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Good afternoon, and thank you very much for the opportunity to address you today on what my industry considers to be the most important bill to go before government.
As mentioned, my name is Stuart Johnston, and I'm the president of the Canadian Independent Music Association. Joining me today is one of my volunteers and board members, Mr. Bob D'Eith. He's the secretary of my board, the chair of my government affairs committee, and in his day job he's the executive director of Music B.C., a provincial music industry association. Bob's also an entertainment lawyer, record label owner, and two-time Juno award nominated recording artist.
You should already have our submission on Bill , which outlines our 12 recommendations for improvements to the bill, so we will try to be brief in our remarks.
By way of background, CIMA represents more than 180 Canadian-owned companies and professionals engaged in the worldwide production and commercialization of Canadian independent music, who in turn represent thousands of Canadian artists and bands. They are exclusively small businesses, which include record producers, record labels, publishers, recording studios, managers, agents, licensors, music video producers and directors, creative content owners, artists, and others professionally involved in the sound recording and music video industries.
To put our industry's size in perspective, the Canadian independent music sector, taken as a block, is one of the largest in terms of sales in this country, second only to Universal Music Canada. According to Nielsen SoundScan sales figures, the independent sector accounts for approximately 24% of all music sales in Canada, which is larger than EMI and Warner Music put together and Sony Music by itself. In short, our members are the owners and operators of small businesses who invest in the creation of intellectual property that spurs economic benefits in terms of jobs, increased GDP, contributions to our nation's trade balance, and are an integral component of Canada's culture as expressed through music.
As Canada's economic sectors continue to evolve, CIMA believes that the creation and protection of intellectual property is one of the few potential growth areas for our economy, particularly through exports. We wish to thank you for this process, and for the responsibilities that you are undertaking to ensure that all views are heard and considered before final approval of the bill is given. We are pleased that we will finally see the bill go before Parliament this spring, because we've waited far too long for a new copyright act.
CIMA members and the broader independent music sector in Canada, as noted, are small businesses struggling to survive in a very challenging market, a difficult environment in which to be creative, innovative, make investments, maintain jobs, and earn a living. Therefore, we believe that the modernization of Canada's copyright regime is crucial not only to our sector but to the broader economy as well.
While we support this bill, Bill has the potential to either be critically important or it could in some ways make an already challenging climate that much more difficult for our independent music sector to survive in, let alone grow and thrive. We shall explain this shortly.
CIMA and its members, while generally supportive of the bill, believe it needs a few amendments, some technical, some more than technical, in order for it to truly reflect the government's stated desire for it to help create jobs, promote innovation, and attract new investment. Most importantly in our view, it must also give creators and copyright owners the tools to protect and be compensated for their work. This last point cannot be understated. If we pull away all of the rhetoric, grandstanding, misinformation, and misunderstanding of what copyright protection really is, it should be self-evident what the real reasons are to have strong legislation in place and how important Bill really is.
The bottom line is that music is commerce. Music is a commodity. It can be characterized as art in its final form. It can be used to define and contribute to our culture, but first and foremost it is a commodity. Governed by the rules of business, it relies on supply chains, domestic and international trade. It can be bought, sold, licensed, for various uses. It is a business that employs many thousands of people, directly and indirectly.
But somewhere along the way, when music was digitized into a series of ones and zeros, it somehow became okay in some circles to steal it, share it, pass it around, all without consideration as to what harm that is doing to the individuals who invested their time, money, and creative energies into that product, not to mention all of those along the supply chain who contributed to that product being brought to market. They are the artists, their labels, their manager, producers, sound engineers, manufacturers, distributors, retailers, and the list goes on. Fair compensation for a product enjoyed by consumers is required to pay all of those good folks in that supply chain. It really is no different from any other service such as professional services, the IT industry, the auto sector, and mining.
