Tag: India

India’s Proposed Compulsory Licensing Scheme for AI Training: It Could be the Worst of All Worlds.

A wooden gavel striking a golden copyright symbol with the text 'COMPULSORY LICENSING' in bold.

Used with permission

In early December the Indian government through the Department for Promotion of Industry and Internal Trade (DPIIT), launched a public consultation on its proposal for a “One Nation, One Licence, One Payment” regime to govern AI training on copyrighted content. The comment period closes early next month. The stated intent is to establish a framework to allow AI developers to access proprietary content for AI algorithm training, without rightsholder authorization, while ostensibly taking into account the concerns and economic interests of those same rightsholders. The proposal from a semi-official committee established by DPIIT is based on a compulsory licence regime covering all content, past, present and future, with no opt outs for content owners. Given the unrepresentative nature of the committee, which failed to include rightsholders from many creative sectors, it is not surprising it has managed to come up with a solution that pleases absolutely no-one, not rightsholders nor the AI industry. Moreover, it is probably unworkable and could rightly be described as the “worst of all worlds”. How did we end up here?

It is widely accepted that to further refine and develop AI, more data is constantly required. Quality data is important. The better the data, the better the product. Many AI developers have, without authorization, already helped themselves to vast amounts of copyright protected material either through accessing pirate databases or by simply hoovering up publicly accessible (but nonetheless copyright protected) content on the internet. The result has been a series of lawsuits launched by rightsholders, primarily in the US but also in India, the UK and Canada. In the US the parameters of the fair use doctrine are being tested, with mixed results. There have been some settlements, notably the Bartz v Anthropic case in which AI developer Anthropic agreed to pay a group of authors $1.5 billion for having accessed and reproduced their works through pirate websites (and without authorization), as well as a large number of voluntary licensing agreements between corporate rightsholders such as media outlets, publishers and music labels, and AI companies. Clearly, legal leverage is needed to convince AI developers to negotiate with rightsholders (no one is volunteering, that’s for sure). In the US this is backed up by a statutory damages’ regime where the risk of being hit with large statutory damages per infraction is a strong incentive for the AI industry to reach licensing deals. Unfortunately, many countries do not have a statutory damages provision in their copyright law, and India is one of them.

Ironically, outside the US where the fair use case-by-case legal doctrine does not exist, AI developers are arguably in even greater legal jeopardy. As a result, they have pushed for a wide statutory text and data mining (TDM) exception to be introduced into national copyright laws. The AI industry is doing this in India, although there is strong opposition to introducing a TDM escape hatch. When a TDM exception applies, rightsholders are paid nothing. The DPIIT “solution” proposes to address the non-payment issue–but is going about it in precisely the wrong way. Appropriating the IP of all rightsholders by imposing a draconian compulsory license regime penalizes rather than rewards rightsholders and imposes a lowest-common-denominator value on all content, not distinguishing between premium and pedestrian content while taking away from rightsholders the inherent right to determine how and where their content is used.

The compulsory licence regime proposed by DPIIT would be administered by a new non-profit body, a Collective Management Organization (CMO) to be established by statute. This would create another layer of bureaucracy harking back to the days of the “licence raj”. A government appointed committee would set rates in conjunction with the new non-profit. Royalties would be applied retroactively as well as prospectively. Existing voluntary licensing agreements between content providers and AI companies would have to be terminated and future licence agreements prohibited. Rightsholders who do not want to licence their content could not opt-out. This is overreach at its worst.

The tech industry represented by NASSCOM, the National Association of Software and Service Companies, that also includes Google and Microsoft, vehemently opposes the One Nation, One Licence, One Payment proposal, arguing instead for a TDM exception. It also argues that rightsholders who wish to opt out should be able to do so, thus avoiding AI companies having to pay royalties for content it does not want or has already licensed. It also doesn’t want the precedent of compulsory payments, as India would be the first country globally to institute such a regime. NASSCOM claims that a compulsory licence regime would slow innovation, the card always played by the AI industry when the issue of protecting rightsholders is discussed. However, a TDM exception is not currently on offer in India. It is a “solution” that is facing increasing pushback in many countries. Australia has just rejected the concept, and other jurisdictions are examining it critically.  Where a TDM exception does exist, as in the UK and EU, its use is constrained and subject to several conditions, such as in Britain where it is limited to non-commercial research.

