HERI Committee Meeting

37th PARLIAMENT, 3rd SESSION

Standing Committee on Canadian Heritage

EVIDENCE

CONTENTS

Tuesday, March 30, 2004

¹

1535

The Chair (Ms. Sarmite Bulte (Parkdale—High Park, Lib.))

º

1625

Ms. Susan Peterson (Assistant Deputy Minister, Cultural Affairs, Department of Canadian Heritage)

º

1630

Mr. Clifford Lincoln (Lac-Saint-Louis, Lib.)

Ms. Susan Peterson

The Chair

Ms. Susan Peterson

Mr. Clifford Lincoln

Ms. Susan Peterson

Mr. Clifford Lincoln

Ms. Susan Peterson

º

1635

Hon. Paul Bonwick (Simcoe—Grey, Lib.)

Ms. Susan Peterson

Hon. Paul Bonwick

Ms. Susan Peterson

Ms. Christiane Gagnon (Québec, BQ)

Ms. Susan Peterson

The Chair

º

1640

Hon. Paul Bonwick

Ms. Susan Peterson

The Chair

Mr. Clifford Lincoln

Ms. Susan Peterson

Mr. Clifford Lincoln

Ms. Susan Peterson

The Chair

Ms. Susan Peterson

The Chair

Ms. Susan Peterson

The Chair

Ms. Susan Peterson

º

1645

Mr. Bruce Stockfish (Director General, Copyright Policy, Department of Canadian Heritage)

Ms. Danielle Bouvet (Director, Legislative and International Projects, Copyright Policy Branch, Department of Canadian Heritage)

º

1650

Mr. Albert Cloutier (Senior Project Leader, Intellectual Property Policy, Department of Industry)

The Chair

Ms. Danielle Bouvet

º

1655

Ms. Susan Bincoletto (Director, Intellectual Property Policy, Department of Industry)

»

1700

The Chair

Mr. Gary Schellenberger (Perth—Middlesex, CPC)

The Chair

Mr. Gary Schellenberger

The Chair

Ms. Christiane Gagnon

Ms. Susan Bincoletto

Ms. Christiane Gagnon

Ms. Susan Bincoletto

Ms. Christiane Gagnon

Mr. Albert Cloutier

Ms. Christiane Gagnon

Ms. Danielle Bouvet

»

1705

Ms. Christiane Gagnon

Ms. Danielle Bouvet

The Chair

Ms. Wendy Lill (Dartmouth, NDP)

Mr. Albert Cloutier

Ms. Wendy Lill

Mr. Albert Cloutier

»

1710

Ms. Wendy Lill

Mr. Albert Cloutier

Ms. Susan Bincoletto

The Chair

Hon. Paul Bonwick

Ms. Danielle Bouvet

Hon. Paul Bonwick

Ms. Danielle Bouvet

Hon. Paul Bonwick

Ms. Danielle Bouvet

»

1715

Hon. Paul Bonwick

The Chair

Mr. Bruce Stockfish

The Chair

Hon. Paul Bonwick

The Chair

Mr. Clifford Lincoln

»

1720

Ms. Danielle Bouvet

Mr. Clifford Lincoln

Mr. Bruce Stockfish

Ms. Susan Bincoletto

»

1725

The Chair

Ms. Wendy Lill

Ms. Danielle Bouvet

The Chair

Mr. Albert Cloutier

The Chair

Mr. Albert Cloutier

»

1730

The Chair

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CANADA

Standing Committee on Canadian Heritage

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NUMBER 005

l

3rd SESSION

l

37th PARLIAMENT

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EVIDENCE

Tuesday, March 30, 2004

[Recorded by Electronic Apparatus]

¹  (1535)  

[English]

    The Chair (Ms. Sarmite Bulte (Parkdale—High Park, Lib.)): Good afternoon. Welcome to the Standing Committee on Canadian Heritage and our continuing study of the government status report on copyright reform.

    Welcome back, Ms. Peterson.

    We also have Ms. Bincoletto from Industry Canada, with her group.

    The last time we met, you provided us with a copy of your status report, and you gave us the opportunity to go through it. At that time we asked you if you would have an opportunity perhaps to get together to see where we could go from there.

    We'd be interested to know if we're any further ahead than we were on March 24 and what the next steps are. Then I'd like to open it up to questions by members of the committee, who have now had an opportunity to look at the status report.

    Ms. Peterson, perhaps you could again introduce us to everybody.

º  (1625)  

    Ms. Susan Peterson (Assistant Deputy Minister, Cultural Affairs, Department of Canadian Heritage): Thank you, Madam Chair.

    We can move quickly to the issues. I'd simply like to say I'm glad you've had the chance to review the status report and I hope there is some evidence there of the progress that has been made over the course of the last year. We certainly view this effort, as I said, to be on track now as a means to offer advice to our ministers so they can seek authority to draft a bill later this year.