We have rules and law in society that tell us that stealing a car, for example, for personal use or resale is wrong. The same people who illegally download and share a track or album would in all likelihood not be the same people who would go into HMV and walk out of the store with a handful of unpaid CDs. It just doesn't happen. Yet in a virtual sense, that is what is happening on a grand scale around the world and in Canada in particular. This theft of music is being facilitated by certain private sector interests like Canada-based isoHunt, the Sweden-based The Pirate Bay, and New Zealand-based Megaupload, thereby depriving my industry the compensation it deserves, while at the same time they are financially benefiting from this illegal practice.
At the beginning of this year, four of the world's top five BitTorrent sites were connected in whole or in part with Canada. isoHunt yesterday filed claims in a Canadian court that their operations are completely legal, claiming Canadian law makes it completely legal. This flies in the face of the intent of . Canada unfortunately is seen as a haven for these types of digital parasites. According to court documents, even the aforementioned Megaupload considered moving its servers to Canada at one time in order to avoid prosecution.
This is not piracy. That's too fanciful a word, and brings a connotation of Hollywood romanticism. What we are talking about is straight out theft. We need tough rules in place to prevent these so-called wealth destroyers from engaging in and enabling theft. We need a new copyright bill.
My colleague Robert D'Eith will continue with the rest of our presentation.
There are a few particular sections. The first is in regard to the non-commercial user, which is the section 22 clause. We understand the government is trying to allow innocent consumers to use the Internet without undue restrictions. This section opens a door that is unprecedented in the world. The non-commercial user language is vague, and could potentially lead to the devaluation of musical copyrights. Notwithstanding the sections that try to balance this, we feel that not having a clear enforcement mechanism that will deal with this will lead to devaluing of copyrights and the abuse of creators' moral rights.
Another very troubling section is the notice and notice provisions in section 41. The independent music sector is built on individual entrepreneurs and small businesses. The section as drafted places an unreasonable burden on the copyright holders to enforce their copyrights. It's impractical to expect copyright owners to go to court every time there is an infringement notice. The copyright infringer will continue to infringe with impunity, knowing there is very little chance that the copyright owner will have the resources to come after such infringement. We strongly urge the government to reconsider this section and create a fair, robust, and equitable provision that provides protection for ISPs while still allowing for notice and takedown of illegally posted intellectual property.
As for statutory damages, capping statutory damages at $5,000 will make damages the cost of doing business on the Internet. Individuals and small-business copyright owners will look at the cost of litigation versus damages and decide that litigation is impractical. Further, even if there is a judgment, it's far too small to have any real impact on infringers. Again, copyright infringers will infringe with impunity. In fact, the provisions of this section will create a vehicle of licensing for infringement.
Another section that is very important to us is ephemeral rights. Revenues in the music industry have steadily declined over the past ten years, leading to a crisis in the business. At a time when the music industry needs support, the bill further erodes revenue in this business. The removal of the requirement to pay a broadcast mechanical licence will lead to a reduction of nearly $21.2 million of revenue.
The royalty exemption presently in section 68 of the Copyright Act creates $1.2 million in exemptions for the first advertising revenues of commercial radio stations to pay neighbouring rights royalties. We feel this provision was put in at a time when there was supposed to be a transition to neighbouring rights. At this point, we feel it should be removed. It would create another $8 million of additional revenue to the music industry.
We would also like to request that the length of copyright in all areas be increased from 50 years to 70 years in order to maintain parity with all other jurisdictions.
I guess I am out of time.
I thank you for this opportunity to speak as a member of the visual arts sector. I'm accompanied by Adrian Göllner, who's the past chair of my organization and a practising visual artist himself. We agree that copyright reform in Canada is long overdue.
I work for a collecting society, Canadian Artists Representation Copyright Collective Incorporated, CARCC, representing about 850 visual artists in matters of copyright. In 2010-11 we distributed over $200,000 in royalties to our affiliates, and we have had years when the total distribution has surpassed $500,000. Our affiliates are grateful recipients of royalty income. CARCC operates on money it earns from licensing.
I believe that as we work to reform our Copyright Act we need to remember our principles. Copyright is very ancient, surely older than the Greek playwright who felt hard done by when his plays were presented without his being paid. That copyright is old simply means that it is integral to creation. Artists must have copyright, and copyright must work for them.
