HERI Committee Meeting

37th PARLIAMENT, 2nd SESSION

Standing Committee on Canadian Heritage

EVIDENCE

CONTENTS

Thursday, October 30, 2003

Á

1105

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

Mrs. Pamela Brand (National Executive Director, Directors Guild of Canada)

Á

1110

Ms. Arden Ryshpan (Directors Affairs Manager, Directors Guild of Canada)

Á

1115

Mrs. Pamela Brand

The Chair

Ms. Mylène Alder (Deputy Executive Director, Association des producteurs de films et de télévision du Québec (APFTQ))

Á

1120

Á

1125

Á

1130

Á

1135

The Chair

Mr. Michael Hennessy (Acting President, Canadian Cable Television Association)

Mr. Gerald (Jay) Kerr-Wilson (Vice President, Legal Affairs, Canadian Cable Television Association)

Á

1140

Mr. Michael Hennessy

The Chair

Mr. Ken Thompson (Director, Public Policy and Communications, Alliance of Canadian Cinema, Television and Radio Artists)

Á

1145

Á

1150

Á

1155

The Chair

Mr. James Lunney (Nanaimo—Alberni, Canadian Alliance)

The Chair

Mr. Gerald (Jay) Kerr-Wilson

Mrs. Pamela Brand

The Chair

Mme Mylène Alder

The Chair

Mr. James Lunney

Mrs. Pamela Brand

Mr. James Lunney

Ms. Mylène Alder

Â

1200

The Chair

Ms. Christiane Gagnon (Québec, BQ)

Ms. Mylène Alder

Â

1205

The Chair

Ms. Mylène Alder

Ms. Liza Frulla (Verdun—Saint-Henri—Saint-Paul—Pointe Saint-Charles, Lib.)

Â

1210

Mr. Michael Hennessy

Ms. Liza Frulla

The Chair

Mr. Gerald (Jay) Kerr-Wilson

Mme Liza Frulla

Â

1215

The Chair

Mr. Gerald (Jay) Kerr-Wilson

The Chair

The Chair

Mr. Paul Bonwick (Simcoe—Grey, Lib.)

Mr. Ken Thompson

Â

1220

The Chair

Ms. Wendy Lill (Dartmouth, NDP)

Mr. Ken Thompson

Â

1225

Ms. Mylène Alder

The Chair

Mrs. Pamela Brand

The Chair

Mr. Gary Schellenberger (Perth—Middlesex, PC)

Â

1230

Mr. Ken Thompson

The Chair

Mr. Gary Schellenberger

The Chair

Ms. Carole-Marie Allard (Laval East, Lib.)

Mr. Michael Hennessy

Â

1235

Mr. Gerald (Jay) Kerr-Wilson

Ms. Carole-Marie Allard

Mr. Gerald (Jay) Kerr-Wilson

Ms. Carole-Marie Allard

Mr. Gerald (Jay) Kerr-Wilson

Ms. Carole-Marie Allard

The Chair

Mr. Jim Abbott (Kootenay—Columbia, Canadian Alliance)

Â

1240

The Chair

Mrs. Pamela Brand

The Chair

Ms. Mylène Alder

The Chair

Mr. Michael Hennessy

The Chair

Mr. Ken Thompson

The Chair

Ms. Christiane Gagnon

Mr. Gerald (Jay) Kerr-Wilson

Â

1245

The Chair

Ms. Carole-Marie Allard

Mr. Michael Hennessy

The Chair

Mr. Gerald (Jay) Kerr-Wilson

Ms. Carole-Marie Allard

Mr. Gerald (Jay) Kerr-Wilson

The Chair

Ms. Wendy Lill

Mr. Ken Thompson

Â

1250

Ms. Wendy Lill

Mr. Ken Thompson

The Chair

Ms. Liza Frulla

Mr. Gerald (Jay) Kerr-Wilson

The Chair

Â

1255

Mr. Gerald (Jay) Kerr-Wilson

The Chair

Mr. Gary Schellenberger

Mr. Michael Hennessy

The Chair

Mr. Ken Thompson

The Chair

Mrs. Pamela Brand

Ms. Mylène Alder

The Chair

Ms. Carole-Marie Allard

Mrs. Pamela Brand

Ms. Carole-Marie Allard

Ms. Arden Ryshpan

Mr. Ken Thompson

·

1300

Ms. Carole-Marie Allard

Mr. Michael Hennessy

The Chair

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CANADA

Standing Committee on Canadian Heritage

---

NUMBER 055

l

2nd SESSION

l

37th PARLIAMENT

---

EVIDENCE

Thursday, October 30, 2003

[Recorded by Electronic Apparatus]

Á  (1105)  

[English]

    The Chair (Mr. Clifford Lincoln (Lac-Saint-Louis, Lib.)): I'd like to call to order the meeting of the Standing Committee on Canadian Heritage,

[Translation]

    which is meeting today to continue its review of the Copyright Act,

[English]

in connection with its review of the Copyright Act.

    We are very pleased today to welcome four groups. From the Directors Guild of Canada we have Mrs. Pamela Brand, national executive director; and Mrs. Arden Ryshpan, directors affairs manager. From the Association des producteurs de films et de télévision du Québec (APFTQ) we have Madam Mylène Alder, directrice générale adjointe. From the Canadian Cable Television Association is Mr. Michael Hennessy, acting president; and Mr. Gerald Kerr-Wilson, vice-president, legal affairs. Finally, from the Alliance of Canadian Cinema, Television and Radio Artists is Mr. Ken Thompson, director, public policy and communications.

    Welcome to all of you. I will give the floor to Madam Brand.

    I guess the clerk has explained to you we are trying to limit the presentations to around 10 minutes each to give time to members for questions.

    Mrs. Pamela Brand (National Executive Director, Directors Guild of Canada): Good morning, Mr. Lincoln, and members of the committee.

    The Directors Guild of Canada is a national labour organization representing over 3,800 key creative and logistical personnel drawn from all areas of directing, production, design, and editing of film and television in Canada. Among our members are nearly 500 film and television directors.

    Arden and I are also here to represent the Directors Rights Collective of Canada. The DRCC is a non-profit organization established in 1998 by the DGC to act as a collecting society. Currently, the DRCC collects private copying levies from various countries in Europe on behalf of its director members.

    The committee has said that it wants our comments on the government's proposed copyright reform agenda--the adequacy of the list of issues, the timeframe for action, and the principles that should guide the process. We do have views. The guild has been heavily involved in the process of copyright reform and has seen the good, the bad, and the ugly.

    We participated actively in the process leading to the passage of Bill C-32 in 1997, and in the consultative processes over the last number of years concerning the implementation of the WIPO treaties. We contributed significantly to the discussion surrounding the issues of Internet retransmission--the iCrave TV issue--and the ultimate amendment of the Copyright Act that ensued.

    We are members of the Copyright Coalition of Creators and Producers, and the Creators’ Rights Alliance, both of which lobby for change. We are partners in the effort to develop a facility for electronic copyright management of audiovisual works, starting with the implementation of the ISAN.

    Our members' livelihoods are entirely dependent upon sound copyright law and administration, so we're committed to making the reform process work. To that end, we have seven points to make about the government's copyright reform agenda.

    First, we ask you to consider rolling copyright reform; that is the treatment of issues in small, thematically consistent packages rather than in comprehensive omnibus bills. We believe that the government must take an analytical approach if we are to achieve this successfully.

    Some issues lend themselves to discrete treatment because of their narrow industry focus. Several recent issues, such as the Lucy Maud Montgomery amendment, were addressed because of real deadlines, the serious impact these issues would have on the industry, a high degree of hard-won industry consensus, and a clearly defined focus on the part of both government and the industry.

    Some issues may be discrete, such as the issue of the authorship and ownership of copyright and photographs, but are linked to other issues by their inclusion in a WIPO treaty.

    Other issues are not discrete. They affect all or many of the copyright industries because they represent a fundamental change in copyright concepts. They are by their nature large scale. The WIPO digital agenda, ISO liability, digital access and exceptions, and collective management of copyright are of this kind. But they are, with the exception of collective management, in the short-term tier of the government's reform agenda. This is holding up the addressing of some of the simpler issues in the second mid-term tier, such as the question of audiovisual authorship and related reforms.

    We don't dispute the first importance of implementation of the WIPO treaties--far from it. We need WIPO. We endorse its critical importance and urge the work to go forward with all speed. With more manpower strategically deployed, smaller matters in need of reform could be handled concurrently rather than being left to languish in a steadily receding mid-term.

    The timeframe for action, as set in years from the date of the report, is already only of historical interest, as it cannot realistically be met. The government should consider hiring consultants to assist in the work. Failure to update the laws, particularly in implementing the digital agenda, results in lost opportunities for the copyright industries. Moreover, for individual industry organizations, the expense of ongoing consultations and submissions without results is increasingly difficult to afford. We need to find a way to speed up the process.

Á  (1110)  

    The report relegates to the long-term tier issues that are currently being considered on an international treaty level at WIPO, such as traditional knowledge, databases, and rights in audiovisual performances. We think it is right to wait for international consensus to develop before legislating in such areas, with the caveat that domestic needs or legal developments, such as court cases dealing directly with the issue, may necessitate legislative amendments before such international consensus emerges. If important policy is being set on the international stage, the government must stay involved itself and must continue its efforts to keep Canadian stakeholders informed and involved before the policy train leaves the station.

    Rolling copyright reform demands focus and leadership. The joint responsibility for the copyright portfolio between Industry and Heritage may not serve us well. While this is not strictly speaking an issue of copyright reform, it is intimately tied to how effective the reform process can be.

