Wednesday, February 17, 2010

The Annual “301" Show - USTR Calls for Comment - 21 Reasons Why Canadian Copyright Law is Already Stronger Than USA's

The deadline for submissions on the U.S. “301" process has been extended until 5:00 PM on Thursday, February 18, 2010 due the Washington weather. This year, the USTR is calling for public submissions and will hold hearings. In the past, the process has been far from transparent. In fact, in the past the report has been heavily influenced if not essentially drafted by certain Washington lawyer/lobbyists with major copyright content industry clientele operating under the banner of the International Intellectual Property Alliance.

Unfortunately, it appears that the Canadian Government is not going be making a submission, despite the outreach of the USTR this year in inviting submissions and even conducting oral hearings. This could lead to false and misleading suggestions that Canada doesn't care or that it accepts past accusations. Sometimes, it's OK and even prudent to ignore absurd charges and processes. But the U.S. has taken the strategic high ground and the tactical initiative by at least purporting to open up this process. Whatever the intention, it's a clever move on the part of the USA. Therefore, it's risky to boycott it or ignore it at the public level. Private diplomatic submissions behind the scenes do nothing to reassure Canadians and will likely have little, if any, influence in Washington these days. Unfortunately, Canada's public silence on this and other IP issues may create the impression, rightly or wrongly, that Canada either cannot make up its mind or is unwilling to take a public stand on important but controversial issues. Either way, Canada risks an ever diminishing role in fora such as WIPO, ACTA, Canada/EU FTA, WTO, etc.

Nonetheless, this is an important opportunity to make views known, since the usual suspects in the U.S. copyright based industries will be working through the usual Washington lawyer/lobbyists that have much influence in the USTR to draft a report that could once again falsely condemn Canada as a rogue nation and a piracy haven, when the truth of the matter is that:
  • Canada already has much stronger copyright laws in many ways than the USA;
  • These stronger laws result in significant dollar outflows that greatly favour U.S. interests with little or insufficient benefit for Canadians;
  • There is no verified and reliable evidence of piracy or counterfeiting problems in Canada that are any worse than in other comparable countries. In fact, the largest and most accessible market in North American for pirated and counterfeit consumer products remains the streets of mid-town and lower Manhattan;
  • The alleged deficiencies in Canada's laws regarding file sharing have not been proven in any Canadian court and the music and film industries have taken no serious initiative to do so, despite having been given a green light to proceed by the Federal Court of Appeal in 2005. Instead, they lobby for US DMCA+ type laws. Indeed, much of the alleged copyright problem that the music industry complains about in Canada is a direct result of its own successful wish for a rich private copying levy, the result of which has included the effective legalization of music downloading in this country, according to comments by both the Copyright Board and the Federal Court. The music industry has proven only that it ought to be careful what it wishes for, not that there is any need to change Canadian law; and,
  • The entertainment industry in Canada is doing quite well, even as things stand. As Michael Geist recently reported, “Nielsen Soundscan has just released the Canadian music sales figures for 2009. Notwithstanding the regular claims that the Canadian digital music market cannot develop without copyright reform, the Canadian market grew faster than the U.S. market for the fourth consecutive year.”
Here's where you can make a submission to the USTR.

Here's where you can use a Public Knowledge template and customize it :

More info here.

Canadian copyright law is actually much stronger than U.S. copyright law in many ways, some of which are worth quite a lot of money to the USA. It is worth noting as well that, for most of the last century, most copyright royalties in Canada have been flowing to American corporate interests. While stronger copyright laws may not always make for better public policy, they often result in significant royalty outflows to U.S. and other foreign interests. Here are some 21 examples of how Canada’s copyright law is already stronger than the U.S. regime:

1. Canada has about 36 copyright collectives, many of which have received substantial direct and indirect government subsidies. The U.S. has only about half a dozen, with no government support.

2. Canada has a full-time Copyright Board which has normally had four full time members plus a sitting or retired Judge as Chairman and currently about a dozen full time professional and administrative staff. The Board has enormous policy and, effectively, law making powers. No other country of which I am aware comes close to having such a large, permanent, powerful and full time copyright tribunal.

3. Broadcasters pay more for copyright royalties than their counterparts in the USA, much of it for rights that don’t even exist in the USA - for example the “ephemeral right.”The U.S. provides an outright exemption in 17 USC §112 for the “ephemeral right.” Now, about $50-million a year more over and above is being demanded by a collective dominated by the American dominated record labels for this right in addition to amounts now collected by composers, authors and publishers. Canada's Copyright Board heard a major case on commercial radio, where this and other issues will be decided, in December of 2008 and January of 2009. However, it will probably be at least 18 months to two years after the hearing before a decision is announced, based upon the timing of some recent major decisions from the Board.