    A year ago, frankly, we did not even have options, let alone a narrowed set of approaches to a number of the issues. So we have spent the last year defining the problem, analyzing the implications, and delineating the possible options. In this status report, which you've now had a chance to read, we've tried to be as transparent as possible about where we're at. If the committee weren't at this time engaged in this issue, we would go out and consult stakeholders further on the areas where there is more than one approach mentioned and then take the remaining differences to ministers. Our ministers certainly welcome the role, though, that you'll be able to play in helping us get to that place as quickly as possible.

    I hope that after you've heard from us today you will more fully appreciate that the status report does not simply set out contradictory positions and leave it at that. As you asked last time, we would like to indicate today the issues that we believe are more or less ready and the issues that definitely need further attention.

    It certainly wasn't our intention in that rather short document we tabled last time to get into the extensive policy analysis, but we're happy to start engaging you in doing that today and to outline the rationale behind the approaches in that document. We hope then you'll be able to hear from stakeholders on those issues and...a special focus on the ones where there is more than one approach.

    I'd like to tell you where we're at. I will first just list the issues. Basically we do have an agreed approach, although in some cases there are issues about the best means to implement. Just so you know where I'm going, in the end there are four issues that do not fit into that category, and all the rest do.

    The ones that fit into the category, where we basically say we're there, but with a few little things to sort out on the best means to implement, are the making-available right, the very important technological protection measures--

º  (1630)  

    Mr. Clifford Lincoln (Lac-Saint-Louis, Lib.): These are the issues you agree with?

    Ms. Susan Peterson: These are where there's basic agreement, although there's work still to be done on some of them as to the means to implement.

    On page 2, making-available right, we're okay.Technological protection measures and rights management information are on page 3. On page 4, there's distribution right. Then when we come to photographic works, which starts on page 4 of the English, authorship of photographs fits into that category. On page 5, term of protection of photographs fits into that category. Ownership of commissioned photographs on page 5 fits into that category with the proviso that consideration does need to be given to the best way to address privacy and personal use of photographs when they're commissioned for weddings and so on. Moral rights of performers on page 6 fits there.

    The Chair: Just a moment, you're talking too fast.

    Ms. Susan Peterson: Okay, I can slow down.

    Mr. Clifford Lincoln: On ownership, where is it?

    Ms. Susan Peterson: On photographs?

    Mr. Clifford Lincoln: Ownership, yes.

    Ms. Susan Peterson: Authorship of photographs is on page 4, in English. The term of protection of photographs is on page 5.

    Now, on ownership of commissioned photographs, although there is a basic agreement on the approach and on commercial photographs entirely, the one area where we have to give further consideration is with respect to the photographs that are commissioned for personal use, like wedding photographs. That's the only area.

    Consideration does need to be given to the best way to address privacy and personal use of those sorts of photographs. It's a subset of the issue.

    Moral rights of performers fits into that category; so does the next one, which is reproduction rights for performers. In the agreement category, we have to do work on the implications for old performances, as opposed to new performances, but there is basic agreement on the approach.

    Then there is the term of protection for producers and performers. You can skip back to moral rights for audio performers, if you like. The last thing that has to be sorted out there is the implications of the approach for live performances, but that, as I say, is an implementation issue under the moral rights for performers.

    That finishes that category.

    Private copying is in a class by itself because it really is an issue where more work has to be done. That is one where we have to do more work. The other ones are ones where we would really like your help, and our ministers would like your help, in moving forward.

    The issues where there is more than one approach to meeting the objectives are the remainder of the ones in the status report.

    On page 7, on the liability of Internet service providers, the issue there is the extent to which Internet service providers should be held responsible or liable for what they carry.

º  (1635)  

    Hon. Paul Bonwick (Simcoe—Grey, Lib.): On the copyright implications for ratification, could you go over the Internet one more time for me, please. I was taking some notes while you were speaking.

    Ms. Susan Peterson: Sorry, what is your question again?

    Hon. Paul Bonwick: It's on the Internet service provider liability.

    Ms. Susan Peterson: The issue there is the extent to which Internet service providers should be held responsible or liable for what they carry. We do need more airing of that issue.

    Then, on page 9, there are the access issues. Those three issues, likewise, need airing and more work. Under educational access to materials on the Internet, the issue basically put--

[Translation]

    Ms. Christiane Gagnon (Québec, BQ): Would it be possible for you to slow down? We are trying to turn the pages and take a few notes. You know all of this material by heart, but we don't. And we must not forget the interpreters, either.

[English]

    Ms. Susan Peterson: With respect to use of Internet material for educational purposes, the issue there is whether to use fair dealing and a compulsory licence approach on the one hand or a blanket licence approach on the other hand. For technology-enhanced learning, which is the next one--and there's only one more after this--the issue is whether to grant an exception on the one hand or to promote licensing on the other. And finally, for inter-library loans, the issue is the same: whether to grant an exception or to promote licensing.

    I'm wondering if it would be most helpful to you if we zeroed in on the last four issues.

    The Chair: There seems to be consensus around the table.

º  (1640)  

    Hon. Paul Bonwick: Are you starting at Internet service providers liability? We're not getting into any discussion surrounding the private copying?