    It has long been a mantra that the Copyright Act should be drafted in technologically neutral language. Our recent experience in the Internet retransmission case suggests that this mantra should be analyzed more carefully. Whereas the definition of rights, works, and other subject matter should be couched in technologically neutral terms, most exceptions, apart from fair dealing, are in response to particular technologies and market failures. The justification for and scope of any given exception are dependent on the underlying technology. Where the facts justifying an exception are technology-specific, the language should be too.

    We note the identification of the need to balance users' calls for clear and fair rules of access with rights holders' entitlement to remuneration and control. Rights holders who seek to commercially exploit their works seek control in order to disseminate and provide access to the mutual benefit of themselves and users. Control and the provision of access are not necessarily opposites or opposed. Statutory recognition of the author is compatible with the producers' need to control and exploit the work. This must not be lost sight of amid the rhetoric.

    Finally, we wish to address the audiovisual agenda directly. At this point I'm going to turn things over to Arden.

    Ms. Arden Ryshpan (Directors Affairs Manager, Directors Guild of Canada): The issue of who the author is of an audiovisual work is fundamental to our industry, and I want to underscore how important this is to our director members.

    For years, the guild has been lobbying the government for the statutory recognition of directors and screenwriters as the authors of audiovisual works. The report mentions that a variety of creative personnel, and in a couple of cases the producer, are statutorily recognized as authors in other jurisdictions. What the report fails to mention is that the common denominator, with the exception of the United States, is that the director is an author.

    Gaining recognition as authors is important to the industry for a number of reasons. International levy systems, such as that of private copying or retransmission royalties, typically divide such levies between authors and producers. The lack of statutory recognition of directors as authors has complicated the work of the DRCC in collecting amounts segregated for directors in foreign jurisdictions. The consequent delays have already cost Canadian directors much in lost remuneration.

    This lack of clarity has resulted in the lack of a division of retransmission royalties between producers and authors in our own jurisdiction--a continuing inequity. If in the future Canada implements a private copying regime or any similar regime to provide remuneration for unauthorized use of audiovisual works, the statutory recognition of the director and screenwriter as co-authors would help to ensure they were not forgotten in setting entitlement to such remuneration.

    The lack of identification of the author leaves a couple of matters in doubt. It calls into question how to calculate the proper term of copyright for many audiovisual works in Canada. Our act provides that for cinematographic works in which the arrangement, acting form, or combination of incidents represented give the work a dramatic character, the term of copyright protection is the life of the author plus 50 years. Without a defined author, how long is the work protected?

    These questions of ownership and how to protect it in the face of constantly changing technologies cannot be treated simply as intellectual arguments, or as being of concern to only multinational entertainment conglomerates. The problems created by these issues are becoming increasingly practical. For example, you may be aware that the MPAA, run by the notorious Jack Valenti, has placed a ban this awards season on what are commonly known as screeners, due to piracy concerns. These are tapes, or more frequently now DVDs, of films sent out to the multitude of people eligible to vote for one set of awards or another. These screeners are often the only way to see smaller films--meaning not studio-backed--since they're not available easily at your local cineplex. Denys Arcand's new film Les invasions barbares is being touted as a leading contender for an Oscar nomination for best foreign language film. But if no one can see it, no one will vote for it.

    The issues we are talking about today have a trickle-down effect, and that trickle-down effect may deprive one of Canada's best filmmakers of a shot at the ultimate level of international recognition--an Oscar. We cannot stress enough the profound economic effect of this legislation on our membership. It also calls into question just who is entitled to moral rights, which is a matter of great concern as well to many of our members.

    In the past three years, two of our directors have had their works changed after completion of their projects. In both instances, the directors believed that the changes did not reflect their visions of the works they had directed. Both sought to remove their names from the completed works and insert pseudonyms, as they felt the works as completed would be injurious to their reputation as directors. In both instances, they were unable to do so because they were not considered to be authors of their works.

Á  (1115)  

    Mrs. Pamela Brand: Thank you, Arden.

    There are other audiovisual issues that must be added to the list of issues, in particular, the need to update the definition of cinematographic work, a technologically obsolete term that moreover takes considerable practice to even pronounce. However, this is a technical, if important, issue.

    We believe that the film and television industry could, with government assistance, largely resolve these issues. We would like to see them given priority on the government's agenda.

    Those are our points. Thank you for your time. We're looking forward to addressing any questions you may have.

    The Chair: Thank you very much, Mrs. Brand and Mrs. Ryshpan.

[Translation]

    I would now like to give the floor to Ms. Alder from the Association des producteurs de films et de télévision du Québec.

    Ms. Alder.

    Ms. Mylène Alder (Deputy Executive Director, Association des producteurs de films et de télévision du Québec (APFTQ)): Thank you to all the members of the committee. Thank you, Mr. Chair, for inviting the Association des producteurs de films et de télévision du Québec to meet with you this morning.

    At the request of your committee, the APFTQ reviewed the Copyright Act reform agenda recommended by the government in the document Supporting Culture and Innovation: Report on the Provisions and Operation of the Copyright Act. The APFTQ and every organization here this morning were asked specifically to assess the comprehensiveness of the list of principle issues identified, the guidelines, the projected sequence and the timeframe for the reform.

    Briefly, the APFTQ represents more than 120 independent film and television production companies from Quebec that work both in French and English producing dramas, documentaries, youth programming, variety shows, magazines, animation and commercials. APFTQ members produce the vast majority of the Canadian production volume generated by independent producers from Quebec, which in 2002-03, represented some $860 million.

    The APFTQ and its members work in a unique legislative context since they are subject to provincial labour relations legislation with respect to film and television, namely the Act respecting the professional status and conditions of engagement of performing, recording and film artists. I mention this because of the distinctive features involved. In this context, the APFTQ negotiates multi-employer collective agreements with artist associations and technician unions, including the DGC and ACTRA, who are present this morning. These agreements cover a hundred or so artist positions that are recognized under the provincial legislation. Once these agreements are in place, the APFTQ member producers must respect them.

    On September 15, 2001, the APFTQ submitted a brief to the government regarding the changes it would like to see made to the Copyright Act. The positions expressed therein are still valid and were summed up in a document sent to your committee in September. I believe you all received a copy. I included the document with the text of my remarks for reference. Many of the proposals address problems listed in the government report, but given the time constraints this morning, I will focus on the problems that we feel are the most important and urgent for our industry. I would like to point out that we stand by the other points, although we are not addressing them this morning for lack of time.

    The APFTQ shares the government's view that any reform of the Copyright Act must seek a balance between its two main objectives of offering adequate protection to the creator of cultural content and ensuring that Canadians have appropriate access to the works. Moreover, we find it very appropriate that the government has added a third objective to serve as a guideline, namely to act as an important lever to stimulate innovation, entrepreneurship and success in the new knowledge-based economy.

    Also, we feel that the government's objective of reforming the Copyright Act in order to make it one of the most modern and progressive in the world is perfectly commendable.

    However, we would be remiss in not pointing out the inconsistency between this objective and the following observation: Canada is currently the only Western nation that has yet to clarify the issue of copyright ownership of audiovisual works. Indeed, as indicated by the government in its report:

The Act does not currently identify the author of a cinematographic work (i.e. film). A long-standing issue is who should be considered the author or authors of such a work (e.g. director, producer or screenwriter).

    I stress the term long-standing.

    From the Quebec film and television industry's point of view, the Canadian Copyright Act is not one of the most modern, since conflicts still arise here today that were resolved several decades ago in other Western nations. Such conflicts necessarily result in significant costs for the producers, in addition to compromised exploitation rights for our productions, for which chains of title remain, for all intents and purposes, uncertain: the producer has to negotiate licences or assignments of rights he presumes exist since there is no clear identification in the current legislation.

Á  (1120)  

    In its report, the government indicates the following:

Rights holders are looking for confidence in the protection of their material in an on-line environment. At the same time, users call for clear and fair rules of access and use of Internet content.

    However, the fundamental questions concerning film and television productions remain: Who are these right holders and to whom does the content belong? One thing is certain, as far as we are concerned: audiovisual producers want to be confident that their productions are well protected in an online environment and that they can continue to control how they are used in such an environment.

    Consequently, with respect to the recognition and protection of works and other subject matter, it appears to us to be of the utmost importance that the issue of authorship of films and videos be addressed and determined in the very near future; by very near future, I mean as the very next step. Clarifying this will greatly improve the situation our industry is currently facing. Eliminating uncertainty about who should be considered the author or authors will necessarily have a positive impact internationally for producers, from both an economic and strategic standpoint.

    Without taking a stance on the determination of the identity of the author or authors of an audiovisual production, since the APFTQ is required by law to maintain working relationships with 11 artist associations and unions, we recommend that the government at the very least provide a neighbouring right in favour of the producer of this type of production, supplemented by a presumption of assignment of the rights of the author or authors in favour of the producer. This proposal has the merit of not putting too much emphasis on the identity of the author, but at the same time it mitigates the increasing negative effects of the unclear present situation. The determination of the identity of the author or authors of a film or video production under the act presently relies on a specific evaluation of the creative contribution of everyone involved. This process entails a degree of subjectivity since the determination of what constitutes a creative contribution varies from one person to the another. You will notice it, because everyone who will appear before you during these proceedings will tell you that they are the authors. It goes on and on, which goes to show how subjective this process is.

    As mentioned, one of the main consequences of this ambiguity is the precariousness of the chain of title. Imagine a producer omitting, in good faith, to obtain licences or assignments of rights from a person having participated in the production of a film, and a tribunal subsequently recognizing this person as a co-author! It would be disastrous. It is absolutely realistic to say that this could happen at present. Only a presumption of assignment in favour of the producer entrenched in the Copyright Act could prevent this kind of situation.

    Furthermore, the costs related to this uncertainty are, for all practical purposes, borne entirely by producers who obtain more rather than less rights, and therefore pay more rather than less, in order to make sure that they do not have any bad surprises, or as few as possible, when their audiovisual works are used.

