Chapter 3 - Key issues
3.1
The committee received evidence covering a wide range of issues and which
provided analysis of the Bill from the perspective of many key stakeholders.
3.2
Evidence was received from groups representing a variety of sectors and
industries, including artists/authors representative groups, corporate rights
holders and distribution industries, copyright-related industries, and
consumers. These groups have generally raised issues and concerns in relation
to aspects of the Bill which most significantly affect their interests. Some of
the groups represented in submissions include: authors; publishers; visual
artists; film industry; music industry; IT industry; television/pay television
industries; libraries; educational institutions; and cultural institutions.
3.3
A number of the broad issues and concerns identified in the course of
the committee's inquiry, including opposing arguments related to particular
aspects of the Bill, are examined below. The vast majority of evidence received
by the committee related to Schedules 6, 8 and 12 of the Bill.
Balancing of interests
3.4
Typically, divergent views emerged with respect to key elements of the Bill
which accord with the interests of particular stakeholders. Generally speaking,
for example, groups representing copyright owners or rights holders tended to
support parts of the Bill which strengthen copyright protection, while often
opposing, or offering only qualified support to, provisions which seek to
create wider exceptions to copyright infringement.[1]
Conversely, those advocating consumer rights and the importance of fostering
creativity and innovation argued that the Bill is weighted towards copyright
owners and rights holders to the ultimate detriment of individual consumers and
the wider community.[2]
3.5
Such opposing views have been recognised by the Federal Government in its
formulation of the Bill:
It is inevitable in making amendments in this area that there
will be areas of disagreement between stakeholders. Not all amendments are well
received by copyright owners and not all are well received by users but, as
ever, one has to balance rights in the public interest and we believe that this
bill goes a long way to achieving that fair compromise and balance. We have
drawn on direct consultations with a wide range of stakeholders including
private individuals, peak groups representing people with disabilities, owners
of copyright works, broadcasters, distributors, copyright collection societies,
academics and those in industry.[3]
Consultation
3.6
In the Second Reading debate, the Attorney-General stated that 'the
(B)ill is a result of extensive consultation and ... delivers on a number of
copyright reviews undertaken in the past few years'. In particular, he noted
that the Bill includes the Federal Government's responses to:
... the fair use and other exceptions review, the review of the Digital
Agenda Act amendments, the review of protection of subscription broadcasts, the
Intellectual Property and Competition Review Committee's review of copyright
under the competition principles, the Copyright Review Committee's review of
jurisdictional procedures of the Copyright Tribunal, the report of the House of
Representatives Standing Committee on Legal and Constitutional Affairs on
technological protection measures, and the technical review of all Australian
legislation to ensure consistency with the Australian Criminal Code.[4]
3.7
The Attorney-General's Department (Department) provided the committee
with a detailed chronology of consultation undertaken by the Federal Government
in relation to various parts of the Bill. This chronology appears at Appendix 3.
3.8
The committee notes that the consultation processes were comprehensive
and wide-ranging in relation to most aspects of the Bill. However, the
committee is mindful of evidence raised during its inquiry which argued that public
consultation has not been adequate in relation to certain specific parts of the
Bill. In particular, submissions and witnesses expressed concern that the Bill
proposes 'unexpected' changes in the following areas:
- introduction of the new tiered system of criminal offences
relating to infringement of copyright, in particular the introduction of strict
liability offences and an infringement notice scheme;[5]
-
introduction of a 10 per cent 'cap' in Schedule 6 in relation to
the current fair dealing exception for research and study purposes;[6]
- a new requirement under subsection 135ZMB(5) in Schedule 8 that
'insubstantial' copying of works in electronic form be 'continuous';[7]
- changes to the 'records notices' provisions relating to the
Copyright Tribunal in Schedule 11;[8]
and
- removal of a 'clear and direct link (contained in the Exposure
Draft) in Schedule 12 between TPM protection and preventing or inhibiting the
infringement of copyright.[9]
3.9
The committee also received evidence suggesting that the 'drivers' for
some provisions of the Bill have not been adequately explained. For example, Ms
Libby Baulch from the Australian Copyright Council (ACC) noted that:
... we do not know what the origins of ... amendments [relating to
format-shifting for books, newspapers, magazines and photographs] are. We were
not able to find those in the issues paper for the fair use inquiry or in the
submissions to it. We have similar concerns about the application of proposed
section 200AB to the activities of educational institutions and libraries where
we have sought some information from government about what sorts of activities
they regard as not being allowed at the moment which they think should be
allowed ... With some sort of explanation like that of the sorts of activities
that they want to address, we may be able to look at better expressed purposes
for this exception to apply ... It is difficult to make alternative proposals if
you do not know what the problem is that these amendments are intended to
address.[10]
3.10
The committee also heard arguments that Parliament's consideration of
the Bill is being rushed.
3.11
For example, Mr Dale Clapperton and Professor Stephen Corones argued
that the only provisions of the Bill 'which have a deadline for implementation,
or could otherwise be considered urgent, are the TPM provisions contained
within Schedule 12'. In their view, the 'remainder of the ... Bill introduces
significant changes to Australia's copyright laws' and 'an unhurried committee
review with sufficient time to conduct meaningful public consultation and
hearings' is therefore warranted.[11]
3.12
Ms Kimberlee Weatherall made a similar argument:
The only parts of this Bill which arguably must pass this year,
in order to ensure compliance with the Free Trade Agreement with the United
States, are Schedules 9 (encoded broadcasts) and 12 (technological protection
measures). In my view, the remainder of this Bill should be deferred so that a
proper analysis and discussion of the provisions can be undertaken.[12]
Department response
3.13
In response to arguments about perceived deficiencies in the
consultation process and the apparent haste with which amendments not related
to the AUSFTA are being considered, a representative from the Department
explained that it is '(t)he government's preference ... to do it as one major
copyright reform bill and to get it all through this year'. She also noted
that, apart from amendments relating to TPMs which are required to implement Australia's
obligations under the AUSFTA:
... there are also some other minor amendments in there that will
allow us to accede to the World Intellectual Property Organisation Copyright
[WIPO] Treaty, and that is a requirement under both the Australia-US Free Trade
Agreement and the Singapore-Australia Free Trade Agreement.[13]
3.14
However, the representative acknowledged that accession to the WIPO
Treaty is an 'indirect' issue; the WIPO Treaty requirements relate to the issue
of 'reasonable portion' and how 'administrative purposes' are defined under the
library provisions of the Bill.[14]
3.15
With respect to the criminal liability provisions (discussed in greater
detail below), the Department informed the committee that 'a range of
consultation' has occurred which 'has identified a number of issues that the
Government is currently considering'. Further, '(t)here would be little value
in delaying the passage of these amendments for any further consultation'.[15]
Schedules 1 and 2 – criminal liability
3.16
Several submissions argued that the Bill's introduction of strict
liability offences for copyright infringement is unprecedented and troubling,
to the extent that Schedule 1 of the Bill should not be passed in its current
form. In other common law countries such as the United Kingdom, Canada and the United
States, offences of strict liability do not exist in copyright law. Significantly,
as Ms Weatherall noted, the AUSFTA does not require the creation of offences of
strict liability for copyright, and offences of strict liability do not exist
in patent or trade mark law in Australia.[16]
3.17
Many expressed the view that strict liability for copyright infringement
should be rejected as a matter of principle. Ms Weatherall argued that ordinary
Australian citizens, engaging in non-commercial activities, should not risk
criminal liability, particularly where copyright infringement has taken place
unknowingly.[17]
Further, Ms Weatherall noted the inherently different nature of copyright
property compared to other forms of property:
Whichever way you look at it, the harm caused by copyright
infringement, while serious in some cases, is commercial, not physical; no one
is permanently deprived of property or the ability to use their property by
copyright infringement, and it is highly questionable whether society
fundamentally condemns unknowing, unthinking infringement of copyright.[18]
3.18
