December 2006

OVERVIEW OF AMENDMENTS TO AUSTRALIAN COPYRIGHT LAW

SYNOPSIS

Australian Copyright law is expected to undergo important changes introduced by the Copyright Amendment Bill ("the Bill") which contains a range of major reforms to the Copyright Act 1968 (the "Act").

This article reviews the key changes to the Act introduced by the Bill. The Bill contains over five hundred proposed amendments, many of which are of a minor technical nature. On 1 November 2006 the Bill passed the House of Representatives. Subsequently, on 4 December 2006, the Bill passed the Senate and is currently awaiting Royal Assent. The legislative reform seeks to implement three elements of government policy. Firstly, the policy recognises that copyright industries are important and need to be supported, and therefore legislative reform should not unreasonably harm or discourage the developments of new digital markets by copyright owners. Secondly, copyright laws needs to keep pace with developments in technology. Finally, copyright piracy is becoming easier and the law needs to be constantly updated to tackle copyright infringement. [1]

DETAILED REPORT

PART I - ENFORCEMENT

Film Labelling Practices

Current section 131 of the Act was equivocal about statements of ownership in film labels and applied solely to persons, not corporations.

The Bill inserts new subsections 131(2), (3) and (4) into the Act with the intention to introduce a film specific presumption that more accurately recognises labelling practices used on commercially released films in Australia.

New subsections 131(2) and (3) of the Bill provide that where articles or things embodying a film have been supplied commercially and at that time they bear a label or mark consisting of the copyright symbol (©) accompanied by a specified year and name of a person, then, unless the contrary is established, the presumption is that the film was first made in the year indicated, and the named person indicated was the owner of the copyright in the film when and where the articles or things were labelled or marked.

Computer Program Labelling

The current labelling practices with respect to software are to affix the standard copyright symbol (©) together with the year of publication and name of the copyright owner. There is uncertainty as to whether subsection 132A(2) of the Act, which requires a label or mark stating the year and place of first publication, satisfies the standard copyright notice commonly used by companies.

New subsection 132AAA(3) of the Bill clarifies the presumption relating to statements about ownership of the copyright in computer programs, and is intended to reflect actual labelling practices of software companies. Under new subsections 132AAA(1) and (2) of the Bill, where a copy or part of the computer program has been supplied to the public and at that time bears a label or mark consisting of the copyright symbol (©) accompanied by a specified year and the name of a person, then, unless the contrary is established, the presumption is that the work is original, was first published in the year indicated on the mark, and that the person indicated on the mark was the owner of the copyright when and where the articles or things were labelled or marked.

Internet Infringements

Under section 115 of the Act, a court may grant the owner of a copyright work an injunction, damages, or an account of profits, for a 'proved' infringement of copyright over the internet. In order to deal with cases involving potential commercial scale infringements over the Internet, new subsections 115(5)-(8) of the Bill give a court additional power to have regard to the likelihood of the likely infringements (as well as the proved infringement) in deciding what relief to grant in the action.

New paragraph 115(5)(c) of the Bill is intended to be wide enough to capture commercial-scale Internet infringements that occur through peer-to-peer file sharing or by way of hypertext linking or downloads from remote websites.

PART II - DIGITAL AGENDA REFORMS

Time-Shifting

The advent of technology which allows people to record a radio, television or internet broadcast, for their private and domestic use, to watch or listen at a more convenient time has triggered a new time-shifting exception to copyright infringement.

Current section 111 of the Act permits the 'home taping' of radio or television broadcasts for private and domestic use. The exception was of little practical benefit because of its limited scope to the broadcast only, not to any work, film or sound recording included within the broadcast. The exception did nothing to remedy the situation that notwithstanding most households engage in the practice of taping television programs to watch at a more convenient time, as a matter of law, it was technically an infringement of copyright to make a recording of a substantial part of any work, film or sound recording included within the broadcast.