    Ms. Susan Peterson: The proposal is that we start with the Internet service providers but with the explanation that.... We can come back to you on the issue of private copying, the implications for ratification. We're meeting with CRIA on these issues, and it would be better, frankly, if we came back to you on that one.

    The Chair: Mr. Lincoln.

    Mr. Clifford Lincoln: Could I ask you a question, Ms. Peterson? I just want to make quite sure in my own mind that I've understood.

    We start with Internet service providers, then we have private copying, which is still a question mark--and you explained that--we have the two sub-issues on commissioned photographs where there's a question mark, we have the two issues on the Internet, and then there are educational and technology learning and inter-library loans. In other words, we are at exactly the same point we were at last week.

    Ms. Susan Peterson: Last week, I think, there was the feeling that there was a lot of space between approaches on all the issues. What we wanted to do was to illustrate that on the first grouping of issues there were some issues but that we could get there from here--that's one way of putting it, I suppose--and to therefore put the emphasis on the last four issues. My understanding was that you would like to hear the rationale behind the different approaches that are listed there.

    Mr. Clifford Lincoln: There are six, not four. There are photographs, private copying, Internet service providers, Internet for educational, technology, and inter-library loans, so there are six. I don't know which four of the six you've--

    Ms. Susan Peterson: On the photography one, there's basic agreement on an approach; there's just that one remaining question of the best way to go about accomplishing an end.

    On the last four, there's really much more difference between the approaches, so we would like to explain the rationale for them to you, if that's what you would like.

    I put the private copying in a class by itself, because it's not clear what is needed and what is not needed to ratify the WIPO treaties on that front. We're doing much more work on that, and we're not really in a position at this point to set out what all those issues are. But this report does set out the issues on the other. The private copying issue was not identified early enough as an issue that might have some implications for whether or not the government would be advised to ratify the WIPO treaties, after having made the other changes.

    We would really like to have the other things moved on, so once that issue is resolved at least all the others will be there ready to go, and there won't be any further delay on the other issues in that report.

    The Chair: Perhaps you could quickly go through the rationale for the four you suggested, so we have some time for questions as well. We just have an hour.

    Ms. Susan Peterson: All right. I will turn this over to Mr. Stockfish.

    So the point is, don't get into such detail that there's no time left for questions.

    The Chair: Yes, please.

    Ms. Susan Peterson: Should we do them one by one, then? They're complex enough.

    The Chair: I think we still want to cover them all and then have an opportunity to ask questions.

    Ms. Susan Peterson: Okay.

º  (1645)  

    Mr. Bruce Stockfish (Director General, Copyright Policy, Department of Canadian Heritage): We'll start on the liability of Internet service providers. As you can see, there are two approaches that really reflect different starting points in an effort to clarify the extent of desirable liability on the part of ISPs--whether there should be an exemption with certain additional requirements, or whether there should be an imposition of liability in certain circumstances.

    In either case we're talking about the appropriate level of liability on the part of ISPs for activities on their networks, over their facilities, that would be in the interest of rights holders, but not going so far as to cause problems for ISPs, which offer their networks as intermediaries only. At least that's their argument.

    So there are two approaches. I will ask Danielle Bouvet to address the second approach, and perhaps Susan and Albert can address the first approach.

[Translation]

    Ms. Danielle Bouvet (Director, Legislative and International Projects, Copyright Policy Branch, Department of Canadian Heritage): If I may, I would like to address the committee members in French.

    First, with respect to the litigation, as Mr. Stockfish explained, what must be determined is the extent to which the Internet service providers should be held liable for the transmission and storage of copyright material over their facilities.

    Approach B starts from the premise that the ISPs would be subject to liability for copyright material on their facilities. Why do we favour this approach? Here are the reasons. First, there are currently a large number of cases relating to the liability of Internet service providers winding their way through the courts. SOCAN, in particular, is asking the Supreme Court to find the Internet service providers liable for the public transmission of musical works over their network. That decision by the Supreme Court of Canada is expected within the coming months. We would like to wait until we hear the details of this decision before moving ahead on this issue.

    Some copyright collectives have also submitted two tariff proposals on the reproduction of musical works on the Internet to the Copyright Board. These cases have not yet been heard; in fact, they have been suspended pending the Supreme Court decision.

    Then, there are the 29 CRIA cases. CRIA would like to sue 29 Internet users for copyright infringement of sound recordings. We are awaiting the court's decision on these 29 cases. As with the case before the Supreme Court and the cases pending before the Copyright Board, we believe that all of these actions will help to shed a great deal of light on the responsibility of the Internet service providers and the conditions under which the ISPs may not be held liable for the transmission and storage of copyright material on the Internet.

    There is already an exemption in the Copyright Act for the communication of music on ISP networks. However, as I explained, there are a number of cases before the courts, and for that reason, the assumption in approach B is that Internet service providers, save under certain conditions, would be liable.

    This approach is quite similar to the one that was adopted in the United States and Europe. That is why we are submitting it to the committee for your consideration.

