We're going to get started. Thank you, everybody, for being here. Again, our apologies, but that's the way the House works. Votes take precedence over anything else, especially when they're confidence votes.
Welcome to meeting 134 as we continue our five-year statutory review of copyright.
We have with us today from the Canadian Anti-Counterfeiting Network, Lorne Lipkus, chair; from the Consumer Technology Association, Michael Petricone, senior vice-president, government affairs; from Creative Commons Canada, Kelsey Merkley, representative; and from OpenMedia, Laura Tribe, executive director and Marie Aspiazu, digital rights specialist.
Normally opening statements are seven minutes. You can have up to seven minutes, but the more time we have to ask questions, the better.
We'll begin with Mr. Lipkus.
Thank you for the opportunity to speak with you here today.
The Canadian Anti-Counterfeiting Network is made up of intellectual property owners, service providers, certification bodies, legal firms, industry associations and others dedicated to help prevent counterfeiting fraud and copyright piracy in Canada.
Almost every one of the members of CACN have their own day jobs. My own background is as a partner in a law firm, based in Toronto, covering intellectual property brand protection issues for over 80 brands across Canada. I've been doing so since 1985, and I've lived through the changes in trademark and copyright law during that time. Most recently, I have been intricately involved in the border enforcement request for assistance program in Canada.
I spend my days—and as my wife is fond of saying, many other times as well—trying to protect brand owners from the proliferation of illegal, dangerous, counterfeit, as well as pirated products that find their way into Canada and online.
While we can all agree that there's no single solution to address copyright infringement or the sale of counterfeit product, I hope we can also agree that it is in all of our best interests to provide rights holders with the tools that have been proven to be the most effective at reducing copyright infringement around the world, in order to address infringement in Canada.
Unfortunately, Canada has rarely been a leader around the world in these areas. Fortunately, we can now look to and learn from the experience of others in these areas.
I want to make it clear that I'm here to comment and speak about the products, sites and services that contain and sell intellectual properties, copyrights and trademarks. Any and every legitimate, authorized, authentic product, either is or can be counterfeited or pirated, and a look at what we've seen in Canada proves the point.
You've heard from several knowledgeable people during these hearings about the harm to our creative industries through illegally making available music and motion pictures.
The CACN supports the position taken by Bell, Rogers, the Canadian Media Producers Association, the Motion Picture Association - Canada and others on the need to allow rights holders to obtain injunctions, including site blocking and de-indexing orders, and against intermediaries whose services are used to infringe copyright.
However, the focus of CACN and my purpose here today is on what can be done to protect against products, physical goods, merchandise, items that everyday Canadians are making, importing, exporting, buying online, buying on Canadian streets, or buying from stores. These products bear copyright protected works. They also sometimes bear registered Canadian trademarks. Sometimes they contain both copyrights and trademarks.
I have seen counterfeit products, sites and services that make available to Canadians medications, food, contact lenses, electrical products, including extension cords and circuit breakers, some of which have been found in Canadian hospitals, automotive parts, batteries, smart phone chargers and chords, cellular devices, shampoos, makeup, tools, fertilizer, furniture, luxury goods and apparel. You name it; if it's being made, it's being counterfeited or copied.
At CACN, we therefore support needed amendments to the Copyright Act. I've mentioned the injunctive relief and the safe harbour provisions, but the third thing that we've been asking for is a simplified procedure to deal with the products that I've just mentioned.
We would like the introduction of a simplified procedure, under section 44, which relates to CBSA's request for assistance program, so that it is clear that border officers are authorized and mandated to not only detain these products coming into Canada but to seize them. Right now, they detain them. We're asking that they be allowed to seize them, as is the case around the world, and destroy them, without the need for a judicial proceeding which is the hallmark of the existing program.
Our organization also hopes that one day Canada will have a meaningful intellectual property rights coordination centre that can intake information obtained by law enforcement, by customs and related agencies, as well as members of the public and intellectual property rights holders under one roof to deal with the proper utilization of resources dedicated to dealing with this ever-increasing problem in Canada.
Thank you for your kind attention.
On behalf of the Consumer Technology Association, I am pleased to participate in the committee's review of Canada's Copyright Act. I am also honoured to appear before you because as a child I lived in Oakville, Ontario, and I have many happy memories of growing up in your wonderful country.