This section has been repealed and replaced by new section 111 of the Bill, which reflects the intention that copyright law should ensure that appropriate exceptions to copyright infringement are provided to allow common domestic practices that do not unreasonably affect the copyright owner's interests, such as video taping or recording television, radio and internet programs in the home to watch or listen to at a later time.

Format-Shifting

The Bill allows the owner of certain articles embodying copyright material to make a reproduction in different formats. This may be desirable so that the owner can take advantage of contemporaneous technology (dubbing a VHS tape to DVD) or to use the copyright material in a different place (copying music to a portable MP3 player). Currently, the Act permits temporary reproductions of copyright. [2]

The Bill introduces four new sections making it permissible for an owner to copy an original publication without infringing copyright, during following format-shifting events:

• the content of a book, newspaper or periodical publication into another format; [3]

• a photograph from hardcopy into electronic format, or from electronic format into hardcopy form; [4]

• a sound recording from CD, tape, record, or digital genre to any other format; [5] and

• a film from video or DVD to any other format. [6]

A copy becomes an infringing copy if the owner disposes of the original article to another person. [7] This avoids a situation where a person could acquire an article, make free copies of it for ongoing use and dispose of the original article to another person who repeats the process.

Furthermore, a copy becomes an infringing copy if it is sold, let for hire, offered or exposed for sale or distributed for trade or otherwise. [8] This prevents these copyright infringement exceptions being abused by reproductions being sold, let for hire or given away. The exceptions clarify that it is permissible to loan a main copy to a member of the lender's family or household for that person's private and domestic use. [9]

The restriction introduced on making 'serial' copies, will prohibit individuals from copying their collection to more than one format. [10] For example, if an individual makes an MP3 copy to put in their iPod, then they cannot also keep the MP3 copy on their laptop.

Exception for Certain Purposes

The Bill inserts a new section 200AB. The intention is that section 200AB provides a flexible copyright infringement exception to enable copyright material to be used for certain socially useful purposes provided the use does not conflict with a normal exploitation of the work or subject-matter such that the exception deprives copyright holders of significant or tangible commercial gains.

Section 200AB of the Bill introduces three non-commercial specific exceptions to copyright infringement by or on behalf of a body administering:

- a library or archives [11]

- an educational institution. The use must be made for the purpose of giving educational instruction which would include classroom and remote teaching. [12]

- a person with a disability. Where a person is unable to read, view or hear a work or other subject-matter in a particular form due to disability (or a combination of disabilities) the person may make a use of that work - eg to make an accessible version. The use may also be by another person in order to assist the person with disability. This would allow uses to be made for the person with disability by family members, friends or organisations. The use must be made for the purpose of the person obtaining a reproduction or copy of the work or other subject matter in another form, or with a feature, that reduces or overcomes the difficulty in reading, viewing or hearing the work in the original form.

The fourth exception introduced by the Bill covers uses for parody and satire. [13] This use does not have a non-commercial advantage condition in recognition that parody and satire may take place in the commercial media or other commercial setting. The conditions in section 200AB(1) will protect against 'free-riding' for profit or gain which impedes the copyright owner's market.

Communication in the Course of Educational Instruction

Section 28 of the Act provides an exception whereby literary, dramatic and musical works, films and sound recordings may be performed in the classroom without infringing copyright, and therefore no remuneration is payable for the use of the copyright work. The policy underpinning section 28 of the Act is that performances of copyright materials in the classroom, to students in the course of instruction, should not give rise to a right of remuneration for the copyright owner. The Bill inserts new section 28A which is intended to preserve the effect of the policy in section 28 of the Act for new delivery platforms in classrooms. It is intended that new section 28A of the Bill will allow, for example, copyright materials to be communicated from a centrally located source 'player' to remote classrooms without being subject to a requirement to pay remuneration to the copyright owner.

