created by others—is one of the few bright spots for creators coming out of 2020.  What the final result will be in 2021 remains to be seen.

The Coming Year

And speaking of 2021, let’s hope it will be a better year for everyone including those in the creative sector. As I write, the first vaccine shots are being given in several countries, and therein lies hope that the rhythm of life will resume a more normal pace in the coming year. If the pandemic has taught us anything, it is that the creative arts are among the things that make life worth living. A world without culture and creativity would be a pretty bleak place. The copyright world, along with many other sectors, took a huge hit in 2020, but the arts and its practitioners are resilient.

Speaking personally, I am looking forward to the resumption of live theatrical and musical performances, being able to escape to a big-screen experience at a local cinema and enjoying art and photographs at a gallery or museum without wearing a mask and keeping two metres away from everyone around me. (That is besides getting my hair cut properly!). We will only know from hindsight whether these hopes will be realized, but perhaps a year from now when we look back at 2021, we will declare it to have been the year of recovery. Fingers crossed.

© Hugh Stephens, 2020. All Rights Reserved.

Victoria’s “More Peace, More Justice” Mural and the ACAB Controversy: Who Was “Morally Right”?

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Victoria’s “More Peace, More Justice” Mural and the ACAB Controversy: Who Was “Morally Right”?

ICYMI, texting has brought many new terms into the English language. IMHO, there is a whole new language developing which, LOL, may leave the uninitiated grasping for the meaning of text abbreviations which, to others, is obvious. BTW, you might be wondering what all this has to do with copyright, but if you stay tuned you will find out. It all has to do with an acronym, ACAB, hidden in the design of a piece of street art commissioned from a group of 17 artists by the City of Victoria, the capital of British Columbia, as part of its commitment to fight systemic racism. Entitled “More Peace, More Justice”, the work was painted on the pavement at Bastion Square, in the heart of the “old town” part of the city. It celebrates BLM and BIPOC groups and was organized through the African Heritage Association of Vancouver Island. The ACAB acrostic was buried in the letter “S” in the word “Justice”.

If any of these shorthand expressions are unknown to you, you can look them up. You might find that ACAB might stand for “Always Carry A Bible”, but the more common usage today is used to describe the attitudes of certain groups toward law enforcement. It is commonly rendered as “All Cops are Bad” or, more pejoratively “All Cops are Bastards”.  It turns out that this is not a new acronym, although I have to confess that I had not heard of it before. (Maybe this says something about the cocoon I apparently live in). Until recently, if I’d seen someone with an ACAB tattoo on their arm, I wouldn’t have had a clue as to its meaning. ACAB is reported to have originated in the UK in the 1920s. It became popular in punk rock circles in the 1980s and 1990s, and more recently has become quite widespread during anti-racism protests.

What started out as a gesture of reconciliation by the City of Victoria to reach out to marginalized groups ended up being highly controversial and splitting the community as a result of the “secret” insertion of ACAB in the street mural. When the offensive lettering was pointed out, Chief Constable Del Manak of the Victoria Police objected, calling the inclusion of the acronym disrespectful and offensive, and City Council voted to paint over the letters. Although the sponsoring organization said it did not condone the secret message, a number of the artists staged a sit in to block the City’s action. As a result, city officials backed down and instead engaged in discussions and negotiations with the artists. The final outcome, which in the eyes of Chief Manak was just as offensive, if not more so, blanked out the letter “S” and in its place inserted;

“This letter has been censored by the City of Victoria influenced by the Victoria Police Department. In doing so, Victoria is contributing to the silencing of Black and Indigenous voices and experiences across this land”.

A compromise of sorts, I guess, but certainly not one to calm troubled waters. I am going to stay away from the substance of whether or not the artists were justified in including the anti-police message in their mural, but suffice to say they got plenty of attention—lots of it unfavourable. A number of irate citizens weighed in, including one who decided to spray-paint over the revised wording. Some pointed out that since the City had commissioned the work, it had the right to amend it without negotiating with the artists. One local artist wrote to Victoria’s daily paper, the Times-Colonist;

“I have sold a number of pieces of both my own and commissioned work. I could not imagine incorporating a political message of my belief into a piece of commissioned work, without the knowledge of the purchaser. It would be unprofessional, as well as morally unethical”.

No arguments there. But then he continues;

I was angered to read that the artists responsible for the work were involved in “weeks of negotiations with the city” as to how to deal with the offensive acronym…I have been fortunate enough to purchase a few pieces of original art in my lifetime. Since I bought and paid for them, they belong to me. I can do whatever I wish with them…Since the city owns this installation, the city should not really have to consult with anyone as to what happens with the piece.”