CTA represents 321 billion Canadian and U.S. consumer technology industries, comprising more than 2,200 Canadian and U.S. companies, of which 80% are small businesses and start-ups. CTA also owns and produces CES, the international trade show for consumer technology.
In our written brief, CTA urged that this review's outcome should be one that makes Canadian and international works, services and technologies more accessible in Canada and abroad. We expressed concern over proposals to move in the opposite direction by imposing new constraints on technologies, devices and local and international service providers. These innovations have helped Canadians to lead the world economy. This review should enhance rather than limit Canada's contribution. Therefore, we have made the following recommendations:
One, maintain and enhance limitations on exceptions such as the doctrines of fair dealing and fair use. Two, avoid unique impositions on online service providers, or OSPs, that would hobble Canada's contribution to international discourse and result in a loss of service in Canada. Three, reject attempts to oversee the design of technology and devices or define classes of technology or devices to be subjected to some sort of levy.
Finally, with respect to copyright terms, we have argued against the extension of copyright terms, believing the focus should be on creating new works and directions. We see the USMCA's contrary results as unfortunate and hope the effect can be mitigated in your law through exceptions, limitations and more discretion with respect to fair dealing.
In terms of fair use, having accepted the U.S. provisions on copyright term and the U.S. policy on circumvention of technical measures, Canada should also balance these with appropriate limitations and exceptions of the sort that mitigate their impact on U.S. law. Canada took constructive steps in 2012 to recognize best practices and fair dealing. These practices promote research, study and criticism, and they recognize the value of satire, parody and user-generated content. While a full fair use regime would perhaps better serve the present dynamic environment, perhaps Canada's fair dealing regime could be made more flexible and more adaptable.
The strict application of a code-based regime such as fair dealing cannot account for new technologies and new uses. One step harmonious with U.S. law would be to add the words "such as", which appear in the U.S. code, section 107. This would allow Canada's courts to keep up with the reasonable and customary practices of businesses and users.
The fair use doctrine, developed by courts as an iteration of the U.S. First Amendment principles, has continued to adapt even after being codified. Its application by the Supreme Court in the 1984 Sony Betamax case opened the door to personal communications, commerce and the Internet. In our industry, we refer to this as the Magna Carta of the consumer technology industry. Fair use has also been the basis of informal codes and best practices, which I know exist in Canada as well in many areas.
Internationally, the ability to quote and criticize has been important for democracy and innovation. CTA believes the U.S., Canada and Europe should encourage these values both at home and abroad.
In terms of technical measures, Canada did follow the U.S. lead in making circumvention of technical measures illegal, but in this area as well has not provided corresponding limitations and exceptions. As the U.S. Register of Copyrights ruled last week in its DMCA section 1201 recommendations, lawful user exceptions are particularly necessary in the diagnosis, maintenance and repair of modern cars, farm equipment and other devices, because embedded software has replaced analog circuitry in mechanical parts. Under the new regulations, U.S. farmers will no longer have to worry about the legality of getting expert assistance to repair a tractor or harvester during a short northern growing season.
After exhaustive study and commentary from CTA and others, the registers found such exceptions can and should be implemented without putting creative expression at risk. This is a step forward that Canada should also consider. Even though fair use is not seen by U.S. courts as a defence to DMCA 1201, it is the metric used by the Register of Copyrights in evaluating exception petitions. Limitations based on such considerations would serve Canada well.
An issue on which Canada and the USMCA now lead together in a positive direction is the recognition of safe harbours for online service providers hosting user-generated content. As we noted in our brief, studies have shown that the impairment of safe harbour protections would have the greatest impact on small and local OSP entrants that don't have the resources to do mass filtering. We recognize, however, that no regime is perfect. In our brief, we urge the consideration of measures to address spamming activities under Canada's notice and notice regime. As in the case of technical measures, both the constraints and necessary relief from them are now moving targets that are best aimed in tandem.
In terms of site blocking, this is a measure long opposed by CTA, which has been raised again by participants in your review. When drafted in the U.S. as part of the proposed SOPA/PIPA legislation six years ago, such proposals collapsed under expert scrutiny and public outrage. In the Canadian context, such measures would have the additional drawback of depriving entrepreneurs and users of access to sites available in other portions of North America and beyond.