Ms Weatherall pointed to many deficiencies with the proposed criminal
liability provisions, both from a policy level and in relation to their likely
practical impact.[19]
In her view, the reach of the provisions is overly broad and most problematic
where they apply to:
- acts not done for a commercial purpose or in a commercial
context;
- conduct that is a necessary part of conducting ordinary,
legitimate business; and
- acts that might be done by ordinary Australians innocently.[20]
3.19
The Australian Digital Alliance (ADA) predicted that the effect
of the Bill's criminal liability provisions will be that copyright 'crimes'
will be the subject of substantially higher penalties than other property
crimes, in circumstances where the public does not necessarily perceive these
sorts of activities as crimes.[21] According to some, the result will be that many
more people, probably including a disproportionate number of younger people,
will at worst be facing jail time, and at best have their records and career prospects
marked by criminal convictions.[22]
3.20
There was also concern that the strict liability provisions will make
reasonable, good faith commercial activities illegal.[23]
3.21
In the context of educational institutions, the AVCC expressed concern
that the criminal liability provisions may have an unintended impact, namely
that educational institutions might be held strictly liable for inadvertent
acts by their teachers and lecturers, and by students enrolled in educational
institutions.[24]
3.22
On the other hand, the strengthened criminal liability provisions
garnered ardent support from certain sectors. For example, the Screen Producers
Association of Australia (SPAA) commended the Federal Government on the Bill's
measures and argued that, if properly implemented, these changes will make it
harder for commercial scale piracy to take place, and will give film and
television producers greater protection against those who undermine their
business.[25]
3.23
The Australian Recording Industry Association (ARIA), while broadly
supportive of the proposed provisions relating to criminal liability, argued
that in some cases they do not extend far enough. ARIA also expressed concern
that:
... police and prosecutors, given the option, may tend to favour
charging offenders under the summary and strict liability offences, thereby
avoiding the use of the indictable offences, which would amongst other things
require a trial by jury. This is of particular concern to ARIA given the wide
disparity between the penalties for the indictable offences ($60,500 and a
maximum 5 years imprisonment), summary offences ($13,200 and a maximum 2 years
imprisonment) and the on-the-spot fines ($1230). If police and prosecutors do
tend to favor the charging of offenders under the summary and strict liability
offences then the penalties that offenders will face in most instances will be significantly
less than the current $60,500 and a maximum 5 years.[26]
3.24
The Australian Federation Against Copyright Theft (AFACT) expressed
strong support for Schedule 1 of the Bill. It applauded the Bill's introduction
of a new way of dealing with existing offences to recognise that criminal
activity ranges from very serious to lower level matters. In its view, the
particularly beneficial feature of the amendments is that copyright crimes in Australia
are able to be prosecuted according to three tiers of liability which will
enable law enforcement officers to address copyright crime at a level appropriate
to the offence committed.[27]
3.25
At the hearing, Ms Adrianne Pecotic from AFACT provided the committee
with cogent arguments for the inclusion of strict liability offences in the Bill.
In her view, strict liability offences are necessary in the context of
copyright law:
Strict liability is a lower penalty aimed at low-range offences
that equip police to make judgements about the nature of the activity that they
are trying to deal with and make it easy to respond in a measured way to
copyright crimes that are, in many instances, unfortunately out of control in
the Australian environment. The sorts of activities that they are aimed at
addressing are things like low-scale crimes that escalate into organised crime
if they are not stopped at an early stage and the low-scale backyard operator
type of crimes that are spreading out of control in a way that is adding up to
a very significant amount of damage for copyright owners.[28]
3.26
Ms Pecotic did not believe that the strict liability offence would be used
in the case of 'innocuous' purposes unrelated to commercial exploitation of copyright
works.[29]
3.27
The Commonwealth Director of Public Prosecutions (DPP) submitted that
the approach of providing for a range of offences with varying penalty levels
provides 'considerable flexibility and enables charges to be selected based on
the particular conduct that is being assessed'. The DPP noted that the choice
of charge is a matter that is addressed in the Commonwealth's Prosecution
Policy: if, after assessing the evidence, the DPP considers that there is
sufficient evidence to lay charges, the DPP will choose the most appropriate
charge or charges in accordance with that policy.[30]
3.28
At the hearing, the Senior Assistant Director expanded on the DPP's view
of the criminal liability provisions:
From our perspective, we see the amendments to the offence
provisions very much in two ways. Firstly, they clarify the elements of the
offences and the structuring of the offences and, in our submission, very
helpfully set out the elements of the offences, clarify the elements and so on.
We see that as useful.
...
unknown15unknown1Secondly,
we think that structuring the offences in the way that they do—indictable
summary and strict liability, and the addition of the strict liability and
infringement regime—is a very useful adjunct to the criminal offences that are
currently in the Act. We would certainly support that measure as part of the
overall enforcement of copyright.[31]
3.29
The Senior Assistant Director also noted that the proposed strict
liability offences do not alter dramatically the existing offence provisions in
the Copyright Act:
... our support for these is on the basis of ensuring effective
enforcement of the policy objectives that are currently contained in the
Copyright Act rather than on the basis of an extension into new areas in terms
of copyright policy.[32]
3.30
Several submissions and witnesses endorsed the introduction of guidelines
with respect to the management of the strict liability offences and the
infringement notice scheme.[33]
Ms Weatherall suggested that, in developing such guidelines, consultation
should take place with bodies representing those to be regulated under the
proposed provisions, such as the Business Council of Australia, the Law Council
of Australia, and user-interest groups (such as the ADA and the AVCC).[34]
3.31
The committee notes that the Australian Federal Police (AFP) consider
that the amendments proposed in relation to Schedule 2 of the Bill will
provide a more comprehensive range of tools for law enforcement to tackle
copyright offending. The AFP informed the committee that the amendments
will assist it in evaluating the seriousness of copyright matters that are
referred, and in taking appropriate action against matters that are accepted
for investigation.[35]
3.32
The AFP advised the committee that it is still developing an
informed view on Schedule 1 of the Bill.[36]
Department response
3.33
The Department's response to concerns about the proposed strict
liability offences was as follows:
The introduction of new strict liability offences as part of a
tiered offences system is intended to provide police and prosecutors with a
wider range of penalty options to pursue against suspected offenders, depending
on the seriousness of the conduct. By targeting lower level criminal offenders
(eg market sellers), they will significantly enhance the effectiveness of the
enforcement regime and result in stronger deterrence at the lower level.
They will allow a more cost-effective administration of the existing
enforcement provisions by enabling offences to be dealt with expeditiously.[37]
3.34
Further:
The strict liability offences are not intended to target one
particular group of the community and will be applied by law enforcement
agencies in the normal way along with all other criminal offences.[38]
3.35
The Department is aware of other countries that
have introduced administrative penalties which
can be imposed for less serious activities, and noted that there is an
increasing international trend for countries to create a wider range of
penalty options to law enforcement and government agencies in addressing
copyright offences.[39]
The committee understands that administrative penalty systems for copyright are
in place in countries such as Germany, Italy, China, Mexico and the Philippines.
3.36
The Department also informed the committee that
it is not aware of international precedents of strict liability fines with
respect to copyright, particularly in common law countries. However, it noted
that the creation of strict liability offences in Australia underpinned
by an infringement notice scheme for lower level criminal transgressions of
certain regulatory offences is not an unusual feature of Australia's criminal
law system. The Department also pointed out that, in addition, if a person
refuses to pay an infringement notice penalty, they should be liable to face
court only for a strict or absolute liability offence, which is consistent with
recommendations of the Senate Standing Committee for the Scrutiny of Bills and
the Australian Law Reform Commission.[40]
Schedule 6 – Exceptions to infringement of copyright
3.37
Some of the arguments for and against the exceptions contained in
Schedule 6 are outlined below.