Hmmm. Hold on a sec. I’m not so sure about that. As much as it may sound logical that if you own it, you can do whatever you want with it, in the case of art the situation is not so clear. First, Canada no longer follows the “work for hire” doctrine (applicable in the US) so just because a work is commissioned, that does not mean that the purchaser owns the copyright. It is retained by the artist, and in this case the copyright is presumably held by the two artists who painted the letter “S”, or perhaps collectively by the entire group of 17 artists. And if they hold the copyright, they can exercise their “moral rights” to prevent unauthorized alteration of their work.

What are moral rights, especially in a Canadian context?  The Berne Convention, the international treaty that regulates copyright and to which Canada has been a party since 1928 (actually since 1887 as part of the British Empire but since April 10, 1928 in its own right), has this to say about moral rights, in Article 6bis;

“(1) Independently of the author’s economic rights, and even after the transfer of the said rights, the author shall have the right to claim authorship of the work and to object to any distortion, mutilation or other modification of, or other derogatory action in relation to, the said work, which would be prejudicial to his honor or reputation.”

In Canada, the right to object to any distortion, mutilation or other modification is known as the “right of integrity”. According to well-known copyright lawyer, educator and blogger, Leslie Ellen Harris, writing on the website LawNow;

“The right of integrity is the right of the author to object to any changes of his work that may harm his reputation as an author. This harm would be a question of fact that would have to be determined in court through the testimony of witnesses. For example, painting a moustache on the Mona Lisa (if the Mona Lisa was still protected by copyright) would likely be a violation of Da Vinci’s moral rights”.

The best known moral rights case in Canada involved the artist Michael Snow. Snow’s work Flight Stop, a representation of sixty geese, hangs in the main galleria of the Eaton Centre in downtown Toronto. Commissioned by the Centre’s developers in 1979, in 1982 the geese became entangled in a legal controversy over Snow’s moral rights. Just before Christmas of that year, the management of the Centre decided to bedeck Snow’s geese with red ribbons and use photos of the bedecked geese on promotional items. Snow objected, claiming that the addition of the ribbons altered the character and purpose of the work and negatively affected his artistic reputation. Mall management disagreed, and the case went to the Ontario High Court (Snow v Eaton Centre Ltd), which ruled in Snow’s favour. The Eaton Centre was given three days to remove the ribbons, which they did. Snow had made his point and asserted his moral rights.

Now to return to the “More Peace, More Justice” street mural in Victoria, and its hidden ACAB message. It seems to me that the City of Victoria was wise to have entered into discussions with the artists rather than peremptorily disfiguring the work, no matter how noble it felt its cause was. Perhaps the Council actually took some legal advice on the matter?  Maybe a group of 17 young artists would not have had the staying power to take the City to court, but who knows? A rich benefactor may have stepped up. It would have been very messy, although the “compromise” that was worked out was not so clean either.

Anyway, I hate to disappoint our local Victoria artist who seemed to think that an owner or collector can do whatever he or she wants with a piece of purchased art. It ain’t so. So I conclude that in the end, as unsatisfactory as the outcome may have been to a number of people, the City of Victoria did the right thing by negotiating and coming to a compromise solution agreed to by the artists. 

By way of conclusion, let me add one more acronym to the alphabet soup I have dropped into this blog. WIPO. The World Intellectual Property Organization, the international body that administers the Berne Convention and other intellectual property (IP) treaties. Who would have thought that in the end WIPO would probably have protected the right of a group of street artists to insert ACAB into a piece of commissioned street art?

Well folks. I have to run. TTFN.

© Hugh Stephens 2020. All Rights Reserved.

The USTR Notorious Markets Report: Does it Provide Free Advertising for Pirates?

The USTR Notorious Markets Report: Does it Provide Free Advertising for Pirates?

It’s that time of year again[i] when the Office of the US Trade Representative (USTR) seeks public comment and input to its annual “Notorious Markets” exercise, a supplement to the annual USTR Special 301 report on the intellectual property practices of other nations. The Federal Register notice indicates that USTR;

“requests comments that identify online and physical markets to be considered for inclusion in the 2020 Review of Notorious Markets for Counterfeiting and Piracy (Notorious Markets List). The Notorious Markets List identifies examples of online and physical markets that reportedly engage in and facilitate substantial copyright piracy or trademark counterfeiting. The issue focus for the 2020 Notorious Markets List will examine the use of e-commerce platforms and other third-party intermediaries to facilitate the importation of counterfeit and pirated goods into the United States.”