CTA also opposes recent proposals for new levies and design constraints on products and services. Such measures become distortive of technologies and markets, and eventually are made irrelevant by technology change except for lingering lawsuits. In our experience, device levies do not satisfy rights holders' needs to respond to technical change, and, again, quickly become outmoded.
In terms of copyright term extension, CTA views the public domain as a valuable resource for cultural creativity and for future innovation. We see Canada's agreement in the USMCA to add 20 years to terms to match the situation in the United States as unfortunate, but we would hope that in your review, through the measures we have suggested, you can mitigate the consequences of contracting the public domain. It has been suggested in the U.S. that some formality should apply in the last 20 years of protection to avoid orphan work problems, and Canada may also consider such a solution.
In conclusion, the pace of innovation is often faster than anybody's ability to legislate responsibly. Even the pace of a five-year review cannot anticipate or keep up with the changes that have replaced mechanical devices with digital ones, and then replaced many of those devices with online services. CTA recommends that this committee put a premium on creativity and innovation and be skeptical of impositions on digital services, digital devices and online services.
On behalf of CTA, I thank you for this opportunity to participate.
Hello. Thank you for inviting me here today.
I'd like to begin by acknowledging that the land on which we gather is the traditional unceded territory of the Algonquin nation.
My name is Kelsey Merkley. I'm here as a public citizen and a representative of Creative Commons Canada. We are part of a global non-profit organization established in 2001, with 26 country chapters worldwide, each working with artists, librarians, scientists, filmmakers and photographers. We create, maintain and promote the Creative Commons licence suite of globally recognized copyright licences that are free to use. They allow for creators to choose how their works are reused under simple standard terms.
Globally, the CC licences have been applied to over 1.4 billion works around the world. What's powerful to me about those 1.4 billion works is that individuals made an active decision to share 1.4 billion times. If you have used one of Wikipedia's 40 million articles, downloaded a photo from Flickr or watched videos on YouTube, you have come in contact with one of our licences in a commercial or non-commercial context.
Examples of our licences in the world include Lumen Learning, which permits commercial use under an open licence at over 280 institutions in the U.S. This year alone, they've had over four million visits per month to their open education content website. In multiple instances, Lumen has demonstrated that their supported OER, open educational resources, offering eliminates the performance gap between low socio-economic students and higher socio-economic students.
Here in Canada, the globally recognized leader in open textbooks, BCcampus, has saved economically stressed students in British Columbia over $9 million in textbook costs through Canadian-created open licence textbooks.
Canadian science fiction and young adult author Cory Doctorow chooses to license many of his works under a CC non-commercial licence that grants access to everyone as long as they don't sell his creativity. Researchers at MaRS in the Structural Genomics Consortium, Aled Edwards and Rachel Harding, have used the most open licence, CC By Attribution, to accelerate the pace of scientific discovery by opening up their lab notes to other researchers around the world without restriction.
The New York Public Library, the Met, the Rijksmuseum and, most recently, Europeana, all share works under a Creative Commons licence to allow for their collections to travel globally.
We advocate and offer advice to governments and institutions that want to use open licences to help their citizens access content. We've offered advice to the European Space Agency, the U.S. Department of State, the U.S. Department of Education and the European Commission. All of them have used CC licences in their publicly funded works to benefit the public. Here in Canada, Quebec was the first government worldwide to adopt the CC 4.0 licence to all open data released by the province.
I'm grateful to the committee for the opportunity to offer a few thoughts and suggestions as you continue your review for potential changes to the Copyright Act.
First, the public domain is harmed by copyright term extension. Fundamentally, we believe that all creativity builds upon the past and that promoting and protecting a robust public domain are central to our mission. Why? Because works in the public domain may be used by anyone without restriction. Works in the public domain become the raw material for creativity and innovation. The committee should not reopen the terms discussed under the Copyright Act. If the term is to be extended 20 years, significant consideration should be given to other permitted uses and clearer fair dealing to mitigate its impact on education, creativity and innovation.
Second, permit creators to reclaim their rights. We endorse Bryan Adams' recommendation to this committee for Canadian creators to reclaim their rights from 25 years after death to 25 years after assignment.