Normand Tamaro, a lawyer, has said that the purpose of copyright laws is to provide a fair and civilized environment for the exploitation of creators' works, and artists must be allowed to negotiate compensation on favourable terms for uses of their works. Copyright laws include moral protections for a creator's reputation. Lately the young artist K'naan, invoked his moral rights when he told the Mitt Romney campaign to stop using his song Wavin' Flag. He did not want to be associated in any way with that campaign and he put a stop to it in a public way. His indignation came from that very old place, his droit d'auteur, his author's right.
CARCC is a member of CISAC, the International Confederation of Societies of Authors and Composers, the multidisciplinary association of copyright collecting societies, and its subgroup, CIAGP, the International Council of Creators of Graphic, Plastic, and Photographic Arts. Both these organizations have expressed dismay by letter to Canadian officials at the threats to artists' incomes posed by Bill C-32, and by extension the identical Bill . They are concerned that Canada will lag further behind in its international obligations to harmonize its laws with those of other countries.
A recent report from CISAC summarized the global revenues for collective licensing--this is worldwide--from 2010 at over 7.5 billion euros. This is a lot. Canadian artists must partake of this vital economy.
Here are our specific concerns with Bill , which I will summarize first in case I run out of time. The first one is that while we are pleased that photographers' rights are improved in Bill C-11, we feel that photographers will continue to be disadvantaged by the exception that allows clients to commission photographs to use for private and non-commercial purposes. The second is we would like to see the exhibition right extended to cover the term of copyright, dropping the June 1988 limitation. Third, we would really like to see an artist's resale right included. I think everybody's very enthused about that. We would support levies on digital hardware to cover private copying, and we do not support fair dealing exceptions for education, satire and parody, or mash-ups. Licensing activity in the education sector should be encouraged.
Here's the reasoning behind our concerns. Photography is a form of visual art, and we are thankful that Bill extends the rights of photographers. However, an exception specifically naming photography, clause 38, has been added, whereby the person who commissions a photograph is allowed to copy for private or non-commercial purposes. The photographer would earn from such copies, and the exception would deprive him or her of income as well as control of the quality of a copied image. We recommend that photographers be treated equally with other visual artists.
Second, Canada's Copyright Act includes an exhibition right that allows artists to require payment for the exhibition of their works if the purpose of the exhibition is not the sale or hire of the works exhibited. The exhibition right was enacted in 1988 and applies to works created after that date of enactment. We would like to see the 1988 date dropped and the exhibition right extended to include all works subject to copyright--that is, life plus 50 years. This would end discrimination against senior artists and the estates of deceased artists, which are often presently excluded. This could easily be put into effect in , and we strongly recommend this action.
Third, Bill C-11 could be vastly improved by the addition of the long overdue artist's resale right, the droit de suite, to the Copyright Act. Resale royalties are percentages of sales of works resold on the secondary market, such as auction sales. They are usually managed collectively. Resale rights benefit artists who have sold their works, often at a low price, only to see them fetch much greater sums later on or in foreign markets. Aboriginal artists and senior artists are the most affected. Some 59 countries around the world have this right included in their legislation. Without the resale right in Canadian legislation, there can be no reciprocity with countries such as France or Britain, and Canadian artists cannot benefit from secondary sales abroad.
The resale right deserves consideration here and now in Bill C-11. Existing collecting societies such as CARCC are ready and willing to take on the administration of the artist's resale right, and there is worldwide evidence that the resale right has little to no effect on art markets.
Fourth, the fair dealing exception for education—as well as all of the exceptions for education, and in particular those pertaining to the Internet—that are detailed in Bill C-11 generally weaken creators' capacity to earn from the reproduction of their works. Creators, including publishers, benefit from the many uses that this enormous sector makes of their works. Creators are the content providers for Canadian culture. Rights holders are paid at the time of publication as well as through collective licensing of reprography, which is used by photocopy.