4. The Canadian Copyright Board values each right under the Copyright Act brought before it separately, with little regard to the layering and multiplicity of tariffs that result, in effect, for the same transaction. Whether this is an error in approach by the Board, and/or in policy, and/or in legislative drafting or at all is subject to fair debate. But the fact is that U.S. law goes to great length to avoid such a result, as recent court decisions have confirmed.

5. Educators pay far more for copyright clearance than their American counterparts. There is simply no mechanism in place in the USA analogous to the excessive $5.16 per K-12 student or the excessive per student and course pack rates payable to Access Copyright for post secondary students. There's a similar mechanism for Quebec. Canada's Copyright Board has pushed back on what it considers to be fair dealing in the class room from what the Supreme Court of Canada arguably requires and American law clearly permits. (The Copyright Board's controversial decision is currently under Judicial Review, in which I should disclose that I am involved).

6. Access Copyright is trying to collect $24 a year for each full time employee in Canadian provincial and territorial governments, not counting Quebec. This is potentially a cost of $6.5 million a year for Canadian taxpayers, which seems absurd in view of the Supreme Court of Canada's CCH v. LSUC decision, since most, if not all, copying of protected material would likely be for research purposes. Nonetheless, a very expensive proceeding will slowly unfold before the Copyright Board and probably beyond into the Courts. Even with an unusual push by the Copyright Board to get this moving, it will likely drag on for years. Such a tariff or equivalent mechanism would never get off the ground in the USA for many reasons, including that state sovereign immunity is well established by the U.S. Supreme Court. There may very well be provincial crown immunity in Canada, but to what extent it will be invoked is currently unclear. At any rate, this new attempted tariff by Access Copyright has no counterpart in the USA and is yet another are in which U.S. copyright owners could prove to be better off in Canada than in their own country.

7. Canadian law requires payment for certain educational uses that are explicitly exempted in the USA, such as the performance of films in a classroom.

8. Canada has no explicit statutory exception for the performance of music for the purpose of selling sound recordings or audiovisual equipment, as is found in §110(7) of the U.S. Copyright Act.

9. Canadians pay large amounts to SOCAN and NRCC for performances in countless bars, restaurants, retail stores, and other small area business establishments. The U.S. notoriously exempts these establishments, contrary to a WTO “Section 110" ruling which the U.S. continues to flout. The U.S. is by far the leading adjudicated current violator of international copyright law.

10. Canada has very inadequate rights in place for distance educators. This results in higher costs and less access to such innovative education, which is the way of the future. The USA has a regime which, though far from ideal, represents a very serious attempt to deal with this new and important phenomenon.

11. Canada has “neighbouring rights.” The U.S. doesn’t. This translates into very big payments for record producers and performers. The Copyright Board has decided that these rights are worth as much in principle as performance rights for composers and authors, which currently generate well over $200 million per year. The limitation on eligibility for foreign neighbouring rights claims - which is probably already subject to much leakage - would simply disappear if Canada ratifies the WPPT.

12. Canadian movie theatres have to pay SOCAN for exhibiting films. NRCC is trying to get the same result. While these rights are normally bought out and cleared for Hollywood productions in the USA, and there is no further requirement to pay ASCAP, BMI or SESAC, Canadian law has thus permitted SOCAN to collect from theatres in Canada for showing the same films. SOCAN collected $881,000 for theatrical exhibition of films in 2005. Though not a huge amount of money per annum, this has been going on for decades. Guess where most of the money goes.

13. Canada has a rich blank media levy scheme that has generated nearly $300 million overall to date, most of which will wind up in the USA. Artists see at most about an average of $160 per year of this - and probably much less in reality on an average basis. The U.S. has never had anything comparable. (I've been involved in this issue for a long time).

14. Canada has moral rights for all types of works, as required by the Berne Convention. The U.S. doesn’t, with the limited exception of visual arts works. Any possible pretence that the USA provides moral rights generally through other means was put to rest by the U.S. Supreme Court in the 2003 Dastar decision.

15. Canada seriously respects the right of independent creators to own their copyright. The U.S. walks all over this with its broad “work for hire” doctrine that favours large corporations.

16. Canada long ago got rid of most of its compulsory licences, including the mechanical license for sound recordings. The U.S. still has this and many more, while it continues to preach to other countries against compulsory licenses.

17. Canada has no parody right/exception for creators and users. In fact, the Canadian Federal Court has explicitly ruled against such a right. On the other hand, the U.S. Supreme Court has confirmed such a right.

18. Canada has no time shifting exception that would clearly allow for legal use of DVRs/PVRs such as the TIVO in Canada. The U.S. has had this since the 1984 Betamax decision from the U.S. Supreme Court. Recent U.S. jurisprudence in the Cablevision case has extended this user right and this technology into “the cloud”.

19. Canada has crown copyright, which leads to all kinds of unnecessary costs and complications for those ranging from advanced researchers to fishermen, who should be able to depend on mapping and GPS information for life saving purposes from the government and not privatized for profit parties. Canada privatizes its government copyright for profit, which cannot happen in the USA. This has not necessarily led to more efficiency. In some cases it has been quite the opposite.