Third, protect fair dealing, especially for education. Fair dealing for education is crucial to ensuring that copyright fulfills its ultimate purpose of promoting essential aspects of the public interest.
Fourth, the right to read should be the right to mine. Considering the massive potential for novel research discoveries, advancements in AI, machine learning and Canadian innovation, the Copyright Act should clarify that the right to read is the right to mine. It should ensure that all of these non-expressive/non-consumptive uses, like text and data mining, are included under the fair dealing framework or broadly supported under other legal measures.
Fifth, improve open access to government-funded education, research and data. The sharing of works under Creative Commons licences is a legitimate exercise of copyright and should be the norm for all publicly funded resources such as research, education materials, government-collected data and cultural works.
Canada should reform Crown copyright regime, because all Canadians should have the right to access and reuse, without restriction, work produced by their government. Canada should place these materials directly into the public domain at the time of publishing.
I hope your questions will allow me the opportunity to speak more to the public value and scientific opportunity of open access publishing.
Gratitude is at the centre of the work we do, so I'll end here with thanks to you for extending the invitation to hear from me today.
Good afternoon and thank you for having us.
I would also like to begin by acknowledging that we are on the traditional territory of the Algonquin people
My name is Laura Tribe. I am the executive director of OpenMedia. We are a community-based organization of more than 500,000 supporters working to keep the Internet open, affordable and surveillance-free. I am joined today by my colleague Marie Aspiazu.
Let me be clear in stating that Canada has a strong and balanced copyright system. But the recent NAFTA renegotiations have struck a significant blow to this balance and to Canada's position as a leader on copyright. We hope that through this review process we can amend the Copyright Act to improve access to content and restore balance to this system.
By allowing an international trade agreement to set a significant portion of Canada's copyright agenda, the government not only accepted troubling amendments, including extending copyright terms by 20 years, but actively undermined this ongoing consultation.
Over the past year, a number of extremely problematic levies, or taxes, have been put forward as a means to help compensate Canadian creators. We simply cannot afford the following proposals that would increase the costs of digital connectivity:
First is an iPod tax. This recycled idea would tax all smart phone devices sold in Canada to compensate for alleged music copying. This idea ignores the decrease in private music copying with the rise of subscription-based services, and the fact that people use smart phones for a wide variety of reasons far beyond music consumption—let alone illegal music consumption.
Next is the Netflix tax. This proposal would reverse the CRTC's digital media exemption order and see over-the-top, or OTT, providers required to comply with the same Canadian content regulations as broadcasters. This fundamentally misunderstands the nature of the Internet and would actually target all OTT services of all sizes, not just Netflix.
Then there's the Internet tax, a requirement for Internet service providers to pay into CanCon funding as Canadian broadcasters do. Unfortunately, we know these prices will be passed on to customers. Canadians already pay some of the highest Internet prices in the world for subpar service. This idea has been rejected by nearly 40,000 Internet users in OpenMedia's community.
Now there's a copyright tax. Recently, we heard a proposal for all Internet use over 15 gigabytes per month, per household to be taxed. This is based on the misguided claim that any Internet usage over 15 gigabytes must be due to streaming content, and that streaming content, even if users pay for it legally, means users should pay more to compensate creators.
Creators should be adequately compensated, but these are not the solutions to make this happen.
As OpenMedia community member Bill put it, “I'm a small business owner and use a lot of bandwidth for online meetings and other related activities. An internet tax would kill my business, putting six people out of work.”
We cannot afford to further increase our digital divide and the price of the Internet in Canada. A fast, affordable Internet connection is essential.
Separately, let's talk about sales tax. Charging federal sales tax to online content providers is often conflated with the above proposals, but is critically distinct. Should the federal government choose to apply HST to international online services, those taxes should rightly be charged and remitted to the government, then allocated into the general budget as the government sees fit, including as funding for arts, culture and creators.
Bell Canada's FairPlay website blocking proposal is one of the most dangerous suggestions we've heard yet. This would inevitably censor legitimate content and speech online and violate net neutrality protections, all without court oversight. It would set a dangerous precedent for other censorship proposals in the future.
Experts have pointed out the expensive and problematic technical aspects of implementing these censorship interventions. Additionally, nearly 100,000 OpenMedia supporters spoke out against Bell Canada's FairPlay website blocking proposal when it was tabled both during NAFTA and before the CRTC.