º  (1650)  

[English]

    Mr. Albert Cloutier (Senior Project Leader, Intellectual Property Policy, Department of Industry): Yes, thank you.

    The alternative approach proceeds from a slightly different premise, namely, that it is largely the content provider, that is to say, the website operator, who uploads and really fundamentally exploits the copyright material. Under this approach, ISPs are acknowledged as playing purely an intermediary role; and in some respects in the Copyright Act, notably in relation to the communication right, there is specific acknowledgement that, as common carriers, they should be exempt from copyright liability.

    While it's true that the specific question is before the Supreme Court of Canada at the moment under the tariff 22 decision, that does not settle the issue completely insofar as, for instance, the reproduction right is concerned. Therefore, it may be necessary for us to look at a policy approach that comprehensively deals with ISPs in that way.

    Under this approach, it's acknowledged that ISPs, as intermediaries, carry such a large volume of material that they're not really in a position to monitor everything that flows over their networks. I don't know how many billions of bytes flow every day, but fundamentally, material can flow via e-mail, it can be on websites, and it can be in many other forms. ISPs just don't have the wherewithal to effectively monitor, control, and determine whether the material that may be on websites, or the material that may be flowing through their networks, is infringing or not. They're not in a position to assess the legal relationship that exists between the website operator and the actual rights holder.

    That's not to say that they don't have some role to play in trying to curtail infringing material that may be flowing over their networks. What we would look at is a system whereby, once they have notification that there is some kind of infringing material that may be on the websites they host, or otherwise, they would be obliged to follow a prescribed path. For instance, one of the things they do now is to further the notice on to the subscriber to alert them to the fact that they may be hosting this infringing material. Maybe this could be codified in law to help deal with some of this infringing material. Failing that, they might be subject to some kind of civil sanction, which could also be implemented in the law.

    In fact, as I understand the situation in Europe, the European directive on electronic commerce does exempt them from liability in relation to website hosting and cashing of materials—although it recognizes, again, that maybe they should play a roll in trying to assist in dealing with infringing content through some kind of notice mechanism. It doesn't in any way take away from the ability of rights holders to seek a remedy against the content provider. So I just want to make that clear.

    The Chair: I'm just watching the time. We are going to have to try to be a little more succinct, because there are a lot of questions and we are going to run out of time for questioning.

    So maybe we could quickly highlight the major differences in the last three issues.

[Translation]

    Ms. Danielle Bouvet: All of the access issues can be considered under one heading. The premise for the three B options is always the same. We start from the assumption that the creators have a great deal of difficulty controlling the use of their work on the Internet. You are all aware of the enormous difficulties that they have in exercising their rights and in controlling the Internet use of their work and sound recordings. I am sure that at home, it is easy for you and your children to access information and the work of artists on the Internet. It's incredible.

    The starting point for these three options is always the same. Since it is very difficult for artists to control the use of their work, we are suggesting an approach that would add provisions to the act that would give the artists the tools they need to work together in order to better exercise their rights. Why must they work together? Because we realize that in order to help the schools access these works, it would be preferable to have a blanket licence granted by the creators. It is difficult to grant rights in a piecemeal fashion. This approach would allow the schools to pay for a blanket licence in order to use the works that are required for teaching. The students could use the works that they need without wondering if what they are doing is illegal. This is essentially the approach that is recommended in the three B options.

º  (1655)  

[English]

    Ms. Susan Bincoletto (Director, Intellectual Property Policy, Department of Industry): Merci, Danielle.

    As far as the other options or approaches under the three other headings are concerned, the premise is that even though we do recognize that rights holders should be compensated for material where they want to be compensated, the Internet, as I said already last week, does present some challenges, because there is material flowing where there's not necessarily an expectation of remuneration or compensation, or even of control in the same way as in the analog world, and we want to recognize that we're talking about a different environment.

    In that respect, under the first of the three access issues, which is the access to publicly available material on the Internet, we want to recognize in the act that when there is available information where there's no expectation of remuneration, rules should facilitate that access without necessarily putting it under the umbrella of licensing. Rights holders will still be able to seek compensation when it comes to where they want to exercise their rights, whether it's because they've made it quite clear when they've signalled it through statements or through the use of technological protection measures. What those safeguards would be still remains to be determined, but clearly, I think, from a public policy standpoint, at least from the way the Internet works today, when material is being put on the Internet in order to facilitate dialogue and where there's no expectation, it shouldn't be under a licensed regime.

    The licensed regime seems to be very attractive, but there are still hurdles, because it assumes that everybody will be participating in the licensing regime, and we know, in some cases, rights holders do not want to participate. We know in the music and the movie sectors it is very difficult for them to want to participate in the licensing regime; therefore, it might not facilitate the access for educators to that material.

    On the other two issues, although it's easy to put it under the umbrella of licensing, on the technology enhanced learning, we want to make sure that when technologies are available, they are available in a way that does not either increase the costs to the educators for using it, nor does it impede because of transactional difficulties--because again, it is not easy to clear the rights to all of these.