We believe that collective management has a strong role to play when copies of works are used. Users can use at will as long as they pay for a licence and creators are paid. Reprography must be extended to digital uses and to the Internet. Licensing must be allowed to develop and flourish in this education sector. The education sector should count on paying those who provide its content, as they do those who teach and all the other workers. If they don't, the content will wither and die. Copyright supports culture and national identity.
To add education to fair dealing provisions is to invite litigation and to force creators to defend themselves against claims of fairness on the part of users. Many activities can be called educational. To expect creators and collecting societies to contest every fair dealing claim that comes from a museum or a business, not to mention schools and universities, is to place a very heavy burden upon those who would benefit from copyright. It takes years of unnecessary and expensive litigation to clarify a fair dealing exception, and the judges may well decide that non-payment of rights is indeed unfair to creators. Education really should be removed from fair dealing.
Sixth, the Internet is not the future; it is the present. It's a form of publication that's becoming increasingly important, indeed replacing ways in which copies were made and distributed in the past. It presents huge opportunities. Creators must be allowed to benefit, when their works are used privately, when they're copied from device to device.
A levy on digital hardware similar to that already in place on recordable media would be a fair solution to the problem of payment for private use. The levy is fair payment for something that people actually use—content—without which their shiny devices aren't fun at all.
Besides the economic benefit to creators, there are benefits to users as well. A levy allows people to use with a certain freedom, with no threat to their privacy. It does not replace investigation of the truly criminal activity that is piracy. Law enforcement should take care of that, not the service providers.
Bill C-11 proposes fair dealing exceptions for parody and satire and mash-ups—that is, non-commercial user-generated content. The effect of these exceptions is on the one hand to weaken creators' moral rights, which protect their reputations, and to encourage a culture of entitlement on the other. Canadian satirists have flourished without an exception to copyright. There are still many norms that satirists must respect, even if an exception is instituted.
Visual artists who similarly practice appropriation, a practice often shoehorned into parody and satire, have managed well without an exception. Telling these artists that they are free to appropriate under copyright offers them no protection from other forms of prosecution, such as trademark protections or libel. In other countries, parody and satire exceptions have invited protracted, expensive, and inconclusive litigation. We think they should be dropped from Bill C-11.
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Mr. Chair, committee members, and Madam Clerk, my name is John Lawford, and with me is Janet Lo. We are counsel to the Public Interest Advocacy Centre, one of four major Canadian consumer groups who have banded together under the title of the Canadian Consumer Initiative, CCI. The other members of this coalition are the Consumers Council of Canada, Option consommateurs, and l'Union des consommateurs.
CCI wishes to bring to the committee our view of the consumer interest in copyright legislation. Consumers are one of three major stakeholder groups in this discussion, along with artists and rights holders. However, despite their huge importance, the voices of consumers have not been loud or clear in this debate.
Consumers buy copyrighted content. They enjoy copyrighted content. They directly and indirectly compensate artists and rights holders. They are an essential part of the equation in achieving a copyright law that fairly grows creative content and personal enjoyment of that content. You can't do it without consumers.
This bill makes strides towards recognizing this foundational role of consumers. We like the explicit recognition of consumer rights: of consumers' rights for all copyrighted content, clear backup rights, format-shifting rights, space- and time-shifting rights. We also applaud the efforts to recognize and validate user-generated content that is non-commercial, creative, and widespread among consumers. As written, that provision ensures non-commercial, non-threatening, non-destructive consumer creativity.
However, we have had to curb our enthusiasm for the expression of these consumer rights in the bill because of their potential override by digital locks or technical protection measures. We continue to believe that the power balance between rights holders and consumers has been tipped too far in favour of rights holders under this bill. Every consumer right under this bill can be taken away by a technical protection measure, and that can be done in two ways.
First, the general protection of technical protection measures in proposed section 41 prohibits consumers from backing up or time- or format-shifting content if a digital block is in place. Second, each of the individual consumer rights listed in proposed new sections 29.22 through 29.24 has a subsection that makes that right applicable only if the individual, ”in order to make the reproduction or record the program, did not circumvent...section 41”.