Not only is the tech industry strongly opposed to the compulsory licence proposal, so are rightsholders such as the broadcasting industry and Bollywood. Not only would a compulsory licence be extremely difficult to implement given the nature of CMOs which are generally highly inefficient and administratively cost heavy– not to mention that the Committee’s working paper proposes two layers of CMO (thus double handling and processing)– but the draconian and sweeping nature of the compulsory licence is of great concern. Rightsholders are given no ability to opt out or to refuse to have their content conscripted. In fact, the proposal includes a provision granting AI developers access to content as a “matter of right”. What happened to the fundamental right of an author to determine how, when and even if their content is to be reproduced? Compulsory licences are extraordinarily blunt instruments and do not work when sophisticated content like audio-visual and music products are involved. There are many elements to licensing, including contractual issues that go beyond price that are carefully negotiated and carry with them specific obligations and privileges. A compulsory licence is a “one size fits all” solution. It strips away the rights of content owners and is, in effect, a form of “compensated expropriation”. And the compensation is minimal.

Having pleased no-one with its proposal, it remains to be seen where DPIIT will go next once all comments are received and evaluated. A follow-up proposal is expected that will deal with outputs, just as the initial one did with inputs. India, like many countries, wants to participate in the global development of AI. Its rich local-language content is a strategic asset. Imposing a compulsory licence would stifle the creativity that drives this cultural comparative advantage. In the absence of a market failure there is no rationale for resorting to the sledgehammer of a compulsory licence for all content. The preferred solution for rightsholders, voluntary licensing, is also becoming a preferred solution for AI developers as the legal ground on which they are operating in accessing content without authorization is looking increasingly shaky. Voluntary licensing is growing globally as AI developers absorb this reality. If wide TDM exceptions are off the table, AI developers will have no recourse but to negotiate licence agreements. (A statutory damages regime would provide even greater incentive to do so). Bringing in a wide TDM exception or worse, introducing a blunt and highly bureaucratic compulsory licence regime, is a sure way to kill the growing voluntary licensing market.

DPIIT’s next steps will be crucial. If the goal is to create the conditions for a “made in India” AI industry while nurturing and protecting India’s valuable cultural assets there is no better solution than to create the conditions for the growth of a voluntary licensing market. Strong cultural industries and robust AI development go hand-in-hand. This means dispensing with forced, bureaucratic solutions like the proposed compulsory licensing regime while holding firm on rejecting a TDM loophole that would allow AI companies to plunder India’s cultural richness without any compensation to creators and rightsholders. Let’s hope India gets it right.

© Hugh Stephens, 2026.  All Rights Reserved

India’s Intrusive and Overkill Tobacco Warnings for Streaming Film Content

Image: Shutterstock

The issue of how to handle smoking in films continues to be a real hot potato in many countries. As the film industry focuses on its responsibility to clearly label content that depicts smoking while avoiding any promotion of smoking in films, health authorities—in their understandable desire to curtail tobacco consumption—sometimes overzealously impose unrealistic conditions in pursuit of public health ends. It can be tricky to strike the right balance, ensuring that smoking is not promoted in films while avoiding undue censorship where some depiction of smoking is a necessary part of the storytelling. Likewise, anti-smoking warnings are a legitimate requirement—unless they are enforced through unrealistic regulations that not only interrupt the flow of a plot but require bespoke country-by-country editing to insert warnings into the narrative of the film. Saying this, I am fully aware that the tobacco industry will do just about anything to promote smoking and try to gain new consumers for its noxious products. (The marketing of candy flavoured nicotine packs in corner stores near schools in some countries is a good example, if one was needed). Various countries are grappling with this dilemma; protecting public health while ensuring that health regulations don’t inflict unintended collateral damage. India is no exception.