Time-shifting – Part 1
3.38
Submissions and witnesses who commented on the proposed time-shifting
exception were generally divided between those who welcome the changes as long
overdue, and those who opposed them as a matter of principle. Some, however,
contended that the Bill provides a broadly balanced approach.[41]
3.39
The Australian Subscription Television & Radio Association (ASTRA)
supported the provisions pertaining to time-shifting, given that they reflect
the daily reality of millions of private households that engage in the copying
of television programs for the purpose of viewing such programs at a more
convenient time. However, it argued that the right to time-shift should be
subject to the exercise of a broadcaster's right to implement a technological
protection measure on their broadcasts.[42]
3.40
SBS supported the time-shifting (and format-shifting) amendment for
private use.[43]
3.41
The Australian Digital Alliance (ADA) argued that the time-shifting
provisions do not go far enough:
The provision does not allow time-shifting of new and emerging
digital forms of technology, such as podcasts and webcats. Rather, the
provision is limited to broadcasts only, and therefore is technologically
specific rather than neutral. This will be confusing for consumers and[,] as
technologies develop and use of podcasts and webcasts become more common[,]
this will lead to disregard for copyright law.[44]
3.42
The Screen Producers Association of Australia (SPAA) expressed its
opposition to the time-shifting provisions. However, it suggested that if they
were to be implemented, a sunset clause on the number of days a copy can be
kept (such as 14 days) should apply.[45]
3.43
ARIA submitted that the record industry considers that there is no
demonstrated need for format-shifting and time-shifting exceptions and that any
such exceptions should be limited so as not to undermine legitimate market
activities.[46]
3.44
At the hearing, Ms Libby Baulch from the Australian Copyright Council
argued that the time-shifting and format-shifting exceptions will interfere
with current and future markets for copyright works and that 'insufficient
regard has been paid to the way that technology and markets are going to
develop'.[47]
Further:
All other developed countries that we are aware of which allow
private copying, including the United States, have levy schemes that ensure
compensation to copyright owners for private copying by consumers.[48]
3.45
According to Ms Baulch, the introduction of exceptions for time-shifting
and format-shifting, without corresponding compensation for copyright owners,
does not meet the three-step test contained in international treaties such as
the Berne Convention.[49]
3.46
Such arguments were supported by others. Mr Michael Fraser from the
Copyright Agency Limited (CAL) agreed that copyright owners should be
compensated alongside any broadening of copyright exceptions, particularly in
the context of the emerging digital download environment:
If one institutes a free exception then copyright owners are
going to be very concerned about whether it is one person or 14 days or their
family or whether they are allowed to make a backup copy. But if one has a
broad principle that these kinds of users should be permitted in return for a
reasonable return, which can be subject to the Copyright Tribunal, say, then
trying to shape up the exact framework of the market no longer becomes a
question, because you leave it to the market to develop under a broadly based
three-step test exception.
The problem now is trying to delineate a market which is in the
process of forming. By doing that without compensation you prevent that market
from developing at all—copyright owners will not invest in making these very
services available. So compensation I think is the linchpin ... [A]ll those
countries that value their creative industries that make an exception for
private use provide for payment to the copyright owner for what is a large part
of their developing online markets.[50]
3.47
Mr Fraser argued further with respect to the digital environment that
there are problems in trying to create exceptions to deal with a market that is
still in a state of development:
We are getting to the point of how many angles on the head of a
pin in trying, very early in the digital revolution, to extend fair dealing
exceptions to private use, library use, private copying—trying to shape up a
market that is in a state of incredible creativity itself ... [It is difficult] to
say what exception should be allowed for free and what exception should be
allowed but paid for and to say where the market now exists. Where the market
will be in six months is going to be very different from where it is now. Our
members are very keen to provide the very services that these exceptions are
designed to ensure.[51]
Department response
3.48
In response to questioning by the committee in relation to uncertainty about
use of the term 'domestic premises' in proposed paragraph 111(1)(a), a
representative from the Department informed the committee that, while there is
an obligation to make a recording in domestic premises, there is no restriction
on where a person watches or listens to the recording. The phrase 'private and
domestic use' in proposed paragraph 111(1)(b) is not intended to restrict
people to watch or listen to recordings in their own homes. The departmental
representative noted that there is no definition of the term 'domestic
premises', however he stated that:
I would have thought the term 'domestic premises' was going to
be fairly obvious in most circumstances. You may be able to find spots around
the edges where you might have a bit of doubt, but for most people it will be
fairly clear what their domestic premises are. I believe that term is used in
the current UK provision which permits time-shifting and we are not aware that
that has caused any great confusion in the UK.[52]
Format-shifting – Part 2
3.49
The Media Entertainment & Arts Alliance noted that Australia would
be the only country in the developed world to introduce a format-shifting
exception to the protections afforded copyright owners without simultaneously
introducing a system of equitable remuneration to those copyright owners.[53]
3.50
The Australian Society of Authors submitted that the proposed 'format
shifting' exception should not apply to books at this stage but instead be
monitored and reviewed in two years time with respect to audiovisual material;
its view was that some of the proposed exceptions to copyright infringement may
impede or interfere with emerging markets in the digital environment.[54]
3.51
The Screen Producers Association of Australia expressed its opposition
to the proposed format-shifting provisions, arguing that they inhibit the
exploitation of markets which still exist for copyright owners.[55]
3.52
Viscopy (representing the copyright interests of visual artists) also opposed
the introduction of the format-shifting exception. In its view, the
justification for copying books, newspapers, periodicals and photographs, in
particular, is not clear.[56]
3.53
The Internet Industry Association noted the potentially limiting nature
of the proposed exceptions in their application to the digital environment:
... the supposed introduction of a more flexible regime for the
use of new digital devices seems to have resulted in narrowly confined
exceptions, which are not only likely to become dated (due to their
technological specificity) but also may not deliver the legitimacy to common
activities for which they are intended. The 'main copy' rule in relation to MP3
players has failed to take into account the actual method by which format
shifting occurs, with the result that the use of iPods, for example, for most
Australians will remain in breach of the [Copyright] Act.[57]
3.54
A number of submissions commented on the Bill's failure to cover the use
of iPods, which require the making of more than one permanent copy of a sound
recording to work.[58]
The restriction in proposed paragraph 109A(1)(e), that an individual can only
make one copy in any given format, means that if an individual makes an MP3
copy to put in their iPod, then they cannot also keep the MP3 copy on their
laptop.
Department response
3.55
The Department is aware of concerns raised in relation to
format-shifting, particularly in the context of the Bill's perceived failure to
adequately deal with legitimate use of iPods. The Department justified the present
drafting of the format-shifting provisions as follows:
The present conditions for format-shifting of sound recordings
allow the owner to make one copy in each different format. There are good
reasons for this. The exception is not intended to be an open-ended licence
that allows a person who buys one copy of a sound recording to make unlimited
copies. The 'one copy in each format' condition is to protect copyright owners
from this exception being abused, as well as to ensure that the exception
complies with the three-step test. In effect, this condition will limit a
person to making one copy for each playing device that uses a different audio
format to that of the original sound recording.[59]
3.56
The Department clarified that the current drafting recognises that, in
transferring music from a CD to a portable playing device, it is necessary to
make an 'intermediate' copy in a personal computer. However, section 109A
requires that this intermediate copy should be deleted after the transfer is
completed.[60]
3.57
The Department pointed out that the Attorney-General noted in his Second
Reading Speech that the Federal Government will listen to, and consider,
relevant comments related to this issue, and make any necessary technical
changes to ensure that the Bill achieves the Federal Government's
objectives in this area.[61]
The committee welcomes this undertaking.
