With Bill C-61, the government has finally tackled the protection of technical measures (TMs), i.e. any type of “digital lock” which prevents access to and unauthorized use of copyright protected works, such as films, and sound recordings. These proposed amendments to the Copyright Act, which create sanctions against those who "break" or circumvent TMs, are not without controversy. Do they strike the right balance between the economic concerns of content creators and the legitimate interests of users of these products?

On the international stage, Canada, a signatory to two 1997 Copyright Treaties, has an express obligation to protect TMs in its laws. However, within Canada, there is significant consumer concern that adding a second layer of protection for TMs, over and above, the protection the encrypted works already receive from copyright, will unfairly prevent consumers from accessing and using copies of these works for lawful purposes.

Caught between a rock and a hard place, the government has limited the effect of the sanctions by providing exceptions and limitations to general prohibitions against anyone (a) directly circumventing a TM (b) marketing, or offering services primarily for the purpose of circumventing a TM or (c) manufacturing, importing, selling or marketing technologies, produced primarily for the purposes of circumvention. Copyright holders would have the same remedies (i.e. injunctions, damages, delivery up) for unauthorized tampering with their TMs as for copyright infringement. In addition, with certain exceptions, it would become a criminal offence for a person to knowingly, for commercial purposes, engage in any of the activities described above in (a) to (c), which could result in fines ranging from $25,000 to $1,000,000 and/or prison terms between six months and five years.

The exemptions/limitations are meant to mitigate the effect of these sanctions. First, anyone who breaks a TM to get to the underlying work for his/her own private use will not be subject to statutory damages. In most cases of private use (i.e non-commercial) infringements, actual damages would be minimal so copyright owners often opt for statutory damages, which allow a court to award from $500 to $20,000 per infringement, without proof of damage.

Secondly, the sanctions do not apply to breaking digital locks for the following purposes:

a) investigations of unlawful activities

b) to make a lawfully owned computer program inter-operable with another program

c) encryption device research, provided the owner of that device has been notified of the research

d) to determine whether the product will collect and communicate users’ personal information and to prevent it

e) to assess the vulnerability of a computer, system or network or to correct a security flaw

f) to allow a person with a perceptual disability to make the encrypted work perceptible

g) to allow broadcasters to make an ephemeral (i.e. temporary) copy of an encrypted work for broadcast scheduling purposes

In addition to these, the Bill provides for the adoption of potentially more sweeping exemptions, grounded in traditional copyright principles of fair dealing. The Governor in Council may add exemptions by regulation after considering several factors: (a) whether not allowing the TM to be broken may adversely affect the lawful use a person can make of the underlying work, (b) whether that underlying work is commercially available, (c) whether not being permitted to break the device could adversely affect the traditional "fair" uses one can make of copyrighted materials, (e.g. for criticism, review, news reporting, commentary, teaching, scholarship or research), (d) whether being permitted to break the device could adversely affect the market for or market value of the copyright work, (e) whether the underlying copyright work is commercially available in media and quality appropriate for non-profit archival, preservation or educational uses and (f) any other relevant factor.

It's also important to note that new consumer rights given under Bill C-61 would be affected by the TM protections. For example, Bill C-61 would allow consumers to shift copies of owned sound recordings from one media to another, (e.g. from a CD to an iPod device), for personal use only. However, where that sound recording is protected by a TM, breaking it to “media shift” makes consumers liable under the new TM sections.

If Bill C-61 does become law, it will undoubtedly take time, and litigation before we will know if the balance between protecting both TMs and consumers, through appropriate exemptions, has been properly set