The current controversy in India is about new draft anti-smoking regulations for film content announced by the Ministry of Health and Family Welfare in September. The new regulations would require that online streaming services (Video on Demand), or what is known as “online curated content” (OCC) in India (think Netflix, Hotstar, Amazon Prime, SonyLIV etc), display 30 second non-skippable anti-smoking health spots at the start of—and in the middle of—any film that depicts smoking. In seeking to impose these requirements in such a heavy-handed and frankly unrealistic way, the Health Ministry managed to step clumsily on the toes of the Ministry of Information and Broadcasting (MIB), which is responsible for regulation of broadcasting. The mandatory insertion of health spots like this is both unnecessary and impractical, apart from being a questionable intrusion into MIB’s domain.

In addition to the requirement for tobacco warning spots at the beginning and midway point of films where smoking takes place, Indian media reports the regulations also require the insertion of a 20 second audio-visual disclaimer notice warning about the dangers of tobacco use, to be displayed before the film rolls. In scenes where smoking or tobacco consumption is depicted, static anti-tobacco warnings must be displayed throughout. This is a classic case of repetitive overkill. The editing and physical requirements to insert all these warning into the streaming content is no small matter. Existing global catalogue will need to be reviewed and re-edited if the content is to be shown in India. Of course nothing is impossible, even if impractical, but the result will likely be that if the insertion requirement is maintained, many films will not be shown in India. The cost of compliance will be just too great to justify the benefit of providing that particular film. Responsible members of the Indian viewing public will be the losers; others will resort to accessing pirated content to view the movies they want to see. Piracy in India is already a major issue. This proposal has the potential to supercharge it.

This sledgehammer approach is excessive and certainly not needed. Films on OCC platforms already contain warnings about depiction of smoking (as well as other relevant warnings regarding the nature of the content to be shown). Moreover, online curated content (OCC) is different from content broadcast over-the-air or distributed by cable or satellite. It is “on demand” content that is “pulled” by viewers from a menu rather than being “pushed” by broadcasters. As a result, there is a much greater element of choice and judgement on the part of the consumer. No one is going to be surprised by accidentally tripping over a film where the heroine lights up a fag or the erudite detective puffs away on a pipe. Nor is this likely to make them rush out and stock up on bidis. Viewers know in advance what they are going to watch and choose appropriately labelled and classified content accordingly.

Indeed, the “rub your nose in it” repetitive flashing of anti-smoking warnings runs the risk of turning off OCC consumers, who will tune out messages of this nature as they find themselves constantly bombarded with anti-smoking messages as they scroll for what they want to watch. For customers who routinely browse content across several streaming platforms to find their viewing preference, this could well turn them off the streaming experience altogether, just as streaming is starting to get traction in India. It is far better to deliver the message through categorization and clear labelling of content so that viewers are aware of what they will be exposed to—and are prepared to make judgements accordingly.

There is no question that smoking needs to be combatted, and that India has a smoking problem. A 2015 study identified India as the world’s second largest market for tobacco products (after China) with a smoking rate of 48% among males and 20% among females. India has already taken steps to address this problem. It was one of the first countries to ratify the World Health Organization’s Framework Convention on Tobacco Control, in 2003.

The Convention calls for a range of measures to combat smoking, including prohibiting advertising for tobacco products that is false, misleading, or deceptive and by requiring health warnings on tobacco advertising, promotion and sponsorships. It also requires restrictions on incentives to purchase tobacco and prohibition, if legally possible, of tobacco sponsorship of international events and activities. Guidelines attached to the Framework Convention suggest the elements of a comprehensive ban on tobacco advertising should include “implementing a ratings or classification system that takes tobacco depictions into account.” That is what international streamers and OCC providers in India are committed to and already provide.