    Of course, that creates problems to ensure that if a school wants to participate in a distance education program...if it cannot clear the rights to send the content on to a different school, it will not happen. What we want to do is to find rules that will facilitate that, and an exception could be an easy way to facilitate that without taking anything away from the rights holders on the fundamental use of the content, which has a certain value.

    Finally, on inter-library loans, as we explained, currently the act does not allow the electronic delivery of documents. Should we facilitate, again, the use of technology in order to transmit documents and make it more accessible to people?

    There again we believe, provided that safeguards are put in place that will protect the uncontrolled dissemination of the content without the control of the rights owners--if there is such a case, and I think technology has advanced in that respect--that should be facilitated and should also be part of the exemption that libraries currently have.

»  (1700)  

    The Chair: We have half an hour left and six committee members, which leaves each member five minutes to ask questions. I'm going to move to questions now, because I know members definitely have questions. Perhaps what we'll have to do is ask you to come back again to deal with the private copying regime.

    Mr. Schellenberger.

    Mr. Gary Schellenberger (Perth—Middlesex, CPC): Again, I'm going to pass to some of my more experienced colleagues.

    The Chair: All right, I'll take your time.

    Mr. Gary Schellenberger: Okay, you have it.

    The Chair: Madame Gagnon.

[Translation]

    Ms. Christiane Gagnon: I would like to come back to your presentation, Ms. Bincoletto. With respect to the three A options, you seemed to suggest that it would not be possible, as is the case for option B, to have a general licence and it would be difficult to collect the rights for the use of the works, but that there might be a way to go about it. I don't think you were very clear. We must also ensure that the author is compensated for the use of his work. How can we ensure that the authors will be fairly compensated for the use of their work? Also, I don't see how option 3 will allow for any type of compensation.

    Ms. Susan Bincoletto: I'm sorry, to which option were you referring?

    Ms. Christiane Gagnon: The third option, for the use of work on the Internet.

    Ms. Susan Bincoletto: If I understand correctly, you are referring to the three options at the same time?

    Ms. Christiane Gagnon: Yes.

[English]

    Mr. Albert Cloutier: Let's start, first of all, with the material that's taken from the Internet. The option does foresee compensation for the use of those materials both in the case where compensation is expected and in the case where compensation is not expected.

    With respect to the situation where compensation is not expected and people put materials up on the Internet, letting people use it freely, we would still foresee a compulsory licensing scheme where the Copyright Board would establish the appropriate royalty level based on the kinds of uses that are made.

    It is built upon an expansion of fair dealing, but the fair dealing component would deal only with limited uses of the material in ways that are, by definition, not going to prejudicial to the rights owners. So fundamentally, even with respect to material taken from the Internet, it is based on a licensing scheme where rights holders are compensated.

    Does that help to clarify at least for the first part?

[Translation]

    Ms. Christiane Gagnon: That does clarify things for me, because I thought there would be no compensation possible. That is what I thought I had understood.

    Thank you.

    Ms. Danielle Bouvet: Ms. Gagnon, I would like to add that option A is based on the premise that there would be an exemption allowing the schools and students to access copyright material free of charge. What is important to determine, when it comes to this option, is whether or not this approach will prevent the creators from having access to compensation, and more importantly, if the exemption is so broad that it would allow students or teachers to do just about anything. In this case the compulsory licence or the other part of the option would be of little use.

    An exemption is difficult to interpret. According to the Supreme Court of Canada, an exemption, more specifically in the CCH case, has become a right in Canadian law. If we rely on the interpretation given by the court in CCH, then quite a number of things will be covered by the concept of equitable use. The case involved the interpretation of equitable use in the context of existing Canadian law. Proposal A would broaden the exemption so that it might apply in an educational context. The committee must decide whether or not option A would truly allow the artists to be compensated. It must determine whether or not most of their activities would lie solely within this exemption. That is something that I would ask you to think about.

    Coming back to approach B, this one takes into account the fact that on the Internet, there is material for which no payment is expected, but the starting point is that creators will control the use of their work within an educational environment. That is the starting point. This no longer involves an exception, but it gives the artist some control. We must also remember that the Internet contains material for which there is no expectation of payment. There are many examples in the current act. For example, some of these factors have been recognized in giving the Copyright Board of Canada the criteria they need when deciding whether or not to reduce the rates. That's all.

»  (1705)  

    Ms. Christiane Gagnon: Do you happen to know when the Supreme Court will be bringing down its verdict?

    Ms. Danielle Bouvet: I can't tell you, but we are expecting a decision within the next five or six months.

[English]

    The Chair: Again, I'd ask the witnesses to try to make the answers a little shorter, because otherwise we don't have an opportunity to ask the additional questions.

    Madam Lill.

    Ms. Wendy Lill (Dartmouth, NDP): I'm trying to home in on what Madam Gagnon began.

    I think we want to know what is the easiest method here to handle the access issues with the premise in mind that creators are compensated.