Copying of Communications of Freeâ€'toâ€'Air Broadcasts

Section 135B of the Act deals with copying sound recording of broadcast or a copy of a cinematograph film of the broadcast, yet does not cover online broadcasts. The Bill responds to the increasing trend of broadcasters making the content of their broadcast material available online, either simultaneously or at a later time (eg, through services commonly referred to as webâ€'casting or podcasting).

New section 135C of the Bill extends section 135B of the Act such that freeâ€'toâ€'air broadcast material from online sources made available by broadcasters shall be subject to copyright. This will ensure that copyright owners are appropriately compensated for the use of their broadcast material made available online.

Insubstantial Parts of Works in Electronic Form

Subsection 135ZMB(1) of the Act provides an exception to copyright infringement to allow the making of multiple reproductions or communication of parts of published literary or dramatic works that are in electronic form, if the reproduction or communication is carried out on the premises of an educational institution for the purposes of a course of study provided by it. The Bill repeals subsection 135ZMB(2) of the Act and substitutes new subsections 135ZMB(1A) and 135ZMB(2).

New subsection 135ZMB(1A) of the Bill provides that if the form of the electronic work from which the reproduction or communication is made contains pages whose content is unlikely to change regardless of the system used to view, reproduce or communicate them (that is, it is paginated), then copyright infringement will apply if the number of pages reproduced or communicated exceeds 1% of the number of pages, provided that the work consists of more than 200 pages, and the reproduction or communication is of more than 2 of those pages.

New subsection 135ZMB(2) of the Bill provides that where the circumstance in paragraph (1A)(a) does not exist (that is, the literary or dramatic work in electronic form is not paginated), the relevant test is whether the amount copied or communicated is more than 1% of the number of words in the work.

Electronic Anthologies

Whilst section 135ZMD of the Act applies to multiple reproductions of copies in electronic form, subject to equitable remuneration, it only applies where a work has been separately published and is no longer commercially available.

The Bill introduces new section 135ZMDA, which preserves the technological neutrality of the Act by providing for educational institutions to make reproductions or communications of works in an anthology that has been published in electronic form, subject to the payment of equitable remuneration. The published electronic form of the anthology from which the reproduction or communication is made must contain pages whose content is unlikely to change regardless of the system used to view, reproduce or communicate them (that is, be paginated); and the work copied cannot take more than 15 of those pages. If the total number of pages consists of 15 pages or less, only 1% is permitted to be copied without payment of remuneration.

Active Caching for Educational Purposes

In the Digital Agenda review [14], the issue arose as to how to best provide for proxy or forward caching by educational institutions where selected websites are loaded onto a proxy server where it is possible to store them for hours, days or weeks. It was outlined that this activity was likely to fall outside of the temporary copying provisions in sections 43A and 111A. To achieve a balance between copyright owner and user interests, the Bill amends the Act to allow the active caching of websites by educational institutions under certain conditions.

The Bill inserts new section 200AAA, which provides for caching on a server for educational purposes. The purpose of section 200AAA of the Bill is to allow educational institutions to engage in active caching where cached material is not altered and not retained after the end of the course.

New section 200AAA of the Bill will allow an educational institution to make a work or other subject matter available from a server, where it does so in connection with a course of educational instruction given by the educational institution's staff to students of the institution. Paragraph 200AAA(1)(i) of the Bill requires that the server must be operated by or on behalf of a body administering an educational institution.

PART III - Unauthorised Access to Encoded Broadcasts

On 30 June 2005, the Attorney-General announced that the Government would be introducing amendments to make it a criminal offence to dishonestly access a subscription broadcast without authorisation and payment of the subscription fee. The Government also announced that it should be an offence for pay TV subscribers to distribute a subscription broadcast to others or use it for commercial purposes without the broadcaster's authorisation.