    The Copyright Act has recognized neighbouring rights for sound recording producers for many years. As indicated in the government's report, these rights are, and I quote:

—provided to acknowledge the investment and artistic effort that goes into making a record.

    Yet, this investment is, on average, clearly less significant than the investments that go into film and television productions.

Á  (1125)  

    For the past three years, the average cost of a sound recording in Quebec has ben approximately $60,000, according to the figures I have just obtained from SODEC, whereas the average budget for a feature film in Quebec in 2001-02 was around $3.4 million. According to the latest Telefilm Canada report, the average feature film budget was $3.6 million, . So we are talking an average investment six times greater than for a sound recording. There is, however, no legislative safety net in place at the present time for those producing audiovisual recordings, yet there is one for sound recordings.

    As for the urgency created by the new digital reality, the APFTQ finds that the government's report neglects to stipulate that it also extends to works on film and television, and therefore not only to literary text, pictures, drawings, sound recordings, videoclips and software.

    As Mrs. Brand of the Directors Guild of Canada has just reminded you, moreover, today we can indeed affirm that the new digital reality is increasingly affecting the movie and television industries. Examples of this include ICrave TV, to which my colleague has referred, and Jump TV, which retransmits broadcast signals, and therefore TV content, over the Internet.

    I might also point out that it is possible at this very moment to obtain copies of such films as Les invasions barbareson downloading web sites such as Kazaa.com or Morpheus.com absolutely free of charge, or for the ridiculously low sum of $1 or $2 dollars a month. This is a serious situation and one that is increasingly worrying copyright holders, since it is likely to compromise the way our industry operates and has the potential to deprive them of significant amounts of revenue.

    In 2002, close to 20% of teenagers in Quebec admitted to downloading films off the Internet, and this activity ranked as the eighth most popular Internet activities for that age group. In Canada, in 2002 also, this proportion was higher still: 35% of the 12 to 24 age group. Another interesting statistic in this connection is that, in 2002, 50% of Canadian households owned a DVD player, compared to only 1% in 1998.

    This new technological reality militates in favour of the immediate establishment of a private copying regime for the recording of film and audiovisual productions in Canada similar to the one already in place for sound recordings. The lack of such a regime in Canada leads to a major loss of earnings for producers, writers and performing artists involved in these audiovisual works. As well, it prevents producers from collecting royalties in a number of foreign countries that offer such regimes because of the principle of reciprocity.

    The APFTQ has been waiting for some years for clarification of the issue of ownership of copyright in film and video, as well as for the establishment of a private copying regime in the audiovisual field. These issues were included in the agenda for Phase II of the modifications to the Copyright Act during the 1990's. They were, in the end, postponed to Phase III.

    The office of the Minister of Canadian Heritage confirmed to us in a letter dated November 28, 1997, that these two questions were part of the elements to consider in view of the next phase of amendments to the act, that is this one, not the next. Yet not only has the issue of private copying in the audiovisual field not been directly addressed in the government's report, but now the issue of copyright ownership has once more been postponed to a later phase, the medium term, that is in two to four years.

    We are deeply disappointed with this proposal and hope that the government will agree to keep its promise to settle these questions during the next phase of the amendments.

    The APFTQ acknowledges that issues relative to the digital era must be treated as a priority in the reform agenda. How then can the government conclude that questions related to access and educational use, implying the adoption of new exceptions and broadening of the present ones, are more urgent than those linked to the ownership of copyright in film or video production or at least the assurance of a minimum of protection to the producers of these works? Does public access to these works merit greater zeal than protecting the rights of creators, including those of producers?

Á  (1130)  

    Similarly, we note that the issue of copyright ownership of photographs appears in phase one of the review. How can it be more urgent to settle this question? The economic consequences , whether the amounts of money at stake, or foreign production or operation partnerships, as well as the number of people affected, are far less significant for photography than for film and video. Moreover, it seems to us that this debate is far more recent than that relating to audiovisual production.

    In conclusion, the APFTQ agrees with the general guidelines set out by the government in its agenda for copyright reform. However, we note that the list of principal problems is incomplete; there is nothing about the private copying regime in the audiovisual field. In addition, the course proposed in the reform agenda does not strike us as adequate. It is our fervent wish that the issue of ownership of copyright in audiovisual works, including the adoption of neighbouring rights for producers of audiovisual works and the presumption of assignments of authors' rights in favour of these products, will be part of the next phase of amendments to the Copyright Act. Likewise, the establishment of a private copyright regime for audiovisual works must be envisaged in the very short term.

    The longer we wait to settle this question, the more revenue will be lost by producers, authors and audiovisual performers. The APFTQ sincerely believes that these questions are as urgent as those related to the digital era in which these works will be exploited in future, if not more urgent. Who will be served by settling the issue of use, if we do not determine who may authorize or refuse this use and who will benefit from it?

    Thank you.

Á  (1135)  

[English]

    The Chair: Thank you.

    Mr. Hennessy.

[Translation]

    Mr. Michael Hennessy (Acting President, Canadian Cable Television Association)

    Thank you.

    My name is Michael Hennessy, and I am the acting president of the Canadian Cable Television Association. With me today is Gerald Kerr-Wilson, Vice-President, Legal Affairs, for the CCTA.

[English]

    On behalf of the CCTA, I'd like to thank Mr. Bourgault and the committee for accommodating us this week in an already very busy schedule.

[Translation]

    The CCTA is a founding member of the Balanced Copyright Coalition.

[English]

    The Balanced Copyright Coalition partners include public interest advocates; major telecommunications, broadcasting, and technology companies; as well as several prominent academics. The communications sector businesses alone, represented by the associations or the coalition members, generate about $45 billion a year in economic activity, and directly employ 95,000 Canadians.

    You've asked witnesses during this initial stage of the committee's review to comment on the government's recommended copyright reform agenda, as set out in the section 92 report.

    In addition to providing cable television services to more than six million Canadian households, the members of the Canadian Cable Television Association also provide broadband Internet access services to more than two million households across all regions of Canada. These networks form the backbone of the government's connectedness agenda, and are the platforms that will deliver a full range of communications, data, and entertainment services to all Canadians.

    The success of the Canadian ISP industry in building up these networks has been, to say the least, remarkable. At the end of last year, 85% of Canadians had access to broadband Internet service, and 28% of all Canadian households actually subscribed to a broadband Internet service. As a result, Canada ranks second in the world behind only Korea in the rate of broadband Internet penetration, and cable companies provide the majority of these broadband connections.

    It's for that reason that our industry is keenly interested in the process of copyright reform, to reflect the realities of this digital environment.

    Mr. Gerald (Jay) Kerr-Wilson (Vice President, Legal Affairs, Canadian Cable Television Association): We support the government's decision to prioritize the copyright reform process into short-, medium-, and long-term issues, and generally speaking we agree with the government's classification of the issues into the three categories.

    The government has correctly recognized that copyright reform is by necessity an ongoing process; it is simply not productive to try to deal with all of the possible issues at the same time. It is vitally important, however, that issues that are inextricably linked be dealt with at the same time, as a cohesive package.

    As the government has recognized in developing its short-term agenda of issues, we cannot amend the Copyright Act to satisfy the requirements of the WIPO Internet treaties without dealing comprehensively with the need to limit the liability of ISPs. Limitations to ISP liability and WIPO treaty implementation are both components of the digital copyright agenda. To proceed with WIPO implementation legislation without dealing at the same time with limitations to ISP liability would put many existing businesses at risk. It would seriously threaten the continued widespread deployment of broadband networks in Canada. We could lose many of the gains we have already made.

    These conclusions are not unique to Canada. The only two G-7 countries that have ratified the WIPO treaty so far, the United States and Japan, have incorporated comprehensive safe-harbour provisions for ISPs in their legislation. Europe and Australia adopted explicit limitations on ISP liability even before ratifying the WIPO treaties. New Zealand is in the process of amending its legislation, and limitations on ISP liability are part of that government proposal. Policy-makers in these jurisdictions clearly understand that it simply does not make sense to create new rights to reflect the digital environment that expose to potentially crippling copyright liability the transmission networks that are necessary to deliver digital works.

    On October 23, this committee passed a motion calling on the ministers of heritage and industry to direct the two departments to deliver draft WIPO implementation legislation for the committee's review by February. As members of the Balanced Copyright Coalition, we have written to the committee and to the ministers to express our concerns about this motion. We are concerned because the motion appears to direct the government to isolate WIPO implementation from the other short-term issues for immediate legislative action. As we have tried to explain, the issues arising from WIPO implementation and the need to limit the liability of ISPs are inextricably linked.

    We are also concerned because the motion seems motivated by the impression that Canada is falling behind the rest of the world because it has not yet ratified the WIPO treaties that were signed in 1997. It is clear, however, that far from falling behind, Canada is in step with most of the industrialized world.

    While 42 countries have ratified the two treaties, the U.S. and Japan are the only two G-7 countries that have done so. Many of the others are developing nations with almost no Internet presence. In fact, more than 100 countries that are parties to the Berne Convention have yet to ratify the two Internet treaties.

Á  (1140)  

    Mr. Michael Hennessy: Ratification of the two treaties is a complex process, and will have a widespread and profound impact on a broad spectrum of stakeholders and the public at large.

    Governments around the world are proceeding carefully because they want to get it right. They're trying to satisfy the requirements of the treaties, but at the same time maintain an appropriate balance between rights-holders, copyright consumers, and the public interest. One need only look at the United States and its Digital Millennium Copyright Act to understand the dangers of legislating before all of the issues are fully understood, and without taking into account all the various interests.