Use of copyright material for
certain purposes – Part 3
3.58
The committee notes that exceptions and limitations to the rights of
copyright owners must comply with Australia's international treaty obligations.
The provisions in these treaties provide for a 'three-step test' for permitted
exceptions: limitations or exceptions to exclusive rights should only be in certain
special cases which do not conflict with a normal exploitation of
the work and do not unreasonably prejudice the legitimate interests of
rights holders.[62]
3.59
The committee received evidence which highlighted opposing views on how
the three-step test should be implemented in domestic legislation. Proposed
section 200AB seeks to provide an open-ended exception in line with the US
model, and to allow courts to determine if other uses should be permitted as
exceptions to copyright. Some particular concerns were raised in relation to
the Bill's approach to the three-step test.
3.60
The Australian Publishers Association (APA) noted several drafting
issues with respect to proposed section 200AB. For example, the APA pointed to
the likely uncertainty as to the scope of the new exceptions until case law is
developed to interpret the open-ended exception. The APA commented that the
move by the Federal Government towards 'a lawyer-based copyright regime – a
litigious model – instead of staying with a regime based on clearer legislative
exceptions' is 'odd'.[63]
3.61
The ADA and the Australian Libraries' Copyright Committee (ALCC), on the
other hand, expressed the view that proposed section 200AB is unnecessarily
limited by the 'commercial advantage' test which is unclear in meaning.
Further, the requirement that the provision be limited to 'certain special
cases' within the scope of the special cases of education, library and archive
uses, parody and satire and uses for people with disabilities, confuses the
meaning of the provision. According to the ADA and the ALCC, this additional
limitation is not required by the three-step test or indeed the AUSFTA.[64]
3.62
Others disagreed with this approach. For example, the International
Association of Scientific, Technical & Medical Publishers argued that the
three-step test demands that all exceptions be subject to the three-step
test.[65]
Similarly, CAL argued that 'there is inherent confusion in the approach of
combining explicit recognition of the three step test in one exception with
other exceptions in the [Copyright] Act'.[66]
Department response
3.63
A representative of the Department commented on the Bill's
implementation of the three-step test as follows:
... we are aware that there are a range of views ... including [in
relation to the inclusion of the 'commercial advantage'] condition in the new
200AB. We are aware that some user interests think that it is unduly
restrictive. Given that the three-step test already has to be complied with,
there is an argument that should be enough, that the government should go as
far as the three-step test allows. But we note in passing that the three-step
test is not an obligation; you only have to go as far as you can go under the
treaty obligations. The government is also aware that some copyright owner
interests think that the provision is too broad and that the commercial advantage
test should be narrowed even further. In the present drafting the government
has sought to find a balance between those interests, recognising that this is
a new exception that is different in form to some of the specific exceptions
already in the Copyright Act. Therefore, the government is minded to try to
balance what are reasonable interests on both sides—the copyright owners and
users.[67]
3.64
Further:
The first part of the 'three-step' test requires that an
exception must be limited to 'certain special cases'. Other types of exceptions
(both in Australia and in other jurisdictions) set narrower conditions than
simply that the use is for a particular purpose or by a particular person or
organisation, for example, by a library. Those exceptions generally allow use
of identified copyright material for a particular purpose, subject to various
other conditions or limitations. In total, all
the legislated conditions will define 'cases' which are more certain but are
very restricted.[68]
3.65
In relation to concerns raised about the 'commercial advantage' test
contained in elements of proposed section 200AB, the Department noted the
differences in opinion between copyright user interests and copyright owners or
rights holders:
This condition is questioned by some copyright user interests as
unnecessary because s 200AB already requires that a permitted use must comply
with the three-step test. It is argued that the three-step test provides all
the protection for copyright owners required by international treaty obligations.
User interests also contend that a 'commercial advantage' condition is too
restrictive and uncertain given that institutions may charge instructional fees
or engage in money rasing activities.
The Government introduced the 'commercial advantage' test in
recognition of concerns about the potential scope of the new exception. Indeed
the Government notes arguments on behalf of some copyright owners that s 200AB
is presently too wide in being potentially available to for profit schools and
libraries in commercial companies and should be narrowed so that no commercial
advantage, direct or indirect, can be obtained from reliance on this section.[69]
3.66
The Department acknowledged that the current form of proposed section
200AB was an attempt to balance these competing interests by indicating that
the prohibition on gaining a commercial advantage should not necessarily
prevent cost recovery by an eligible institution or person.[70]
Exception allowing use of copyright
materials for parody or satire
3.67
Some submissions and witnesses commented specifically on the exception
relating to use of copyright material for parody or satire.
3.68
ASTRA submitted that the elements of satire and parody are valid forms
of expression that are recognised within the fair use doctrine established by
US courts and (save for satire) in the European Union Information Society
Directive (Article 5(3)). It supported the extension of the fair dealing rights
to include these forms of expression, arguing that the Bill will create greater
certainty for copyright users while not diminishing the rights of copyright
owners.[71]
3.69
On the other hand, the Copyright Agency Limited (CAL) offered qualified
support for the inclusion of an exception for parody – as long as it does not
conflict with the ability of copyright owners to license such uses. CAL did not
support the extension of the exception to cover satire.[72]
3.70
While commending the inclusion of satire and parody as exceptions, the
ABC and SBS argued that the use of the three-step test to qualify the parody or
satire exception is a wrong application of the test. As SBS explained:
The "three step test" under copyright treaties such as
Berne and TRIPS is appropriate to consider when deciding whether to introduce
a new, previously unspecified exception. It is not appropriate as an internal
limitation in a national Copyright Act to an already specified exception. For
example, the application of the first limb of the three step test to parody or
satire (in subsection 200AB(1)(a)) effectively requires the court to find a
"special case within a special case".
To our knowledge no other jurisdiction applies the "special
case" test internally within its legislation for the parody exception. Nor
does the "special case" limitation apply to any other exception
within our Copyright Act. [73]
3.71
SBS argued that parody or satire should be placed in the fair dealing
exceptions alongside related exceptions such as criticism and review.[74]
Department response
3.72
The Department informed the committee that it is considering the removal
of the exception for parody and satire from proposed section 200AB and, instead,
adding new exceptions to Parts III and IV of the Copyright Act to provide that
a fair dealing with a work or other subject matter for the purpose of parody or
satire is not an infringement of copyright.[75]
Limitation on 'fair dealing'
exception for purposes of research or study – Part 4
3.73
Many submissions and witnesses expressed concern at the Bill's
limitation on copying for the purposes of research and study to a 'reasonable
portion' (10 per cent or one chapter) of a published literary, dramatic or
musical work.
