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The Copyright Modernization Act


Table of Contents

General

Consumers

Creators and copyright owners

Education

Innovative Business

Intermediaries

Digital Locks

Piracy

International


General

Why is the Copyright Act being amended? How are the proposed changes good for Canadians?

This update to Canada's Copyright Act is part of the Government's continuing work to modernize Canadian laws for the digital economy. This Bill will help Canadians better address the challenges and opportunities presented by the digital age.

We live in a global, digital environment, yet have copyright laws last updated in the late 1990s, before the "dot-com" era, before social media, and before tablet computers and mobile devices allowed us to access thousands of songs, movies, and applications at the touch of a button or the swipe of a finger.

These changes will enhance the ability of copyright owners to benefit from their work. They also offer Internet service providers (ISPs), educators, students and businesses the tools they need to use new technologies in innovative ways.

Specifically, the Copyright Modernization Act will:

  • implement the rights and protections of the World Intellectual Property Organization (WIPO) Internet treaties;
  • give copyright owners the tools they need to combat piracy;
  • clarify the roles and responsibilities of ISPs and search engines;
  • promote creativity and new methods of teaching in the classroom by providing greatly expanded exceptions for education;
  • encourage innovation in the private sector through exceptions for technical computer processes;
  • provide legal protection for businesses that choose to use technological protection measures or "digital locks" to protect their work as part of their business models; and,
  • give consumers the ability to, among other things, record their favourite TV shows for later viewing, transfer music from a CD to a digital device, and create a mash-up to post via social media.

Will the Government take into consideration the extensive analysis and comments that were provided on this Bill in the last Parliament?

The Government acknowledges the extensive review and input already provided by stakeholders and parliamentarians on the Copyright Modernization Act.

By reintroducing this Bill without changes, the Government is reiterating its support for a balanced approach to copyright reform. We expect that when the Bill is once again referred to a House of Commons committee, the work and testimony from the previous Parliament will be carefully considered and taken into account.

How will this Bill foster creativity and innovation?

For creative industries, this Bill provides a clear, predictable legal framework that allows them to combat online piracy and roll out new online business models.

For high-tech and software companies, this Bill provides the certainty they need to develop new products and services that involve legitimate uses of copyrighted material.

For educators, students and researchers, this Bill opens up greater access to copyright material by recognizing education as a legitimate purpose for fair dealing. New measures will allow more efficient ways to teach, conduct research, and deliver course material and lessons using the latest technologies. It will also allow teachers to distribute publicly available material from the Internet.

For entertainers and commentators, this Bill includes parody and satire as purposes to which fair dealing applies.

For users, the Bill will allow the creation of user-generated content using copyright materials, such as mash-up videos, for posting on a blog or video-sharing site.

Consumers

How does the Bill address consumer needs?

This Bill legitimizes activities that Canadians do every day. For example, it recognizes that Canadians should not be liable for recording TV programs for later viewing, copying music from CDs to MP3 players, or backing up data if they are doing so for their private use and have not broken a digital lock.

This Bill also ensures that digital locks on wireless devices will not prevent Canadians from switching their wireless service providers so long as existing contracts are respected. This will not affect any obligations under an existing contract.

It also provides greater opportunities for people with perceptual disabilities to develop or obtain works in an accessible format.

Will the Bill allow record labels to sue individuals and groups for large amounts, like in the U.S.?

This Bill ensures that Canadians will not face disproportionate penalties for minor infringements of copyright by distinguishing between commercial and non-commercial infringement.

Under current law, for commercial and non-commercial infringements, copyright owners can sue for statutory damages ranging from $500 to $20,000 for each work that is infringed. This Bill will dramatically reduce an individual's potential liability in cases of non-commercial infringement. In such cases, statutory damages will be reduced to a one-time payment of between $100 and $5000 for all infringements that took place prior to the lawsuit.

For commercial infringement, there will be no change from the current law.

Creators and copyright owners

How does this Bill address the concerns of creators?

Creators and copyright owners will have new rights and protections that respond to the realities of the digital environment. For example:

  • Copyright owners will have stronger legal tools to pursue online pirate sites that facilitate copyright infringement.
  • Copyright owners will have new making-available rights to allow them to control how their works are made available online.
  • Copyright owners will also be given distribution rights, which will enable a copyright holder to control the first sale of every copy of their work;
  • Performers will be given moral rights, which will ensure that their performance is not altered in a way that harms the artist's reputation.
  • Photographers will be given the same rights as other creators. They will be the first owner of copyright in their photographs and will receive the same benefits as other creators.
  • If copyright owners decide to use digital locks to better protect their works, they will have the support of the law to do so.
  • Copyright owners will also benefit from legal protection for rights management information, which connects the creator's identity and other key information to the work.

How will the new exceptions affect creators?

The consumer and educational exceptions recognize the everyday uses of common technologies. By allowing these activities in a technologically neutral way, this Bill recognizes that many new technologies have become commonplace the world over and are a regular part of Canadians' lives.