In effect, then, these sections declare that when a technical protection measure is present, none of the format-shifting, time-shifting, or backup rights even exist. This matters, because consumers will therefore never even be able to argue that they are exercising their consumer rights if they circumvent the technical protection measure. If this bill is passed as written, a consumer who breaks a digital lock for non-infringing purposes will be violating the Copyright Act. Although a consumer would not face statutory damages under the act for a circumvention done for private purposes, we are more concerned with the chilling effect of outlawing all tools that permit circumvention of TPMs, even when designed and used only to allow consumers to enjoy their consumer rights.
In short, no business or individual will write or distribute such software for fear of liability, and the vast majority of consumers will not be able to do this themselves. As a result, consumers will have their rights dictated to them by rights holders, who will likely use this power to deny these rights or to demand additional payments for content that can be backed up or time-, space-, or format-shifted.
Consumers will face a myriad of TPM restrictions on devices, media, and delivery mechanisms that are very likely to make some of the content they have bought unplayable and almost certainly will make that content vastly less secure and less usable. The market will not solve this dilemma. The commercial interests of artists and rights holders go the other way.
The Bill committee heard Ms. Milman come and explain that she would like to be paid twice, once when a consumer buys her CD and once when they put it on their iPod. The same committee heard Ms. Parr of the Entertainment Software Association of Canada claim that new business models with TPMs would create more choice for consumers, lower prices, and give more flexibility.
Consumers don't think so. They believe and act as the format-shifting, time- and space-shifting, and backing-up normal people that they are. They feel that they have done the right thing by buying content, paying for it once, and using it normally. They have a right to this expectation. It is for the industry to structure itself to be profitable in this environment and for that industry to fairly compensate artists, not for this Parliament to hand an act to rights holders and artists that protects top-heavy, unfair business models and is contrary to the public interest.
At a minimum, this bill should be amended to recognize these consumer expectations and actual use of copyrighted content in the real world. Therefore, we recommend that the committee consider striking out the language I quoted in each of the proposed new sections 29.22 through 29.24, and those are 29.22(1)(c), 29.23(1)(b), and 29.24(1)(c). These TPM restrictions expressed right in the text of the supposed consumer rights are at the very least redundant, and at the most a contradiction of the consumer rights that are supposedly granted in these sections.
As for the larger technical protection measures in proposed new section 41 and what that means for consumers and other public uses of copyrighted content, CCI understands the Canadian Library Association has written a proposed amendment to the committee of the definition of “circumvent” that will “ensure Canadians' ability to invoke their full rights as information users by allowing them to bypass digital locks for non-infringing purposes”. We support that amendment.
With regard to a positive in the bill, we welcome the amendments to the fair-dealing right, including specific listing of education, parody, and satire. However, again CCI is disappointed that the acknowledgement of rights like this that promote the public interest can be limited by digital locks.
Finally, CCI has a specific amendment to suggest to the committee. I have provided it to the clerk in both languages, and I do hope you have a copy before you.
We were very pleased that the bill creates a category of non-commercial infringement for statutory damages that is limited to $5,000 for all violations. This gives consumers some measure of comfort that they will not face unreasonable and unrealistic demands from copyright-based business models of suing consumers who do not profit from infringement.
However, the proposed new section 38.1 as written in the bill still allows suing consumers as a business model. This section gives rights holders an election to sue for actual damages or statutory damages. Although non-commercial statutory damages are capped at $5,000, the rights holder may threaten very large actual damages in the hope that a consumer faced with a lawsuit settlement letter will pay up. The amount demanded could be far in excess of the $5,000 for non-commercial infringement, even if the likelihood of the rights holder proving actual damages in this amount would be practically zero.
The key phrase is “may elect, at any time before final judgment”. This allows the rights holder or agent to threaten to proceed under actual damages and to send that settlement letter right up until final judgment. This power must be removed from rights holders. It has been abused in the United States under the Digital Millennium Copyright Act.