3.74
The Law Council of Australia submitted that there is no reason to change
the current exceptions in the Copyright Act related to fair dealing as they
already adequately cover the relevant subject matter.[76]
3.75
The Flexible Learning Advisory Group argued that the Bill proposes a
radical and unwarranted departure from the existing fair dealing regime which
will dramatically curtail the fair dealing rights of students and academics.[77]
3.76
Ms Weatherall noted the apparent disparity between the Bill, on the one
hand, allowing format-shifting and time-shifting without a quantitative limit
(to consume media, a person may copy the whole work) and, on the other,
imposing a quantitative limit (10 per cent) on copying for research and study.[78]
3.77
Ms Sally Hawkins pointed to the inconsistency between copying for
personal purposes and copying for research or study purposes:
Changes to the law in relation to education include the
restriction of fair dealing for research or study with a stricter adherence to
the 10% copying rule, this means that a person can make a full copy of a book
for personal purposes but can't make more than 10% of a copy for research
purposes. This is ridiculous. There should be absolutely no limitation on the
quantity of material that can be copied for research purposes. It is against
the wider public interest that such a limitation exists in the first place and
stupidity that it should be reinforced any further.[79]
3.78
The ADA and the ALCC submitted that the narrowing of fair dealing for
research and study will seriously disadvantage libraries and cultural
institutions and particularly their clients 'who will not be able to copy rare
or out of print materials to take away with them for research or study
purposes, despite the fact that those materials are not commercially available'.[80]
Department response
3.79
The Department indicated that it is considering a possible redraft of
the amendments relating to fair dealing for the purposes of research or study:
To overcome misunderstandings apparent from several submissions
to the Department and to the Senate Legal and Constitutional Affairs Committee
about the intended effect of the amendments, there may be redrafting of
amendments to section 40 (fair dealing for research or study) to clarify the
intended effect, which is that the reproductions deemed to be fair
dealings will be slightly restricted but without affecting in any way
the scope of the provision allowing any other amounts of reproduction if considered
to be fair.[81]
3.80
The Department explained that the Federal Government's decision to limit
the quantity of copying of a work that is, under section 40, deemed to
be fair dealing is based on amendments necessary to enable accession to the
WIPO internet treaties (WCT and WPPT). The Department also noted that Australia
is required under the Singapore and AUSFTA to become party to those WIPO
Treaties.
3.81
According to the Department, there must be appropriate limits to
unremunerated copying automatically allowed under section 40 to ensure
compliance with the three-step test in the Berne Convention and the WCT.
3.82
For the purposes of deemed fair dealings under the new section
40(5), it is intended that the quantification of reasonable portion in subsections
10(2) and 10(2A) should be exhaustive in relation to the works which they cover
(that is, literary works, dramatic works and musical works in hard copy, and
literary and dramatic works in electronic form, in both cases excluding
computer programs and electronic databases.)
3.83
The Department advised that greater amounts of copying of any work for
research or study will still be allowed under subsection 40(1) if a court judges
the copying to be fair, having regard to the matters listed in subsection
40(2); both those provisions are unaffected by the amendments in the Bill.[82]
Official copying of library and
archive material – Part 5
3.84
The Copyright and Cultural Institutions Group (CCIG) applauded the
intent behind the exception applying to cultural institutions. However, it
argued that there is a lack of certainty in terms and terminology used in the Bill
which undermine the usefulness of the exception. In particular, the exception's
limitation on one copy/reproduction does not accord with the technical
processes of preservation.[83]
3.85
The National Library of Australia submitted that the Bill does not make
adequate provision for the preservation of digital works and creates a
significant impediment to the preservation of commercial works in digital form.[84]
3.86
The ADA and the ALCC noted that 'whatever the policy intentions of the
Government may be, the result of the legislation will be that many practices
which cultural institutions undertake in order to fulfil their mandates, will
remain technically in breach of the law'.[85]
The ADA and the ALCC also noted that best practice standards for preservation
recommend that 'multiple copies' be made and stored in different locations. For
example, the UNESCO Guidelines for the preservation of digital heritage
recommend 'multiple copies'.[86]
3.87
The ABC and SBS both expressed concern that they, as national
broadcasters and holders of valuable audio and audio-visual cultural material,
may not be covered by the Bill's definition of 'cultural institution'. They
argued that they should be specifically included in the concept of 'key
cultural institution'.[87]
The Australian Film Commission also argued that it should be deemed a 'key
cultural institution' for the purposes of the exception.[88]
Department response
3.88
The Department provided advice to the committee indicating that the term
'first copy' in proposed section 110BA of the Bill will be clarified in further
drafting changes.[89]
However, the committee is unsure of the extent of this clarification and
remains concerned that the scope of the proposed provision may still not be
wide enough to capture ordinary preservation processes undertaken by cultural institutions.
While the committee understands that multiple copies for the purposes of
preservation may be allowed under the specific exception for libraries and
archives in proposed section 200AB, the committee considers that this should be
made absolutely clear in the Bill.
Schedule 8 – Responses to Digital Agenda review
3.89
A number of concerns were raised in relation to proposed sections 28A
(communication of works in the course of educational instruction) and 200AAA
(caching on a server for educational purposes).
3.90
In relation to proposed section 28A, some argued that, as currently
drafted, it might inadvertently operate to exempt from copyright obligations a
variety of communications which are currently, and should clearly be, regarded
as communications to the public, and which are therefore covered by the
educational statutory licence in Part VA of the Copyright Act.[90]
3.91
On the contrary, CAG argued that the range of copyright material covered
by section 28A does not correspond with the range of copyright material
currently covered by section 28 of the Copyright Act. According to CAG, the
practical effect of this will be that schools will be able to use new
technologies for some kinds of copyright material but not others.[91]
3.92
Some also argued that proposed section 200AAA appears to provide a
virtually blanket exemption to educational institutions to download and
communicate material from the Internet, and then to keep that material for an
unlimited period of time. This could have the effect of allowing the continuous
caching of Internet content and may potentially undermine licensing
arrangements.[92]
Some also argued that this conflicts with the three-step test. As the
Australian Publishers Association argued, '(i)t is difficult to see that there
is a special case, the activity conflicts with a normal exploitation of the
work and would unreasonably prejudice the legitimate interests of the rights
holder'.[93]
3.93
The Business Software Association of Australia (BSAA) argued that the
words of proposed section 200AAA appear to extend far beyond active caching of
websites. It expressed concern that the exception, as drafted, could be used to
justify downloading a copy of a computer program onto a server and making it
available to students for the purposes of an educational course. This would, in
turn, have the effect of severely damaging the educational market for software
companies and would jeopardise the heavily discounted pricing on products
offered to educational institutions.[94]
3.94
The International Intellectual Property Alliance (IIPA) argued that the
'most troubling feature' of proposed section 200AAA is that:
... it appears irrelevant whether a voluntary license – or for
that matter a statutory license – is already available, or even already in
force, under which the educational institution would be able to make the use
but would have to pay for it.
...
... there is certainly a strong argument to be made that in its
current form, Section 200AAA threatens to conflict with the normal exploitation
of works which are already available to educational institutions under licenses
that could cover the use labeled as "active caching." Indeed, one
wonders why an educational institution would ever enter into such a license in
the future if Section 200AAA were enacted.[95]
3.95
Conversely, educational institutions and other groups representing
consumer interests have argued that the exemption in proposed section 200AAA
does not go far enough. They argued that the proposed section, while clarifying
the position of active caching for educational purposes, does not provide for
the most common form of caching which occurs widely for Internet efficiency
purposes in a broad range of organisations that provide Internet access –
namely 'passive' or proxy caching.[96]
3.96
The Australian Vice-Chancellors' Committee (AVCC) noted that some
copyright owner groups, such as the Copyright Agency Limited, have argued that
caching for these purposes does not come within the temporary copy exception
contained in section 43A of the Copyright Act.[97]
However, the AVCC noted that no court appears to have determined that this is
so. In any case, uncertainty regarding the legal status of such caching is a
matter of great concern to educational institutions due to the risk of being
sued for copyright infringement in respect of caching and having to engage in
the expense of defending such a claim.[98]
3.97
The AVCC understands that the Federal Government intended that proxy
caching does come within the exception contained in section 43A. It argued
that, if this is the case, some words to this effect in the EM would put beyond
doubt that caching of this kind does not infringe copyright. If the Federal
Government is not minded to make such a statement, the AVCC urges that the proposed
education sector caching exception be broadened to ensure that it can be relied
on by educational institutions in respect of forward or proxy caching.[99]
3.98
As Ms Anne Flahvin from the AVCC explained at the hearing:
What we are saying is that there needs to be some clarification
to ensure that, when we cache for the purposes of efficiency, cost savings,
technical efficiency or efficient use of bandwidth, we are not infringing
copyright.
...
