Phase 2 Revisions to Canadian
Copyright Law

Paper delivered by Dr. S. Timothy Maloney, Director, Music Division, National Library of Canada, at the Congress of the International Association of Music Libraries, Archives and Documentation Centres, San Sebastián, Spain, June 22, 1998.

Background:

Canadian copyright law has existed since 1924. Canada's original Copyright Act was based largely on the British copyright law of 1911 and was not substantially revised for 64 years. An important element of Canadian copyright law is that a work is not required to be registered or deposited at a copyright office in Canada (though there is a voluntary registration system). It is considered automatically copyrighted when created, even if the creator does not signal his copyright by using the international copyright symbol (©). The concept seems so simple that some Canadian authors and composers have difficulty believing that they are actually protected in this manner. In fact, some of them have actually deposited their works in the United States to give themselves added assurance.

In 1988, Phase 1 of a planned multi-phase revision to Canadian copyright law extended copyright protection to computer programs, strengthened the concept of creators' "moral rights," increased penalties for copyright infringement, and permitted copyright collectives to collect royalties on behalf of authors. In the following eight years, other minor changes were implemented as Canada signed a series of international treaties, including the Canada-U.S. Free Trade Agreement in 1989, the North American Free Trade Agreement of 1994, and the World Trade Organization Agreement of 1996 (originally known as GATT, the General Agreement on Tariffs and Trade).

In 1997, Phase 2 of Canadian copyright reform was enacted. It included a number of technical amendments and some substantial changes to the 1924 law. Exemptions were clarified for handicapped people and for non-profit institutions, such as universities, libraries, archives and museums. In addition, there were two key provisions which affect the music industry:
1)  a tariff on blank audio tapes was instituted; and,
2)  for the first time in Canada, "neighbouring rights" on sound recordings were established.
These last two provisions harmonized Canadian copyright law with the "Rome Convention" of 1961. Phase 3 of copyright reform in Canada is promised within the next few years. It will address satellite broadcasting and the Internet, among other issues.

This paper discusses the major provisions of the Phase 2 legislation which affect the music industry and/or libraries and archives.

1) Neighbouring Rights:

Producers of sound recordings and musical artists whose performances are captured on recordings will automatically be entitled to receive royalty payments from those who use sound recordings for public performance or broadcast. This is what is known as a compulsory licence, since producers and performers will not have to be asked for permission to use their recordings in this manner. However, royalties must be paid to them. Under the old Canadian law, only creators received royalties for performances or broadcasts (creators meaning authors, composers and lyricists). This revision of Canadian law will harmonize it with similar laws in the 52 countries which signed the 1961 Convention for the Protection of Performers, Producers of Phonograms, and Broadcasting Organizations, known as the Rome Convention, and with similar provisions in the 1996 WIPO (World Intellectual Property Organization) Treaty on Performances and Phonograms. According to the new provisions of the Canadian law, performers and producers of sound recordings in Canada and in all countries who signed the Rome Convention will be entitled to royalties when their recordings are broadcast or performed publicly in Canada.

The new law also permits the Canadian government to negotiate reciprocal agreements covering neighbouring rights with countries which have not signed the Rome Convention, e.g., the United States (though it is anticipated that the United States will argue forcefully against the concept of neighbouring rights). The provisions in the new law for compulsory licences and reciprocal agreements with other countries are similar to what is already in place for composers and their publishers in the publishing domain in Canada.

In addition to royalty payments for public performance and broadcast of sound recordings, performers, composers and lyricists will now enjoy a "rental right" for sound recordings by which copyright owners may authorize or prohibit any rental of their works. This right was previously given only to creators of computer programs and record producers in Canada. I assume it matches similar provisions in either the Rome Convention or the WIPO Treaty.

2) Private Copying:

Home copying of sound recordings and radio broadcasts onto audio tape will be considered "fair dealing" under Canadian law. "Fair dealing" is not unlike the American concept of "fair use," but not as clearly defined yet. This concept exists in the copyright laws of members of the British Commonwealth, including Great Britain, Australia and New Zealand. Although private copying was technically illegal in Canada until now, this new provision recognizes that there is no practical way to restrict it. While home copying will be permitted in Canada, record producers and the composers, lyricists, and performers whose music and performances are recorded will be remunerated by manufacturers and importers of blank audio tapes in the form of a levy or special tax on all blank audio tapes sold in Canada. Royalties from this levy will be paid only for musical works. The Phase 2 copyright revisions in Canada did not address home copying by computer, i.e., downloading audio or other files to your computer's memory, or the manipulation or re-use of those files. It is expected that computer copying from the Internet will be addressed in Phase 3.