Indian consumers of streaming entertainment content need to be treated as adults who, having been notified of what they are about to watch, can make informed judgements without having their viewing experience interrupted with audio visual inserts before and during the film while static messages distract their attention. There is no need for the Health Ministry to drag out its big cannons to blow holes into carefully curated and suitably labelled content, trampling on the jurisdiction of the Ministry of record in the process while creating havoc in the film industry to the detriment of creators and viewers alike. By all means combat the public health scourge of smoking, but do it in a responsible, proportionate and balanced way.

© Hugh Stephens, 2024. All Rights Reserved.

India: When Does a Religious Marriage Ceremony Become a Pure Entertainment Wedding Party? (With Copyright Consequences)

Image: Shutterstock (AI-generated)

Ah Goa!. Spectacular sunsets, beautiful beaches, fish curry and crumbling 16th century Catholic cathedrals deep in the jungle. I fondly recall a couple of visits in past years. While Goa has many attractions, it is the beaches that are the bread-and-butter of the tourist industry. A lot happens on those beaches, from sunbathing to windsurfing to…weddings. And with weddings, especially Indian weddings, comes music. (The recent $230 million Ambani wedding, was the epitome of the genre). All singing, all dancing, all the time. And that is where we take up our copyright story….

In what appears to be an overly zealous desire to promote tourism and economic activity, and perhaps to respond to complaints raised by some local musicians, the Goan state government in January issued a controversial declaration regarding music played or performed at wedding parties. No copyright would apply, no licence would be required and thus no royalties would be payable for the performance or playing of music at such events. Normally such royalties are collected by hotels from patrons organizing private functions and remitted to the relevant collective society. Moreover, according to the circular, any attempted enforcement of their rights by rights holders would result in police action to prevent collection.

My first reaction on reading reports of the case was, “how outlandish”. Why not issue an edict requiring hotels to rent their facilities for weddings at half price in order to promote tourism? Or pass a law insisting that wedding caterers provide free drinks for wedding guests to promote more weddings in Goa? A US comparison might be passage of a law by, say, Hawaii or Florida, forbidding the enforcement of copyright in music played at destination weddings in order to maintain the local tourism industry. In the US, we have seen several instances of state legislation that impinged on the federal copyright power being struck down by the courts. These had nothing to do with weddings (they related to the licensing of e-books), but you get the idea. A state level government cannot make or interpret law in an area of federal responsibility. It is the same principle in India. Yet as compelling as these arguments are (to me at least), there is some legal basis behind the reasoning of the circular, although the right of the Goan state government to interpret and enforce it is another matter.

The edict in Goa can be traced back to a Public Notice issued in July of 2023 by the Central Government’s Ministry of Industry and Commerce, in which it noted complaints from the public that copyright societies had allegedly been seeking to collect royalties for performance of music or playing of sound recordings at religious events, to wit, marriage ceremonies. That notice was based on an exception in the Indian Copyright Act, Section 52 (1) (za) that permits the playing or performance of copyrighted music without obtaining a licence at a ”bona fide religious ceremony”, including “marriage processions and other social festivities associated with marriage”. Does this include all singing, all dancing wedding parties spread over several days? I would have thought not.

Goa’s edict was challenged and adjudicated by the Bombay High Court. The Court accepted that the Section 52 exception applies to bona fide religious ceremonies including marriages, but challenged the wider interpretation encompassed in the circular issued by the Goan government. It also noted Goa had used the term “weddings” instead of “marriage”.

The Chennai-based intellectual property law firm, Selvam & Selvam, has published a good analysis of the case.  After the collecting society Phonographic Performance Ltd (PPL) and another plaintiff brought suit, the Court ruled that the Goan government’s circular was ultra vires. Legal interpretation of what constitutes a “bona fide religious ceremony”, as enunciated Section 52 of the Copyright Act, depends on case-by-case circumstances, according to the Court. Such a determination must be made by the courts, not by a state government. Moreover, directing the police to take action against rights-holders seeking to enforce their rights impedes enforcement mechanisms available to rights-holders under the Copyright Act. A clear-headed decision, I would say.