    Canada has every reason to be very proud of its accomplishments in adopting new technology and leading the charge in the digital future, and we're proud to be a part of that. The key to our continued success is a stable regulatory environment, and that includes appropriate limitations on ISP liability--safe harbour.

    To implement legislation that does not accomplish these goals would, as Jay said, impose crippling obligations on ISPs who today give Canadians access to the world, and the world access to Canada through broadband and dial-up Internet service.

    Thank you very much.

    The Chair: Thank you very much, Mr. Hennessy and Mr. Kerr-Wilson.

    Mr. Thompson.

    Mr. Ken Thompson (Director, Public Policy and Communications, Alliance of Canadian Cinema, Television and Radio Artists): Good morning, Mr. Chairman, and honourable members of the committee.

    The Alliance of Canadian Cinema, Television and Radio Artists, ACTRA, which represents 21,000 Canadian professional performers working in the English language recorded media in Canada, thanks you for this opportunity to present our views to the committee.

    This year ACTRA celebrated its 60th anniversary. ACTRA is a vocal advocate for preservation and strengthening of Canadian culture and Canadian creativity. ACTRA plays a leading role in coalitions for the advancement of Canadian cultural programs, and in international bodies working for the protection of cultural diversity in a global economy. ACTRA has taken a principal role in the advancement of performers' rights in the process of copyright reform domestically and internationally.

    We are very pleased to have the opportunity to speak to you today in these preliminary consultation hearings about the important issue of the government's agenda for copyright that goes to the heart of protecting our cultural expression and our national identity.

    Before I go further, I'd like to commend this committee on the motion it made last Thursday to put forward the WIPO treaties, and to encourage the government to move forward with draft legislation. The WIPO treaties are not an end unto themselves, but they're a beginning. They will create the foundation for a digital copyright law in Canada.

    If we are to achieve our creative promise, artists must be compensated properly for their efforts. A critical element in achieving this objective is the copyright system that provides both economic and moral rights to creators. A fundamental principle upon which ACTRA bases its representations concerning copyright and performing artists is that since the performance adds value to the artistic work and can give life and grandeur to the script, the work of the performer deserves to be protected by copyright law.

    Because the government's copyright reform agenda, set out in chapter 3 of “A Framework for Copyright Reform”, relegates performers' rights to the third tier of long-term legislative amendments, we are concerned that the rights of audiovisual performers will continue to lag well behind other creative stakeholders. Given the speed of technological change in our industries and the effect such change has on our ability to protect performers, failure to provide a comprehensive set of rights in the next phase of the reform agenda may prove fatal. We ask you to recommend that performers' rights be addressed in the review of the copyright issues in the same grouping as protection of authors' rights and audiovisual works.

    In the absence of statutory recognition of rights for performers, Canadian unions have used collective bargaining to provide rights to audiovisual performers that are equivalent to copyright protections enjoyed by colleagues in other countries. In the present context, ACTRA negotiates and administers agreements with all of Canada's significant media producers to cover the work done by actors, singers, dancers, vocal artists, hosts, announcers, stunt performers, variety artists, and other performers.

    The agreements negotiated between ACTRA and the producers establish appropriate working conditions, contractual requirements, and minimum fees for ACTRA members. The important agreements cover movies and television programs of Canada's independent producers and those filming foreign works in Canada, new media developers, producers of television and radio commercials, the Canadian Broadcasting Corporation, CTV, CanWest Global, and the National Film Board.

    The agreements typically provide for the right of producers to use recorded performances in defined markets in Canada and around the world for defined periods of time. They require the payment of additional fees, in the form of fixed residuals or royalties, when the work is used beyond these markets or these time periods. These additional fees recognize the performer's creative and economic contribution to the film, television or radio program, sound recording, or new media work. The agreements also acknowledge other contractual rights that performers have in their work, including limits on how the recorded performance can be excerpted, edited, or included in new programs or films.

    In order to enforce the rights ACTRA has negotiated in these agreements and to administer the neighbouring rights royalties provided by Canadian and foreign laws to performers in audio works, the ACTRA Performers Rights Society was established in 1984. The PRS has legal authority to operate as a collecting society, and to manage collectively the rights of its members.

Á  (1145)  

    For many years, these arrangements worked well for Canadian performers. Major broadcasters were responsible for Canadian audiovisual productions. There was little distribution outside Canada or the traditional markets of cinema and television, or music and video stores. The technologies used to produce, distribute, and broadcast the works were expensive and bulky. ACTRA could therefore monitor the uses being made of the works, and generally ensure the contractual provisions were implemented. In addition, the technologies needed to make copies of recorded performances and enable easy manipulation of the work were unavailable, or beyond the means of individual citizens.

    All that has changed dramatically in the past 20 years. Independent producers create the bulk of production in Canada today, using complicated business models and partnerships to enable them to organize the necessary financing. In addition, new technologies make it possible for the works to be distributed instantaneously around the world in digital format. Perfect reproductions of the works can be made by anyone with a basic computer, and it is possible to manipulate works in ways not intended by the creators of the works.

    In 1997, the government amended Canada's Copyright Act to provide certain minimum rights to audiovisual performers, including the right to enforce contractual residual fees against third-party users of the works. But these amendments merely laid the foundation for resolving the most egregious problems associated with these profound changes, and did not address the challenges of new media and digital communications.

    The global reach of digital communications and new media applications make it increasingly difficult for performers to rely on contractual provisions alone, without underlying rights in copyright to bolster their agreements with producers of audiovisual works. Internationally recognized rights of performers in their performances in audiovisual media would not only assist performers to access royalties from third parties, but would permit performers to enforce the protection of their performances fixed in audiovisual media against piracy and unauthorized manipulation.

    The twin challenges of new media application for performers' performances fixed in audiovisual works, and the ease with which digital technology can be misused to expropriate creativity without right and compensation were the impetus to strive for an international treaty to address rights of performers in audiovisual works.

    There remains a continuing dialogue to create such an international treaty for the protection of performers' rights in audiovisual that was initiated with the Rome Convention in 1961. The World Intellectual Property Organization, WIPO, convened a diplomatic conference in 2000 that addressed new rights for performers for developing digital technologies and new media. Unfortunately, although that diplomatic conference reached consensus on 19 articles under negotiation, it did not conclude a treaty because final agreement was not reached on a remaining 20th article.

    The dialogue for that international treaty is to be renewed next week, when the general assembly of WIPO will convene an ad hoc meeting to renew the progress of completing such a treaty for international recognition and protection of performers' rights in films, audiovisual works, and other new media.

    Changing the government's copyright reform agenda to include performers' rights in audiovisual works in the same grouping as protection of rights in audiovisual works for creators would not be inconsistent with Canada's ongoing participation in the WIPO discourse and negotiation of a treaty for performers' rights in audiovisual works. This important meeting at WIPO should reinvigorate the process to complete the work of concluding an international treaty for performers' rights in audiovisual works. Canada has a history of contributing to the WIPO process, and has the opportunity to continue its important contribution at this upcoming session.

    ACTRA submits that developments have reached the stage where it is essential to complete the process started six years ago and provide a comprehensive set of rights for audiovisual performers. This will create a legal environment appropriate for the current production, distribution, and exhibition of audiovisual works. Including the performers' rights in audiovisual works with the other issues involving the production of creators' rights in audiovisual works will meet the government's aims to provide better copyright protection, and ensure that the Copyright Act remains among the most modern and progressive in the world.

Á  (1150)  

    The performer's performance is integral to the creation of an audiovisual work, and therefore it is appropriate and necessary that performers' rights in audiovisual works are considered in the same agenda grouping as protection of creators' rights in audiovisual works, including multimedia works. We submit that including the rights of performers' performances in this grouping fits with the government's reform agenda “that deals with issues packaged together according to a common thematic denominator for which policy work and legislative change can be reasonably and effectively achieved in a balanced, step-by-step manner.”

    We request that you recommend that the government amend the copyright reform agenda to group performers' rights in audiovisual works as an agenda item with the other copyright issues in audiovisual works, and that this grouping be placed in the agenda to follow the WCT and WPPT implementation issues.

    Thank you for providing this opportunity for ACTRA to voice its concerns and offer its recommendations in what we think is a very important process. I welcome your questions and look forward to the discussion.

Á  (1155)  

    The Chair: Thank you, Mr. Thompson. I'll open the floor to questions.

    Mr. Lunney.

    Mr. James Lunney (Nanaimo—Alberni, Canadian Alliance): Thank you, Mr. Chair.

    I would like to thank all of the presenters for entering into this dialogue with us. It's a very complicated issue and very important to a lot of Canadians, obviously.

    By way of getting started, I'd just like to put a question out to you. One of the criticisms directed toward the government's management of copyright issues is the fact that we seem to have two ministers with jurisdiction in this area. Do you see as an issue the fact that both the Canadian heritage and industry ministers seem to have some jurisdiction in this realm? If you do, where do you feel that should be resolved? Does anybody want to bite on that one?

    The Chair: Mr. Kerr-Wilson.

    Mr. Gerald (Jay) Kerr-Wilson: There are probably two considerations in the management of the copyright portfolio--one practical, and one philosophical. From a practical point of view, there are obviously issues in having two departments and two ministers, with the departments trying to reach consensus on issues before legislation is brought forth. So from that point of view there are delays and struggles.

    However, from a philosophical point of view the division does sort of reflect the balance that's supposed to be in the Copyright Act. The department of heritage has a cultural mandate to make sure the act reflects the need to preserve creative works, and the industry department has a sort of economical and industrial mandate to preserve it, to make sure there is access and that technological issues are looked after.

    The two perspectives are very important, and I think we'd hate to lose that balance. If trying to make a more efficient copyright reform process means handing the portfolio to simply one or two of the other existing departments I don't think that's the solution, because we'd lose a very important perspective one way or the other.