    I've heard over the months that the whole idea of a blanket licence is somehow.... I want to know whether you think it's easier or more complicated, because I just heard from you, Mr. Cloutier, that people who do not expect compensation, or who expect compensation, will be compensated. That sounds complicated to me. I don't understand how it is that whether you want to be compensated or not you're going to be, and how does that all work? It sounds complex. The blanket licence sounds so easy. It seems to be easy and it serves the purposes of meeting the needs of the creators, so why wouldn't it be the best model?

    Mr. Albert Cloutier: I'm not sure all people who create material that ultimately winds up protected by copyright see themselves as part of a collective society that might issue blanket licences.

    Ms. Wendy Lill: I appreciate that. That's why I was confused when you said that whether they expect to be compensated or not, they will be. So do you search out people and compensate them whether they want to be or not? Can't they simply say they don't want it?

    Mr. Albert Cloutier: They could, but the door is left open to them, particularly when the uses that may be made of the material are more significant.

    I'll give you an example. It's one thing to browse a work, it may be another thing to download it, it may be something to print it off. But if, in the context of education, material is then subsequently transformed in some way then posted on an Internet site and made available to other students or perhaps more broadly, I'm not sure that even a person who posts with no expectation of compensation would view that activity as being something they've consented to.

    At least under the proposal we have, it leaves open the door that they can seek a compulsory licence if that's what they want. They can go to the board and have the Copyright Board establish an appropriate level of compensation for those more significant activities.

»  (1710)  

    Ms. Wendy Lill: Would you say that this exemption method that you're putting forward is more complex than the blanket licensing in terms of actually implementation, and monitoring, and maintaining?

    Mr. Albert Cloutier: I'm not sure that it would be.

    The flip side is that for materials where there is an expectation of compensation, that would be largely governed by a blanket licensing scheme and the rights holders could issue blanket licences.

    But there would be a procedural aspect where the rights holders would have to seek a tariff by the board. I don't know if that adds to the complexity of the licensing arrangement. But at least what it does do is that the educational institutions will be able to have the use of these materials by paying the appropriate fees in accordance with the tariff by the board as opposed to having to go out and try to seek the consent of each and every individual rights holder who presumably is not terribly interested in compensation in the first place.

    But it leaves the door open to the rights holders to seek the compensation, so I think it's simpler.

    Ms. Susan Bincoletto: If I may add a comment, not all rights holders are organized into collective societies. And that's very important, because if you want easy access, you have to have one price and then you know you can have access to everything. Until that happens, it is difficult in the short term to envisage an easy solution such as a blanket licence.

    The Chair: Mr. Bonwick.

    Hon. Paul Bonwick: Thank you, Madam Chair.

    Through you to the witnesses, the first thing I would say is thank you for expanding on your points, but what we asked for was not what we got, in my opinion. Fortunately the committee decides on its own working schedule and what issues it will or will not address.

    I find it somewhat frustrating that in the last meeting, and I suspect the meeting before that, and if I were to go back over the last year...the committee recognized that these were key points, that there was a philosophical difference or a divide between the two departments on these five or six particular issues.

    Ms. Peterson says, “A year ago...we did not have these options”, let alone the ability to delineate between them. I heard these options a year ago. I just wonder what we did the six years before that.

    At what point in time, when you were talking about the private copying and the implications for ratification, was this identified to you as a possible challenge in the ratification process? Was this something that just came on the horizon nine or ten months ago?

    That's the first question.

    Ms. Danielle Bouvet: Would you mind if I speak in French?

    Hon. Paul Bonwick: No, go ahead, please.

[Translation]

    Ms. Danielle Bouvet: I was the head of Canada's negotiating team for the two WIPO treaties in 1996. Private copying has always been a major issue in negotiating these two treaties.

[English]

    Hon. Paul Bonwick: When was this?

    Ms. Danielle Bouvet: In 1996. When we did the negotiations with respect to these two WIPO treaties, home copying was a very divisive issue among member states.

»  (1715)  

    Hon. Paul Bonwick: That answered my question--I don't mean to cut you off, but we have a very limited amount of time here--but if you check the minutes, that's not the message we just received from Ms. Peterson. We were told that this is something that just came to the surface, yet when I met with groups a year ago they all knew that this issue was clearly one of the potential deal breakers. They knew in 1996. So I'm a little frustrated in that regard.

    Seeing that the officials are asking us for input on those four particular issues, I was looking, as I said clearly in the last one, for you to clarify your position, to define it, and to give us your perceived implications from within the industry--how is it going to affect us. That's what I was looking for, and if we had questions today we could get clarification on that.

    I'm not seeing that on this private copy, and I'm wondering if the committee might instruct the clerk, through the chair, to seek an expert to provide us an opinion on the private copy regime, and that might flow into the work schedule that may be proposed a little later on.

    I've made lots of notes here, but you've not provided a tremendous amount more from last week. So I'm sitting here saying let's just buy into the schedule that will hopefully come forward in the next 10 days or so. I don't know what else to do about it. I'm just frustrated that we're not getting what we're asking for.

    The Chair: Are there comments?

    Mr. Stockfish.