These are the words of our community member Ryan:
Arbitrarily allowing website blocking and website takedowns will result in a severe reduction of civil rights and political freedoms, as companies and organizations can decide to remove websites that they don't like, regardless if any terms were violated....We have a strong legal system, where the accused is deemed innocent until proven guilty. Let the courts handle the matters, since they are subject to public scrutiny and inquiry by law.
Additional dangerous proposals making their way to Canada in light of the EU's proposed copyright directive are the link tax and mandatory content filtering algorithms. The link tax would copyright the snippets of text that usually accompany links, often used as previews to help Internet users find content online. Requiring aggregators to pay for content just to be able to promote it actually harms content creators by reducing the discoverability of their content, but it also entrenches the largest content aggregators, such as Facebook and Google, by making the cost for new entrants even higher. This proposal has already been implemented and proven a failure in both Germany and Spain.
Content filtering requirements would turn online platforms into the copyright police. Forcing online platforms to implement mechanisms to identify and block materials believed to infringe copyright before being posted, similar to YouTube's multi-million dollar content ID system, won't come cheap. As we know, it will still result in false positives and inevitably result in the takedown of legitimate content.
We have outlined a number of concerning proposals on the table, but we believe some simple amendments can be made to the system to help restore balance. At the very least, the government should maintain the current fair dealing list, including education, parody and satire. Additionally, explicitly adding transformative use would be greatly beneficial. Ideally, Canada will adopt broader fair use provisions, similar to those in the U.S. We also urge the government to eliminate Crown copyright.
As OpenMedia has previously stated, Canada's notice and notice system is a fair regime for addressing alleged copyright infringements. However, the government should provide content guidelines for notices that prevent threats or demands for settlements.
OpenMedia has been advocating on copyright issues over the past six years. Our community's lengthy efforts include five years of campaigning against the secretive trans-Pacific partnership and its dangerous IP chapter; “Our Digital Future: A Crowdsourced Agenda for Free Expression”, a positive vision for sharing and creativity online, sourced from over 40,000 people; over 50,000 people urging Canada's to stand up for citizens' digital rights in NAFTA; and over 2,500 submissions to this committee's consultation via OpenMedia's online tool at letstalkcopyright.ca.
Before coming here today, we asked our community what we should say to you. We hope their voices are well represented.
In conclusion, we ask the committee to address the needs of the people these rules affect the most: everyday people who depend on a balanced copyright regime for their daily activities.
Thank you. We look forward to your questions.
Nobody has the number. Anybody who gives a number is guessing. We do know that worldwide some recent studies—one was done by the OECD, which I'm sure has been shown to you. Those are about the most accurate numbers we're going to get. Nobody knows what it is in Canada, but I'll come back to one example that I think is extremely telling.
You read the numbers from the RCMP, which have not really had any pirating or counterfeiting cases in respect of consumer goods in over three and a half years, but when they did, the commanding officer in the Toronto area wanted to see how much counterfeit or pirated goods were coming in through the Toronto airport. At that time, in the entire year. the most amount of counterfeit that had come into Canada was in the $30-million range, so he wanted to see what would happen if for six months we answered all the calls we got from CBSA, how much product would there be.
In six months there was over $70 million in counterfeit just from Toronto, and it was everything you could think of. When I say anything and everything, products that we had not even seen counterfeited were being seized through the RCMP. That was Project O-Scorpion and that was, I believe, in 2012-13. Since that time there have been almost no seizures at the border by the RCMP or by customs.
I think that's pretty telling. If you look for it, you're going to find it, and we find the same thing in the marketplace. We just—
Sorry, I didn't know if you wanted more examples.
What keeps me awake at night is that we'll have some well-intended but overly broad regulation that will prevent new and socially beneficial innovations from hitting the market.
What we tend to find in technology is that new technologies come on the market and they are used by consumers in ways that are not originally contemplated. In my testimony I talked about the Sony Betamax controversy where Sony introduced the Betamax, which was a device that allowed people to record television shows. The movie industry took it to court and it ended up in the United States Supreme Court where it was declared a legal product, by one vote. It then became a very popular product.