    I know this committee has talked about whether there should be some sort of rebirth of the communications department, to bring both perspectives together under one department and one minister. That may be a way to address the situation.

    Mrs. Pamela Brand: I agree with Mr. Wilson about the practical concerns. It's very difficult to communicate with two distinct departments. There is a disconnect, and this delays the process.

    As to the point that was raised about the economic and creative issues, we don't believe they are distinct and separate. They are tied together because one flows from the other. So we believe it would be helpful to have both under one department.

    The Chair: Madame Alder.

[Translation]

    Mme Mylène Alder: My position is along the same lines as Mrs. Brand's. I would therefore like to point that, in the case of the APFTQ, broadcasting falls under Industry, while copyright comes under another department. Frequently, the two different laws have to be taken into consideration. It would, therefore, be obviously more practical for us if both elements came under the responsibility of one and the same department.

[English]

    The Chair: Mr. Lunney.

    Mr. James Lunney: Thank you.

    Mr. Kerr-Wilson suggested they be brought together under a separate department called communications. You both suggested one department. Should it be Industry, Canadian Heritage, or a new department of communications?

    Mrs. Pamela Brand: Either way would work for us. A new department of communications would be fine. I wouldn't choose between Heritage and Industry, but one department would be helpful.

    Mr. James Lunney: Okay. Thank you.

    Madam Alder, in your presentation you talked specifically about the audiovisual sector and whether the author was the director, the publisher, or the screenwriter. You made a statement that these conflicts were settled tens of years ago in other western nations.

    Can you give examples of such nations, or are those the G-7 nations that Mr. Kerr-Wilson referred to, being U.S. and Japan? If so, could you just summarize for us how this issue was satisfactorily resolved?

[Translation]

    Ms. Mylène Alder: I do not have the list with me, but I do have a table that gives somewhat of a summary of what has been done. They are not exactly the same. As far as France, England and Germany are concerned, these questions have been settled there. The APFTQ proposal is somewhat along the lines of what is being done in France. French law considers various individuals to be the deemed co-authors of the work, and provides neighbouring rights for producers of audiovisual works. The producer is deemed to have had the rights necessary to exploit the work transferred to him. That is a fairly concrete example.

    In other cases, as Mrs. Brand has said, the director is presumed to be the author. In some others, the producer is. Then there is the U.S.—we do not need to go any further away than that—where the legal process is a bit more complex. Nevertheless, to all intents and purposes, it is the producer who has the rights. There are many countries, as I have already said.

    We in the APFTQ find it odd, moreover, that Canada is actively involved in WIPO diplomatic conferences, when the audiovisual is involved, while Canada is just about the only country that has not resolved that issue. It is obvious that producer's rights are never on the agenda, because this is not a problem for anyone except Canada. In previous consultations, I have indicated that I felt it was more appropriate to settle this matter before proceeding any further with WIPO. If the committee would like, I can get my office to send you a table on the various western countries.

  (1200)  

    The Chair: Yes, that would be appreciated. Could you send it to the Clerk, please?

    Ms. Gagnon.

    Ms. Christiane Gagnon (Québec, BQ): Thank you. My question is for Ms. Alder of the APFTQ.

    You describe yourself as impatient and say that the committee is not giving sufficient priority to the recognition of neighbouring rights for the producer. You say there is a lot of money at stake. I would like to have a ballpark figure, since legislation has not yet been passed. That is my first question.

    My second is this: I would like to understand the transfer of rights to the producer. Does this mean that the artists and directors who have contributed to the work would be deprived of royalties? I would like to understand that better. I would like to get a bit more detail from you on the concept of deemed transfer to the producer. How is this measure perceived by the creative community?

    A little earlier, Mr. Thomson referred to the rights of the creative artist. I also believe that the artist is entitled to benefit from his work, when it takes on life and is seen by others. Would royalties to the artists be done away with? Please clarify this for me.

    Ms. Mylène Alder: As far as your first question is concerned, I can tell you that, although we did not have a mathematical analysis per se done for Quebec, the Motion Picture Association of America has looked at the potential loss of income in the United States and evaluates it at $3 billion US, with the advent of the digital era. We are of course on a smaller scale, but the loss will most certainly be proportionate to our volume. I must point out that we have a very high volume of production in Quebec and what we produce is very popular. People go to see Quebec films, and Quebec TV wins numerous awards. So what we produce is popular and likely to be copied, viewed or what have you.

    As for the loss of income, for example relating to neighbouring rights and copies for private use, many European countries have a private copy regime in place. Authors can take advantage of this. For a number of reasons, particularly under the Berne convention, authors have a national regime and Canadian authors, even though Canada does not have one, can get paid if their works are distributed in countries where there is such a scheme. Producers cannot. As for producers, because not “necessarily” acknowledged as authors of the work—and I put “necessarily” in quotes, because that is a whole other issue—Canada would have to make this regime available, because most of those countries will offer reciprocity to their nationals. This means that, in certain countries, we cannot get money that is there at the present time. I trust that answers your first question.

    As for the second, no I do not think so. It is certainly not the intention of the APFTQ, which has a history of being very much in favour of authors' rights, to deprive anyone of royalties. Earlier I gave a bit of an overview of our legislative context. We have a number of collective agreements in place at the present time, and I can tell you that we have agreements with our screenwriters that involve royalty payments. As for the directors, we also have one for feature films that provides for such payments. We do not plan to do away with all that and start again.

    I will give you one very specific example of our key concern. We have a cinematographer or director of photography who has made a film which wins awards for its pictorial quality. This person claims he ought to be considered the co-author of the film because he is the one who shot it all, and so on. At the present time, the director of photography is covered by a technician agreement, and there are no assignment clauses per se. Often producers will try to determine in advance who will have a creative input, and this creates a serious problem because it is not yet known how the film will be produced. Others will prefer not to take any chances and will get him to sign an assignment of rights as a protective measure. Some do not necessarily do this, and may end up with a finished product of such pictorial quality that the director of photography might aspire to recognition as co-author. Cases like these are the reason why we would like to see this presumption of transfer of rights as a safety net.

    I have provide a summary of our larger brief in the document with my speech.

  (1205)  

    The Chair: Ms. Alder, could you try, please, to be more concise, because we are running out of time.

    Ms. Mylène Alder: Yes, certainly. In this document you will find the parameters for the presumption of such an assignment.The clause is there simply to recognize that the producer has enough rights to make normal use of the audiovisual work. That is it, simply put.

    Ms. Liza Frulla (Verdun—Saint-Henri—Saint-Paul—Pointe Saint-Charles, Lib.): Thank you very much for being here.

[English]

    My question is for Mr. Anderson or Mr. Wilson.

    We received a letter from the Coalition pour un régime équilibré du droit d'auteur, and you're a member of the coalition. The coalition was worried about the motion we passed last week asking the department to come in with a bill

[Translation]

    a draft bill,

[English]

so we could at least look at it, rush the first phase, and really implement the WIPO treaty.

    This communication says the members of the coalition are really worried about that motion. They say we're considering both the authors and the distributors. Can you explain this? Why are they worried about the motion

[Translation]

    that we presented last week.

[English]

    The only thing we want, after years and years of consultation and asking different parties what should go into this law to modernize it.... It's now 2003, almost 2004, and the department has said we will probably get a project in 2004 or the beginning of 2005. We think that's late, considering the technology that is going on. So I would like you to talk about it.

  (1210)  

    Mr. Michael Hennessy: To start with, we don't have any objection to that per se. I think your point is totally reasonable.

    Our concern is that because the department has to respond in two weeks with a general outline, there won't be anything on limitation of liability or safe harbour. We're really just seeking clarity in that process, because the impact on the providers of Internet service in the country without that is significant. We would be the only one of our major trading partners that didn't have that.

    It's not that there's an issue with the motion or your request to the department to respond in a timely manner, but we're really looking for the committee to just ensure that the department is sent the message that the response should include limitation of liability.

[Translation]

    Ms. Liza Frulla: When we look at the phases—

[English]

you have short-term, mid-term, and long-term phases.

[Translation]

    In the short term, we are talking about issues related to treaties, and about the responsibility of ISPs with regard to access to education, photography, and so on. That is in the short term.

    In our opinion, we thought that the mid-term, affecting all issues, that is, new technologies, audiovisual works, copyright collectives, and length of protection, was truly at the heart of the debate. Do you agree with us? Our fear for the mid-term is that if it were not possible to deliver the short term before the end of 2004, we would never see the end of it. Thus, it appears that there is an urgent need for everyone, as much for the ISPs as for the producers or authors, to have a law that would be more modern and less complex, and that would also enable us to enforce the treaties, in the way most countries do today.

    In other words, are we taking too much time or not enough? Have we consulted you sufficiently or not enough? And will the ISPs be able, in the end, to find their place within all this? Can it be done within normal deadlines and not within deadlines which to us appear not only abnormal but also dangerous?

[English]

    The Chair: Mr. Kerr-Wilson.

    Mr. Gerald (Jay) Kerr-Wilson: Just to follow up briefly on the comments Mr. Hennessy made, our concern is that in following the letter of the motion, the departments will concentrate on merely the amendments necessary to implement WIPO. You can have legislation that will allow you to ratify WIPO, but doesn't deal with any of the other short-term issues. Because the motion focuses on WIPO implementation, our concern is that in order to meet the deadline the departments will do the bare minimum necessary to get to WIPO implementation, and won't deal comprehensively with ISP liability and some of the other short-term issues that are also related and need to be addressed.

    So if the answer is that on February 10 we will have a comprehensive legislative reform package that deals with all of the issues, then we're not concerned. Our problem is that if we reach this deadline and end up with half a bill that deals with the bare minimum, we don't know what will happens to the rest of the short-term issues. We've sort of created a fourth tier.