But this is not the first time such issues have risen in India. As Selvam’s points out;

“there is a pressing need for clearer guidelines that can help figure out the boundaries of copyrights in celebratory contexts. Ultimately, a well-defined approach to copyright in social festivities will not only protect creators but will also support the vibrant culture of celebration that defines India.”

Back in 2022, in a case also brought by PPL, the Delhi High Court appointed an expert, Dr. Arul George Scaria, to look into the implications of Section 52 (1) (za) for copyright holders and families organizing weddings. His lengthy report was sympathetic to a broad interpretation of the exception, arguing that under Berne it amounts to a legitimate “minor exception” while also noting the importance of music and cultural practices to marriage ceremonies in India. However, since the case was settled out of court, his report has had no direct impact on Indian jurisprudence in this area. By contrast, others have argued that the use of music at weddings goes beyond private, religious use since the wedding industry in India is highly commercialized. Some wedding events are spread over a number of days, up to a week, and involve many more than just a few friends and family. In effect, they become public performances.

India is not the only country to provide a copyright exception for music and sound recordings when used for religious purposes. It also exists in Canada (Section 32. 2 (3) of the Copyright Act) and in the US (Section 110 (3) of the US Copyright Act), and probably in many other countries. I am not aware, however, of any attempt to extend this exception to wedding parties, except in India.

Marriage ceremonies and weddings (the two may not be synonymous these days) are an important part of any culture, in India as elsewhere. Whether it is Mendelssohn’s Wedding March (long in the public domain I should add), a couple’s choice of contemporary music for their big day, or the latest Bollywood songs played by a DJ, music is an integral part of such events. When one hires a band or a DJ for a wedding reception here, usually the last thing the parents-of-the-bride think about is licensing the music (speaking from personal experience). Yet, DJ’s who use recorded music at events like wedding receptions (and other public performances) require a licence. Often the licence is covered by the hotel venue or the event planner so preoccupied parents or the couple themselves need not stress out too much. What is clear is that such music is not covered by the religious exception. This is where India seems to be a bit of an outlier.

But the law is the law and Section 52 (1) (za) is part of the Copyright Act of India. Defining where the limit between exercise of religion ends and pure entertainment begins should and will fall to the Indian courts, unless there is further legislation clarifying the intent of the Indian Parliament. The tourism promotion authorities at various sublevels of government should stay out of it. That seems to be the lesson learned in this case.

© Hugh Stephens 2024. All Rights Reserved

India Government Adopts New Tool to Tackle Film Piracy and Modernizes Content Classification

The morning view of Taj Mahal monument reflecting in water of the pool, Agra, India on 04 October, 2014. (Under licence from Envato Elements Pty)

On August 4, 2023, India’s Cinematograph (Amendment) Bill, 2023, received Presidential assent and became the law of the land. Enactment marked the culmination of a decades-long process to update the country’s anti-piracy laws by cracking down on camcording in theatres and imposing significant penalties for distribution of illegally recorded films. This legislation marks a real breakthrough in upgrading the governance of India’s theatrical industry in terms of anti-piracy measures and modernization of the certification system. In addition to imposing deterrent punishments for piracy, the legislation has brought the film rating system into alignment with internationally recognized best practices and standards, removed the federal government’s power to review a film’s certification after the Central Board of Film Certification (CBFC) has certified a film and replaced the ten-year validity of censorship certificates with perpetual validation.   