3) Exceptions:

To ensure access to copyrighted works for certain types of users, the 1997 revisions to the Canadian Copyright Act recognize a limited number of exceptions for reasons of public interest. These exceptions permit the use of protected works in certain special cases without authorization or payment, as long as such exceptions do not adversely affect the normal exploitation of the work by the author.

i)  Non-profit educational institutions will be permitted, among other things, to reproduce copyrighted materials for instructional purposes (e.g., on transparencies for overhead projectors or for purposes of testing or examination).

ii)  Non-profit libraries, archives and museums will be permitted to make copies of protected works for purposes of preserving the intellectual content, to maintain or manage their permanent collections, and for the private study or research of their patrons. In addition, these institutions will be granted limited liability regarding the use of self-serve photocopiers by their patrons, though they must display copyright notices and be registered with a copyright collective. This exception diverges dramatically from the practice in the United States, where institutions have been held liable for third-party copying on their premises.

iii)  Multiple copies of protected literary, dramatic, musical and artistic works will be permitted to be made in alternate formats (e.g., braille and "talking books") for persons with learning or perceptual disabilities (e.g., the deaf and blind). This exception is subject to the condition that the work in question is not already commercially available in Canada in the desired alternate format. This exception for persons with disabilities is among the most progressive in the world and contrasts sharply with the situation in Great Britain, for example, which has no copyright exceptions at all for disabled persons.

4) Technical Amendments:

i)  The time limit of copyright protection for unpublished works (such as manuscripts) will change dramatically. Previously, unpublished works were copyrighted forever in Canada. Now, perpetual protection for unpublished works will end, and eventually all unpublished works in Canada will receive the same term of protection as do published works: the life of the creator plus 50 years. During the transition, the period of protection for unpublished works will vary depending on their creators' death dates. This extension of the 50-year limit to unpublished materials aligns Canada with the United States on this particular issue and contrasts with the recently adopted 70-year limit throughout the European Union.

ii)  The term of copyright protection for photographs will be harmonized with the term for unpublished works: the life of the creator plus 50 years. Previously, photographs and negatives were protected for 50 years after the creation of the photo image.

5) Regulatory Environment:

Some of the above-mentioned revisions to Canadian copyright law did not come into effect in 1997, including the provisions for neighbouring rights, the rental right, and the tariff on blank audio tapes.. They will only be put in force when regulations governing their application have been created. Both the regulations and the affected portions of the law will then be enacted together.

Conclusion:

Those are the major elements of the Phase 2 revisions to Canadian copyright law which affect the music, library and archival domains. The Phase 2 revisions were intended to put Canadian law on a more equal footing with copyright laws in many other nations, all of which have had copyright protections and benefits for longer than Canada, and some of which protect the rights of their creators more aggressively than Canada has done until now. However, those revisions, particularly the adoption of neighbouring rights, the establishment of specific exceptions, and the adoption of the 50-year period of protection for unpublished works, seem to place Canadian copyright law somewhere between current European law which, in my estimation, largely favours creators over widespread access; and current American law which, again in my view, favours widespread access over the rights of creators. These changes to the Canadian law reflect an evident attempt to bridge the dichotomy that exists in Canadian society, to find a middle ground between two diverging concepts of law: the anglophone "copyright" (the right to copy) on the one hand, and on the other, the francophone "droit d'auteur," the "right of the author" (presumably not to have his work copied).

As we have seen, Canada finds itself right in the middle between the Europeans and the Americans on some questions, and these will have to be addressed in Phase 3 of Canadian copyright revisions. For example, in Europe, data in a database are given copyright protection; in the U.S. they are not. In Canada, there have been no court rulings on this issue and it is not spelled out yet in our copyright law. The National Library of Canada recently was asked for a licensing fee from the creator of a database which the Library wanted to use on its web site. The Library decided to pay the person in order to use the database now, rather than spending years in court fighting the issue and possibly losing in the end, if the courts were to rule that data should be protected by copyright in Canada.

The concept of "fair dealing" would seem to require further clarification in Canada and may have been left purposely vague in the Phase 2 revisions so that the courts can decide upon its practical application, as they have with "fair use" in the United States. There is still uncertainty in Canada about copyright in electronic publications, though in another development which signalled that the Canadian government is positioning itself to create the right conditions in Canada for increased electronic commerce in the digital age, in December, 1997 the Canadian government signed the 1996 WIPO Treaties on Copyright and on Performance and Phonograms. Further updating of Canadian law will be needed to bring it more into line with the WIPO treaties (e.g., authorship and ownership in audiovisual works, neighbouring rights for performers in audiovisual works, protection of databases and content of Internet-based materials, and the European 70-year term), and these issues will undoubtedly be addressed in the promised Phase 3.

CAML Newsletter/Nouvelles de l'ACBM, Vol. 26, No. 3, December/décembre 1998.