The irony is that what the movie industry was concerned about was the record button, but what consumers found valuable in the Betamax was the play button. What that did was start a brand new industry in pre-recorded media, such as compact discs and DVDs, which ended up making up the majority of the movie industry's revenues some years out.
Had they been successful in shutting down that technology, they would also have shut down one of their biggest revenue streams. You see that a great deal in technology, where it goes in ways you don't expect.
The general trend is that new technologies open up new distribution platforms, allow access to new consumer groups, and allow new ways to monetize, as you're seeing now on the Internet with the growth of streaming music.
Our advice is always to be very light-handed on the regulation of new technologies because you're not sure what kinds of opportunities in terms of creative opportunities or economic opportunities you may be inadvertently foreclosing.
It was going to be a great 10 seconds.
Mr. Lipkus, I had a piece of legislation that improved CBSA detainment, seize and destroy, and it was on invasive carp. In the past when carp came into Canada, it had to be tested to make sure it was dead. They have so-called zombie-like characteristics. When it was packed in ice, it could live up to 24 hours.
To make a long story short, the Conservatives stole and implemented my bill, which was great because the regulation was that the carp have to be eviscerated so we don't have to have people check to make sure they are alive.
Does your suggestion say the same thing? Can it go through regulation? Can you give a little in terms of detain, seize and destroy? I could see maybe detain and seize, but destroy or sending back probably could be through regulation. Destroy might require some legislation.
That's why I want the legal advice.
I think what you're asking for is a far more complicated process for something on which we could have a simpler solution in the medium and short terms.
I'm not disagreeing in terms of responsibility of it. However, in my opinion, there's low-hanging fruit in your situation that you're advocating, and public health benefits as well, especially with more drugs and so forth now getting into counterfeiting.
At any rate, I'm going to quickly go to OpenMedia.
With regard to your statement about undermining the consultations with the extension of the trade agreement, perhaps you could enlighten us a little more on that. One of the things that has dramatically shifted during these hearings is a trade agreement in principle. We can debate whether it's going to get passed or not, but at the same time, we have agreed that that contains the context, and....
I think that this committee has been tasked with undertaking a review of the Copyright Act. What we've seen is an international trade agreement that is largely focused on physical goods and how they pass across borders, and provides some of the answers to the questions that this committee is asking.
If that trade agreement is passed and does become ratified, one of the concerns we have is that this committee has asked for what people think and how people feel about these issues and, at the end of the day, some of those answers have been deemed irrelevant by this trade agreement.
That's a concern we have about the democratic process, how these trade agreements are being negotiated. As for the NAFTA consultations and negotiations, the results of those consultations were never released to the public. Again, within that, we're having this consultation here, and we still don't know what the NAFTA consultations said. That deal was then moved forward.
Ultimately, all of these deals, all of these negotiations, all these consultations, are supposed to be in the best interests of people in Canada, and we're not certain where their voices are going or how they're being heard.
That's our concern with that being run in tandem to this consultation.
I will just add one thing. I think it may be both. Certainly creators will hopefully change their business model to take advantage of new technologies and the abilities to monetize and reach large audiences. That's a good thing.
I think the one thing that I would caution is that.... Certainly, it's a goal of this committee to broaden competition among Internet platforms. That's a good thing. The whole start-up ecosystem is very dynamic and provides more opportunities for artists and creators.
The route that Europe is taking with these regulations, article 11 and article 13, while well-intended, may have the opposite effect by concentrating the power of larger companies. This is just because some of the regimes, like the filtering regimes that are being mandated, are really expensive and resource intensive. Look at YouTube's content ID as an example. They spent $60 million on it.
Those may be mandates and obligations that larger companies are able to meet, but for somebody who's creating a new company in her dorm room and who has to meet the same kind of obligations, she cannot. That's the kind of result that I think we need to be mindful and careful of.
I want to thank everybody for coming in today.
As you know, we have quite the task ahead of us. There are conflicting stories on either side, and our task, as well as the task of our great analysts who will help guide us to where we need to go, and then we'll blame them later....
Some hon. members: Oh, oh!
The Chair: But, yes, we have definitely been hearing a lot of good information, and we look forward to putting it all together.
Thank you very much, everybody, for coming in.
Thank you, Michael, from Washington.
The meeting is adjourned.