... the reasons we need to go out on a limb is that we are about
the only place in the world that I know of where there has been a suggestion
that caching for efficiency purposes exercises a right of copyright.[100]
3.99
Screenrights (the Audio Visual Copyright Society) and the Copyright
Advisory Group to the Schools Resourcing Taskforce of the Ministerial Council
on Education, Employment, Training and Youth Affairs (CAG) provided the
committee with a joint approach to overcome some of their perceived concerns in
relation to proposed sections 28A and 200AAA. While their concerns differ – Screenrights
is concerned that the proposed sections go beyond the specific policy
intention, and CAG is concerned that they do not clearly cover some particular
uses mentioned in the EM – they have identified possible solutions which they
believe address each of their concerns.[101]
3.100
As Mr Simon Lake from Screenrights told the committee:
Within the submission, ABC, SBS, APRA, the Screen Producers
Association of Australia and other copyright interests have all had a look at
this. One of the things they have said is that, whilst, again, they do not love
the policy behind it, they think that what we have proposed is a workable
solution. They have also commented that they think it is a good thing that the
schools and Screenrights, as the copyright representative, are working together
to get those shared solutions. We have shown it, and the response has been
positive.[102]
3.101
CAG and Screenrights' suggested solution to the problem is to delete
proposed section 28A and to create a new subsection to section 28 to exempt communications
made merely to facilitate a performance under section 28. They believe this
approach meets their stated policy intention, and also addresses their
concerns.[103]
Department response
3.102
The Department informed the committee that it is considering changes to
address the concern expressed by copyright owners and educational bodies that,
as drafted, section 28A goes further than current section 28 and extends to
general exercise of the communication right. The Department acknowledged that
this is unintended. It is proposed to amend the drafting of section 28A to deem
a communication of a work or subject matter, other than a work in the
circumstances of subsections 28(1) to (4) inclusive, not to be a communication
to the public.[104]
3.103
With respect to the caching issue, the committee notes advice from the Department
that it is considering drafting changes to proposed section 200AAA to clarify
that caching for efficiency purposes does not infringe copyright; and to ensure
that there is no doubt that the reproduction must be removed after the end of
the particular educational course for which it was made. The Department also
informed the committee that it is proposed that copies should be destroyed
within 14 days of the end of a course. Such destruction could be by either
direct human intervention or indirectly by an automated process.[105]
3.104
In order to address the fact that a copy of a cached or copied website
resides in cache or storage after it is deleted, the Department noted that subsection
200AAA(3) could provide that subsection 200AAA(2) does not apply unless the
reproduction is destroyed or access to the copy removed, rather than requiring
the copy to be removed.[106]
Schedule 12 - Technological protection measures
3.105
The committee notes the complex and technical nature of the Bill's provisions
relating to TPMs.
3.106
Some submissions and witnesses expressed strong support for the
provisions as a means of preventing copyright infringement and ensuring that
copyright industries can continue to invest in the innovative delivery of
copyright products to Australian consumers.[107]
3.107
However, the committee also received evidence that the proposed changes
to copyright law in respect of TPMs would be significantly detrimental to some
industries and to consumers.[108]
3.108
Others raised concerns with particular aspects of these provisions. For
example, some submitted that the Bill's definition of 'technological protection
measure' is undesirably broad, confusing, and is inconsistent with the AUSFTA,
the WIPO Copyright Treaty, the WIPO Performances and Phonograms Treaty, and
Australian case law.[109]
The Business Software Association of Australia commented on the offences
relating to TPMs, noting that, as drafted, they limit the capacity of law
enforcement to respond in an appropriate way to the severity of an infringement
of the Copyright Act because they do not enact the full range of offences –
indictable, summary and strict liability – that have been developed for the
non-TPM offences in the Copyright Act.[110]
3.109
In their submission, Mr Dale Clapperton and Professor Stephen Corones
from the Queensland University of Technology argued broadly that the anti-circumvention
provisions of the AUSFTA, as implemented by the Bill, will have a far broader
effect in Australia than in the United States due to, in part, disparity in the
protection for functional elements of computer software, and the lower standard
of originality in Australia. Significant differences in the exceptions to
copyright between the two countries exacerbate the problem.[111]
3.110
Electronic Frontiers Australia (EFA) pointed to Schedule 12 having
undergone 'serious and fundamental changes' from what was contained in the
Exposure Draft of the Bill. It argued that these changes 'were unannounced,
unexplained, and only came to light after doing a side-by-side comparison' of
the provisions of Schedule 12 and the Exposure Draft.
3.111
EFA submitted that, in its view, the anti-circumvention provisions of
the Exposure Draft contained a clear and direct link between TPM protection and
preventing or inhibiting the infringement of copyright. Such a link was
recommended by the House of Representatives Standing Committee on Legal and
Constitutional Affairs report into TPM exceptions. Despite this recommendation,
and the government accepting the recommendation in their response to that
committee's report, this 'vital link' has
been abandoned in the Bill.[112]
3.112
Similar arguments were raised by others in relation to the absence of
the incorporation of a link to preventing or inhibiting copyright infringement.
At the hearing, Professor Brian Fitzgerald and Mr Dale Clapperton contended
that the correct interpretation of Article 17.4.7 of the AUSFTA requires a
direct link between any effective TPM and the prevention of copyright
infringement. They argued that this interpretation is consistent with the initial
wording in the Exposure Draft which has been replaced with the words 'in
connection with the exercise of copyright' contained in the current version of
the Bill. In their view, this new wording could 'arguably be interpreted to
allow almost any restriction imposed by the copyright owner' to be protected by
anti-circumvention law.[113]
3.113
Professor Fitzgerald and Mr Clapperton also argued that this
interpretation aligns with the interpretation of the AUSFTA put forward by the
Attorney-General's Department before the House of Representatives Legal and
Constitutional Affairs Committee inquiry into TPMs held in 2005, that
committee's findings in that inquiry, the Federal Government's acceptance of
relevant recommendations in that inquiry, and current US case law.[114]
3.114
Many also pointed to the Stevens v Sony case[115]
which also emphasised the need to link any TPM protected by the Copyright Act
to the prevention and inhibition of copyright infringement, and where the High
Court cautioned against allowing copyright owners to use copyright law to
further 'non-copyright' agendas'.[116]
3.115
In this vein, Professor Fitzgerald argued that copyright law is not
appropriate to effectively provide legislative protection for business models
and endorse a preference in the marketplace for certain business activities:
Australian consumers, once they lawfully purchase a copyright
item, have the right to use that item subject to controls that limit or prevent
copyright infringement. Copyright infringement should be the touchstone of
technological protection measures protected under the Copyright Act. If they
are to be protected at all for other reasons, we should be looking at them
under the other particular heads—whether it is consumer legislation or whether
it is content legislation—but not under the Copyright Act.[117]
3.116
However, others expressed strong disagreement with this argument. For
example, Mr Maurice Gonsalves from the Interactive Entertainment Association of
Australia argued that 'there is no link to copyright infringement, and that
link is not in the [AUS]FTA, in US law or in the law of most other
jurisdictions'.[118]
Mr Gonsalves was of the view that, in the online environment, where a
copyright owner is exercising the copyright owner's right of communication to
the public:
... there is no other way of protecting the
copyright work other than using the technological protection measure. So
without protection like this, that potential distribution model is eliminated
altogether potentially—which is detrimental to consumers because those models
will not evolve.[119]
3.117
A number of submissions commented on the exceptions to circumvention of
TPMs contained in the Bill. In particular, there was concern that the
provisions of the Bill dealing with TPMs might be used to prevent the
interoperability of data or the creation of software programs which can access
other people's data.[120]
There was also concern that the exceptions would not be wide enough to prevent
anti-competition uses of TPMs.