The Bill implements the outcome of the Governments policy review by the form of repealing Part VAA and substituting new Part VAA. The Bill amends the Act with respect to unauthorised access to, and use of, subscription broadcasts by creating an offence for:

- selling, letting, importing, distributing or making an encoder; [15]

- making a decoding device available online; [16]

- causing unauthorised access to the encoded broadcast such that the person does an act causing themselves or any other person to gain access in intelligible form to the broadcast or to the sounds or images from the broadcast; [17]

- unauthorised commercial use of subscription broadcast; [18]

- making an authorized decoder available online to enable it to be used by another to gain unauthorised access to a subscription broadcast; [19]

- gaining unauthorised access to a subscription broadcast. [20] This offence is confined to the person who does the act but this does not involve any commercial element or flow-on effect. It could, for example, cover acts carried out in a private home for no financial gain, but with the intention of avoiding the payment of the relevant subscription fee for the service accessed;

- causing unauthorized access to a decrypted encoded broadcast in different contexts. [21]

PART IV - TECHNOLOGICAL PROTECTION MEASURES ("TPM")

What is a TPM?

TPMs are frequently used for the purpose of preventing copyright material from being copied or accessed. They commonly include password, encryption and DVD region encoding mechanisms. Apart from protecting copyright material, TPMs can also be used for other purposes.

TPMs may be used to restrict competition in markets for non-copyright goods and services, or to prevent the proper use of goods lawfully acquired. For example, region coding measures currently prevent playback of films or electronic games in a geographic location when the film or electronic game is intended to be marketed in a different geographic location. An example of a region coding measure is Regional Playback Control (RPC) which is part of the DVD Content Scrambling System (CSS) used by DVD manufacturers. DVDs are coded for use in one of several regions and DVD players can operate to play only DVDs from a given region.

The Copyright Act currently prohibits, amongst other things, the importation, dealing and manufacturing of TPM circumvention devices (section 116A of the Act, for civil liability and section 132(5A) and (5B) of the Act for criminal liability). However, the Act does not prohibit the actual use of a TPM circumvention device.

Circumventing an Access Control Technological Protection Measure

New subsection 116AN(1) of the Bill provides that an owner or exclusive licensee of copyright in a work or other subject matter that is protected by an access control TPM may bring an action against a person who knowingly, or having reasonable grounds to know, circumvents the access control TPM. By way of comparison, the current TPM regime in section 116A of the Act places no restrictions on circumventing an access control TPM.

Exceptions to Liability

New subsections 116AN(2) - 116AN(9) of the Bill create exceptions to liability for circumventing an access control TPM.

Currently, the Act applies to dealings in devices of circumvention devices, not the act of circumvention. New subsection 116AN(3) of the Bill creates an exception to liability for copyright infringement to creating interoperable computer programs where that information is not readily available from another source at the time of circumvention. For example, it is intended that there would be no protection under the scheme for technology (computer software or hardware) used by a computer printer manufacturer to restrict the use of generic cartridges in its printers. Similarly it is intended that there would be no protection for technology (computer software or hardware) used by a garage door manufacturer to prevent the use of remote control garage door openers made by competitors. It is intended that protection would not be afforded to measures used by the providers of computer systems to restrict services being provided by competing computer system maintenance providers. [22]

New subsection 116AN(4) of the Bill creates an exception to liability to undertaking encryption research. It does not apply to a situation where the copyright owner has refused permission.

New subsection 116AN(5) of the Bill creates an exception to liability for testing, investigating or correcting the security of a computer, computer system or computer network. For example, the exception would allow circumvention of a TPM that protects against removal of a malicious program that affects the security of a computer, computer system, or computer network.

New subsection 116AN(6) of the Bill creates an exception to liability to providing online privacy. The Explanatory Memorandum states that this would permit circumvention in order to identify and disable an undisclosed capability to collect or disseminate personally identifying information about a person's online activities. An example of the effects of the amendments may be seen in the emerging area of Geolocation. Geolocation is a technology in increasingly widespread use which makes it possible to determine the exact location, in the real world, of visitors to particular websites. It usually works by identifying locations based on a computer's IP address (Internet Protocol address), a unique number (similar to a telephone number) used as an identifier when the machine is linked to the Internet. Geopinpoint™ [23] is one example of commercially available geolocation software which translates IP addresses into real geographical locations. Geolocation can be controversial, some regarding it as an invasion of privacy which forces users to disclose their location when they may have good reasons not to. Internet users wanting to avoid geolocation can purchase counteracting software. [24] Under the privacy exception to liability, the Bill allows for the use of devices which disable geolocation software tracking.