The bulk of the comments provided come from industry which does the research and draws to the attention of USTR the websites, e-commerce platforms and physical markets that engage in the widespread sale of–or which facilitate the distribution of—infringing and counterfeit products. A good example is the submission from the Motion Picture Association that extensively documents the illicit activities of a number of linking and streaming websites, direct download cyberlockers, streaming video hosting services, illegal IPTV services, piracy devices and apps, peer-to-peer networks and BitTorrent portals, hosting providers, certain domain registries, and some payment providers, ad networks and online advertising services. In total, over 50 entities are named, yet the submission notes that this is not a comprehensive list, merely illustrative. Among the names are creative monikers (that clearly reveal their marketing intent) such as Mr. Piracy, Gimyvod, Everstream, Topflix, Unblock Tech and a host of other less descriptive “businesses” living in the shadowy corners of the internet.

Physical markets are also named (none in the US), with the one closest to “home” being the Pacific Mall in Toronto, (although it was dropped by USTR in last year’s report). Pacific Mall also made it onto the EU’s similar Counterfeit and Piracy Watch List in 2018. I visited the Mall a couple of years ago (see my account here) and found it more of a flea market than a hotbed of pirated and counterfeit goods, so perhaps the persistent efforts to put it in the spotlight have had some positive results.

USTR is quick to note that its Notorious Markets report, “is not an exhaustive account of all physical and online markets worldwide in which IP infringement may take place,” and it “does not make findings of legal violations nor does it reflect the U.S. Government’s analysis of the general IP protection and enforcement climate in the countries connected with the listed markets”. Yet inclusion on the list is no small matter. Last year Amazon was listed, but indirectly by naming Amazon’s websites in several countries outside the US (UK, Canada, France, Germany, India). It’s not that platforms, sites or markets distributing or facilitating the sale of pirated or counterfeit goods don’t exist inside the United States; it’s just that it’s not USTR’s practice to report on them.

Despite this, in the MPA submission there is indirect mention of several US-based entities such as Cloudflare, eBay, and Facebook Marketplace. Cloudflare has long been a problem, as I wrote about last year (here), allowing its technology to be used to shield from scrutiny pirate sites and other websites engaging in illegal activity. Its technology provides a reverse proxy functionality to hide the real IP address of a webserver. Unfortunately, Cloudflare is not too fussy about who its customers are. However, despite referencing Cloudflare and others, MPA did not specifically list any US companies for inclusion on the list. But the EU had no such hesitation, listing Cloudflare and noting in its Watch List report that the service is used by approximately forty percent of the pirate websites in the world to hide their true identity.

When it comes to compiling the list, most of the research and heavy lifting is done by US trade associations and others who file submissions identifying problem markets or services. Besides the film industry, other sectoral trade associations that usually “comment” to USTR represent the music industry, video and electronic games, publishing, footwear and apparel, technology, computer software and some others. As comments are posted, rebuttals and clarifications are sometimes also submitted during the process by entities protesting their potential inclusion, although the most egregious dedicated pirate and counterfeit sites do not bother, precisely because they have decided to ignore US law and trade actions.

Not all the submissions are from industry or those targeted, however. This year, the online journal TorrentFreak highlighted an interesting submission from a Las Vegas based legal practitioner and self-described “concerned taxpayer”, Jim Zhou. According to Zhou, the Notorious Markets List has just the opposite effect from that intended. Rather, it operates as a facilitator of the traffic that it seeks to prevent. He argues that;

“By giving it an official seal of notoriety, the presence of this regulation effectively becomes advertising and an unwitting endorser of the services or product.”

It’s almost as if a pirate website or illicit merchant could advertise “Selected for the US Government’s Notorious Markets List for the Fifth Year Running!” If consumers of pirated content or counterfeit goods want to find out where to find the best range of product, according to Zhou they need look no further than USTR’s annual report. It becomes a sort of Consumer Reports for those researching the “best” pirate and counterfeit products. He argues that not only will consumers of illicit products use the report to find what they seek, but statistics on the numbers of users per illicit site reported by USTR is useful information for advertisers seeking to reach consumers of these products, and for the sites themselves to market themselves to advertisers. The list is given wide media coverage every year.

It’s an interesting argument, albeit one that deserves to be approached with a healthy degree of skepticism. Is there any proof that an illicit site’s business surges once it has been elevated to USTR’s hit parade? None that I know of. In fact, there is a chicken-and-egg element to this because a site or service would not be on the list if was not already “successful” to some degree, having attracted the attention of legitimate providers of services, products and content that want to put it out of business.

