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Canadian recording industry officially promises not to sue CD copiers

Canadian recording industry officially promises not to sue CD copiers
Canadian recording industry officially promises not to sue CD copiers




-------- Original Message --------
Subject: 	Canadian Recording Industry Pledges No Suits Against CD Buyers
For Personal Copying
Date: 	Mon, 8 Aug 2005 08:16:41 -0400
From: 	Michael Geist  
To: 	declan@well.com 



Declan,

Of possible interest to Politech -- the Canadian Recording Industry
Association yesterday published a public letter pledging not to sue
consumers who make personal copies of their CDs to their iPod or
computer hard drives.  The pledge comes following a Canadian Supreme
Court decision to let stand an earlier case that generated doubt that
the copying was lawful in Canada.  The letter is at
 [Toronto Star] 

I've got some comments on the letter, arguing that it stands to reason
that this principle should similarly apply to those that circumvent a
TPM in order to make such a copies. Comments at
 

The CRIA pledge coincides with my column (posted below) this week on
Canada's private copying system.  I argue that while in theory the
private copying system provides consumers with the right to copy and
artists with appropriate compensation for that copying, it is time to
acknowledge that the system has failed and must be dramatically reformed
or scrapped entirely.

Toronto Star version at
 

Freely available hyperlinked version at
 

MG

*THE FAILURE OF CANADA'S PRIVATE COPYING SYSTEM

*The private copying system, which establishes a levy on recording media
such as blank CDs in return for the right to make personal,
non-commercial copies of music, has long ranked as one of the most
contentious aspects of Canadian copyright law.  Consumers dislike paying
what resembles a tax, retailers complain that it drives business out of
the country, and artists doubt its effectiveness in light of the
inexcusably slow rate of royalty distributions.

While in theory the private copying system provides consumers with the
right to copy and artists with appropriate compensation for that
copying, it is time to acknowledge that the system has failed and must
be dramatically reformed or scrapped entirely.

Private copying was added to the Copyright Act in the late 1990s
following 15 years of lobbying by the Canadian Recording Industry
Association.  CRIA argued that home taping resulted in millions of
dollars in lost revenue each year.  After several policy studies and
task force reports, the levy eventually made its way into Canadian law.

The levy ran into criticism from its inception. The Copyright Board of
Canada was faced with the unenviable task of setting the rate of the
levy.  That process left virtually everyone unhappy.  Some argued that
the levy was too high and thus encouraged consumers to avoid it by
buying blank media outside the country.  Others maintained it was too
low and therefore failed to provide adequate compensation.  Moreover,
consumers and businesses that purchased blank media for purposes other
than copying music plausibly argued that they were effectively
subsidizing those that did copy music.

The beginning of the end may have finally come late last month, when the
Supreme Court of Canada let stand a December 2004 Federal Court of
Appeal decision that affirmed the legality of the levy but rejected an
attempt to apply it to digital audio recorders such as the Apple iPod.
Since the Canadian Copyright Act does not feature an exception to permit
copying personal CDs onto an iPod, many argue that the decision renders
such copying illegal.
Incredibly, the Canadian government plans to further constrict the
rights enjoyed by consumers under the private copying levy.  Bill C-60,
Canada's copyright reform bill, includes a provision that allows the
music industry to prohibit private copying on CDs that contain
anti-copying technologies such as those used on the latest CD from the
popular group Coldplay.  This provision seemingly contradicts CRIA's
pledge in yesterday's Star that it will take no legal action against
consumers who legally acquire music and copy it to their hard drives or
portable devices.

Should this provision become law, Canadians would pay tens of millions
of dollars in levy fees, yet they would be precluded from copying their
CDs onto their iPods or, in the case of "copy-controlled" CDs, making
any private copies at all.

If that were not bad enough, the millions of dollars collected through
the levy does not appear to be making its way to Canadian artists.
Although the levy has generated more than $120 million over the past
five years, Canadian Private Copying Collective (the administrator of
the levy) has only distributed about 25 percent of those funds.

In light of these developments, the Retail Council of Canada, along with
a group of leading retailers, recently notified the Copyright Board of
Canada that they believe that the levy should be drastically reduced to
reflect consumers' increasingly inability to exercise their private
copying rights. Moreover, they note that the music industry should not
collect collecting millions from the levy yet simultaneously argue that
it does not permit private copying on peer-to-peer networks. In fact,
the retailers even urged the Board to replace the CPCC, arguing that has
been "inexcusably dilatory" in distributing proceeds to the intended
recipients.

Industry Minister David Emerson and Canadian Heritage Minister Liza
Frulla have indicated that the government plans later this year to
consult on the future of private copying.  With few remaining supporters
- even one-time private copying champion CRIA welcomed the Supreme Court
decision - change is urgently required.

One approach would be to expand the levy so that it better reflects
current copying practices.  Using the model of several European
countries, the levy would grow in size, but so too would the rights of
consumers to copy both audio and video for personal purposes.  In fact,
such an approach would provide the music industry with multiple revenue
streams since it would collect the levy for peer-to-peer music file
sharing, while also enjoying the benefits of a thriving commercial
download market.

However, given the opposition to the levy system, the better alternative
might be to simply drop it completely.  In its place, Canada could adopt
a "fair use" provision that would allow consumers to copy their own CD
collection onto another device along with the elimination of statutory
damages provisions for such copying cases.  The fair use approach would
match the U.S. model, where the recording industry has acknowledged that
consumers have the right to copy their own CDs without reference to a
private copying levy.

There is no question that the introduction of the private copying system
was intended to provide artists with compensation and consumers with
legal certainty.  It has done neither.  The time has come to replace it
with a fair use system that would be more equitable to all Canadians.


-- 

**********************************************************************
Professor Michael A. Geist
Canada Research Chair in Internet and E-commerce Law
University of Ottawa, Faculty of Law
57 Louis Pasteur St., Ottawa, Ontario, K1N 6N5
Tel: 613-562-5800, x3319     Fax: 613-562-5124
mgeist@pobox.com http://www.michaelgeist.ca 
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