On June 2, 2010 the federal government introduced Bill C-32 which addresses numerous issues that have arisen since the Copyright Act was last substantially revised in 1997, including challenges resulting from rapid advancements in digital and Internet technologies.

The Bill’s introduction follows an extended period of consultation with the public and numerous affected stakeholders in an effort to achieve an acceptable balance between extensions of rights for copyright creators and owners, and those for users. If enacted, Bill C-32 will bring changes to both commercial and non-commercial activities in areas including electronic commerce and Internet access providers and hosting (ISP) services, the use of music and video content, photography, and education and training, to name the most obvious.

Like its predecessors, Bill C-32 has a very large scope and the full potential of its impact on Canadian copyright will take time to determine. Following are some of the most significant changes to copyright law proposed by the Bill:

Anti-Circumvention Provisions

The proposed legislation would prohibit the circumvention of technological protection measures used by rights-holders to secure and control their digital content, the provision of such circumvention services to others, and dealing in technology designed to circumvent protection measures. Apparently, these prohibitions are intended to apply even when a user wishes to "unlock" digital content for an otherwise permitted purpose, such as fair dealing.

Changes to Fair Dealing

Bill C-32 expands the existing categories of fair dealing exceptions to include dealings for the purpose of parody or satire as well as for education purposes.

Changes to Statutory Damages

Non-commercial infringers of copyright would face considerably less exposure to statutory damages if Bill C-32 were to pass. The range of possible statutory damages would be reduced to $100 to $5,000 per infringer and cover all past infringements. The court would also be permitted to consider factors such as hardship of the award to the infringer and whether the infringement impacted the plaintiff.

Limited Liability for ISPs and Search Engines

The government has proposed limiting the liability of ISPs and operators of Internet search engines for the copyright infringements of their subscribers, in that they act as mere conduits on the Internet.

Under the proposed regime, copyright owners would be entitled to send a notice of claimed infringement to an ISP in a prescribed form. The recipient would be obliged to forward it without delay to the alleged infringer identified in the notice and, for a period of six months to one year, retain records that would help determine the identity of the alleged infringer. Only if the plaintiff successfully applies for a court order requiring the ISP to do so, would the identity of the alleged infringer be released.

In the case of a search engine found to have infringed copyright, the only remedy available to the copyright owner would be an injunction prohibiting further use of the copyright material.

Infringement by Providing Services Used to Infringe Over the Internet

Bill C-32 would make it an infringement for anyone to provide a service over the Internet that they know or should know is designed primarily to enable acts of copyright infringement. Determination of infringement will be based on factors including how the service was promoted, the provider's knowledge of past infringements relating to the service, and whether the service would be economically viable without enabling acts of infringement.

New Rights for Performers

The Bill proposes that performers benefit from expanded exclusive rights in their performances when embodied in sound recordings. This expansion would include a broader right of reproduction, making available the right to digital distribution and the right to sell tangible copies of such sound recordings. Further, the Bill would endow performers with moral rights in their performances.

New Rights for Educational Institutions

In addition to the new fair dealing exemption, Bill C-32 provides a number of rights and exemptions relating to education. Exemptions permitting educational institutions to reproduce, display or perform works in the classroom would be rendered more technologically neutral. A number of proposed amendments would also facilitate the use of new digital technologies in the classroom.

Eliminating Distinctions Between Photographs and Other Works

Proposed changes would eliminate the different treatment of photographs under copyright law as compared to other works. Copyright in a photograph would be first owned by the author or the author's employer, as is the case currently for other works.

New Right for User-Generated Content

Bill C-32 would permit individuals to use legitimately acquired works in the creation of user-generated content, but solely for non-commercial purposes. Requirements would include that the source of the original work be identified, and that there be no substantial adverse effect on exploitation of the original works.

Format and Time Shifting, Back Copies

The proposed legislation would permit reproduction of a work for private purposes where the work is a lawful copy—and not merely rented or borrowed—and where the individual making the copy did not circumvent a technological protection measure. A similar right for making back-up copies is also proposed.

Finally, amendments include a time shifting exemption in the case of recordings made for the purpose of viewing or listening at a later time, provided the recording is kept no longer than is reasonably necessary.

Bill C-32 is currently in its First Reading and legislative developments can be expected in the coming months.