I reached out and contacted Zhou to ask him how he had reached his conclusions. He conceded that he did not have any statistics but said that knowing how opaque markets work in other areas, he didn’t see why pirate and counterfeit markets would be any different. As an example from another sector, he cited the DARE (Drug Abuse Resistance Education) programs. DARE, whose aim is to prevent youth from succumbing to drug addiction through drug education programs delivered through schools, has been criticized in the past for ineffectiveness or inconclusive outcomes. (It has since revised its curriculum.) In Zhou’s view, DARE programs in the 1990s had the perverse effect of introducing kids to drugs rather than keeping them away from using. The marketplace for pirated and counterfeit goods is no different from any other underground marketplace, he stated, where reputation for having the “good stuff” is all-important. It certainly gives one pause for thought.

Anecdotally, I can testify from personal experience in China a few years back about a similar phenomenon. The more that American and European companies complained to their governments about the infamous “Silk Market” in Beijing, and the more those governments leaned on the Chinese authorities to take action to close it down (with resultant publicity), the more popular it became. I have seen tourist brochures featuring the Silk Market (which may have sold a bit of silk, but was mostly a market for cheap knock-offs and, at the time, products like pirated DVD movies) as one of Beijing’s major attractions, on a par with the Temple of Heaven and the Forbidden City! (By the way, Beijing’s Silk Market remains on the USTR Notorious Markets list).

So perhaps Mr. Zhou has a point. That said, the Notorious Markets report has gained considerable negative prominence in recent years, and a number of companies go to considerable lengths to stay off it. This suggests it has some efficacy as an anti-piracy and counterfeiting tool. Being on the list doesn’t result in any direct legal action against a particular listing, nor is that the intended result, but it can lead to pressure being brought against named entities by the governments of the countries in which they are based. Moreover, it is hard to believe that the “free advertising” provided by USTR is of much use since the more popular a pirate site or service becomes, the more it is likely to be subject to sanctions and pressure to close down or change its identity. In the end, the result of getting free advertising from USTR may not be more business—but being put out of business.

© Hugh Stephens, 2020. All Rights Reserved.

[i] November 8, 2020 was the deadline for submission of comments and November 22, for rebuttals and other information.

Korean Copyright Reform: Don’t Stifle Korean Filmmaking

Used with permission

The Korean film industry is one of the major artistic and cultural successes in Asia. The industry was propelled to prominence in Europe and North America through the 2019 film “Parasite”, which won the Palme d’Or at Cannes and Best Picture (plus three other awards) at the 2019 Academy Awards. Korean films have come a long way from the days of the “screen quota”, a measure first imposed by the Korean government back in the 1960s in an effort to promote Korean content. It required Korean movie theatres to devote a minimum of 146 days per year to screening Korean films, and became a major bone of contention between Korea and the US in the period leading up to the negotiation of the Korea-US free trade agreement. The screen quota had the perverse effect of forcing many theatres to go dark for weeks at a time for want of Korean content. A much-reduced screen quota still exists on the books but has become moot because of the spurt in creativity of Korean filmmakers and the resultant investment in the sector. This demonstrates that good stories, production values and talent make films commercially viable, not government quotas. Typically, domestic Korean films take 50-60 % of the box office, a high percentage in comparison to many other countries. The Korean film and television industry generated a total economic contribution of USD18.45 billion in 2018 and supported over 300,000 jobs. That is quite a record—but it is in jeopardy.

Korean filmmakers, like those in other countries, draw inspiration for telling compelling stories from real-life events, but a currently proposed amendment to the Korean copyright act could put such historically or “true story” based films at risk. The amendment would create a “portrait right”, which would be accorded to “a person (in Korea) who can be widely recognized by the general public as the object of a portrait”. This would confer a property right on that person or their estate that could be utilized commercially. The right would exist for the lifetime of the person in question plus an additional thirty years. It is unprecedented for portrait or publicity rights to be incorporated into copyright law, and its enactment could enable publicly recognizable persons to block film productions in which they are portrayed. Recent domestic box office and artistic successes such as “The Age of Shadows” (a 2017 Academy Award submission) or “The Man Standing Next” (selected for the 2021 Academy Awards for Best International Film) might not have been made.

The great stories told through movies and television productions that we all enjoy so much are inspired from a variety of sources—novels, sci-fi epics, history, traditional children’s tales and, of course, real-life events and people. In a non-Korean context, think of films like Flight 93, Saving Private Ryan, Argo, All The President’s Men and others that are based on real-life events (although considerable poetic licence is usually incorporated into the scripts). Then there are biodramas like Milk, The Iron Lady, Erin Brockovich, and The King’s Speech, not to mention the popular Netflix series The Crown, with Season Four now released. Some of these works hew more or less to the historical record, others use real characters in highly fictionalized roles. There are also documentaries that tell a story using actual footage, some well-known recent ones being, They Shall Not Grow Old, Social Dilemma, Tiger King, Wild Wild Country, and so on. We all have our favourites. You can add your own. Now imagine that someone featured in those films objects to the portrayal of themselves, or perhaps a family member of a portrayed deceased person objects, can you imagine the chilling effect on creativity?