3.118
As Mr Brendan Scott from the Open Source Industry Australia argued:
We are very concerned that it does raise competition issues
under the TPM provisions. We are concerned that they can be used to lock
customers out of their own data or to require customers to be locked into a
specific vendor. We were hoping to find an exception in the permission
provision, which says that if you are the copyright owner you can give
permission. But the issue for us there is just because I save a document it does
not mean that I am the only person who owns copyright in the saved document.
And that flows on to our main concern which is the interoperability exception.[121]
3.119
The Open Source Industry Australia contended further that the absence of
a clear exception for interoperability to permit access to a customer's data
would 'pose a substantial threat to our member's ability to compete in the
software market' and would have 'a substantive adverse effect on competition
and innovation'.[122]
3.120
There was also some concern with respect to the absence of a permission
exception in Schedule 12. Ms Carolyn Dalton from CAG explained the potential
problem as it applies to the education sector:
In the TPM provisions in relation to the ban on the use of a
circumvention device, there is an exception there that says you can circumvent
if you have the permission of the copyright owner. In relation to the other set
of bans or criminal and civil provisions in relation to dealings with
circumvention devices—for example, sale, manufacture etcetera—there has not
been that exception for permission translated across. So if, for example, in a
school or a university you have been given the right to use a circumvention
device, there is no equivalent exception to enable the sale or manufacture so
that someone can sell you a device to use that exception. We understand that that
is a requirement of the free trade agreement ... but the absence of a permission
exception means that the school or university cannot even contact the copyright
owner. They cannot pick up the phone and say, 'Would you mind?' We think that
is an interesting gap, because it can effectively mean that the provisions that
have been given to educational institutions to use these devices might not be
workable even in the context where specific permission has been sought from the
copyright owner to undertake such acts.[123]
Department response
3.121
The Department responded to some of the issues raised by submissions and
witnesses with respect to the TPMs provisions. In relation to arguments that
the current version of Schedule 12 removes the link to copyright infringement that
was contained in the Exposure Draft, a representative of the Department
explained that Article 17.4.7 of the AUSFTA 'requires liability for TPMs to be
independent of copyright infringement'.[124]
She told the committee that the Federal Government's view is that the AUSFTA 'clearly
states that the TPM liability that we provide should be independent of whether
copyright infringement has occurred'.[125]
3.122
The representative also noted that there has not been a significant
change between the Exposure Draft of the TPMs provisions and the current Bill.
She explained that certain interpretations of the Exposure Draft did not
reflect the Federal Government's intention:
The intention of the exposure draft was to provide liability
where there was a possibility that copyright infringement might occur, and it
did not look at a particular situation as to whether an exception under the
Copyright Act would have applied. It was an objective test. The government's
intention in the exposure draft was not read by the public. In the submissions
we saw that there was a lot of confusion about the government's intention. Both
users and owners sought greater clarity and simplicity in the operation of the
definitions. They also sought greater certainty in the issue of geographic
market segmentation. The drafting approach in the bill is the government’s
response to those concerns.[126]
3.123
Further:
It is my understanding that those interpretations would have
resulted in Australia not complying with the free trade agreement. That
understanding meant that you had to show infringement of copyright for TPM
liability to exist. In moving from the government's intention in the exposure
draft to where we are today in the bill, it is simply an attempt to provide
clarity and simplicity in the operation of the definitions and to move away
from the legislative notes that addressed the region coding issue to
substantive provisions in the act that address market segmentation and
anticompetitive use of aftermarket materials.[127]
3.124
With respect to a possible additional exception to TPMs liability for
educational institutions to allow them to provide circumvention devices to
other institutions, the Department informed the committee that this would not
be possible under the AUSFTA:
... the Australia-United States Free Trade Agreement (AUSFTA)
places clear boundaries on the manufacture and supply of circumvention devices
for other people. This is a necessary measure in order to discourage piracy.
The effect of this limitation in the AUSFTA is that there is no
scope for the Government to introduce an additional exception to liability for
educational institutions to allow them to provide circumvention devices to
other institutions.[128]
Committee view
3.125
The committee acknowledges the vast amount, and comprehensive nature, of
evidence it has received in the course of its inquiry. This evidence has
greatly assisted the committee in its deliberation of the issues raised by the Bill,
particularly given the short timeframe within which the committee has been
required to undertake its inquiry. The committee also notes the complexity of copyright
law and the issues raised by the Bill which, in the context of the short
timeframe, has made the committee's task challenging.
3.126
The committee notes the importance of balancing the interests of various
stakeholders and recognises the difficulties in achieving such balance in the
area of copyright law. The committee acknowledges that the Government has endeavoured
to ensure that there continues to be strong economic incentives for the
creation of new material to protect copyright, while at the same time providing
greater recognition to the interests of consumers to reasonably use copyright
material that they purchase or legitimately access. The committee considers
that, on the whole, the Bill represents a balanced approach between all
competing interests.
3.127
Nevertheless, the committee is inclined to make suggestions which it
considers may help clarify some of the remaining areas of contention, as well
as address uncertainty with respect to certain aspects of the Bill and their
likely impact. In doing so, the committee notes that many of these suggestions
are already in the process of being considered by the Department, and by the
Attorney-General.
Strict liability provisions
3.128
In particular, the committee agrees with arguments raised in relation to
the proposed strict liability provisions that there is merit in attempting to
limit the scope of these provisions to the actual activities that the committee
understands they are intended to target. The committee is of the view that the
strict liability provisions could be narrowed in a way that would significantly
reduce the risk of their application to ordinary Australians and legitimate
businesses. The committee therefore recommends that the Federal Government examine
the possibility of narrowing the strict liability offences in such a way. The
committee considers that one possible approach to concerns raised in relation
to innocent and misguided infringements of copyright might be to introduce a
'first infringement' or 'warning' scheme where only a subsequent infringement
of the same kind might carry the current proposed levels of penalty.[129]
3.129
The committee also supports the introduction of guidelines relating to
management of the strict liability offences and the infringement notice scheme,
and agrees with suggestions that consultation should take place with
appropriate bodies in the development of those guidelines. The committee
considers that this should occur prior to Schedule 1 being implemented.
3.130
Further, the response from the AFP indicated that it is yet to develop
an informed view on Schedule 1. In any case, in accordance with the AFP's Case
Categorisation and Prioritisation Model, these types of offences may be categorised
as 'low' impact.
Time-shifting
3.131
The committee considers that the meaning and scope of the terms
'domestic premises' and 'private and domestic use' in proposed subsection
111(1) is unclear. The committee recommends that proposed subsection 111(1) be
re-drafted to make absolutely clear that individual consumers are not
restricted to watching and listening to recordings in their own homes.
Format-shifting – use of iPods and
similar devices
3.132
The committee also notes concerns raised by submissions and witnesses in
relation to the proposed exception for format-shifting, particularly as it is
likely to impact upon legitimate iPod use. The committee considers that all
aspects of the use of iPods and similar devices, which includes storage of
music collection libraries on personal computers, should be included in the Bill.
The committee suggests that the Federal Government amend the Bill to recognise
the ordinary use of iPods and similar devices by consumers.
Fair dealing for research and study
3.133
The committee expresses concern at the Bill's limitation on copying for
the purposes of research and study to a 'reasonable portion' (10 per cent). The
committee does not consider this to be appropriate, or consistent with the
quantitative scope of other exceptions, such as time-shifting and
format-shifting. However, the committee's concerns are allayed by advice from
the Department that the Federal Government may redraft these provisions to
clarify their intended effect. The committee understands that the intended
effect is that only reproductions deemed to be fair dealings will be slightly
restricted and that the scope of the provision allowing any other amounts of
reproduction will not be affected, if they are considered to be fair.