In Canada, we have several Hurt Locker cases against individual consumers waiting in the bullpen for this act to pass. The solution is to require rights holders to elect at the outset of proceedings under the Copyright Act whether to prove actual damages or rely upon statutory damages when alleging non-commercial infringement.
Our amendment will help to ensure what we believe was the original intent of the bill: to guide rights holders toward the capped statutory damages for most non-commercial consumer infringements.
We thank the committee for its attention, and we're prepared to answer your questions.
Thank you.
:
If everyone can take their seats, please, we'll start momentarily.
Good afternoon, everyone. Thank you for coming to the second part of the fifth meeting of the Legislative Committee on Bill .
We are very short for time for the second part because of votes that will be happening later on tonight. We will be going until 5:30, when we will have bells, and we will be asking for unanimous consent from all parties to carry on for about 15 minutes afterwards.
What we have asked the witnesses and guests to do is to shorten their opening statements to five minutes, which allows us to get through at least the first round of questioning, in which a lot of the information that you want to share comes out.
We also have hard copies of your opening statements, so thank you. I encourage all of the members around the committee table to read those opening statements in full.
We have, from Audio Ciné Films Inc., Jean-François Cormier and Bertrand-Olivier Desmarteau. From Criterion Pictures we have John Fisher and Suzanne Hitchon. From Société des auteurs de radio, télévision et cinéma we have Yves Légaré and Sylvie Lussier.
We will start off the presentations, for five minutes, with Audio Ciné FIlms Inc.
:
Good afternoon, and thank you, Mr. Chair and Bill C-11 committee members, for allowing us to appear today to speak on behalf of our industry regarding what we sincerely hope are unintended consequences of Bill C-11.
My name is Jean-François Cormier, and I am the general manager for Audio Ciné Films, which is based in Montreal. Accompanying me is Monsieur Desmarteau, our communications manager.
Audio Ciné Films is a rights representative and distributor for thousands of films in use in educational institutions across Canada. Our main offices are in Montreal, but we deal with organizations and institutions from every single part of Canada, in both French and English. We are among hundreds of Canadian companies that are involved in the production and distribution of content to the educational sector. We provide content, rights, and services at fair market prices to thousands of schools, colleges, and universities across the country.
A good example of what we do is the movie Monsieur Lazhar, which was Canada's submission for best foreign language film at the Academy Awards last Sunday. Educational organizations can easily present this film, along with thousands of other titles, such as Charlotte's Web and Twelve Angry Men, that are covered with their licence from Audio Ciné Films.
Audio Ciné Films is but one organization in an industry that represents over 500 companies, employs in excess of 8,000 people, and generates approximately $30 million to $50 million in revenues per year.
Specifically speaking for Audio Ciné Films, we typically invest hundreds of thousands of dollars per year to publicize and market the products we represent and maintain a website, which contains information on all the film rights we represent. Our website also allows schools to do film searches based on specific subjects, such as Canadian history, literature, and social issues. It also offers free access to hundreds of film study guides.
As our industry moves toward streaming and digital formats, we foresee having to invest substantial additional resources to keep up with technology and demand from the educational sector. Both ACF and Criterion VEC, who you will also be hearing from today, are privately owned companies and have never received any government assistance or subsidies. We sell our products and services at competitive market rates.
Our market is one of the rare sectors in the film industry that operates without the support of public funds. Yet it remains highly vulnerable to the changes proposed in Bill . Although we certainly understand and support the need for updated copyright regulations, several new clauses in Bill C-11 will have what we believe are unintended consequences that will cause serious financial damage to our business and our industry as a whole.
In particular, a proposed change to section 29.5 of the Copyright Act, on performances, eliminates the requirement for educational institutions to obtain and pay for licences currently needed for the presentation of cinematographic works in an educational context. It further places a new reverse onus and monitoring responsibility on our industry for violations, reduces or eliminates previous penalties, and eliminates requirements for record-keeping.
We have submitted our proposed amendment in our brief. We believe it can easily be added to section 29.5 of the Copyright Act.