This is a problem that filmmakers already face, dealing with what is often referred to as the “right of publicity”. Normally if a studio is going to make a film about a living person, it acquires life-story rights. If it doesn’t there is a risk of a defamation or an invasion of privacy suit if the subject does not like the way in which they are portrayed. A good example of this was the lawsuit launched by family members of the deceased mariners portrayed in the film, The Perfect Storm, who sued for a portion of the film’s profits based on what they claimed was an inaccurate portrayal of the ship’s captain. The case was tossed on First Amendment grounds, but it shows the risks. There have been other cases in the US involving not only filmmakers but also makers of electronic games. In the US, these suits are normally dealt with through state-level legislation dealing with defamation. In some states, there is an exemption for filmmaking. Suffice to say, it’s complicated.

Imagine how much more complicated it would be if the right of publicity became a property right, incorporated into copyright law. In addition to acquiring life-story rights for the subject of a biopic, and the negotiations that take place to obtain rights that enable films to be made (licensing the rights to a book, script, music, and so on), filmmakers would be required to negotiate with those portrayed in a film, or with their estates assuming that copyright was still in effect. Making the publicity right an element of copyright law would greatly complicate film production; story-telling through films based on real events would grind to a halt.  

As noted above, in other jurisdictions publicity rights are protected by defamation or privacy laws, but they are not a property right protected by copyright. There is no creativity in being the subject of a film or book. Moreover, the definition of “portrait” in the proposed law is not clearly defined. The “portrait” does not even have to be of a famous person, simply anyone who can be recognized by the public. As another example, the award-winning Korean documentary In the Absence, a moving film about the Sewol ferry disaster that resulted in the deaths of 250 high school students, might not have been made because it clearly depicted the captain, who abandoned the ship and survived. If this clause survives and makes it into the revised law, this will impede a constitutional right to free speech and threaten filmmaking in Korea. At the very least, an exception to the portrait right is required for biopics, docu-dramas, films of historical fiction, documentaries, news broadcasts, and other similar works.

Another proposed problematic copyright act amendment in Korea is a proposal for “additional economic rights” for authors. This is a contract adjustment measure that would override freely negotiated contracts between authors and those with whom they have reached a contractual arrangement for licensing of rights, and is based loosely on the “best seller right” adopted in the EU (but not yet incorporated into member state law).  There is a symbiotic relationship between creators, such as authors or performers, and the distribution platforms (publishers, labels) necessary to disseminate their work. In most instances, the distribution platforms assume the risk by paying upfront for the rights to works which may, or may not, be successful. This proposed amendment would give authors a second bite at the apple if the work is very successful. The operative wording is, “in the event that there is a significant imbalance between the remuneration received by the author in return for the transfer of property rights…the author may request additional remuneration from the transferee”.

As in many things, the key lies in interpretation. What is a “significant imbalance”? And what impact will this have? Experience suggests that requiring a renegotiation of contract terms if a work is successful will result in lower upfront payments to authors as this creates great uncertainty for publishers who are required to make provision for potential additional payments if a work succeeds. Most authors prefer the security of a guaranteed upfront payment in lieu of a smaller initial payment which might be supplemented by additional revenue, but only in the case of unusual success. With regard to filmmaking, a high risk and expensive undertaking with contributions made by many different parties, it is important that copyright law not restrict freedom of contract. Fortunately, the current draft exempts cinematographic works from the additional remuneration right, as it should.

Other problematic amendments include the definition of “works for hire”, where the wording suggests that the author owns the work, even if completed as part of an employment contract. Although the amendment states that the work is “deemed to have been transferred” to the employer, the current law which states that the work is automatically owned by the employer is much clearer, removes any ambiguity and is consistent with the interpretation in most jurisdictions. Another potential concern is a provision on extended collective licensing, or mandatory tariffs. This is a common element of copyright law used by collective management organizations to apply approved tariffs to unlicensed users of music and publications.  Collective licensing normally does not apply to films and AV products, which in any case are meticulous about licensing content and music, and it is hoped that this will continue to be the case in Korea.

In sum, given the importance of its film industry to Korean culture and telling Korean stories, international best practices should be followed. Korea’s copyright laws should be designed to encourage its filmmakers, not stifle them.

© Hugh Stephens 2020. All Rights Reserved.

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