New subsection 116AN(8) creates an exception to liability for circumventing an access control TPM for the purpose of acquisition decisions by libraries and other institutions.

New subection116AN(7) of the Bill creates an exception to liability where circumvention relates to anything lawfully done for the purposes of law enforcement, national security, or performing a statutory function, power or duty of Commonwealth, state or territory governments and agencies. Law enforcement is intended to cover any activity for the purposes of enforcing laws, whether the laws are of a criminal or civil nature. For example, activities undertaken by the Australian Taxation Office for the purposes of enforcing tax laws would be covered by this exception. Performing a statutory function or duty includes activities that a statutory body is required to perform as part of its statutory function. Activities undertaken by the Office of Film and Literature Classification in order to perform its statutory duty of classifying copyright material would be covered by this exception.

New subsection 116AN(3) of the Bill introduces an exception to liability where the person has the permission (either express or implied) of the copyright owner or exclusive licensee to circumvent the access control TPM (new subsection 116AN(3)).

Manufacturing a Circumvention Device for a TPM

New section 116AO(1) of the Bill provides that an owner or exclusive licensee of copyright in a work or other subject matter that is protected by a TPM may bring an action against a person who manufactures, imports, distributes or offers to the public or otherwise provides to another person, TPM circumvention devices.

Exceptions to Manufacturing and Dissimilation of a TPM

New subsections 116AO(2) - 116AO(6) of the Bill create TPM manufacturing exceptions to liability, whilst new subsections 116AP(2)-(6) of the Bill create exceptions with respect to providing a circumvention service of a TPM. These exceptions are analogous to the exceptions to liability referred to above, in section 116AN of the Bill.

Remedies

New section 116AQ of the Bill introduces civil remedies where a person circumvents an access control TPM, or manufactures or deals in TPM circumvention devices.

Defences to liability for these criminal actions are set out in new subsections 132APC(2)-132APC(8), 132APD(2)-132APD(7) and 132APE(2)-132APE(7) of the Bill. Exempted from criminal actions are non-profit libraries, archives, educational institutions and public non-commercial broadcasters. There is, however, no equivalent exemption from civil liability for these institutions, apart from the exception that allows libraries, archives and educational institutions to circumvent access control TPMs when making acquisition decisions.

Anti-Competitive Uses of TPMs

The Australian Competition and Consumer Commission, the High Court of Australia and the Federal Parliament have all expressed concern that TPMs could be used for anti-competitive purposes. [25] Arguably, the Bill attempts to deal with this concern by excluding certain devices and technologies, such as regional coding devices from the TPM definitions. However, it could also be argued that the legislation does not adequately answer this problem. For example, a regional coding device, with a dual purpose to inhibit copyright infringement, and segment markets, would be protected as a TPM under the Bill.

It is also of note that the legislation does not prohibit regional coding devices, which have the sole purpose of controlling market segmentation. The legislation merely provides that such devices do not have special protection as TPMs. [26]

Stephens Lawyers & Consultants' Intellectual Property lawyers represent leading companies in both litigious and commercial matters.

For further information contact:

Stephens Lawyers & Consultants

Level 3, 530 Lonsdale Street

Melbourne VIC 3000

Phone: (61 3) 8636 9100

Fax: (61 3) 8636 9199

Email: stephens@stephens.com.au

All correspondence to:

PO Box 13286 Melbourne Law Courts

Melbourne VIC 3000

**Written by Jeremy Williams (edited by Katarina Klaric)

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