    We're seeking clarification that the committee wants the departments to deal with all of the related issues identified in the short term, and have them brought forward for informed debate.

    Mme Liza Frulla: But just briefly, do you feel you've been consulted enough?

  (1215)  

    The Chair: Okay, do you feel we've consulted enough?

    Mr. Gerald (Jay) Kerr-Wilson: I think there was very thorough consultation in 2001. We certainly had every opportunity to make our issues known. We'd like to have an opportunity to consult on the form of the legislation. We've had a good policy debate. We'd like to see legislation as well, but we'd like to see legislation that dealt with all the issues, not just half the issues.

    The Chair: Just so it's quite clear, if there's any draft legislation or legislation, obviously it will come to this committee and there will be thorough examination of the legislation. We can't commit ourselves to that because it's a process, for sure.

    The Chair: Ms. Lill.

    I'm sorry, it's Mr. Bonwick.

    Mr. Paul Bonwick (Simcoe—Grey, Lib.): Thank you, Mr. Chairman,

    Normally I'd say ladies first, Wendy, but on this particular occasion I'll take my turn.

    First I'll deal with the Cable Television Association's assertions in their letter--or in the copyright coalition's letter--and suggest they are missing the point on a few things. I draw your attention to the word “draft”. We are putting in place timelines, and over the next three months the department will bring forward draft legislation. Based on us getting draft legislation, there will be opportunities for the stakeholders, as well as this committee, to review it and make sure it is comprehensive enough. We are not asking for a final work of legislation that will go to clause-by-clause on February 10.

    I also suggest your words are far different from your letter. I'm disappointed, quite frankly, because we have work to do, by the sound of things, in instilling some sense of confidence in the Cable Television Association. As a signatory to this letter, you clearly do not have confidence in the ability of the department or the committee to make sure it's comprehensive enough to deal with.

    I'll refer you to some of the comments in your letter, versus what you're saying here at the committee. You say:

We are extremely concerned about the committee's motion. The motion could result in draft legislation that does not deal comprehensively

    I think the committee clearly recognizes the complexities that are going to be dealt with here, but we also recognize that we need to get on with this and deal with some draft pieces. We have an opportunity over the next three months--and certainly leading into the three months after February--to deal with this in a comprehensive fashion. I only assume that if it weren't in there, the committee would insist the department deal with ISP liability issues.

    On how detailed we got in the motion, perhaps we could have put that in there, but one assumes it will be an integral part of it.

    We're not viewing ratification in silos; I think we're viewing it by way of priority. I'd like to clear up a couple of other comments you made, where the committee may get a misconception about who's ratifying and who's not ratifying. To suggest that most other industrialized nations have not ratified, are not ratifying, or are in step with them is clearly inaccurate. The United States ratified in 2000-01, and Japan had about the same timeline.

    It's also worth noting that when we asked researchers for information they told us that England, Italy, Denmark, Germany, Greece, and France--I consider those industrialized nations--have made the necessary amendments and are in a position to ratify now. They're simply waiting for the rest of the EU to come on board. I think we need to recognize that Canada is behind and not in step with its fellow nations.

    I would like to put a question to Mr. Thompson. Based on the timeframes we were provided a few weeks ago by the department, what would be the implications to the industry if--and it's very reasonable to think this--we did not put time limits on ratification and it took place some time in the spring of 2005, or more likely the fall of 2005? So I'm talking about two years from now. Could you give me some sense on that?

    Mr. Ken Thompson: I've been in the copyright business now, ratifying and adhering to international treaties, for over 12 years. I know that the first round of amendments--and I'm sorry this is going to be a long answer because it's a long process--to the Copyright Act started in 1988. I believe there was actually discussion that there would be a phase two within six months. But we didn't see that for almost 10 years, because it is very difficult to change our law to accord with modern technology--to fit with the unknown, in many cases. Nevertheless, we've had plenty of time to discuss this. Consultations have reached back to 1998, on which the government had a discussion paper.

    So I think the motion the committee has made here is courageous. On the consequences to the industry, there are no rights underpinning performers' relationships with producers, for example. In fact, those relationships don't extend to the world in total. They don't extend in rem to anybody who's outside of those agreements. So there are all kinds of possibilities for misuse of performers' rights, which means their contractual rights, which means they don't get paid. That is of great significance to us.

    There are all kinds of new uses for audiovisual performances, including in computer games, where artists aren't being adequately compensated. There's very real economic interest at play here, and that's just with respect to recording artists. That goes right down the line for all creators. We need some certainty--that's my answer.

  (1220)  

    The Chair: Okay.

    Ms. Lill.

    Ms. Wendy Lill (Dartmouth, NDP): Thank you.

    I really agree with the idea that performers' and authors' rights have to be dealt with together. We're talking about all of the people involved in a production, and that makes sense to me.

    I guess I'm interested in the mechanics of how this works. We've been talking about the idea of collective rights management and how that works. It seems to work very well with access copyright for an individual author's works. When we start moving into audiovisual productions, they're collective creations, so everything gets squared and just becomes a lot more complex.

    I'm wondering if anybody here can give me a very simple formula. We've dealt with, over the last couple of years, trying to get a handle on Canadian content, and which part of the equation fits where. It's very complex, I realize, but how do you see breaking that down? Is it something as simple as what a performer can pen before a production begins? Is that how they end up getting their percentage of ownership? Is it a contract thing that's battled out with producers and agents? Or is it something you would like to see written in stone, in terms of level of involvement in a work?

    Mr. Ken Thompson: Before the directors and producers answer that question, I'll take a stab at it.

    I don't think adding new rights to the Copyright Act with respect to audiovisual performances for performers is going to make the process that ACTRA carries out in contractual arrangements any different. It underpins or provides a structure on which those collective agreements can now be set.

    There's an issue of technology we're grappling with. For example, in the games industry we have something referred to as motion capture. A concrete example of motion capture is the character Gollum in The Lord of the Rings movie. He was actually an individual who acted out those motions, even though they were digitally superimposed on an animated creature. That, in an easy way, is motion capture. That performer deserves to be compensated for that.

    In the games industry, for example, a motion capture could be made in Canada; the programmers could be in Singapore, Southeast Asia, or India; and the whole thing could be put together in France. We need a copyright structure to hold together the contractual arrangements that sit on top of it. It makes perfect sense.

    Creators and producers have copyrights that hold up their businesses, and performers have audio rights and a structure that hold up their business interests. It just seems absurd that this wouldn't be carried out for audiovisual performers. There's a very good framework to follow on this.

  (1225)  

[Translation]

    Ms. Mylène Alder: To reply to your question and to add something to Mr. Thompson's remarks, I would like to make it clear that in Quebec the situation is a little different. As I said earlier, the collective agreements that the APFTQ has signed with ACTRA must be used by our members. They include rights to payment, called “droit de suite”, related to various types of subsequent use. Thus, someone who wants to broadcast a production on a specialty channel, in perhaps 5 or 10 years, must pay for the rights for such use.

    That said, our collective agreements with the UDA and ACTRA include clauses under which new and unforeseen uses must be covered by an agreement with ACTRA if in English and the UDA if in French. Thus it is wrong to say that in certain situations there is nothing that could be requested or paid to anyone. That cannot be done. The rules must be obeyed.

    And as for the legal basis, I will say that the copyright on images is one that is very strong in Quebec. I can speak about Quebec legislation, which is the one I know best. Thus, under this legislation, an actor's image cannot be used in various ways without the actor's authorization. That is an element the committee might be well advised to consider.

[English]

    The Chair: Mrs. Brand.

    Mrs. Pamela Brand: I just want to add that we at the Directors Guild also have contracts with the APFTQ and the CFTPA, but the lack of clarity in the law as to who the author is has made it very difficult for us. We have to establish our jurisdiction in many countries around the world. We have been collecting, based on European legislation, but we've had huge difficulties, especially with countries like Germany, because in Canadian law the directors are not recognized as authors or co-authors--which is our position--of the audiovisual work. Our director members have lost millions of dollars over the past years because of that.

    That particularly applies to retransmission levies. Because of the lack of an authorship law recognizing who the author is, and the lack of clarity, there are no retransmission rights we can collect in Europe for Canadian directors. That's a very serious issue.

    The Chair: Mr. Schellenberger.

    Mr. Gary Schellenberger (Perth—Middlesex, PC): Thank you.

    There are things I agree with and things I wonder about. I have a couple of questions, and I don't know who's going to answer these.

    On the WIPO treaty, after we enter into a treaty or treaty talks, how many years do you think it should take for those things to be implemented? If it's been since 1997, that's quite some time, especially in the digital age when things change overnight without complying with many of the suggestions that were there. Maybe if we had some of that in it would be good.

    I look at the witnesses we have here today. If you have two ministries looking after copyright, will you have to make this presentation again in front of the industry department? All of those things take time. I'm wondering if it shouldn't be consolidated under one ministry.

    Again, most of the problem is digital. If we were still back in the Dark Ages we could keep up. So these things have to be done expeditiously. On the draft this committee has requested, I think it's very important that we have something there. We should at least have something so you can say, “It's clause 6 that doesn't agree here.” I can maybe understand that.

    I was in municipal government for 12 years, and I know how long things can take sometimes, as has been explained--10 years and 12 years for things to happen. In our jurisdiction, the rule was that every five years you were supposed to review your official plan. When I was on council we started on an official plan. The draft was there, and it took us eight years to implement it--we went past the five years.

    As Mr. Bonwick said, we asked for that draft. It's not the end, but it gives us something here as a committee to look at. Again, that draft could also be looked at by the industry committee, and maybe it could be expedited.

    Do you not think that a draft would be a good thing, and in a timely manner we might be able to look at it and implement all of the things you're asking for more quickly?