The new legislation was hailed by both India’s film industry as well as the government. The Producers Guild of India welcomed the increased penalties for piracy, which stipulate a jail term of up to three years and a fine that can total as much as up to five per cent of a film’s production cost. This is a significant financial penalty that begins to reflect more accurately the impact of lost revenues for producers. The sanctions are not just for illegal camcording, but also for distribution of an infringing copy to the public for profit, both offline in physical premises and online. Through the imposition of significant financial penalties, the new legislation punishes not just the perpetrator of the camcording, who may be a low-level operative hired to take the risk of making the infringing copy, but also goes after the distributors behind the piracy. In other words, it “follows the money”. It is estimated by the Indian government that piracy costs the Indian film industry up to US$2.4 billion annually. The Indian courts and authorities have since 2018 done an excellent job of promoting online content protection via site blocking orders related to “rogue” piracy websites, and the new, focused provisions will give rightsholders and law enforcement an additional strong tool to tackle film piracy at the source.

The government of India, the Minister of Information and Broadcasting, and indeed senior officials within the Ministry all deserve credit for pushing the initiative through. This significantly more robust stance against piracy, which has been the scourge of the industry for years, reflects the greater emphasis placed by the Indian Government on establishing and reinforcing India’s role as a source of innovation and creativity. As Information and Broadcasting minister Anurag Thakur stated so aptly, “India is known as a country of story tellers which shows our rich culture, heritage, legacy and diversity”. That storytelling tradition as expressed through film was under threat. Not only does the industry contribute to the country’s cultural richness and diversity, but it also provides employment for hundreds of thousands of workers, from film stars to caterers, designers, hairdressers, directors, choreographers, film technicians, musicians; indeed the full panoply of talents and occupations that make up the film industry. And that is not to mention the contribution of the film industry to the country’s GDP. A study commissioned by the Motion Picture Association in 2019 concluded that the film and television industry directly and indirectly generated employment of 26.6 lakhs (2.6 million) and contributed over INR 415,000 crore (US$50 billion at current exchange rates) in economic output. 

While the anti-camcording and anti-piracy elements of the legislation constitute a major breakthrough, the other elements of the legislation are also important. Updating the age-related categories for “U/A” films, by creating new categories of classification in the U/A category that fills the gap between Unrestricted and Adult, has modernized the film rating system, allowing parents to determine with much greater accuracy what sorts of films their children can watch. The new categories of U/A 7+, U/A 13+, and U/A16+ will allow for content differentiation, expand viewing options for young people and allow parents to make the call as to what films are suitable for various ages. The previous “all or nothing” approach was not serving the needs of the viewing public and led to uncertainty as to the suitability of general U/A films for particular age categories. The regulation’s adoption of revised television ratings is another improvement on a previously informal process.

One of the more politically delicate elements in the legislation was the decision to delete any provisions that would empower the federal government to overrule the censorship authority (Central Board of Film Certification, CBFC) by revoking a film’s certification. Such reserve authority not only undermines the effective working of the CBFC but opens the film censorship and rating process to political interference. Given the judgment in the Union of India v Shankarappa case, doing away with the revocation of the certificate clause is a wonderful change. It provides greater autonomy to the CBFC and builds predictability and certainty for a film’s producer.

Last but not least, an additional welcome feature is replacing the previous ten-year validity of a film certificate with one that is valid perpetually. If a film clears censorship and is released, why would its certificate need to be reviewed in ten years’ time? If there is no good reason to do, the renewal simply becomes a bureaucratic exercise that unnecessarily burdens film producers.

To manage the vicissitudes of the parliamentary process, where bills can fall hostage to unrelated political issues and die on the order paper, the government introduced it first into the upper house, the Rajya Sabha, thereby ensuring it would not be expunged each time a parliamentary session ended. This was an astute move. It passed the Rajya Sabha on July 27, 2023, and the Lok Sabha, by voice vote, on July 31, 2023. That is an amazing feat after more than 40 years of delay since the legislation was last amended in 1982.

The film industry is truly one of India’s cultural gems, along with its great art, literature and religions. Indian films are a dynamic cultural and economic force domestically and globally. Now the investment that goes into producing them will be better protected and there will be much greater certainty regarding the sanctity of cleared and rated content. The industry will continue to grow and flourish through the creativity and artistry of Indian talent. But the Government of India has played an important role helping to secure this future. Shabash!

© Hugh Stephens 2023.