With the report of the Legislative Committee on Bill C-11 (the “Bill”) to the House of Commons on March 15, 2012, it looks like the government’s much-debated Copyright Modernization Act is well on its way to becoming the law of Canada. When it does, it will represent the first substantive reform of the Copyright Act in 15 years. Click here to download Cassels Brock’s annotated version of the Copyright Act as amended by Bill C-11.

The final days of the Committee’s work were devoted to a clause-by-clause review of the Bill, during which Committee members (both government and opposition) were entitled to propose amendments. As expected, the government’s amendments – all of which were adopted – were relatively few. Apart from a last-minute change to tighten up the provision for enforcement of copyright infringement against so-called “online enablers” (more on that below), the government limited its revisions to a handful of minor, highly technical drafting fixes. The opposition’s proposals were somewhat more ambitious: they ranged from language designed to close a possible loophole in the 30-day exception for ephemeral recordings by broadcasters to the introduction of an entirely new right for visual artists to be compensated when their works are resold. However, also as expected, all of the opposition’s proposals (around 30 in total) were defeated.

The government’s stated intention when introducing the Bill was, among other things, to modernize the Copyright Act to bring it in line with advances in technology and international standards, and to establish technologically-neutral rules that are flexible enough to evolve with changing technologies and ensure appropriate protection for both creators and users. Whether the Copyright Act as amended will achieve that goal remains open to question. Among the issues that are certain to attract ongoing debate over the months and years to come are:

  • Do the prohibitions on the circumvention of technological protection measures – so-called “digital locks” – go too far, or not far enough, in protecting the economic and other interests of rightsholders? Do they interfere unfairly with the ability of users to access and use works for legitimate purposes? Are the provisions constitutional, or, as some have argued, do they intrude upon the provincial power to legislate with respect to property and civil rights?
  • Will ISPs and other providers of network services, who will now benefit from a broad new immunity from liability for copyright-infringing activities conducted by others via their facilities, still choose to play any role in helping rightsholders combat copyright infringement and secure compensation for the use of their works?
  • What will be the impact of expanding the fair dealing exception to include education? Will users – or the courts – take seriously the government’s statements that the exception is intended to apply only to education in a “structured context” or will the Supreme Court of Canada’s direction to give fair dealing a “large and liberal interpretation” lead to a different result?
  • Will the new exception for non-commercial user-generated content (UGC) allow services like YouTube, which often profit from the distribution of UGC whose creators had no commercial purpose in mind when posting it, to operate in Canada without compensating rightsholders for the use of their underlying works?
  • Will new hosting services provisions prove sufficient to allow cable companies to provide cloud-based network PVR services without further payment to broadcasters or other rightsholders?
  • Will the prohibition against “online enablers” – those who “provide a service primarily for the purpose of enabling acts of copyright infringement” – prove to be drafted widely enough to capture the activities of peer-to-peer services? Will the prohibition be of any practical use in relation to services located outside Canada?
  • Will the new caps on statutory damages turn out to be reasonable safeguards against excessive penalties for non-commercial infringers, or will they be viewed by those infringers as too low to take seriously?
  • Do any of the host of new exceptions to infringement in the Bill violate Canada’s international copyright obligations, which require exceptions to be limited to “certain special cases” that do not “conflict with a normal exploitation of the work” and do not “unreasonably prejudice the legitimate interests of the author”? If so, how will courts deal with the conflict?

These outstanding questions are sure to lead to a good deal of conflict in the near future, much to the dismay of a wide range of stakeholders – rightsholders and users alike – who have cautioned both the Committee and the government against “legislation by litigation.” Indeed, rather than simplifying the Copyright Act and making it more accessible or easier to understand, the government seems to have complicated it considerably. Especially in light of the five copyright appeals currently under reserve at the Supreme Court of Canada (click here), which will address important issues concerning the scope of the right to communicate works to the public by telecommunication, the interpretation of the fair dealing exception, and the extent of the communication right in sound recordings – it seems clear that the evolution of Canadian copyright law will continue to be a going concern for the foreseeable future.