20. Canada has a lower threshold of originality than the USA and provides protection in some instances where the U.S. clearly would not. Canada has no counterpart to the U.S. Bridgeman v. Corel decision denying copyright in photographs of public domain paintings. Nor would a U.S. Court ever confer copyright in the simple idea of including a column of private sale prices for used cars in a three column layout in a booklet of used car prices with no copying of actual data, as the Canadian Federal Court of Appeal did in a 2000 decision that was based upon very inadequate arguments and is inconsistent with other Canadian jurisprudence both before and after, but which has not yet been explicitly overruled.

21. Canada's historic lack of compulsory registration and formal renewal requirements together with our very longstanding life plus fifty term has frequently resulted in a much longer duration of copyright protection for American works than is the case in the USA. A prime example is the music of Irving Berlin. This may be an unusual example because of Berlin's great age and importance, but he outlived his own copyright in his early pre-1923 compositions in the USA. However, copyright in Berlin's music will endure in Canada until 2039 for all of his works. There will also be a longer term in Canada than the USA for many older films that have long since entered the public domain in the USA where the term is normally calculated from the date of publication. In Canada, however, the term of protection is measured in terms of the life of the actual creator(s) plus 50 years.

I would hope that both the Canadian and American Governments are aware or become aware of the above points.

The danger from the “301" process is not so much any kind of retaliation or other direct action, which the WTO has outlawed, not that the USA would necessarily pay attention to that ruling. The real danger is that well meaning but non-expert officials and politicians on both sides of the border and even in other countries may be influenced by inaccurate and/or misleading findings by the USTR resulting yet again from the incessant spin, propaganda and lobbying at any cost by certain U.S. dominated industries. One has to ask what financial return is expected by these industries to justify the clearly enormous spending on Canadian and American lawyer/lobbyist and other high profile activity.

I presented a paper about this at the 2008 Fordham conference entitled: Why Canadian CopyrightLaw Is Already Stronger And Better Than That Of The USA - And Why The USAShould Look In The Mirror Rather Than At Its “Special 301" WatchList.This has only 15 rather than 21 points but more analysis.  


  1. Bravo!

    Well argued. Thank you Howard.

  2. Mr. Knopf: You argue (very effectively) that Canada has a much stronger copyright system than the USA, and generates far more revenue from compulsory licenses, fees and levies (from which the USA receives the lion's share).

    Although this should appease Big Media and the US copyright zealots, surely you're not arguing that these are good things, and beneficial?

    These 21 reasons should probably be used as illustrations of Excess Copyright, and steps should be taken to diminish them for the benefit of Canadian citizens. Reduced copyright will lead to the re-acquisition of our culture.

    Of course, then Big Media and the copyright zealots really will have something to complain about...


  3. 22. Canada's early adoption of the Berne life+50 standard term of copyright duration means that many thousands of works are still copyrighted in Canada, but not in the United States.

    23. The United States' early abolition of perpetual copyright in unpublished works, and the short "transition period", compared to Canada's late abolition and lengthy "transition period" give the United States a large, and growing public domain in unpublished papers. By the end of the decade, it will be larger in scope than that comparable Canadian public domain, and remain that way until 2049.

  4. The term "intellectual property" should never be used, because it
    leads to simplistic assertions such as "intellectual property is good"
    or "intellectual property is bad".

    The term supposedly refers to more than a dozen disparate laws.
    But these laws have nothing in common, practically speaking.
    Thus, generalizing about them leads one to focus on abstractions
    without practical relevance.

    If we want to think carefully about any of these laws, we should
    always discuss them individually, and reject any suggestion to lump
    them together or generalize about them. In other words, it's better
    if we avoid saying anything "about" "intellectual property".


  5. Richard,

    Also nicely said. The differences between the copyright, patent, and trademark law are enormous.

  6. An American here. Really, copyright in the U.S. is too strict as is in my belief. Yes, people should benefit from their works, but ultimately I think a balance for bettering society to the individual's rights over their creation should be created.

    Government, should support the societies greater good, not everyone is so blessed in writing lyrics or books. There are taxes, social services, free (and mandatory) k-12 schooling... It too should free and spread new ideas without prolong charging.

    Then of course we have the extremes. America and "Steam Boat Willy" and Britain with its "Beatles", exceptions extending a rule to the further detriment of society.

    I guess that would make yet another American hypocrisy. :/

  7. While the interim report on copyright from the parliamentary Heritage committee was full of attacks against the Internet and a full spectrum of business models, I will focus on two linked recommendations to illustrate my point. I argue that not only are these recommendations an unnecessary rewrite of the constitution of the Internet, but that this rewrite is inconsistent with recent supreme court rulings, and that such a rewrite would be harmful to the interests of the majority of creators.