At the same time, copyright owners and creators need to be fairly compensated for their work. The Bill ensures that these activities must only be for non-commercial use. Consumers will not be able to break a digital lock to exercise these exceptions.

Education

How will educational institutions, libraries, archives and museums benefit from this Bill?

This Bill includes a number of measures that will allow educators and students to take advantage of digital technologies.

Most significantly:

  • It expands fair dealing to recognize education in a structured context as a legitimate purpose.
  • It provides for a specific exception permitting educators to use publicly available material from the Internet.
  • Teachers will be able to connect with students in remote communities across the country through technology-enhanced learning. The Bill will allow learning institutions to offer the same opportunities to a student in Nunavut as to one in Edmonton.
  • Libraries will no longer be required to deliver interlibrary loan material in paper form; electronic desktop delivery of materials such as scholarly or scientific journal articles will be permitted.

At the same time, there are safeguards to protect the interests of copyright owners.

What is fair dealing, and why is it being expanded?

Fair dealing is a long-standing feature of Canadian copyright law that permits certain uses of copyright material in ways that do not unduly threaten the interests of copyright owners, but which could have significant social benefits — but only if they are fair.

Fair dealing is not a blank cheque. Currently, fair dealing in Canada is limited to five purposes: research, private study, news reporting, criticism and review. To recognize the important societal benefits of education, parody and satire, the proposed Bill would add these three elements as new purposes to which fair dealing applies.

Innovative Businesses

What is in this Bill for innovative companies?

This Bill gives innovative companies the certainty they need to develop new products and services that involve legitimate uses of copyright material.

For example, with respect to software companies, the Bill explicitly allows activities like encryption research, security testing, compatibility testing and reverse engineering. In addition, the Bill will make it clear that automatic, technical and incidental reproductions are not a violation of copyright. For example, smart phone providers will be assured that certain activities that support the usefulness of their products for consumers are allowed, such as reformatting a webpage so it can be better read on a smart phone.

Similarly, innovative companies such as video game developers will have the legal tools to protect their investments, reinvest in further innovation and create jobs for Canadians.

Intermediaries

How does this Bill affect the status of Internet service providers (ISPs)?

The Bill establishes that ISPs and search engines are exempt from liability when they act strictly as intermediaries in communication, caching and hosting activities.

In Canada, courts have the ability to order the blocking of access to infringing material. Under the new Bill, ISPs will be required to discourage infringing uses of their facilities by participating in a "notice and notice" regime, which will require them to forward any notice they receive from a copyright owner to a subscriber who is alleged to be engaging in infringing activities. Additionally, ISPs will be required to retain a record of this notification, including the identity of the alleged infringer, for use if court proceedings were to follow.

Why has the Government introduced a provision targeting "enablers" of copyright infringement, and how will it affect ISPs and Internet search engines?

The Bill introduces a new civil remedy for copyright owners against those who knowingly enable infringement of copyright. This new remedy supplements existing criminal powers to deal with pirate sites with new stronger tools for copyright owners that make liability for enabling of infringement clear.

Search engines and ISPs will be unaffected by this provision, to the extent that they act as true intermediaries.

Digital Locks

Why does this Bill favour strong protections for digital locks?

Digital locks are an important tool for creators and copyright owners to protect their work. Software producers, video game and movie distributors, for example, continue to use digital locks as part of their business model because they wish to protect the significant investment each makes in developing the products. Canadian jobs depend on their ability to make a return on this investment.

In other markets, however, in light of consumer demands, some businesses have chosen not to use digital locks. Copyright owners may decide whether to use a digital lock, and consumers can then decide whether to buy the product.

The Bill also provides a regulation-making power to allow the circumvention of digital locks in certain cases, for example, where the presence of a digital lock unduly restricts competition in an after-market sector.

Piracy

What does this Bill do to stop Internet piracy?

This Bill contains provisions that will improve the ability of copyright owners to control the uses of their works online.

For example, this Bill contains legal protection for digital locks, and also introduces new provisions to allow copyright owners to pursue those who enable copyright infringement, such as illegal peer-to-peer file sharing sites.

International

How will Canada compare internationally if this legislation is passed?

By implementing the rights and protections of the 1996 World Intellectual Property Organization (WIPO) Internet treaties that establish copyright standards for the age of the Internet, this Bill will bring Canada in line with its G8 partners and most of the major economies of the Organisation for Economic Co-operation and Development.

However, this Bill presents a Canadian approach. For example, the "notice and notice" regime currently used by Canadian ISPs is a uniquely Canadian approach that has been effective at discouraging infringement. Canada is also among the first jurisdictions in the world, if not the very first, to provide in its copyright legislation a new civil liability explicitly targeting those who wilfully and knowingly enable online piracy. Various exceptions in the Bill, such as for the creation of non-commercial user-generated content, and for the use of publicly available Internet material for the purposes of teaching and education, are also innovative approaches to copyright in the digital age.

Overall, the measures in this Bill will help Canadian creators and innovators to compete and contribute to attracting foreign investment to Canada.

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