    Mr. Bruce Stockfish: Mr. Bonwick, you keep coming back to the issue of private copying. I assume it's your concern with regard to the implications of the private copy regime on ratification, and we're not denying it's an issue. It's an issue that was addressed in the first group of issues in the section 92 report. But there seems to be an underlying assumption on your part that we are not going to ratify, and that it's because of the private copying regime and this mysterious legal opinion that you referred to.

    I want to make it clear--Minister Scherrer made it clear, Ms. Peterson made it clear, and I'll say it again--that we have never said we're not going to ratify. In fact, it was said that the government's objective remains to ratify or stay on track for ratification. But yes, there are questions with regard to the private copying regime.

    Those questions have been raised; analysis has been done; analysis continues to be done--legal analysis, economic analysis, political analysis. And when that analysis is done, the government will take a decision. We will make recommendations to ministers, to cabinet, as to whether or not to ratify. The question remains open until then.

    In the meantime, what's important for all of us, I would suggest, is to get on with a bill that will implement the obligations in the WIPO treaties and the other issues in the first group of issues. If we don't have a bill, there's no question of ratification. Let's get the bill. Let's get the implementing measures in place that will enable ratification, and we'll continue the analysis that will enable us to make recommendations to cabinet at that time.

    In the meantime, I think focus on ratification takes away from the issues we need to work on. These issues today that we suggested, the four outstanding issues, are the ones we think we need to get us over the hurdle, to get us ready to take final positions before going to cabinet.

    The Chair: A very short reply, Mr. Bonwick. We're going to run out of time.

    Hon. Paul Bonwick: Thank you very much for clarifying your position, Mr. Stockfish. Quite frankly, I come back to the fact that I'm not centred in on copyright, it's quite the opposite. I see the officials centred in on a private copy regime because they keep separating it from the pie and saying that you will, through due diligence, recommend it to the minister.

    I'm saying, as the Prime Minister has said and as the Speech from the Throne said, that the committee is supposed to be actively engaged in this policy--not the ones that you ask us to become engaged in, the ones that we decide we're going to be engaged in. Quite frankly, I will not be taking direction from officials about the four that we will be involved in and the two that we won't be, because we haven't gone far enough on that yet.

    That's my frustration. It's not a preoccupation with private copy. I realize that all five or six of these are very important. What I'm saying is that you are identifying four and saying leave the other two out. I'm saying no.

    The Chair: Mr. Bonwick, we're running out of time.

    Mr. Lincoln.

    Mr. Clifford Lincoln: I'd like to address the four that you suggested and addressed today. I find that I'm further ahead now because at least I know where the support for the various options lies. It's very clear that (b) is backed by Heritage and it pushes a licensing trend, and (a) is backed by Industry and it pushes the exemption trend. It's very clear to me because every (a) is exemption and every (b) is licensing.

    Having said this, I see, for instance, in the first one, Internet service provider liability. There somehow is something that could break the log jam, because the Supreme Court is going to rule. Somehow or another, we'll have to fit with the Supreme Court, whether we like it or not. If the Supreme Court says to go towards one regime, then we're going to go there. If it says no exemptions are okay, then we'll have to follow.

    What happens with the other three, where we talk about the same thing again?

    On the access issues on educational purposes, there's a dichotomy between an exemption through fair dealing and a blanket licence. It's the same for technology and, hence, learning, where you have an exemption for an educational institution; and the other one, licensing of copyrighted material and library loans, etc.

    Is it correct that in the case of the Internet part of it, on ISP liability, that your consensus between the two ministries is to wait for the Supreme Court decision and then move on according to this?

    If this is so, maybe you can answer with yea or nay. What happens to the other three? At what point do you reach some sort of a recommendation among yourselves?

    Obviously, the ministers are going to be looking to you to eventually decide, because otherwise we're going to be in this log jam forever. On exemptions versus licensing, who breaks that log jam? Do you want us to do it?

    That would be easy, but how do we break it? That's my question.

»  (1720)  

[Translation]

    Ms. Danielle Bouvet: If I may answer, I would tell you that experience has shown that when there are consultations relating to certain issues, unique solutions or approaches often result. As evidence, in the case of the issues about which Ms. Peterson said that a unique approach had been suggested by the two departments, I can tell you that, on the whole, these issues have been the subject of extensive discussions over the past years.

    Consultations have begun on the matter of access. With respect to the first issue, the users and creators have been meeting constantly over the past year. But it is the first time that we have put forward concrete options relating to these issues.

    In view of past experiences, I think that the best idea would be to hear what all of the stakeholders have to say about these approaches so that we might determine the impact that each one will have. This could be done through your committee, or through our own consultations as well. I think that this will allow us to find solutions to ensure that the work done on all of these issues will progress at the same pace.

[English]

    Mr. Clifford Lincoln: Very briefly, in terms of the two ministries, do you see a dichotomy there? Creators on one side, distributors and users represented by two different ministries, exemption versus licensing--do you see all this coming together at one point through one process or another?