  (1230)  

    Mr. Ken Thompson: Definitely draft legislation is called for.

    Just to fill you in, the WIPO treaties are not something new that has suddenly been dropped on the table. They've been around since 1993, when discussions began in Geneva on these treaties and the principles, including ISP liability, even though it's not part of the treaty. It's more than timely to have a draft now.

    The Chair: Mr. Schellenberger, go ahead for one more question.

    Mr. Gary Schellenberger: I really don't have any more questions. I appreciate the witnesses coming here today. I like to get in on the ground floor on some of these committees. I came in partway through on some other thing, so I appreciate all your presentations today. Thank you.

    The Chair: Thank you, Mr. Schellenberger.

    Madam Allard.

[Translation]

    Ms. Carole-Marie Allard (Laval East, Lib.): Thank you for coming here this morning.

[English]

    I will address my question to Mr. Hennessy.

    I understand that the question of liability is a central issue for your industry, and I was astonished to read in your document that there are 70,000 copyright-related complaints each year, in addition to the thousands of other content-related complaints received each day.

    I understand why you made this issue of Internet service providers a short-term issue, because I think it must place a tremendous burden on your industry. Your industry is an Internet service provider, and as you said, you don't want to be a convenient target group. You don't want to be liable when you are mainly providing access, hosting, and doing transmission services, if I understand you correctly.

    I also understand that some players have already found your industry. SOCAN is claiming that Internet service providers should be responsible for the communication of copyright-protected works on the Internet. I also understand that the Supreme Court of Canada is supposed to hear the case.

    So when you propose to amend section 2.4 of the Copyright Act to be more specific regarding Internet service providers, are you taking into account the decision that the Supreme Court may be rendering shortly on that?

    Mr. Michael Hennessy: To step back, what we're really asking for is what is entrenched as the common carrier exemption in the Copyright Act and in all the legislation, either taken or proposed by our major trading partners in the EU, United States, Australia, and what they're looking at in New Zealand. The problem is that while the ISP industry is a very simple target, because it can be conceived of as a bottleneck in the old telecommunications sense, the reality is that there are billions of bits of information going back and forth.

    If you look at some of the peer-to-peer music transfers, for instance, you have issues where people are providing service on remote south Pacific islands, or in the middle of a Palestinian refugee camp. It's very hard for us to look at a packet that may contain a picture, part of a movie, or an e-mail or anything, and distinguish that when you have billions of bits. So while it seems to be an easy target, it would be impossible to enforce. With the cost of trying to do that and the long-run liability, that just wouldn't work.

    The issue before the court is really a very limited one, with respect to whether caching should have the same exemptions as hosting and transmission. Jay, as the lawyer, can probably be little more detailed on that, but I don't think that really addresses the fundamental issue one way or another.

  (1235)  

    Mr. Gerald (Jay) Kerr-Wilson: The issue that the Supreme Court is going to address is limited to one tariff proposed by SOCAN, and there are certainly going to be huge ramifications for our industry whatever that decision is. But regardless of what that decision is, the necessity of having limitations on ISP liability is much broader. It doesn't just cover SOCAN and SOCAN's rights; it covers the liability for the whole range of creative works, and the whole range of the section 3 restricted access.

    Ms. Carole-Marie Allard: If I understand you correctly, you are talking about the urgency to amend section 2.4 to include Internet service providers, because right now there is a judicial gap that may cause you tremendous harm.

    Mr. Gerald (Jay) Kerr-Wilson: The Copyright Board found that paragraph 2.4(1)(b) applied to us in our activities, and the Federal Court of Appeal agreed with two-thirds of that decision. We don't know what the Supreme Court is going to say, but we think clarity is a good thing for everybody. It would preferable to have the act clarified, as it has been in other jurisdictions, to specify the activities that would be covered by the exemption, and the conditions under which the limitations could be relied upon.

    Ms. Carole-Marie Allard: You are also proposing a notice-and-notice regime. You seem to have discussed this regime with other partners. You seem to be ready to implement this regime. Am I correct in thinking you would be willing to see it implemented quickly in law?

    Mr. Gerald (Jay) Kerr-Wilson: We're doing notice and notice on a voluntary basis now. Even though the act hasn't been amended, the Canadian ISP industry--and not just CCTA members, but members of CAIP and Bell--are doing notice and notice now as part of our process. So if that were to be incorporated into the legislation, that would be fine.

    Ms. Carole-Marie Allard: May I ask another one?

[Translation]

    The Chair: We will have another round, Ms. Allard. For the moment it is Mr. Abbott's turn.

[English]

    Mr. Abbott.

    Mr. Jim Abbott (Kootenay—Columbia, Canadian Alliance): Thank you very much.

    One of the issues with copyright legislation, of course, is that the implementation of it comes down to the judgment calls of the Copyright Board, and when they go into dispute you not infrequently end up in a court of law.

    I guess the question I would like to ask everyone, if you care to respond, is should guiding principles be developed in relation to the copyright law, and should those guiding principles be in the preamble of any revisions?

    The upside of that is it would give better direction to the Copyright Board, and certainly direction to courts, as to specifically what the intent of the legislation was. The downside is that in order to develop those guiding principles, I can visualize a tremendous amount of wrangling. So would a tremendous amount of wrangling to arrive at that point be worthwhile, and would this be a worthy change to make to copyright law before we actually got into all of the minutiae and details of copyright law?

  (1240)  

    The Chair: Mrs. Brand.

    Mrs. Pamela Brand: Guiding principles are certainly always helpful, for the reasons you've mentioned. I'm not sure it would take that much wrangling. Obviously it would take some, because there would be guiding principles and getting down to the details. That's where we would have the huge amount of wrangling, but certainly the guiding principles would be very helpful. However, if they will cause delay in implementation, we would prefer not to have them.

[Translation]

    The Chair: Do you agree, Ms. Alder?

    Ms. Mylène Alder: Yes, pretty much.

[English]

    The Chair: Mr. Hennessy, do you want to say something?

    Mr. Michael Hennessy: I guess it's a two-edged sword. I think of the Broadcasting Act in section 3, which has many guiding principles. When you go before the regulator, pretty well anybody can argue that their position is based on some objective under the act. So when you try to develop guiding principles, there tends to be a long list of interests, whether they're ours or somebody else's, who want their principles entrenched in the legislation.

    At the same time, if you can keep it short and express the need for a balance that recognizes the rights of artists, producers, and everybody along the value chain, there may be some benefit. But I think I'd echo that what we're trying to do here is have balanced legislation, clearly sooner than later, and that should probably remain the primary objective.

    The Chair: Thank you.

    Mr. Thompson, briefly.

    Mr. Ken Thompson: Guiding principles would be of assistance in terms of a kind of introductory paragraph to the Copyright Act, just so people knew what it was about. I might also say that over the period of about 10 years, the Supreme Court has gone from looking at the Copyright Act as being for the protection of creators and authors, to being for the protection of a balance of interests. That came out in a quite recent piece of legislation. It would be good if the act could clarify that directly, so courts could follow from a principle set out in the act.

    The Chair: Madame Gagnon.

[Translation]

    Ms. Christiane Gagnon: Thank you. I would like to ask a question of Mr. Hennessy or Mr. Kerr-Wilson.

    In your submission, you state your opposition to the fact that, because of copyright, you have to pay royalties because you provided a hyperlink to a site with infringing content. I would like to know how, in such a context, the government should proceed to fight such illegal copyright infringements. There must be some kind of protection against this practice.

[English]

    Mr. Gerald (Jay) Kerr-Wilson: Clearly our concern with the proposal in the section 92 report about linking to a site with infringing content--itself an infringement--is not to shield piracy. We support a Copyright Act that gives creators the right to take action against people who are making unauthorized use of their works. You should have remedies against a site that's infringing on your rights in a work.

    The proposal simply said that where a link was provided to a site that had infringing content, that link itself would be an infringement. Hyperlinks have become the road map for the Internet, and many times it's an automated process. For instance, on a search engine you put in the subject you want to know about and get thousands of references in return. Some of those references may actually contain infringed material. The search engine is an automated process and there is no human intervention. So there's no way for the provider of the search engine--Yahoo!, or Google--to filter to determine which links go to legitimate sites and which links go to infringing sites.

    Even if there is a filter, you can't always tell simply by going to a site whether or not a work is presented with authority or not. The copyright status of a work on a website is often impossible to tell. It seems to be placing a huge burden on search engines and anybody who provides links.

    If the Government of Canada wanted to have a page of hyperlinks to cultural industries, it would then have to police that to make sure none of those links had pages with infringing content, otherwise the government could be infringing. It just seems that the act of providing the link is too remote from the infringement to impose liability.

    Certainly the act should provide that where infringement was proven you should be directed to disable the link. There are remedies that don't have to be so extreme as saying, “I am infringing on rights because I have a link to somebody else who, unbeknownst to me, is infringing on rights.” That is our concern.

  (1245)  

    The Chair: I will allow Mrs. Allard and Ms. Lill brief questions.

    Madame Allard.

    Ms. Carole-Marie Allard: Mr. Hennessy, we heard a concept here about making it available for Internet users or collective licensing. Does your industry have a position on that, or are you staying away from that debate?

    Mr. Michael Hennessy: I'm going to give that to Mr. Wilson, because he's our drafter on this piece.

    The Chair: Mr. Wilson, you're picking up the hot potato.

    Mr. Gerald (Jay) Kerr-Wilson: Thank you, Mr. Chairman.

    Our interest is really as the people who provide the connection to the Internet. We're not the content providers, so we don't have a direct interest in whether or not collective licensing is the best approach to clearing rights on the Internet. We deal with collective licensing in our cable industries with SOCAN and the retransmission collectives. We recognize they're a very efficient way to clear a large amount of works with minimum effort, but it has to take into account the balance.