Our industry as a whole almost entirely depends on the educational sector for its livelihood. The production, rights representation, and distribution of cinematographic works to schools, colleges, and universities, and the licensing revenue this generates, are critical to our industry. Without some minor technical modifications, Bill will lead to the overall loss of jobs and investments, and it will lead to a decline of content available to Canadian schools as financial incentives are removed.
We are appealing to committee members today to recognize the harm that will be caused to our industry and the jobs that will be lost if the proposed amendments to section 29.5 are passed as written.
Small businesses such as ours are at the core of Canadian economic success. Nothing demonstrates this better than our industry, which is made up of mostly small unsubsidized privately owned companies, staffed by hard-working and innovative people.
Thank you.
:
Good afternoon. Thank you, Mr. Chair and committee members, for allowing us to appear today and to speak to you on behalf of both our company and our industry.
My name is Suzanne Hitchon, and I'm here with John Fisher. Together we are representing Criterion Pictures, a division of Visual Education Centre, one of the largest distributors of audiovisual materials in Canada. Our company focuses on the distribution of curriculum-based materials for in-classroom educational purposes. We have been in business since the 1960s.
Our industry provides a vast array of audiovisual content that covers all grade levels and all subject matters in both of Canada's official languages. We are here today on behalf of an entire industry that may very well cease to exist should pass into law.
We operate independently of government subsidies, and our industry as a whole employs more than 8,000 Canadians.
For more than 50 years, our industry has been providing a highly valued service at fair market prices to educational institutions, while at the same time contributing $30 million to $50 million in annual revenue to the Canadian economy. Like many private industries and small businesses in Canada, we have certainly faced our fair share of challenges. We've had to adapt to change and take financial risks, adjusting to new technologies and budgetary constraints while at the same time meeting the needs of our customers as they have demanded increased services at lower prices. This is the reality of the private sector.
In recent years our company alone has invested millions of dollars of our own money to build a K-to-12 digital delivery platform comprising more than 25,000 audiovisual curriculum-based programs to meet the needs of our customers. Through all this change, we have survived and grown without government support or financial assistance. However, since the inception of this industry sector, nothing has posed a greater threat to its continued existence, to our very livelihood and our lifelong investment, than the passing of this new legislation in its current form. Should Bill C-11 pass in its current state, it will have catastrophic consequences for both our business and that of our industry.
As currently written, Bill C-11 will eliminate requirements for educational institutions to pay for copies of materials they currently license from us, representing a direct loss of millions of dollars in revenue and effectively putting us out of business. The current legislation places a new reverse onus on our industry to monitor more than 15,000 schools throughout Canada for violations—an impossible task. Additionally, it subsequently reduces penalties for damages and eliminates all requirements for record-keeping.
These new conditions in Bill C-11 will lead to an overall loss of jobs and investment and a decline of Canadian content, as most financial incentives for private investment are now removed. As a result, students and teachers will become more dependent on U.S.-produced cinemagraphic works, as Canadian product will be difficult to find.
The government will ultimately need to fill the gap by providing more taxpayer funding to organizations such as the National Film Board of Canada and/or the CBC, if it feels Canadian programs have any value.
The passing of Bill C-11 in its current form is of benefit to neither the non-theatrical industry like us nor the Canadian educational community. There is no winner. Educators are not asking to be exempt from the current copyright provisions, but that is what this bill prescribes. This was clearly outlined during the testimony of the Council of Ministers of Education during the previous committee hearings, when the chair of the CMEC, the Minister of Education for Nova Scotia, stated and I quote:
We are not asking for anything for free. The education system, the sector, pays for licences and copyright, and will continue to do so. What we are asking for with these amendments is to have things clarified.
Ms. Rosalind Penfound, deputy minister of the CMEC, testified:
Our assessment is that each year across Canada there's likely more than a billion dollars spent by the education sector to pay creators for their books, movies, art, etc....
We would not anticipate that this bill would in any way reduce the amount of money the education sector would be putting into these efforts.