    Mr. Bruce Stockfish: As Ms. Peterson indicated in her opening remarks, if the committee weren't in play at this stage, we obviously would have had to take it to the next level, which would be consultations with stakeholders, more internal analysis, and taking it up with our respective hierarchies for a decision, with the view to taking it ultimately to cabinet with a recommended option for their decision.

    Yes, it's been difficult, there's no denying that, in terms of crunching these issues, but the point is that the committee is engaged now. And because this is a bill that will ultimately come to you, we want to obviously have instructions to cabinet for drafting purposes that will be receptive to this committee.

    So this committee is engaged, and we welcome you to look at those issues with a view to getting us over the last hurdle so that we can take final positions.

    Ms. Susan Bincoletto: In terms of the ISPs, we did consult. It was part of the four issues we consulted on extensively. So we are taking the ISPs into account.

    As well, the Supreme Court decision is likely to deal with only some of the issues we're looking at, not all of the issues. Therefore, it's not just a question of waiting for it. Of course, it will provide some guidance on how the current act applies, but it won't provide complete guidance.

    Third, I don't think it's a question of rights owners versus users. I think it's a question of all interested parties in copyright having a say in this. This touches everybody. It touches students and it touches educators. It touches everybody.

    So it is a difficult task, I agree, but it's a task that is not as simple as just dichotomizing between users and rights holders.

»  (1725)  

    The Chair: I have just a couple of questions of clarification.

    One of the things that was brought out, perhaps by you, Ms. Bincoletto, was that it's not just about compensation, it's about the creator's right to control and decide when he or she wants to be compensated or not. With your model, where you say people go on the Internet, and perhaps a chat room, and they say they never had any intention, etc., maybe at that point they didn't have any intention, but by opening up and giving it a wide-open exception, aren't you actually taking away future business models? If one day somebody decides to put into a book, or publish, all the chats that were made on a certain day, that's a commercial model. You're taking away that commercial model by opening that exception, and you are taking away that person's right to control it. So I'm wondering if you could address that.

    I want to add to Mr. Lincoln's comment about how on one side you're talking about licensing and on the other side you're talking about exceptions. Mr. Cloutier was very clever, though, in talking about compulsory licensing, which is really an exception in itself, and which you know the creators don't like. There are very limited exceptions to that. I mean, there is a compulsory transmission licence for the cable companies, but we didn't give it to the Internet, so for all intents and purposes it's still an exception.

    I'm going to ask Ms. Lill to ask her question, because we're almost out of time, and Ms. Gagnon has something. I just want to make sure that everybody has a last chance to say something.

    Ms. Lill.

    Ms. Wendy Lill: I'd just like to follow up on your comment, Madam Bouvet, that you want to see what the impact would be on various stakeholders. What are the financial impacts? I keep coming back to that. Let's follow the money on this issue. What are the financial implications of these two models for a school, for Margaret Atwood, or for Lucy Maud or Stuart McLean or some writer who is posting? Can we see the devastating situations that seem to be described from both sides of this? I just think that would be very helpful.

    You must have done some of the math on that.

    Ms. Danielle Bouvet: You asked the same question last week. We took it seriously, and undertook to look at that aspect.

    As I said before, these options are very new, and they have to be looked at from different points of view. On the economic aspect, the cost--who's going to pay, and how much, and who's going to lose, and how much--will be looked at. Hopefully we'll be able to come up with some figures on that front very soon.

    The Chair: Mr. Cloutier.

    Mr. Albert Cloutier: Is there time for me to address your question as well?

    The Chair: Yes, please, and then we'll conclude.

    Mr. Albert Cloutier: I'll take your second point first, on the notion of compulsory licensing versus other forms of licensing where control is retained by the rights holder.

    In terms of the use of Internet-based materials, I think we tried to draw a distinction between situations where there are no expectations of control or compensation versus situations where there are. And where there are, then we tried to say no, it's still up to the rights holder to determine what uses are permissible or not. Now, both licensing schemes do have the underlying premise that there's this fair-dealing exception that would apply in, or extend to, the school environment, but to our mind, the notion of fair dealing very much embraces the idea that it can't be prejudicial. The uses cannot be prejudicial to the rights holders.

    So there is a fair-dealing exception that applies to individuals, but the use they can make of the material is limited. And it's limited precisely for that purpose. It can't be prejudicial to the rights holders. The approach described there would extend it so that, for scholastic purposes, these non-prejudicial uses could be made in the school context, or just clarify that this would be acceptable. But beyond those fair uses, those non-prejudicial uses, there would be some scheme for compensation.

»  (1730)  

    The Chair: I guess I'll just leave with you my concern that the moment you open up an exception, you're taking away potential business models in the future, or future anticipation of compensation, or control, I guess, more than anything else. That's just my concern, and I'll leave that with you.

    Ladies and gentlemen, we've come to the end of our time. Thank you very much for your cooperation in trying to shorten the answers.

    We will put together a work plan and present it on Thursday, after the Auditor General appears.

    Again, thank you very much.

    We're adjourned.