Official copying of library and
archive material
3.134
The committee also notes arguments made by and on behalf of cultural
institutions that the Bill does not make adequate provision for technical
processes related to preservation. In this regard, the committee notes that
best practice standards for preservation, including the UNESCO Guidelines for
the preservation of digital heritage, recommend that 'multiple copies' be
made and stored in different locations.
3.135
The committee is encouraged by advice from the Department that the term
'first copy' in proposed section 110BA will be clarified. The committee
understands that it may be possible for libraries and archives to make
additional copies for the purposes of preservation under the specific exception
in proposed section 200AB (unless determined otherwise by a court). If this is
the case, the Bill should be clarified to put it beyond doubt.
3.136
The committee also expresses the view that the scope of the exception
might be usefully clarified by specifically including such bodies as the ABC,
SBS, the AFC and other similar institutions which hold significant historical
and cultural material.
Educational instruction and caching
3.137
The committee notes concerns raised in relation to proposed sections 28A
and 200AAA. It also applauds the collaborative approach taken by CAG and
Screenrights in relation to a possible solution to address some of the
perceived problems with these sections. The committee acknowledges advice from
the Department that it is considering changes to these provisions.
3.138
The committee also expresses concern at the new requirement under subsection
135ZMB(5) in Schedule 8 that 'insubstantial' copying of works in electronic
works be 'continuous'. The committee suggests that the Federal Government
consider further the possibility of amending this proposed subsection to limit
the potential budgetary impact on educational institutions.
Technological protection measures
3.139
The committee notes the conflicting evidence between some submissions
and witnesses, on the one hand, and the Department, on the other, in relation
to the necessity to link any TPM protected by the Copyright Act to the
prevention of infringement of copyright. The committee accepts the Department's
explanation of the need to ensure compliance with the AUSFTA. However, the
committee notes the apparent divergence between the view expressed by the
Department in the course of the inquiry, and other previous interpretations of
the AUSFTA put forward by the Department and the Federal Government.
3.140
The committee suggests that, at the very least, the language used in the
definition of 'technological protection measure' be harmonised with the
language used in the definition of 'access control technological measure'. That
is, that the phrase 'in connection with the exercise of copyright' in the
definition of 'access control technological measure' be replaced with the more
restrictive phrase, 'prevents, inhibits or restricts the doing of an act
comprised in copyright', which is used in the definition of 'technological
protection measure'. As the language used in the definition of 'technological
protection measure' is presumably compliant with the AUSFTA, the committee
considers that the same language could overcome some of the perceived problems
related to the absence of a direct link to copyright infringement in the Bill.
3.141
The committee also considers that a clear exception for interoperability
should be included in the Bill. In this vein, the committee notes Recommendation
15 of the House of Representatives Legal and Constitutional Affairs Committee
inquiry into TPMs which suggested that there be an exception for interoperability
between computer programs and data. The committee notes that the Federal
Government has accepted this recommendation.[130]
3.142
Further, the committee notes evidence suggesting that there should be a
prohibition on contracting out of TPMs exceptions to protect consumers from
contracting away their rights.[131]
The House of Representatives Legal and Constitutional Affairs Committee inquiry
into TPMs specifically recommended that legislation implementing Article 17.4.7
of the AUSFTA should nullify any agreements purporting to exclude or limit the
application of permitted exceptions under the TPMs liability scheme
(Recommendation 33). The committee understands that the Federal Government has
accepted this recommendation in principle.[132]
The committee also notes that section 47H of the Copyright Act contains a
specific prohibition on contracting out in the context of literary, dramatic,
musical and artistic works; the committee therefore considers that an explicit
prohibition on contracting out in the context of TPMs should be included in the
Bill.
Review of impact of changes
3.143
The committee recognises that the changes proposed by the Bill are
wide-ranging and will have a significant impact on copyright law in Australia.
In light of this, the committee considers that the changes made to the
Copyright Act by the Bill should be reviewed, and publicly reported on, after a
period of two years.
Recommendation 1
3.144
The committee recommends that the Federal Government conduct a public
awareness campaign and develop a 'plain English' consumer guide on the meaning
and effect of the amendments contained in the Bill in order to assist people to
understand their copyright rights and obligations under the Copyright Act
1968.
Recommendation 2
3.145
The committee recommends that the Federal Government re-examine with a
view to amending the strict liability provisions in Schedule 1 of the Bill to
reduce the possible widespread impact of their application on the activities of
ordinary Australians and legitimate businesses.
Recommendation 3
3.146
The committee recommends that, in developing guidelines for management
of the Bill's strict liability offences and infringement notice scheme, consultation
should take place with appropriate bodies representing those to be regulated
under the proposed regime, and relevant user-interest groups.
Recommendation 4
3.147
The committee recommends that proposed subsection 111(1) be re-drafted
to make absolutely clear that individual consumers are not restricted to
watching and listening to broadcast recordings in their own homes.
Recommendation 5
3.148
The committee recommends that Schedule 6 of the Bill be amended with
respect to format-shifting to specifically recognise and render legitimate the
ordinary use by consumers of digital music players (such as iPods and MP3
players), and other similar devices.
Recommendation 6
3.149
The committee recommends that the proposed amendments to the fair dealing
exception for research and study in Schedule 6 of the Bill be clarified to make
clear that only reproductions deemed to be fair dealings will be restricted and
that the scope of the provision allowing any other amounts of reproduction will
not be affected, if they are considered to be fair.
Recommendation 7
3.150
The committee recommends that Schedule 6 of the Bill be clarified to make
it absolutely clear that libraries, archives and cultural institutions are able
to make sufficient copies for the purposes of preservation.
Recommendation 8
3.151
The committee recommends that the scope of the exception for 'key
cultural institutions' in Schedule 6 of the Bill be clarified to specifically
include the ABC, SBS, the Australian Film Commission, universities, research
institutions, and other like institutions which hold significant historical and
cultural material.
Recommendation 9
3.152
The committee recommends that proposed section 28A in Schedule 8 of the
Bill should be amended to clarify that the same range of copyright material currently
covered by section 28 of the Copyright Act is included; that is, that section
28A should apply to communication of a work or subject matter as encompassed in
section 28, and not only to a sound recording or cinematograph film.
Recommendation 10
3.153
The committee recommends that proposed section 200AAA in Schedule 8 of
the Bill be clarified to ensure that caching for efficiency purposes (proxy
caching) does not infringe copyright; and to ensure that there is no doubt that
the reproduction must be removed after the end of the particular educational course
for which it was made.
Recommendation 11
3.154
The committee recommends that the Federal Government consider the
possibility of amending proposed subsection 135ZMB(5) in Schedule 8 of the Bill
so that 'insubstantial' copying of works in electronic works need not be
'continuous'.
Recommendation 12
3.155
The committee recommends that the Federal Government consider
harmonising the language used in the definition of 'technological protection
measure' in Schedule 12 of the Bill with the language used in the definition of
'access control technological measure', by replacing the phrase 'in connection
with the exercise of copyright' in the definition of 'access control
technological measure' with the phrase, 'prevents, inhibits or restricts the
doing of an act comprised in copyright'.
Recommendation 13
3.156
The committee recommends that the specific exception to liability for
TPM circumvention to allow for interoperability in Schedule 12 of the Bill be
amended to ensure it allows interoperability between computer programs and data
to permit interoperable products to be developed.
Recommendation 14
3.157
The committee recommends that Schedule 12 of the Bill be amended to
include a prohibition on any agreements purporting to exclude or limit the
application of permitted exceptions under the TPMs liability scheme.
Recommendation 15
3.158
The committee recommends that the Federal Government undertake a public review
of the impact of the changes made to the Copyright Act 1968 by the Bill,
after a period of two years of operation of the provisions.
Recommendation 16
3.159
Subject to the preceding recommendations, the committee recommends that
the Senate pass the Bill.
Senator Marise Payne
Chair
Navigation: Previous Page | Contents | Next Page