Finally, this is from Ms. Cynthia Andrew, from yesterday's testimony, from the Canadian School Boards Association:
...it has been suggested that the education community does not want to pay for education materials, and this is incorrect. Education institutions currently pay for content and for copying of these materials....
CSBA is not suggesting, nor have we ever proposed, that school boards should not pay for intellectual property.
That's the end of the quote.
:
Good afternoon and thank you, Mr. Chair and committee members.
The Société des auteurs de radio, télévision et cinéma is a craft union representing nearly 1,400 authors working in the audiovisual sector.
I'd like to start by making it clear that we are not in favour of the adoption of the bill in its current form. Even though the bill contains a few interesting elements, we believe that the measures intended to strengthen copyright are much less numerous than those limiting or restricting it.
Every update to the Copyright Act brings with it a whole new set of exceptions, which have an impact on creators' incomes, cause problems when interpreting the act and can lead to more litigation in the dealings between copyright owners and users. Bill unfortunately follows in that vein.
At the present time, the private copying regime applies only to sound recordings. With the introduction of digital formats that make it easier to access and copy contents, we think it would be beneficial for the private copying regime to be extended to books, films, etc. in order to protect the economic value of all types of works. However, over the long term, Bill will put an end to the private copying regime since compensation will be limited to blank audio media…
So I was saying that Bill , over the long term, will put an end to the private copying regime since compensation will be limited to blank audio media rather than extended to other media and devices now in common use. By also creating new exceptions, such as those allowing reproduction for private purposes, the government has put up a roadblock to any subsequent extension of the private copying regime to the audiovisual field and other sectors.
Making copies for private purposes is a widespread practice that cannot realistically be eliminated or criminalized. The private copying regime essentially makes the practice legal by compensating authors. At a time when content is circulating more than ever on a variety of platforms, the extension of the private copying regime would in fact be a potential solution to the problem of controlling the use of works.
The bill permits the use of legitimately acquired material in user generated content … created for non-commercial purposes. However, this applies only to creations that do not affect the market for the original material, such as creating home videos or mash-ups of video clips. The justifications given for this exception are that more and more, Canadians are using content in ways that contribute to the cultural fabric of our society and it is important for Canadians to be able to fully participate in the digital economy.
It's hard to fully participate in the digital economy if commercial purposes are to be avoided. There is no doubt that certain uses are fairly harmless but the application of this exception could be much broader and difficult to interpret. Using one work to create another also means that the author's moral rights in the integrity of the author's work are ignored. On what basis can the government allow the author's creative output to be appropriated by others? This new exception opens the door to a variety of uses that will be impossible to control.
We have nothing against parody and satire. Our authors are actually the creators of some of it. But as much as we defend their right to produce that type of content, we also refuse to allow works to be appropriated solely to profit from their success and fame.
Many authors have produced parody and satire without being sued. Why does the government find it useful to make this change by including parody and satire in fair dealing? Is there not a risk of unnecessarily extending the scope of that exception, opening the door to a more lax interpretation, and fostering new court cases?
In general, the exceptions are supposedly motivated by a desire for balance between copyright owners and users. The exceptions in Bill cover the audiovisual sector, but go beyond that to encompass other sectors. Nowhere is it demonstrated that free access to content helps achieve greater balance between the two sides.
And yet, in recent years, thanks to digitization, it is becoming easier and easier to access and copy works but more complicated to provide compensation. The imbalance indeed exists but it is clearly tipped in favour of users over copyright owners.
The current act contains all the parameters needed to ensure a balance between copyright owners and users. For example, copyright licensing agencies help make content easier to access while the Copyright Board can intervene to set pricing if the parties involved are not able to reach a negotiated agreement.
Before adding new copyright exceptions, the government could also have considered that copyright is recognized in the Universal Declaration of Human Rights and that international treaties such as the Berne Convention specify that exceptions should, as a rule, be special cases which do not conflict with a normal exploitation of the work and do not unreasonably prejudice the legitimate interests of the right holder.