    Collective licensing shouldn't be the only solution. I think it's a very important piece of the puzzle for dealing with rights over the Internet, but not to the exclusion of reasonable exceptions and limitations.

    Ms. Carole-Marie Allard: What about the concept of making it available? Are you saying we're not responsible for the content?

    Mr. Gerald (Jay) Kerr-Wilson: Our position is that whether you deal with it by telecommunication or some new right, it will give clarity to the act because it will define Internet-specific activity. We don't object to the making available right being extended to neighbouring rights. We don't object to clarity that the communication to the public right includes making available on the Internet. Again, that's an issue for content providers who are dealing in the works.

    The Chair: Mrs. Lill.

    Ms. Wendy Lill: I just want to ask Mr. Thompson from ACTRA one thing. You make the point that it's critical right now that performers' rights are dealt with. You say it's essential to complete the process started five years ago and provide a comprehensive set of rights for audiovisual performers.

    What exists now? Do you have a draft of what you believe is that comprehensive set of rights? This government likes solutions, not problems. We all know that. Is there something on paper that we can look at and say that it makes sense? Let's get down to details here. Is there something being floated that you believe might work?

    Mr. Ken Thompson: The quick answer is that the reference to five years ago was on the WPPT, which to an extent protects performers' rights. You've asked the government for a draft. That treaty sets the foundation for a further protection body for visual rights. For example, the WPPT covers things like the making available right, the right of reproduction, technical measures, rights management--all those essential things for performers in digital technologies.

    That treaty itself is kind of the groundwork on which we would include, among the rights that performers need now, the right of making available in a performance fixed in an audiovisual medium, and the right of reproduction, which don't exist at this point under our legislation. So that was my reference in bringing it up to date.

    But to answer your question directly, we don't have any draft legislation that we've drafted at ACTRA. That's not something we would undertake unless requested. It's really something for the government departments to undertake. We would love to comment on what they draft.

  (1250)  

    Ms. Wendy Lill: So you haven't seen any draft. There isn't something out there now being worked on that you could look at and we could look at.

    Mr. Ken Thompson: We can only look at foreign legislation, for example in the UK, which was referenced here earlier.

    The Chair: Madam Frulla.

    Ms. Liza Frulla: Just going back to you, Mr. Wilson, when we read your report, perhaps it's bad judgment, but it's like saying that the ISP is not responsible for anything. The short term of this law is “responsibility of”. What would satisfy you?

    Mr. Gerald (Jay) Kerr-Wilson: It's probably overstating the position to say that we think ISPs have no responsibilities. There are two issues: should ISPs be liable under the law; and what role can ISPs play in helping to address the problem of infringement?

    On the first issue, from a practical point of view, if you craft a law that makes ISPs liable for the works their subscribers access, we can't manage the liability. If we were liable for a poem posted on a website in India and every movie that was made available, even if we had an ISP collective licensing scheme that cost us hundreds of dollars a subscriber a month, we couldn't clear all the rights, because the movie industry, Jack Valenti, is never going to agree to collective licensing for major motion pictures.

    We also know that business models on the Internet are still very tricky. If you develop a law that suddenly sets up the Canadian ISP industry as a huge target, where anybody with a right to a work that's being accessed in Canada can come to the Canadian ISP industry and say, “Great, I've found someone who's going to pay the cost of that.” they will line up.

    It sounds like an overstatement, but we simply couldn't manage being liable for infringement of every copyright work on the Internet that was available in Canada, and that's what would happen under that regime. Every other country that's dealt with this has recognized that ISPs could never manage that liability.

    The flip side is that if ISPs aren't going to be liable, do they have a role to play? Clearly we do, because some of the content is stored on our equipment, although decreasingly so. In some cases we have the ability to play a role, and notice and notice is what we've suggested. We now have accepted use policies with our subscribers that say, “You cannot use our networks to infringe copyright, and if you do we have the right to suspend your service or terminate your service.”

    We're willing to engage in a complaint-driven process with complainants. We're doing that now and it's effective. So we have a role to play, but we simply couldn't bear the liability of being considered the infringers.

    The Chair: I'd like to follow up on Mrs. Frulla's question. This isn't about copyright, but the examples have application in any event.

    I've heard testimony from different people at conferences that in certain areas, such as hate propaganda, legislation has come through in parts of Europe--Germany is one example, and France is another--that targets the ISP as being ultimately responsible for distributing the material. So instead of going to the creator of the material, they hold the ISP responsible in their legislation. I don't have the legislation here, but I was promised the latest one, the French one. I understand that's the case in Germany for certain issues. I know it's being looked at in regard to pornography.

    Could it in some way be extended to some forms of copyright, so some control was exercised on the ISP for providing material that they knew deliberately infringed copyright?

  (1255)  

    Mr. Gerald (Jay) Kerr-Wilson: Probably the last part of your question is key. If an ISP is engaged in the activity of making content available by assembling content and delivering content to a subscriber, then we would consider that ISP to be in the role of a content provider in that particular circumstance.

    We're not asking for a get-out-of-jail-free card, where ISPs can do anything. We're saying that when an ISP's only activity is to provide hosting to their subscribers or transmission facilities--connectivity--they don't have the control. They don't know and have no way of knowing if the content is infringing.

    We used the analogy in our submission that you can't ask the post office to open up every single letter to decide whether the contents are objectionable. Multiply the millions of pieces of mail that flow through the postal system every year by the billions of bits of information that flow through an ISP's network. The quantity is simply unmanageable, the technology is unmanageable, and the network would become unworkable, as we know it.

    So we're saying that if an ISP were doing something it knew was wrong, the exemption wouldn't apply. It would apply if the ISP had no ability to control the content or know that the content was objectionable.

    The Chair: Mr. Schellenberger.

    Mr. Gary Schellenberger: I just have two questions and they're kind of connected. Do you agree with the government's proposal that the three phases of revision be short-, medium-, and long-term?

    Instead of proceeding on an incremental basis, would it be better if all copyright changes were effected in a single amending bill?

    Mr. Michael Hennessy: In our submission at the beginning we said we supported the three-stage process, but you can only do so much before you get bogged down in complexity. So if you want to move along, I think the way you're going is the right way.

    The Chair: Does anybody else want to address this?

    Mr. Ken Thompson: On the incremental approach that's been put forward to us, ACTRA's members would simply like audiovisual performances to be moved into the bracket with the questions raised about audiovisual works in general.

    The Chair: Mrs. Brand.

    Mrs. Pamela Brand: We also agree with an incremental approach. We sympathize with the performers. As long as their issues don't delay the authorship issue, we support that.

[Translation]

    Ms. Mylène Alder: As far as I am concerned, I have no objection to proceeding in three stages, as long as we deal with audiovisual in the first stage. We would hope for a gradual implementation, rather than waiting for the end. We have already been waiting long enough.

    The Chair: As I see it, the main challenge is that everyone would like it to be gradual, as long as his or her own concept is included.

[English]

    If his or her concern is in there, let's have it that way. So in the end I guess it will be a one-step deal.

[Translation]

    Ms. Allard, I believe you wished to conclude.

    Ms. Carole-Marie Allard: Here we have a concrete proposal. Therefore, I will ask everyone this question. At stake is the amendment of section 2.4(1) so that Internet service providers are not subject to the Copyright Act. How do you react? Do we have a consensus on the idea of accepting this proposal? What would you say if a bill were to propose that tomorrow morning? Would you say no?

    Ms. Brand.

[English]

    Mrs. Pamela Brand: No. We think they should be responsible.

    Ms. Carole-Marie Allard: Should they be responsible, Madam Ryshpan?

    Ms. Arden Ryshpan: They should be responsible.

    Mr. Ken Thompson: Of course they should be responsible, but it's just not that simple. That's part of the problem. That only covers the carriage of telecommunications; it doesn't cover all the other rights. It would not include, for example, the right of making available, if that were added to the Copyright Act. It's not just a simple matter of amending that to include or allow them to step outside of that. It's more complex.

·  (1300)  

    Ms. Carole-Marie Allard: Mr. Hennessy, I think you're going to have to work the issue.

    Mr. Michael Hennessy: Mr. Lincoln made an interesting point when he talked about the issue of ISPs distributing information. In the cable business we distribute channels. In the Internet business we don't distribute; we provide a link that connects to links that connect to links that link basically everybody in the world today.

    If we were unknowingly liable for copyright, pornography, or many things--which is generally the case because we're talking about billions of pieces of communications--the only way we could ultimately operate would be to shut down the Internet. You would have to close it. You would have to put premium prices on things. You would basically turn it into a network very similar to a television network today. That would be good in many respects for people who economically benefited from it, but it would destroy some of the potential for democracy and freedom of speech around the world that we're looking at.

    It's a two-edged sword. There are all kinds of threats that the Internet is bringing upon us, but it has also probably opened up the hearts and minds of people around the world, and provided them access to kinds of information that was incomprehensible even 10 years ago. I was in charge of the introduction of long-distance competition at the CRTC 10 years ago. The Internet, in 50,000 pages of transcripts, evidence, and paper, was never mentioned. Browsers only started to come into being 10 years ago, so we're in a new age. It's a frightening age.

    People want to make the ISP liable because it's in their economic interest to find somebody to pay. But the only way we can make people pay is by shutting down most of the Internet and raising prices. That would make what the Internet is today disappear. That's the threat.

    The Chair: On that note, Mr. Hennessy, we will conclude the session.

    We have been trying in these sessions to get different points of view in every panel, so we can hear different perspectives. I think that has happened with this session. It was very informative. We appreciate it very much. We found it extremely interesting. As you can see, the time is upon us and we're still talking and discussing issues that are very close to all of us.

    Thank you very much for your presence here. We appreciate it.

    The meeting is adjourned.