Canada has taken new steps to expand the general term of copyright protection to 70 years following the death of the author, from 50. Such change would bring Canada’s protections into alignment with numerous other jurisdictions, including major trading partners such as the United States, European Union (EU), United Kingdom (UK), and Mexico. The change was kickstarted by Canada’s entering into the Canada-United States-Mexico Agreement (CUSMA). This agreement, which entered into force on July 1, 2020, required Canada to extend its general term of copyright protection from 50 years after the end of the year of the author’s death to 70, by the end of 2022. The government began exploring protection term expansion in 2018 during a mandated Parliamentary review of the Copyright Act (the “Act”). Last week, the Industry, Science, and Economic Development Canada department announced the commencement of public consultation on the proposed term extension.

The newly launched “Consultation on how to implement an extended general term of copyright protection in Canada” aims to solicit views from stakeholders and the public on what, if any, additional measures should be taken to address inequities that may arise from the extension of the copyright term by 20 years. It specifically acknowledges concerns surrounding the proposed term extension and proposes 5 options to ameliorate drawbacks that hinge on either remuneration for owners or new exceptions for users.

Background

There is both praise and concern at the prospect of copyright term extension. On the one hand, there are clear benefits to having a longer term of protection — it provides more time to monetize creative works and expose them to new marketplaces for sale. This, in turn, encourages investment in the creation of more Canadian works. However, there are also drawbacks. Many user-oriented groups, including libraries, researchers, educational institutions, and museums, have expressed concern that a longer period of protection means more restrictions on access, as works take longer to fall into the public domain. Of particular concern are the impacts term extension would have on “orphan works” and “out-of-commerce works”. “Orphan works” are published works with no known (or an unlocatable) author. “Out-of-commerce works” are works that were published but are no longer available via normal commercial avenues (for example, out of print books). There are concerns that applying an additional 20 year of protection will result in even more orphaned works or out-of-commerce works, amounting to further restrictions on the dissemination of ideas.

It is currently burdensome to obtain permission to use orphaned and out-of-commerce works in Canada. For orphan works, Section 77 of the Act provides a regime for the publication, reproduction, and performance of published orphaned works via a non-exclusive license for commercial or non-commercial use granted by the Copyright Board of Canada (the “Board”). The regime provides a process for users to apply for and receive a license and pay a tariff to the Board. To obtain the license the hopeful user must show evidence of reasonable (and fruitless) efforts to locate the copyright owner. The owner then has five years from the expiry of the license to collect their royalties. Only published works are eligible for a Section 77 license. Thus, anyone seeking to make unpublished content available digitally cannot avail themselves of this process. This is problematic for libraries, researchers, educational institutions, and museums, who may have come into possession of important unpublished documents for which no owner can be located, and that they wish to include in their published digital collections or otherwise disseminate.

For out-of-commerce works, even more challenges abound—unlike orphan works, there is no statutory regime for compulsory licenses. However, there is some support for the proposition that publication of out-of-commerce works could be excused as a “fair dealing”. Specifically, in CCH Canadian Ltd. v. Law Society of Upper Canada, 2004 SCC 13, in which the Supreme Court set out the current test for assessing for “fair dealing”, Chief Justice McLaughlin suggested that in some circumstances, reproduction of out-of-commerce works with acknowledgement could be a “fair dealing” and thus not infringe copyright if it “could lead to a wider public dissemination of the work — one of the goals of copyright law”. [CCH at para 58]. However, this has never been tested.

Further complicating matters with respect to term extension are the practical considerations of “how to do it” fairly. For nearly 20 years, the Supreme Court of Canada has required copyright be approached in a way that balances owners’ and users’ rights, and emphasized that “the dissemination of works is central to developing a robustly cultured and intellectual public domain” [Society of Composers, Authors and Music Publishers of Canada v. Bell Canada, 2012 SCC 36 at para 10.]

Subsequent to the Parliamentary review of the Act, both the Standing Committee on Industry, Science and Technology (“INDU”) and Standing Committee on Canadian Heritage (the “CHPC Committee”) made recommendations on changes to the Act, including with respect to the term of protection. INDU’s recommendation was to have the current copyright term extend by 20 years to works that are (or become) registered before the end of 50 years from the author’s death. This is controversial, since the Berne Convention—the international agreement that underlies copyright law in almost every country—requires that copyright protection cannot be subject to any “formalities”. This is generally accepted to mean that registration cannot be a condition precedent of protection. However, because the basic term of protection under the Berne Convention is 50 years following the author’s death, perhaps requiring registration for “extra-long” protection could be fine—although this is certainly not the norm internationally. Practically, there are also concerns that requiring registration for an additional 20 years of protection will result in higher administrative costs create a two-tier copyright system—one for sophisticated owners who could bear the costs of registration, and one those less sophisticated owners who may not be aware of the option to extend protection. Moreover, such a two-tier system would cause uncertainty for users/prospective creators as works fall into the public domain at different times, which could disincentivize creation. For a complete summary of both the INDU and the CHPC Committee recommendations, please view our 2019 Copyright Year in Review.

Although not raised in the consultation document, another consideration to the extension of the copyright term is its impact on reversionary rights. Pursuant to Section 14(1) of the Act, where the author assigned their copyright to another person, such assignment terminates and the copyright reverts to the author’s estate 25 years after the author’s death—i.e., halfway through the remaining term of protection. Expanding the term of protection to 70 years without making consequential amendments to section 14(1) will extend the revisionary term to 45 years, leaving more time for the author’s estate to potentially capitalize on the work. This may be an unintended consequence. The Federal government would be well served by considering the impact of the term extension on reversion rights, including whether new exceptions ought to apply or if the underlying policy reasons for this right justify shifting when reversion is triggered so that it is more likely to occur during the author’s life.

The Public Consultation

In its call for public comment, the government of Canada included five non-exhaustive options being considered to mitigate some of the potential implications of term extension. Those options operate on two models: remuneration for owners and exception for users. The focus of the discussion and proposals apply to institutional “public interest” users, specifically by Libraries, Museums, and Archives (LAMs).

The remuneration models proposed (options 1, 2 and 3) specifically concern “works not currently being commercialized”—i.e., orphan and out-of-commerce works. One option would see the current Section 77 regime expand to cover unpublished orphan works and out-of-commerce works. Another would be to develop a tariff-based collective licensing regime based on a similar model in the EU—essentially requiring the payment of Board-approved royalties into an administered fund. A third model would shift the burden to copyright owners to claim equitable remuneration or opt out, and permit use of these types of works by default in certain circumstances.

The proposed exceptions models (options 4 and 5) would permit blanket use in certain circumstances. Under one model, certain public interest uses could be allowed during the final 20 years of protection. This would be similar to an existing exception in the US, which provides libraries and archives with the ability “to reproduce, distribute, display, or perform in facsimile or digital form, copies or sound recordings of published works, or portions thereof, for purposes of preservation, scholarship, or research, during the final 20 years of copyright protection” subject to specific conditions. The last proposed model, touted as the “Made in Canada approach”, would permit certain public interest uses beginning 100 years after creation of the work, regardless of where within the term of protection that anniversary is reached. This would align the exception with the current maximum term of protection for certain types of copyright in Canada—namely performances, sound recordings, non-dramatic films, and anonymous and pseudonymous works.

Of note, the government has acknowledged that the proposed regimes could equally apply to Crown copyright protected works. However, this may be moot if Bill C-209 An Act to amend the Copyright Act (Crown copyright), which would abolish Crown Copyright, is passed and implemented (See our discussion of the bill in our 2020 Copyright Year in Review Article).

All comments are due by March 12, 2021 and should be sent to [email protected].